Examination of Witnesses (Questions 280
- 299)
THURSDAY 10 NOVEMBER 2005
CHANGES TO
PRIMARY CARE
TRUSTS
Q280 Dr Stoate: I appreciate that,
but I have had PCTs coming to see me saying they are extremely
concerned that every time a hospital does something the cash register
pings in the PCT headquarters and there is nothing they can do
about it because they have effectively a book of signed blank
cheques, and it makes the PCTs' job to commission community services
far more restrained because they are always having to play games
with the hospitals which they have no control over. When you expand
that policy to emergency care as well, every time a patient turns
up at A&E, whether the PCT likes it or not, the cash register
pings, and there is nothing the PCT can do. Had we gone the other
way and given the PCTs a far, far stronger commissioning structure,
they could have put right the A&E departments' problems and
the waiting list target problems and the hospital problems in
general by commissioning and targeting services from the primary
care end and got the quality they wanted. We seem to have put
the cart before the horse in some instances and that is why PCTs
at the moment are struggling and having to reorganise.
Lord Warner: I will again ask
John to comment but, before he does, I would say at the end of
the day we are where we are, and we did have to improve the hospital
services and we did fight a number of elections, if I can put
it this way, on making those improvements and that is what the
public required.
Mr Bacon: I will make one personal
comment, if I may, and then come on the PBR point. My personal
view is that we have not taken sufficient action since 1990 to
strengthen the commissioning side, and you can debate why that
is but what we are now saying is that the way in which we want
the system to work absolutely demands that the commissioning function
is as equally strong as the provider function. You could criticise
us over many years for being tardy in that, what we are now doing
is addressing it in a meaningful way. In the PBR context, what
you have to look at here is that we are introducing a financial
system which incentivises the provision of good services for patients.
PBR is the expression we use for the current tariff-based system
for essentially elective care and, with the exception of foundation
trusts where we have taken it a little further, the current PBR
system only applies to elective services—
Q281 Dr Stoate: Not from next April.
Mr Bacon: I am coming on to that.
What we will be announcing over the next little while is that
the next stage of PBR will be for 2006-07 and the precise details
of how the non-elective part of the system will work. So we have
been very carefully, with the service, working through the issues
of how we extend PBR firstly to the non-elective services in hospitals
and then progressively to a number of other services. The model
of PBR may not be the same for each of the services we are looking
at, so I would expect a very different model for PBR as we get
into community-based services from the one we have for elective
services. You can argue that we should have got all this in place
first, and in an ideal world we would have, but we are trying
to be very careful to ensure that we incentivise the right things
and we have the right control mechanisms as we move the system
into other areas.
Q282 Dr Stoate: Given that we are
in the direction of travel we are going and given that 2006-07
is looming, we have to get practice-based commissioning up and
running pretty smartly, otherwise it will cause big imbalances.
I think you probably agree with that. What do you think is the
proportion of practices, first of all, which are currently taking
part in any practice-based commissioning of any sort and, secondly,
what are you going to do about those practices which really do
not want to know about it?
Lord Warner: I cannot give you
a figure, Howard, on where they are. They are in varying states.
Certainly you can go to places like Bradford where there has been
a very good effort made and there is some very energetic practice-based
commissioning going on, fully supported by the PCTs. We do know
there is a degree of variability in PCT support for practice-based
commissioning in some cases. It is not a question in some cases
of GPs not wanting to do it, it is more to do with whether they
have been given encouragement and support and information and
the indicative budgets to do it. What we are proposing to do,
and people are working very energetically on this at the moment
with other stakeholders and the professional interests, is to
get out before Christmas a document which sets out in a very structured
way where practice-based commissioning fits into the wider commissioning
agenda and starts to identify some of, what one of my colleagues
has called, the rules of engagement for GPs especially for 2006-07.
