Text of lecture: Why do all the forbidden words in the NHS begin with R: “Rationing”, “Reorganisation” and Rationalisation.

Over the next 40 minutes or so I will attempt to explore a serious problem of resource allocation and health rationing in the NHS and, I hope, show that this problem is far from unique to the NHS but also exists in healthcare systems throughout the world. And I will end with a call for those who are leading the NHS in our communities up and down the country to play their part in leading public debate on these difficult issues. Continue reading

Do CCGs have power or a duty to pay out for past PCT NHS Continuing Care errors?

The NHS has paid out vast amounts – probably hundreds of millions of pounds – in recent years as a result of decisions that patients were not entitled to NHS Continuing Care (that where the NHS meets the costs of a package of social care and accommodation outside a hospital).  Mostly these are claims by relatives of deceased patients who objected to paying nursing home fees for elderly patients who were classified as “social care” rather than being eligible for NHS Continuing Care.

Several attempts have been made by the NHS to stop new claims but these have not been too successful because the claims, based on alleged maladministration, continue.  The “liabilities” associated with NHS Continuing Care claims were supposedly transferred from primary care trusts to CCGs in the Transfer Orders which transferred assets and liabilities from PCTs to CCGs.  The intention was that CCGs should pay out for past NHS Continuing Care errors made by the PCTs. 

However there is an interesting twist to all this.  Whoever drafted the Transfer Scheme appears to have assumed that pay outs for past NHS Continuing Care errors were “liabilities” which could be transferred from PCTs to the new CCGs.  In fact payments for these claims were never “liabilities” but were only ever ex gratia payments made voluntarily by PCTs.

Does this matter?  Well yes because it means that CCGs have no duty to make payments out of their current assets for past errors made by CCGs.  In fact not only do CCGs have no duty to make these payments, they probably don’t have any power to do so either.  The practical effect is that CCGs should reject all claims for ex gratia payments for past NHS Continuing Care claims.  That is probably not quite what the Transfer Orders intended but would be one way to make sure that CCG monies are used for their intended purpose – namely paying for healthcare in the current year rather than making up for the sins of past NHS bodies in past years.

Should accident victims who get a payout be entitled to free NHS care?

At a time when NHS bodies are under more financial pressure than ever before there is one anomaly which is worth highlighting. Personal injury victims can be paid damages on the basis that they will claim the cost of private medical care but then such a person is entitled to keep the damages and demand free NHS care.

This anomaly arises because patients who are injured in a road traffic accident, an accident at work or as a result of negligent hospital treatment (or any other personal injury claim) are entitled to seek the future costs of their medical care as part of a damages claim. As a result of an Act of Parliament passed in 1948 when the NHS created, a defendant (whether the NHSLA or an insurer) is not allowed to insist that the tort victim uses NHS services instead of seeking private care. The NHSLA or insurer has to pay the cost of future medical bills on a private basis. Hence an NHS Trust can be forced to pay damages for a clinical negligence victim to be provided with future care funded by BUPA.

However, once such a person has been awarded damages as a result of a trial or in a settlement (which will often be less than the full amount of their claim) there is no obvious legal mechanism in the National Health Service Act 2006 to stop such a person going to their local CCG to demand NHS medical care free of charge. Thus a person can be paid out for the costs of health and social care and still claim NHS Continuing Healthcare, which means all of his or her healthcare needs will be funded by the CCG. This seems completely unjustifiable at any time but particularly when NHSbudgets are under so much pressure.

We all lose out as a result of this anomaly. The cost of road traffic insurance payouts are met by the car insurance we all pay; employers pay liability insurance and we pay for these in the goods and service we all buy and NHS payouts are met from NHS funds. So why should someone be able to claim the cost of private medical care and be paid out for that sum, and then be able to obtain the same care from the NHS without payment?

What is the solution? One way forward would be for Secretary of State to use the power to make Regulations to require such persons to pay for the NHS services for which they have claimed compensation. There are Regulations which require overseas visitors to pay for hospital care. There does not appear to be any reason why the Secretary of State could make Regulations which allow NHS bodies to charge for the provision of NHS services where a patient has made a claim in a personal injury or clinical negligence case for the costs of that type of medical care up to the value of the sum claimed for medical care in the damages claim. A change in the law might cure this anomaly and thus both reduce our car insurance bills and add to the coffers of the NHS at the same time.

Will the government do this? I am not holding my breath.

Trust Special Administrators have their powers clipped by the Court of Appeal in Lewisham case and government attempt to reverse this looks ineffective.

The problem of how to tackle poor performing NHS Trusts has dogged the NHS for many years.  Companies that fail can be put into liquidation, factories close down and people lose their jobs.  However a failing hospital is not a factory.  An overspending hospital cannot “fail” and be closed because that would leave local people without acute health services.

