Seven ways to cure the ills of the NHS with commentary from Cambridge Judge Business School academic

We discuss ideas to give our hospitals a shot in the arm, with Prof Stefan Scholtes, an expert in health management.

The challenges facing the National Health Service can seem insurmountable. With hospitals at capacity and recording their busiest ever days, A&E targets being missed, warnings that two-thirds of our health trusts are in deficit, concerns over so-called ‘bed-blocking’ and a bitter dispute over the junior doctors’ contract, there’s no shortage of problems to solve.

1 Simplify our general hospitals

Hospitals today are too complex – making them unwieldy and inefficient, says Prof Stefan Scholtes, of the Centre for Health Leadership and Enterprise (CCHLE) at Cambridge Judge Business School.

He believes it is time for some routine procedures to be passed over to specialised centres, or even GP practices.

“Hospitals are way too complicated. They can’t be managed,” Prof Scholtes told the Cambridge Independent.

With medical advances greatly increasing the diversity of procedures, hospitals have taken on greater organisational complexity, he argues. There is a need to counteract this by handing simple, well-understood routine procedures to others.

“We can’t have a hospital that sucks in all the innovations but doesn’t open the valve on the simple stuff, otherwise we have a bottleneck that becomes unmanageable,” said Prof Scholtes, the Dennis Gillings professor of health management and academic director of the CCHLE. “Hospitals operate largely as they did 60 to 70 years ago. They are the point of last resort and they take everyone in.

“I spent a sabbatical at Addenbrooke’s six or seven years ago and the CEO at the time, Gareth Goodier, asked me what I made of it. I said ‘Gareth, I thought you were running a company but actually you are running a village. You’re not a CEO, you’re a mayor. There are 600 consultants who have set up shop here and run their business. It’s very difficult in that context to run a tight ship.

“It works if you have enough money to plaster over things but if you want to streamline things, this is very difficult to do.

“So how do you make that simpler? I think the only way is to take some stuff out. Over the last 50 years so much technological change has occurred that was put into the hospital but hardly ever was a valve opened, where someone said: ‘What is it that we don’t need to do in a hospital?’

“We have to get a flow going. Why don’t hospitals pass routine, well-understood services to large GP practices or specialised centres?”

There is tension between an NHS hospital’s role as provider of both emergency and routine care.

Prof Scholtes has examined NHS and German hospitals for two recent studies that looked at what happens if routine elective procedures are reduced in hospitals.

The studies indicated that the complex, emergency services that remained in hospitals recorded improved quality and cost-efficiency – as did the routine elective services sent elsewhere.

“What was interesting was that high service volume does actually make services more efficient and effective – but only for routine care,” says Scholtes. “If the patient’s case is complex, having a ‘factory’ is not the right approach. This is, again, an argument for separation.”

Creating specialist centres that focus on conducting certain well-established procedures at high volumes could mean patients having to travel further but they would be treated more quickly.

Prof Scholtes and Dr Feryal Erhun, reader in operations management at the Judge, have identified three reasons why this approach isn’t being taken. Routine services are profitable for hospitals and subsidise loss-making emergency and complex elective services. The demand for specialist emergency and complex services is also volatile, meaning doctors’ clinical productivity could suffer. Then there is the simple factor of professional inertia.

Separating routine, elective procedures from complex and emergency services will require careful analysis and a degree of creativity, they concluded. And it’s particularly challenging at large tertiary hospitals like Addenbrooke’s.

“If you go to ask Addenbrooke’s and say break it apart, they’ll say it’s very difficult to do,” said Prof Scholtes, acknowledging that the doctors required for emergency orthopaedic care, for example, are also those skilled in routine orthopaedic surgery. So where do you start at a large tertiary hospital?

“You have to break it organisationally apart,” he suggested. “Show the accounts for the district general hospital, for the tertiary service and for the routine elective surgery separately. At the moment it’s all one wash and so it’s difficult to identify what goes wrong where. Maybe you’d start with shadow accounts so it gives you some information on where things go wrong.”

2 Solve the social care crisis

It’s well understood that many patients don’t need to be in hospital at all. If better social care arrangements were in place to help care for patients at home or in respite care, beds could be freed up in our hospitals.

