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Put people before Burnham’s platitudes: Competition in healthcare benefits patients

29 July 2014

29 July 2014

We are used to political parties trying to claim credit for any positive development that happened during their time in office. The Labour Party’s current stance on healthcare is the exception to this rule. It represents the rare phenomenon of a party denigrating one of the best bits of its legacy.

In the mid-2000s, the Labour government managed to inject a dose of competition into the once sclerotic provider-centric NHS. If shadow health secretary Andy Burnham is now positioning himself against the entry of private providers into the NHS, he is really positioning himself against one of his party’s biggest achievements.

It is due to Labour’s legacy that patients now have a greater degree of provider choice, that NHS hospitals are now paid according to what they actually do (which improves incentives), and that private providers can compete with NHS providers.

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That, at least, is the situation on paper. We know from patient surveys that patients’ experience of healthcare delivery on the ground is a bit different. Too many GPs have boycotted patient choice right from the start; many of them have kept referring patients as they see fit, without even informing them about their right to choose a provider. They kept particularly quiet about the option of choosing private/independent sector care.

And yet, despite the NHS doing its best to fight off outside competitors, some of them have succeeded against the odds. Between 2006 and 2011, NHS spending on treatment delivered by non-NHS providers almost doubled in real terms, rising to about 12% of the secondary care budget.

Part of this is to do with PCTs’ commissioning decisions, but part of it is directly driven by the choices patients make. Insofar as patient choice has been realised, private providers cannot turn profits unless patients choose to go there. Thus, calls to end the ‘privatisation’ of the NHS are really calls to end patient choice. From the perspective of an NHS purist, patient choice is dangerous. What if patients care more about an individual provider’s reputation than about who owns it? If you see the presence of private providers as a desecration of a noble institution, you have to take that choice away from people, because the risk that they make ideologically impure decisions is just too great.

But those who care more about outcomes than purity should welcome the entry of private competitors. Private providers are not per se better than NHS providers. But there is good evidence that competition has had a positive impact on quality and efficiency in healthcare, and the entry of private providers (or even the threat of entry) can drive competition. Private provision is only a problem if it is introduced over people’s heads, but the solution to that is to go further in expanding patient choice, not to fight off private companies.

Burnham’s ‘people before profits’ phrase is a nonsensical platitude. In a market or even a ‘quasi-market’ setting, the way to make profit is to give people what they want. Let’s have more of what people want and let those who provide it earn a handsome profit from doing so.

Kristian Niemietz is a Senior Research Fellow at the IEA


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Show comments
  • Peter Stroud

    I recently needed a cataract operation, on both eyes? I was given the choice of the local NHS hospital, and a private clinic. Both have excellent credentials. I chose the private clinic, and cannot speak too highly of the treatment. No doubt the NHS unit also operates to as high a standard: but the private clinic must have competed on cost. Incidentally, I was provided with prescribed medicines from the private dispensary: at no cost.

    • Terry Field

      The NHS is cost-uncompetitive. Always has been – where it knows -or cares – what its procedure costs are in the first place.
      Phaco is universal – but it recently was not always found in NHS hospitals – primitive or what.

  • Colonel Mustard

    I detest Burnham. Apart from his latent fascism, never far below the surface, he pulls that same whining supplicant face when he is peddling his emotional blackmail that Yvette Cooper uses. It is the face of constant spoilt protest and grievance.

    • Paddy

      Yes, it is the face of empathy and for Cooper she is very very concerned.

      Miliband is consulting with an autism expert so he can master it too.

      • telemachus

        Paddy
        Ignore Mustard
        He detests anyone who does not have a platinum credit card

        • Inverted Meniscus

          No he just detests fascist Labour politicians like any other person who believes in democracy.

        • Colonel Mustard

          Another lie. I don’t even have a credit card.

          PS I don’t think Paddy is on your side…

    • Terry Field

      He even puts the accent on

  • Alexsandr

    Why does anyone listen to Burnham on health. he should be in Jail for Stafford.
    how many died?

