One of the first rules in life is that you should be prepared to fight your battles to the hilt, but you should pick the right battles first. The cardinal assumption of Labour’s policy is that it embraces the market. From this, everything in the Health and Social Care Act (2012) has flowed, including awarding procurement contracts to the private sector through competitive tendering, insolvency regimes of ‘failing’ hospitals, and the need for an economic regulator with teeth.

Ed Miliband has made it clear in his ‘One Nation Economy‘ that he doesn’t wish to see the private sector at war with the public sector or vice-versa. To this end, he appears aspire to a promised land where unionised workforces are relevant also to the private sector, enforcing decent working conditions for employees, perhaps through a ‘living wage‘. This obviously has consequences for the ‘One Nation Society‘. Despite Miliband having fired some shots at overzealous corporates, he has previously emphasised the need for corporates to act like good citizens, like members of Unions, with no ‘vested interests‘. This of course is the ‘One Nation political process‘.

The NHS is an important institution for Labour, and Labour is consistently a number of % points ahead of the Conservatives on the NHS, despite the rather boombastic hate-filled speeches coming from the Conservative Party. The argument of ‘public good, private bad’ is argued by some to be outdated, whereas others feel that it is more important than ever to ‘fight for the NHS’. Burnham has been quoting Nye Bevan to ‘motivate the troops’, against the backdrop of a £2.4 bn reorganisation which can only lead to a fragmented, privatised NHS.

Nurses, healthcare assistants and doctors form the backbone of the NHS, a vast majority are a member of a Union of some sort, and some of these also want to do private work, it is argued. Labour wishes to propose a narrative where it wishes to protect NHS values, but the history of Labour involving the private sector is not new, with the private finance initiatives, independent sector treatment centres, and “NHS global”. Drawing on analogies with other sectors, the hospital is not just a place where you get treatment; people go there to improve a sense of wellbeing. Hard-nosed business analysts might argue that this is not a million miles away from a top-notch cinema, where most of the money is not made from displaying the film but selling the popcorn.

It is difficult to argue against the idea that the NHS itself shows great diversity at secondary care level. For example, there are district general hospitals in the community, NHS Foundation Trusts, and “tertiary referral” centres where difficult cases from NHS Foundation Trusts (or cases from abroad) might become referred. They will all have medical Doctors doing varying degrees of acute versus chronic work, and practice-oriented work compared to academic research-oriented work, for example. It can be argued that certain tertiary unit hospitals, such as Great Ormond Street, Moorfields Eye Hospital, the Royal Marsden, or the National Hospital for Neurology and Neurosurgery, see complicated cases with a unique capacity for research and innovation, which is even hard to compete with on the global stage. It is hard to describe that the case mix of the Royal Marsden for cancer and palliative care on the Fulham Road is the same as a busy unit such as Northwick Park on the Harrow Road in Middlesex.

There are various assumptions about the ‘exporting’ of care too. There has been a focus on US companies wishing to muscle in on the National Health Service, enabled perhaps through the US-EU Free Trade Treaty, but it is an escapable fact that there are many laboratories and medical firms of great expertise here in the UK, particularly in Cambridge and London, which provide really ground-breaking expertise in novel therapies and orphan drugs that can easily be exported. At the other end of this luxury end of the market is the value end, where high volume of very basic diagnostics can be done as a service theoretically for anyone in the world.

The current situation regarding the “private patient income cap” (more correctly an “income cap for non-NHS work“)  in the Health and Social Care Act, through s. 164(1)(2A), is described as follows:

An NHS foundation trust does not fulfil its principal purpose unless, in each financial year, its total income from the provision of goods and services for the purposes of the health service in England is greater than its total income from the provision of goods and services for any other purposes.

This figure, that the patient income from non-NHS sources must not be above 49% effectively, is nowhere near the ‘cap’ in previous incarnations of the law in this jurisdiction, and indeed many Foundation Trusts do not have a figure anywhere like 50% of private income. This has been interpreted as a “cap”, and provides an emotional campaigning tool regarding the NHS ‘going into private hands’, but has been there in some forms for several years. The problem with the notion of a “cap” is that it all too easily can be interpreted as a target, where hospitals try to ‘compete’ for which can generate the most income from non-NHS sources, and don’t wish to be ‘the odd one out’. A parallel with this might be how Universities have, between themselves, set the level of their tuition fees. The cap itself seems arbitrarily selected, in that conceivably there could be no cap at all. The actual purpose of the cap might be symbolic, in signifying that NHS hospitals cannot under law allocate all their resources into doing non-NHS work.

