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Health service development and planning

Health Service Development and Planning


The structure of the new National Health Service in 1948 reflected its
disparate origins and artificial divisions between different elements, which had
persisted for many years (see Historical
development of personal health services and of public health.
) The
three main strands, state owned (nationalised) hospitals, a national network of
general practitioners and community and domiciliary health services, were
financed centrally but managed separately. Throughout the history of the
NHS, this initial division of functions between separate statutory organisations
created problems in the provision of comprehensive and co-ordinated services.

During the 1950s, having created an enormous nationalised health industry,
the various government of the day began to look critically at how the services
could be managed efficiently. A report published in 1956 (Guillebaud Report),
expressed early concern about many issues, which is still familiar in the 2000s.
These included:

  • Changing trends in health and illness.
  • The importance of prevention of illness.
  • The needs for GPs and hospitals to work closely together.
  • The need to make adequate provision for the care of old people in their
    own homes.
  • Whether the NHS would in practice be able to meet every demand justifiable
    on medical grounds.

The 1960s brought a decade of fast expansion in new buildings and technology
and the health service benefited with a boom in the building of new hospitals.
Health planning concentrated on capital schemes. The 1970s were characterised by
"corporate" approaches to the management of health. The 1974
reorganisation happened at a time when the capital boom was tailing off and
planning began to emphasise services, rather than building. There was an
emphasis on co-ordination and management of services within clear geographical
boundaries. By the late 1970s it was apparent to the majority of NHS planners
and decision makers that the NHS planning system was not working. Two major
reallocations of financial resources were under way by the beginning of the
1980s, from one geographical area to another to address historical inequalities
(RAWP), and towards non-acute services. The first round of reforms was initiated
to respond to a growing dissatisfaction with the services provided. In essence,
the spending on the service was slowing whilst the demographic and technological
developments were stocking demand. At the heart of the reforms, introduced in
the 1990s, was the devolution of control to NHS trusts and general practitioners
and the use of competition to improve performance. Within the so called internal
market, the intention was that money should follow patients in order to reward
hospitals and other healthcare providers that offered services which were
efficient and responsive to users.

From the mid-1990s, successive governments began to signal a shift in policy
towards a greater emphasis on enhanced Patient and Public Involvement in
healthcare. New Labour introduced a further set of reforms via their White Paper
The New NHS: Modern, Dependable 1997, which claimed to be
different from both the command and control mechanisms used after the
establishment of the NHS and the market oriented policies of this government's
immediate Conservative predecessors e.g. ‘Efficient use of resources will be
critical to delivering the best for patients. It is important that managers and
clinicians alike have a proper understanding of the costs of local services so
that they can make appropriate local decisions on the best use of resources’ (The
New NHS: Modern Dependable 1997

Indeed, the government has argued that these reforms represent a “third way”
that goes beyond both planning and markets. In reality, the third way comprises
a mixture of policy instruments, embracing elements of planning and competition,
directives and incentives, and centralisation and devolution. Alongside planning
and competition, the third way makes use of other mechanisms, including new
forms of inspection, regulation, and the publication of information on
comparative performance within the NHS. The implicit assumption of the third way
is that human behaviour has more, and more complex, motivations than were
recognised by proponents of the first and second ways. Accordingly, policy
makers needed to have access to a range of instruments if they are to deliver
their objectives.

The NHS Plan 2000 is the Government’s ten year programme of investment and
reform and was drawn up in co-operation with NHS staff and patients. The NHS
Plan principles were endorsed by leading professional and patient organisations
and provided a vision of services designed around the needs of patients and
improved health outcomes particularly for the poorest in our society. 

To support this vision, the Plan set out a coherent framework of:

  • high national standards and clear accountability;
  • devolution of power and resources to the front line to give health

who deliver care the freedom to innovate;

  • increased flexibility between services and between staff to cut across
    outdated organisational and professional barriers; and
  • a greater diversity of service providers, and choice for consumers.

