GP Fund Holding Scheme

HC Deb 13 March 1991 vol 187 cc945-54 3.30 pm

The Secretary of State for Health (Mr. William Waldegrave)

With permission, Mr. Speaker, I should like to make a statement on the implementation of the general practice fund holding scheme from 1 April 1991. The House will recall that the purpose of the scheme is to give those practices which wish to do so the opportunity to manage their resources for staff, prescribing and a specified range of hospital services. Practices are free to decide how they wish to spend money within those categories in the best interests of their patients. The general practice fund holding scheme is designed specifically to draw on the experience and expertise of general practitioners. It will encourage innovation in the health service and give the general practitioners concerned more freedom to determine the best use of resources within an overall framework of public accountability.

The general practitioner fund holding scheme is an entirely voluntary one. Eligibility is restricted to larger practices with more than 9,000 patients, or to smaller practices that group together to achieve this total. Since the details were first announced in December 1989, there has been a lively interest in the scheme, with almost 1,000 practices initially contacting their regional health authorities for further information. Regional health authorities have held detailed discussions with individual practices to ensure that they have the management capability to enter the scheme.

I am pleased to announce to the House that the names of 1,720 general practitioners in England in 306 practices are going forward to regional health authorities for approval as participants in the first wave of fund holding practices from 1 April 1991. The practices concerned embrace a total list size of 3.6 million patients, or about 7.5 per cent. of the total population. Regional health authorities are announcing the names as they give approval to the applications.

I should like to pay tribute to the practices which have chosen to participate in the first wave of the fund holding scheme. Like any pioneers, they have had to cope with difficulties which their experience will resolve for their successors. Everyone who has met the fund holders, as I and my ministerial colleagues have done, has been greatly impressed by their obvious determination to use the new scheme to raise the quality of services for patients and to explore more innovative methods of providing health care.

The House will equally wish to know that there is substantial further interest among practices in joining the scheme for future years. Practices will need to apply to regional health authorites by 1 April 1991 to participate in the second wave of fund holding practices to start on 1 April 1992. I am pleased to report that about 350 practices have already expressed an interest to their regional health authorities in joining the second wave of fund holding practices.

There has also been a significant interest among general practitioners in extending the fund holding scheme. In particular, I know that many practices with fewer than 9,000 patients would like to be able to join the scheme in their own right. In addition, many first wave practices have asked if the scheme could be extended to cover a greater range of services. I am very sympathetic to both those requests. Equally, I need to be sure that the expansion of the fund holding scheme does not outstrip the capability of the NHS as a whole to meet its needs, particularly as regards information systems and information technology.

I am therefore proposing to run from 1 April 1991 a series of demonstration projects to explore the possibilities for the development of GP fund holding. Approximately £250,000 will be made available for this purpose in 1991–92 by my Department, and additional support will be provided by regional health authorities.

We will be funding a number of practices with a list size of fewer than 9,000 patients to undertake a two-year project to establish how fund holding would work in smaller practices. Six projects in South-West Thames, Mersey, South-East Thames, North-West Thames, Oxford and Wessex regional health authorities have been selected. In addition, Bradford family health services authority will undertake a project looking at the role of the GP fund holder with regard to community-based health and social care services, and a similar project will be undertaken in two fund holding practices in Trent regional health authority. The latter project will also explore the possibility of including in the scheme a wider range of hospital services.

I emphasise to the House that general practice fund holding is not the only vehicle for allowing general practitioners to exercise more influence on service provision to reflect the particular needs of their patients. In particular, the new role of district health authorities as purchasing authorities requires them to work closely with local GPs. I look forward to this closer relationship developing further in a positive and constructive fashion. In taking GP fund holding forward, we will wish to learn from the development projects I have announced today, from the experience of the first wave fund holders, and from discussions with the representatives of the medical profession.

There is no doubt that empowering general practitioners directly as purchasers of care will be one significant means of improving the quality of services to patients and ensuring that those in daily contact with patients play a full role in discussions on service provision. This confidence has been fully borne out by our experience of the preparation for the scheme made in 1990–91 by the first wave of practices. I know that we have a secure foundation on which to start fund holding and clear enthusiasm for the future progress of the scheme.