Mark Britnell at KPMG has previously given two possible justifications for allowing NHS Foundation Trusts to generate non-NHS income: that is, so that the income can be pumped back into the NHS to improve facilities and to encourage innovation.

The problem with the argument proposing a subsidiary source of funding, it can be led to the conclusion that those hospitals which do not have a private source of income produce worse patient care than those who do. This is a very powerful, and dangerous, signal.

Without a guarantee that there is a minimum spend on NHS care (for example on staffing), it is possible that money might get siphoned off into the private sector, and ‘private patients’ on NHS sites might be ‘queue jumping’ and ‘competing’ for the time of NHS doctors and nurses on site.

On the other hand, it might be good for the patient that skilled NHS doctors are also available on site to deal with complex problems of private patients, as they are all competent in acute medicine, and it also allows NHS doctors to work for NHS institutions rather than to work entirely for the public sector.

The first offering through this improved patient care argument is that this is addressing ‘patient choice’, in other words if patients want private-sector clinical care on a NHS site they should be allowed that opportunity. This might be akin to allowing schoolchildren the opportunity to attend a ‘free school’ in the education system. The second offering is that ‘best practice’ innovation can filter down into all areas of an organisation, and there is an assumption that increased innovation can improve more effective care for patients.

The main problem with this argument is that there can be subtle barriers in transfer of knowledge and innovation within any NHS organisation. These barriers, indeed, are likely to be exacerbated, if there are physical barriers between NHS and private patients in any ‘NHS hospital’, for example they are on different wards.

Andy Burnham and Labour, when they hopefully come into government on May 8th 2015, will have to prioritise what they actually want to do in reality for the NHS. It is likely that, if he can capture the “anti-privatisation” mood music of the country, he will be in government at all. Of course, if Labour remains in opposition, all of this is irrelevant.

A battle which Burnham can presumably attempt to win is for the Secretary of State to offer a universal, comprehensive, free-at-the-point-of-need service in the NHS. If Burnham had really wanted to do this, some say, he would have ‘signed up’ to Lord Owen’s ‘amended duties and powers Bill’ in the House of Lords. As it happens, Ed Miliband has signed up to it, albeit in a Daily Mirror article.

It then becomes a question of priorities. In repealing the Health and Social Care Act (2012), it is all very well for Burnham to champion taming the beast of competition which some might say was unleashed in some form towards the end of the Labour government. Nonetheless, if Burnham champions the ‘NHS Preferred Provider‘, he is still assuming a rôle for the market, and all that necessitates as described in the first paragraph.

It might be unworkable to reduce the cap in a phased manner, or bureaucratically to stipulate that a Trust such as Moorfields goes from 15% to 4% in three years. The management board will have to have some certainty in their business plans, and it is hard not to see this interference as Statist, if it is the case that there has never been any detriment to NHS patient care. Simon Burns MP of the current Government has long argued that there is no actual evidence for any detriment in NHS patient care through uplifting the private income cap.

In aspiring to reduce the cap to ‘single figures’ as Burnham appears to want to do, it could appear that Burnham wishes punitively to fetter the activities of individual NHS Foundation Trusts. Any Trust doing groundbreaking work, such as a novel treatment for macular degeneration in Moorfields Eye Hospital, may find this unnecessary and disproportionate.

There is currently no statutory cap for safe staffing levels, and some might say that this is a more worthy focus of all Governments to improve patient care in the NHS. In striving for consistency in policy, one might wonder why a statutory cap for private income has been imposed nationally, but no definition of safe staffing levels.

On the other hand, the “democratic deficit” may have widened through a £2.4 bn ‘top down reorganisation’, which no-one appears to have voted for. Hunt has often been keen to state that he no longer has direct responsibility for the affairs of individual trusts, and campaigners might feel it is a step too far to see NHS Foundation Trusts ‘doing more private work’.

If NHS Foundation Trusts do more private work, and this is clearly to the detriment of NHS patients, the case for reducing massively the private income cap would be much easier. However, given the diversity of work taking place in the NHS, it can be argued that imposing a statutory cap at all is not an appropriate solution.

Reducing the Private patient income cap is going to be enormously popular with many in the public, but this could turn out to be a battle which Labour may wish it never began to fight.