Sir David Nicholson's latest bright idea for the English NHS

Sir David Nicholson's parting shot to the NHS is to suggest scrapping the hated 'purchaser-provider split' - and replacing it with something far worse.

Alex Nunns
10 June 2013

Oh no. Sir David Nicholson, the Chief Executive of NHS England, has had an idea.

He may be in the middle of the reform-to-end-all-reforms in the NHS (quite literally, as it’s the reform to end the NHS), but that hasn’t stopped him thinking up another reform anyway.

Nor has his own resignation dampened his spirit. He’ll be gone by March next year, leaving his job completely of his own free will and not at all because of anything to do with the role he absolutely did not play in the Mid-Staffordshire hospital disaster. Nicholson’s parting gift to the NHS is a “major review of NHS strategy,” because it makes perfect sense to have a major review right before a new boss takes over.

You might have thought that the Health and Social Care Act, the biggest disorganisation of the English health system since 1948, would be enough for now. But it seems that was just part of a longer process, and with his time as Chief Executive running out Nicholson wants to reveal the rest of the vision while he still can.

So what kind of institutional torture is the NHS in for next? According to the Health Service Journal:

“Sir David Nicholson has told HSJ it is time to question whether “the straightforward commissioner-provider split” is the best way to organise care for some communities.”

But wait – isn’t this good? The separation of the commissioners (the people who buy treatments on behalf of patients) from the providers (the hospitals and others that actually do the healthcare) is the foundation of the market in the NHS. Since it was introduced by the Tories in 1991 it has forced some bits of the health service to buy stuff from other bits. Originally that was called the internal market. Once the NHS was divided in this way, it made it much easier to get the private sector in, which New Labour did by offering favourable terms to companies. That was a rigged market. And then the Coalition Government came along with the Health and Social Care Act and threw the whole thing open to “any qualified provider.”

Campaigners have been calling for the “purchaser-provider split” to be abolished for decades because, for starters, it just doesn’t work if what you want is an efficient, equitable health service. And now here’s the Chief Executive of the NHS saying:

“We’re very interested in thinking about integration of commissioning and provision and we can work with Monitor and others on how that could work, in particular circumstances and against particular sets of challenges.”

He also condemned the “cookie cutter foundation trust pipeline” through which all NHS providers are being squeezed. This is forcing them to become independent trusts so they can compete in the market – a logical complement to the purchaser-provider split. Trying to achieve foundation status was a major cause of the Mid-Staffs scandal.

So is he repenting of his sins? Is he leaving us with a plan to heal the damage done on his watch? No.

“Sir David called on the service to look closely at US organisations Geisinger and Kaiser Permanente, which serve as insurer and provider for a defined membership. He said: ‘We need to be much more creative about those sorts of models of integration, which go beyond simple provider integration.’”

Oh. He seems to want to end the purchaser-provider split by making both provider and purchaser private, and uniting the two. In other words, companies would decide if the NHS will fund a treatment for their customers, and then perform it too. Patients would get a balkanised health system and taxpayers would get to subsidise private shareholders.

It was 2002 when the privatisation crowd first started talking about one of the American companies Nicholson references, Kaiser Permanente. A discredited study comparing Kaiser and the NHS claimed to show that the American organisation “gets more for its dollar.” New Labour bought this hook, line and sinker, and the Tories didn’t even need persuading. They all took inspiration from this shining product of the most expensive, inefficient health system ever devised by Man. It’s enough to make you wonder whether everything that has followed over the last decade has been part of a plan…

You start out with an integrated NHS that is one of the most efficient in the world.

Then you split the purchasers from the providers.

Then you privatise the providers.

Then you privatise the purchasers.

And then you've abolished the purchaser provider split! Except in the meantime you have successfully moved a public health service into the private sector. And in just three simple steps.

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