The arrival of the new UK Coalition Government has brought with it proposals to reform the health care system in the UK over the next four years, detailed in its much-publicized White Paper "Equity and excellence: Liberating the NHS."

The detail of the proposals is currently very high-level. The stated objectives are ambitious and, if instituted, will have a far-reaching effect on both the way the British public accesses the health system and the role of the private sector in UK health care.

Ambitious Objectives and Targets

The main objectives laid out by the government are to:

• Put patients and the public first by implementing a policy of "no decision about me without me"
• Improve quality and health care outcomes through the institution of a more "lean structure," with better defined responsibilities
• Achieve autonomy, accountability and democratic legitimacy with transparency and competition as key drivers
• Cut bureaucracy and improve efficiency.

Of course, the NHS cannot be exempt from measures that are to be put in place to confront the UK deficit and growing debt. Consequently, it has set robust targets such as: 

• Releasing up to £20 billion of efficiency savings by 2014
• Reducing NHS management costs by more than 45 percent over the next four years
• Simplifying the number of NHS bodies, reducing the Department of Health's NHS functions and abolishing superfluous quangos

whilst committing to increasing NHS spending in real terms year on year.

NHS Structural Reforms

The magnitude of the reforms announced is considerable. In particular, the layers, responsibilities and accountability of NHS bodies are to be significantly restructured. Some of the key changes are:

Economic regulation and quality inspection
The powers of the existing health care procurement regulator, Monitor, will be scaled up to act as an economic regulator in a marketplace prime for development and activity. Monitor will have ex ante powers to drive competition and open up the UK health care market, including requiring monopoly providers to grant access to their facilities to third parties, conducting market studies, and referring potential structural problems to the Competition Commission for fuller investigation. Monitor will also investigate complaints of anti-competitive purchasing and act as arbiter.

GP commissioning consortia
Power and responsibility for commissioning services will be devolved to local consortia of GP practices with Primary Care Trusts being phased out. Legislation to this effect is expected in the forthcoming Health Bill. These consortia are anticipated to require significant assistance, including from the private sector, in exercising these new commissioning functions.

Existing NHS providers
A significant indication of the scale of the reforms is that Foundation Trusts are to increasingly fall outside state control. Legislation is anticipated that will remove borrowing limits; abolish the cap on the amount of income Foundation Trusts can earn from other sources, such as private patients, to reinvest; and enable Foundation Trusts to tailor their own governance arrangements. This relaxation of control is to be made so as to allow Foundation Trusts to be able to compete more freely with third-party health care providers. This increased flexibility may also facilitate more flexible partnership arrangements with the private sector. "NHS Trusts" are to be abolished.

The New UK Health Care Marketplace

Although the White Paper does not go so far as to indicate that privatization of the NHS as such is being considered, the government's tone is bold in that it advocates public choice, and recognizes that resultant competition must include third-party private providers.

The key themes of the White Paper are based on choice for the patient, flexibility for the commissioning consortia, encouraging competition and social enterprise. This, within an ambitious four-year timetable, indicates that there will be room for unprecedented private, for-profit and nonprofit, and third sector involvement in the reform of the UK health care system.

Any Willing Provider
By April 2011, the government wants to have in place an "any willing provider" structure. This strategy will have the effect of reducing barriers to entry by new suppliers and, as GP consortia are gradually introduced and more powers are devolved to them, the effect on private and public providers is sure to be appreciable as regards choices the commissioning consortia and patients will be making.

A further point of interest is that if providers deliver excellent results, the commissioner will be able to pay a quality increment.

Information and Research
The government sees the open availability of "information," as the key to better care and reduced costs. Consequently, aggregated, anonymised data on care and services is to be made available to allow intermediaries to analyze them and communicate them to the public. Lack of information has historically been an obstacle to the entry of private providers in the UK health care system.

Also proposed is that the research sector will benefit from this "information revolution," with new areas of research a major aspiration of the government. There is an explicit acknowledgement in the Paper that a "thriving life sciences industry is critical to the ability of the NHS to deliver world-class health outcomes." In the same breath, the Paper also recognizes that NHS resources are finite, and therefore the role of the third-party research institutions will continue to be promoted.