1948 Model

New Model


free at point of need

free at point of need


annual lottery

planned for 3/5 years

National  Standards


NICE, NSFs and single independent healthcare inspectorate/regulator



Plurality – state/private/voluntary


rigid professional demarcations

modernised flexible professions benefiting patients


handed down treatment

choice of where and when get treatment


top down

led by frontline – devolved to primary care


long waits

Shorter waits, 18 weeks waiting time target booked appointments

(After DH 2002)

The 2001 Health & Social Care Act Section 11 placed a duty on all
NHS organisations to make arrangements to involve and consult patients and the
public in service planning and operation. As a result of government guidance in
2003, the new Patient and Public Involvement Forums were tasked with improving
service provision by bringing forward the views and experiences of patients,
their carers and families. Local Authority Overview and Scrutiny Committees (OSCs)
became operational in January 2003. They were tasked with improving health and
reducing health inequalities by scrutinising health services in England. The NHS
Improvement Plan of 2004
established a commitment to producing patient-led
services and provided guidance on the development of Expert Patients. The
cultural shift emerging from Creating a Patient-Led NHS: Delivering the NHS
Improvement Plan ’in 2005 altered the NHS from a service that
‘does things to and for its patients’ to one which is ‘patient-led’. The
Government also focused on step-changes in NHS practice-based commissioning via
the document Commissioning a Patient-led NHS in 2005. Commissioning
concerns the planning of services at a local level framed by scientific
evidence. The NHS Act 2006 provided advice about consultation for
commissioning services. It also updated Section 11 of the Health & Social
Care Act 2001.
NHS organisations were now required to make arrangements to
involve and consult patients and the public in the planning of the provision of
services, the development and consideration of proposals for changes in the way
those services are provided and in the decisions to be made affecting the
operation of services. The planning process also had to include evidence on
local population and health issues as well as focusing on national and local
health priorities.

PPI now had to be included at all points in the commissioning cycle:

  • Planning
  • Contracting
  • Monitoring
  • Revising

Commissioning and involvement also had to be considered at all points of a
Patient Pathway.

The Local Government and Public Involvement Act of 2007 updated the
involvement policy with a new involvement system of Local Involvement Networks (LINks),
run by local people and groups covering Health and Social Care. The LINk uses
their powers to hold service providers to account. It refers issues to Overview
and Scrutiny Committees and must get responses to all queries. The NHS Centre
for Involvement continues to be a prime facilitator of and support for LINks.
Following Lord Darzi’s recent NHS review (NHS Next Stage Review: Our
vision for primary and
community care, 2008) PPI continues to be an
important part of the modern day NHS. The new NHS Constitution states that
patients have a right to be involved in the development of local services, not
just involvement in personal choice and clinical decisions. Communities in
control: real people, real power in 2008
is the latest White Paper that
passes power to communities, giving real control and influence to more people.

Section 242 of the consolidated NHS Act 2006 placed a duty on NHS Trusts,
Primary Care Trusts and strategic health authorities to make arrangements to
involve patients and the public in service planning and operation, and in the
development of proposals for changes. This duty is supported by the guidance Real
working with people to improve healthcare, launched in
October 2008.

Despite their scale, the reforms have preserved the principle of health care
free at the point of use and provided according to clinical need rather than the
ability to pay.. The challenge for the reform programme is to embed these values
in an NHS that is not only true to its past but also able to face the
significant challenges of the future i.e.:

Rising expectations: the public wanting more from their public
services, to match the choice, customer service and personalisation they get
elsewhere, and wanting services to be more local and convenient too.

The demographic challenge: with an ageing population and increasing
numbers of people with long-term conditions including serious disabilities,
needing the health and care system to focus far more effectively on promoting
good health, independence and wellbeing.

The revolution in medical technology: transforming the ability of the
NHS to prevent, cure and manage diseases, alleviate suffering and extend life
expectancy, but also creating new costs – needing an NHS that is faster and
more flexible in reconfiguring how and where care can best be delivered.

Continuing variations in the safety and quality of care: needing an
NHS that delivers care of the highest possible safety and quality in every place
and at every time, in particular through honest and open information about the
outcomes achieved by our primary, community and secondary care providers.

