• Primary care trusts (PCTs), which currently commission and fund patients' treatment, will be replaced by clinical commissioning groups (CCGs) – local groups of doctors, who are mainly GPs. They will gradually be handed responsibility for £60bn of NHS funds. They, rather than PCT managers, will be the ones who decide what care is right for patients, advise them where to go to get the best treatment and pay the bills. But many GPs are worried that this dramatic extension of their power could also damage their relationship of trust with patients because they will become responsible for rationing care, which will generate inevitable tensions.

• The new NHS Commissioning Board will manage the CCGs and try to drive up quality of care. It is meant to be handed much of ministers' day-to-day control of the NHS, to reduce political involvement. Critics fear, though, that the board's regional offices will be very similar to the strategic health authorities (SHAs) that will disappear next year. Andrew Lansley, the health secretary, has said he intends to streamline the NHS but the new system will contain many thousands of new bodies.

• Public health – tackling problems such as obesity, smoking and alcohol abuse – will transfer from the NHS to local councils. They will have a specific remit to narrow widening health inequalities between rich and poor.

• Any hospital which is not already a semi-independent foundation trust will have to become one, ideally by 2014. They will compete for treatment contracts from CCGs. Health policy experts predict that CCGs could over time force the closure of units, or even entire hospitals, if they do not rate the care given there.

The "cap" on how much hospitals can earn from private patients will rise from as little as 1.5% to 49%, prompting fears of a two-tier service in which NHS patients have to wait longer than those who pay.

• Competition will be extended, and non-NHS groups – charities and private healthcare firms – will be able to bid for increasing amounts of work currently done by NHS staff.

"Any qualified provider" will see nine NHS services, including treatment of neck and back pain, opened up to competition from next month, with other areas to follow later.

• Campaigners fear a "rush to the bottom" on quality of care as new providers of services put in unrealistically low bids to win contracts, leaving patients dissatisfied. Ministers deny they want to privatise the NHS but health leaders fear growing privatisation is inevitable.