Health and Social Care Bill

Earl Howe Excerpts

Monday 19th December 2011 Lords Chamber

[Lord Patel]

My Lords, I have added my name to Amendment 344 tabled by the noble Lord, Lord Warner. NICE should continue to do technology assessments or appraisals. It is not surprising that I should support the amendment, because I was closer to the establishment of NICE than most people may know, although I said so at Second Reading. It was a paper written when I was chairman of the Academy of Medical Royal Colleges, to establish a national institute of clinical effectiveness, which led to the establishment of NICE as an institute of clinical excellence. At the same time as Mike Rawlins, a good friend for many years, started with NICE, I was involved in a similar exercise with SMC, its sister organisation in Scotland.

The key thing about both organisations is that, despite their appraisals of drugs, neither of them has been taken to court about their advice. That says something about the scientific veracity with which examinations are carried out. Although I have views that are sometimes slightly different from NICE—for example, I think that we will have to adjust in due course the QALY from £30,000 a year because we will find with drugs that are more expensive and effective that that price is too low—I go further and say not only that NICE should not be stopped from doing these appraisals but that its remit should be extended to biochemical tests, which should not be used in the NHS unless they are proven to be useful. As genomic medicine advances, more molecular and genetic tests will come on the market. It is already happening in the United States. Tests are used which are not found to be scientifically appropriate and marketed at a ridiculous price. I give the example of a test that is used to predict whether a person with a myocardial infarction will develop chronic heart failure. We use a much simpler test. They charge £8,000 for a test which must be done twice a year; we use a stethoscope to listen to the chest to see whether there are any bubbles in it. If there are not, the person is not in cardiac failure. It is as easy as that and every medical student is taught it. It will become even more important that an organisation that is as respected as NICE is given the task of assessing biochemical, molecular and genetic tests before they are implemented in the NHS, otherwise their cost will be enormous. Every marketing company will come along and say, “This test should be used”, as is happening in the United States. I would therefore extend NICE’s technology appraisal remit beyond drugs. It offers proven, scientifically driven assessments and I cannot see why we should stop them. Besides, we would see one part of the United Kingdom continuing while another part did not. I know that if NICE says a drug produced by a British pharma, particularly a big pharma, is not effective based on QUAL, it might be difficult for that pharma to market the same drug internationally, but that is an issue that needs to be tackled separately. Value-based pricing of drugs may be an area that we need to look at again, but not the appraisals.

[Earl Howe]

My Lords, I know that NICE is held in very high regard by noble Lords in the Committee. The Government share that view. That is why we are putting NICE on a firmer statutory footing in the Bill, extending its role to cover social care as well as healthcare and public health, and putting NICE quality standards at the heart of quality improvement. NICE will continue to play a key role in helping to ensure that decision-making in the NHS is robust and evidence-based.

The noble Lord, Lord Owen, said that the Bill gave the impression that NICE would turn into a kind of annex of the Department of Health. I can assure him that that is not the intention of the Government. A special health authority, as NICE technically is at the moment, is much closer in technical terms to the Department of Health than the non-departmental public body that we will set up. He also said that he felt that the additional responsibilities we were placing on NICE were inappropriate. When I have spoken to Sir Michael Rawlins, the chair of NICE, he does not take that view. He regards what we are doing as a vote of confidence in NICE, which is what it is intended to be.

There has been some confusion throughout the passage of the Bill about the detail of NICE’s future role. This may underlie some of the discussion we have had in the debate around the incorporation of NICE’s technology appraisals into quality standards. First, I can confirm that NICE will continue to appraise new drugs and technologies at least until we implement our plans for value-based pricing from 2014. The Bill enables us to provide for NICE to continue this important work when it is re-established.

As we develop our plans for value-based pricing of new branded medicines, NICE’s role in appraising drugs will inevitably evolve. However, we have been clear that we expect NICE to have a central role in the value-based pricing system, including in undertaking an assessment of the costs and benefits of different medicines. That is highly analogous to its current role. I very much agree with the noble Lord, Lord Owen, that we do not wish to lose—and certainly not downplay—the skills and scientific and analytical expertise that NICE undoubtedly has. We will make announcements on the precise shape of the value-based pricing model in due course but suffice to say for now that we believe that NICE is very well placed to fulfil the role of performing the pharmacoeconomic evaluation that will underpin the value-based pricing assessment.