Please see attached PDF to identify key dates to help understand when
the reforms took place

Health Service Planning

‘Health services planning’ is a term used with increasing frequency today
and reflects the growing interst in the topic in the 21st
century.  The term can mean different things to different people i.e. a
notion of social engineering applied to healthcare or the design of a health

‘Health services planning’ has been described as,

A process what appraises the overall health needs of a geographic area or
population and determines how these needs can be met in the most effective
manner through the allocation of existing and anticipated future resources

Ultimately, all planning comes down to identifying the needs of the target
population and then determining the best means for meeting those needs. However,
within the health sector there is uniqueness about the planning process that
doesn’t occur within industry. This includes,

  • Emotional dimensions - fluctuations in demand and the fact that
    health service providers are often dealing with life-and-death situations.
  • Complex relationships - the healthcare industry is also made of
    many separate entities operating in a virtually uncoordinated manner and
    often at cross-purposes and characterised by a variety of different
  • Financial characteristics – different from other
    industries whereby the end-user may not make the consumption decision or pay
    for the service provided
  • Diversity of functions – different entities perform different
    functions and single entities e.g. a hospital, performs multiple functions
    simultaneously. The functions can range from, providing for the healthcare
    needs of a population to providing a community service and others seeing
    their role as humanitarian or seeing themselves as contributing to the
    safety of the public.

Health care needs vary according to the age structure and health profile in a
population. The likelihood of people seeking care is determined by a range of
social and cultural factors and will impact upon demand for care. The likelihood
of people receiving care is determined by policy decisions and will impact upon
the volume of activity in the health system.

Planning activities and terms

There are many planning terms, which need to be understood in order to
clarify the relationship between these planning approaches. A summary of these
terms is given below:



Economic/development planning

National level activity aimed at steering the economic or development
policies, primarily though public expenditure or fiscal policies

Strategic plan

Document outlining the direction an organisation is intending to
follow, with broad guidance as to the implications for services or

Business plan

Strategic plans prepared by business organisations setting out their
direction, and usually providing income and expenditure projections

Corporate planning

Term, now not often used, to describe an integrated approach to
planning for an organisation. Analogous to business plan

Regulatory planning

Activities of State planning bodies that set planning guidelines for
private sector activities

Service/programme planning

Planning focusing on the services to be provided. Used to contrast
with capital planning (see below)

Capital planning

Planning focusing on the capital developments of an organisation such
as its building programme

Project planning

Planning focusing on discrete time-limited activities

Human resource/manpower planning

Plans focusing on the human resource requirements of an organisation
or country

Physical plans

Plans relating to construction elements

Operational plans

Activity plans detailing precise timing and mode of implementation

Work plans

Operational plans referring to the activities of a small unit or of
an individual

(Green 2007.49)

Initiating Health Services Planning

There are many reasons for initiating a health services planning process,
which can emerge from, the community, an organisation or the interest of a
particular group or individual. However, any healthcare services plan is going
to reflect the influence of the political, social and economic considerations
that are within that particular healthcare environment.  Health service
planning can therefore be undertaken on the basis of change arising from,

  • healthcare reforms which  have changed accountability and
    decision making within the NHS; e.g.  the development of
    semi-independent trusts following the 1990 NHS and Community Care Act, the
    introduction of reform and redesign to all parts of the NHS around the needs
    of patients through the NHS Plan 2000.
  • health care needs which can change over time according to the age
    structure and health profile in a population; e.g. the increasing numbers of
    older people mean a concomitant increase in disability and illness, in
    particular those of dementia, musculoskeletal and cardiovascular diseases,
    and sensory impairment. Health and social systems need to address the
    treatment and care of the increasing numbers of people with these problems.
  • technological advances which continuously challenge the health
    service to put in place a robust and integrated ICT infrastructure e.g.
    Technology and medical advances are major drivers of health expenditure and
    have significant potential to improve the outcomes and the efficiency of the
    health service.
  • evidence-base programmes setting quality standards and specifying
    services, which have been introduced through a set of National Service
    Frameworks (NSFs), since 1997. The current set of 10 NSFs identifies key
    interventions, a strategy to support implementation and establishes an
    agreed timescale.

The challenge for the planner is to balance the objective, technical
dimension of planning with the realities of the context within which the
planning is taking place.

Planning approaches

There are various different approaches to health service planning which can
range from ‘problem solving’, ‘long-term versus shorter operational plans’
and ‘narrative approaches’ which uses matrices presenting a nested set of
objectives set in tabular form. Plans may also be aimed at particular services
such as primary care programmes (e.g. AIDs), or institutions (e.g. hospitals),
or at a wider geographical area such as a district.

