Medical emergency

12 July 2010
Peter Smith, director of Procurement ExcellenceI believe a single procurement issue could determine the result of the next election. Let’s extrapolate from the current coalition ‘honeymoon’ to 2014 – and let me stress this is not what I want (or even expect) to happen. But it is a possible scenario… The economy has barely recovered. Cuts have been more painful than expected, with a major effect on schools, universities, police forces, and defence. Strikes and the odd riot have become commonplace. There is a festering resentment of the NHS from other public sector workers – and many taxpayers – who wonder why, given its ring-fenced status, it does not seem to be delivering. And then, one after another, a series of high-profile stories hit the press.
  • Having been handed funding powers, the largest GP consortium in the health service runs out of money 10 months into the year and begs for more. The press discover it has been paying £3,000 a day to a top US consulting firm for “procurement advice”, and the same firm has entertained many of the GPs in the consortium to a lavish day out at Wimbledon.
  • Another consortium is found to have the highest death rate post-heart attack in the country after awarding the contract for heart surgery to a controversial Romanian company who are pioneers in a ‘revolutionary low-cost treatment’.
  • The EU starts legal action against the UK for persistent breaches of its regulations in the awarding of health contracts. These include cases where GP consortia have ignored EU rules, failed to advertise opportunities, or awarded contracts improperly and where there were clear conflicts of interest. Payouts to suppliers who challenge procurement decisions start to rival medical negligence claims as a burden on the public purse.
  • A GP consortium is found to have awarded contracts for health advice on exercise and lifestyle to a lady who is also known as Madame Thrash and performs regularly at ‘specialist’ burlesque evenings. The News of the World is disgusted at this waste of taxpayers’ money and features three pages of photographs to emphasise their horror.
  • A new breed of GP consortia managers, many ex GPs or PCT bosses, are found to be earning more than the prime minster, or in some cases, more even than a junior executive at the BBC. Some combine this role with their regular GP work and are now making £250,000 plus a year. Indeed, GPs salaries have grown by 25 per cent in three years since their 2011 ‘tough’ new contract was agreed.
With poll ratings sinking, the third health minister in 18 months tries desperately to change the commissioning system, but with the election looming, all is lost.... As you can tell, I am really not sure about the idea of GPs commissioning services.  Having PCTs as the commissioners was far from perfect; but a lot of effort has gone into trying to develop procurement skills in those organisations, and there was at least a sensible degree of demand aggregation in that structure. A total of 500 GP consortia in the proposed new system; that’s an awful lot of procurement events to go wrong... I hope for his sake, the health system, and the taxpayer that health secretary Andrew Lansley knows what he is doing and has some really clear plans for how this is going to work, how capability is going to be built, and how the new ‘system’ is going to be monitored, governed and regulated. If those elements are not in place, then this has the makings of a disaster.
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