Mr. Robin Cook (Livingston)

The Secretary of State was good enough to refer to these practices as "pioneers". First, may I ask the right hon. Gentleman about those GPs who fell by the wayside on the trail west? Will he confirm that last March 850 practices expressed an interest? Will he comment on the statement by the GP who has since withdrawn from the scheme, saying: I'll be surprised if budget holding does not collapse in the first year"; and that of the GP who withdrew, saying: The NHS is heading for a disaster"? Is not the Secretary of State left with only a third of the starters because the rest came to share those fears? Is he aware that agreements have not yet been reached with even the 300 who remain? May I advise him that this afternoon I spoke to representatives of a practice on his list who informed me that they still do not know how much they will get or how they will spend it? How does the right hon.

Gentleman expect budget holders to be more businesslike if he cannot tell them their budgets a fortnight before they start?

May I offer my congratulations to the Secretary of State on his caution in running pilot projects before he offers budget holding to practices of fewer than 9,000 patients? In view of that sensible precaution, why did his predecessor always refuse to run any pilot projects for the practices which take this leap in the dark today?

The Secretary of State promised that this measure would raise quality. Has he received the simulation of the scheme carried out in East Anglia? Does he know that it shows that pressure from budget holders tended to reduce the standard of treatment to what they could afford on a fixed budget? How can he hope to raise the quality of GP care by putting a cash limit on what GPs can spend?

If the Secretary of State really wants value for money, will he come clean on the cost of this scheme? Will he confirm that each of these practices will cost £32,000 more in administration? [Laughter.] I am glad that the hon. Member for Harlow (Mr. Hayes) finds that amusing. This statement will cost another £10 million for more managers, when what the NHS needs is more nurses and more doctors.

I invite the Secretary of State to comment on where his statement today leaves the patients of the other 10,000 general practices. May we have an assurance that there will be no double standards on the waiting list? What guarantee can the right hon. Gentleman give that budget holders will not be able to buy a fast track for their patients to jump the queue? [Interruption.] The hon. Member for Harlow is at least 24 hours behind the times. There is no debate.

Does the Secretary of State agree that his statement today confirms that, although his party has changed its leader, it is still following the same health policies? Has he not yet grasped the fact that at the election his party will pay for its drive to change a public health service into a commercial business?

Mr. Waldegrave

The hon. Gentleman made a number of small but significant factual errors, which seemed to show that he does not have a great grasp of the subject. The number of practices was not 850 but 950. The reason that many of them dropped out was that they were below the 9,000 patient limit. If the hon. Gentleman will investigate the matter, he will find that there is also a difference between units and practices. One of the main reasons they dropped out was that they were below the 9,000 limit.

The hon. Gentleman has once again underestimated GPs. He did it last year, spectacularly, when he said that they would not hit the targets in the contract—and they have. He is yet again underestimating them. We are already seeing in those GP fund-holding practices the winning of better quality care for their patients, and that is what they are about. It is entirely characteristic of the Labour party that it immediately says that, if somebody is better off, that must mean that someone else is worse off, so it is against the whole thing. GP fund holders are exploring with their own skills and energy how to get better deals for their patients. We should welcome that.

The hon. Gentleman raised the prospect of pilot schemes. The whole of the GP fund holding scheme as a voluntary scheme is, if one likes, a pilot scheme. We are talking about further investigations before the third wave.

As I said, I hope that we will have about 750 practices in the first two waves. A sum of £33,000 is given to GP fund holders for the scheme's administration. That is entirely well spent to gain the kind of service improvements that we are seeing in GP fund holding schemes.

I must warn the hon. Member for Livingston (Mr. Cook) that quite a lot of the schemes that I have visited—though perhaps a minority—are supporters of the hon. Gentleman's party, but greatly regret the bone-headedness of its response to the scheme. We should be looking at the possibilities for patient gains.

Dame Jill Knight (Birmingham, Edgbaston)

Will my right hon. Friend confirm that, although GPs' pay fell by some 14 per cent. under Labour, it has increased by about 36 per cent. under the Conservatives? Are not more doctors working today than ever before, and do they not have more staff in their practices? Does not the new contract mean that they have more money for night visits and for those aged over 75 on their lists? Will my right hon. Friend elaborate on the excellent service that this will mean for patients?

