See below - actually little Alan actually said ' third rate leftish
academics' - from somebody who dropped out of his Ph.D. as well - not stupid
but definitely nasty. David Byrne
----- Original Message -----
From: Shapiro <[log in to unmask]>
To: <[log in to unmask]>
Sent: Friday, May 25, 2001 10:17 AM
Subject: Re: UK health care and privatisation briefing


> Dear All,
>
> This press release must have been seen by John Snow who interviewed Alan
> Milburn on news at 7 last night.  John Snow referred to criticisms of PFI
> from healthcare professionals and insisted on the point.   Alan Milburn
was
> distinctly rattled and referred to 'third rate academics'.
>
> The message is getting through.  Lets keep up the pressure.
>
> Also note the publication in BMJ of deaths caused by taking patients off
> critical care too soon.
>
> I am not sure if the press release below will have gone on the RadStats
> website.
>
> See quote from Radstats message:
> 'Following the suggestion (see below) Paul Hewson will add a news page to
> the
> Radstats website.
> So if you have any suitable material, please send it to Paul
> ([log in to unmask]) and he will put it on the website.'
>
>
>
> Janet & Ray Shapiro
>
> -----Original Message-----
> From: Alex Scott-Samuel <[log in to unmask]>
> To: [log in to unmask]
> <[log in to unmask]>
> Date: Friday, May 25, 2001 8:20 AM
> Subject: UK health care and privatisation briefing
>
>
> Health Policy & Health Services Research Unit
> School of Public Policy, UCL (University College London)
> 29-30 Tavistock Square, London, WC1H 9QU
> tel: 020 7679 4985; e-mail: [log in to unmask]
>
>
> BRIEFING NOTE FOR THE GENERAL ELECTION ON HEALTH AND
> PRIVATISATION
>
> SUMMARY
>
> This briefing assesses two points made by the Labour Party
> in its manifesto:
>
> 1) That the private sector should be allowed to
> deliver NHS funded healthcare and manage NHS hospitals
> 2) That health care will remain free at the point of
> delivery
>
> Increased costs
> · It is highly likely that the transaction costs of
> contracting with the private sector will be significant.
> Labour costs will rise in a competitive labour market
> whilst the evidence from the US shows that privately
> managed hospitals are inefficient and spend 34% on
> administrative costs compared with 12% in the NHS as a
> whole.
>
> Accountability and regulation
> · The increasing use of the private sector to deliver
> NHS funded health care requires regulation and new
> accountability mechanisms to be put in place. However
> Labour has already demonstrated its commitment to 'least
> burdensome regulation' and has sought to abolish Community
> Health Councils. Losing direct political control of service
> delivery requires new safeguards
>
> Evidence on efficiency and quality in the uk
> · Private healthcare in the UK has a poor record.
> Although there is a dearth of data on private sector health
> care private hospitals are far from being the 'Rolls Royce'
> institutions which Labour believes them to be. They have
> lower staffing levels and lower levels of clinical support.
> The NHS has also picked up the pieces of poor private
> sector performance. Last year there were 142,000 admissions
> from private hospitals to the NHS. · The NHS has for a
> long time experienced the efficiencies and effectiveness of
> privately managed services. Britain's filthiest hospitals
> are 'cleaned' by private sector contractors. In other areas
> of contracting out there is no evidence to demonstrate that
> delivery of services by the private sector has led to
> higher quality. Labour's faith in the private sector is not
> grounded in any firm evidence.
>
> What does the private sector stand to gain?
> · Labour seems to assume that the innovation and
> 'efficiencies' of the private sector can simply be
> harnessed to deliver public health goals. However few
> commentators have asked why the private sector would want
> to become involved in such a venture. Where are the sources
> of profit in health care? What will be required to get the
> private sector on board? · More importantly the
> fragmentation of the NHS a la Railtrack and the reliance on
> private sector contractors may impair Labour's ability to
> deliver public health goals.
>
> Care free at the point of delivery?