So by the turn of the year we will be able to give them a clear
picture of what the expectations are, so the PCTs and GPs have
a clear idea of what the expectations are of what could be achieved
and delivered by practice-based commissioning in 2006-07. One
of the things we are also working on, to give as full a picture
as I can to the Committee, is trying not to do, as we sometimes
do, the most difficult things first but trying to do the easiest
things first. Where are the specialties? Dermatology is one which
comes to mind where we could actually make good progress here.
There are a lot of GPs with specialisms in dermatology; it is
a very big chunk, as you know, of the caseload of GPs. We want
to take some of these areas where we can make progress very quickly
and use some of the good practice examples which have been used
in some parts of the country and encourage others, GPs and PCTs,
to follow those good practice examples. So we are going to concentrate
on practical advice and information and try to encourage them.
It is not to stop people doing other things but to illustrate
what are the things you could really do to make progress across
the country in 2006-07.
Q283 Dr Stoate: I accept that. You
have focused on the best, and you are absolutely right, there
are many practices out there which do a fantastic job with their
PCTs and that is best practice and it is working well in some
areas, but the NHS Alliance told us last week that, in their words,
"there was a woeful lack of information" for GPs about
practice-based commissioning so far, and they estimated that by
the end of next year, when it ought to be up and running, 50%
of PCTs will have less than 50% of practices involved. We all
know the direction of travel, we are where we are, we know where
we need to go, but what we are told by the people out there doing
it is that the information is woefully inadequate and that 50%
of the PCTs feel that less than half their practices will be anything
like ready in the time frame we have given them by the end of
next year. How do we even begin to tackle that?
Lord Warner: The best way to tackle
it is for us to work very closely with people like the Alliance,
with Michael Dixon and his colleagues, and other colleagues, and
not be too precious about standing back from that. I now have
a huge amount of my diary time given over to working with GPs
and their various interests and the other people in primary care
teams to make this work. For example, I had a meeting with a lot
of practice managers earlier this week to try to work with them
and get a feel for where things are. You are absolutely right,
there is a huge variability, I am not disagreeing in any way with
what you are saying. What we have to do is energise people a bit
more, but part of the energising is explaining very clearly to
PCTs what the obligations are on them to facilitate practice-based
commissioning and also give more of the GPs the tools. Part of
the reasoning is not that they are philosophically opposed to
practice-based commissioning, they simply do not have the tool
kit to make it work in their particular area. All we can do is
work as hard as we can to move them along that path.
Q284 Dr Stoate: With the reconfiguration
of PCTs going ahead as of early next year and with the targets
for practice-based commissioning at the end of next year, do you
honestly believe we are going to get anywhere close to that target?
Lord Warner: I think we will get
very close. I will really stick my neck out. We will achieve everybody
being engaged and involved in some way but it is true to say we
will have variations in different parts of the country. I am confident
that we will have a pretty credible system of practice-based commissioning
up and running, and not because we have brow-beaten GPs into doing
it—nobody would be so foolish to do that—but because
we have worked with them, encouraged them, incentivised them.
We do have things like negotiations which are going on at the
present. GPs, it seems to me on recent evidence, tend to be rather
good at responding to incentives. We do actually have contract
negotiations which enable this to be incentivised.
Q285 Dr Naysmith: Following on from
that, it is possible that under practice-based commissioning some
practices will be better than others at using the resources, and
therefore you will end up with some patients getting a much better
service than others. Is that a possibility?
Lord Warner: It is a possibility
but it is probably no different from where we are now.
Q286 Dr Naysmith: But we are trying
to improve things.
Lord Warner: We are trying to
improve things but we will not make the changes dramatically overnight.
I am tempted to say that you will find that not all GPs are as
well motivated and dynamic as Dr Stoate in their practices. There
will be varying experiences for patients but there are a lot of
varying experiences for patients at the moment. As I was saying
earlier, we have to move as many along the path as quickly as
possible and give them the knowledge base, the tool kit, the understanding,
the support from the PCTs, to make those interventions on behalf
of their patients.
