UK Coalition Government Unveils Radical NHS Plans

The UK's coalition government has set out plans to radically reform the National Health Service (NHS) in England by abolishing Strategic Health Authorities and Primary Care Trusts (PCTs), and by introducing a value-based pricing system.

The cost-cutting proposals, revealed in a White Paper by Health Secretary Andrew Lansley, recommend moving responsibility for the NHS budget for mental health, hospital and community services from PCTs to primary care doctors assembled in consortia. The move will see England's 152 PCTs - which currently manage about 80% of the NHS's £105 million budget - phased out by 2013, potentially cutting up to 30,000 management positions. A new, independent commissioning board will be put in place to monitor the allocation of NHS resources.

The White Paper also proposes setting drug prices according to the value that medicines provide, removing the restrictions to access currently imposed by the cost-effectiveness thresholds set by the drug spend watchdog, NICE. These measures, however, will not be introduced before 2014, and NICE's position is not itself under threat; indeed, the body's statutory role will be strengthened and its remit extended to include social care.

The NHS proposals have received some mixed reactions. David Furness of the Social Market Foundation think tank said "giving control of NHS funds to GPs is like asking your waiter to manage a restaurant. They might know what you want to eat but they won't necessarily be any good at ordering stock..." Opposition Party Health Secretary Andy Burnham has called the plans a "U-turn of epic proportions" that "rips up" the former coalition agreement on the NHS.

Industry, however, has been largely supportive. The Association of the British Pharmaceutical Industry (ABPI) said it was "pleased that the White Paper signals a move towards greater doctor and patient influence over clinical decisions." ABPI also agreed that the expansion of NICE's remit to promote clinical best practice "is a higher priority for the future of the NHS than the overly narrow cost effectiveness calculations on new medicines it currently conducts."