OxDONS syndrome: the inevitable disease of the NHS reforms.

The financial demise of Oxford''s department of neurosurgery (OxDONS) was precipitated by the financial rules of the reformed NHS. In particular it was produced by the failure of "resources to follow patients"; the requirement that "prices have to follow costs"; and the use of private income for revenue expenditure, not capital expenditure. This process will eventually affect all hospital departments, but it affected the unit in Oxford sooner as it started as "efficient"--that is, underresourced--and has depended on income from extracontractual referrals and private work. Current NHS accounting rules act as a disincentive to private income being generated in NHS hospitals, and consultants should be aware of this.     

Effect of NHS reforms on general practitioners' referral patterns.

OBJECTIVE--To compare outpatient referral patterns in fundholding and non-fundholding practices before and after the implementation of the NHS reforms in April 1991. DESIGN--Prospective collection of data on general practitioners'' referrals to specialist outpatient clinics between June 1990 and March 1992 and detailed comparison of two time periods: October 1990 to March 1991 (phase 1) and October 1991 to March 1992 (phase 2). SETTING--10 fundholding practices and six non-fundholding practices in the Oxford region. SUBJECTS--Patients referred to consultant outpatient clinics. RESULTS--After implementation of the NHS reforms there was no change in the proportion of referrals from the two groups of practices which crossed district boundaries. Both groups of practices increased their referral rates in phase 2 of the study, the fundholders from 107.3 per 1000 patients per annum (95% confidence interval 106 to 109) to 111.4 (110 to 113) and the non-fundholders from 95.0 (93 to 97) to 112.0 (110 to 114). In phase 2 there was no difference in overall standardised referral rates between fundholders and non-fundholders. Just over 20% of referrals went to private clinics in phase 1. By phase 2 this proportion had reduced by 2.2% (1.0% to 3.4%) among the fundholders and by 2.7% (1.2% to 4.2%) among the non-fundholders. CONCLUSIONS--Referral patterns among fundholders and non-fundholders were strikingly similar after the implementation of the NHS reforms. There was no evidence that fundholding was encouraging a shift from specialist to general practice care or that budgetary pressures were affecting general practitioners'' referral behaviour.     

Present dangers and future threats: some perverse incentives in the NHS reforms.

The NHS reforms have come to mean all things to all men (and women). Identifying a market oriented purchaser-provider split as the conceptual heart of the reforms is still, however, useful. There are important perverse incentives in and around the NHS that are associated with the reforms; furthermore, many reactions to the resulting problems are paradoxical and often counterproductive. Hitherto most criticism of the reforms from the health policy and management community (as opposed to the professions and the public) has been tactical rather than fundamental. There are serious problems for the NHS associated both with the NHS market and with current, often tacit, strategies for the future of the service.     

Impact of the NHS reforms on English hospital productivity: an analysis of the first three years.

OBJECTIVES: To evaluate the effect of purchaser mix, market competition, and trust status on hospital productivity within the NHS internal market. METHODS: Hospital cost and activity data were taken from routinely collected data for acute NHS hospitals in England for 1991-2 to 1993-4. Cross sectional and longitudinal regression methods were used to estimate the effect of trust status, competition, and purchaser mix on average hospital costs per inpatient, after adjusting for outpatient activity levels, casemix, teaching activity, regional salary variation, hospital size, scale of activity, and scope of cases treated. RESULTS: Real productivity gains were apparent across the study period for NHS hospitals on average. Casemix adjustment drastically improved cross sectional comparisons between hospitals. Gaining trust status and increasing host district purchaser share were associated with productivity increases after adjustment for casemix, regional salary differences, and hospital size and scope. Hospitals that became trusts during the study period were on average less productive at the beginning of the period than those that did not, and there were no significant productivity differences between trust waves at the end of the period in 1993-4. Market concentration was not associated with productivity differences. CONCLUSION: Further analysis is needed to determine whether overall and trust associated productivity gains are transient effects, one off shifts, or self perpetuating reorientations of organisational behaviour. Hospitals may have chosen to become trusts because they anticipated being able to increase productivity. Increases in the proportions of small purchasers were associated with increasing costs. Importantly, this study could not adjust for changes in the quality of care.