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Lansley forced into price competition U-turn

By Alisdair Stirling

GP pressure has helped force health secretary Andrew Lansley into an embarrassing climbdown over price competition in the health service.

Mr Lansley will table amendments to the Bill to stop GP consortia, hospitals and other providers from undercutting each other in the face of pressure from the BMA and other critics.

The Bill as published would have allowed Monitor, the NHS market regulator to set either a national tariff for services or a discretionary maximum tariff, which opponents said would allow providers to compete on price rather than on quality.

In an effort to silence critics, NHS chief executive Sir David Nicholson wrote to trusts last month saying there was ‘no question' of introducing competition on price into the NHS and that any change in services should be based on quality of care, would mean nothing unless the Government amends the health bill.

But GPC leaders warned Sir David's letter did not go far enough, and would be 'meaningless' unless the bill was amended.

In a statement released this week, the health secretary said: 'We want the tariff to be a nationally regulated price, not a starting-point for price competition. These amendments will put our intentions beyond doubt.'

NAPC chair Dr Johnny Marshall said it was difficult to assess the effects Mr Lansleys changes would have without seeing the wording of the amendment. But he told Pulse: 'We all buy into the principle that we want to compete on quality not price.'

Dr Marshall added that the situation would not be clear-cut even if the amendments prevented Monitor from setting maximum tariffs: 'If the tariff is set above the cost of delivering the service, that allows competition on quality. If the tariff is set below the cost of the service, the chances are that quality suffers.'

Andrew Lansley has agreed to amend rules on pricing in the health bill