Mr. Waldegrave

My hon. Friend is entirely right. There are more GPs, more practice nurses, and smaller lust sizes in every region and every county. I am sure that, in their hearts, Labour Members welcome that as much as we do. It would be generous of them occasionally to acknowledge it.

The benefits that we are already seeing from GP fund holding include the development of the idea of consultants attending GPs' surgeries to hold clinics; improvements to a whole range of non-clinical quality—for example, limitations on waiting times, and GP direct access to services; and thoughtful and sensible improvements to services, which we shall now see imitated by the districts when they purchase their services, and by other GPs, whether or not they are fund holders.

Mr. Archy Kirkwood (Roxburgh and Berwickshire)

I acknowledge the fact that the health professionals to whom I have spoken welcome the much more accommodating tone of this Secretary of State for Health in comparison to the tone of some of his predecessors. I particularly welcome the idea to pilot the proposals for budget holders below the size of 9,000.

Is the Secretary of State aware of the concern about the lack of certainty about the level of budgets to be fixed for the start of the new year and the uncertainty about the item costs that GP fund holders may be charged by hospitals? Will the right hon. Gentleman also elaborate on central costs? I assume that a statement will be made about equivalent matters north of the border in Scotland.

Mr. Waldegrave

I am happy to re-emphasise that I am taking forward a policy that was invented, and carried into legislation, by my predecessor. I am proud to be doing that, because it is a very good policy.

With regard to budgets, regions are at present announcing their fund holders. I foresee no difficulties with the budget agreements. I would not have come to the House today if we believed that there would be arty problems in that respect. Next year's budgets are based on this year's spending and referral practice and, in addition, allow some service development. There will be no problems about that.

However, the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) made a good point when he said that, as we know, some of the disaggregated information is not yet available from hospitals. That is why most of the improvements in services that GP fund holders are winning for their patients are related to quality of service and not so much to costs. However, that is also very useful.

Mr. Nicholas Winterton (Macclesfield)

I thank my right hon. Friend for his useful and informative statement and for his constructive and sensitive attitude to the health service. Does he accept that GPs have a major—perhaps the major—role to play in health care? Will he assure the House that, under this new scheme of budget holding general practices, GPs will not be inhibited when prescribing the best possible medication and drugs for their patients in accordance with their clinical judgment or when recommending a patient to the best possible consultant in the best possible hospital for the treatment that that patient needs?

Mr. Waldegrave

I am grateful for my hon. Friend's kind words. I give him the assurance that he seeks. If a GP fund holder were to find that a patient or a group of patients, in the event perhaps of a local epidemic, were to take him above his budget, he would have the right to go back to the region for additional funds.

With regard to the more general point raised by my hon. Friend the Member for Macclesfield (Mr. Winterton), one of the main strengths of our health service is that we have a national system of quality GPs which other countries very much envy. Some of the most interesting developments in health care in the years ahead will probably come from the much closer integration of primary and secondary health care in the way set out in the management executive paper which I know my hon. Friend has seen.

Mr. Bob Cryer (Bradford, South)

What will happen if the money runs out after GPs have penetrated the maze of additional administration? What will happen if the money runs out after GPs have difficulties having prescribed according to medical needs and requirements instead of according to financial constraints? If that money is medically required, will the GPs be guaranteed the money?

Mr. Waldegrave

I have already answered that question in replying to my hon. Friend the Member for Macclesfield. The region will maintain reserve funds to deal with such problems. As usual, the Labour party is imagining difficulties where none exist. The GPs, who know a great deal about this, are queueing up to join the scheme. If they believed that the dangers described by the hon. Member for Bradford, South (Mr. Cryer) existed, they would not be doing that.

Mr. Jerry Hayes (Harlow)

Is not my right hon. Friend greatly encouraged by the fact that so many GPs are applying to participate in the scheme and by the fact that so many more are interested in the second wave? Is not that good news for GPs but far better news for patients? Is it not entirely predictable that all those things are completely anathema to the Labour party, which wants to abolish the scheme? Will he warn Labour Members that the electorate will not forgive them if there is another campaign cynically to manipulate the elderly, infirm and the vulnerable by telling them that they will not receive proper treatment?

