UK’s NHS is Broken: Is Private Medicine the Answer?

With increasing health care demands and capacity constraints, does private health care offer a better alternative to universal social insurance schemes? Or, does private health care simply put profits before patients? The authors dive deep to make sense of it all.

LONDON, UK – July 2021: NHS National health service logo with saving piggy bank © Ink Drop /

October 26, 2022 02:04 EDT

Universal Health Care (UHC) developed shortly after World War II, especially in the United Kingdom, mainland Europe, Canada, Australia and New Zealand. It has two main principles. The first is cradle-to-grave health care funded by or on behalf of the state for all citizens regardless of age, status, income or means, and either subsidized or free on demand at the point of care. The second is that the source of state funding derives from the population and employers. This may be sourced through general taxation or, more usually, a combination of general taxation to fund capital and payroll demands, complemented by compulsory national social insurance or a nominated health insurer for all those of working age. The required funds are typically deducted from wages at the source. Thus, in principle, UHC is an attempt to defray total health care costs evenly and fairly across the population.

Hand-in-glove with UHC is the establishment of a National Health Service (NHS) charged with delivering it. There is no set template for an NHS and different countries have developed different schemes, all with greater or lesser involvement of state or state-backed insurance schemes and patient contributions. In general, NHS systems have proven effective in their provision and very popular with patients. There is little evidence of patients being unable to obtain care owing to inability to pay or denial of insurance, since coverage is a statutory requirement. However, most countries continue to face NHS challenges arising from aging populations, increased demand, pandemic crises, staff shortages, and new and often expensive treatments. In some countries, especially the UK, such challenges have translated into chronic delays in treatment and long waiting lists, often running into years.

Universal Health Care versus Private Provision

Some countries have eschewed UHC, the most prominent being the US, which by far spends the most per capita on health care, some US$3.6 trillion in total in 2018 or US$11,172 per person. This represents at least 1.5 times that spent per capita by European countries. Despite such expenditure, timely treatments, full staffing, and the latest technology, the US ranked only 22nd in the global list of effective health care outcomes. There are many reasons for this discrepancy (e.g. OECD 2015; Dorn’s classic 2008 study), including a highly fragmented non-national system and differential standards, insurer disavowal of cover for certain conditions, and patient inability to pay premiums owing to poverty or unemployment. US Census data for 2016 showed that some 28.1 million citizens had no health care insurance. Over the next three years, the figure remained relatively static and by 2020 it was still 27.96m or 8.6% of the population.

Thus, it may appear that, ideologically speaking, there exist two directly opposed approaches to health care – UHC and private provision. While in UHC countries there has always been a degree of private health care, the standard expectation and culture is that “UHC rules.”  However, the pressures to accept greater private provision have grown inexorably, and especially in countries such as the UK that have elected radical-right governments continuously since 2010. Privatization of the NHS has always been an ultimate objective of the Conservative (Tory) Party since 2010. At the same time, Tory governments have deliberately masked and downplayed their intentions, owing to the population’s jealous ownership of “their” NHS and the risk of political suicide for any party openly advocating dismantling the NHS. Ironically, while the UK radical-right government has been keen to introduce a US-style private health care provision, in the US there have been growing calls for UHC as a means to counter the worst characteristics of a US system that many perceive as broken.

Rather than seek to answer the question ‘which approach is best?’, this article presents a case study of one example of the tensions between the two competing ideologies. 

70+ Years of the UK’s National Health Service

The National Health Service Act 1946, which came into effect in July 1948, had as its underlying principle the provision of health care universally available to all and free at the point of use. While 74 years later that principle remains the public mantra of all mainstream political parties in the UK, nevertheless Conservative governments since 2010 have initiated an accelerating drive to change  its fundamental structure, funding and delivery of health care. These changes are encapsulated in the new Health and Care Act 2022. Services ‘free at the point of use’, while still guaranteed, are now open to much greater private competition. 

Will this result in private fee-based provision, currently a lesser part of the existing two-tier health service provision, potentially overtaking free NHS delivery? This has already emerged in dentistry, for example, where so many dentists have quit NHS provision to go private that some localities no longer have a single NHS dentist. Will general practitioner (GP) practices follow the same pattern, or will they cater for both NHS and private patients but with an access and delivery bias towards private patients? Other high demand, low provision services, such as podiatry, physiotherapy and mental health, are under similar threat of a private practice bias.

