Modernizing
UK health services:
‘Short-sharp-shock’
reform, the NHS subsistence economy, and the spectre of health care famine
Bruce G
Charlton MD and Peter Andras PhD
Correspondence to:
Bruce G Charlton MD
Reader in
Evolutionary Psychiatry
Henry Wellcome
Building
Medical School
University of
Newcastle upon Tyne
NE2 4HH
Tel - 0191 222 6247
Fax - 0191 222 5622
e-mail -
bruce.charlton@ncl.ac.uk
Dr Peter
Andras
Lecturer
School
of Computing Science
University
of Newcastle upon Tyne
NE1 7RU
Keywords: NHS, modernization, reform, competition,
systems theory.
Abstract
Modernization is
the trend for societies to grow functionally more complex, efficient and
productive. Modernization usually occurs by increased specialization of
function (eg. division of labour, such as the proliferation of specialists in
medicine), combined with increased organization in order to co-ordinate the
numerous specialized functions (eg. the increased size of hospitals and
specialist teams, including the management of these large groups). There have
been many attempts to modernize the NHS over recent decades, but it seems than none
have significantly enhanced either the efficiency or output of the health care
system. The reason may be that reforms have been applied as a ‘drip-drip’ of
central regulation, with the consequence that health care has become
increasingly dominated-by the political system. By contrast, a
‘short-sharp-shock’ of radical and rapid modernization seems to be a more
successful strategy for reforming social systems – in-between waves of
structural change the system is left to re-orientate towards its client group. An example was the Flexner-initiated reform
of US medical education which resulting in the closure of nearly half the
medical colleges, an immediate enhancement in quality and efficiency of the
system and future growth based on best institutional practices. However, short-sharp-shock
reforms would probably initiate an NHS ‘health care famine’ with acute
shortages and a health care crisis, because the NHS constitutes a ‘subsistence
economy’ without any significant surplus of health services. The UK health care
system must grow to generate a surplus before it can adequately be modernized. Efficient
and rapid growth in health services could most easily be generated by
stimulating provision outside the NHS, using mainly staff trained abroad and
needs-subsidized ‘item-of-service’-type payment schemes. Once there is a
surplus of critically vital health services (eg. acute and emergency provision)
then radical modernization should rapidly improve the health service by a cull
of low quality and inefficient health care providers.
Defining
Modernization
There is a
long-term, international social trend towards a progressive increase in the
functional complexity of society, or ‘modernization’, which seems both
inevitable and – on the whole – beneficial (Charlton & Andras, 2003).
Modernization
originally referred to the contrast and transition between a ‘traditional’
agrarian society and the kind of ‘modern’ society that is based on trade and
industry (Gellner, 1988). For example medieval England was a traditional
society while late-Victorian Britain was modern. One difference is that a
traditional society is ‘vertically’ organized by hierarchical division by class
or caste – which is a specialization of prestige. But a modern society is primarily
organized by function, and divided into a mosaic of modular social systems such
as the political system, the public administration (civil service), the armed
forces, the legal system, the economy, religion, education, the health service
and the mass media (Pokol, 1991; Luhmann, 1995).
Modern and
traditional societies differ according to their complexity of organization and
their rate of growth in complexity. Traditional societies are simpler in
organization and have an almost static structure while modern societies are
much more complex and are perceptibly growing in complexity (Wright, 2000). The
most obvious form of increased complexity is the division and specialization of
labour (Smith, 1910; Ridley, 1996). Complexity is favoured by evolutionary
mechanisms because specialization of function enables greater efficiency - for
instance by the use of industrial assembly lines, or when increased trade
enables countries to specialize in what they are best at. Increasing efficiency
then frees resources which can be deployed to generate further growth. There
can be a positive feedback cycle where increased productivity fuels increased
functional complexity, which in turn fuels increased productivity.
Modern societies
are therefore based upon growth in complexity, and the expectation of further growth.
Indeed the cohesion of modernizing societies requires more or less continuous
growth (Gellner, 1988), and in the long term there must be growth in the
efficiency and output of all the main functional social systems (Charlton &
Andras, 2003). Growth in modern societies includes economic growth (increasing
output and productivity), but also entails ‘cognitive growth’ - which means an
increase in knowledge and capability across a wide range of activities such as
science, technology and political administration. At present almost all
societies are at least partially modernized (since the original kind of simple
‘hunter-gatherer’ social organization is extinct) but the rate of modernization
is variable between societies, and between systems in a society.