Q287 Dr Naysmith: One of the things
which could happen as a result of that is that patients could
decide that there is a practice down the road which has a much
better service than the one in their road and decide to switch,
so that what you are doing will encourage patients to switch.
Lord Warner: We are not seeking
to get patients—
Q288 Dr Naysmith: That is choice,
is it not?
Lord Warner: We are not seeking
to get patients to switch. I think the evidence at the moment
from survey after survey and the current consultation which is
going on is that the overwhelming majority of patients actually
have a high regard for their GP. GPs are as near as anybody in
the NHS to achieving sainthood with their patients. It is true.
It is a very consistent message. However, they are not all as
pleased as they might be about some of the access arrangements
to their GPs, they would like the GPs to be open for different
periods of time—Saturday mornings come to mind—they
do have some expectations of being able to be navigated around
the system more easily and more speedily. They are very happy
to have a wider range of services delivered by nurses. They would
quite like GPs to improve their telephone systems. They are not
uncritical friends of the GPs. They expect changes in many of
these areas and they expect us to remove some of these artificial
barriers between primary and second care which they do not understand,
but they look to the primary care team to help them through some
of those boundaries. Some of them will leave. If the GPs themselves
do not respond to some of those needs, some of them may vote with
their feet.
Q289 Dr Naysmith: That is what I
am getting at. I understand what you are trying to do, and I am
all in favour of it, but you could end up with the situation,
because we have some GPs nowadays who are not as good as Dr Stoate
over there, who operate out of premises which are not of a high
standard. We are all talking about choice all the time in the
NHS now so you might see this as something which patients might
want to do if one doctor can get you a social worker much quicker
than another. What I am looking at is the kind of perverse things
which might end up happening because of this change and you have
to be aware of that.
Lord Warner: I think that is absolutely
right but that is another reason why we need to strengthen the
commissioning function of PCTs, because, let's remember, they
are not just commissioning services other than primary care, they
are really meant to be in the lead for making sure they have the
primary care in their area which is needed, that they are commissioning
primary care. That is where they have to be more alert than some
of them have been in the past about some of the opportunities
for doing things a little differently to bring more primary care
services into particular areas, whether that means liberating
some of the existing GPs and their services to expand their capacity
in particular areas or whatever. It is often down to things like
being able to expand the premises. Sometimes the premises themselves
are a limitation on GPs developing their services.
Q290 Dr Naysmith: Looking at the
other side of the coin and still looking at possible perverse
outcomes of your changes, have you considered the possibility
that practice-based commissioning in itself might compromise patient
choice? That patients who have choice at the moment, once practice-based
commissioning is in place, particularly if it is a big group practice
or two or three big practices getting together on commissioning,
will have limited patient choice?
Lord Warner: Patients will certainly
not have their choices limited in areas like elective surgery,
they will make their own judgments with their GPs about where
they go. As we take the choice agenda further forward, and we
are working on some of this now, the information which is available
to patients to exercise that choice will improve and grow. That
is an inevitable consequence. What I think it will mean is that
if they do not find the expectations they have of primary care,
they will start looking around. That is undoubtedly true. Once
you have put the choice agenda forward for the public, they will
learn to exercise those choices in a variety of different ways.
Q291 Mr Amess: Saint Dr Howard Stoate,
what a marvellous image! Occasional in-house prescriber of Viagra,
fantastic! We are nearly at the end now, we have come to community
services and you have made your position very clear on the Government's
intention to improve primary and community health services. Last
week, Yvonne Sawbridge argued that fragmenting the joined-up services
which community health professionals currently strive to deliver
is a real risk associated with introducing a plurality of providers.
You would have heard this morning the robust evidence given by
the Royal College of Nurses who flagged up how are we going to
cope with the flu epidemic, who believe we need strong, robust
community services, who believe that the reorganisation is taking
the focus away from that which they are best at doing, it is a
phenomenal distraction, unacceptable and all the rest, but who
believe these community health services are very important. You
may argue against it but who exactly would be responsible for
safeguarding seamless care in your plan?