Continuously increasing pressure on NHS finances and resources have provoked these changes that correlate with a variety of convergent causes. First is demographic changes, such as population increase and an increasing proportion of the elderly. The emergence of  many more effective but often expensive treatments has seen the rise of more demanding patient expectations in a society of ‘consumerist entitlement,’ fed on internet and social media information. Then there is a long-term trend that has produced a shortfall in medical staff and state funding And, of course, the Covid crisis has added to the woes of an NHS creaking at the seams. Long-term underfunding of the NHS has led to long waiting times, and created pressures for private care as a solution. NHS commissioners are now compelled to increase contracted provision and, under political direction, to choose private contractors.

Governments face the dilemma of maintaining and improving health care provision in line with medical advances and public demands, while finding ways to pay for it all. UK political parties and the health care professions concur that the ‘old model’ NHS is no longer fit for purpose. However, will the model of the new 2022 Act produce the promised ‘salvation’ the present government asserts? Or, will it degenerate into a “dog’s dinner:” a dysfunctional, systemic mess from which the only beneficiaries will be private doctors and surgeons, insurers, private corporations, their investors, and financially secure patients, while the mass of patients without adequate finances will be taken back to a primitive pre-NHS reality on a par with third-world health care?

A Climate of Amoral Calculation

Right-wing politicians in the UK reflexively insist on pushing for greater private funding and provision of services, arguing that a wholly publicly funded and run health service is bound to be cost-inefficient, top-heavy with administrators, unwieldy, and unresponsive to changing contexts and needs. Private health care providers, they argue, are much faster and more cost-efficient. Such providers, they assert, are entitled to be profitably paid for their services and, as respectable and ethical enterprises, they would never extract excessive profits or engage in any underhand or lazy practices to the detriment of patients. Unfortunately, in practice the evidence shows that all are not such paragons of virtue.

Examples are legion. The private sector – including many of the contractors to the NHS – has come in for considerable criticism. Especially egregious practices include the failure to address adequately and resolutely growing evidence over several years of mass clinical fraud, negligence and cover-up. The notorious case of Ian Paterson –  a surgeon jailed for 20 years, who for over 14 years falsely diagnosed healthy patients as having cancers requiring mastectomies –  resulted in “well over 1,000” unnecessary breast removals at two Spire private clinics and three NHS Hospitals. The Paterson Inquiry Report in 2020 found that the managements of these hospitals had a “culture of avoidance and denial” and exercised willful blindness to mounting evidence and ‘whistleblower’ reports. It concluded that the private clinics had not demonstrated that they were yet capable of meeting the high standards required. It recommended a new more stringent regime for all such facilities.

Of course, this does not mean that all private health care provision is incompetent, poor value for money, fraudulent, or worse, damaging or dangerous for patients. Nor does it mean that the long-standing public/private partnership arrangement that characterizes the NHS cannot and should not continue both in principle and in practice, so long as there are stringent monitoring, control and independent auditing systems in place, reinforced by both NHS and government determination to stamp out unethical, harmful and, especially, criminal conduct.

Therein lies the rub. It has become abundantly clear that throughout the life-cycle of private contracting to the NHS, from bidder approval, tendering, terms and conditions, pricing, award decision and onwards to delivery and termination, “light touch” laissez-faire oversight predominates. Moreover, one is left with a feeling that a cozy “turning a blind eye” collusion exists whereby a culture driven by the strategy of “what can we get away with?” has been allowed to develop. A pursuit of profit above all other considerations encourages, if not ensures, a heavy reliance on amoral calculation by some of those engaged in private health care.

Who Are the Private Companies?

In the public’s perception, the most visible and longstanding private healthcare companies are those established by medical expenses insurers, such as BUPA, AXA, and PHP. The major ‘medex’ insurers have also acquired hospitals and GP group practices. Many citizens receive free private health care from such companies as a result of employee benefit schemes, although, increasingly, others are prepared to pay from their own pockets. A disincentive for self-funders is that annual premiums increase markedly with the insured’s age and tend to become prohibitive by late middle-age, especially if claims experience is poor. Premium renewals are heavily affected by “claims made” e.g. operations, treatment for serious illness, or frequent consultations. Thus, typically cover for self-funding individuals is for ‘major medical only’ while excluding routine GP-type provision. Nevertheless, via the 2022 Act the government clearly intends to encourage, if not persuade, the mass of patients to acquire private medical insurance, and this would include cover for GP services.

Other major corporations operating in the UK health care sector include Spire (now owned by the Australian company Ramsay Health Care), Circle, and HCA, which run extensive networks of private hospitals and clinics. They are high-profile bidders for NHS clinical provision contracts, although following Circle’s business failure in 2015 of its management franchise running of the NHS Hinchingbrooke Hospital, such major ‘whole facility’ contracts are less likely.

