“If we want to make space for innovation, we need to get better at decommissioning”

Nigel Edwards is an independent health policy expert and former Policy Director of the NHS Confederation, and Chief Executive of the Nuffield Trust. His career has focused on innovation and change in the delivery of health services across the world. The Medical Technology Group recently sat down with him to discuss some of the findings from its Commission on NHS Culture for Innovation and Technology.

In your recent article on commissioning and the new roles for ICBs, you describe the role of ICBs as “system orchestrators” — creating the conditions for innovation rather than attempting to design every detail themselves. Do you see parts of the system starting to move towards this, and is there an international comparison, or model, that can inspire wider change in this regard?

We’re still in the early stages of people working out what strategic commissioning actually is. There’s been a slightly odd sequencing of the policy, in that the Department for Health & Social Care announced a downsizing of the regions and the ICBs, and only then started describing what the functions were. That was the wrong way round, and it’s led to quite a lot of disruption.

One of the reasons I wrote the piece was a worry that we were repeating the same mistake — that, in the UK, commissioning has been far too involved in detail and not focused enough on the overall population outcomes it should be achieving.

It’s not immediately clear that this new model particularly helps. It depends: if the providers get more involved in thinking about commissioning and population health, and the strategies become more co-produced, then — because much of the innovation is identified by providers and brought to payers — that provides a better route for it. But the overall problem we’ve got in the system is that if you want to make a strategic shift from hospitals to communities and primary care, the only way to do that substantially is through differential rates of growth — which means putting a cap on growth in spending in the acute sector.

The case for disinvesting will need to be more rigorous. Rather than buying new technology and adding it onto what they currently do, they have to get better at stopping things — which has been one of the historic reasons behind the slow pace of innovation in the NHS, apart from a degree of innate conservatism. It’s often the case that we don’t look at what already exists — we just ask, what’s the business case for this new technology? No one actually asks the question: is the business case for the technology we’re currently using any good?

We now have new value-based procurement guidance that’s supposed to push trusts towards a more longer-term, more strategic understanding of value, and your piece raised doubts about what can actually be achieved through these kinds of procurement reforms. What do you think is missing from this conversation about value-based procurement, and the push for a more long-term consideration of value in healthcare?

I think one of the issues is that the value-based and bundled-payment approaches you’ve seen in other countries tend to be quite narrow in scope — they cover things that are relatively easy to define, like a hip replacement, or a single disease pathway. I don’t think you’ve seen anywhere doing comprehensive, value-based commissioning across all pathways for a whole population.

There’s this model — what are called integrated health organisations, or IHOs, which are like accountable care organisations in the US. A provider takes complete responsibility for the health of its population and is paid on a capitation basis. That’s interesting, because it changes the incentives — if you run a traditional hospital, the objective is to fill it, to have as many patients in it as possible. If you’re running a capitated system, your incentive as a hospital is to treat it more like a cost centre — you want to try to keep it empty. In that model, commissioners don’t need to do the detail, because they can hand over the whole of the pathway design and thinking to a provider that takes responsibility for the population.

In relation to this question of procurement, one thing I continually hear is: ‘our technology was approved by NICE, so why don’t I understand why it’s not being used?’ Well, here’s why. NICE looked at your technology and said, that’s got a cost per QALY of twenty thousand pounds, whatever the figure is. I’m not buying it, because actually, if I invest in hip replacements, or better management of chronic disease, my cost per QALY is more like two thousand pounds. The fact that something’s gone through NICE just tells you it isn’t over the edge of what looks cost-effective — but it doesn’t mean it compares well with the other choices I could be making strategically as a payer. And people don’t seem to grasp that — one of the jobs of the strategic commissioner is to make allocatively efficient decisions about the deployment of resources.

Innovations that actually increase value — increase productivity, create more health gain for less money — are going to do a lot better than those that just improve quality, or slightly improve quality, for patients who are already being treated. So I think the nature of the innovation, and how it fits this new world, is quite an important question and I think a lot of commissioners are at an early stage of thinking this through.

But I think decommissioning will also need to be a priority — there isn’t a very satisfactory or well-established approach to it. There aren’t that many examples that have been done well, from what I can see. But they’ll have to get better at it, because if they want innovation, they need to create the headroom for it — otherwise there simply isn’t enough.

Something that jumped out in your piece was this issue of accountability in the system — this is something the MTG is currently looking at with its Commission on NHS Culture. You point to unclear decision rights and a lack of standardisation. What do you see as the main driver of that? Is it about leadership and culture and individuals, or is it something more deeply embedded in the structure of the system?

That’s a very good question. One of the issues I think is what the outcomes framework should look like — there’s discussion about whether it needs to be reviewed and made lighter, as I understand it.

ICBs are doing some self-assessment at the moment. The problem is it’s hard to pick particular ones out, to be honest. There are some — London, West Yorkshire — that appear to be a bit ahead, but nothing particularly springs to mind.

What’s interesting is that ‘commissioning’ is really only a term used in the UK — it’s not used much elsewhere. What we call commissioning, other people call planning, because of the provider-market structures we have, instead of using traditional pricing and market mechanisms. More generally, looking across Europe, I get the impression people are starting to realise the limitations of using Diagnostic Related Groups — we call them Healthcare Related Groups — activity-based payment as a method of controlling providers doesn’t really work well. It’s early days — Portugal, for instance, is starting to experiment more with a combination of capitation and performance-related payment, with an element of patient choice, so patients can move between different integrated systems. So it’s a bit of both, but the major driver is more about policy and professional judgement than about economics or incentives.

But when it comes to accountability, it has to be thought about in the context of these organisations having had to lose half their staff, in a process that wasn’t very well thought through or planned. They’ve lost a lot of the functions they used to do — though they still hold quite a lot of statutory functions they can’t get rid of, because they’re set out in law. So a disproportionate number of the people who did commissioning have probably left. At the moment, I think people are working out how they do this with reduced resources — where they focus, and, by implication, what gives — what can they not do that they might otherwise like to be doing? That’s become quite a live question.

Image Credit: Nigel Edwards headshot via ppl.org.uk 

July 2026