Learning From a Policy Mishap in the English NHS

Do you want more evidence that health care reform can be a hugely difficult process? If so, then take a look at the political and policy tumult over the British government’s health care reforms to the English National Health Service. In England, radical reforms that were proposed last year were put on “pause” in March and have just recently been heavily modified in the face of strong opposition, political controversy, and near universal policy criticism. 

The troubled health care reforms in England should be of strong interest to those outside the U.K. We all know that nearly every developed nation is struggling to slow rising health care spending. Demographic changes, chronic disease, and lifestyle choices are rapidly pushing up the cost of health care. Factor all of these in with an economic slowdown and it’s a recipe, for those in control of federal budgets, to waking up in the middle of the night. The challenge is what to do about it. The English experience illustrates that coming up with the solution is vastly more difficult than identifying the problem and that there is no easy legislative solution. It illustrates that it’s not enough to worry about the technocratic details of health policy; timing, political calculations, and public sentiment matter greatly.

To understand the recent tumult in the English NHS, it’s necessary to provide a bit of context about the English NHS. When Tony Blair was elected prime minister in 1997, he inherited control of a health service that was creaking at the seams. Waiting times for elective surgery was being measured in months and years, mortality rates for acute conditions like stroke, cancer, and cardiovascular care were among the worst in Europe and only about 35 percent of the British public was satisfied with the health service. That prompted Blair to launch an ambitious program of public sector reform together with introducing huge increases in spending. 

From 1997 through 2007, Blair nearly tripled real terms spending on the NHS. More than that, the Blair government altered the way hospitals and NHS providers were paid, introduced patient choice and provider competition into the system, and injected rigorous performance management into the system. These reforms provoked a fury of opposition from professional unions. 

However, the Blair government managed to push through their reforms and the results were dramatic. Waiting times went from being measured in months and years to being measured in days or weeks; the mortality rate for heart attacks in England fell by nearly 50 percent and in 2010, patient satisfaction in the NHS was the highest it had ever been. To be sure, the NHS was and is far from perfect, but the reforms had a significant impact.

Enter David Cameron and his newly appointed health secretary, Andrew Lansley.

The new government saw the fiscal writing on the wall and rightly argued that the government needs to slow the long-term growth rate for health care spending in England. Likewise, they also identified areas where the quality care in England lagged substantially behind what was being delivered in other countries, including the U.S. In short, the new government saw the need to confront the challenge that every developed country is going to face with its welfare state: the pressure to slow spending, pressure to do more with less, and the need to become more productive. 

At the core of their proposals were three central elements. 

  • First, they wanted to give family doctors (general practitioners) control over the bulk of the NHS budget. GPs would form together into so-called GP consortia and the groups would get money for each of their patients and be in charge of arranging local services on their behalf.
  • Second, they wanted to rid the NHS of any management located between the central government and these newly formed GP consortia purchasing bodies.
  • Finally, they wanted to expand provider competition in all quarters of the NHS.

And they wanted all these changes to happen over the next 2 years. 

On the policy front, there were three central flaws to the government’s proposals. First, there was no evidence that general practitioners were up to the task of or even wanted to be involved in purchasing care on behalf of patients. The end result was that the government’s proposals amounted to putting 75 percent of the government’s overall £100 billion budget in the hands of an untested entity. 

Second, the government ostensibly declared war on managers. Speeches were loaded with rhetoric criticizing hospital management and NHS bureaucrats. The problem is that according to work we’ve produced at the Centre for Economic Performance, good management is vital for good patient outcomes. 

Finally, the pace of change was too rapid. The NHS had just finished a decade of rapid reform and the last thing that it needed was more structural upheaval. More than that, given the huge short-term budget pressure the NHS was under, the timing of the bill just never made sense since structural health system reforms generally cost money in the short term on the promise of long-term savings. 

More than that, the health secretary never got the details right. His legislation was expansive and many of his individual proposals were perilously short of specificity and rife with inconsistencies. This meant that he took flack from all quarters and thrust David Cameron into an echo chamber of policy criticism and political pain. 

As a result, the government hit “pause” on their reforms, and invited an expert panel to scrutinize the bill and make recommendations for improvement. After a 3-month “listening exercise,” the panel reported their findings this week. The findings, which have largely been accepted by the government, included slowing down the pace of change, retrofitting these GP consortia to include more qualified staff, and changing the language in the bill to promote more integrated care. The changes to the government’s reforms are, on balance, sensible. However, this massive policy blunder begs the question of what went wrong, how a year of legislation came undone, and how other countries can be more successful at tackling these collective problems. 

The first broad lesson from the failed reforms in England is that health reform has a tendency to get mired in technocratic details and policymakers can lose sight of the forest for the trees. We need to keep in mind basic principals that are necessary to improve quality. 

In England, as is the case in many other countries, purchasing care effectively is staggeringly difficult. We struggle to buy care that represents value for money and this blunts incentives for providers to innovate. The government in England argued that this had to do with the structure of the purchasing bodies. I disagree. I believe many of the problems in health care stem simply from a lack of data. There is just not enough good data on provider performance or evidence on what good pathways of care look like in order to know what value looks like. So, unless we get good data that allows us to differentiate between good and bad hospitals, we will never improve the way care is purchased. Excellent health care organizations, such as the Cleveland Clinic and MD Anderson, are fueled by data and benchmarking. 

Second, health care reforms take time to bed in, and there is a risk that electoral cycles force new governments to put in place new policies before policies from their predecessors have had time to yield dividends. 

In England, the ink was just starting to dry from the legislation passed by Tony Blair. Indeed, his reforms were just beginning to produce improvements in clinical quality and productivity. The new government should have worked to build on his reforms, rather than starting from scratch. Every new administration is eager to launch new programs, but if we get new sweeping reforms every decade, none of the new health policies will have time to produce tangible benefits and the only thing tax payers will see is the costs of introducing change. This is particularly true in the United States, where the savings from the Affordable Care Act are not slated to materialize until after 2016. 

Finally, under-promise results and over-deliver benefits. In health care, the public are interested in the results of the system, not about how it’s wired. In England, the government hugely oversold the bill as the most ambitious shakeup of the NHS in decades. However, they could never articulate what the reforms meant for patients next week, next year, and a decade out. A health reform is ambitious if it results in significant returns for patients; a health reform is technocratic if it just changes the wiring of the system. Technocratic reforms are necessary, but unless policymakers and politicians can articulate what they mean for patients, they will never muster widespread support, especially when public satisfaction with the system being altered is already high. 


Columnist Zack Cooper is a health economist working at the Centre for Economic Performance at the London School of Economics. His column for the Health Policy Forum considers health policy and politics, often from the international perspective. Columnists are regular contributors to the Health Policy Forum who pose their own opinions and policy positions in the realm of health care and health policy. As a leading nonprofit health care research and consulting institute dedicated to improving human health, Altarum encourages open discussion and debate about the many challenges in health care today. All postings to the Health Policy Forum (whether from employees or those outside the Institute) represent the views of the individual authors and/or organizations and do not necessarily represent the position, interests, strategy, or opinions of Altarum Institute. Altarum is a nonprofit, nonpartisan organization. No posting should be considered an endorsement by Altarum of individual candidates, political parties, opinions, or policy positions.

Add new comment

Click to Print