Alongside that, NICE may also need to continue to undertake some technology appraisal activity after 2014—for example, to review existing recommendations in the light of new evidence or to assess important new non-drug technologies. It is quite wrong to suggest that we will cease that activity within NICE.

I also take the opportunity to reassure noble Lords that we will use powers in the Bill to replicate the effect of the funding direction which ensures that the NHS in England continues to fund drugs that have been recommended by NICE’s technology appraisal guidance. However, it would not be appropriate to place in the Bill such a requirement on clinical commissioning groups—as Amendment 344ZA would seek to do. That would leave no flexibility to alter the requirement in the event that there were clear practical barriers to implementation within three months of the final guidance. Amendments to the existing funding direction have only been made on a small number of occasions but it is important to retain that flexibility and secondary legislation supports this better than putting a requirement in the Bill.

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[Lord Hunt of Kings Heath]

—not the mess, my Lords, but my noble friend’s vigorous discussions—because of the wish to ensure that those global companies continued to invest in the UK. The problem with the Department of Health is that while it sponsors the industry, its real concern, when it comes down to it, will always be the cost of drugs to the National Health Service—hence my concern that powers of direction by the NHS Commissioning Board will not be used in a way that is conducive both to the independence of NICE and to the continued R&D spend on pharmaceuticals in this country. I do not really want to institute a debate on value-based pricing at this point, but I hope that the Government will look very carefully at its introduction and all the consequences from it. Having said that, unless the noble Earl wishes to answer the point on direction, I certainly beg leave to withdraw.

[Earl Howe]

My Lords, I will drop the noble Lord a letter on the funding direction, but it is our intention to place this in secondary legislation, appropriately amended as he indicated. It is possible that this will be incorporated in the standing rules as a fixture. On value-based pricing, I can tell him only that quite detailed work is currently under way on the model and that, while I agree in many ways with his comments on the PPRS, it has two unsatisfactory features. One is that it does not recognise fully the factors that society values; the other is that it does not incentivise research sufficiently to address areas of unmet need. If we can achieve both those things, it will represent an advance, but the noble Lord is right that there is still some way to go before this model is finalised.

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[Lord Hunt of Kings Heath]

My Lords, I follow on from the noble Lord, Lord Owen. Clause 231 says:

“The relevant commissioner may direct NICE to prepare statements of standards in relation to the provision of … NHS services”.

In relation to a quality standard regarding the provision of NHS services, the relevant commissioner means the Commissioning Board.

I come back to the point about independence: surely it should be the Secretary of State who should direct NICE to prepare statements of standards in relation to the provision of NHS services. Surely, under this architecture, the concern of the Commissioning Board will be money. It is going to have to ensure that the NHS delivers what the Secretary of State requires in the mandate, which is growing ever longer as we debate the Bill, and that will mean quite a lot of pressure on it. I am worried that because it can direct NICE to prepare statements of standards, it is bound to be governed by finance; in fact, it is bound to relate the number of standards that it directs to the resource issue.

Of course one has to take account of resources, and the very fact that NICE’s technology appraisals are concerned with cost effectiveness is a recognition that we have to make judgments about the use of resources, but I would have thought that there was benefit in there being a distance between that direct concern of the Commissioning Board and the overriding leadership of the service that the Secretary of State must provide.

I wonder if the Minister would be prepared to give this further consideration. In this part of the Bill and in Clause 236, where the board can give directions to NICE, one simply has anxieties that, at least visibly, the independence of NICE might be compromised.

[Earl Howe]

My Lords, NICE’s independence is the foundation of its reputation as an authoritative source of evidence-based advice. To guarantee that independence, to pick up the point made by the noble Lord, Lord Hunt, the Bill contains no direction-giving power to enable NICE to be directed as to the substance of a quality standard, and explicitly prohibits regulations from enabling the Secretary of State or the NHS Commissioning Board to direct NICE on the substance of its advice, guidance or recommendations. I reassure noble Lords that the independence of NICE’s advice is assured by the very mechanism by which it formulates it—through public consultation and collaboration with respected authorities such as medical royal colleges.