Within health planning there are two broad types,

  • activity planning – is concerned with the maintenance of existing
    situations and the setting of monitorable implementation timetables.
  • allocative planning – is concerned with the possibility of change
    and the making of decisions on how resources will be used and which
    activities will be undertaken.

The problem with any conceptual model of planning and policy-making is that
it is not fool-proof. The ultimate outcome of planning is conditioned by the
behaviour of individuals and groups at all levels in the process. The NHS
planning system was seen as an enabling mechanism, one which would facilitate a
more effective use of the scarce resources available for health care.

Concerns about planning

The history of planning in the health sector is still relatively short and
has not always been successful. The dilemma that gives rise to the needs for
planning is often the gap between available resources and health needs, leading
to the requirement to make choices as to how to use these resources. Plans often
fail to be implemented or are implemented but fail to respond adequately to the
real needs of the populations. Common examples are the imbalance of resources
between hospitals and primary care, between preventive/promotive care and
curative care, between different social groups, between different regions or
geographical areas, between staff salaries and medical supplies, or between
different types of staff such as auxillaries and specialists. If planning is to
be strengthened in the future it is important to understand the reasons for any
of these occurrences. A variety of reasons can contribute to poor planning
processes and include,

  • planning becomes an end in itself, with the real aim, that of effecting
    change – submerged under the planning process
  • technical failure to analyse needs appropriately or to estimate resources
  • imposing plans from the centre in a top-down fashion, without the
    involvement of both the health-care providers and the communities in the
  • the planning process has been isolated from other decision-making
    processes such as budgeting or human resource planning
  • the failure to consider the inherently political nature of the process.

During the last decade, the NHS reforms have been clear in their vision to
address these kinds of challenges, by developing a patient-led NHS that uses
available resources as effectively and fairly as possible to promote health,
reduce health inequalities and deliver the best and safest possible healthcare.

Planning Mechanisms and Techniques

Local Area Agreement: Since 2006 local areas across England developed
Sustainable Community Strategies, co-ordinated through the Local
Strategic Partnerships outlining their story of place and long-term
vision. The Local Government and Public Involvement in Health Act (2007)
changed the statutory landscape upon which the new local performance framework,
and in particular new Local Area Agreements (LAA) were founded. The new LAAs
form the heart of the new local performance framework with performance now
measured in an area against 198 national indicators, although the LAAs are the
only vehicle for agreeing targets. Each LAA can include up to 35 national
priority targets agreed between local partnerships and Government against the
indicators from the national set. Partners can also agree additional local
targets to support improved local delivery and outcomes.

Example: Working Together for a Better Derbyshire Derbyshire
Local Area Agreement 2008-2011

and Working Together for a Better Derbyshire Derbyshire’s Sustainable
Community Strategy 2009-2014

Joint Strategic Needs Assessment: The Local Government and Public
Involvement in Health Act (2007)
also specified that local authorities and
Primary Care Trusts (PCTs) produce a Joint Strategic Needs Assessment (JSNA) of
the health and wellbeing of the local community. Needs assessment is an
essential tool for commissioners to inform service planning and commissioning
strategies. JSNA should align with three-yearly Local Area Agreement planning
cycles. Since the findings of JSNA will inform a number of commissioning plans
in addition to the Local Area Agreement, individual areas will use their
discretion to update elements of JSNA, responding to local circumstances
including the availability of new, strategic, plan-changing, information (see

The JSNA guidance – linked to below – ties in with the statutory guidance
‘Creating Strong, Safe and Prosperous Communities’ and works as a
toolkit for local partners carrying out JSNA. The stages of the process include:

  • stakeholder involvement
  • engaging with communities
  • suggestions on timing and linking with other strategic plans
  • development of a core dataset.

Guidance on utilising JSNA to provide insight into local commissioning,
publishing and feedback can be found at (

The JSNA provides a framework to examine all the factors that impact on
health and wellbeing of local communities, including employment, education,
housing, and environmental factors. Local authorities and PCTs can build on this
core dataset, using clearly defined criteria to select additional, high quality
and locally relevant information that provides a clear picture of their area.
Examples of strategies and plans linking to JSNA:

  • PCT and Local Authority commissioning strategies
  • PCT Local Delivery Plans
  • PBC commissioning plans
  • Local development plans
  • The Children and Young People’s Plan (CYPP)
  • Community regeneration strategies
  • PCT Pharmaceutical Needs Assessments
  • Supporting People strategies
  • Housing strategies
  • Community safety strategies
  • Carers strategies
  • Workforce planning strategies

The JSNA Core dataset can be found at (

Commissioning: Many of the current changes taking place in the NHS are
dependent on a strong commissioning function. Service redesign will in many
cases be dependent on effective commissioning, so it is vital that commissioners
have access to tools and expertise that will help them to commission
high-quality care.

