Feature

General practice enters the market

The White Papers signal the end of the general practice monopoly and begin a process of deregulating primary care, argues Steve Iliffe

This government may be dying, but it intends to leave its successor a difficult legacy. The NHS is being privatised in stages, and Labour is to preside unwittingly over the end of this process. The Tories often deserve the nickname ‘The Stupid Party’, but they have learned from the fundholding debacle.

Fundholding was meant to ‘kick start’ the internal market and make hospitals sharpen up their act. It did that to some small extent, but it also fuelled the ambitions of some GPs who wanted a slice of the power long denied them by hospital specialists. And it triggered resistance among those who saw in fundholding a glimpse of the future: competition between British-style health maintenance organisations. The result was a confusing conflict between market-oriented fundholding and its rival, locality commissioning, in which both sides expressed a common aim — to shape the health service according to their own interests.

This was not what the government had in mind. Fundholding had become to its GP advocates an end, not a means, and locality commissioning had restored some sense of planning to the idea of a primary care-led NHS. The problem was clear. GPs did not want to be subject to competition, but instead sought management positions in the coming managed market. The solution was equally clear. The monopoly that GPs had over primary care had to be broken, so that they would be forced into competition with one another and with other primary care providers. Then the market mechanisms for a privatised health service would be nearly complete, and the security provided by a certain role in a service with fixed boundaries would be replaced by the insecurities of competition in a market with fluid boundaries.

Stephen Dorrell hinted at the shape of things to come early in 1996 in an issue of Purchasing Bulletin, when he used two pages to describe the potential of a primary care-led NHS without mentioning general practice once. Nobody in the profession took the hint.

The spate of documents released at the end of 1996 that fed into the current Primary Care Bill spelled it out. GPs would be given three choices: stay as independent contractors to health authorities, but working under increasingly tight control and direction; branch out as mini-trusts; or join existing trusts as salaried employees.

If the government is successful, those GPs who retain their traditional relationship to HAs will need to work within increasingly complex rules which distinguish between ‘core’ and ‘non-core’ tasks, and will spend ever more time on administration to maximise their income from a widening range of fees for specific services. The days of the open-ended and vaguely defined contract are over, and the age of quality standards, guidelines and accountability has begun. The consolation prize is security of tenure, for these doctors will remain on the medical list where their contracts are guaranteed until the age of 70.

Those who opt for status as mini-trusts will not only compete with other trusts to provide primary care, but will eventually lose their security of tenure. The ambitious GP-trust will then need to fend off competition from the local acute hospital trust, or the community trust, either or both of which may offer primary care services. They will be able to do this once they attract GPs into their organisation, employing them on a salaried basis, but probably on relatively short-term contracts. Those practices which opt for linkage to existing trusts will be sheltering under expansive wings, but at the price of their GPs losing autonomy and security of tenure.

The result is the end of general practice as a nationwide system of medical care in the community, distinct from more specialised services. It will continue in its traditional form in some parts, but its advocates will struggle to survive and, as time passes, may well seek shelter in bigger organisations — just as fundholders have tended to aggregate into larger units. Generalism will continue in many forms, and no wise trust will dispense with it; European and US experience teaches that direct public access to specialist care is expensive, so there will still be a place for GPs inside acute and community trusts.

Is this a problem? Not at first sight, because the separation of general practice from hospital medicine on one hand, and other community services on the other, has bedevilled the development of good quality medical care for decades. Compartmentalisation of services has forced an unnatural compartmentalisation of patients’ problems, with only limited escape through repeated but usually disappointing attempts at joint working. A single service combining generalist and specialist skills, however organised, may prove a more attractive option than the old divide.

There are two particularly obvious hazards in this process. The first is that trusts may develop primary care to retaliate against the fundholders who have destabilised them through contract shifting. A large and aggressive trust could recruit the patient base from under fundholding without necessarily being able to deliver primary care of the same quality. The US experience of such competition between providers is that the bad drives out the good, so while many would enjoy the fundholders’ discomfort, the damage to primary care might be less desirable.

The second hazard is adverse selection, with competing primary care providers looking for healthy people who make little use of services and avoiding the sicker, older, poorer population which costs more to care for. Here the beleaguered fundholders may find a defence against aggressive trusts, creaming off the younger and more affluent with offers of physiotherapy and counselling in-house, while the trust’s primary care services are left with the seriously sick. The case-mix matters, because funding for the most ill is unlikely to match their needs, forcing trusts with primary care ambitions to provide limited services to those who need them most. The experience of cash-strapped US public hospitals struggling with escalating demand and dwindling staff morale would then be repeated in Britain.

Could a Labour government reject this legacy? Probably not, given the interests mobilising behind it and the obvious benefits of local mergers of generalists and specialists. But it could keep overtly commercial players out, maintaining a truly ‘internal’ market while controlling the process of innovation tightly — through the HAs — to minimise destructive competition at local level.

Trusts which can negotiate local deals with the majority of GPs to create a single service should be encouraged to do so. Attempts to offset the power of fundholders by developing alternative sources of primary care should be monitored closely to avoid poor services emerging for poor people, and the capitation basis for funding services should be modified to reflect patterns of illness more accurately. Above all, the public needs to be involved in the debate about the future provision of health services, with a Labour government emphasising the issues of needs, justice and equity.