Recommendations for the National Health Service - Essay Example

? Strategic analysis of the National Health Service: Recommendations for improvement BY YOU YOUR SCHOOL INFO HERE HERE EXECUTIVE SUMMARY The NHShas many problems. These problems include too many expenses being paid, too much demand that is over the supply levels in hospitals, poor governance of Trusts, and an aging population that always uses NHS services that are very costly to the National Health Service. The high amount of issues with the NHS needs immediate government attention. It is recommended that the government launch a public relations campaign to change demand levels for hospitals, set up an auditing team sponsored by government to fix non-performing Trusts, create laws that bring more drug substitutes into the market, set up mental health screening for at risk older patients with psychological issues, and removing laws that allow terminated Trust governance to continue to receive financial rewards. Only these recommendations can better put the NHS in a position where it is not always losing financial resources and providing poor quality of care. TABLE OF CONTENTS 1.0 Introduction.......................................................................................................... .. 2.0 Principle stakeholder concerns............................................................................... 3.0 What are the problems?........................................................................................... 4.0 SWOT Analysis of NHS......................................................................................... 5.0 Recommendations for the NHS............................................................................... 6.0 Conclusion................................................................................................................ References 1.0 Introduction The National Health Service (NHS) was founded in 1948. Its purpose was to set up the systems needed to provide health care for all British citizens. Through the years the NHS has started to redesign the operating structure of the NHS to make sure the system provided quality care based on need and not the ability of a citizen to make payment. The estimated yearly cost of operating the NHS and providing health care is approximately ?127 billion. This cost is spread between the four areas of the NHS including England, Ireland, Wales and Scotland. Nearly 100 percent of all funding for the NHS comes from taxation revenues provided to the government. In 1949, spending for the NHS was only two percent of GDP (Dixon 2011). Today rising costs in areas of supply chain, inflation rates and NHS employee salaries have pushed spending to seven percent of GDP. This is many important because government must support many other public programs. Going over budget in the government limits the amount of additional funding that is ready to the NHS caregivers. Many trusts that are now part of the National Health Service are operating at a financial loss and there is simply no funding ready to help in this situation. This report looks at the strategic problems facing the NHS. Based on findings several recommendations for improving the NHS are provided. 2.0 Principle stakeholder concerns The principle stakeholders have much to lose if the NHS cannot operate properly or get government funding. Table 1 shows the principle stakeholders in the National Health Service. Table 1: Principle stakeholders of the NHS NHS Trusts PM David Cameron Parliament Patients Nurses Physicians Medical Universities Hospitals Citizens in Poverty One of the main problems with the NHS today is that citizens are not willing to pay higher taxes to better fund the system. Still citizens want high quality care, available choice, and always free service delivery. This gives government and other principle stakeholders responsible for providing care a very big concern: how will the NHS stay properly funded and still meet citizen demands? David Cameron has demanded that the NHS seek opportunities to cut the total budget by 20 percent, but none of the government stakeholders seem to understand what areas could benefit from reductions. The NHS is no longer a single entity, but has changed to include many different trusts in the hopes of giving patients much more choice. These trusts are now deemed markets as a means of promoting better competition. This seems to have been a very big mistake because now these independent trusts continue to go over the set budget given to them by the government. 3.0 What are the problems? There is a fast aging population of citizens in the United Kingdom today that put much strain on the NHS and its resources. Apps (2013) states that many older citizens in the UK cannot cope living independently which forces hospitals to provide extended care. The article tells about one older patient, Tom, that needed NHS assistance with an illness, but after recovery had become too frail to manage living at home on his own. What made this problem so difficult was that the patient in the article had psychological problems about loneliness of living without a social network (Apps 2013). This drove the patient to seek alcohol for an escape which continues to put him back into the hospital to get care on the taxpayer payments. Providing blended care for many patients like Tom is very expensive and it is not accounted for in the NHS budget. What this speaks of is that the NHS is not structured properly to understand the total costs of providing physical and mental health care to aging citizens. Russell (2013) says