Select Committee on Health Minutes of Evidence

Memorandum by Mr Christopher Newdick (NC 64)

  1.  I am the Reader in Health Law at the University of Reading with an interest in the legal framework surrounding the NHS, its patients, doctors and other staff. I also serve on Berkshire Health Authority's Priorities Committee. The Committee balances the statutory requirement of health authorities to remain within their annual budgets with the duty to serve the best interests of patients in the local community.

  2.  My concern relates the authority and credibility of NICE. There has been a failure to clarify the principles by which it should perform its duties and how it interacts with PCTs and GPs in the resource allocation process. Confusion about its authority and purpose creates greater uncertainty amongst doctors, patients and managers as to their rights and duties in the NHS. Therefore, I encourage the Committee to seek to clarify the following:

    (a)  the authority of NICE guidance,

    (b)  the principles that underlie NICE guidance,

    (c)  the relationship between NICE and PCTs, and

    (d)  the affect of NICE on the GP's Terms of Service.


  3.  What is the duty of PCTs to implement NICE guidance? Before 2002, the guidance was not binding on Health authorities and PCTs. Of course, they had a duty to consider it carefully and not to depart from it other than for good reasons, but it was persuasive only. However, from 1 January 2002, NICE guidance has the status of directions which are mandatory. But exactly what do they mandate?

  4.  Before the Directions were published, it was understood that PCTs would be duty-bound to implement all NICE guidance. The press release which announced the policy said heath authorities and PCTs would be expected to manage their budgets "so that patients can be guaranteed that if a treatment recommended by NICE is.  . . the appropriate treatment for them, they will receive it"[2]. But the wording of the Direction itself is much less clear. The Direction says:

    A Health Authority shall. . . apply such amounts paid to it. . . as may be required so as to ensure that a [treatment] recommended by the Institute. . . . is normally available. . .[3]

  5.  What does this mean? A "guarantee" of access to care would direct that treatment recommended by NICE is always available. Why use the phrase "normally available"? Crucially, in what abnormal circumstances can PCTs decide not to implement NICE guidance? Would scarce resources be a good reason? If so, how different is the duty of PCTs now by comparison to the position before 2002?

  6.  Many new PCTs will commence work in circumstances of uncertainty as to their rights and responsibilities. They need to understand when PCTs can respond to the needs of local communities according to their own discretion (consistent with the policy in Shifting the Balance) and when, by contrast, they are obliged to adhere to the directions of the Secretary of State. This is especially important in respect of their duty to implement NICE. PCTs are entitled to clearer guidance. Their obligations should not be left in doubt.


  7.  NICE's approach to decision-making should be transparent. This is part of the principle of NHS governance and necessary to reassure patients that it is acting fairly and consistently between different cases. NICE should do more to explain how it translates technical appraisals into guidance and articulate the values it uses as a framework for its decision-making.[4] Although its procedures are improving, the substantive component of its decision-making process is obscure.

  8.  First, are QALY estimates relevant? It appears to use a QALY threshold of around £30,000 as a cut-off point for approval[5] (the estimates are notoriously difficult to calculate). If QALYs are significant (even if only as a guideline), NICE should say so.

  9.  Secondly, where possible, clear cost-effectiveness comparisons should also be made with other treatments offering equivalent but less expensive care. NICE has not always done this.[6]

  10.  Thirdly, especially when the cost of its recommendation is high, proper thought must be given to the question of disinvestment. If this function is beyond NICE's competence, the task should be undertaken by another body. It is unacceptable for new targets to be imposed by NICE, the Commission for Health Improvement, National Service Frameworks and the Department of Health without thinking about their cumulative impact on a fixed PCT budget. Disinvestment follows inexorably from redirecting money within a fixed income. Bear in mind that NICE is not concerned with many "non-technological" aspects of care, for example the number of nurses available in hospitals and the community. These services may become the most likely target for disinvestment unless a more sensitive approach is taken to local discretion.

