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14
Feb

CMA says competition is good as government plans to remove its duties


Economists at the Competition & Markets Authority (CMA) claim that hospital mergers risk patient safety. In a new working paper, 'Does hospital competition reduce rates of patient harm in the English NHS?' authors Russell Whitehouse and Pasquale Schiraldi conclude that competition is beneficial to patients' wellbeing.

 

This train of thought goes against the current direction of travel for the healthcare system, which, as set out in the NHS Long Term Plan, rests clearly with Integrated Care Systems. ICSs will see providers from all sectors of health and social care working together rather than in silos or even against each other.

 

The NHS Long Term Plan announced an intention to remove the CMA’s duties of intervention in NHS provider mergers introduced by the 2012 Act. This announcement was welcomed by politicians, including Labour’s Shadow Health and Social Care Secretary, Jonathan Ashworth, who said: “The fact NHS bosses are now proposing significant changes to the Health and Social Care Act confirms what a wasteful, bureaucratic disaster it was in the first place. Labour has long called for this Act to be binned and will study legislative proposals carefully.”

 

However, the CMA paper states: "Our main estimate is that a hypothetical future merger between two geographically proximate hospitals would, on average and assuming no offsetting clinical benefits are unlocked by the merger, result in a 41% increase in harm rates. The magnitude of the effect is significantly greater where few competitors remain post-merger, and smaller when several alternatives for patients remain. This effect is robust to a number of alternative specifications and holds also when we consider in-hospital mortality."

 

The CMA paper uses quarterly data from financial years 2013/14 and 2014/15, by which time, it says, the policy to establish choice in the health system was well established. It claims to bring a new approach compared with existing literature over the benefits of competition in the NHS in England in that it analyses "a new and broader dimension of quality" using a new indicator to assess four key harms - from falls, pressure ulcers, blood clots and urinary tract infections.

 

It also uses a different identification strategy to look at variation within hospital Trusts across departments, not just across Trusts or over time.

 

The paper has been criticised by health sector commentators, including Nigel Edwards, head of the Nuffield Trust, as quoted by the Guardian’s Polly Toynbee: “It’s purely hypothetical, based on a hypothetical hospital and hypothetical patients, viewed only through the lens of competition.”

 

Polly Toynbee calls the paper: “A shock report that claims a massive death toll will result from taking competition out of the NHS. If true, these findings suggest patients are dying like flies in areas where hospitals merge or which only have one hospital: it claims a merger resulting in a monopoly increases mortality by a staggering 550% and adds 182% to other harms, such as ulcers and blood clots.” 

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