The current purchaser efficiency index has resulted in perverse incentives and a distortion of clinical priorities.1 In the name of increased efficiency, cost saving measures have been rewarded while few attempts have been made to assess the quality of care provided. When attempts have been made, variation has often been shown in the quality of care delivered and the outcomes achieved by different providers.

In a significant and welcome change from the previous administration, the new government recognises these problems and proposes several measures to deal with them—at every level of the NHS. At the centre, a National Institute of Clinical Excellence will promote clinical and cost effective care by producing research based guidelines. National service frameworks will also set out the patterns and levels of service which should be provided for major …