Mr. Waldegrave

I strongly endorse what my hon. Friend has said. After the obvious and demonstrable falsification by the hon. Member for Livingston (Mr. Cook) and his predictions about the contract—no doubt made in good faith but demonstrably false—any campaign would carry little weight in any case.

Mr. Frank Field (Birkenhead)

Is there not some irony in the fact that the Secretary of State commends the reforms on the basis of what health professionals say, given that they come under the heading "Putting patients first"? How many patients have supported the reforms?

Mr. Waldegrave

The hon. Gentleman will find that, as patients have demonstrated to them the gains that their GP fund holders have won for them, there will be strong patient support. On the whole, GPs, as the closest representatives of patients, are the health professionals on whom it is wise to rely when we are seeking to introduce patient demands into the system. That is one of the strengths of our GP system.

Mr. Roger Sims (Chislehurst)

Do not the figures that my right hon. Friend has given demonstrate not only a misjudgment on the part of the Labour party but some doubt about the validity of the campaign that was run by the British Medical Association about a year ago? Will my right hon. Friend confirm that one result of GP fund holding is that GPs and their patients will have more choice in the consultants and hospitals to which they can be sent and that that is to the benefit not only of the patient but of the health service generally, because there will be shorter hospital waiting lists?

Mr. Waldegrave

That is exactly the gain for patients that the scheme will produce. I do not intend to rake over the coals of past anxieties on the part of the BMA. Many leading GPs, in all parties is so far as they have political affiliations, are now part of the scheme. That shows that it is a well-based scheme which many of the best doctors regard as worth while supporting.

Rev. Martin Smyth (Belfast, South)

The Secretary of State said that about 1,000 were in the first wave of applicants. I gathered that many of them dropped out because they had fewer than 9,000 patients. May we have the proportion? How many dropped out, and how many were not accepted by the Department? In the next wave of 350 applicants, how many were from the first wave? In the background papers, it is suggested that GPs may be limited in sending people to various hospitals if there are compelling reasons. What must those compelling reasons be, and who should decide what they are?

Mr. Waldegrave

Of the original contacts from those who wished information about the scheme when it was announced, many were ineligible. I am not sure whether we have the detailed breakdown of the reasons why some have since either not been eligible or have withdrawn. I shall examine that matter and write to the hon. Gentleman about it.

Judgments about where a patient should go must rest with doctors, and they will remain with them. Of course, the first-year budgets are based on existing referral practices, so I doubt whether there will be much change in the first year. However, if doctors wish to change, any effect will be taken into account in their costs in the second year because there will be further negotiation on their budget at the end of the first year.

Mr. Christopher Gill (Ludlow)

My right hon. Friend will be aware of my concern to improve management in the national health service. Is not the significance of making general practitioners fund holders the fact that they are put in a position better to manage their practices, thereby putting authority and responsibility into the same pair of hands?

Mr. Waldegrave

I entirely agree with my hon. Friend. I have visited a good many proposed and actual GP fund-holding practices. What impresses one most is the closeness of the team work between health professionals and managers in those practices. We shall see an expansion of the work done in local health centres. We shall also see perhaps a wider range of services available to patients. For example, there is no reason why a GP fund holder should not buy services for his patients in the private sector if he believes that that would be better for his patients. There will be wider patient choice as well as the other benefits.

Mr. Allen McKay (Barnsley, West and Penistone)

Will a record be kept to show whether such practices increase their referrals to hospitals? If a general practice is continually over budget, what effect will that have on the thinking of those involved; and if it does not have any effect, why have a budget in the first place?

Mr. Waldegrave

On the hon. Gentleman's second point, as I have said, there will be a renewed negotiation each year about the budget based on the outturn of the preceding year. The point of the budget is that the GP fund holder can shift resources between different heads, which he cannot do at the moment, and thus will have much greater freedom to spend.

The hon. Gentleman asked whether there will be an increase or decrease in referrals. I expect—several practices have told us this—that there will be a decrease in referrals because a number of minor surgical procedures, for which GPs are now paid, may well be performed at the practice surgery, which is often what patients want. Therefore, there will not necessarily be an increase in referrals. The opposite may well be the case.

