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This paper draws on economic theory and empirical evidence in order to explore the role of incentives and information in the successful implementation of the new hospital funding system in the NHS.

The research is based on case studies in two strategic health authorities comprising in‐depth interviews with key stakeholders and analysis of background statistics and documentation.

The structure of tariffs under payment‐by‐results (PbR) provides high‐powered incentives for providers to increase activity because they are rewarded for hospital activity, and payments for increases in activity are made at full average cost. However, there is a danger that hospitals will increase activity beyond affordable levels and possibly induce demand inappropriately.

In future, as PbR is extended, it will be important to monitor its intended and unintended effects. Such evaluation should consider the extent to which commissioners are able to live within their budgets and whether hospitals are engaging in opportunistic behaviour and gaming the new funding system.

This study has shed light on the incentive structure of PbR for NHS organisations and has provided insights for the development of information strategies for providers and commissioners in the NHS market. It also highlights a number of policy issues that need to be addressed as PbR is rolled out nationally as well as several important gaps in knowledge that are in need of more sustained investigation.

The purpose of this research is to examine the issues of decentralisation in the NHS.

Evidence was gathered from an empirical study in order to illustrate the effect of policy reform on relationships at both the central and the local level. In this paper issues were examined in the context of two reforms at the heart of the decentralisation agenda in the English NHS: earned autonomy and the introduction of foundation hospitals.

Past and current policy in the NHS reflects elements of both centralisation and decentralisation. The tension created by such opposing forces has an impact not only on inter‐organisational partnership working but also on the balance of power within local health economies.

Attempts to control the NHS exhibit unresolved contradictions and tensions. This research showed that the challenge for policymakers, managers and clinicians is to manage such tensions.

The purpose of this paper, based on a nation‐wide survey, is to explore how clinical governance managers in the English NHS are seeking to engage with the culture(s) of their organisation to support quality improvement.

All English NHS primary and acute trusts, a total of 325, were contacted for R&D approval between March and September 2006. Clinical governance leads of organisations which gave their approval, 276 (or 85 per cent), were targeted in a nation‐wide postal survey between October 2006 and February 2007. A response rate of 77 per cent was obtained. The questionnaire contained mostly closed questions about the role and importance of culture in clinical governance and the use of tools for culture assessment. The questionnaire was piloted with eight respondents, seven in clinical governance from both primary care and acute trusts, and one from the National Patient Safety Agency. Useful feedback was received from five of the respondents, which was used to revise and refine the questionnaire. Confidence in the reliability and validity of the results is based on a high degree of consistency and similarity in the responses, both with respect to a few questions which were closely related and the two categories of respondents from primary care trusts and acute trusts.

There was found to be clear interest among clinical governance managers in culture renewal and management, in line with the growing national policy interest in promoting culture change as a lever for health system reform. Nearly, all clinical governance managers (98 per cent) saw the need to measure local culture in order to foster change for improved performance; 85 per cent, indicated that culture assessment should satisfy a formative purpose, whereas 64 per cent believed that it should serve summative ends. While nearly all clinical governance managers (99 per cent) acknowledge the importance of understanding and shaping local cultures, the majority are also conscious that there are many challenges to overcome in their efforts to implement and sustain beneficial culture change.

This research highlights the widespread practical interest in assessing and managing local health care cultures to support clinical governance and quality improvement activities. It also highlights the need for culture assessment tools that better reflect the needs and interests of clinical governance managers.

An increasing amount of data on the quality and clinical performance of NHS hospital Trusts is entering the public domain, however there has been no research looking at how this information is used by general practitioners. A telephone questionnaire survey using a random sample of general practitioners found that less than a quarter of general practitioners used published clinical outcomes data to inform their assessments of the quality of hospital services. Only a small proportion discussed these data with their patients. Nevertheless, some latent demand for this type of information was detected. Those responsible for publishing such data should develop data sets and design dissemination strategies that are capable of engaging the attention of general practitioners. Given the sheer volume of information targeted at general practice it is advisable that the views and opinions of general practitioners are incorporated in future developments.