  11.  Fourthly, it follows that the Secretary of State should reconsider the policy of issuing "blanket" directions for all NICE guidance. Its recommendations should be graded in terms of priority, for example, "high" (must do), "medium" (strongly recommended), or "low" (desirable, but subject to other local priorities).[7] For example, NICE has recommended an expensive treatment for reducing the symptoms of influenza by one day. Should this guidance command the same access to resources as effective cancer treatment that will save lives? A rule that obliges PCTs to fund the former, to the total disregard of other demands upon its budget is not credible. It creates the impression of a government entirely insensitive to the need to balance competing demands within fixed budgets.

  12.  A basic question to start with is: should NICE ration medicines that are needed on grounds of cost? NICE's statutory powers do not provide a clear answer to this question. Regulations require NICE to promote "clinical excellence and. . . the effective use of available resources in the health service" as the Secretary of State may direct.[8] The Health Committee has asked the Secretary of State whether he thought NICE could ration NHS treatment. He responded:

    There are two quite separate distinctions which is about assessing clinical and cost effectiveness and a quite separate set of decisions which are around affordability issues. In the end you would want. . . affordability decisions to be located with an accountable politician who has to answer to the House of Commons and to Parliament. It just so happens that accountable politician is me.[9]

  With respect, the distinction between "clinical and cost-effectiveness" and "affordability issues" is not clear. (For example, how does the distinction apply to the drug beta interferon?) In any case, despite the boldness of the rhetoric, accountable politicians almost never engage in "affordability decisions". This is entirely unhelpful as a means of explaining how NICE works.

  13.  Unlike PCTs, NICE is not duty bound both to remain within a fixed budget and serve the diverse health needs of a population of patients. It will lose credibility if it becomes detached from the real funding constraints faced by local health economies.[10] One mechanism for highlighting the reality of commissioning care at PCT level would be to allocate a notional drugs budget to NICE. The Institute would be expected to discuss and explain how it manages the tension between demand and supply. Such an example of transparent decision-making would be of great benefit in demonstrating how it is accountable for its decisions within a consistent framework of values and policies.


  14.  There is another reason why NICE should be transparent about its decision-making. As we have seen, PCTs will be under greater pressure to accommodate the cost of NICE guidance. The cumulative cost of NICE directions over time will be considerable. They will absorb increasing proportions of fixed financial allocations.[11] This is important for treatments not considered by NICE, the number and cost of which will also increase. Inevitably, NICE will impinge on the resources available to fund treatments which are not subject to its guidance and over which PCTs retain discretion.[12] Inevitably, PCTs will have to develop fair and consistent frameworks for dealing with claims of this nature. In effect, each PCT will need a mini-NICE of its own at local level.

  15.  At present, different authorities perform this task in very different ways. The process requires significant resource commitments, massive duplications of effort and is likely to create inconsistency between different "post-codes". The government's intention is to reduce these differences in access to treatment. Yet, at the same time it has increased the number of commissioning authorities from around 100 health authorities, to over 300 PCTs. NICE creates a danger that, with respect to the many treatments which are not subject to its guidance, the strains imposed on smaller residual budgets will cause even greater disparity and confusion between PCTs; and further disillusionment of patients.

  16.  It is absurd that with the expertise and experience of NICE, over 300 PCTs should have to develop their own "priorities" policies without any guidance from the centre, often addressing questions identical to those that have already been considered by PCTs elsewhere. Rather, PCTs should be offered a national framework of values. NICE is the obvious body to perform this function. It should promote its principles as a model on which PCTs should base decisions of their own. Of course, the application of such a model by different PCTs would often lead to different conclusions. But the process and values would be similar. The Secretary of State should direct NICE to develop such a framework within which PCTs should consider new drugs and treatments which are not subject to NICE guidance.