Mr. Andrew Mitchell (Gedling)

Are not the Government to be congratulated, not least on the extra money that they have made available for computerisation? Does my right hon. Friend agree that, many doctors who feared the advent of computerisation have now had computers installed and cannot understand how they ever managed in the past without them?

Mr. Waldegrave

I know that my hon. Friend is well briefed on such matters. The coming of a proper information base for the health service is an absolutely vital investment for the future and is enabling not only GPs but the rest of the health service far more powerfully to manage resources for the benefit of the patients.

Mr. Gerald Bermingham (St. Helens, South)

Does the Secretary of State agree that, when calculating the budgets for the necessary administrative costs in both rural and semi-rural practices, which, because of their nature and catchment areas, are much smaller, great care should be taken to ensure that the appropriate administrative costs are built into the budgeting scheme, so that patients in rural and semi-rural areas are not disadvantaged?

Mr. Waldegrave

I thoroughly accept the hon. Gentleman's point. We shall be sensitive to that.

Mr. Andy Stewart (Sherwood)

Included in my right hon. Friend's statement is a leading health centre in my constituency, which has been pioneering preventive and community health care but which is concerned about reports that the drugs budget will be based on 1989 figures rather than on 1990 figures. Will my right hon. Friend confirm what he said to my hon. Friend the Member for Macclesfield (Mr. Winterton), and that drugs are included in what he said?

Mr. Waldegrave

Certainly. The most up-to-date figures will be used, whatever they may be at the time. I confirm what I said—that if the outline budget does not cover clinically necessary prescribing, that expenditure can be met from regional health authority reserves.

Mr. Eric Illsley (Barnsley, Central)

Is the Secretary of State aware that there have recently been problems when GPs have refused to prescribe high-cost drugs because of their fears that that high cost will have to be met from their budget? Will he implement any further safeguards in relation to the prescribing of high-cost drugs, especially child growth hormone? The right hon. Gentleman might be aware of the recent refusal by a Chester GP to prescribe such a drug. Will he make sufficient funds available to ensure that GPs do not refuse to take on to their lists patients who need high-cost drugs?

Mr. Waldegrave

With respect, the problem is not quite as the hon. Gentleman has stated it. In certain instances, there is a problem of hospitals wishing to pass on to GPs the cost of prescribing high-cost drugs. Some GPs are rightly, in clinical terms, refusing that, because the patient is not under their direction. We have no plans to change the arrangements in that respect. General practitioners remain uncash-limited in their prescribing.

Mrs. Edwina Currie (Derbyshire, South)

Does my right hon. Friend agree that, in retrospect, the reform of general practice will turn out to be one of the best things that this Government have done? Will he encourage GPs in Derbyshire, who have been a little hesitant, to take on board the reforms that he has announced today on the basis that if one wants to improve immunisation rates, one must immunise children; if one wants to do something about heart disease, one has to take blood pressure readings and encourage people to give up smoking; and if one wants the better management of resources, the GPs should be willing to do that themselves?

Mr. Waldegrave

I agree strongly with my hon. Friend. I have noted that there are now useful leaflets in the surgeries of a number of practices with which I am familiar setting out the improvements that have been made in the practice and in the services available to the patients. I note also the irony that many of the things for which GPs are now rightly taking credit are the things about the relative merits of which GPs expressed a certain amount of scepticism when we first asked for them.

Mr. Dennis Skinner (Bolsover)

On at least two occasions, the Minister has been asked what would happen if the money ran out in a budget-holding practice. He answered to the effect that it could get the money from the regional health authority. On occasions, regional health authorities run into debt; they have no balances. If the region is in difficulties, what guarantee will the Secretary of State give that the money will be paid? One thing is certain: if the Tories are lucky enough to win the next election, this statement is a prelude to charging patients for going to the doctor.

Mr. Waldegrave

One thing that is certain is that that is not the case. I have answered the question twice already. If procedures or costs arise which were not predicted when the budget was set, the GP fund holder can go to the region for the cost.

Several Hon. Members

rose——

Mr. Speaker

Order. We have a ten-minute Bill after this. I shall allow questions to continue for a further five minutes. If hon. Members ask brief questions, they will all be called, after which I shall call the Front-Bench spokesmen.