Since modernization
is dynamic, it is more useful to consider modernization as a process
than as a structure (Charlton & Andras, 2003). A ‘modern’ society is therefore
one based on the process of modernization: this is ‘modernity’. Modernization
can be seen as the general mechanism by which the social transformation from
agricultural dominance to one of domination by trade and industry takes place,
and the ‘permanent’ (ie. without any known end-point) continuation of this
process. The difference between modernizing and traditional societies is
profound - being the difference between simple static structure and complex
dynamic process.
In a modernizing
society such as the UK, it would be expected that social systems such as the
health service should have an intrinsic tendency to grow in functional complexity
– hence efficiency and output - over time.
Functional
complexity
The increasing
complexity of modernizing societies enables an increased efficiency of
information-processing, where ‘information’ is interpreted very generally to
include all entities with meaning in systems (such as money, agricultural
produce, industrial goods, human minds); while ‘processing’ includes any
transforming social activities such as economic production in factories, trade,
markets, formal education, the health services and the activities of the mass
media. For example, increased economic productivity entails increased
complexity of information-processing by increased division and specialization
of labour, increased complexity of economic organizations (factories, offices
etc), and the increasing use of complex machines and (more recently) computers.
This potential
adaptive advantage for more complex systems is the underlying reason why
biological evolution has generated ever-more-complex organisms over the history
of life on earth (Ridley, 1996, Wright, 2000). The largest and most dominant
organisms in the history of life on earth are late products of evolution (Maynard
Smith & Szathmary, 1995) and still extant: the most dominant animals in
terms of biomass are complex social animals (humans in the temperate zones and
ants in the tropics), and the largest ever human social organizations (nations,
corporations, bureaucracies etc.) are in existence today.
Increased
organizational complexity does not inevitably generate increased
efficiency, since complexity increases the need for communication and
co-ordination, so there are always costs to complexity which must be outweighed
by increased efficiency. But in modernizing societies there is a selection
pressure on each social system by other social systems to increase their output
to a greater extent than they increase their input of resources, which means
that there is an evolutionary tendency for more functionally efficient
increases in complexity to survive, while increases in useless or damaging
complexity tend to be eliminated over time (Charlton & Andras, 2003). Of
course, selection is a ‘trial and error’ process, having the tendency to
improve efficiency only on average and over the long term. Selection does not
generate perfectly efficient mechanisms or optimal solutions, and short-term
changes may be less efficient. Nonetheless, the global tendency is towards
greater complexity and efficiency (Wright, 2000).
Increasing
complexity of systems usually takes the form of increasing functional
specialization – which entails a more modular structure; and increasing
complexity of organization in order to coordinate these specialized functions.
The increased need for coordination of specialist functions is the probable
basis for the evolution of management in modern societies (Charlton &
Andras, in the press). In biology this can be seen as the trend for progressive
increase in complexity of life forms throughout the history of life – starting
with single cell organisms, then ever-larger multi-celled organisms, then
social organisms with the evolution of elaborate mechanisms for coordinating
these specialized functions. By the time modern humans evolved about 200 000
years ago the organism has become so complex, with so many specialized cells,
tissues and organs and the organism operating in so complex a social
environment, that twenty percent of its resources are used by the brain in the
co-ordination of bodily functions. The brain is itself divided into many highly
specialized regions, whose activities are integrated by ‘working memory’
occupying a large volume of pre-frontal cerebral cortex. Similarly, the modern nation or
multi-national corporation is constituted by hundreds of highly specialized
workers co-ordinated by proportionately large governments, public
administration and management systems (Charlton & Andras, in the press).
Modernizing
societies are therefore already-complex societies that display the tendency to
become more complex with time - this increasing complexity being kept under
selective pressure for improved efficiency. Increasing complexity is typically
attained by increased specialization of function and increased organization of
these specialized human functions. Ultimately, many aspects of human cognition
and labour may be replaced by computers and machines. In effect, complex
cognitive activity is replaced with complex forms of organisation (Charlton
& Andras, in the press).
The implication is
that health services will also tend to increase in complexity with time by
increased specialization and organization, so that the system can continue to
expand its ‘output’ of health interventions to a greater extent than it expands
its ‘inputs’ such as time, energy, money and personnel.
Consolidation and innovation
If we generalize
about the typical pattern of modernization in social systems, it emerges that modernization
typically consists of a dual process of consolidation and growth - rather like
bone development in which a growth plate extends the bone while laying down a
stable structure to support itself. Modernization is a dual process in which
efficiency savings in unchanging (or slowly or infrequently changing) core
activities of the system are used to generate adaptive innovation at the
cutting edge of growth.