> · The Labour party's failure to make personal care
> free at the point of delivery has demonstrated that it is
> committed to redefining the boundaries of state funded
> provision. The New Health and Social Care Act puts in
> place mechanisms for NHS bodies to redefine free health
> care and to introduce charges for personal care
>
>
> Professor Allyson Pollock
> David Rowland
> Dr Neil Vickers
>
> 24 May 2001
>
> INTRODUCTION
>
> The Labour Party's manifesto commitment to allow private
> sector companies to take over the management of public
> hospitals is an extension of the
> concordat signed between Tony Blair and the Independent
> Health Association last year. However, the problems and
> pitfalls of pursuing such a strategy have rarely been
> articulated. The move away from a hierarchical, unified
> NHS structure to one which is severely fragmented has
> implications both for the cost of providing health care in
> the United Kingdom and the quality of the care that is
> provided. Care will be more expensive and quality
> standards will be at risk. The claim made by New Labour
> that it is not who delivers the service that matters, it is
> the quality of the care that counts, has a simple logic to
> it which discourages both scrutiny and public debate. There
> are however important issues at stake. Relying on private
> healthcare companies to provide state funded health care
> introduces new stakeholders into the system with a
> financial claim on NHS revenues. It will almost certainly
> lead to an increase in the administrative costs of the NHS
> and will move health care provision further away from
> democratic control.
>
> The Labour party has also committed itself in rhetoric if
> not in practice to maintaining health care free at the
> point of use. However whilst nursing and
> medical care is free at the point of use personal care can
> be charged for. The new funding arrangements for Care
> Trusts allow NHS bodies to charge for personal care. The
> Labour party thus seems intent on redefining the type
> of care that will be provided free of charge.
>
> THE COSTS OF THE NEW ARRANGEMENTS WITH THE PRIVATE SECTOR
>
> The NHS as a hierarchical and unified structure has despite
> its many critics provided a comprehensive free service that
> is also- according to accumulated OECD data -very cheap by
> international standards. Although it is very unfashionable
> to say so health systems of the 'command and control
> planning' type which have predominated in the UK and in
> Scandinavia have been remarkably successful in delivering
> high quality free care to whole populations. In contrast
> the health care system of the US which is market based and
> has diversity in provision has proved inefficient and
> costly. The NHS as a unified structure has two main virtues
> in terms of cost containment. It is able to control labour
> costs by remaining a monopoly purchaser and provider of
> labour and it operates with very limited transaction costs.
> Whilst the new arrangements proposed in Labour's manifesto
> and by the IPPR are as yet unclear a move further away from
> a unified structure will almost certainly incur new costs
> and lead to greater inefficiencies.
>
> · Contracting and transaction costs - the transaction
> costs of any contractual agreement are proportional to the
> complexity of the good being
> contracted for - thus refuse collection = low costs, health
> care = high costs. As one of the authors of the forthcoming
> IPPR report notes 'Monitoring consumes resources, the cost
> of which has to be taken into account in any overall
> assessment of a quasi market's contribution to efficiency'
> . In all international comparisons the NHS has
> traditionally scored highly on account of its low cost of
> administration which up until the 1980s accounted for about
> 5 % of health services expenditure. As a hierarchical
> structure the NHS thus had low administrative and
> transaction costs. However the introduction of the internal
> market and the fragmentation of the structure of the NHS
> led to an increase in administrative costs from 5% to 12%.
> The ratio between nurses and administrative staff fell from
> 3.5:1 in 1981 to 2:5.1 in 1996 . Whilst the new agreements
> with the private sector will be of a significantly
> different nature than the internal market of the 1990s it
> is clear that any further move away from a hierarchical
> structure to a contract based model will result in much
> larger monitoring and administrative costs than are
> currently found in the NHS.
>
> In the United States which has a mixed provision of care
> provided by public hospitals, for profit hospitals and not
> for profit hospitals administration
> costs are excessive. Within hospitals alone nearly a
> quarter (26%) of the budgets are spent on administration
> costs  . Within private sector for profit hospitals over
> 34% of the budget was spent on administration costs. In
> general overall costs of care were higher at for-profit
> hospitals. Thus if the new arrangements with the private
> sector are to deliver cost effective health care serious
> consideration will have to be given to reducing the
> administration costs.
>
> · Monitoring the true cost of care - when contracting
> for complex services such as care services it is very
> difficult for public bodies to monitor the
> true cost of care and to know when a price increase request
> is in fact justified. The complexity of the contractual
> arrangements means that there is great scope for private
> sector contractors to behave opportunistically. The
> Australian experience of private management of public
> hospitals has shown that contract prices have been
> renegotiated upward to meet the demands of the private
> contractor . Public authorities are thus susceptible on the
> pricing issue. In the UK market for community care it has
> been reported that those running independent sector care
> homes have threatened to evict residents if the public
> authorities do not meet their demands for higher fees .