that there is also a problem with people over-using acute care hospitals for treatment. It is very expensive for the NHS when care is provided in a hospital instead of local community clinics. Michael Porter (1985) describes his Five Forces Model that shows the different risks that occur in the external industry environment. One of these forces is supplier power. The NHS has set-up the care systems so that most of all health services are provided by concentrated suppliers. According to Porter (1985) this gives suppliers the ability to raise prices since there is not competitive threat that gives customers choice. Because the NHS did not think about the rising costs of hospital care when setting up the NHS in the 1940s and 1950s, there was not enough diversity that gave patients the chance to go to local community care centres for problems that do not need long-term hospitalisation. What this has done is given hospitals, as suppliers, much power to leverage pricing in order to break even or achieve financial gains. Now, hospitals as controlling supplier agents have driven the price of hospital care so high and most citizens in society think first to go to the hospital even for non-acute care. The social attitudes of citizens about how to get proper care along with very high supplier power in hospitals bring many financial risks to the NHS. All of the citizen beliefs that hospitals are where they should go to get quality care drive up demand for hospitals. This is supported by Campbell (2013) that states the demand for hospital care is so very high that patients are actually being forced to sleep in hospital corridors because there are simply no beds available for care. At the same time there is also such a shortage of qualified caregivers in the NHS that nurses are forced to work under very demanding conditions. This makes nurses unable to give proper quality care which not only angers patient stakeholders, but also the overworked nursing staff as well. PR Web (2013) reports that bed sores are a major problem in hospitals. This is a type of negligence that could be prevented by turning immobile patients frequently to prevent what is called pressure ulcers from happening. High demand, overworked nursing staff, and poor management are causing a blended problem with setting up a total quality management system. All of the negative press about the incompetency of the NHS is likely what is making citizens refuse to pay higher taxes because the quality of care is perceived to be quite dreadful. Williams (2012) adds more proof that there is a management and quality problem in the NHS. Pressure from stakeholders has forced the NHS Commissioning Board to admit that there is also a diversity problem in recruitment of nursing and physician staff. Armstrong (2003) says that organisations with diverse employees creates a culture that is better able to come up with innovations and see opportunities to problem solve. NHS hospitals are much centralised which means that decision-making is made at the highest tiers of authority. Staff is not given opportunities in this model to share in this process which limits the hospital in areas of human capital. This is a weakness in the NHS system staffing and management models. There are no guarantees that hospital executives have the competence to make quality decisions that will be of benefit to the hospital and patients. Having all parts of the hospital centralised when diversity of care is required is not a good decision in today’s health care environment. Yet another problem involves the NHS Trusts. When trusts that are funded by taxpayer payments go over their demanded budget, it is policy to remove their governance boards. Removing poor management that cannot control costs properly makes fiscal and leadership sense. However this is a very expensive activity to the NHS. Laurance (2012) states that one out of every five Trusts in the UK are in terrible financial condition. This means that it will be more common in the coming years for the NHS to start removal of incompetent governance teams. This seems like a good strategy to bring better management into the Trusts, but Moore (2008) shows that it is very costly for the NHS. One chief executive who was removed for failing to keep budget was paid ?75,000 even though he had a role in an infection control disgrace. Yet another removed governance member was allowed to receive six months’ salary when let go for poor leadership (Moore 2008). All of the legal systems that support the NHS make it damaging financially even to bring more quality leaders into the trusts. All of the protections that are given to poor governance even when they are failed to meet performance goals are a major risk to the NHS. The NHS also gives current patients (inpatient care) with Prescription Prepayment Certificates (PPC) that help NHS patients with their prescription costs. These PPCs give a one-time savings, a tri-month savings and a yearly savings. The 12 month certificate as one example is only ?104 and it allows patients to get up to 14 medications every week for an entire year no matter their costs on the market (nhs.uk 2013). Why is this important? Thompson, Gamble and Strickland (2005) describe more work by Michael Porter on the Five Forces model. One force is the threat of substitutes. The less available substitutes on the market create barriers to price rising by the main product supplier (Porter 1985). The NHS therefore creates the problems itself. By letting patients in the NHS get high quality drugs for only a small price with the PPC, it limits the