Public sector monopolies are a good thing right. They can’t affect private provision or innovation, and they are what they are. And in the case of the National Health Service in the UK, it’s a miracle. Thank goodness laws protect us from private companies taking over the NHS.
That’s the public service dialectic. Well, I have some worrying news for you.
Baxter’s law (also known as the Bell doctrine) is a law of economics that describes how a monopoly in a regulated industry can extend into, and dominate a non-regulated industry, named after law professor William Francis Baxter who was an antitrust law professor at Stanford University.
Here’s an example:
A new nurse-led social enterprise sets up on the South Coast of England to provide a wound dressing service. The local CCG likes the new service and signs a three-year contract. Costs go down as the service dresses wounds more innovatively, patients spend less time as an inpatient and pharmacy bills reduce.
At the end of the Contract, the CCG advertises a new Contract. The local NHS provider offers a lower price for the next tranche of the agreement. They undercut the local social enterprise by using funding and revenue from other areas of the local health monopoly. They win the new contract. Of course, they do this to protect their income in others areas of their business. Classic monopolistic and anti-competitive behaviour.
So what happened?
Did the cost of care on the South Coast go down? Did the quality go up? Or perhaps the NHS used it’s monopoly to reach into a Third Sector and kill innovation and alternative provision and protect its income. I would content that Baxter’s law applied and the NHS used its power to stifle innovation.
My concern is that many are unaware of the anti-competitive nature of this monopoly position. Next time you attend a meeting looking at NHS Contracts or as a member of the public at a Health and Wellbeing Board you might think to ask;
- What steps are we/you talking to limit the monopoly of NHS provision?
- Are we/you aware of any examples of the NHS limiting innovation or new service provision through the use of economic muscle?
The NHS and the public it serves will be better for it.
Did you notice the rise in cases in Sepsis reported by the NHS? You may know that NHS England has an action plan
Bottom line; the NHS England plan has not worked. So I guess we need Plan B.
Here are three things that NHS England could do now:
- Create a Sepsis Registry – we would then know the extent of the problem. NHS England currently doesn’t have a succinct policy for Registries (perhaps they could get round to that).
- Adopt the international standards of Sepsis treatment. Making sure the poor primary care practices are called out and addressed. (although you need a Registry to do that).
- Refer every Sepsis death to a Coroner to investigate.
That should cut the number of entirely avoidable deaths.
I like the way that John Caswell thinks… you can find more at http://johncaswell.posterous.com/ But here are some of his summer thoughts:
- The Doh Rule – "The fact that organizations don’t build real team spirit, belief and passion for the outcome cannot be underestimated. So why is it?"
- The Law of Dumb Calculations. "I don’t have the time to go through all this thinking again" – When we all know that the price of avoiding reasoning, rigor and critical decision making is a rounding error compared to the accumulative cost of the graveyard of failed businesses.What’s up with that?
- Clear Confusion. "Meaning defies clarity. In other words it might not."
The Context Rule – "Solving the wrong problem well is simple and requires us only to ignore context. Try it. Then Hide."
- Tough & Tougher – "A Trilemma better describes hard choices in the 21st Century. It’s never either – or. It’s always either – or – and – and."
- The Principle of Avoiding Complexity – "People who regard the act of thinking hard as complex and time consuming should try not doing so. See how complex and time consuming that is. Excellent."
- The Law of Definition – "In defining anything – ever – be careful to listen to the lack of understanding on the face of the recipient. Then redefine it with them."
When I read this stuff I know I must just try harder
John Coulthard, director of healthcare at Microsoft UK, reflects on the challenges facing the health service in the year ahead. He argues the coming year will be dominated by the need to make extremely demanding efficiency savings, while delivering on the personalisation agenda set out by Lord Darzi.
The main theme of the coming year will be the recession, and for everybody involved in healthcare the challenge will be how to do more with less. The years of plenty are over, but delivery of the huge policy agenda set out by Lord Ara Darzi at the end of his Next Stage Review has only just begun.