Traditionally the NHS has changed key management roles at failing hospitals in an effort to turn them around.  However that model has its limitations and so a new structure of “Trust Special Administrators” was brought in by the Health Act 2009.  That introduced a new chapter 5A into the National Health Service Act 2006.

The regime of Trust Special Administrators.

A Trust Special Administrator (“TSA”) has many similarities to an administrator of a private company appointed under the Insolvency Act 1996.  The TSA takes over the role of the Chairman and Board of the Trust and so is able to exercise management powers to run the Trust.  The TSA is allowed to by-pass the usual extensive consultation requirements when making changes to the services provided by the Trust.

However the TSA is also required to follow a truncated consultation process before preparing a plan setting out the action that he recommends the Secretary of State (or Monitor in the case of a Foundation Trust) should take “in relation to the Trust”.  The meaning of the phrase “in relation to the Trust” was the focus for a landmark case in the Court of Appeal in November 2013 concerning the future of Lewisham Hospital.

The TSA process for South London Healthcare NHS Trust

The Lewisham Hospital case concerned South London Healthcare NHS Trust (“SLHT”), which had 5 PFI schemes and was losing £1m per week.  Appointing a TSA was clearly the right thing to do.  The Secretary of State appointed Matthew Kershaw, now the Chief Executive of Brighton and Sussex University Hospitals NHS Trust, to be the TSA.  The London SHA saw this TSA process as a chance to reconfigure acute services beyond SLHT because of the prevailing view that too much of the NHS resources in London were taken up in too many smaller hospitals.  The agenda of fewer, bigger hospitals and more community services has many supporters.

Against this policy background it was not a vast surprise when Mr Kershaw came to the conclusion that SLHT’s problems could not be solved by just reconfiguring services at the hospitals run by that Trust.  He decided a wider reconfiguration was needed across the whole of South East London to make the local NHS financially and clinically sustainable, and to deliver on new clinical standards (even though these were not in fact being delivered anywhere else).

Whilst there was intense debate about the merits or otherwise of this approach, this was a legal case about powers and not about the merits of hospital reconfiguration.  The TSA was warned he had no powers under Chapter 5A to make decisions about changes outside SLHT, but he appears to have been given different legal advice.  The TSA pressed on and made recommended the Secretary of State to make a series of changes at other hospitals across the SE London area.

The main casualty of this plan (sorry for the pun) was University Hospital Lewisham which was run by a wholly different NHS Trust, Lewisham Healthcare NHS Trust.  Lewisham had virtually no PFI schemes and not yet become a Foundation Trust.  This meant it could still be required to follow directions made by the Secretary of State.

Under the TSA plan University Hospital Lewisham was due to be changed from a fully functioning acute hospital into an urgent care centre and to become an NHS elective operation factory for the whole of South East London.  The local population in Lewisham were in uproar at the suggestion that they should lose their hospital to make up for the financial mismanagement of the neighbouring trust.  A Milwall football match even changed its kick off time to allow supporters to go a “Save Lewisham Hospital” march.

The issue the TSA plan failed to address.

But the TSA plan failed to address an important question:  “What was the source of the legal power for the Secretary of State to make decisions about services provided by NHS bodies other than the Trust in special administration?”

The Secretary of State took his own legal advice on that issue and then made his decision in January 2013.  He broadly supported the TSA’s recommendations for wholesale reconfiguration across SE London, subject to relatively minor changes to bring more acute services back to Lewisham.  His decision was challenged in 2 judicial reviews which were heard at the same time.  One judicial review was commenced by the local authority, Lewisham Council and the other by the Save Lewisham Hospital Campaign.  The decision of the Secretary of State was quashed by the High Court in July 2013 and the Secretary of State’s appeal to the Court of Appeal was rejected by the Court of Appeal in November 2013.

What did the Court decide?

The courts decided that the power of the TSA to make recommendations to the Secretary of State “in relation to the Trust” was only exercisable in relation to the Trust which was in special administration.   It followed that the Secretary of State’s decision making power was equally limited.  The court said that the TSA scheme brought in by the Health Act 2009 only gave the Secretary of State decision making powers in respect of SHLT but not in respect of Lewisham Healthcare NHS Trust.  It followed that the TSA plan to reconfigure acute services across the whole of South London was ultra vires because these were not decisions made “in relation to the Trust” which was in special administration.

So the wider reconfiguration plan was abandoned and local decision making was upheld.  This meant that the Trust Board at Lewisham, working with the local NHS commissioners, were sole decision makers about services should be provided at University Hospital Lewisham.

The case focused on the law in January 2013 before many of the changes brought in by the Health and Social Care Act 2012 took effect in April 2013.  The legal landscape has, of course, changed markedly as a result of the introduction of Clinical Commissioning Groups from April 2013.  The TSA structure was markedly changed by the 2012 Act, but the powers of the TSA are still expressed to be “in relation to the Trust” which is in special administration.

