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WG1 Public Services. Speech by Andrew Lansley CBE MP Shadow Health Secretary. 26 th June 2006. The National Health Service is the largest publicly-funded health service in the world: £84 billion (2006/7) 1.36 million staff 11 million hospital operations 750 million prescriptions

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WG1 Public Services

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Wg1 public services

WG1 Public Services

Speech by Andrew Lansley CBE MP

Shadow Health Secretary.

26th June 2006

Wg1 public services

  • The National Health Service is the largest publicly-funded health service in the world:

  • £84 billion (2006/7)

  • 1.36 million staff

  • 11 million hospital operations

  • 750 million prescriptions

  • Over 300 million consultations

Wg1 public services

  • Healthcare in the UK is predominantly in the public sector.

  • 86 per cent of healthcare spending is through the NHS.

Wg1 public services

  • NHS services are free at the point of service, with the exception of dentistry and some prescriptions.

    (20 per cent of prescriptions attract charges)

Nhs spending

NHS Spending

  • Spending on the NHS has doubled over the last eight years. It now represents 7.7 per cent of GDP.

  • At current rates of spending increases, UK healthcare spending would reach the 2001 French levels by 2008, and the 2001 German levels by 2011.

Value for money

Value for money?

  • Costs in the NHS have also been rising:

    in the hospital sector by 9.7% in 2004-5; by 7 per cent in 2005-6; and by 6.5 per cent in 2006-7.

  • Lack of productivity gains mean activity levels have been rising at about 3 per cent per annum.

  • Doctors in the UK are the best-paid in Europe.

  • 2.2 doctors/1,000 in UK, versus

    3.4/1000 in France and Germany

Wg1 public services

  • Lack of productivity gains and poor adoption of best practice have led to the call for accelerated reform. (e.g. day case rates, length of bed-stay, avoidance of unnecessary hospital admissions).

Reforms include

Reforms include:

  • Payment-by-results, based on an NHS Tariff – Healthcare Resource Groups (HRG – similar to DRG system).

  • Contracts with independent (private sector) providers:

    250,000 operations so far and diagnostic tests tended for.

  • Patient choice for elective surgery by 2008.

  • Decentralised commissioning.

Other reforms are needed but lacking

Other reforms are needed but lacking:

  • Extended patient choice and voice.

  • Independent regulatory structure.

  • Open supply for independent providers.

  • Extended freedoms and competition for NHS providers.

  • Budget responsibility held by General Practices or independent providers.

Key issues

Key Issues

  • Financial control.

  • Future funding.

  • Lack of effective public health interventions and rising social health issues e.g. obesity/alcohol/drug misuse/STIs.

  • Developing NHS-wide IT infrastructure.

Key reform challenges

Key reform challenges:

  • How to make patient choice effective?

  • How to make commissioning effective in managing demand and securing effective supply?

  • What will be the competitive response from NHS providers and the independent sector?

  • How to secure professional staff and engagement?

  • How to secure national consistency of service standards and quality in a decentralised and market-orientated system?

  • How to avoid unnecessary demands without co-payment?

Regulatory challenges

Regulatory Challenges

  • Extent of price control and of price competition.

  • How to secure effective quality control and avoid price/quality trade-offs.

  • How to secure universal service and avoid service impacts of provider failure.

  • Structure of pharmaceutical purchasing.

  • How to secure cost-effective choice of treatments and reconcile resources with NHS service expectations or entitlements.

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