Health and Social Care Bill

Lord Patel Excerpts

Tuesday 13th December 2011 Lords Chamber

[Lord Walton of Detchant]

My Lords, I shall be brief in speaking to these amendments. I wholly agree with the principle outlined by the noble Lord, Lord Warner. There are many circumstances in which competition, properly controlled, will benefit the National Health Service and will benefit our community. But, like the noble Baroness, Lady Williams, I too, having worked in the United States, would be deeply concerned if competition were allowed to run riot. Years ago, I saw the affect of this. For instance, in the Massachusetts General Hospital, where I worked many years ago, the president of the hospital told me that they were required to debate and negotiate with no fewer than 47 different insurance companies in order to obtain coverage for the patients whom they treated.

Yet in the United States you still find, in certain communities, perfectly acceptable patterns of community care which are in many ways excellent, not least the Kaiser Permanente plan in California. I also visited an excellent clinic and associated hospital providing a substantial range of primary, secondary and tertiary care to a very wide community in Marshfield, Wisconsin. The Marshfield clinic serves a very large community in that state. All the people in the community pay an annual subscription in return for which they get a full range of primary, secondary and tertiary care of a very high standard. There are islands of excellence.

So far as competition in this country is concerned, I have always believed that the cap imposed upon foundation trusts in relation to private patients was unfair. It was imposed at a particular moment in time and based upon income derived by those individual trusts in a preceding period, and was grossly uneven. I have always favoured a partnership between the public and private sectors. In such hospitals and foundation trusts I believe there is a great advantage to allowing them to have more income from private patient beds: it not only generates income for the National Health Service, it also persuades many consultants to become geographically whole-time, looking after their public and private patients in the same hospital and not having to spend time, as many have in the past, travelling to private hospitals.

I believe in competition and in the public-private mix. But in pursuing that type of programme, it is absolutely crucial that Monitor has the authority to prevent any foundation trust from overstepping the mark and increasing its private provision to the extent that it will harm the services that it gives to NHS patients. I would love to have an assurance from the Minister that Monitor will be able to fulfil the function of controlling excesses which could damage the National Health Service if private provision went too far.

[Lord Patel]

My Lords, briefly, we are getting a bit confused between the amendment of the noble Lord, Lord Warner, which I support and is about anti-competitive behaviour, and people talking against competition. The amendment is quite clear. It asks Monitor, within a year, to identify barriers to quality care that are anti-competitive. The noble Baroness, Lady Murphy, gave one example and there are others, such as optometry services, which can, if given the opportunity to expand, not only provide good diagnostic services but also treat some minor ailments that do not need referral to hospital. Our amendment is about anti-competitive behaviour. It is not about competition.

[Earl Howe]

My Lords, there are some extremely helpful amendments in this group. Indeed, there has been a great deal of valuable debate both inside and outside the Chamber on the roles of competition and integration in the health service. I am grateful for much of what the noble Lord, Lord Warner, said in his introductory speech.

The Government have been clear that both competition and integration can be important tools for commissioners to drive up the quality of services for patients. We have also been clear that it will be for commissioners to decide where and how these tools should be used—not Monitor. There will be no “one size fits all” or a model prescribed by government.

To help ensure that both competition and integration are effective, Part 3 of the Bill seeks to establish appropriate powers for Monitor. Where there is competition, Monitor will have powers to ensure that it operates effectively in the interests of patients and to safeguard against anti-competitive conduct that can work against those interests. The Future Forum concluded that Monitor, as a sector-specific regulator with knowledge and expertise in health services, would be best placed to achieve this. Let me remind the Committee that this is if there is competition. In some circumstances, I freely concede that commissioners may decide that the best way to achieve high-quality services for patients is not to have competition.

On Amendment 265C, I hope that noble Lords will agree that it is the right approach to require Monitor’s focus to be on considering the interests of patients. That will allow Monitor the scope to take account of a broad range of factors. This approach also provides continuity with the requirements of the existing system rules, the Principles and Rules for Co-operation and Competition, which we have committed to retaining and giving a firmer statutory underpinning through Monitor’s sectoral powers. Those powers are the setting and enforcement of licence conditions for providers and the overseeing of commissioning regulations set by the Secretary of State. Along with the concurrent powers to apply the Competition Act with the Office of Fair Trading, they will provide necessary safeguards to ensure that the interests of patients are protected.

To pick up on the sorts of circumstances cited by the noble Lord, Lord Whitty, that would include, for example, safeguarding against providers exchanging information to agree lower levels of service quality than they would otherwise supply if they were in competition; or a commissioner removing a well performing provider from the choices available to patients, or seeking to direct patient referrals to one provider and not another on non-clinical grounds.

However, it is not the case that every arrangement in the provision of healthcare that had the effect of restricting competition would necessarily be anti-competitive. I made that point in one of our earlier debates. I look particularly in the direction of the noble Lord, Lord Whitty, in saying that Monitor’s core duty means that patients’ interests will always come first. For example, in some cases limiting competition by concentrating specialist services in regional centres or in providing services through a clinical network may deliver overriding benefits to patients and would not, therefore, be anti-competitive. Similarly, where an integrated service raises competition concerns, and equally where services offering more choice and control raise concerns over integration, Monitor will always come back to its core duty—to ask itself the question, “What is it that benefits patients the most?”.