My mission statement

The times we are working in now need a great deal of accelerated change and there must be no negotiating that down. So my mission statement for this part of my consultancy career is to be clear that there needs to be and will be a lot of change from the work that I do with individuals and organisations and if organisations don’t want that, then it is probably best to go somewhere else.

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On the relationship between competition and integrated services.

Filed Under (Competition, Reform of the NHS) by Paul on 12-05-2011

The RCGP document The Government’s Health Reforms. An Analysis Of The Need For Clarification and Change has continued a very important debate about the relationship between the need for integration and the development of competition in the NHS.

If the Government were to start their reforms again, one of the things they would do would be to outline the problems with the current NHS system that they think their reforms will solve. Their failure to do this in 2010 gave the distinct impression of a set of reforms looking for a reason to be introduced.


If they started again they would probably begin by saying that we need NHS reforms that will create much better value for money. They would then have to demonstrate how the reforms would bring that about.

If this were the first rationale for reform then I would think that the second would be the creation of integrated care pathways. Once we move away from a view of the NHS as being the blue lights of A and E and elective surgery, and once we recognise that the vast majority of NHS care is actually aimed at patients with Long Term Conditions, the need for integrated care pathways becomes very obvious.

There are several things wrong with the current mainstream model of NHS episodic care.

Firstly, for the majority of people who need care for their long term condition, the episodic approach to care fails to provide the underpinning support that patients need to construct a whole pathway in which they feel safe. In most long term conditions if there is a coherent patient pathway it is created by the patient and not by the NHS.

Secondly, more than anything this is caused by the Latin categories of primus and secundus. The split between primary and secondary care, and the very different organisation of these two models, has meant that there are very different and usually hierarchical approaches to medicine. Most consultants in secondary care would see themselves as being ‘in charge’ – because they are specialists. Some GPs would see themselves as being ‘in charge’ because they look after the overall care of the patient.

Getting something genuinely integrated out of these two different systems is a problem.

Thirdly, a great deal of the care of long term conditions is run from the most expensive part of the NHS system – the hospital. For as long as the care is episodic and run from various very different institutions it is not possible to create the incentive structure which could ensure that more is carried out in better value for money settings.

So episodic care fails to incentivise pathways in ways that really matter.

Fourthly, because care is episodic it means that the patient does not feel that they can develop self management of their own care by depending on a strong pathway. Self management feels as if it has to replace, rather than supplement, NHS care for long term conditions. If the care were itself integrated patients might feel that the integration of self and NHS care would be easier if there was only one, integrated, NHS system with which to deal.

For at least these reasons (and I am sure many more) the case for integrated care is a strong one.

And whilst the NHS has looked at how this might work, the vast majority of care for people with long term conditions is still episodic. The NHS seems to have powerfully resisted the implementation of integrated care to scale.

This is despite the fact that the Kings Fund and the Nuffield Trist have both been powerfully ‘pushing’ this model for some time. The intellectual case has probably been made, but it has not created the conditions for integrated activity to scale.

Therefore if the Government were to start its reforms again, many people would want to judge them against how effective they are at creating integrated care.

The RCGP in fact do this in the document above. And they, along with many others, believe that the use of competition is in some way anathema to the creation of integration. Surely, competition breaks relationships asunder –  the opposite of integration which brings organisations together?

Section 33 of their document makes this point   .

“The Bill seeks both competition and better integration, which can be seen as mutually exclusive; it is difficult to see how competition rules could be framed to deliver both of these objectives. The fear is that it will no longer be possible to deliver integrated services in practice, especially where integration relies on close collaboration between different providers and commissioners, and could be seen as anti-competitive.”

The first thing to say is that this paragraph seems to believe that the NHS in 2011 is full of integration that Government reforms seem destined to smash up. This is just not true. As I said above the NHS has failed to deliver integrated services to scale. They are not there at the moment to be ‘spoiled’ by competition.

On the wider point the RCGP are not alone as seeing the aim of integration and competition as in some way ‘mutually exclusive’.

But in most other walks of life competition helps to drive integration and I will show how it will do in the NHS as well.

If I want to build a very large building I need the integration of a wide range of different skills and services. These services will come from a wide range of different professions and trades. It demands integration of a scale that makes an integrated NHS service look easy. And how do I do that?

In the past I might have run tens and tens of competitions between the different skills and professions and then tried to stitch all of these together into the organisation of building. That would lead to constant strife.

What I now do instead is contract with a logistics company that takes the  responsibility of bringing together the pathway into an integrated whole. My contract is with them. They then construct a series of contracts with the different parts of the service that need to fit together. They are expert not only in getting value for money but in getting the various skills to work together.

There is strong competition here. The logistics companies compete with each other to demonstrate not only value for money, but how they will ensure a seamless integration. The various skills then compete with each other for the work from the logistics company and work hard at not just doing their thing well but demonstrating how this will fit in with the whole set of relationships.