  17.  This is important for another reason. Expectations of the NHS have been raised and patients (and their pressure groups) are prepared to challenge adverse decisions in judicial review. A number of successful cases have insisted on fair, consistent and transparent priorities policies.[13] Clearly, this requirement would be assisted by a consistent "NHS approach" to the issue. Of course, generic guidance of this nature would be flexible and imprecise. This is inevitable in the absence of a generally accepted and practicable definition of health "need". Such a framework of values would leave considerable margin for discretion. Nevertheless, it would provide greater reassurance to patients and PCTs that decisions had been made fairly and responsibly.


  18.  How does NICE guidance apply to GPs?[14] NICE does not force doctors to use treatment they consider inappropriate because "even the best clinical guideline is unlikely to be able to accommodate more than around 80 per cent of patients for whom it has been developed."[15] But the question arises in the other direction. Can doctors prescribe treatment which has NICE disapproval? Of course, such differences of opinion will not be common. But cases will arise in which a patient can show, or the doctor believes, that such a treatment should be used.

  19.  This is important because PCTs will be tempted to penalise GPs who prescribe treatment which has NICE disapproval. This is most difficult when NICE disapproves a treatment on cost-effectiveness reasons rather than for its clinical effectiveness (the drug beta interferon may be an example). Unless the position is made clear, PCTs may threaten GPs with penalties for adhering to their Hippocratic commitment to their patient's best interests.

  20.  The only case to have tested the law on the GP's duty to prescribe concerned the drug "Viagra". The case suggests that any interference with the GP's responsible clinical discretion would be unlawful by reason of the statutory duties imposed by the GP's Terms of Service. Recall that in R v Secretary of State, ex p Pfizer, the Secretary of State told GPs not to prescribe "Viagra" pending the inclusion of the drug on the statutory "grey list" of drugs (which may be prescribed in limited circumstances only). The restriction was challenged by way of judicial review and held to be unlawful. The court held that the Terms of Service imposed on GPs a duty to prescribe based on the reasonable exercise of professional judgment:

    The doctor must give such treatment as he, exercising the professional judgment to be expected from an average GP considers necessary and appropriate. . . . If a GP decides that a particular treatment is necessary, it must inevitably be appropriate. . . [16]

  The guidance in question trespassed upon the proper statutory responsibilities imposed on GPs by the GMS regulations. The Secretary of State is entitled to advise doctors to be cautious in using drugs, "but [he] must make it clear that the GP's clinical judgment is supreme." This suggests that an unfavourable review of a treatment from NICE cannot place a blanket ban on its use by GPs.

  21.  The NHSE appears to have taken exactly the same view. While encouraging GPs to live within budgetary constraints, it says:

    The new system will continue to allow individual GPs to decide what is best for the patient, whether for example, to prescribe drugs or refer patients to hospital on the basis of their clinical judgement. The freedom to refer and prescribe remains unchanged. Patients will continue to be guaranteed the drugs, investigations and treatments they need. There will be no question of anyone being denied the drugs they need because the GP or Primary Care Group have run out of cash. GPs' participation in a primary care group will not affect their ability to fulfil their terms of service obligation always to prescribe and refer in the best interest of their patients.[17]

  22.  The Terms of Service emphasise the GP's duty to individual patients. This makes it difficult for GPs to engage themselves in issues of "cost-effectiveness" and "affordability". There is a serious danger of conflict between the GP's duty to his, or her patients and PCTs duties to remain within their annual budgets. NICE should remove any confusion by clarifying how it considers the Terms of Service may inhibit the take up of NICE guidance in primary care. This is essential for the relationship between GPs and PCTs.

  23.  The Terms of Service are presently being reformed and new regulations are expected by April 2002. This potential for conflict should be clearly addressed in the new terms of service.


