Private medicine in the UK

Private medicine in the UK, where there is universal state-funded healthcare, is a small niche market. Private provision of services for patients who pay (or whose insurers pay) should be distinguished from private providers who are paid by the NHS for services which are, as far as the patients are concerned, free.

Demand

According to LaingBuisson in 2018 the total private acute healthcare market is worth £1.47 billion (not including consulting or diagnostic work outside hospitals) and 40% of the demand is in London. NHS trusts in London increased their income from private patient units by 8.1% to £360 million in 2016 and now had a majority of the business of providing healthcare to embassies based in London. 18 trusts in London now have private patient units.^[1]

The inability of the NHS to meet waiting time targets for planned surgery led to an increase in the numbers paying personally for private operations. Personal payment for acute medical care increased by 53% between 2012 and 2016, from £454 million to £701 million, not including cosmetic surgery or costs covered by health insurance. This was particularly marked in orthopaedics and cataract surgery where NHS treatment was increasingly rationed. ^[2]

History

The Royal Commission on the NHS reported on private medicine in the UK in 1979.^[3] Their report included:

• Registered private hospitals, nursing homes and clinics, some of which also treat NHS patients on a contractual basis;
• private practice in NHS hospitals, including treatment of private in-patients (in pay beds), out-patients and day-patients;
• private practice by general medical practitioners, general dental practitioners, and other NHS contractors, including opticians and pharmacists, who provide NHS services but usually also undertake retail or other private work;
• private practice outside the NHS undertaken by medical and dental practitioners, and other staff such as nurses, chiropodists and physiotherapists, who are qualified for employment in the NHS but choose to work wholly or partly outside it;
• treatment undertaken by other practitioners not normally employed in the NHS, such as osteopaths and chiropractors.

Expenditure on private health care in the UK in 1976 was estimated at £134 million not including abortions, long-term care, or dentistry. That was about 3% of total expenditure on health care in the UK. At that time about 2% of all acute hospital beds and 6% of all hospital beds in England were in private hospitals and nursing homes. The proportions in the rest of the United Kingdom were lower.

As part of a drive to extend the choice of providers available to patients, the Thatcher government aimed to expand the provision of private medical insurance by providing tax relief to people over-60.^[4]

Private income for NHS trusts

When NHS foundation trusts were established they were required to limit the proportion of their private income to the level it had been in 2006. For many this was zero. The average across England was 2%, but levels at teaching hospitals, especially in London, were considerably higher. 18 NHS hospitals in London run wards for private patients. The Health and Social Care Act 2012 permitted Foundation trusts to raise their private income to 49% of the total. Only The Royal Marsden NHS Foundation Trust, which hopes to raise 45% of its income from private patients and other non-NHS sources in 2016/7 and is trying to raise its income from paying patients from £90m to £100m,^[6] is any where near the 49% limit.

The Imperial College Healthcare NHS Trust and Moorfields Eye Hospital NHS Foundation Trust have both opened clinics in Dubai. There are some joint ventures between NHS trusts and private providers. HCA Healthcare has run a specialist private cancer unit in partnership with the Christie NHS Foundation Trust in Manchester since 2010. About 25% of patients using private services came from overseas.^[7]

NHS use of the private sector

The 1997 Labour Party manifesto made a specific commitment to end the Conservatives’ internal market in health care, but in government they retained the split between purchasers and providers of healthcare. In 2000 the Labour Government agreed A Concordat with the Private and Voluntary Health Care Provider Sector with the Independent Healthcare Association.^[8] The intention was to increase capacity, particularly in elective care, where private provision was used to bring down waiting lists, in critical care, and in intermediate care facilities. This was followed, in April 2002,by the introduction of prospective payment with nationally set prices for acute, elective activity under ‘payment by results’.^[9] Under patient choice, patients could opt for treatment by a private provider paid by the NHS. The NHS Plan led to the development of independent sector treatment centres which provide fast, pre-booked surgery and diagnostic tests for NHS funded patients separating scheduled treatment from emergency care. These centres played a role in reducing the price paid for ‘spot purchases’ with private providers. Previously when the NHS had made use of the independent sector on an ad hoc basis, it often paid 40-100% more than the equivalent cost to the NHS. The NHS Improvement Plan: Putting people at the heart of public services, published in 2004 there was an expectation that the independent sector would supply up to 15% of NHS services by 2008, but this figure was not reached.^[10]

Rules to prohibit NHS consultants from charging "Top up fees" to NHS patients for extra services were clarified in 2008 to make it clearer that paying for chemotherapy treatment not available on the NHS would not prevent patients from subsequently accessing NHS treatments.^[11]

When the coalition government introduced what became the Health and Social Care Act 2012 it appeared to pave the way for a bigger role for private companies,^[12] but the impact of austerity on NHS budgets meant that take up of private capacity was low. In September 2018 it was said that the private sector in England had capacity for around 100,000 additional inpatient procedures in the last six months of 2018-19. Although NHS waiting lists had risen significantly there did not appear to be any concrete plans to employ private providers to reduce it. Since early 2017 private provision had been steadily about 6% of the total NHS caseload for elective surgery according to NHS Gooroo.^[13]

Mental Health

Private provision of psychiatric beds has been largely financed by the NHS, as few psychiatric patients have the means to finance their own treatment and health insurance does not often extend to mental health. 1,700 beds were closed by NHS mental health trusts from 2011 to 2013. As a result, large numbers of patients are admitted in crisis to private institutions, often in remote locations. The cost is around £500 per day.^[14]

Any Qualified Provider

Any Qualified Provider was a government policy intended to encourage all NHS, private, third sector or social enterprise health service providers to compete for contracts on an equal footing. ^[15]

Performance

One of the criticisms of private care has been that private providers are not required to produce sufficient information about their services to permit comparison with NHS services.^[16] It is suggested that surgery in private hospitals may be dangerous because of inadequate equipment, lack of intensive care beds, unsafe staffing arrangements, and poor medical record-keeping.^[17]

The Care Quality Commission reported in April 2018 that 30% of the 206 independent acute hospitals required improvement, mostly because of a lack of formalised governance procedures.^[18]

Information about performance is collected by the Private Healthcare Information Network.

Controversy

The issue of privatisation of health services was an issue in the United Kingdom general election, 2015. The government's position was that "Use of the private sector in the NHS represents only 6% of the total NHS budget - an increase of just 1% since May 2010".^[19] It is unclear what this statement meant. Some NHS services, such as dentistry, optical care and pharmacy, have always been provided by the private sector and, technically, most GP practices are private partnerships.^[20] All the drugs, supplies and equipment used by the NHS are privately provided. Taken together this amounts to around 40% of the NHS budget. In addition some NHS organisations subcontract work to private providers. The NHS accounts for 2013/4 show that £10 billion of the total NHS budget of £113 billion was spent on care from non-NHS providers. The main growth in private provision has been in mental health and community health services.^[21]

See also

• Health care in the United Kingdom

References