Cambridge’s Labour MP Daniel Zeichner, speaking in the Commons last October, said when he visited Addenbrooke’s, he found more than 100 patients who didn’t need to be there.

Pointing out that there had been a 12 per cent rise in the number of people over 85 coming into A&E, he said: “Addenbrooke’s is not the place to warehouse vulnerable elderly patients. Our elderly parents and grandparents deserve proper social care and wards need to be free for people who are ill.”

In the same month, the hospital revealed one elderly woman had been in hospital for an astonishing 189 days as she waited for a nursing home bed.

More live-in carers, domiciliary care rounds and nursing home beds are needed to resolve the problem. The NHS is like a blocked pipe. At one end, patients are flowing in to A&E in record numbers. But at the other, a lack of beds caused by social care challenges mean patients cannot flow out.

With council budgets under strain, however, funding social care is a huge challenge.

What if social care funding was taken back into central control, rather than being handed to local authorities? Would the communication between these parts of our care system improve and these ‘delayed transfers of care’ reduce?

The Barker Commission on the future of health and social care thinks so. In 2014, it advised the creation of a “single, ring-fenced budget for health and social care, with a single commissioner” and advised changing National Insurance contributions to raise £5billion for social care funding.

Prof Scholtes warned: “It’s appealing at first sight. But the flip side of integration is complexity. If you integrate just by putting budgets together and accountability under the same head you earn unmanageability. So integration is a good idea but it has to be done smartly.

“On the political side, social care is going to become more and more costly, as health care is. The government has made the promise to protect the NHS budget, but not the councils’, so by artificially removing social care from the NHS they can tighten the screws.

“We have a problem with rehab – and that is part of the NHS. We have Papworth Hospital that is going to be vacate a really good, viable healthcare site and it’s likely to become housing. That’s such a missed opportunity because it’s a great rehab site. If you had a way of getting elderly patients out of Addenbrooke’s into a cheaper rehab bed you have an intermediate solution that would allow Addenbrooke’s a flow.”

3. Spend more cash

More money may not be the only answer but it would surely help. The Government is spending about £143bn on the NHS this year.

In 2013, health spending as a percentage of the UK’s gross domestic product (GDP) was 8.5 per cent compared to the 10.1 per cent average of the rest of the original members of the EU. The UK was 13th out of the 15 founder members in the funding table. The King’s Fund points out that closing the gap by 2020-21 would require an additional 30 per cent in funding, or £43bn.

“More money is not a panacea but it’s absolutely necessary. We are under-funded. I don’t think anyone would disagree with that,” said Prof Scholtes.

“The Government has to cough up money. There is no short-term solution other than more cash. The question is how much more and for long.”

4 Raise more money

Speaking on Question Time in February, former Tory MP Ann Widdecombe called for a grown-up discussion about NHS funding ¬– something, she said, that she had been calling for since the late 1990s.

One option is the use of more private money in the NHS. That’s hotly contentious, of course, with management of Hinchingbrooke Hospital in Huntingdon by Circle aborted last spring after only four years. Budget cuts and the level of demand had made the job unsustainable, according to Circle boss Steve Melton.

But there are ways to bring private money into public hospitals without handing over management control.

Beside Addenbrooke’s, a 90-bed private hospital, a 198-bed hotel, a 900-delegate conference centre and a post-graduate medical education centre and supporting social accommodation are being built on the Cambridge Biomedical Campus by John Laing. Addenbrooke’s will receive an annual income and a share of the profits from the £120million development, known as The Forum, which will help fund its services. The project is not without its challenges, though, with Ramsay Healthcare pulling out of the private hospital plan last October.

“There is not much private practice done in hospitals here although the cap that was in place has now gone so there are opportunities. There are big questions of a two-class system that we have to be wary about. But when you look at Germany a large number of hospitals, even big university hospitals, are run privately – some for profit, some for charity – so there are some models out there that are reasonably successful.”

“In Germany. It’s not like there were no failures. Looking at one particular case in Hinchingbrooke, which was very difficult for anyone to take on, and extrapolating it is dangerous. On the other hand, is there a political appetite? I don’t see it.”