  24.  Learning from Bristol[18] highlights how governments make promises on behalf of the NHS which are impossible to achieve within current funding constrains, and to leave NHS staff to take the blame for disappointed expectations. It remarked

    Governments of the day have made claims for the NHS which were not capable of being met on the resources available. The public has been led to believe that the NHS could meet their legitimate needs, whereas it is patently clear that it could not. Healthcare professionals, doctors, nurses, managers, and others, have been caught between the growing disillusion of the public on the one hand and the tendency of governments to point to them as scapegoats for a failing service on the other. . . The NHS was represented as a comprehensive service which met all the needs of the public. Patently it did not do so. . . [19]

  Indeed, even allowing for the additional funding promised to the Service, it urges caution as to the expectations we can realistically have of the NHS:

    The currently announced injection of funding will do much to enable the NHS to catch up: to train and recruit the needed healthcare professionals; to refurbish the hospitals and clinics; to obtain the necessary equipment; to reconfigure the service. But it will not be enough to do more than this. It will not. . . allow the NHS to develop in the way contemplated by the NHS Plan.[20]

  25.  In these circumstances, health authorities have been left to muddle through with inconsistent and piecemeal policies—and to stretch scarce resources to breaking point. The challenge for NICE is to detach itself from the politics of the NHS. Learning from Bristol recommends that NICE should be given greater autonomy and independence from government.[21] This is welcome, but any such independence must depend on greater candour as to the limitations inherent in the NHS and the values by which cost-effectiveness and affordability decisions should be made. Otherwise NICE becomes unreviewable and unaccountable, and cynics will say it is no more than a device for deflecting attention away from government—for "shifting the blame".

  26.  Patients probably accept that the NHS has to make difficult decisions around "opportunity costs". If so, limited rationing based on clear, compassionate and consistent values may also be acceptable. This must be a central objective of NICE, both for itself, and for the benefit of PCTs in general. With enhanced transparency, at arm's length from government, NICE has the capacity to give patients well informed and realistic expectations of the treatments they can expect from NHS.

January 2002

2   Press release 2001/599, New Statutory Obligations for NHS to fund treatments recommended by NICE. Back

3   Directions made 11 December 2001. Back

4   Z Kmietowicz, "Reform of NICE needed to boost its credibility", (2001) 323 BMJ 1324. Back

5   J Raftery, "NICE: faster access to modern treatments? Analysis of guidance on health technologies" (2001) 323 BMJ 1300. Back

6   See P Elton, "NICE should make cost-effective comparisons" (BMJ electronic letters, 3 May 2001). Back

7   See R Cookson, D McDaid and A Maynard, "Wrong SIGN, NICE mess: is national guidance distorting allocation of resources?", (2001) 323 BMJ 743. Back

8   National Institute for Clinical Excellence (Establishment and Constitution) Order, S.I. 1999 No 220, as amended by S.I. 1999 No 2219. Back

9   Mr Alan Milburn, Secretary of State. Evidence to HC Health Ctte, 8 November 2000, para 336. Back

10   See N Freemantle, N Barbour et al, "The use of statins: a case of misleading priorities? (1997) 315 BMJ 826. Back

11   Section 97, National Health Service Act 1977. Back

12   M Sculpher and M Drummond, "Effectiveness, efficiency and NICE", (2001) 322 BMJ 943 and S Ahmed and J Appleby, "Is NICE guidance affordable?" (BMJ electronic letters, 11 December 2001). Back

13   See eg R v North Derbyshire HA, ex p Fisher [1997] 8 Medical Law Reports 327 and R v North West Lancashire HA, ex p A,D & G (2000) 53 Buterworths Medico-Legal Reports 148. Back

14   At present, NICE approvals have concerned medicines available in secondary care. However, over time, those treatments will become familiar to GPs. Also, as the number of approvals increase, more will affect GPs. Back

15   Response to the Report of the Bristol Royal Infirmary Inquiry (NICE, 2001) p 8. Back

16   R v Secretary of State for Health, ex p Pfizer [1999] Lloyd's Reports Medical 289, 295. Back

17   HSC 1998/139, paras 52-53. Back

18   Cm 5207, 2001. Back

19   At p 57. Back

20   Ibid. Back

21   Above, at 315, para 36. Back

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