Select Committee on Health Minutes of Evidence

Examination of Witnesses (Questions 140 - 159)



Dr Taylor

  140. You have said that the national service frameworks are big drivers in increasing the spending in that particular subject. What do I say to consultants in non-NSF specialties who feel very hard done by because they have not got the push behind their funding? How do I answer them?

  (Mr McKeon) You answer by saying the Government has made some choices in terms of priorities in terms of the NSFs which now cover CHD, cancer, older people, mental health, and coming along are renal disease, children and longer-term conditions.

  141. So other ones —
  (Mr McKeon)—other ones are in train. The next three are going to be renal disease, children and longer-term conditions and diabetes, I forgot to mention that, so there is a pretty wide coverage.

  142. One more question about NICE. During the NICE inquiry I think it was Lord Hunt who told us categorically that health authorities had been given enough money to fund the NICE recommendations. Were they given the £225 million in the last year? Are they going to be given the £467 million? Are they going to be given enough to fund these changes?
  (Mr McKeon) We are satisfied that over the period of the SR round that we factored in sufficient to cover the cost of the NICE recommendations. It clearly has to be a bit of a guess because we do not know exactly what the recommendations are going to be, but we have factored in enough for that estimate and indeed for other pressures on prescribing and so on.

  143. Do they have a chance to come back to you and say they do not agree?
  (Mr McKeon) They always have a chance to come back to us, and they frequently do.

Mr Burns

  144. And say they do not agree?

  (Mr McKeon) It is very rare in my experience in the Health Service for people to say to us, "Yes, you have given us all the money we need."

  145. So in fact the answer to the question is no because almost certainly NICE will come back most of the time and say they have not got enough and you will say for a variety of reasons they have and possibly the funding will not be to the level that NICE thinks it should be.
  (Mr McKeon) No, so far on the basis of NICE recommendations we think our estimates have actually been reasonable in the light of their recommendations.

  146. That is what you think?
  (Mr McKeon) That is on the basis of what they have told us they are estimating.

  Mr Burns: Have they come back to you?

  Chairman: Mr McKeon, you are saved by the bell. We will adjourn for ten minutes for a division.

  The Committee suspended from 5.54 pm to 6.05 pm for a division in the House.

  Chairman: Can we recommence. I think, Doug, we were over to you for a question.

Dr Naysmith

  147. We were talking about increases in expenditure not necessarily being parallelled completely by increases in activity. That could lead us to conclusions from Table 2.2.5 that the productivity of hospital and community health services has fallen overall since 1996/97. Is that a fair conclusion to draw from those figures?

  (Mr Douglas) I do not think it is a fair conclusion to be drawn from the figures. It is what the cost weighted activity index will tell you. I think most people would accept that this index is becoming an increasingly flawed way of trying to measure what is really happening with NHS efficiency. When the Chairman discussed with Margaret earlier on some of the issues about not counting activity, increasingly as we shift out of traditional settings we are going to miss a large amount of the activity within that index. As Andy discussed as well when we were talking about NICE and the national service frameworks, we have made an increasing investment in quality that is not picked up in any of these activity figures. What we have really got to do is fundamentally look again at how we measure NHS productivity so we have work in hand on that now.

  148. What is the effect on efficiency targets that are set every year for the NHS trusts? What, if any, effect has that had and is it using an inadequate tool to beat some trusts with?
  (Mr Douglas) For the next round of allocations during the spending review we had long discussions with Treasury about this whole approach to efficiency measurement. We have reached an agreement with them that whilst we will retain within the settlement a two per cent efficiency target each year, that will be broken down in two ways. Firstly, we will have to demonstrate quality of improvement, not just unit cost improvement. Basically we have split the two per cent between one per cent quality and one per cent unit cost, but within the unit costs come up with a more sophisticated measure that takes into account the spending quality areas and takes into account the shifts in settings of care as well, so we will have a more sensitive measure for next year.

  149. How does this map up with the targets set up under the National Health Service Plan?
  (Mr Douglas) Which targets?

  150. The efficiency targets.
  (Mr Douglas) We will still have a two per cent annual efficiency target but it will be measured in a more appropriate way.