I shall explain in a moment how we propose that the NICE quality standards should be commissioned, because there are different arrangements for different types of quality standard. However, the amendments begin to chip away at what we want to see—that is, a clinically led process—by specifying what really does not need to be specified, as the evidence of the quality standards published to date shows. I appreciate that many people have an interest in this programme, and that is why subsection (7) not only requires NICE to establish a process for its quality standards programme but requires a consultation on that process. That gives ample opportunity to patients, clinicians and other interested parties to have a say in how the programme is delivered.

NICE is expected to develop a broad library of between 150 and 175 quality standards, spanning the domains of the NHS outcomes framework and commissioned by the NHS Commissioning Board. The Secretary of State will have responsibility for commissioning quality standards for social care and public health. For integrated pathways of care covering NHS treatment together with public health and/or social care interventions, the Secretary of State and the Commissioning Board will be able to commission quality standards jointly. So, NICE will prepare quality standards when commissioned to do so by the board for NHS healthcare services, by the Secretary of State for the public health service and social care and jointly by the Secretary of State and the board for integrated pathways.

The noble Lord, Lord Warner, expressed his disappointment at the rate of progress of the rollout of NICE quality standards. Actually, there has been a steady start to this: we have some two dozen quality standards at the moment and, as I mentioned, we will have between 150 and 175 of them over a five-year programme. We agree with the noble Lord that it is crucial to maintain momentum with this important work, and NICE has told us that it believes that the programme is realistic. It is unnecessary to undertake to agree a programme of quality standards each year. The current programme that is being overseen by the National Quality Board is ideally placed to deliver that steady steam of quality standards over the agreed timescales.

The noble Lord, Lord Patel, asked how we will ensure that standards will stand the test of time. NICE regularly reviews its products, including guidelines and standards. This is an established part of NICE’s working procedure that has helped it to attain its high standing with patients, clinicians and, indeed, the industry. NICE is keen to take into account any new evidence and to be responsive to changes in circumstances.

As I said earlier, NICE quality standards bring clarity to quality, providing definitive and authoritative statements of high quality care and based, as the noble Lord, Lord Patel, rightly said, on the evidence of what works best. As we move towards a system that will focus on improving the outcomes that matter most to patients, it is vital that quality standards reflect these.

Amendment 343, which places a particular emphasis on long-term conditions, is understandably motivated but it may have the unintended consequence of excluding other conditions. While I sympathise with the sentiment, it is probably undesirable to specify that in the Bill. That is why the National Quality Board is overseeing the development of a process for selecting topics for the rest of the library that will integrate and build on the current process for selecting the NICE clinical guidelines. This process recognises the importance of ensuring that smaller specialties are taken into consideration. I have a long list here of topics in the proposed programme that address long-term conditions. I am happy to let noble Lords have that. This reflects the fact that these quality standards are needed to help the NHS improve outcomes in this area, as we envisaged in the NHS outcomes framework.

NICE recently completed an engagement exercise on the proposed library of quality standards. The responses were overwhelmingly positive about the programme and the role of quality standards in the new system. This feedback is reassuring, and I hope it reassures the noble Lords sufficiently to enable them not to press their amendments.

[Baroness Emerton]

My Lords, could I just interrupt to ask a question about the evidence-based quality standards? Where do we fit in the culture change that is so important when we look at quality standards? It is very difficult to measure a culture. We talk about trying to integrate health and social care in all the standards in primary, secondary and tertiary care. An evidence base is essential for NICE, but we have not mentioned culture at all today in this context. It is absolutely fundamental, particularly with the long-term conditions, to talk about or to include some measurement of culture.

[Earl Howe]

The noble Baroness is quite right and no legislation can provide for that culture change, as she will appreciate. At the same time, we can put in some important building blocks to encourage a change of culture. One is to have maximum clinical input into how the quality standards are framed and formed and, indeed, input from patient representative groups. It is very important to see things from their perspective. We can create duties, as we have in the Bill.

The work that my department has done on accelerating the uptake of innovation is relevant here. The NICE implementation collaborative—the NIC—that was part of our announcement about the growth agenda some days ago is designed to bring together the relevant stakeholder groups to see how the uptake of innovation can be accelerated and how people can be made to look at working practices in rather a different way so that cultures shift. However, it is easy for me to stand here and say that; it is less easy to drive this forward. I would not pretend that the Government are necessarily in the best place to do that, although we are clear that this shift in approach, which largely underlines the QIPP agenda as well, has to take place. However, it will take a little time.