The World Class Commissioning (WCC) programme launched in 2007, is a key
mechanism for PCTs to improve the quality and personalisation of healthcare
(adding life to years) while improving life expectancy and reducing inequalities
(adding years to life). WCC is the underlying delivery vehicle for High
Quality Care for All
and introduced 11 organisational competencies that set
out the knowledge, skills, behaviours and characteristics commissioners need to
turn the Governments vision into reality. Each competency has sub-components
with more detail (

Practice-based commissioning is a reform designed to give GPs and practice
nurses more say in how the NHS provides services for patients. Practice-based
commissioners, working closely with PCTs and secondary care clinicians, lead
work on deciding clinical outcomes. GP practices are provided with an ‘indicative’
budget, to spend on secondary services, with the intention that they will
reflect their patients preferences, with a greater variety of services and
convenience for patients.

NHS Operating Framework: New approaches to planning and managing NHS
priorities both nationally and locally have been introduced in this guidance
known as ‘vital signs’. The vital signs can be used to develop local
operational plans to deliver against national priorities and inform your
decisions on local targets. Operational Plans National Planning Guidance and
“vital signs” (2008)
sets out how to manage performance against the
three tiers of the “vital signs” which contain 31 indicators which form part
of the National Indicator Set from which the LAA targets will be drawn. PCTs
need to agree in consultation with local partners which of those local
priorities for health, recognised in their joint strategic needs assessment,
should contribute to the LAA, although these priorities will directly inform the
indicators they choose to recommend from the NIS.

The diagram below illustrates how the JSNA links to commissioning processes.

Source: (

Undertaking Health Service Planning

Who is involved?

Planning is concerned with change and the prospect of change inevitably
brings opponents and supporters of the proposal. The relationship between
planners, policy makers, service-managers, communities and other stakeholders in
the planning process is critical to the success of planning. A significant
number of health planners are drawn from health professions e.g. medicine,
nursing, and public health, however one of the challenges today is not so much a
matter of trying to develop specialist health planners but rather that of
exposing a broad range of professionals to the importance and concepts of
planning in order that they can participate in the process. A second challenge
is to ensure that planning systems are designed and operated so as to provide
real (rather than token) input from communities and users in the planning

Many techniques are used to assess the importance of stakeholders’
influence including stakeholder analysis (see Theories
of strategic planning

What is involved?

The following diagram represents a cyclical set of activities frequently
found during a planning process. It can be described as a planning spiral, with
the end point of each cycle forming the start of the next cycle, but at a higher

The Planning Spiral (Green 2007:36)

Each stage is briefly described below with links to examples
in the field.

Situational analysis: involves assessing the present situation and

  • current and projected demographic characteristics of the population
  • physical and socio-economic characteristics of the area and its
  • analysis of the policy and political environment including existing health
  • analysis of the health needs of the population
  • services provided by non-health sector as well as health sector, focusing
    on facilities provided, their function and service gaps together with
    organisational arrangements
  • examination of resources in the provision of services including their
    current efficiency, effectiveness, equity and quality

The situational analysis needs to cover the whole of the health sector.

Example: The JSNA for Manchester (2008-13) builds on some of
the comprehensive needs assessment work already carried out in the City,
particularly in relation to the Children and Young People’s Plan and various
strategies for the local NHS and Adult Social Care. This JSNA has a strong focus
on health and well-being

Priority-setting: stage ensures that the priorities set are feasible
within the social and political climate and within the context of available
resources. Clear criteria are therefore required for the selection of priority
problems (see LAA), which reflect the goals, objectives and targets of the
organisations involved. In some situations it may be helpful to clarify first
what are not priorities (e.g. where local needs are low, where expectations
cannot be met or significant achievements have been made and needs are now less

Example: The Learning to Deliver briefing (West Midlands LGA)
identifies dimensions, criteria and tools for priority setting in Local
Strategic Partnerships and Local Area Agreements

Option appraisal: stage involves the generation and assessment of the
various alternative strategies for achieving the set of objectives and targets.
Options may be discarded at this stage due to high resource implications,
political or social unacceptability, or technical unfeasibility. The results of
this stage will be a list of preferred strategies or combination of approaches
which will then form part of the plan.