    • Inverted Meniscus

      1,200 unecessary deaths.

    • Paddy

      On Labour List they say the deaths are Tory propoganda!

      • Alexsandr

        on labour list they say discussing FGM is racist. Nuff sed really.

    • Terry Field

      He is responsible and should be in prison in my view

  • David B

    The line “People before Profit” is really the embodiment of Labour’s position on every issue. Any private sector involvement in what they consider the “Public Sector” orbit must be avoided, regardless of the benefits it might bring to the public.

    The NHS is about “Free at the point of use”. Providing the best care should be an overriding consideration. Burnham and Labour want and need the NHS for political purpose and will be happy to see care standards fall if it improves their poll rating.

    • http://owsblog.blogspot.com Span Ows

      “…and will be happy to see care standards fall if it improves their poll rating.

      Correct. This will be another sound bite though, repeated ad nauseum by the BBC doing the Labour party’s bidding and having coordinated programming; then latched onto by other media using the same term either conscious or not that they are using Labour’s marketing phrases.

      Andy Burnham is particularly slimy and sinister but always gets good coverage and never really tested or asked about you know what (how many deaths?)

    • telemachus

      telemachus. has fairly recently consumed health and was shunted by the Commissioners to a private hospital for my operation
      I was truly appalled at the flagrant commercialism that pervaded all medical actions
      I was “thrown” out in pain after the operation because the bed was contracted to another NHS patient that day
      I received a bill for the pain killers I was given to take home
      The dressing I had on the “business area” was 1cm too short and when I asked about the leak the nurse told me that she was only funded for the size of dressing I had
      The final straw was when I was leaving with my wife there was a violent argument at the desk between someone from I assume accounts in the private hospital and a lady who looked to be in her late 80s about an exorbitant bill(it sounded)
      *
      I recount this not for sympathy but to say that in England as opposed to the US we are used to treatment needs being paramount not the chequebook

      • David B

        You should write fiction for a living. Oh wait you do!

        • telemachus

          Would you like a copy of the bill for pain killers (£8..06 plus VAT)?

          • David B

            That would be fun! You do know that drugs are zero rated for VAT!

            • telemachus

              Aplos
              I have looked at the bill and it is £8.06 total

              • David B

                Very good Tele, we believe you thousands won’t

          • Alexsandr

            you could have told them to shove it and got an NHS prescription from your GP.. Oh, that will cost you £8.06 too.
            you idiot.

            • telemachus

              I have looked at the bill
              It is a private hospital bill for £8.06 which arrived the day after I was thrown out
              NHS prescriptions are similar but differ by 1p (8.05)
              PS there was no VAT added sorry

              • Holly

                I wouldn’t have even let you in.

              • Inverted Meniscus

                There was no bill either because all of this is just an obvious fiction to accompany this article.

            • Holly

              I knew it!
              I just knew it.

          • Inverted Meniscus

            No we have had quote enough of your lurid imagination and lies today.

            • Holly

              Must be the £8.06 meds.

              • Inverted Meniscus

                Could he be seeking a cure for his socialist nuttery? Never.

          • Inverted Meniscus

            Drugs are zero rated for VAT so we know that to be bollux and you have to pay for a prescription on the NHS you idiot.

          • Holly

            Is that like a prescription charge then?

            • realfish

              It is. No 2 son was discharged from an NHS hospital with pain killers to take home (and a bill for £8.06).
              It’s what happens.
              Pay up Tele.

          • Bandmomma

            A bargain!!

      • Inverted Meniscus

        You have the makings of an excellent novel here. This is pure fiction.

      • saffrin

        Had your lot not been so keen to massage the unemployment figures with your public sector non-jobs, the money could have been spent on healthcare and medical staff, trained at home and not the millions of NHS bureaucrats.

      • the baracus

        Telenazi is just a child trying to wind you up. The best reply to this is to ignore him…….