Lord Warner: There are two elements
I think. There is the element about whether you have a sufficient
volume and diversity of community services and primary care in
any given area. That is I think largely the responsibility of
the PCT, fed from the experiences of practice-based commissioning,
but ensuring that a particular area has the range and organisation
of services it needs is down to a strongly commissioning PCT.
At the same time, when you get down to the individual patient,
one of the things we are trying to ensure is that the primary
care team itself, and it is not just the GP, is effectively joined
up at the point of the individual patient needing services. One
of the things coming out very consistently from this current public
consultation is the boundary between health and social care and
how you make that work better. That is not much to do with community
nursing, it is actually much more to do with the relationship
between social care services and primary care services. The public
is looking on an individual level much more for that to be integrated.
So there are two strands here. How do you get it joined up at
the geographical, territory level, and how do you get it joined
up better and more seamless for the individual patient.
Q292 Mr Amess: Your comments are
welcome but again I think you have a bit of convincing to do with
the professionals involved. My final point is about additional
providers of community services in deprived areas, just as it
has proved more difficult to attract general practitioners. If
this happens, will not deprived populations be more likely to
miss out on the perceived benefits of competition and therefore,
given that the Government is always saying they are doing everything
they can to reduce inequalities, will not health inequalities
actually widen as a result of these policies?
Lord Warner: I do not think so.
Ten or twelve years ago I chaired a family health service authority
in East London and the only way in some parts of that territory,
and it is still true today, you could go forward was by attracting
more providers of primary care in those territories. The truth
of the matter is that in many of these areas of high health inequalities,
the present volume of services—GPs, nurses, everybody else—is
simply not great enough to actually cope with the demand and needs
of those services. We have to find better ways, through strong
commissioning, to bring a larger volume of services in there.
It is not just about more diversity but simply that there are
not enough health professionals providing care in some of those
communities. The response you will be able to get will be different
in different areas. In some of these areas they need to be service
responses which are more ethnically attuned to the needs of some
of those particular service areas. That is why we need strong
commissioning to meet some of those concerns. I do not think anything
we are doing will make any of these situations worse, they are
designed to make them better.
Mr Amess: I hope you are right.
Q293 Chairman: I think we are very
impressed, Minister, that you are quoting our witnesses of last
week. I have no doubt you will have read what the witness, Dr
Groom from Oxford, said about the potential situation in Oxfordshire
in that the SHA are currently considering whether or not the management
of the future Oxfordshire PCT should be put out to tender. Could
you explain to the Committee what you believe will be the benefits
of this type of approach?
Lord Warner: I am not sure I want
to be an advocate for what Oxford are proposing. I think I will
try to explain the Government's position on this and our understanding
of how Oxford have got to the situation they have got to. My very
clear understanding is that in Oxford we have historically had
five primary care trusts and for many years few of them have actually
been performing particularly well. The SHA, who are the performance
monitors, so to speak, in the Health Service have rightly I think
been focusing, since well before 28 July, on how they deal with
that particular problem. That has been the nub of the problem
which has been confronting them. One of the options they have
been considering is finding a new management for PCT functions
by way of an open tender. That is the path they have chosen to
go on. Our position is as follows. We want to ensure that once
we have had the consultation we have been discussing this morning
at considerable length and a model has been decided of configuration
of PCTs for all the different parts of the country, including
Oxford, and once that has settled, it is then down to that new
PCT to decide the organisation that it actually needs to discharge
its statutory responsibilities. It is up to them to make that
decision. If they choose to continue along the path that the new
PCT, whoever they may be, and the Oxford SHA responsible—the
Thames Valley SHA in this case—have decided they want to
go along, that is a matter for them. But going along that path
does not in any way remove their statutory obligations, their
accountabilities, their responsibilities for the appropriate expenditure
of public money in that territory. It does not mean they will
have an additional budget to actually provide that type of system.