Another option is asking those who can afford it to help pay for their care.

“We have to find more money for health care and think about some form of co-payment that opens another funding source,” said Prof Scholtes. “There are lots of rich pay around in the UK and I can’t see why they can’t co-pay.”

Here are some other ideas to raise funds:

• Charge patients for food: It represents less than 0.5 per cent of NHS spending, but food still costs the service tens of millions every year. Most patients could afford to buy meals – after all, they’d be paying for food if they were at home – and many would welcome a rise in quality. An unpopular move, perhaps, but wouldn’t you rather raise clinical results than have a free meal?

“Absolutely right,” said Prof Scholtes. “There is a standard payment you would have at home and that should be the minimum copayment.”

• Ask for donations as patients leave: Given that most NHS patients are full of praise for the dedication of staff and care they receive, there’s a fair chance many would drop some cash in a donation bowl on their way out. Hospitals already have charities – like Addenbrooke’s Charitable Trust – that send letters out but why not get patients to cough up before they’ve even got to the car park?

• Charge drunken patients for their care: Friday night drinkers who land themselves in A&E when they topple over are given the same care and attention as anyone else. But when they sober up, should they be asked to contribute to their self-inflicted injury? A slippery slope, many might say, and how do you prove what’s self-inflicted? One to ponder over a stiff G&T.

“All of these need to be thought about,” said Prof Scholtes “We should be careful not to have ideological blinkers. We have to open this up. Is this going to be a slippery slope? Absolutely, so we have to be very careful. But I can’t see how we can keep the NHS going over the next decade or so without some other source of funding than taxation unless we’re open to spending a much bigger proportion of our taxes.”

5 Smart integration.

Knowledge is power, they say, and our health systems could be better connected.

“The basis of integration is information sharing,” said Prof Scholtes. “Where you have well integrated healthcare systems like Kaiserpermanente in the US or places in Europe, like Belgium or Germany, they’ll tell you that a) it’s a long journey and b) you start with integrated information. You have to understand where costs are incurred and full information for the patient line.

“Addenbrooke’s EPIC system has great information but when a patient leaves, you have no information – unless you integrate with GP systems.

“I would start at a local level – if we did this at Cambridge region, that would be interesting.”

6 Scrap the existing A&E targets

Hospitals are tasked with seeing 95 per cent of patients within four hours and, as we’ve seen in the last week, they are failing to hit the target. Hinchingbrooke has just recorded one of the lowest results in the country – just 72 per cent. But while targets are generally imposed to improve outcomes, they can have unforeseen and unfortunate consequences.

In hospitals, there is evidence that the four-hour target doesn’t always lead to the best clinical decision.

“I did some research on an emergency department’s admission behaviour when it becomes crowded. You would want to see people become more careful with admissions so that expensive hospital beds are reserved for the most seriously ill patients.

“But what happens is patients approach the four-hour target and decisions have to be made. So you might only have a window of an hour for a patient for whom you actually need two and a half hours to assess them. So you make the decision with less information. What are you going to do? Discharge them home and be personally liable if it was wrong? Or are you going to send them to the ward? If you look at the data it’s the latter.

“The target leads to what I call the ‘bullwhip effect’ – a small surge in the emergency department leads to a bigger surge in the ward when it should be the opposite. I think we should publicise waiting times but I’m not convinced we should have a target – and certainly not the way the target is set up now. It’s got to be responsive.”

7 Education

A slow-burner this but educating everyone to take better care of themselves – to exercise regularly, to eat healthily, not to smoke, to reduce or cut out alcohol and so on – will lessen the demand on hospitals. Obvious, really. But in England, an astonishing 62 per cent of adults are classed as being overweight or obese, increasing their chances to type 2 diabetes, cancer, high blood pressure, stroke, heart disease.

And the pattern can be set early.

“Overweight children are more likely to become overweight adults,” said Susan Jebb, professor of diet and population health at the University of Oxford.

So doing more to challenge the food industry to produce healthy foods and educating consumers to be more careful about their lifestyle are moves surely as vital as any organisational change in our hospitals.

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