Is doctors' self interest undermining the National Health Service

Abstract

Recent newspaper headlines have suggested that doctors' pay is responsible for the financial crisis in the NHS. Alan Maynard argues that financial and other self interest is endangering the service, but Laurence Buckman believes the renumeration is justified

Self interest is an integral part of every human's programming. The challenge is not to eradicate what is impossible to remove but how to channel these powerful forces to serve the individual and the public good. Economists regard self interest as the engine of economic development. As epitomised in the writing of the economics Nobel laureate Milton Friedman,¹ the challenge for society is how to use self interest as an engine not only for economic development but as the means to maximise individual freedom in decentralised, competitive markets.

For Friedman and his 18th century predecessor Adam Smith,² the “invisible hand” of self interest and the individual pursuit of improvement in a free market with minimal government regulation would ensure that society's scarce resources were used efficiently and economic growth maximised. This, in theory, makes self interest good.

This simplistic view ignores the realities of most markets, and the healthcare market in particular. Health care internationally is characterised by government sanctioned cartels such as trade unions (like the British Medical Association) and the patent protected drug industry. Drug companies use high prices to fund research and development, which in the past decade has been disappointingly ineffective in bringing novel cost effective products to market. Poor governance of trade unions meanwhile has meant they have perpetuated the inefficient use of society's resources while remaining highly successful in achieving the personal and professional goals of those they represent.

Doctors' self interest manifests itself in two ways: enhancing personal income and fiercely protecting clinical autonomy—the right to do what they think is best for the patient in front of them. The first type of self interest has enhanced average UK earnings to over £100 000 for both general practitioners and consultants with little observable quid pro quo in terms of enhanced activity or improved patient outcomes.

The general practice quality and outcomes framework inflated earnings by 30%,³ but with a limited evidence base and little baseline data its benefits are uncertain.^{4 5} Furthermore, by moving away from traditional non-financial incentives to payment for results, the NHS may have undermined public service values that emphasise the importance of trusting professionals to behave efficiently and created a system whose transactions costs, in terms of policing, may be high. Furthermore it may promote changes in skill mix, some of which are of unproved cost effectiveness,⁶ as commissioners seek to eradicate deficits. The cost of replacing out of hours cover with other providers has increased expenditure and contributed to the current inevitable sharp downward pressure on general practitioners' pay as the government seeks to restore financial balance in the NHS.

The consultant contract was also expensive and its design paid scant attention to inefficient variations in clinical practice, substantiated in policy literature for decades,^{7 8} the continuing long term decline in clinical activity,⁹ and the absence of outcome measurement.¹⁰ The potential in the contract for improving productivity by collaborative management, particularly of the content of job plans and clinical excellence awards, remains largely unconnected to quantitative management of activity and outcomes. This pay increase has inflated NHS expenditure with all too little benefit to patients or taxpayers, while giving more general practitioners incentives to deliver what good practitioners were already providing.

Clinical autonomy

The second area of doctors' self interest is the understandable desire to do the best for their patients. Doctors control the allocation of most healthcare resources. Society contracts with them to deliver care efficiently and equitably within cash limits. As it is impossible to legislate for all actions, much of the contract relies on trust, an important element of which is the expectation that doctors will ration access to care efficiently.

Rationing requires doctors to decline care even when patients would benefit from it and would like to have it. Doctors should not support patients' demands for care of marginal cost effectiveness when that inevitably results in depriving other patients of care from which they would benefit more. Furthermore, they must resist lowering treatment thresholds without evidence of cost effectiveness. A doctor's concern for the individual patient and his or her self interest can lead to inefficient practice that ignores the opportunity costs of decision making—a decision to give Jones a marginally cost effective treatment deprives Smith of cost effective care. Such inefficiency in the use of society's scarce resources is surely unethical?

Making self interest work

Self interest and responding to financial incentives are an unavoidable and potentially beneficial aspect of human behaviour if they are channelled into improving the performance of the NHS. Recent reforms have ignored this potential to improve patient care, putting the pay rise cart before the productivity horse. These pay increases, together with workforce management which has led to unaffordable employment increases, are creating deficits and undermining patient care and the financial performance of the NHS.

An essential part of the mitigation of these failures is the linking of reward to performance, not merely in terms of activity but also in the measurement of patient outcomes.¹⁰ Shifting the focus to whether care improves patients' health will create “signals” for targeting cost effective investment. Without such signals inefficient governments that misspend taxpayers' resources and powerful providers focused on short term gaming will continue to undermine the NHS. Instead of talking merely about money, we need to determine whether its use benefits patients or is merely a form of social security for providers.