> There is the worrying possibility that the same is likely
> to occur if public hospitals are privately managed
> particularly at times when the system is under stress.
>
> Relying heavily on non-NHS sources of provision leaves the
> government hostage to the demands of the private sector. As
> in the case of the railways the primary role of public
> authorities will be to ensure that private health care
> companies stay in business whatever the cost to the public
> purse.
>
> · Labour costs - Ironically allowing the private
> sector to employ staff will introduce competitive forces
> into the labour market which will drive labour
> cost up rather than down. Private hospitals will have to
> compete to attract highly qualified staff such as doctors
> and nurses who are in short supply. Economic theory would
> predict that this change will bring about a widening in the
> dispersion of wages and salaries and probably a rise in
> their mean levels as well. This prediction has been borne
> out in the United States where hospital wage rates have
> been found to be higher in competitive than in concentrated
> labour markets.   One of the major virtues of a unified
> hierarchical NHS is its ability to control labour costs in
> a way which competitive labour markets cannot.
>
> REGULATION AND ACCOUNTABILITY IN THE 'NEW NHS'
>
> The new arrangements for the delivery of services by the
> private sector raises important questions about how
> accountable the 'new NHS' will be. The democratic control
> of the NHS may have always been weak but the
> private healthcare sector has been and continues to remain
> unregulated and outside of political control. There are a
> number of important questions which Labour have failed to
> answer:
>
> · Regulation - Using the private sector to provide
> services for patients funded by the state means that
> stringent safeguards need to be put in place.
> The Labour government has already demonstrated its attitude
> to regulation. The National Care Standards Commission
> regulates the care of elderly and frail patients in private
> nursing homes. However, despite the fact that there is
> strong evidence to show that low staffing levels are
> associated with poor quality of care the 38 national
> minimum standards for Care Homes for Older People for
> England contain no requirement for minimum staffing levels.
>
> The government has also recently attempted to abolish
> Community Health Councils the only semi independent
> monitoring body within the NHS. How will
> complaints about private providers be investigated and how
> will the public's voice be heard under the new
> arrangements?
>
> Given that the government wants to establish a much larger
> private sector in healthcare, the pressure to
> under-regulate will be considerable. It is
> essential that public interests prevail over this pressure.
> So far the government has approached the task of regulating
> the private sector with kid gloves. The private sector has
> overwhelming and disproportionate representation on the
> government's Better Regulation Taskforce (which covers all
> aspects of private sector regulation). The government is
> also committed to introducing a bill to reduce regulatory
> burdens on the private sector . Any regulatory regime for
> the private sector must be transparent and free from
> capture from the private health care industry.
>
> · Accountability - accountability for service
> provision will come via a contract between an NHS trust or
> health authority and a private health care
> company. However, a contract with a privately managed
> hospital will require much more than stipulating just cost
> and volume. PFI contracts for privately managed residential
> care homes specify in great detail the quality of care to
> be delivered. However, there is a question as to how
> enforceable these contracts are, as it is easy to contest
> the meaning of each specification. This leaves plenty of
> scope for opportunistic behaviour by private providers.
> What legal remedies will be sought under a contract if a
> private healthcare company delivers poor standards of care?
> Will the NHS be liable for the actions of its contracting
> partner?
>
> The recent Sharman report into accountability for public
> expenditure highlights the difficulty of accounting for
> public funds when state services
> are provided by the private sector. The report makes clear
> that even where functions have been devolved to other
> non-governmental bodies government must ensure that it has
> robust mechanisms to safeguard the correct use of public
> money. How will public bodies oversee the way in which
> private companies managing public hospitals spend public
> money?
>
> USING THE PRIVATE SECTOR TO DELIVER PUBLIC INTEREST GOALS
>
> · The bargaining strength of public and private
> contracting bodies needs to be examined. What will be
> required to attract the private sector in to the running of
> public hospitals? What guarantees of 'trade' will private
> healthcare companies require before committing resources to
> a hospital? How well does this accord with either the
> efficient use of public money or the pursuit of public
> health goals?
>
> · Why would the private sector want to become
> involved in providing services to the NHS? How will they
> make profits? Why is it that Boots wants to run
> and own primary care facilities? Why is it that companies
> offering private health insurance i.e. Norwich Union want
> to become involved in primary care. The assumption made by
> government is that the private sector's efficiencies and
> innovations can be harnessed to improve on the delivery of
> public health goals. However, does the private sector see
> the new arrangement in this way? Will private health care
> companies wish to be harnessed?