motivation of generic drug makers to flood the market with generic products. Why should the maker flood the market with generics when the government will pay top prices for better quality drugs? The NHS must then pay the drug maker high prices (for some consumers even 14 prescriptions are covered!). Since not all drugs have generic versions it lets the drug maker decide any price it desires and the government must pay the bill on promises with the Prescription Prepayment Certificates. The centralised structure of the NHS hospital and trusts makes even more problems even over staffing issues. The Nicholson Challenge was for members involved in the NHS to find ?20 billion in redundant or inefficient processes in the system (Ball 2009). It was already said that one in five Trusts are heading near bankruptcy and many governance members are being removed for not being efficient or competent. Using the Force Field Analysis Model helps to understand this problem. Finding this ?20bn means change practices must be set up in the Trusts. The force for change is the goal of helping meet budget with the NHS and also pressure from the Prime Minister and other government members. Forces against this change include nurses and doctors that are being overworked and have no motivation. Buchanan and Huczynski (2010) says that when situations change, the entire organisational structure must change to be adaptable. The Nicholson Challenge does not offer that there should be internal restructure, only that people look for chances to lessen costs. This is not what Buchanan and Huczynski (2010) are saying but these authors want a complete new design that makes it possible to gain good change results. The Nicholson Challenge is therefore just asking Trust staff and executives to be aware of their expenses to see where some can be eliminated. No real results will happen without structural improvements and redevelopment. 4.0 SWOT Analysis of NHS Strengths Awareness of financial difficulties The Nicholson Challenge for efficiency savings searches Home nursing for aging population Weaknesses Poor governance and management Understanding where costs are coming from Supply unequal to demand Opportunities Raise taxes for more funding Hedging (investment) to gain capital Change recruitment to diversity models Threats Aging population needing more intense care Poor publicity about NHS competence Economy making more poor needing NHS help 5.0 Recommendations for the NHS Based on all of the findings there are many recommendations that would help to improve the organisation and its many financial problems. The Prime Minister David Cameron and members of Parliament should be working on reforms to the private insurance industry. This is because of the lack of substitute drug products on the market today. As shown by Michael Porter (1985) when there are no substitutes it lets the supplier set up prices that can be raised at their whim. This helps the supplier gain profitability. Government should be setting up legal incentives for private insurance companies for those that do not need the NHS for health care so that it makes it favourable to put generic substitute drugs for patients. Since the NHS PPCs pay for high cost drugs at a very small price for the NHS patients, they do not have to choose generic drugs even if they are available. By changing private insurances to offer lower co-payments to the non-NHS patient it would give the incentive to choose lesser priced drugs. This would give the makers more incentive too for release of new generic drugs that compete with high priced drugs that currently cost the NHS many resources. This would help to control the prices of high priced drugs that would give the NHS much more cost savings. Older patients that seek care should be evaluated for their mental health status. By setting legal language that makes this necessary for patients over 75 years of age, it would give better mental health care. The research showed that many older patients are turning to alcohol when living alone that only makes their physical health even worse. This puts too much financial strain on the NHS and also burdens hospitals with too high of demand. Better early mental health screening could help the older person adjust to their problems so that they can live independently without a lot of troubles. Aging patients that are known to be at risk for poor coping or not being able to live alone without hurting themselves could get the psychological help needed if government built new legal systems in this direction. This could have major cost savings on the NHS and lessen the impact of limited beds in hospitals. The government should also launch a new public relations campaign to change social attitudes. It was discovered that many people turn to hospitals first even when they do not have acute health problems and acute care needs. A campaign that shows the benefits of using community clinics and other community care options would help to lessen the demand on hospital staff. Since hospitals are very expensive to the patient, it would also have many cost savings benefits for the NHS. The goal of the campaign would be to change long running social attitudes about why hospitals can provide better quality of care. Over time, the public relations (marketing) campaign could show how community care can also be valuable and positive. These types of campaigns have been known to change social behaviours when the messages are regular and uniform. Government should also begin changing the laws that support poor governance. Too many Trusts are not meeting