They will have exactly the same budget as any other PCT of an
equivalent size. So what I am saying is that it will be down to
the new PCT to actually decide on the way of discharging their
accountabilities in the most appropriate way, and they will be
held to account for those. They will need to consider whether
this model which the SHA has constructed is an appropriate model
or whether they would choose to go down a more appropriate path.
Our position is that we need to wait and see and leave that to
the judgment and decision-making of the new PCT.
Q294 Chairman: The witness we had
works within the Oxford City PCT, which I understand is a three-star
PCT, and she may have some comment to make in relation to that.
You say there are no additional budgets but what was said by the
witness last week was that the Oxfordshire budget in this area
is about £600 million, and if a private company took over—private
company profits are normally about 10%—on that basis that
is £60 million less for health care expenditure in Oxfordshire.
That is a very crude analysis, as I often give, but what do you
think about that type of comment?
Lord Warner: I suppose the short
answer is, not a lot. The more serious answer is what I said earlier,
that the PCT which is responsible is responsible for discharging
their responsibilities to commission the services which are appropriate
within the budget available for the community that they are serving.
They will have exactly the same administrative budget as an equivalent
PCT of that size, no more, no less. They will have to decide what
is the best way of doing that. As I understand it her remarks
do not relate to the issue of out-sourcing. The PCT budget would
not produce a £60 million profit for the particular organisation,
if it was a private organisation, that was responsible for the
commissioning function of the PCT, they would be paying some kind
of management fee with no doubt some degree of profit element
in it but they would be paid a management fee for discharging
those commissioning functions on behalf of the accountable body.
It does not follow that the services they would commission within
their territory would be private services, they may well commission
a wider range of public services, they may well commission a range
of voluntary services, mixed voluntary and public services. It
does not follow that if you out-source your commissioning function
on some agreed fee basis that you would actually be favouring
the private sector in the direct service delivery which comes
out of that commissioning.
Q295 Mr Campbell: Dr Dixon of the
Health Service Alliance last week said he was greatly concerned
that the private providers coming in would bring in new practices
basically just to cream off, or cherry-pick, the services where
they can make money. Would that happen? Would we see a firm coming
into the Health Service and getting its hands on something and
making a profit?
Lord Warner: If you take another
territory, what you will be getting in elective surgery is independent
sector treatment centres operating within an NHS tariff. That
is what you would be getting. What sometimes they bring is a more
efficient way of actually operating. However, what I would say
in response to Dr Dixon is that if new providers come in and they
take on a list of patients, they will have the same obligations
to that list of patients as any other GP or set of GPs taking
on that list of patients; they will not have a different set of
obligations. Dare I say it, GPs on the general medical service
contracts are themselves private contractors, they are private
providers and they do operate on a profit basis in their practices.
Mr Campbell: I am not sure of that. You
had better tell me, Howard. Is that the case?
Dr Stoate: He is right, we are actually
independent contractors and we contract services wholly to the
NHS and it is on a profit or loss account basis.
Mr Campbell: When this comes before the
House the privatisation issue will be the big issue because it
is not acceptable in the Health Service, even though I am now
told you make a profit.
Dr Stoate: It is called wages.
Q296 Mr Campbell: When a company
comes in, what is to say that it will skim, that it will skim
other patients, skim other providers as long as it makes a profit?
That is what a company is for, to make a profit. The Health Service
is not there to make a profit unless you make it private all the
way through of course, but we are not going to do that, are we?
Lord Warner: Well, 12½% of
our NHS budget goes on drugs, all of which are bought from the
private sector at a profit. Another, getting on for, 5% goes on
medical devices, all bought from the private sector at a profit.
I do not see too many people actually building hospitals themselves,
they are all built by the private sector at a profit. I have already
mentioned GPs. We have quite a long and strong tradition in the
NHS, from the outset, where the private sector has been a partner
in the provision of NHS services.
