NHS shake-up: The basics

The government has announced an overhaul of the health service in England.

It has been dubbed the most radical since the NHS was created in the aftermath of World War II.

The effect will be felt across the whole health service - among its 1m staff, in its 200 major hospitals and throughout its 8,000 GP surgeries.

What is happening

The most obvious change is that GPs will be put in control of much of the NHS budget. From 2013, they will take over planning and buying local services from primary care trusts.

GPs will group together in consortia and with the support of managers decide on what services their local populations need. However, it does not mean every GP will get involved as in practice most will delegate responsibility to a small minority of willing doctors.

The move will lead to the abolition of the 151 primary care trusts and 10 strategic health authorities that oversee them.

The changes are already being piloted and will cost £1.4bn to introduce, a figure which the government says will be easily recouped by the savings made by scrapping PCTs and SHAs.

On top of that, the NHS is being opened up even further to the private sector.

To date, the involvement of private companies has been limited. Some groups have contracts to run minor treatment clinics which were set up under Labour to get waiting lists down in areas such as hip and knee replacement and eye surgery.

Meanwhile, under patient choice, people can chose from a list of approved private hospitals which have agreed to treat people at NHS cost. However, only about 30,000 patients a month take up this option, a fraction of the total numbers undergoing treatment.

But under the changes being proposed private hospitals will be able to compete for patients on an equal footing with NHS trusts.

The case for the changes

The government says the re-organisation is needed to help the NHS cope with the increasing demands from factors such as the ageing population, cost of new drugs and rise in obesity.

While the NHS is receiving small rises in its budget in the coming years, it has still been tasked with finding £20bn of efficiency savings over the next four years. That is equivalent to about a 4% saving each year.

However, the NHS has been getting less productive. Over the past decade, productivity has been falling by an average of 0.2% a year.

Ministers believe by putting GPs in charge of making decision the NHS will become more responsive to the needs of patients. In particular, it is hoped that they will help set up more services in the community which tends to be cheaper than seeing patients in hospital.

On opening up the hospital sector to the private sector, ministers say this will help drive up standards and is a natural move if patients are to be truly put in charge of their own care.

They have also tried to allay fears that hospitals could close. If a hospital is not good enough to attract patients, the government has questioned whether it deserves to survive in its current form.

But when it comes to essential services, such as rural A&E units, they say there are contingency funds in place to make sure they do not have to close.

The case against the changes

The government has been criticised from all corners. The House of Commons' Health Committee said the changes took the NHS by surprise and as such will undermine its ability to make savings.

Health managers have said the scale of the changes could destabilise hospitals and force some units to close.

Meanwhile, unions, including the British Medical Association, Royal College of Nursing and Unison, have warned they represent a privatisation of the health service.

Some have even likened the changes to the privatisation seen in industries such as gas and electricity.

The fear is that private companies will cherry-pick the easiest patients, leaving the NHS to deal with complex cases that are more expensive to treat.

This, they argue, could destabilise hospital services and ultimately lead to them closing.

Another common criticism is that the overhaul could not have come at a worse time as the NHS should be concentrating on making savings.

It seems pretty damning. But those that have attacked the plans are not opposed to every aspect.

The move to get GPs more involved has been widely welcomed. Although some question whether PCTs have to go to achieve that.

For example, both the BMA and Royal College of GPs have suggested doctors could have just been given a more prominent role on the boards of PCTs.

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