Consider the
example of surgery. Many aspects of surgical procedures are standardised
routines, common to many types of procedure. Performance of these standard
routines of patient preparation, anaesthesia, tissue-handling, diathermy,
swabbing, suturing, etc. form a basis
for the highly specific techniques which require high-level expertise
compounded of focused training and experience. Such standardisation is vital
because it enables efficient methods of achieving reliable outcomes of
predictable quality (Charlton & Andras, 2002).
But progress in
surgical techniques - functional innovations leading to cognitive growth of the
discipline - has substantially been generated by ever finer division of
expertise among surgeons who specialise in ever smaller anatomic regions and
types of operation. This allows specialist surgeons to achieve higher levels of
experience including practice of techniques, to be able to compare the outcomes
of variations in diagnosis and treatment, and to achieve a greater depth of
theoretical understanding of their area of work. In effect, it was the routinization
of standard surgical practice that enabled the concentration of attention and
effort required to drive innovation. The consequence is that the core standard
procedures do not change very rapidly, and it is the margin of highly
specialized practice at which growth of the system of surgical technique tends
to occur.
Modernization therefore
entails specialization, which drives both de-skilling and hyper-skilling:
deskilling of core standard procedures and hyper-skilling of the marginal specialized
practices which build-onto this relatively stable and reliable core. In health
services this probably implies a standardization, routinization and deskilling
of unspecialized medical practice, in which complex integrated tasks are broken
down into sequences of simpler and less-skilled tasks; but encouragement of
variation, innovation and growth of the health care system among specialists.
This analysis
indicates that policies designed to produce an efficient, uniform, reliable
service, and to minimize the deleterious effects of human error and
inconsistency, are appropriate for standard core aspects of the health service;
but such policies of ‘rationalization’ need to be balanced with complementary
policies to encourage innovation and growth in complexity of specialized
service provision.
Selection mechanisms
The strength of
modernizing societies (and also some of their weaknesses) is a consequence of
the effect of selection mechanisms acting on social systems (Hull, 2001). It is
selection that best accounts for the long-term success of those paradigmatic
exemplars of modernizing societies: science, market economics and democratic
government (Charlton & Andras, 2003). Understanding the power of selection
mechanisms is necessary to understanding how to modernize the health service.
Traditional
societies solve problems by application of what they already know. This may be
a highly ‘rational’ process (for example, the development of formal logic was more
advanced in the late Middle Ages than it was in the following Renaissance era –
and was not surpassed until the nineteenth century; Broadie, 1985). But when problems
are not amenable to rational application of existing knowledge, then
traditional societies can get stuck. By contrast, modernizing societies use
selection processes acting on social systems to work-out the solutions to
difficult problems. For instance, the basis of democracy is that a society does
not know the best way to govern the country in the long term – and acknowledges
that future problems may not be amenable to current policies and procedures.
Democracy involves continually generating alternative political programs, and
choosing between them at periodic intervals. Science, likewise, does not know
how it will solve future problems, but instead encourages the generation of a
variety of ideas which ‘compete’ in the scientific marketplace to see which
performs best at predicting observations (Hull, 2001).
The crucial point
it is the process of selection itself that generates solutions to
problems, often unforeseen solutions, and builds upon successful solutions. In
biology, the immune system does not know in advance which antibodies (of the
billions it could make) are the best ones to defeat a particular bacterium.
Instead, the process works by generating antibody variants which compete, and
those variants which best bind to the bacteria are reproductively amplified. Likewise,
the ‘best’ car, DVD player, eating apple, or television program are not
pre-decided by the application of rational analysis, but emerge as the outcome
of economic competition. A closer comparison to health services would be the
educational system, where it seems that the long-term superiority of the US
universities was generated by the operation of selection mechanisms, by means
of competition for student demand among a wide diversity of autonomous
institutions with numerous sources of financial support (Trow, 1991). The ‘free
market’ in US higher education stimulated excess provision, and competition tended
to preserve and expand those institutions which best satisfied the operative
demands (especially fee-paying students).
Naturally, there
are inherent limitations to selection mechanisms. Selection does not generate
the one best solution, but selects the better solutions over the less good ones.