      • Nick

        How long would you have liked to stay in your comfy bed? Most medical procedures involve subsequent pain. That’s why painkillers were invented. Whether you hurt in a hospital bed or your own is immaterial. If you had needed further treatment you would have stayed in your bed. There’s more than one, you know. If you opt for another night i a hotel then the guest booked in is merely allocated another room.
        You should surely have been grateful that you were getting out of hospital so quickly and that another unfortunate patient could take your place. In mid-Staffs you’d have been lucky to get out at all.
        Incidentally, I doubt that you were physically thrown out (emotive language), I doubt that the desk operative was from accounts (that’s just your assumption) and I doubt there was an exorbitant bill (ditto).
        Don’t tell stories without being able to back them up with facts.

      • Holly

        Hey, nearly telemachus…
        Plod on…plod on.

      • Airey Belvoir

        The mental image your leaking ‘business area’ conjures up has neccessitated the use of a bottle of mind bleach.

      • Terry Field

        Bullshit – perverse codswallop.

  • rtj1211

    Let us be clear, there is no mandate for privatisation of the NHS, either in the 2010 manifestos of the coalition parties nor in the coalition agreement itself.

    If what you argue here is true, then let candidates at the 2015 election argue for it and see if they get a mandate to do it.

    Until then, respect democracy.

    • P_S_W

      Presumably because, as the article states, the last Labour government did that sometime between 1997 and 2010.

    • HJ777

      So you didn’t read the Conservative Manifesto then.

      iI explicitly said that it will give patients the freedom to choose any healthcare provider that meets NHS standards and can do so within the NHS price.

      It seems to be you who doesn’t like democracy.

      • David B

        The way Miliband was elected leader of the Labour party with the block votes of a few “men in grey suit” union barons, you would know that democracy means what the unions tell Labour!

      • Andy

        And the Conservative Party has a 60+ seat Majority in England. Mandate enough I would have said.

    • David B

      Please define privatisation? Do you consider the provision of GP, dental or dispensing services through the private sector to be privatisation, because all three have been that way since the start of the NHS.

      If it is acceptable to provide some services through the private sector then why not others. Why should someone be made to wait for a MRI scan or a hip replacement because the local hospital is over worked, but a private sector hospital has free capacity. That is ideology before people!

      What Burnham is doing is trying to scare people into thinking that privatisation means you will need your credit card or insurance to go to the hospital. As anyone who has been to a hospital under Labours outsourcing rules will tell you, it is still “free at the point of use” and at the end of the day that is all you want when you are in pain – a quick, efficient and free service!

      • Andy

        Quite so. The question which should be asked and answered is why does the State have to own, manage and run a hospital ? Most of the great hospitals were built by private philanthropy and belonged to Trusts before the State stole them, without compensation one might add.

  • Terry Field

    Labour will win the election in 2015 – the repulsive lot will buy enough votes – and that is one key reason I left Britain – now a ‘naturally’ socialist state.

    • dado_trunking

      … for France, one assumes?

      • Inverted Meniscus

        He left to get away from your sockpuppets lad.

      • Terry Field

        Ulan Bator actually

        • dado_trunking

          Ah yes – the work in the first, retire in the third world routine. Gotcha.

          You will perhaps not care but those who are still here will need to prepare for an invasion, given what we just established was the way the world worked.

          • Terry Field

            I have some concern for local English conditions – I have some investments here; some of my family is there, but their circumstances are comfortable, and they are able to purchase sufficient local staff expertise to give them a pleasant quality of life.
            That is not yet threatened by the minimum wage – but people seem to be more self-awarein pushing for advantage there.
            Any social change in England will arise from the collapse in world resources coming from climate change. Local starvation is quite probable, but I have anticipated this by paying in some stocks. I have purchased a small secure industrial location, well protected by armed guards, where foodstuffs are kept for my family’s use.

    • Andy

      I fear you are right. The Fascists will probably win next year, but that is because we have an electoral system that they themselves have successfully gerrymandered, and the hideous BBC which spouts their lies at every verse end.

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