Quango advisers hit out on NHS wasted cash

The advice of a high powered board of business people set up to counsel the labour government on working with the private sector was systematically ignored by ministers and civil servants, according to a resignation letter seen by the Financial Times.

The commercial advisory board – whose members included investment bankers, lawyers and a former regulator – quit in September, declaring it was “wasting its time” as the government moved to scrap much of the second wave of independent sector treatment centres (ISTCs) on which it was, in part, advising.

These centres provide an alternative source of surgery and some diagnostics.

The board’s resignation letter says that in spite of “positive assurances at various meetings” with ministers and senior civil servants over four years, “it has never been apparent to the board that any subsequent action was taken as a result of the advice that it gave, both orally and in writing”.

Sir William Wells, the board’s chairman and a former chairman of the NHS appointments commission, writes in the resignation letter that “certainly no feedback was ever received”.

He says: “[The board’s] greatest concern has been, and remains to this day, that despite a number of presentations to the board on the subject, no one has ever been able to explain satisfactorily how taxpayers’ money was spent in the NHS, and what checks and balances were in existence to ensure the delivery of effective value for taxpayers.”

His comments come as the department’s commercial directorate is being revamped. It will no longer be a semi-freestanding central purchasing authority, but will be reduced in size and regionalised – becoming a consultancy body to primary care trusts, which are to take over locally the purchasing of independent-sector care for NHS patients.

The ISTC programme has been dramatically scaled back in spite of the department preparing an unpublished glossy document singing its praises. Entitled ISTCs – The Story So Far, it uses data up to July last year to argue that the centres “force the NHS to become more productive”, that they will suppress “year-on-year” increases in the cost of waiting-list surgery, and that their productivity, on a range of measures, is better than in NHS-run units.

Prepared by the commercial directorate that procured the ISTC programme, the document accepts that the centres need to be better integrated into the NHS.

But it also argues that even if the whole second wave of ISTCs had gone ahead, there would have been only “localised pressure” on NHS providers. Without a sufficiently large private sector “there will be no competitive tension” to drive down cost, raise quality and improve accessibility, it says, and the market will not be large enough to be “self-sustaining”.

From:
http://www.ft.com/cms/s/0/7d350fc8-a1dc-11dc-a13b-0000779fd2ac.html

On July 27, 2006 Heath Direct posted: Independent treatment centres (ISTC)s savaged by Health Select Committtee

The House of Commons Health Select Committee has scathingly reported that the Independent Sector Treatment Centres (ISTC)s have produced only a tiny fraction of the NHS's total capacity, ISTCs are not necessarily more efficient than NHS Treatment Centres, there is no proof about whether the ISTC programme represented value for money and accused Labour Ministers of muddled and "inconsistent thinking".

At the end of 2002, the Government decided to commission a number of independent sector treatment centres (ISTCs) to treat NHS patients who required relatively straightforward elective or diagnostic procedures. Several objectives were ascribed to the ISTC programme, including:
* Increasing elective capacity available to the NHS in order to reduce waiting lists and times;
* Reducing the spot purchase price in the private sector;
* Increasing patient choice within the NHS;
* Encouraging best practice and innovation;
* Stimulating reform within the NHS through competition.

Health Direct were surprised that the Department made no attempt systematically to assess and quantify the effect of competition from ISTCs on the NHS. Given its importance, the Department should have ensured that this was done from the beginning of the ISTC programme in 2003.

The Department of Health and the Secretary of State have, over the course of our inquiry, given answers which have shifted in both fact and emphasis as time has gone by, and the statement of the current position by the Secretary of State leaves several important questions unanswered.