[Lord Warner]

My Lords, the total purpose of my Amendment 342 was to inject some momentum into the process of delivering these quality standards. I am much reassured by what the noble Earl has said. I think my noble friend’s point about directions for the national Commissioning Board is important. It can be misleading. I hope that the revelations of the noble Lord, Lord Owen, about the chairman of NICE’s past associations will do no damage to his reputation. I beg leave to withdraw the amendment.

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Moved by

[Earl Howe]

344A: Clause 240, page 237, line 23, leave out “its functions” and insert “any function it has under or by virtue of any other provision of this Part”

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[Lord Naseby]

My Lords, the Deputy Speaker called the amendment and it was agreed, but I did not specifically hear that Clause 240 should stand part. If I may, I will intervene briefly on whether the clause should stand part, particularly the additional functions under subsection (1)(a). It states:

“NICE may do any of the following … acquire, produce, manufacture and supply goods”.

I have a query for my noble friend on the Front Bench. We are well aware that in the past some hospitals have manufactured certain generic medicines and marketed them, which has caused the normal market for medicine and pharmaceuticals to be disrupted. Secondly, we are aware, particularly recently, of certain hospitals that have been selling medicines in another market, which has caused disruption to that market and particular difficulties for parts of the country where there has been a shortage of medicines.

I may be wrong but, as I read it, this clause means that NICE will be in a position to manufacture directly, maybe even under a licence. I see that under paragraph (f) NICE will be able to,

“exploit ideas and exploit intellectual property”.

Can we be quite clear? Is my noble friend really saying that NICE, the adjudicator of value for money and all the other dimensions in the Bill to do with pharmaceuticals, medicines et cetera, will manufacture certain medicines on the side? That does not seem to be part of the role of the regulator. It seems, frankly, to be virtually direct labour within the context of NICE. I would be most grateful if my noble friend would respond. If he is not able to respond today, perhaps he will respond on Report or write to me.

[Earl Howe]

My Lords, I hope I can assist my noble friend. Clause 240 enables NICE to undertake additional functions, such as supplying new services and exploiting intellectual property. These functions must be related to the provision of health and social care. They seek to reproduce the income-generation powers that NICE currently enjoys as a special health authority and do not therefore represent an expansion of its powers. NICE may do this for any number or type of organisations, including the private sector and overseas Governments. This clause allows NICE to charge for carrying out these additional functions on an appropriate commercial basis.

In the White Paper Liberating the NHS: Report of the Arm’s-Length Bodies Review, the Government stated that,

“where appropriate, arm’s-length bodies will be expected to exploit commercial opportunities and maximise commercial discipline across the sector”.

NICE may carry out these additional functions provided that they do not have an impact on its ability to carry out its functions. We do not envisage, and nor does NICE, that the performance of any of these functions will interfere with its normal work programme. I hope that that is helpful to my noble friend. It is certainly not the case that NICE will be manufacturing medicines, as I think he feared.

[Lord Hunt of Kings Heath]

Is not the point that NICE enjoys a global reputation for the excellence of its work, as we discussed earlier? I do not know how many hits it has on its website every day but I understand that it is a considerable number. Is this not a huge advantage for the UK and that all the Government are seeking to do is to ensure that NICE can exploit that so that its work in the UK can be developed elsewhere?

[Earl Howe]

The noble Lord is exactly right. He will know from his time as a Minister with responsibility in this area that NICE has steadily grown its reputation overseas, and that with that have come opportunities to sell its services in a number of quarters. We simply want to see that continue.

[Lord Naseby]

I understand that and I understand the point made by the noble Lord, Lord Hunt. Nevertheless, to the best of my knowledge, NICE has never manufactured, and presumably from what my noble friend has said is not going to manufacture, in which case perhaps “manufacture” can be deleted from the Bill when it returns on Report.

[Earl Howe]

I will take advice on why “manufacture” is in the Bill and come back to my noble friend.

Clause 240, as amended, agreed.

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Moved by

[Earl Howe]

344B: Clause 246, page 239, line 16, after “Consultation” insert “with any person”

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Moved by

[Earl Howe]

344C: Schedule 18, page 420, leave out lines 22 to 26