Risky Reform Syndrome: the NHS's life-threatening complaint

Streams of money are pouring into the National Health Service as a raft of changes kicks in, aiming

There are turbulent times ahead. It's rather like receiving an unwelcome visitor: the NHS has always had to cope with unwanted and sometimes unexpected frenzies of media interest. The knock on the door cannot be long away.

Already the mutterings have started. The odd warning shot has been fired. Within the service some say that, in England, "this is the end of the NHS as we know it". And it is true that the government has embarked on a programme of change more radical and more extensive than has ever been attempted. More to the point, it is doing so at what can fairly and perhaps ominously be described as breakneck speed.

There are plenty who believe the changes are wrong or unnecessary - but even for those of us who support the broad direc- tion of travel, the size of the agenda and the speed of change are a major cause of concern. The stakes are high and, now, so too are the risks.

Consider what is being attempted. Around the country, many services are in real financial difficulty. Last year the health service failed to balance its books, albeit by a modest sum, but that disguised areas of the country and individual services facing large debts and without the means to meet the public's rising expectations of them to deliver.

The old days have gone, when one part of the service bailed out the other, as have the old flexibilities that allowed NHS trusts to carry forward deficits and delay capital spending to meet revenue crises. The new order demands that all live within their means. Only foundation trusts are able to borrow to invest in new services. Nor will there be much sympathy for the plight of the NHS - its whopping real-terms increases of more than 7 per cent a year up to 2008 have made it the envy of the rest of the public sector. The fact remains that much of this has gone on extra pay for doctors and other staff (see Mark Jopling, page 32), increased drug costs and medical negligence claims, as well as on the single-minded and, thus far, largely successful efforts to reduce waiting times. As a result, the system's capacity to absorb new demands is limited, yet those demands are huge, and there is scant evidence that the extra amounts ploughed into pay will produce the increases in productivity and efficiency that ministers expect.

Add to this the impact of the European Working Time Directive, which has restricted the hours worked by junior doctors, marry that with a new commitment to slash waiting times in England to a maximum of 18 weeks from GP surgery to operating table, and you have a system that would already be facing a considerable challenge to deliver.

Yet that is only the first course in this banquet of reform. First, the government is introducing an entirely new system of payment by results, which will have the effect of making every NHS service financially dependent on the number of patients it attracts. Those that fail to generate business will go out of business.

This will be a powerful incentive and, over time, may well deliver more efficient and responsive care, but it will certainly make some services falter. And, given the relatively crude nature of the new tariffs, not all those that struggle will be inefficient. The one thing we can be sure of is a degree of turbulence and disruption.

Not content with this, the government has embarked on the largest civil IT project in the world to underpin all these changes. In public at least, those responsible are upbeat, but a quick look at the government's past performance on phasing in large-scale computer programmes is enough to make the wise cautious.

And now, on top of all this, the Department of Health has announced what amounts to a huge structural reorganisation, throwing the whole service into a frenzy. Already NHS trusts had been told they would all have to acquire foundation status by 2008. Now strategic health authorities have been told they will be slimmed down from 23 to eight or nine by April 2007.

Primary care trusts, the next level down, not only face the prospect of amalgamation by October next year, they must also divest themselves of all the community services they provide and become commissioning-only organisations. At the same time, most of their commissioning will be handed over to groups of GP practices by December 2006.

Although many of these changes make sense, there are obvious contradictions and uncertainties. Encouraging hospitals to do all they can to attract patients, while demanding that there be fewer unnecessary admissions, is just one obvious example.

In short, the whole system is being turned upside down, and the chances of cuts and closures, angry doctors and nurses, and the appearance of a besieged service - at least in parts of the country - must be high.

And what will this all mean for patients? The goals of faster access and greater convenience are becoming a reality, but what will happen to quality of care? There is a case for keeping up the momentum of reform and for achieving as much as possible before the large injections of money dry up in 2008. It is also self-evident that leaving things as they are is not an option if the government wants to be able to demonstrate that the extra money has delivered real gains for patients. But why this amount of change, and at this speed?

The inescapable conclusion is that it is driven by a political timetable: a fear on the part of Blairite radicals that they need to have advanced far enough to make any retreat impossible when the handover of power takes place. They know that Gordon Brown has been wary of some of their reforms - indeed, at times hostile, especially to the idea of bringing in the independent sector as a major NHS provider. So they want to ensure this is a valve the NHS is passing through, not a swing-door.

It would be a terrible irony if, in their anxiety to get things done quickly, they jeopardised their own reforms.

Niall Dickson is chief executive of the King's Fund