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Britain Plans Radical Changes to Health Care System

Jul 27, 2010

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After being touted as the ultimate role model, Britain's National Health Service, a fiscal failure, is about to be radically decentralized. The new organization, which the government says will focus on patients, will transfer the bulk of Britain's $160 billion health care budget to general practitioners. In return, regional groups of GPs will be responsible for buying hospital and medical services, medical equipment and pharmaceuticals—presumably at negotiated prices. They become, in effect, overnight medical general contractors, implementing health services to their communities.

The plan would result in thousands of layoffs among health care workers, and across the board cuts in everything from hip and cataract surgery to pediatric and maternity services, according to Britain's Sunday Telegraph. The NHS already doles out certain health services, and is likely to increase rationing on common procedures like knee replacements and orthodontic treatment.

A document signed by David Cameron and the Secretary of State for Health, Andrew Lansley states that "our massive deficit and growing debt means there are some difficult decisions to make." There are hints to some of those decisions in the language of the document, "Equity and Excellence: Liberating the NHS." We will pay drug companies according to the value of new medicines. How will that be done? Their value could be determined by high percentage efficacy or simply an imposed cost-effect ratio. Providers will be paid according to their performance. Will performance be based on outcomes? Or money saved?

The new plan is the basis of a health care bill that will have to be passed by England's legislature. Whether Parliament considers this a win for patients and doctors, or simply a cost-saving measure (or both) could make the U.S. debate over Obama's health care bill seem like a warm-up act. The plan's authors have put their cards on the table: They say they will "reduce NHS management costs by more than 45 percent over the next four years... radically de-layer the number of NHS bodies, and radically reduce the Department of Health’s own NHS functions." The goal: $30 billion in savings by 2014.

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