Admit NHS market, ministers told

Ministers have introduced a series of reforms

The government should come clean and admit it is creating a market in the NHS, a group of experts says.

The King's Fund working group of NHS managers, businessmen and voluntary sector officials said there needed to be greater clarity over the way ahead.

The group also urged ministers not to place limits on the private sector.

Ministers have denied that key reforms - such as patient choice and a new system of payment which encourages competition - are creating a market.

A supply-side market is being created in health care out of a powerful mix of tariffs, incentives and new providers Greg Parston, chairman of working group

In a key speech to the London School of Economics in December, Health Secretary Patricia Hewitt said she did not believe the government was turning the NHS into a market.

She said: "It would be a pretty odd kind of market where the user cannot pay and the providers cannot compete on price."

Many believe the government is worried about being accused of returning to the infamous internal NHS market of the Tory years which was heavily criticised at the time.

But the working group said the NHS was heading towards a market-driven way of working.

Patients now have choice of where they can have operations and hospitals are paid per patient treated under a system called payment by results.

The government has also been encouraging the private sector to carry out non-emergency NHS surgery, as well as bidding for contracts to run GP services.

Temptation

The working group said greater clarity was needed on the direction in which the health service was heading.

It said ministers should avoid the temptation to impose central control.

It made a number of recommendations to ensure the NHS market was successful, including refraining from putting limits on private sector provision.

It said the amount of care coming from the NHS, private and voluntary sectors should "emerge as the market develops rather than being artificially determined".

But it added it was essential in that case for there to be a level playing field to allow the NHS to compete with independent providers.

Group chairman Greg Parston said the government risked missing out on the benefits of a market-based NHS if it was not clear about its objective.

"A supply-side market is being created in healthcare out of a powerful mix of tariffs, incentives and new providers.

"This offers tremendous opportunities but it also carries great risks.

"A poorly operating market could damage widely acknowledged NHS strengths and ultimately undermine patient care."

King's Fund chief executive Niall Dickson said: "The move towards the introduction of a supplier market has been achieved with surprisingly little serious discussion and there is still some uncertainty about where it is all heading."

A Department of Health spokeswoman said the government was committed to introducing more choice and faster access, but once again stressed this was not the equivalent to a market.

She also denied there was a lack of clarity. "In January, we set out The NHS in England: the operating framework for 2006/7. This sets out clear priorities and expectations for progress on reform and improving services to patients."