Harnessing competition to strengthen integration


The debate about the use and misuse of competition and integration is at the heart of health policy. Few concepts are as widely used, politically loaded and surrounded by confusion. Both, like beauty, are in the eyes of the beholder, meaning different things to different people. Both are championed as the saviour of healthcare and both are condemned as a threat to the NHS. At the centre of this controversial yet critical debate is the new sector regulator for the NHS, Monitor. First, the Government’s White Paper sought to make Monitor the economic regulator for health and social care, responsible for promoting competition in the interests of patients and taxpayers. Following the NHS Future Forum, Monitor’s duty to promote competition was replaced by a focus on protecting and promoting the interests of patients, enabling integration and preventing anti-competitive behaviour.

Despite the amendments to Health and Social Care Bill there is still great uncertainty over how Monitor will support patient choice and integration in practice. With the Health and Social Care Bill going through the House of Lords, Reform held a lunch with Dr David Bennett, Chair and Interim Chief Executive of Monitor, to explore how competition and integration would be implemented in the new NHS. Reform’s aim was to bring together leading experts from the health service and policy debate to address these issues.

Key themes of the seminar

Integration for patients

No single idea has been so central to the policy debate as integration, yet so poorly defined. David Bennett described Monitor’s duty “to enable integration that could improve the quality or efficiency of provision, or reduce inequalities in access, or reduce inequalities in outcome.” Integration for the benefit of patients is fundamental, and can simply be improving the coordination of services at the patient interface, so the patient feels that the system “knows who they are, remembers who they are, knows and remembers what’s wrong with them.”

As David Worskett reflected, this is “absolutely not the same thing and not wholly dependent on the organisational integration of the people who are providing it.” Providing an integrated service will not be achieved by encouraging collaboration between different providers without changing the incentives in the system to transform behaviours.

Competition to promote integration

While some have argued that competition and choice will always undermine integration, this is not the case. Many of the world’s leading examples of integrated care, such as Kaiser Permanente in the USA and Manises in Valencia, have developed in competitive environments and due to new entrants. In addition, competition is needed to bring integrating organisations into the NHS market that will challenge existing silos of care and coordinate different services around the needs of patients.

According to John Swift QC, the principles of competition and policies to deliver integrated care can coexist. “Even if you take the basic principles of European competition law, you will see that they are broad enough to encompass positive aspects of cooperation as between existing competitors, even potential competitors, so as to produce an end product that would not be feasible were one undertaking to promote it on their own.”

The role of Monitor

Getting the balance right will be essential but there is much more that Monitor can do to enable both integrated care and encourage new providers. Robert Naylor made the case to reform the payment mechanisms in healthcare, moving away from payment by results and towards bundled payment and capitated budgets. Sonia Brown called for a cultural shift among patients and much better information to inform meaningful patient choice.

Stephen Littlechild argued that regulators could usefully play a facilitating role, such that instead of prescribing the minutiae of interaction between companies and their clients, regulatory bodies attempt to create a context in which the two parties can come to productive agreements on their own terms. Lord Warner highlighted Monitor’s role in managing failure and removing the barriers to entry and exit that will allow new entrants to enter the market and integrate care.

The challenges ahead

However, delivering on the potential of the reforms is in danger of being undermined by short term pressures. While commissioners could become real drivers of integration short term, financial needs and the reorganisation of the commissioning landscape will make it harder to innovate. Moreover, the confusion of responsibilities of Monitor and the new Commissioning Board could present problems in the future system. In addition, rather than delivering an integrated services focused on patient needs, the drive to achieve integrated care may lead to an integration of organisations and a preservation of existing monopolies.

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