And because continued selection incrementally builds upon the successes of the
past this often entails also building on the limitations of the past. It can
become very difficult to change fundamental social processes because so much
has been built upon them (eg. national legal systems vary considerably and are
difficult to harmonize). Furthermore, selection can only operate by a series of
incremental improvements, so that selection may block foundational changes that
are beneficial in the long term, but too damaging to thrive in the context of short
term competition. It may, in principle, be beneficial radically to re-organize
an inefficient health system, including its core procedures, but this could not
be done if the resulting disruption to health services was so severe as to
endanger the population. But selection is also ‘wasteful’ – at least in the
short term – because it requires a surplus of variations to enable competition
– and of course most of these variations will turn out to be inferior – and
some may actually be worse than what went before. Selection processes are
inefficient in the short-term, because selection depends on the over-production
of competing variants, and most variants will become extinct. For example,
large numbers of US colleges and universities have ‘gone bust’ during higher
education’s history of educational expansion (Trow, 2003).
The short-term
‘wastefulness’ of selection has the excuse that it generates longer-term
efficiency. Indeed, selection is probably the only known process for reliably
producing systems that are both functional and efficient (Hull, 2001). It is,
after all, how life on earth emerged, specialized and came to fill every
available niche on the planet (Wright, 2000; Charlton & Andras, 2003). In
the long term the solutions discovered by selection tend to be functionally
adaptive (although seldom optimally adaptive) because the solutions which
survive are those who have demonstrated themselves superior in competition. The
information-processing power of social selection mechanisms such as science, political
democracy or the economic market is still insufficiently appreciated – indeed
it is not widely appreciated that science and democracy are selection-based
processes. Instead, it is often believed that the most
intellectually-sophisticated approach to social problems is rational and
technocratic, with experts gathering all relevant information and developing
the ‘one best plan’ which accounts for all imaginable contingencies.
But in a growing
and functionally-specializing society, planning cannot take into account the
novel consequences of future growth. For instance, health service planning in a
growing system cannot - even in principle - take into account the effects of
new health care technologies, new systems of management or the impact of new
governments. But selection mechanisms can (usually) cope with unforeseen
changes. The system is continually generating a surplus of variants, these
variants are competing with each other and with existing practices, some variants
survive and grow while others are suppressed, and the system builds upon
successful solutions – as it were to grow-around and past obstacles. Selection
systems are not just self-corrective, but also innovative.
The implication is
that creating health systems which will tend to be self-modernizing in the
long-term requires more than rationalization and standardization – it requires
that appropriate selection process are built in to the system. Currently the
main selection force, the external system that determines who survives and
thrives in the NHS, is government – but is it becoming clearer that a health
system regulated primarily by government has significant and intractable
deficiencies.
Modernizing the NHS
There have been
many attempts to 'modernize' the organizational structure of the NHS over
recent decades and another such attempt is underway. In this context, modernization
refers to the attempt to enhance quality and/or efficiency in the NHS by means
of structural re-organisation imposed from central government. Yet the perceived
outcomes of these attempts at modernization have been inconclusive in terms of
the stated aims of enhancing quality or efficiency of services (Klein, 1995; Le
Grand, 1993; Ham, 1997).
It is, indeed,
possible that previous reforms have overall done more harm than good, since the
many attempted re-organizations have made the health system highly politicized
(Andras & Charlton, 2002). Currently, management of the NHS is
excessively driven by the usually short-term agendas of day-to-day politics,
rather than the much longer-term (and differently-directed) strategies required
for achieving health-related goals. NHS modernization so far could be characterised
as gradualist in effect, even when radical in rhetoric (Klein, 1995): a
long-term, sustained, 'drip-drip' strategy of centrally-driven,
incrementally-imposed change. Politicization is an inevitable consequence of this
sustained history of interaction between the NHS and the political system (Charlton
& Andras, 2003). The major factor governing the regulation and funding of
the NHS has become the requirements of the political system. The health demands
of the population only affect the NHS via the political system as expressed by majority
voting on a broad political program every four or five years, and by political lobbying,
pressure-groups, media-campaigns and other attempts to influence policy (Andras
& Charlton, 2003).
The key question
concerns how NHS modernization can be initiated and maintained by central
government without the unwanted side-effect of politicizing the health service.
The answer seems clear. Most of the un-controversially 'successful' examples of
modernization of complex social institutions (ie. reforms that achieve their
intended aims) have involved the opposite strategy from drip-drip incrementalism.