  151. When do we get to hear about these methodological changes?
  (Mr Douglas) The measures we have proposed with the Treasury are out for peer review with academics and HS managers at the moment so I would have to check with my colleagues, but we have got to be in a position to tell the NHS at the same time as they are planning, which has got to be by November/December this year.

  152. So quality is going to be an important factor?
  (Mr Douglas) We will take into account quality. There is a very, very clear agreement with the Treasury that there is a one per cent quality element and a one per cent cost efficiency element we can measure.

  153. Can you give examples of what that will mean?
  (Mr Douglas) Part of that is to try to link the input far more clearly to the outcomes. What we tend to do at the moment is try and link the inputs we have got to the activity levels. What we have got to look at is what are the outcomes as a result of that rather than just the activity levels, so that is the way we will try and do it.

  154. Is there any kind of example you could give to me of what we are talking about, what sort of quality?
  (Mr Douglas) I have not got the details with me here, I am afraid, but I could come back with some of the examples linked to that of the ones that are proposed at the moment.

  155. I interrupted.
  (Mr Douglas) I have forgotten what I was trying to say.

  156. I will give you time to think about your answer by asking another question. This issue of qualitative care you talked about, obviously the Department has on the issue of fallen productivity frequently pointed to the measurement of the increase of quality of care. One of the issues we pick up in the survey response is that two of the major indicators of quality, waiting times and readmission rates, have not improved in recent years. What concrete evidence do we have that these quality improvements are taking place? You say it is going to be measured. I am not clear. Looking at the figures we have the measurements so far indicate what you are saying is happening, it may well be happening, is indeed happening?
  (Mr Douglas) This is one of the problems we have. The weighted figures are improving, they are one of our quality measures. What we have to do is to break down some of the National Service Frameworks and say what we are looking at from National Service Frameworks and they measure more precisely the impact of those and the amount of investment that has gone into them. Frankly we have not done that up until now.

  157. It will reach areas of National Service Framework breakdown into evaluating those requirements at a local level presumably?
  (Mr Douglas) Whether we break it down into every element of the NSF we have to work through the appropriate methodology at a national and local level. In most of these areas there is already local measurement and what we are not doing is bringing those together in our aggregate measures in any way.
  (Mr McKeon) I can comment on the readmission rates. I am not sure you can tell too much from the figures presented from the reasons given in the answer to your written question, I think there are two or three reasons for that. Firstly, because these are clinical indicators we need to look at the confidence intervals that are there, which information has been provided, and once you have done that there is possibly a small increase into the readmission rate. That could also be accounted for by improving quality of data. If you are picking up more episodes and making better linkage between those episodes it is clear that readmission rates are likely to be rising purely as an artefact of the data, so there have not been significant changes in readmission rates. If you look at other figures, such as 30 days after surgery, there has been an improvement. That is probably equally a case for caution in terms of analysing the figures. There are some improvements that we could chart, particularly going back to prescribing—I do not know whether the Committee is familiar with the work of John Alton's collaborative on primary care, but that shows quite clearly in the PCTs, which have been with his collaborative, there has been a fourfold decrease in the death rate from heart disease compared with those who are not in the collaborative. That is largely because of the prescribing that has gone on, improvements in prescribing statin betablockers, and so on. There is a very definite improvement in quality. I do not think one measure is good enough. There are a number of steps we are taking to do that, through the planning framework, and so on, and through the introduction of systematic audit and CHD in cancer care, which is a specific requirement over the next three years, which should give data on outcomes and on clinical quality.

  158. If we look at average total waiting times what would that be in terms of trends? I am conscious neither the current government or the previous government measured the total waiting times for initial referral to specialists to the point of treatment. If we look over a period of time what would the trend show in relation to whether it is improving or not? I am advised it has more or less unchanged during the period of the current government.
  (Mr McKeon) We do not measure it.

  159. Why do we not measure it?
  (Mr McKeon) We have never had the ability or the data to do that. It is something we ought to move towards in measuring from the point of time of referral to the completion of the procedural operation.

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