Most goods and services are now organised this way. The division of labour creates higher and higher levels of skills and the logistical organisation of those skills provides an overall service which, for example, delivers wheat from the farm as bread in our kitchen

It’s full of competition.

It’s full of integration.

On the other hand the current NHS contains very little competition

And very little integration.

How would this competition to create integration work in the NHS?

A Commissioner – either old style PCT or new style GP Commissioning Consortia – would issue a tender for a service that provides seamless integrated healthcare for example,  for the whole diabetes pathway. The tender states that the task of the bidder is to bring all this together into a seamless pathway. The commissioner would expect that every part of the pathway would be of a high quality and it would also expect that the integration into an overall pathway would be of the highest level.

There would be a competition between the different prospective integrated providers and the episodic parts of the provision would – for each competing pathway – have to show how they could work well together. The local hospital might find itself a part of several competing pathways finding a series of different ways in which they play a part.

The Commissioners would choose the best based upon both the parts of the pathway and the integration.

The pathway provider that wins the tender would then have to demonstrate that they were keeping the pathway at the cutting edge of provision over the lifetime of the contract.

This contains competition and meets the need of any competition law to be applied. What I would like, if I were a person with diabetes, is a number of different choices within this pathway. The integrated pathway co-ordinator might say that there are three different providers that they have organised to provide me with education about my diabetes. Each of those providers would only be allowed to be a part of the pathway if they agreed to all the aspects of integration that made it work

Lots of integration. Lots of competition.

A word on Kaiser Permanente. I know that those in favour of the reform of the NHS must not mention the US because everything that comes out of it is wrong, but many people who believe in integrated care believe that Kaiser Permanente is a model where integration has happened because they are not in competition. The pathways are created with their own staff and fully integrated. So where is the competition?

When you talk to the people who run Kaiser they find this amusing. They point out that every aspect of their model springs from a competitive process because each person or employer who decides to have their health care organised by Kaiser do so in competition with many other health care providers. The member of the public or the employer can choose to move regularly if they are not provided with the best health care.

Just to quickly stress this is not a model that anyone is suggesting for the NHS.


5 Responses to “On the relationship between competition and integrated services.”

  1. I don’t think that construction of a large building can be compared with management of LTC patients.

    People don’t stay in one fixed place like a building, I’ve read that 10% of population moves home annually. So surgery churn must be similar.

    If a GPC or whatever they are called goes thro a competitive tendering process – lengthy and costly by nature – across a care pathway, based on a number of patients in an area for instance, that tender will have to account for fluctuations in its inevitably moving population.

    I don’t see how it can be practical for complex LTCs. Yes, it works with routine hip ops or cataracts but not LTCs, especially this with co-morbidities, transitions from childhood to adulthood modes, life-limiting disabilities.

    Or am I missing something in your argument Paul?

  2. As you mention above, the incentive for integrated care for LTC has to come from the commissioners, and it could have come from “an old style PCT”. Therefore, the government’s reforms are unnecessary and the rationale for them is bogus.

    The DoH is now funding integrated care pilots that join up PBCs, GPs, and social care. Each PBC decides on priorities, and in Norfolk it is firstly the frail and elderly. Copmmissioning, driven by funding for innovation, will drive through this integration.

    The acute providers don’t have financial incentives to initiate integrated care. Payment by results was designed to boost supply and reduce waiting lists and it worked.

    In the USA there are integrated care organisations like Kaiser and the Mayo Clinic that are exemplary. And there are managed care insurance companies like Aetna and United Health that provide disease management programmes. But after 20 years, managed care integrated care is haphazard. There are too many incentives in the USA for doctors and owners to get rich. The system needs better regulation to integrate care.

    Clearly the commissioners can provide incentives (even through competition) for innovation in service. But free market competition is not the way to go.

  3. I do worry about the example of diabetes used here and by the odd Stephen Bubb interview in the FT – the evidence is pretty clear that carving out elements of care often means that other elements are not managed well. Most of the patients that cost the most have more than one condition. This is like deciding that having hired the builder you have decided to cut across their work and ask another contractor start fiddling with their work. Good luck aattributing responsibility when that goes wrong.

  4. Paul – and still there are people who believe we should not have competition in the NHS!
    Are they seriously saying patients should not have a choice? To have choice you need a market. A market gives you competition. As you rightly point out, Paul, it is about having competition in the right place and to do this we have to understand what is important to patients, not doctors or management.

    I fear too many of the ruling elite in the NHS would prefer a world in which patients are docile, punctual and thoughtless – “we know best” because most patients are unable to think and judge independently to enable them to make choices a market could offer.

    These are the real forces of conservatism in the NHS.

  5. If the US system is so good how come it delivers such poor quality outcomes to the majority of the population with such high admin costs?

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