In this video interview, Professor Andrew Street, Professor of Health Economics at the University of York, discusses future reform of the NHS payment system as the Government prepares to introduce major changes to the way health services are organised and delivered in the NHS in England.

Professor Street explains how the NHS payment system works and why it matters; discusses what changes are needed to help the NHS achieve the unprecedented efficiency savings that are required; assesses whether GP consortia will be strong enough to resist the strong incentives for hospitals to continue treating more and more patients; and explores the role of Monitor and the NHS Commissioning Board in setting prices and monitoring hospital activity.

Speaking with Nuffield Trust Chief Economist Anita Charlesworth at the Nuffield Trust's 2011 Health Strategy Summit, Professor Street gives his assessment of the lessons that can be learned from the payment by results system. He concludes that hospitals have been incentivised to treat higher volumes of patients, which has helped to drive down waiting times, but that there has yet to be a wide-scale substitution of hospital care for care delivered in primary and community care settings.

For further information, visit the Nuffield Trust website: nuffieldtrust.org.uk.

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