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Health and Social Care (Community Health and Standards) Bill

3.13 p.m.

The Parliamentary Under-Secretary of State, Department of Health (Lord Warner): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

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Moved, That the House do now again resolve itself into Committee.—(Lord Warner.)

On Question, Motion agreed to.

House in Committee accordingly.


Clause 49 [Annual reviews]:

[Amendment No. 281A not moved.]

Earl Howe moved Amendment No. 282:

    Page 17, leave out line 37.

The noble Earl said: In moving this amendment I shall speak also to Amendments Nos. 341, 347 and 360. I make no apology for returning to the issue of star ratings. We see in Clause 49 that, in each financial year, CHAI will have to conduct a review of the provision of healthcare by and for each English NHS body and each cross-border strategic health authority and must award a performance rating to each such body.

There is, to my mind, a distinction to be made between performance indicators and star ratings. I have no objection to a hospital being measured against a range of performance indicators. That is often a useful exercise for management in driving up standards across the board. When the process gets corrupted, however, is in the translation of those indicators into crude star ratings. Under the system devised by the Government, star ratings determine a great deal. A three-star rating is currently a prerequisite for a hospital if it wants to apply for foundation status. More generally, it is the goal towards which the management of a hospital strives in order to win the prizes distributed by the Secretary of State under the banner of so-called earned autonomy. But there are wider dimensions as well. Whether a hospital gets three stars, two stars, one star or none can affect the whole range of its activities; chief among which is the ability to recruit and retain good staff. There is no doubt that star status directly affects morale, and it is inevitably the measure by which that hospital is perceived by its patients and the wider public.

Given that so much depends on it, the one thing that we should look for in a star rating system is for it to be a true and fair indicator of performance. Yet that notion was completely blown apart by the report of the Audit Commission earlier this year. The report showed that, in very many instances, a hospital's star status had almost no bearing at all on how good a hospital it was from the point of view of patient care. That is partly because of unreliable data collection; and partly because star ratings are much more to do with internal processes than with the things that most of us would associate with good care and treatment.

Managerial competence is hardly reflected in the figures at all. Indeed, in a revealing section of its report, the Audit Commission states:

    "There is a statistically significant relationship between performance and managerial adequacy. The number of DH stars awarded is only weakly related to either".

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That is the nub of my objection to the current system. One well-known example of zero star status is the Bath Royal United Hospitals NHS Trust, yet the respected health management consultants, Dr Foster, goes out of its way to praise that hospital as excellent in the treatment it delivers to patients.

Equally, a high star rating need not necessarily indicate good care. That is because the target indicators can often be selective. For example, waiting times for outpatient appointments relate only to the first appointment and not to subsequent ones, although there are twice as many follow-up appointments as first appointments. Similarly, with cancelled operations, only those operations cancelled on the day are counted in the figures, not operations cancelled on the few days preceding that.

The following shows how blunt an instrument a star rating is. One specialist acute trust was rated by the Audit Commission as very good on achieving NHS Plan targets and on most measures of financial and performance management. Another acute trust performed poorly on NHS Plan targets and was rated poor managerially, including significant financial management failings and no signs of imminent improvement. Yet both those hospitals achieved a two-star rating from the Department of Health. The Audit Commission found that, on average, three-star trusts were likely to achieve only 69 per cent of NHS Plan targets compared with 66 per cent in two-star trusts—3 per cent separating two-star and three-star ratings. That small difference hardly seems enough to warrant the very favourable treatment that three-star trusts receive and two-star trusts miss out on.

Star ratings ought to be abolished and I therefore do not think CHAI should be required to award them every year. They are profoundly misleading; and their knock-on effects, whether good or bad, are unwarranted. Exactly the same argument applies to CSCI and the star ratings of local authorities that it is required to award under Clause 77. For the same reasons, those ratings are also unrepresentative and misleading. If we must have targets, the language of performance of those targets should be devised by CHAI and CSCI themselves. It should be a linguistic rating, not a crude numerical one. The Minister will need to do an exceptional job in defending this element of the Bill if he is to start convincing me that these provisions have a value. I do not believe that he can do that. I beg to move.

The Chairman of Committees: If this amendment is agreed to, I cannot call Amendment No. 282A.

Baroness Barker: I rise to support the noble Earl, Lord Howe, on Amendment No. 282 and to speak to Amendment No. 284.

Earlier this year, not long before the House rose for the recess, I spent several hours in the A&E department of a large hospital. It was perhaps one of the most informative experiences I have had and has informed me extremely well for our debates on this Bill. At seven o'clock in the morning, when the newspaper shop opened, I went to buy a copy of the

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Guardian, as one would, and saw that the A&E department that I was visiting had achieved a low star rating. I was profoundly glad that I did not have the job of telling the people in that department, in the middle of their twelve and a half hour shift, that they were not doing a good job. That is one of the reasons why my noble friend Lord Clement-Jones and I are happy to put our names to Amendment No. 284. The current star performance rating takes precious little cognisance of what patients, other users and clinicians actually feel. It is a management, target-driven process.

I live in an area where people can go to one of two hospitals, both of which offer some of the same services. Given my age group, I know people who will sing the praises of the gynaecology and maternity unit at one of the hospitals but not set foot in the other. Others hold an entirely different opinion. I am not sure how they have reached their conclusions although I am sure that they have good reasons. There is perhaps one main reason why these amendments should be accepted and it relates to the provision of specialist services. I have taken part in various debates in your Lordships' House on specialist services, particularly neurological services. Many neurological patients say that locating good services simply by means of word-of-mouth recommendation is one of the most difficult tasks that they face.

Hospital star ratings do not meaningfully reflect that information. Star ratings by themselves are a crude target. Like the noble Earl, I should like to see the back of them. If they are allowed to continue, they should be the product of consultation with those who really know how hospitals work or do not work and what is wrong with them. I am therefore very pleased to attach our names to Amendment No. 284.

Lord Peyton of Yeovil: I should like very briefly to support as warmly as I can the amendment which was moved in such reasonable terms by my noble friend. I have just one question to ask. Who will actually award the performance rating of each body on behalf of CHAI and what training will they have for dispensing what amounts to a very serious measure of power in this instance? We have to be very careful about giving the power provided in this clause to people who have not had very meticulous training. I hope that the noble Lord will at least take the matter seriously. If he does not, I hope that my noble friend will return to it on Report.

Lord Turnberg: I must admit to sharing some of the concerns behind Amendment No. 282. I share the concern about the reliability of the star system, which I, too, believe is rather a blunt instrument for assessing the abilities and facilities to deliver care for patients. I fear that the correlation between stars and what patients want may not be anywhere near exact. However, I think that there is a need for some form of performance rating. After all, what is CHAI about if it does not try to assess how care is provided in those hospitals? I should like to see not star ratings, but a performance rating that takes a much broader and

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much more sensitive look at how care is delivered. I am not sure that removing the phrase "award a performance rating" will change anything. I think that one can change the star system without removing that phrase.

Baroness Cumberlege: I should very much like to support what the noble Lord, Lord Turnberg, has just said. I know that it is very difficult for the Government to reverse once they have gone down a particular line. In this instance, however, is there not a case for trying to get back into the National Health Service some real confidence in the present system? Perhaps we will have to change the words and reinvent the assessment. However, as the noble Lord, Lord Turnberg, and my noble friend Lord Peyton rightly asked, who is going to do it? Nevertheless, the present system lacks such credibility. There is so much cynicism about it, not necessarily so much among members of the public who I do not think quite understand all the nuances, but certainly among members of staff who are being judged by the system and think it unfair.

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