The amendments to the Care Bill

The government then sought to amend the TSA regime by introducing amendments to the NHS Act 2006 through the vehicle of the Care Bill.  These have been passed in the Lords but await debate in the Commons.  Somewhat embarrassingly for the government, these amendments came to be debated and voted on before the Lewisham case was heard at the Court of Appeal.

The amendments proposed widening the scope of the TSA process as follows:

“The references in this Chapter to taking action in relation to an NHS trust include a reference to taking action, including in relation to another NHS trust or an NHS foundation trust, which is necessary for and consequential on action taken in relation to that NHS trust”

However the amendments still do not make it clear whether the TSA process gives powers to the Secretary of State to become the decision maker in respect of other NHS bodies or whether the TSA process is simply procedural, leading the Secretary of State to the position where he can exercise powers under other statutes.  It leaves open the question “what is the source of the decision making powers”.

Before Silber J the position of the government appeared to be that the TSA process gave the Secretary of State decision making powers to override the views of the Boards of a Trust or a CCG.  However the position was changed in the Court of Appeal because leading counsel for the Secretary of State specifically conceded that the TSA process created no new powers for the Secretary of State.  All it did was to provide a truncated procedure which led to the Secretary of State being able to exercise the powers that he has under other parts of the NHS Act.

In January 2013 that approach worked in law because the Secretary of State could issue directions to the PCT and Lewisham Trust under section 9 of the NHS Act.  But today the situation is very different.  The Secretary of State has no power to issue directions to CCGs.  The whole scheme of local decision making under the 2012 Act means that CCGs cannot be dictated to by either the Secretary of State or NHS England.

The direction making power is retained for NHS Trusts but most acute services are now provided by NHS Foundation Trusts.  The Secretary of State has never been able to issue directions to NHS Foundation Trusts.

There are 2 possible outcomes.  First, through the TSA regime the Secretary of State has for the first time taken direction making powers to override the authority of Boards of Foundation Trusts.  If this is the right interpretation, the Secretary of State will be able to order an FT to close down a viable A & E Department in order to direct patients to a neighbouring NHS trust.  Second, the Secretary of State does not have this power in which case the amendments to the Care Bill will not be legally effective.

The philosophy behind the 2012 Act was to create an NHS where decisions about NHS services were taken locally and not in Whitehall.  The present Secretary of State is now living with the consequences of that policy decision, and having to address how this works out when the problems in an NHS area are far wider than one locality.

The present amendments to the Care Bill seem to assume that, as part of the TSA process, the Secretary of State has powers to take over decision making for autonomous NHS bodies.  However that may well be an illusion because those powers simply do not exist.  Alternatively, with the support of the Foundation Trust Network, the Secretary of State has taken extensive new direction making powers to reconfigure services at viable Foundation Trusts by the back door.

David Lock QC was instructed by Leigh Day acted for the Save Lewisham Hospital Campaign in the High Court and the Court of Appeal.

Suicide, refusing treatment and consent in the dying process: When doctors should consult m’learned friends for the benefit of the patient.

This is a sad story about how a doctor’s misunderstanding of the law about a managed death of a patient with capacity which appears to have caused unnecessary suffering.  It may have professional consequences for everyone involved and I have therefore anonymised the details.  However it is a salutary tale about the need for doctors to understand the subtleties of the law on consent to treatment and, in difficult cases, to seek legal advice.  But it is also about the importance of doctors respecting a capacitous patient’s right to refuse treatment, even if this leads to the patient’s death. Continue reading

Should GPs aspire to run their own businesses?

It is hardly surprising that hard pressed GPs have reacted angrily to unjustified criticisms by the Secretary of State that they are to blame for faults within the NHS.  It is a gross simplification to suggest that removing responsibility for Out of Hours care from GPs is the main cause of increasing attendances at A & E.  Apart from anything else, prior to the changes in the GP contract in 2004 most GP practices used “deputising services” to cover their practice obligations out of hours.  For many practices, the only real change in 2004 was that responsibility for managing the out of hours contact moved from individual practices to the PCT. Continue reading

Do NHS commissioners invest enough in contract management?

The NHS is in the middle of the transition from a publicly funded and publicly provided health service towards a publicly funded but increasingly privately provided service. It is thus following the course adopted in social care, with the closure of local authority owned care homes and the contracting out of service provision to commercial, charity and other voluntary sector providers.

The management costs for commissioners involved in running new model successfully are very substantial.  I have previously written about the costs involved in running tender processes, and warned that the NHS has not budgeted for the management costs involved such processes.  However the disclosure that Harmoni had been failing to provide sufficient doctors to staff its Out of Hours contract in North London raises an entirely different problem. Continue reading