Efficiency, profits and perverse incentives.

Imagine you’re a gastroenterologist working in a large PFI hospital with a multi-million pound PFI debt. Your hospital is a foundation trust and therefore contractually obliged to make  a profit. You’re aware (albeit dimly) that somewhere in the health white paper it says that if your hospital can’t turnover an operational profit you’ll be either closed down or more likely taken over, perhaps by Sainsbury’s.

Your managers are leaning on you (and every other department) to work more efficiently in order to raise cash for the hospital. Last month (for the 10th month in a row) the general surgeons won the prize for income generation thanks to their busy gastric band and bypass service.

Your next patient comes with a short letter of referral from their GP saying that their acid reflux wasn’t settling after treatment with 2 different acid suppressants and testing for helicobacter was negative. Could you give some advice and perhaps perform an endoscopy?

Most GP’s who want an endoscopy refer direct to the nurse specialist. She is making plenty of cash, no time wasted listening to the patient’s story, just a busy production line with a patient in and out every 35 minutes, a generous tarif for every scope and next to no complications. Easy. Running a general outpatient clinic is different however. Up to 60% of patients in hospital outpatients have medically unexplained symptoms (MUS). What about them?

This patient seems more straightforward however. Not so long ago, faced with a patient with heartburn, you would have taken a history, examined the patient, repeated some blood tests, done an endoscopy and referred back to the GP with advice about future management. Now, forced to fill the yawning hole of debt and catch up with your more ‘efficient’ colleagues you’ve had to completely change your practice. Every test you arrange, every procedure you carry out, every colleague you refer this patient to for another opinion generates money for your hospital. The GP gets the bill. (Actually presently the PCT gets the bill and then shows the GP how much money they’ve spent. If the white paper goes through, the GP will be billed directly.)

Acid reflux is frequently difficult to treat and fails to respond to the usual medications which is why you still get a few referrals. Heartburn can cause chest pain so you could ask for a cardiology opinion. In some cases reflux can cause a chronic cough  so you could ask your respiratory colleagues if they’d be so kind as to arrange some tests for asthma. Reflux can cause a sore throat, so you could refer to your ENT colleagues to check his pharynx and perhaps arrange a scan of his neck. You could arrange an ultrasound of the patients abdomen and perhaps if they have gallstones you could as for the surgeons to consider removing them.

Remember, every test, every procedure and every referral gets billed to the GP and the hospital gets the cash.

You swallow down some of the professional pride that’s protesting and fill in forms for blood tests, endoscopy, ultrasound, ECG and opinions from your ENT, Cardiology and Respiratory specialist colleagues, each of whom is also under pressure to perform as profitably as possibly. Each of them will be forced to think about the patient in terms of how much income they can generate for the hospital.

You don’t believe it’s got anything to do with efficiency any more. Its obvious to anyone that if you’re efficient you’ll do less and earn less. There are patients who’ve seen every specialist and are still being passed around having more and more money extracted from them. These are the ones at the more severe end of the medically unexplained symptom spectrum, doctors used to call them heartsinks, now the managers call them ‘cash cows’ because no matter how much work you do on them, you can still do more. People with medically unexplained abdominal symptoms are 3 times more likely to have their gallbladder removed, twice as likely to have their appendix or uterus removed and 50% more likely to have back surgery compared to a matched control group. They are also significantly more likely to commit suicide after surgery.

There is a growing body of research on how best to manage patients with medically unexplained symptoms. For the last few months I’ve been involved with psychotherapists and psychiatrists at the Tavistock to see how better to look after these unfortunate people. For years they’ve been treated as heartsinks, timewasters and nutcases. What is beyond doubt is that people with MUS are really suffering and they are harmed by excessive medical interventions and helped by an enduring supportive relationship with a clinician. And thanks to work with the Tavisock and others the awareness of MUS and how better to identify patients and care for them the situation might improve. However …

Both the incidence of MUS and the associated harm is higher in healthcare systems with ‘perverse incentives’ (financial drivers of clinical activity) like the US. The health white paper marks a decisive and deliberate change towards a system of perverse incentives, in which profitability is the bottom line and the possibility of continuity of care is being destroyed by the twin tyrannies of patient choice and multiple providers.

Sir David Nicholson came to Hackney last week, after his infamous, ‘if you don’t like it get out now’ speech. He was presented with a case very similar to that outlined above and was speechless. It hadn’t occured to him that this was the kind of disaster awaiting us if the commercialisation of our NHS goes ahead.

We have to hope we’ve made an impression.

Please spread the word. This white paper will destroy the NHS.

4 responses to “Efficiency, profits and perverse incentives.

  1. This is very interesting, thanks. The problem is that I (like many people) have grown up in the NHS with the assumption that the tests and procedures were solely for my benefit. The new world of Lansley’s NHS will be a jolt to all of us. But the question is, how long will it be before we realise that the system has turned rotten?

  2. Pingback: Commissioning and the purchaser-provider split | Abetternhs's Blog

  3. Well, it’s hard to find the right balance, but on the whole, as a patient, I would be happier if the doctor’s incentive is to provide more care than I need rather than (as at present) to provide less.

  4. The NHS with all its flaws is still the flagship for social healthcare throughout the world. This iniquitous bill is quite simple a portal to privatisation and the story above, whilst making chilling reading, does not surprise me in the least. We must do everything in our power to stop it in its entirety!

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