Editor's blog Tuesday 6 July 2010: Dorrell 4 vouchers! 2020 4 co-payment! And (to boost search rankings) K&C PCT 4 porn!

Health policy is fun.

No, honestly, sit down and watch. You get to see the whole gamut of emotions, religions and vices pass by you.

Guardian social affairs editor Randeep Ramesh (at whom I wrongly had a go on this blog ages back - sorry, Randeep) was at the launch of the latest report from the Commission On 2020 Public Services At The RSA, where Commons health select committee chair and ex-Health Secretary Stephen Dorrell hymned the praises of vouchers in the NHS.

Another great thing about health policy is its environmental-friendliness. Just stand here for long enough and you'll see it all recycled.

This voucher concept is a return from the policy grave for Dr Liam Fox's wildly popular 'patients' passport' pledge to give people half the cost of an NHS operation to go private (which helped the Tories lose a third general election on the bounce in 2005, in the aftermath of the popular and successful Iraq war).

Ramesh also reports that Dorrell concurs with Nadine Dorries that the Coalition policy of protecting the NHS budget is wrong.

The co-payment concept is also floated in the Commission On 2020 Public Services' otherwise generally high-quality report, 'Improving Health Outcomes - A Guide For Action'.

The Commission's previous reports have recommended:
• "A shift in culture: from social security to social productivity
• A shift in power: from the centre to citizens
• A Shift in finance: : reconnecting finance with the purposes of public services"

That all sounds good. Unfortunately, authors and Commission members Dr Greg Parston (director of the Accenture Institute for Health and Public Service Value) and Dr Henry Kippin (fellow of the University of Sheffield) also write "the debate on funding long-term care has brought the idea of partnership funding into the political mainstream. This could be extended to explore co-payment options across health and social care.”

Ulp. The first point here is that long-term and social care have been means-tested and co-payed for by the relatively wealthy for three decades now. It's been a pretty mainstream issue for some time. The Richards review also bowed to public pressure in allowing NHS patients to "top-up" their treatment with expensive, non-NICE-approved drugs (and also told PCTs to pay more generously for end-of-life rarer condition drugs). Dentistry, prescriptions and opthalmics are all co-pay areas for the employed.

The second, broader point is that co-payment, by whatever mechanism (vouchers, top-ups, choose your poison) explicitly accepts that publicly commissioned services must perforce represent crap value for money.

Need this always be the case?

It's certainly true that NHS commissioning to date has mostly been weak and ineffective. As Alan Maynard has repeatedly pointed out, PCTs have been price takers rather than price makers. GP practice-based commissioning is, as we reported, ineffective and in retreat.

World-class commissioning was a series of good ideas, hampered by having started several years after the determined strengthening of providers under the foundation trusts movement (and without any incentive freedoms for top performers).

As UCLH maestro Sir Robert Naylor points out in his new HPI interview, "for any successful market (which is what the NHS has been trying to achieve for many years), you need clear distinction between buyers and sellers. If one is stronger than the other, it will compromise value".

What competition can do for the NHS
Competition, rather like information, is not perfect. It is a useful tool in the box, however.

For an excellent analysis of the potential good use of competition, I am happy to refer you to an excellent publication by the aforementioned Commission On 2020 Public Services: Dr Carol Propper's  'The operation of choice and competition in healthcare: a review of the evidence'.

Propper observes:
"It is important to distinguish between payer choice and patient choice, as they are not the same thing. In healthcare, the localness of the product often means that the number of hospital providers are limited, giving providers monopoly power. To redress this, purchaser power may be required. In this situation, payer choice may be more effective than patient choice. If payer choice is to operate well, this may mean restricting direct patient choice."

"While supply side competition has its limitations, the emerging consensus from robust studies appears to be that competition between providers under fixed prices will result in lower cost (growth) and better outcomes."

"If it is accepted that payer-driven competition is broadly beneficial, then the logic is that it should be promoted. This is likely to require regulatory intervention. Competition is intended to increase pressure on hospitals, something that hospitals, just as other firms in a market, are likely to want to avoid"

"Encouragement of greater choice in GP would be one way of moving towards patient choice of insurer and so introducing both demand and supply side competition."

"plurality allows better matching of consumer to healthcare supplier or to insurer. By allowing individuals to choose the supplier or insurer that matches their tastes, it may result in better outcomes at lower cost".

And finally ...
This should boost HPI up the search engine rankings: a magnificent report in The Independentreveals that Kensington and Chelsea PCT rented out a not-in-use hospital for location shooting for a porn film.

The Indy reports that during a Commons debate on transparency of government accounting, Conservative MP for Portsmouth North Penny Mordaunt said: "When I was director of Kensington and Chelsea Council, I discovered that one of our local hospitals was hiring out one of its closed - but fully-equipped wards - to a film company to use as a film set. To add insult to injury, the movie was a pornographic one. Although I cannot claim to have seen the final picture - as I understand, these things are no longer claimable on parliamentary expenses - it was a big-budget affair and generated substantial income for the hospital. But apart from cheering up a few of the in-patients, it cannot be said to be contributing to the objectives of the primary care trust (PCT)."

Nice quip about expenses, but otherwise dim-witted, no? The ward is closed. It is costing the PCT money. There is no "injury" in using a closed, cost-generating facility to raise income - this is not the Royal Surrey flogging drugs to profit on the weak pound. Or even close to being as morally dubious.

Porn is not everybody's cup of tea. It is, however, legal. A big-budget producer pays taxes, wages and "substantial income" to the PCT. Well done to them, frankly.