We suggest that
intermittent rapid, radical, short-term reforms are a much more effective
strategy than a continual drip-drip of regulation. This style of 'short-sharp-shock’
modernization aims to reconfigure the social system so that henceforward it
operates on different principles. After this abrupt transition the government (or
other reforming agency) steps back and reduces its influence until a further
wave of radical reform is required. In-between cycles of reform, institutions are
allowed to retain their primary functional orientation – which ought to be towards
client groups, rather than that politicians and other regulators.
A medical short-sharp-shock
- The Flexner Report
Short-sharp-shock modernization
has usually been the most successful type of reform in economics. For instance,
the most dependable way for monetary hyper-inflation to be brought under
control is to take radical, decisive action - such as introducing a new
currency, or slashing noughts off the value of existing currency. For example,
in 1948 10 Reichsmarks were exchanged for 1 Deutschemark (approximately),
wiping-out hundreds of billions worth of savings but creating a stable currency
that formed the foundation for Germany’s post-war prosperity (Radice, 1995). Such reforms are inevitably
painful in the short term, often leading to a recession (which is why their
introduction is so often delayed), but if this phase can be survived then the
strategy may be extremely effective in the long term.
One of the most
successful modernizations in the field of health care took place in US medical
education in relation to ‘The Flexner Report’ (Flexner, 1910). Abraham Flexner
was a (non-medically qualified) educationalist who toured the USA and Canada
between 1908 and 1910, personally inspecting all 155 medical schools then in
existence. His purpose was to evaluate their quality in comparison with a clear
agenda for reform based on the ideal of the best German Universities. Flexner’s
vision of medical education had the objective of shaping the medical profession
into a scientific elite. Flexner believed that medical schools ought to have
high entrance requirements, a large and well-trained faculty, good laboratory
facilities, and integration between of scientific and clinical work.
Instead of
embarking on the complex and slow ‘drip-drip’ strategy of trying to ‘turn
around’ failing institutions and produce all-round improvement in a complex
system; reformers who supported him adopted the simple, swift and
straightforward strategy of bringing pressure to bear that led to the closure
of the worst medical schools. The immediate outcome was to improve the quality
of the output of medical graduates, and in the longer term the future growth of
the medical educational system was modelled on institutional examples of best
practice.
Rapid progress
towards these goals followed-on the publication of his report, and the main
engine of progress was closure of those medical schools which most obviously
failed to meet Flexner’s ideals. By 1920 the number of medical schools had
almost halved down to 85 with an immediate improvement in the average standard
of medical education (Bowman, 2004). Like any effective modernization,
Flexner’s imposed costs, such as the domination of US medicine by
scientifically-trained hospital specialists, and the closure of all three
medical schools for women and five of the seven medical schools for African
Americans (Hiatt, 1999). Nevertheless,
judged by its own objectives, the modernization of US medical education was a
resounding success.
The features which
enabled this successful short-sharp-shock modernization are instructive. First
there was the rapidity and radical nature of reform. Secondly there existed a
surplus of ‘output’ from the medical school system, an over-production of
doctors such that many found it hard to make a living. As Flexner (1910) said;
‘the country needs fewer and better doctors… the way to get them better is to
produce fewer’. And thirdly there was a consensus among significant interest
groups concerning the aims of reform, including the identities of the best and
worst medical schools.
The NHS subsistence
economy
Why then has
short-sharp-shock institutional reform not been carried-through in the NHS -
despite often being threatened and sometimes initiated (Klein, 1995)? The
probable reason is that, although radical modernization is usually more
effective in achieving its objectives than drip-drip incremental reforms, the
strategy carries the significant disadvantage that long-term gains in quality
and efficiency can only be attained via a short-term but significant reduction
in output.
This is seen in
economic reform when effective anti-inflationary policies or measures to
enhance productivity lead to a short-term recession - even when they offer
substantial long terms benefits (Sargent, 1982). Re-organisation of systems
uses resources in the short-term and this usually means that a resource-freeing
phase of simplification precedes the phase of increasing adaptive complexity. Modernization
is therefore easiest in growing systems with a surplus of output in which the
costs of reorganisation can be paid from growth and in which the surplus will
cover the temporary decline in output.
However, the NHS has
no significant surplus of health services – in effect, it is a ‘subsistence
economy’ with zero spare capacity. This
is because the NHS aims to produce exactly the amount of health care ‘needed’
(according to the calculations of health politicians, managers and other
planners) and no more than what is needed. Any accidental surplus of health
care provision is taken to be evidence of inefficiency, and subjected to
downward cost-cutting pressure. The consequence is that the NHS produces only
just enough output to satisfy public health demands. Indeed, much managerial effort
is put into demand management, with campaigns to reduce the public's use of
services, and tight regulation over expenditures such as prescribing and
capital equipment.
