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Author: John Storey

The politics of NHS management

Updated Wednesday, 10th January 2007

John Storey looks at the politics involved in managing an organisation such as the NHS.

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The three programmes ‘Can Gerry Robinson Fix The NHS?’, reveal a number of important truths about today’s NHS – such as the continuing tensions between managers and doctors, the multiple occupational and professional groups which divide healthcare workers into different silos and the persistence of customs and practices which impede efficient and effective care. In the third programme, the wider political and economic realities which help explain these phenomena start to emerge.

The programmes make apparent that there are many areas where efficiency gains could be made – for example, through more engaged leadership and management. Yet if a greater throughput of patients was to be achieved, the workload would increase and thus the required payments would increase.

While the hospital trust would grow its revenue, the purchaser the Primary Care Trust (PCT) does not have the extra funds to pay for this extra work. The same is true for most other PCTs in the country. Healthcare is rationed in this and other ways.

"difficult political decisions have to be made"

If the system was working to the principles of conventional economics, either the hospital would need to reduce its capacity to match its flow of work, or, there would need to be a move to flexible tariff so that the more efficient hospitals attracted more work and resources and the less efficient had some, or even ultimately all, of their resources diverted.

At present this cannot happen because it would be unacceptable politically – consider the recent intervention by Hazel Blears, Cabinet Minister and the Chair of the Labour Party as she joined a street protest against the proposed closure of a maternity unit in her constituency – and infeasible economically. The PCTs cannot negotiate flexible tariffs.

The logic of this kind of competition would see work being attracted from some hospitals to others. This prospect is often viewed in NHS circles as ‘predatory’.

The system operates through a curious and complex mix of planning, regulation, contracting and managed market mechanisms. The balance between these different mechanisms is evolving however and difficult political decisions have to be made as the consequences of the different choices become evident.

What are your views on the ways politics influences the direction of the NHS? Share your views in the comments area.


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