UK healthcare is under pressure. Despite the hard work of NHS staff across the country, during 2020 the number of patients waiting over a year for NHS treatment has doubled. As of October this year, the one-year NHS waiting list has over 110,000 patients on it.[1]
At the same time, the IFS has been forecasting government borrowing. They project it to reach £350bn in 2020, the highest peacetime level in three centuries. Consequently, they argue that taxes need to rise £40bn per year to hold the national debt stable.[2]
Combined, these two developments beg a question. What can we do to ensure UK healthcare stays on a sustainable footing, ensuring we offer patients a world-leading level of care, while the UK government budget is under severe financial pressure?
In seeking the answer, the Conservative Government must use all the tools in its repertoire.
Rising to the Challenge
One Nation Conservatism is built on the principle of giving a fair chance to all. Fair access to healthcare is a key part of this. As access to healthcare erodes, so too does the fair chance at life.
The UK population is aging and healthcare treatment is becoming more expensive. Demand for the NHS is rising. All this was true before COVID, but now the Government must contend with these issues alongside limited room for fiscal manoeuvre.
Fast and proactive patient treatment is an important factor in controlling healthcare costs. For example, an older patient who receives a timely hip replacement, or ‘bad back’-related physiotherapy, can stay productive and active later into life. This in turn reduces co-morbidity, and the consequent chance of a disease becoming chronic or further treatment being needed.
Given our challenge, and the importance of timely access to high-quality healthcare, we must look for easy and affordable ways to bolster UK healthcare while ensuring the NHS remains on track towards a sustainable future.
Insurance Reform
One effective way to help the NHS, with minimal cost to government, involves leveraging the existing UK private healthcare industry to help the vital work of the NHS.
There are many issues facing the NHS, but a main challenge is capacity. When the COVID crisis began in March, the private sector was relied upon – the Government bought up private sector beds en masse to provide overflow capacity for strained NHS hospitals. In normal times, however, the UK private healthcare system has capacity while the NHS struggles.
11% of the UK population has private health insurance coverage.[3] Policyholders are disproportionately young and healthy. However few policies offer maternity or mental health cover, and none cover A&E or routine general practice.
Those who are older and affluent find UK private health insurance to be cost prohibitive. It is littered with exemptions for pre-existing medical conditions, and there is normally no coverage for chronic medical conditions once they have been discovered in the policy term.
Financially able older citizens therefore have no choice but to use the NHS, and younger policyholders only have limited supplementary coverage. This means there are a significant number of citizens with the means and desire to use private health insurance – with the potential to free up NHS capacity for those who need it – but who cannot do so because of restrictive policy coverage.
This should change, in two ways.
First, the Government should outlaw pre-existing medical condition exclusions in UK private medical insurance. This would allow those who pay for private medical insurance to get private medical cover. At present, many pay for private medical insurance while the NHS foots the bill for patients’ regular check-ups. This does not make sense. If a patient is willing to pay for private medical insurance, they should get full coverage, alleviating the burden on the NHS.
Second, the Government should require all UK health insurance policies to offer (perhaps for a set surcharge) maternity, mental health and general practice cover. Maternity cover, in particular, is an area that many young policyholders are not covered for. This means pregnant policyholders cost the NHS money when they could be generating money through the use of private NHS maternity wings.
With these two simple reforms, it would open the UK private medical market up to those who wish to pay.
It would ensure the NHS stays available for those who need it, while opening another sustainable option up for those who are willing or able to pay for private medical insurance.
It would allow the young to receive full coverage and older citizens to afford private health coverage. It would help alleviate some of the capacity burden that the NHS is experiencing, while offering consumers greater choice of treatment.
All the while, none of this reform interferes with the great work the NHS and its staff do.
Simple reform of the private health insurance market in the UK could do much to help the NHS on its road to sustainability.
[1] https://www.telegraph.co.uk/news/2020/10/08/110000-patients-forced-wait-year-routine-nhs-treatments/
[2] https://www.ft.com/content/5eb22577-0e96-4f17-b741-c5c135290456
[3] https://www.kingsfund.org.uk/sites/default/files/media/commission-appendix-uk-private-health-market.pdf
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