"The NHS will last as long as there are folk left with the faith to fight for it"
Aneurin Bevan

Friday, 2 September 2011

Personal Healthcare Budgets

One of the best features of the NHS is that you know that whatever unforeseen healthcare issue you have, you will always get treatment according to clinical need. Anyone who waters down this basic principle of the NHS does not deserve to hold public office.

Enter the concept of personal budgets for healthcare. I will write more about this subject but here are some initial thoughts. The first point to make is that all the major political parties are in favour of personal budgets. This would imply that the majority of people are in favour of them, and that there is a universal demand for them. But stop anyone in the street and ask them about NHS personal budget and you'll find that they either have not heard about them, or they are against them. If you get a positive response for personal budget, it will be usually followed up with the hope that it will result in more money spent on them. The sad truth is that there is no more money, and that in the future the money spent on healthcare will decrease, not increase.

What are personal budgets? The idea is that through a personal budget patients will be offered more choice and control over their care. However, at the moment the policy makers are very careful to say that they will be offered only be patients with long term conditions. Policy makers are also careful to say that they will be only offered to patients with "stable and predictable conditions". The combination of these two restrict their application to a limited number of perfect patients. Finally, policy makers are extremely careful to say that no one will ever be denied treatment as a result of having a personal budget. Life is never perfect, but let us assume the best case for patients.

If no one will be denied care, this implies that the situation we have at the moment - where care is according to need - will be the baseline, that is, the minimum spend. Politicians are acutely aware that they must not be seen to be introducing rationing. It would be political suicide for a politician to be seen to be introducing any policy that require patients to pay for top-up for NHS care. This means that when personal budgets are introduced they must be more than what the patient would otherwise receive through their existing NHS care.

Patients will not be simply handed a pot of cash to spend however they like. Instead, they will be handed a limited list of approved treatments (or providers) or patients will be asked to have a treatment or provider approved before they will be able to spend the money from their budget. This requires the work of an administrator, advisor or advocate and it will be in addition to anny administrators currently used. Further, since this will be devolved down to the patient level, rather than across a large number of patients, it will not benefit from economies of scale. The administrative costs of personal budgets will be more than not having personal budgets.

To make the budget more personal, a patient must be given access to the budget. Whatever access the patient is given, it is unlikely to be actual cash, otherwise the patient would be able to spend the budget on something other than healthcare (for example, heating bills). Instead, the personal budget is likely to be in some other form of currency: for example vouchers. The conversion of these other currencies will have a cost.

When you add all of this together, personal budgets will cost more for the same treatment than not having personal budgets. The only way that personal budgets can be made popular for those that will receive them, is if they will result in more spent on those patients. However, there is a fixed overall healthcare budget so if more money is spent on patients with personal healthcare budgets, this means spending less on those without them. I object to any policy that results in taking money from one patient to give to another if there is no clinical benefit for both patients.

Further, I dislike quoting Liam Bryne but "I'm afraid to tell you there's no money left" is apposite. Any policy, in the foreseeable future, that involves spending more will be rejected by the Treasury, so therefore every government policy must result in spending less. Since personal budgets involve spending more on administration, they mean spending less on healthcare, and any temporary rise in spending on healthcare designed to make personal budgets popular will ultimately result in bigger cuts in the future.

I can never support personal budgets.


  1. Richard, did you see the NHS Confed report on personal health (as opposed to social care) budgets in MH: http://www.nhsconfed.org/Publications/reports/Pages/Personal-health-budgets.aspx. Must have given the DH collywobbles, as there's no way of getting around the fact that neither services nor service users want the doggone things.
    Obviously it's from the Confed so is still q. gung-ho,saying that service users need reassuring/cajoling until they 'get it' but no matter how it's presented these are changes that are unwanted.

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