However, many other companies, often foreign-based, operate in the UK private health care sector that contract services to the NHS unobtrusively. Ownership of GP services, typically group practices, by private corporations (often US-based) rather than the GPs themselves, has become increasingly commonplace. These include Centene, Babylon, Operose, Livi, SRCL, and First Practice Management. Continuing corporatization for profit, if not strictly controlled, would totally undermine the ‘not-for-profit’ foundation of the NHS and enable excessive extraction of profits by foreign beneficiaries.

GP Services in Privatization’s Crosshairs

According to the King’s Fund research body, the amount spent by the NHS on private sector delivery overall in 2019-20 totaled £14.4bn, much higher than the £9.7bn shown in the Department of Health and Social Care’s accounts, since the latter excluded a number of categories including GPs and other primary care services.

For several reasons, GP services have become the new target for private corporations. One is the fact that, whereas the public may imagine that GPs are employees of the NHS, in fact GPs have always been private outsourced contractors to the NHS, working on “contracts for services” and not “contracts of service.” Another is that GP patient lists –  the basis of NHS payments to GP practices –  are growing. In addition, new GP numbers continue to fall while many experienced GPs are quitting early, long before normal retirement, or going part-time, owing to feeling overworked, under-paid and under-valued. One in six GP posts remains typically vacant for long periods. Both the Nuffield Trust and the BMA report that in some cities there are now fewer than 50 GPs per 100,000 patients, or 25% more patient load per GP than the accepted NHS ‘safe’ ratio. According to NHS data, GPs typically now have 2,500 patients each instead of 1,600, and in some cases over 6,000.

Increased demand and decreased provision establishes an attractive context for private corporate acquisition of group GP practices running perhaps half-a-dozen or more surgeries, typically in urban locales. Their business model is to move away from traditional face-to-face consultations with an attentive, caring “usual” GP, and replace them with remote online and phone consultations randomly from a bank of GPs. The Covid crisis and avoidance of face-to-face appointments presented an unexpected opportunity to introduce and test the new model in practice as an operational and regulatory necessity. As a result, some patients (including the authors) have not seen their usual, or any, GP since 2019. This loss of face-to-face access risks damaging accurate and timely diagnosis. The cross-party Health and Social Care Committee of the House of Commons has examined the future of GP services. Its latest parliamentary report is highly critical of the degenerating GP experience for many patients, which has resulted from this new business model.

Profits Before Patients

With corporate-owned GP practices, emphasis on extraction of profits increases at the expense of reinvestment into, for example, additional GPs, nurses, ancillary staff, and improved phone call handling systems. These are  needed to cope with increased patient demand by enforced remote access in an ‘online and phone only’ health care environment. For example, Operose Health UK, the UK’s largest group of GP practices and owned by the US Centene corporation, has some 600,000 NHS patients. In June 2022, BBC Panorama ran a damning undercover investigation report, alleging that patient referral documents remained unread for months and that Operose routinely used poorly supervised ‘physician associates’ as less qualified but cheaper substitutes for fully qualified GPs.

In a group of six GP practices owned by another hierarchy of corporate owners in a South Coast city, patients (including the authors) typically experience up to a 1 hour or more wait in phone queues for routine access, only to be cut off by a time limit. Their online e-consult facility also has a daily quota and time cut-off, thereby similarly forcing patients into an unwelcome and stressful ‘first come, first served’ competition with each other. Often, the e-consult facility is unavailable for days at a time. In response to a formal complaint about its dysfunctional call handling system, the practice”s management stated in writing that a decision had been taken to “reduce the number of phone lines into the center” so as to save patients’ money caused by long waits. It added, “we are not currently looking to change this decision.” Investing in an improved phone and call handling system appears trumped by the focus on profit extraction.

Moreover, the ultimate ownership of such practices is usually impossible to establish, owing to intricate layers and networks of corporate shareholdings that block transparency. Similarly, determining just how much profits are being taken is almost impossible, as many avoid filing full UK accounts by using subsidiary account rules. Intentional opacity is a salient characteristic of such companies.

The next logical step by corporately-owned GP practices is likely to be to an expansion of a “private patients only” regime, whereby consultations, treatments, blood tests, vaccinations etc will all be fee-based and no longer fall within the free NHS provision. This move will follow in the footsteps of UK dentists, many of whom have withdrawn from NHS provision. Thus far, the withdrawal of GPs as NHS contracted providers is a minority, but the trend is likely to accelerate as more GP practices are acquired by profit-driven companies. The prospect of having to pay for GP services will hit the poorest, and, for many, it may deny them the “provision of health care universally available to all and free at the point of use” warranted by law for over 70 years.