The questions addressed by this review are: first, what are the guiding principles underlying efforts to stimulate sustained cultural change; second, what are the mechanisms by which these principles operate; and, finally, what are the contextual factors that influence the likelihood of these principles being effective? The paper aims to discuss these issues.

The authors conducted a literature review informed by rapid realist review methodology that examined how interventions interact with contexts and mechanisms to influence the sustainability of cultural change. Reference and expert panelists assisted in refining the research questions, systematically searching published and grey literature, and helping to identify interactions between interventions, mechanisms and contexts.

Six guiding principles were identified: align vision and action; make incremental changes within a comprehensive transformation strategy; foster distributed leadership; promote staff engagement; create collaborative relationships; and continuously assess and learn from change. These principles interact with contextual elements such as local power distributions, pre-existing values and beliefs and readiness to engage. Mechanisms influencing how these principles sustain cultural change include activation of a shared sense of urgency and fostering flexible levels of engagement.

The principles identified in this review, along with the contexts and mechanisms that influence their effectiveness, are useful domains for policy and practice leaders to explore when grappling with cultural change. These principles are sufficiently broad to allow local flexibilities in adoption and application.

This is the first study to adopt a realist approach for understanding how changes in organizational culture may be sustained. Through doing so, this review highlights the broad principles by which organizational action may be organized within enabling contextual settings.

The National Health Service (NHS) Local Improvement Finance Trust (LIFT) programme was launched in 2001 as an innovative public‐private partnership to address the historical under‐investment in local primary care facilities in England. The organisations from the public and private sector that comprise a local LIFT partnership each have their own distinctive norms of behaviour and acceptable working practices – ultimately different organisational cultures. The purpose of this article is to assess the role of organisational culture in facilitating (or impeding) LIFT partnerships and to contribute to an understanding of how cultural diversity in public‐private partnerships is managed at the local level.

The approach taken was qualitative case studies, with data gathering comprising interviews and a review of background documentation in three LIFT companies purposefully sampled to represent a range of background factors. Elite interviews were also conducted with senior policy makers responsible for implementing LIFT policy at the national level.

Interpreting the data against a conceptual framework designed to assess approaches to managing strategic alliances, the authors identified a number of key differences in the values, working practices and cultures in public and private organisations that influenced the quality of joint working. On the whole, however, partners in the three LIFT companies appeared to be working well together, with neither side dominating the development of strategy. Differences in culture were being managed and accommodated as partnerships matured.

As LIFT develops and becomes the primary source of investment for managing, developing and channelling funding into regenerating the primary care infrastructure, further longitudinal work might examine how ongoing partnerships are working, and how changes in the cultures of public and private partners impact upon wider relationships within local health economies and shape the delivery of patient care.

To the authors’ knowledge this is the first study of the role of culture in mediating LIFT partnerships and the findings add to the evidence on public‐private partnerships in the NHS.

Mainstream health economics labours under a misleading understanding of the nature of the topic area and suffers from a concomitant poverty of thinking about theory and method. The purpose here is to explore this critical position and argue that health economics should aspire to being more than a technical discipline. It can, and should, engage with transformative discourse.

It is argued that the hermeneutic sciences, emphasising interpretation not instrumentality or domination, offer a route into the change to which one seeks to contribute. The article specifically focuses on the way Habermas provides insights in his approach to knowledge, reason and political economy. How he emphasises complexity and interaction within cultural milieu is explored and primacy is given to preserving the life‐world against the encroachments of a narrow rationalization.

The argument for a critical re‐imagining of health economics is presented in three stages. First, the antecedents, current assumptions and critical voices from contemporary economics and health economics are reviewed. Second, the way in which health is best understood via engaging with the complexity of both the subject itself and the society and culture within which it is embedded is explored. Third, the contribution that hermeneutics, and Habermas's critical theory, could make to a new health economics is examined.

The paper offers a radical alternative to health economics. It explores the shortcomings of current thinking and argues an optimistic position. Progress via reason is possible if one reframes both in the direction of communication and in the appreciation of reflexivity and communality. This is a position that resonates with many who challenge prevailing paradigms, in economics and elsewhere.