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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
WG1 Public Services

Speech by Andrew Lansley CBE MP

Shadow Health Secretary.

26th 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
  • Over 300 million consultations
Healthcare in the UK is predominantly in the public sector.
  • 86 per cent of healthcare spending is through the NHS.
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

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.