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Britain’s National Health Service, once described as the closest thing the country has to a national religion, has anointed its latest prophet. Simon Stevens is to take over as chief executive of the sprawling state behemoth that is one of the world’s biggest employers.
At first glance, 47-year-old Mr Stevens is a surprising choice as chief executive of NHS England. The service regards itself as the proud antithesis of American for-profit healthcare. Yet Mr Stevens has spent close to a decade as a senior executive with UnitedHealth Group, a US healthcare company.
Mr Stevens was also formerly active in the Labour party, serving both as a local councillor and as a special adviser on healthcare in Tony Blair’s government. Yet a Conservative prime minister and health secretary have entrusted him with control of a significant chunk of the service’s £100bn annual budget – just as a general election approaches in which their stewardship of the NHS will become an increasingly potent issue.
That the coalition has chosen to overlook such cultural dissonance says much about both Mr Stevens’ reputation and the scale of the problems besetting the health service. He succumbed to a wooing operation by Prime Minister David Cameron that was organised by Sir Jeremy Heywood, the government’s most senior civil servant and fixer. It was Sir Jeremy who assured an initially sceptical prime minister that Mr Stevens’ reforming credentials transcended party divides.
The NHS is in need of intensive care. A succession of scandals has blighted its reputation for both quality and managerial competence. This week it emerged that millions of pounds have been paid in severance settlements to staff made redundant during a much-criticised structural shake-up. Some were later rehired to successor bodies with tellingly similar remits.
Looking further ahead, the NHS will need to meet a remorseless rise in demand with what is highly likely to be a much tighter budget. Friends say Mr Stevens deliberated hard about the job, which meant not only a big salary drop but moving his family, including his US-born wife and two school-age children, from a comfortable life in Minneapolis into an unforgiving spotlight.
A comprehensive schoolboy from Birmingham, he entered the NHS in 1988 as a graduate trainee after studying at Balliol College, Oxford. Roy Lilley, a former senior NHS manager who became a close friend, first encountered him in the 1990s. “He was bright, attractive and charming. He didn’t suffer fools gladly but he set an enormous example by his own standards. I remember quietly thinking: ‘he’s too good for the NHS’, which is a terrible thing to say but he was just in a class of his own.”
Those who have worked closely with him say it is hard to overstate his influence on health policy during the Blair years. As special adviser to Alan Milburn, health secretary for four years from 1999, and later to the prime minister, he was instrumental in the shibboleth-shattering decision to turn to the private sector for additional capacity and a bracing injection of competition.
Opening privately run surgical treatment centres and even sending some patients abroad for treatment broke up the NHS monolith. Waiting times tumbled and many of those rich enough to have flirted with private healthcare flocked back.
Cultured and urbane – “able to talk about art and music”, says one associate – Mr Stevens would brook no opposition from the traditionally sclerotic health service bureaucracy. He secured a 30 per cent reduction in the number of civil servants, making health the only department to meet a key cost-saving target.
One official recalled: “He could be quite forceful but he tended to employ a more intelligent approach, asking: ‘Why haven’t you thought of this?’ rather than shouting at you – which in some ways was more difficult to deal with.”
Mr Stevens will have to navigate tricky internal politics. His own background will cause some trouble. He knows that some will – inaccurately, he insists – portray him as an instinctive “privatiser” as a consequence of his time at UnitedHealth. He has already demonstrated a deft touch in choosing to forgo 10 per cent of his £211,000 salary “in the light of NHS spending pressures”.
Changes to the role mean his writ will not run as far as that of his predecessors. The majority of the health budget is now in the hands of groups of clinicians, which means that he will have direct control of only 30 per cent of the sum spent on the English part of the service each year. The coalition’s reforms have removed operational control of the NHS from Jeremy Hunt, the health secretary, but insiders say that he continues to intervene, particularly when he thinks there is political capital to be made.
Mr Milburn says that if anyone can make this “chaotic and confused” architecture work, it is Mr Stevens. “I have never known a time when the NHS has been so lacking in certainty and clarity of direction,” he says. One of his main tasks will be to find ways to unlock innovation and enterprise in a system long characterised by command and control. Central diktat may have worked when the principal problem was waiting lists, but is less effective for improving the quality of care.
If he can present a tighter spending environment not simply as a constraint but as an opportunity for much-needed changes in the way care is delivered, Mr Stevens could help recalibrate public expectations of the NHS and aid its survival as a free-to-all service well into its seventh decade. If he fails, and the service declines, he will attract much of the opprobrium from a frustrated public.
But the challenge of running the organisation in which he has spent most of his professional career seems to have been worth the risk. Mr Lilley added: “He said to me: ‘I’ve thought about it and I’m going to do it ... You know how I feel about the NHS.’”
The writer is the FT’s public policy editor
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