If anything it
seems likely that public demand for health services is indeed considerably greater
than the NHS can provide. After all, most subsistence economies throughout
history (and currently in much of the third world) have operated at average
levels of output which produced endemic semi-starvation with fairly frequent
episodes of actual-starvation (Gellner, 1988). The NHS subsistence economy means
that health care shortages can be precipitated by trivial blips in demand such
as a harsh winter or an influenza epidemic.
The clear
implication is that short-sharp-shock modernization of the NHS, although it
would probably be effective, is unfeasible because the short-term reduction in
the 'output' of health services that would be produced by radical re-organization
would precipitate severe shortages of health services: a health care
famine.
Modernizing UK
health care
The spectre of
health care famine has probably been a major factor in preventing any effective
program of NHS modernization over the past few decades. Since the NHS
subsistence economy rules out short-sharp-shock reform; by default, successive
governments have been forced to regulate the NHS by an almost continuous
drip-drip of regulatory initiatives, which has had the unintended effect of
politicizing health care.
Effective modernization
would be possible only if the provision of UK health services could first grow
to generate a significant surplus capacity – or at least a surplus in those
critical areas most vulnerable to health care famine (eg. acute and emergency
services). However, implementing the phase of pre-modernization health care
expansion is not easy – because the un-modernized NHS has very probably
accumulated considerable inefficiencies over the past few decades of inadequate
reforms – and these inefficiencies have no doubt been exaggerated further by
the unrelenting effects of politicization. This appears to be confirmed by
recent UK attempts to expand NHS provision of services by large injections of
funding. It appears that while a great deal of extra money has gone into the
NHS, little in the way of extra services has (so far) come out of the other end
(The Economist, 2003). It seems plausible that extra investment is failing to
provide ‘good value for money’ – which weakens the national economy.
Another possible
approach would be to expand health services without expanding the NHS. New
forms of health care provision could be encouraged in the critical areas most
vulnerable to ‘famine’. Such services might be designed to be rapidly sensitive
to demand, for example by using (means-tested-subsidised) item-of-service forms
of payment. Such a rapid expansion of health care provision would entail
substantially increasing the numbers of health care personnel, which could only
occur by the large scale importation of a migrant health care workforce – and
indeed this may already be happening in the UK. Alternatively, or in addition,
elective and non-vital services might be transferred out of the NHS and into
the private sector (presumably with a needs-based system of subsidies for the
poor). At the same time the NHS could re-direct its resources into the critical
areas of need. This would continue until there was a significant surplus of
acute and emergency services in the NHS. Only when this point of surplus has
been reached could the NHS effectively be modernized.
When a surplus of
health services has been generated, then this will be the appropriate time for
a Flexner-like cull of less efficient and lower quality health care providers,
accompanied by incentives for the more efficient and higher quality providers
to use their spare capacity to expand and take-up the slack. Following modernization
the health care system would immediately have a higher average quality
and efficiency; and further growth of health services would come from expansion
of the best institutions and practices.
Short-sharp-shock
modernization entails an acute phase of rationalization and re-structuring. In
principle this ‘culling’ could be done by government (for example on the basis
of performance-indicators and ‘league tables’) but in practice this seldom
happens – probably because regulators are unwilling to diminish their power and
influence by widespread closure of institutions. For example, compared with
closing hospitals, it would be very straightforward to close under-performing
and unpopular schools, yet this is very seldom done (instead these schools are
expensively propped-up by extra-funding and new management teams). In practice,
selection seems to be done most effectively when there is no specific
individual made responsible for it, and when outcomes such as institutional extinction
are an outcome of competition rather than bureaucratic diktat.
A modernizing ‘cull’
of ineffective or inefficient providers in the NHS might best be achieved by
competition for client-linked funding. The model could be the history of university
expansion in the USA (Trow, 1991; 2003) in which a surplus of diverse,
autonomous institutions competed for student fees. The higher education system
which evolved is highly sensitive to the demands of students, and contains a
vast diversity of provision - including highly-accessible vocational training,
elite liberal arts colleges and the best research universities in the world.
If a diverse health
service that is similarly sensitive to patient demands is required, then health
care funding (including subsidies) should be channelled mainly via patients -
instead of being allocated directly to institutions by the decisions of politicians
and civil servants.
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