>
> · Transferring management of public hospitals to
> private managers will also mean the transference of
> responsibility for resource allocation to profit
> motivated actors. Will resources be allocated according to
> need or according to other goals?
>
> · The running down of direct state provision will
> also lead to the fragmentation of the health service - the
> ability of government and or other
> public authorities to co-ordinate the delivery of health
> policy goals will be seriously curtailed. Planning will be
> impossible. Again the privatisation of the rail network is
> a good example of what occurs when a move from
> a hierarchical management structure to a contracting (and
> subcontracting) service delivery method takes place.
>
> WHAT EVIDENCE IS THERE TO JUSTIFY THE BELIEF THAT PRIVATE
> SECTOR MANAGEMENT IS EFFICIENT?
>
> · Evidence - What evidence is there to show that
> private sector management of public hospitals around the
> world leads to greater efficiency and higher
> quality care provision? The services within hospitals in
> the UK which have been contracted out - laundry catering
> cleaning - etc provide examples of private sector
> management of services formerly provided by the
> public sector. There has been no evidence put forward to
> demonstrate that the contracting out of auxiliary services
> has led to either higher levels of efficiency or higher
> quality services . Perhaps more importantly the
> recent naming and shaming of the dirtiest hospitals in
> Britain revealed that four out of the five trusts which run
> the 10 dirtiest hospitals employ private contractors to
> clean their wards.  In the market for community care the
> claim that the private sector is able to deliver higher
> quality at lower cost has been difficult to substantiate.
>
> A new form of managerialism is thus unlikely to solve the
> ills of the NHS. Unless evidence can be put forward to
> demonstrate that private sector
> management is more efficient and more likely to deliver
> much needed reforms the policy can only be justified with
> reference to the theoretical assumption that the market
> works best.
>
> HOW HIGH ARE HEALTH CARE STANDARDS IN THE PRIVATE SECTOR?
>
> · It is widely acknowledged that the private sector
> is not as good as the NHS at diagnosing and treating
> post-operative complications. The cause of the discrepancy
> is to be found in the fact that few private hospitals
> offer round the clock specialist care. In the private
> sector patients are typically admitted for some relatively
> routine surgical operation (cataracts, hips,
> hysterectomies, prostate operations). The procedure will be
> performed by a private consultant assisted by an
> anaesthetist. If medical complications do not present
> within a short time both specialists will leave the
> hospital. The patient is then placed under the care of the
> Resident Medical Officer (RMOs) or Officers and the
> hospital nursing staff. If, as happens not uncommonly, s/he
> suffers an anaphylactic reaction to the anaesthetic drug or
> develops a clot causing a potentially fatal obstruction in
> a blood vessel, s/he will need specialist care very
> rapidly: early detection of post-operative complications is
> the key to the patient's survival. If the patient is
> fortunate, s/he will be transferred to the NHS where a
> range of specialist services and equipment will be
> available. Otherwise, their risk of death maybe much
> greater than in the NHS. (The same of course applies if the
> patient suffers, e.g. a cardiac arrest, for reasons
> unrelated to the surgery.)
>
> · Last year, there were around 800,000 elective
> surgical procedures carried out in the private sector in
> the UK and there were 141618 admissions from
> the private sector into the NHS in England. These data need
> to be handled with care (they may be incomplete and
> admissions are not the same as procedures). But they are
> sufficient to indicate a problem that must be addressed.
>
> · The levels of experience and training of clinical
> staff in private hospitals give cause for concern. RMOs are
> usually junior doctors with little specialist training. If
> they do not recognise early symptoms, they will not be able
> to report them to the consultant. The same goes for nurses.
> The need for skilled nursing staff is greater in the
> private sector than in the NHS since there is less
> supervision by doctors. But specialist nurses are even
> rarer than specialist doctors in the private sector. Part
> of this problem stems from the fact that the private sector
> does not invest significantly in the training of medical
> personnel.
>
> · Over the last decade medical practice in the NHS
> has come under close scrutiny, especially following the
> setting up of the inquiry into medical
> negligence at the Bristol Royal Infirmary. However great
> these flaws will prove to have been, the fact remains that
> procedures do exist in the NHS to prevent a poorly
> performing doctor from putting patients' lives at risk.
> And following Bristol, the likelihood is that those
> procedures will be invoked with increasing stringency. The
> current regulatory framework places no obligations on
> private hospitals to identify or to investigate
> significant failures in medical practice. And there is no
> systematic counterpart to the NHS exercise in clinical
> audit.
