Reforms to NHS commissioning in England
Authors: Chris Ham
Journal: BMJ (2006)

The government's reforms to the NHS in England have focused on strengthening the role of healthcare providers through the creation of NHS foundation trusts and the procurement of additional capacity from the independent sector. Much less attention has been given to the role of healthcare commissioners. New guidance from the Department of Health describes how commissioning will be developed and also gives an update on the progress of the whole NHS reform programme.

There will probably be up to 100 NHS foundation trusts in England by the end of 2007 compared with 40 today, further enabling “a decisive shift from top-down to bottom-up” and completing the job of strengthening the role of healthcare providers.1 In an important development, the update guidance trails the possibility that providers of community services may become foundation trusts. Community NHS foundation trusts would enable the services provided directly by primary care trusts to be run independently of their commissioning functions. Equally important is the proposal that NHS foundation trusts should be able to operate outside their own areas and beyond traditional settings for acute care. This would allow horizontal integration of providers through the formation of foundation trust chains, and vertical integration as some organisations providing hospital care added intermediate care and community services to their portfolios.

On system management and regulation in the NHS, the update is important as much for what it hides as for what it reveals. The Department of Health promises that more detail on the future of regulation will come in a consultation document this autumn. This suggests that ministers have not yet decided whether to create a single NHS regulator that brings together the functions of Monitor (the current independent regulator of foundation trusts), the Healthcare Commission (the body that safeguards quality in the NHS), and other agencies.

The government's plans for the future of “payment by results” (the method for paying providers from a fixed tariff for each individual case treated in NHS hospitals) are equally vague, with little progress evident since the last update on the reform programme in December 2005. This is particularly worrying, given that providers of specialised services such as paediatrics say that the tariff is inadequate2 and given the need for incentives to shift services from hospitals to the community for people with chronic diseases.3

Much more progress has been made on commissioning. An annex to the update, twice the length of the main document, describes the roles of practice based commissioners, primary care trusts, and specialised commissioning groups. It also signals a commitment to harness through national procurement the skills of companies with expertise in commissioning. The new guidance focuses only on hospital services but promises more detail later in the year for other services such as those for people with mental health problems and other long term conditions.

Whether the government's plans will succeed in strengthening commissioning depends on two factors. The first is the ability of the newly reorganised primary care trusts to perform better than their predecessors. The second is the willingness of general practitioners and primary care teams to use practice based commissioning.

The signs that the trusts can perform better are decidedly mixed. On the upside a development programme to support them is under way, and a national model contract for them to use with providers will be published in the autumn. The ability of primary care trusts to access expertise on commissioning from the private sector—for example, in information analysis—should also help.

On the downside, most primary care trusts are in the early stages of formation, and it will take time for them to build up the necessary capabilities. Managers in both the NHS and the wider public sector lack expertise in commissioning. The detailed advice in the update's annex on managed care techniques to be used by commissioners reinforces the feeling that the Department of Health is not confident that primary care trusts, left to their own devices, will deliver what the NHS needs.

Furthermore, the new guidance suggests that primary care trusts should offer additional incentives to persuade general practices to participate in practice based commissioning. This reflects doubts about slow uptake of practice based commissioning and lack of engagement among practices.4 General practitioners' substantial increases in income for work done in their practices under the new general medical services contract may make the offered benefits of practice based commissioning less attractive. Commissioning will require harder work, not least because practices will have to collaborate with each other to change the behaviour of powerful hospital providers.

This update on the NHS reforms and the new commissioning guidance fill gaps in the government's strategy and offer a more coherent narrative of the direction the reforms are taking. But how commissioning will work beyond hospital services is not clear, and difficult questions have still to be answered about payment by results and regulation. Above all, there is a lingering doubt that ministers have put the cart before the horse in developing the role of providers before that of commissioners.