What might Boris Johnson’s restructuring plan mean for the NHS?

A planned restructuring of NHS England could have a significant impact on its architecture, its relationship with government, which NHS bodies are responsible for which issues, and the role – and future – of its chief executive, Sir Simon Stevens.

Denis Campbell www.theguardian.com 

Foundation trust hospitals

In 2002, Tony Blair instigated the creation of foundation trust hospitals in England, sparking a row with his party. The plan was to liberate the best hospitals from central government control and encourage them to compete with each other to provide better care. There are 217 NHS trusts in England, of which 150 are foundation trusts.

They were handed unprecedented freedom to set their own financial plans and decide clinical priorities. For example, while they can incur a deficit, non-foundation NHS trusts have to break even. They also have different governance arrangements.

Abolishing foundation trust status could hand the Department of Health and Social Care (DHSC) the sort of controlit has over non-foundation trusts, allowing the health secretary to be more directive and interventionist over how hospitals spend their money and the action they take to tackle waiting lists, for example.

Integrated Care Systems

Since Stevens became chief executive of NHS England in 2014, he has sought to unwind the fragmentation of the service’s set-up that was a legacy of the coalition’s Health and Social Care Act 2012. He set up 44 sustainability and transformation partnerships (STPs), one for each area of England. They are voluntary, informal groupings of different NHS trusts – those providing acute, community, mental health, specialist and ambulance services – and sometimes local councils too.

Eighteen of these STPs have metamorphosed into integrated care systems (ICSs), and the plan is for the remainder to follow suit. ICS members collaborate closely but the bodies currently have no legal standing. However, under plans being studied by Boris Johnson’s new health and social care taskforce, all ICSs could become legal entities. They may be given the responsibility and budgets – possibly running into billions of pounds – for tackling workforce, financial and waiting time problems across their region, rather than individual trusts each doing their own thing.

However, this would disrupt the existing NHS financial and accountability regimes because, as one senior NHS official said, “they would be powerful new beasts in the NHS jungle that everyone else would have to work out their relationship with”. There would be new power flows between the ICSs and national NHS leaders and they would drive forward the integration of health services, and potentially health and social care, that ministers, Labour, NHS bosses and patient groups all want to see.

Payment by Results

Currently, NHS-funded healthcare providers in England receive much of their income under a system called Payment by Results. Providers receive a standard payment under the NHS “tariff system”, which is a set of fixed prices that it will pay for treatment, such as a visit to A&E or a surgical procedure.

There is concern that Payment by Results encourages hospitals to treat patients who may benefit from another form of care, such as physiotherapy rather than a knee replacement, and runs counter to working together in the patient’s interest.

The new taskforce is considering replacing it with a system under which care providers, or groups of care providers, would be paid for entire courses of care rather than individual episodes. While this would not affect district general hospitals’ income significantly, it may be harder to apply to specialist hospitals such as London’s Royal Marsden cancer hospital, which take patients from far outside their areas, and ambulance trusts, which operate across STP/ICS boundaries.

National NHS organisations

There is frustration in Downing Street, the DHSC and the Treasury that some NHS bodies have not performed well during the Covid-19 crisis and need reform. It is an open secret in Whitehall that Public Health England, an executive agency of the DHSC and thus already under its direct control, will not survive in its present form as ministers blame it for the poor implementation of coronavirus testing and tracing. There is also frustration that Health Education England, an arm’s-length body, has not done enough to tackle NHS staffing problems that have left it short of about 100,000 personnel. However, it is not clear what new arrangements would replace the current setup.

Simon Stevens

In his six years as NHS England’s chief executive, Stevens has exploited the operational independence of the role thanks to the last Conservative shakeup of the NHS in 2012. Previously, he won plaudits for telling MPs publicly that Theresa May was “stretching” the truth when talking about how much money her government was giving the NHS. He has used his position to push ministers to take action on obesity, the gambling industry and – last Sunday on the BBC – social care. However, some ministers and aides in Downing Street resent Stevens’ past tendency to speak out, what they see as his “invisibility” during the coronavirus crisis, the independence he enjoys and what they portray as his lack of accountability for rising waiting times and hospitals ending up in the red. If the proposals that emerge from the taskforce limit his power, Stevens may choose to consider his future.