>
> There are reasons to suppose that such failures will occur.
> Within the private sector medical practitioners work in
> isolation and the patient's clinical care is the
> responsibility of just one person. In the early 1990s, this
> led to a spate of perioperative deaths and very serious
> injuries in the private sector among patients having their
> gallbladders removed by keyhole surgery. (The demand for
> keyhole surgery came from patients. Unfortunately their
> doctors had little experience of what was then a new
> technique and the consequences were sometimes tragic.)
>
> · The Association of the Victims of Medical Accidents
> has investigated a number of cases of patients dying while
> undergoing treatment in a private
> hospital, in circumstance which clearly warranted a
> coroner's investigation, but where the coroner was
> dissuaded from undertaking a post-mortem examination. The
> National Enquiry into Perioperative Deaths (NCEPOD) in
> its 1995-6 Report commented on the disappointing response
> of the private sector to participating in its inquiry.
> Participation ought to be compulsory so as to facilitate a
> scientific evaluation of the standards of medical care
> in the private sector comparable to those that are ongoing
> in the NHS.
>
> IS LABOUR COMMITTED TO PROVIDING HEALTH CARE FREE?
>
> On health policy, Labour likes to claim that the choice
> before the electorate is between a Conservative Party that
> wants to abolish free medical care and a Labour Party
> committed to a modernised NHS 'free at the point of use'.
> This hard and fast distinction is not consistent with
> its rejection of the Royal Commission on Long Term Care's
> recommendation that personal care should be provided free
> of charge.
>
> In fact, Labour's NHS Plan and the legislation giving it
> legal force make ample provision for charging. So ample, in
> fact, that the private medical insurance industry may be
> about to receive the biggest boost to its fortunes since
> 1948 when the NHS was founded.
>
> Labour's NHS Plan contained two big ideas: care trusts (a
> new kind of NHS body) and intermediate care (a new setting
> for health and social care). Put
> them together and you get a potent recipe for massively
> increased user charges.
>
> Here's why:
>
> Care trusts will bring health care bodies and social
> services under a single umbrella. They will be purchasers
> and providers all rolled into one. Health care will
> continue to be free at the point of the use. But social
> care will be charged for. The government anticipates that
> care trusts will control about 75% of the NHS budget by
> 2004.
>
> Intermediate care refers to care provided in order to ease
> the transition from hospital to home. The government wants
> to create an extra 5,000
> intermediate care beds by the middle of 2004. Some will be
> in community hospitals, others in special wards in acute
> hospitals and some in purpose-built new facilities or
> redesigned private nursing homes. The plan also aims to
> introduce 1,700 extra non-residential intermediate care
> places.
>
> Regardless of where it is given, the DoH envisages that for
> the first episode all intermediate care will be free at the
> point of use. 'Based on current practice an intermediate
> care episode should typically last no more than six weeks.
> Many episodes will be much shorter than this, for example,
> 1-2 weeks following acute treatment for pneumonia or 2-3
> weeks following treatment for hip fracture.' . Thereafter,
> NHS care-meaning nursing and medical care-will be provided
> free of charge; but means-tests and user charges will apply
> to housing and living costs and to the costs of 'personal
> care'. It requires no great acumen to see that care trusts
> will have a strong interest in bringing patients into the
> intermediate care sector as quickly as possible and in
> defining personal care as broadly as possible. For both
> these steps will help them maximize revenue from user
> charges. Issues are bound to arise over the status of many
> ordinary tasks of daily living (mostly centering on
> washing, feeding and toileting). When is giving a patient a
> bath, for example, medical care and when is it personal
> care? It will be up to care trusts to say.
>
> These changes will greatly favour the development of an
> expanded market in private medical insurance. It may be
> that insurers will offer policies that
> take effect at the point where the care provided by care
> trusts ceases to be free. Holders of such policies could,
> for example, be entitled to longer stays in hospital with
> the insurer meeting the cost no longer covered by the
> state. Unlike health authorities the new Care Trusts do not
> provide comprehensive geographic coverage rather resource
> allocation is on the basis of GP practice lists or
> enrolees. There are currently no restrictions in the Act
> barring care trusts from selecting low risk patients or
> from encouraging patients to buy private health insurance
> for preferential treatment. The risk is that differential
> risk pools will emerge creating inequities across care
> trusts and between patients. Ensuring fairness will be a
> complex and expensive and bureaucratic administrative task.
>
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