Q297 Mr Campbell: But even Dr Dixon
said that he did not want to see a full-blooded market situation,
half perhaps but not a full one. What we are suggesting here,
with the introduction of private providers coming in, means we
are going down the road of privatisation.
Lord Warner: I do not think we
are saying that there are going to be lots of private providers
coming in. What we are saying is that in many areas, including
some of the areas with the greatest health inequalities where
there are shortages of primary care services, we need some new
providers. Those new providers could be existing GPs and primary
care teams expanding their range of services. Somewhere along
the line, if we are not to fail many of these poorer communities,
we have to do a better job collectively of actually providing
community and primary care services for them, and that means that
the commissioners, whether it is Oxford or anybody else, have
to actually get the best deal they can, whether it is public providers,
whether it is voluntary sector providers, whether it is private
providers and sometimes it might be joint ventures, to deliver
the services those communities need. That is the philosophy we
are expounding, it is not hell-bent privatisation.
Q298 Dr Naysmith: One of the other
rather troubling aspects of this affair, Lord Warner, is that
in Oxfordshire the Board of the reconfigured PCT will not be appointed
before next March, assuming all goes well with Mr O'Higgins and
his committee, but the proposal is to put the tender out this
month and that has been agreed, as we understand. So how can non-executives,
who have not yet been appointed, have any input in this tendering
process?
Lord Warner: I would have to look
into what those processes are. My position is still, on behalf
of the Government, that this is a decision for the newly reconfigured
PCT. I will certainly ensure that is communicated very clearly
to the Thames Valley Strategic Health Authority.
Q299 Chairman: I hear what you say
about the decision of the PCT and quite right too but as we understand
the changes, even the 28 July changes, it was that effectively
PCTs may divest themselves of all providing and if they want to
do that in the future we assume they can do that. Are we not talking
about something a little bit different here because PCTs will
still have the responsibility for commissioning, and by and large
I would have thought that is outside the acute sector, that is
your local National Health Service. If that particular contract
goes to a private company which will then commission for and on
behalf of, would you as a minister be totally happy that, instead
of having what most people would perceive to be the local primary
care National Health Service being the PCT making sure we get
the provision we need in the private sector, it is a private company
that is doing that? Would you be happy with that?
Lord Warner: I am neither happy
nor unhappy. I have some experience with contracting and the issue
with contracting is that you specify exactly what you want and
clearly to whoever you are asking to contract for you, and that
you are clear in your mind what is the price you are prepared
to pay for that service you are contracting for. For this to be
successful in the form as I understand the SHA proposal, the PCT
itself would have to be able to discharge those responsibilities.
It would have to be able to explain, it would still have an accountable
officer for the public money it is spending. It would have to
have some very convincing arguments that it could discharge its
public accountabilities in the way it was proposing through that
contract. I think I would like to pass the rest of this answer
to John Bacon because he has a lot of experience in discharging
public accountabilities.
Mr Bacon: I would just like to
reinforce the points, the Minister has made. The first point to
make unequivocally is that we want the new PCT, when it is created,
to make decisions on this issue. Let's be clear about that and
Thames Valley Health Authority will be reminded of that. Secondly,
the PCT—if it emerges as a single PCT for Oxfordshire and
that would be the subject of both Mr O'Higgins' comments and then
a public consultation—would be a statutorily constituted
PCT in the same way as any other PCT and would be accountable
in the same way as any other PCT through the SHA to Sir Nigel
through me. Let's be absolutely clear, we are not—and cannot—putting
out to the private sector that statutory responsibility. What
functions of commissioning that PCT decides it wants to contract
to somebody else is a matter for the PCT, and we already have
examples where elements of the process of that have been contracted
to somebody else for services, usually the public sector but not
exclusively. So we need to be really clear here that if that were
to happen, it does not alter the statutory base of the PCT or
its accountability to the NHS.
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