Mr. Kenneth Hind (Lancashire, West)

Budget holding will be an essential element in making the internal market work. My right hon. Friend the Secretary of State is probably aware that none of the practice budgets that he has approved today is in my constituency, as my constituency is predominantly rural. My constituents are deprived of the improved opportunities of budget holding. What is the average size of the practices which are in the pilot study? In future will practices with 6,000 patients or fewer have budget-holding status?

Mr. Waldegrave

Of course, a route is available to smaller practices in rural areas to seek fund holding. They can group together. A number have done so in rural areas. I recommend that route to GPs in my hon. Friend's constituency. As I said, we shall examine several studies of practices of the size to which my hon. Friend referred to determine whether it would be sensible to reduce the threshold level overall.

Mr. Barry Field (Isle of Wight)

Will my right hon. Friend confirm that GP fund holders on the Isle of Wight have one of the highest percentages in the Wessex region, if not the whole United Kingdom? Does he agree that that shows that the anxieties expressed by the doctors were misplaced and that budget holding will promote a dialogue between district health authorities and GPs which will be to the benefit of all patients? What assurance can he give to that tiny minority of luckless patients who are on the lists of doctors who are more interested in politics than in patients?

Mr. Waldegrave

I can give one example. It is a small matter but it happened to arise in my hon. Friend's constituency; it shows how the scheme is working on more important matters. The GP fund holders asked that if patients were kept waiting for more than half an hour they should be given a cup of tea. The hospitals said, "What about the other people?" The district health authorities said, "In that case, we shall give everybody a cup of tea." That is exactly how GP fund holding is working. Practices suggest improvements—my example was a small but not insignificant matter—which are then adopted more widely.

Mr. Geoffrey Dickens (Littleborough and Saddleworth)

Will my right hon. Friend confirm that budget practices will receive £16,500 in grant towards preparation and up to £33,000 for management costs and that the cost of the computer hardware will be completely reimbursed, including training and maintenance costs? Does he agree that that means that resources are following the ideas of the Government?

Mr. Waldegrave

My hon. Friend is entirely right. My predecessor won the resources to make the scheme work well. It is working well, and it will bring benefits to patients.

Mr. John Bowis (Battersea)

Does my right hon. Friend accept that the announcement that he is prepared to consider allowing practices with smaller patient lists to qualify for this excellent scheme is particularly welcome? Will he bear in mind the fact that not only rural areas have the problem? In inner city areas such as mine, with a moving and changing population and a high turnover in patient lists, if doctors are to meet the other targets which they have rightly been set, they cannot take on additional patients to qualify under the present scheme.

Mr. Waldegrave

I confirm what my hon. Friend says. There are smaller practices in inner urban areas to which the same route to GP fund holding is available. I know that many of them are exploring that option.

Mr. David Evans (Welwyn Hatfield)

Is my right hon. Friend aware that the Labour party, which is supposed to care about the health service, gave up an opportunity to debate it this afternoon? Is it not a fact that under the Government——

Mr. Speaker

Order. The hon. Gentleman must ask a question about the statement.

Mr. Evans

Is my right hon. Friend aware that, under this Government, there are more GPs, more nurses, more patients—more everything? We are the party of hot money and the Labour party is the party of hot air.

Mr. Waldegrave

I could not have put it better than my hon. Friend, although I must admit that there has been a cut in one thing—the size of GP lists, which is good for patients, who receive more attention from GPs.

Mr. Robin Cook

As the Secretary of State chose to query my figure of 850 GP practices having expressed an interest last March, may I advise him that I took that figure from a press release issued by his predecessor, which was no doubt unwise? Will the Secretary of State advise the House whether he got the figure wrong today or his predecessor got it wrong last March? Will he also confirm that each of those 850, or 950, practices received £16,000 for the start-up cost of becoming a fund holding practice? As two thirds of them have withdrawn their interest, what value for money did he get for the £9 million that went to those that have withdrawn?

Mr. Waldegrave

This is not a tremendously important point. I was trying to help the hon. Gentleman by showing that there were more initial telephone calls of interest than he said. Many of the applicants dropped out because the threshold meant they were ineligible. I am advised that the answer to the hon. Gentleman's question is that, when the press release was issued, another 100 practices applied.