Private health care take-up has been increasing, especially via employment benefit schemes and particularly by those in the 20-40 age group who are more willing to self-fund insurance premiums or fees. They tend to perceive private health care as an essential commodity, comparable to other lifestyle purchases, such as online multimedia packages, Netflix, and expensive gym subscriptions. However, the big risk is that in times of economic downturn or cost-of-living crises, such necessities will be dispensed with as unaffordable luxuries. 

Is the NHS Safe in Tory Hands?

Despite the Conservative government’s Health and Care Act 2022, which is reassuringly intended to ‘reform’ the NHS and its provision, including a much greater emphasis on private sector outsourcing, concerns abound. One is that its main impact will be to sanctify in law private profit at the expense of patient health care, while exempting delivery from standards of public responsibility and proper accountability. A detailed study by Goodair and Reeves published in The Lancet in July 2022 showed that over the period 2013-2020 “private sector outsourcing corresponded with significantly increased rates of treatable mortality, potentially as a result of a decline in the quality of health-care services.”

Thus far, the public seems unaware of this new stealth assault – literally “hidden in plain sight” – on what they still imagine will continue to be a guaranteed free-at-the-point-of-use NHS. Not that they don’t care. Few have heard about the changes. Fewer still know about the scope, scale, content and impact the 2022 Act will have on them as patients. As the truth dawns  – that perhaps the NHS is not safe in this particular government’s hands and that patients may increasingly find that they will have to pay for GP services among others – it is likely to become a major general election issue. The government and NHS will have a tough job ‘selling’ this new regime to the public, and any hint of ‘economy with the truth’, deception, outright lies, or brazen confidence trickery will prove unwise.

Increasing corporate ownership of GP services could be made to work satisfactorily for patient care, but that would require new stringent criteria and robust monitoring, control and transparency arrangements that are currently missing. These would include: (a) complete transparency of GP ownership and accounts; (b) independently audited publicly available accounts of GP practices; (c) regular independent audits of management and clinical provision by GPs. 

Rigorous assurance of contract compliance will be crucial. The Care and Quality Commission will not be robust enough for these audit tasks. If it is to provide any benefit let alone maintain its credibility, the level of independent auditing (and corrective action) cannot be ‘tick the box’ or appear as superficial ‘window dressing.’.

Failure Is Not an Option

The 2022 Act is one heck of a gamble. The larger and more complex any system is, the higher the likelihood of dysfunctionality or even total failure. In particular, if the new ICBs (Integrated Care Boards) fail, that alone could result in an end of the NHS. The headline preventive elements that may be required –  but thus far are not evident –  include:

  • Compulsory liability/surety bonds amounting to, say, 10% of pre-tax turnover imposed on all corporate entities and their individual board members that seek to provide services to the NHS. This is to focus their attention on their duty-of-care obligations and the penalties for failure.
  • Compulsory fit-for-purpose registration and competence certification of all insurance entities and their professional and sales staff engaged in offering Private Medical Expenses Insurance. This is to deter fly-by-night opportunists and scammers.
  • Regular compulsory independent validation and verification audits (to national criteria, standards and certified auditors) of all corporate policies, strategies, operations, and management systems, in relation to contracted provision of services to the NHS, including GP services. This is to provide systems assurance that requirements are appropriate and are in fact being implemented, and to counter the “what can we get away with?”tactic.
  • Regular review of speed of implementation and effectiveness of remedial recommendations in compulsory audit reports. This is to ensure that remedies for system defects are in fact implemented promptly and effectively, and to counter the ‘what can we get away with?”attitude.
  • Legal penalties for corporate wrong-doers (both organizations and individuals), including, say, 10% of pre-tax profits and where appropriate (according to the nature and scale of the offense as well as repetition), jail sentences, and/or fines, asset confiscation, compensation orders, directorship bans, and compulsory “name-and-shame” orders. This is to ensure that duty-holders are made accountable for serious offenses.

While some legal difficulties in imposing such controls exist, these must be overcome so as to prevent abuses that favor private contractors while harming patient health care, personal finances, taxpayers, and public trust and confidence in government. Analogues for such tough controls exist. For example, following years of uncontrolled public harm by cavalier online and social media platform owners, the Online Safety Bill will likely impose a number of broadly similar controls on such companies and senior executives. In health care, the government must place the emphasis on prevention and fairness now, rather than on future corrective reaction to malpractice or malfeasance. Failure to do risks  fomenting widespread social discontent and even public disorder. The UK experience should also provide a salutary warning to other countries.

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

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