their demanded budgets which is a direct result of poor leadership. These governance members are getting huge financial payoffs when this occurs or being allowed to continue to get their high salaries for many months even though they were not competent as governors. There should be laws that protect the NHS from having to make these payments when it has been proven that leadership is to blame for not meeting budget targets. Since one in five Trusts are heading near bankruptcy status, this means that there will be more governance removing in the near future that could cost the NHS many financial resources. Only government can change these laws and make sure that governance is held accountable and also lose all of their benefits after being terminated. Too many governance members are causing harm to taxpayers by receiving rewards long after they have been let go that is unfair to society and also brings much negative publicity too. There should also be a new auditing group that looks at the structure of Trusts and helps in making structural changes when they are failing. This group would look at the Trusts and their organisational hierarchy and then report to government representatives about improvements needed. This would give the government a much more intense look into the Trust systems to find out where the real problems are. If there is corruption or poor management, the government can legally demand restructuring in order to fix the problem or set targets by which these restructures must be completed based on government and auditing team advices. The Prime Minister can set up a representative of government to serve as the governance leader in this effort. This representative would control all administrative actions of the auditing team and also monitor their competence and obeying reporting compliances. The government needs more control over how the Trusts are managed and structured if there are to be any meaningful changes that help the NHS in the long-term. 6.0 Conclusion As shown, the NHS has many problems that need government help in order to correct the issues. Poor Trust leadership, rising prices in hospitals and prescriptions, centralised hospital structures limiting innovation and shared decision-making, and the aging population are only part of the problems with the NHS today. If the recommendations provided are followed it will help the NHS to be more sustainable over the long-term. The recommendations are all within the power of government to fix and should be considered as fast as possible to improve the NHS. The main concern with the NHS is cost issues in a system that is no longer sustainable. Most of the recommendations for improving the National Health Service have positive consequences related to financial woes and should be made priority with the government to make any critical changes. If the government considers all recommendations the NHS will likely save billions of Pounds each year that can be put to better quality of care and available beds in NHS serving hospitals. References Apps, A. (2013). Society’s problems risk overwhelming the NHS, The Guardian. [online] Available at: http://www.guardian.co.uk/healthcare-network/2013/jan/14/society-problems-overwhelming-nhs (accessed 11 April 2013). Armstrong, M. (2003). A handbook of human resource management practice, 9th edn. London: Kogan Page. Ball, J. (2009). NHS chief tells Trusts to make ?20bn savings, The Telegraph. [online] Available at: http://en.wikipedia.org/wiki/Nicholson_challenge (accessed 11 April 2013). Buchanan, D.A. and Huczynski, A.A. (2010). Organisational Behaviour, 7th edn. Essex: Pearson. Campbell, D. (2013). Shortage of hospital beds and staff ‘forcing patients to sleep in corridors’, The Guardian. [online] Available at: http://www.guardian.co.uk/society/2013/apr/22/shortage-beds-staff-sleeping-corridors (accessed 22 April 2013). Dixon, J. (2011). The UK National Health Service – recent reforms and prospects for change, Nuffield Trust. [online] Available at: http://www.cuhk.edu.hk/hkiaps/PPT/DIXON%20Jennifer_0302.pdf (accessed 10 April 2013). Laurance, J. (2012). One NHS Trust in five is in bad financial trouble – and Department of Health is failing to plan for bankruptcies, The Independent. [online] Available at: http://www.independent.co.uk/life-style/health-and-families/health-news/one-nhs-trust-in-five-is-in-bad-financial-trouble--and-department-of-health-is-failing-to-plan-for-bankruptcies-8231603.html (accessed 14 April 2013). Moore, A. (2008). Anger over C difficile pay-off, Health Service Journal. [online] Available at: http://www.hsj.co.uk/anger-over-c-difficile-pay-off/538529.article (accessed 11 April 2013). Nhs.uk. (2013). Get help with prescription costs. [online] Available at: http://www.nhs.uk/NHSEngland/Healthcosts/Pages/Prescriptioncosts.aspx (accessed 11 April 2013). Porter, M. (1985). Competitive advantage: creating and sustaining superior performance. London: Collier Macmillan. PR Web. (2013). Bed sores still a big problem for some NHS hospitals says Asons Solicitors. [online] Available at: http://news.yahoo.com/bed-sores-still-big-problem-nhs-hospitals-says-130227159.html (accessed 11 April 2013). References Thompson, A., Gamble, J.E. and Strickland, A. (2005). Strategy: winning in the marketplace, 2nd edn. New York: McGraw-Hill. Williams, D. (2012). NHS Commissioning Board admits diversity recruitment problem, Health Service Journal. [online] Available at: http://www.hsj.co.uk/home/commissioning/nhs-commissioning-board-admits-recruitment-diversity-problem/5049663.article (accessed 11 April 2013). Read More