Example: Following two and a half years of work by Bristol,
South Gloucestershire and North Somerset Primary Care Trusts and North Bristol
NHS Trust, with service users, carers, staff, the three Local Authorities and
other stakeholders of a nurse-led residential and day care respite service, the
Joint Health Scrutiny Committee have agreed three options to agree the future of
this service. The consultation document demonstrates how to develop an options

Programming and budgeting: Programme Budgeting (PB) is an appraisal of
past resource allocation in specified programmes, with a view to tracking future
resource allocation in those same programmes. In addition, Marginal Analysis
(MA) is the appraisal of the added benefits and added costs of a proposed
investment (or the lost benefits and lower costs of a proposed disinvestment.
Together PBMA is a priority-setting framework that helps decision-makers
maximise the impact of healthcare resources on the health needs of a local

Example: PBMA in eight steps:

  • Step 1: Choose a set of meaningful programmes with which
    to work
  • Step 2: Identify current activity and expenditure in
    those programmes
  • Step 3: Be creative – consider possibilities for
    improvements and linkages in pathways and patterns of care within and
    between programmes
  • Step 4: Weigh up extra costs and increased benefits of
    the improvements that were thought of in Step 3
  • Step 5: Consult widely – there may be options,
    trade-offs and value judgements to explain
  • Step 6: Decide on the change and make the decision in
  • Step 7: Effect the change – this is the essence of
    management – making it happen
  • Step 8: Evaluate your progress – check that the
    anticipated costs, saving and outcomes actually materialised

To find examples from these steps see (

Implementation and monitoring: is an essential part of the planning
process which involves transforming the broad strategies and programmes into
more specific timed and budgeted set of tasks and activities and involves
drawing up more operational plans which can then be monitored.

Example: The JSNA Quality Assurance Toolkit provides a
framework for local partners to assess the JSNA process in a systematic and
rigorous way

Evaluation: provides the basis for the next situation analysis and is
an integral component of the process. Reflection upon whether the process has
enhanced joint working, the needs analysis has been sufficiently appropriate and
comprehensive and if there are any gaps or areas of concern that need further

Example: This Evaluation Report provides detailed findings
from the JSNA evaluation and offers recommendations to the ‘Be Birmingham
Partnership’ concerning potential ways to take forward its development of the
Birmingham JSNA

Using the Planning Spiral can help to focus on all aspects of planning into a
coherent, unified process. By planning within this structure, you will help to
ensure that your plans are fully considered, well focused, resilient, practical
and cost-effective. You will also ensure that you learn from any mistakes you
make, and feed this back into future planning and decision-making.

© Sally Markwell 2009


  1. Department of Health (2002) Delivering the NHS Plan next steps on
    investment next steps on reform
    London: Crown
  2. Department of Health (2008) Joint Strategic Needs Assessment Quality
    Assurance Toolkit
     NHS East of England
  3. Green, A. (2007) An Introduction to health planning for developing
    health systems
    Oxford University Press
  4. Greengross, P.; Grant, G.; Collin. E. (1999) The history and
    development of the UK National Health Service 1948 – 1999
  5. Ham, C (1999) Improving NHS performance: human behaviour and health policy
    British Medical Journal  319(7223): 14990-1492
  6. Mitton, C. and Donaldson, C. (2004)  Priority Setting Toolkit A
    Guide to the Use of Economics in Healthcare Decision Making
    London: BMJ Publishing
  7. Pencheon, D.; Guest, C.; Melzer, D.; and Gray, M.J.A. (2006) Oxford
    Handbook of Public Health Practice
    Oxford University Press
  8. Rathwell, T. (1987) Strategic Planning in the health sector Kent:
    Croome Helme
  9. Thomas, R.K. (2003)  Health Services Planning New York: Kluwer
    Academic Publishers