Setting sail for stormy waters

Virginia Bottomley’s recent announcement of plans to significantly extent the scale and scope of GP fundholding marks a watershed in British health policy. It is the clearest sign yet that the government plans ultimately to develop a full-blooded healthcare market, abandoning in the process both health authorities and any notion of planned services. In doing so, it is dramatically destabilising the delicate balance between purchasers and providers, pitting the interests of doctors against patients, and fundamentally undermining some of the founding core principles of the NHS.

The growth of fundholding has been a quiet revolution in the health service. Although it was slow to take off, fundholders now provide medical care for over a third of the population of England and Wales. By widening the range of services purchased by fundholders, allowing smaller practices to be eligible for the scheme and, most radically, piloting ‘total fundholding’ in which GPs will be responsible for purchasing allhospital services, the government has stated loud and clear that The Future is Fundholding. By the next general election it seems virtually certain that the majority of the population will be registered with fundholding practices.

Yet, disturbingly, the costs of fundholding are unknown. It seems clear, then, that fundholding is being driven forwards for ideological rather than straightforwardly economic reasons. The not-so-hidden agenda is the abolition of health authorities and the coercion of all GPs into fundholding practices. Given the reduction in health authority powers in the wake of the Langlands review, and their domination by Tory supporters, this policy will only meet resistance from a few inner city GPs.

Over the next few years, once all hospitals are trusts and all GPs are fundholders, the first stage of the restructuring of the NHS will be complete. The government will be happy to sit back and watch ‘market forces’ execute the second and more radical stage by proxy. Of course, the healthcare market won’t actually be free, instead being manipulated by state funding policies and regulations which favour some players at the expense of others. As competition intensifies the inevitable effect will be to concentrate the number and power of both purchasers and providers through mergers and take-overs. Privatisation will become the obvious course as the funding screw is tightened, and both fundholders and trusts become increasingly dependent on income from private insurance.

The final destination of this process remains open to political forces and professional resistance. Perhaps trusts will start to clamour for the freedom of the private sector or GPs will rebel against being corralled into HMO-like super-fundholding schemes. The privatisation of the NHS, while a very real possibility, is not yet a foregone conclusion. But as with all policies driven by ideology rather than a desire to improve services, there will be casualties along the way.

First, the shift to the chaotic world of fundholding will cause major destabilisation in many trusts, as small changes in income have dramatic effects on the financial viability of hospitals. Second, patients’ trust in GPs will be jeopardised as doctors balance the provision of services against budgets spread ever more thinly. Finally, the principle of equal treatment for all will crumble away. Increasingly, the care you receive will depend on where you live and the policies and financial viability of your local fundholder. If you are chronically sick or require expensive services you will be an unwelcome addition to the practice list.

The NHS has set sail for uncharted and stormy waters, and there is clearly no intention of changing course. As the government takes its hand off the rudder, and the winds of the open market gather force, there must be a real question as to whether the ship can survive the journey.