National Health Service (Licensing and Pricing) (Amendment) Regulations 2015

Lord Patel Excerpts

Tuesday 1st December 2015 Lords Chamber

[Lord Patel (CB)]

My Lords, perhaps I might start by suggesting to the Minister that this is another example of why the NHS might be unsustainable and that we probably need an independent commission to look at the whole of the NHS. I realise that neither he nor the Opposition Front Bench are likely to agree with me on that, but I make the point that this is yet another nail in the coffin, so to speak, which will get us to that end some day.

I find myself in agreement with some of the things that the noble Lord, Lord Hunt, has just said. We have an example here of where raising the tariff to 66% actually means ruling out the ability of the providers to engage in any kind of discussions relating to the tariff because the target is too high. If that is the case and the providers are therefore not able to engage with NHS England and Monitor, which sets the tariffs, what other mechanisms do they have? They cannot see the proposed tariffs until the consultation occurs, which is rather too late for them even to road test whether the tariffs are likely to be workable—particularly if they involve, for instance, any implications on pensions or proposals that the Government may have brought about pay deals, or any other issues that may impact on the cost. So how is the provider likely to get any input at an early stage and engage with the tariff-setting mechanism? There will be no such input, I suggest, through these proposals, which will make it impossible. They will therefore have to live with the tariff.

I realise that the big providers might be able to do that, because they might save some money from other aspects, but let us take the specialist providers. We can particularly imagine this in paediatrics and with some cancers, where providers work on small margins and the costs may escalate. Because of a few patients having highly complex issues, costs can overrun. That is why the top-up fees of some £300 million were introduced, 70% of which go to paediatric specialist services. Now the proposal is to remove those or reduce them considerably. In paediatrics, the top-up might go down from £217 million to £95 million. So these specialist providers have a choice: either to provide poor-quality service, which impacts on the patients, or to opt out. Who will then suffer? It will be not the commissioners, NHS England or Monitor but the patients—because they will not have a service or will have a poor-quality service.

I agree with the noble Lord, Lord Hunt, that there needs to be some kind of mechanism where there is early involvement of the providers, which can engage in the tariff-setting mechanism. They would not necessarily dictate it; they might disagree with it but suggest some proposals. One of the ways, as he suggests, would be a stakeholder forum involving all the parties at an early stage. The Department of Health can then have some accountability from all the people in the stakeholder forum, including the providers. I am attracted to that suggestion, and I hope the Minister will respond to it.

The Minister responding in the other place sounded sympathetic—or at least suggested that he understood the issues. I hope that we can go further today and that the Minister will say that it sounds attractive and that he might look at it.