Hospitals need to innovate and compete, says health minister

BMJ 2010; 341 doi: (Published 08 December 2010) Cite this as: BMJ 2010;341:c7066
  1. Jacqui Wise
  1. 1London

Removing the current cap on the proportion of income that NHS foundation trusts can get from privately paying patients will give hospitals in England the freedom to innovate, the health minister Lord Howe has said.

Speaking at a conference on “hospitals in the new health service,” organised by the think tank Reform, Lord Howe said that, subject to consultation, the government would abolish the private income cap. “This will mean that hospitals will be free to innovate. We want them to be able to pursue commercial opportunities,” he said.

The aim is for all trusts to have foundation status by 2012-14. “We want them to be able to compete with other trusts on a level playing field,” said Lord Howe.

He told the conference, held in London on 6 December, that hospitals will be rewarded for doing everything possible to prevent readmissions. He wanted to encourage better management of long term conditions to reduce emergency admissions.

He said that the current landscape of healthcare is changing with the economic climate and with the challenges posed by chronic long term conditions such as diabetes and chronic obstructive pulmonary disease. “We can no longer afford to treat people in the same way as we have done,” he said.

“We need to treat patients in the most cost effective place, and often that will not be in hospital. There is no need for patients to receive dialysis, chemotherapy, and some minor surgery in hospitals.”

Lord Howe said that big savings could be made by reducing patients’ length of stay in hospital. He cited the example of hip replacement: depending on where you live, he said, the length of stay in hospital varies between 2.5 and 12.5 days, with no difference in clinical outcomes.

One of the themes of the conference was how the better use of data and technology has the potential to improve the care of patients and save money. Lord Howe said, “Over 80% of patients’ contact with the healthcare system is face to face. Many [contacts] are absolutely necessary—but are all of them?” he asked.

He said that technology has the potential to produce cost savings. For example, midwives in Portsmouth are using digital pens to write electronic notes. This has halved the amount of administration so that more time can be spent with mothers. It has also produced savings of £220 000 (€260 000; $350 000) a year there, he said.

Liz Kendall, shadow health minister, said that hospitals should not be allowed to compete on price, adding, “It is clear from the evidence that price competition reduces the quality of care.” She said that integration rather than competition should be the key word and that it was important to improve primary care so that services could be shifted out of hospitals and into the community.

Steve Smith, chief executive of Imperial College Healthcare Trust, said that digital technology had transformed the way that people live and manage their lives but asked why this technology had not yet transformed the delivery of healthcare.

Professor Smith cited some positive examples showing what technology can achieve, such as the NHS’s Choose and Book system, which allows GPs and patients to book referrals to hospitals online, and the NHS Choices website, which helps put individuals in charge of their healthcare.

He also cited applications for the iPhone and other mobile devices that give patients health information and devices that can access diabetes management software, allowing patients to record and monitor blood glucose concentrations in real time.

But he added: “So much more could be achieved through electronic patient records to allow patients and the healthcare professionals involved in their care to manage their care better.”


Cite this as: BMJ 2010;341:c7066

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