Private medicine in the UK, where
universal state-funded healthcare is provided by the
National Health Service
The National Health Service (NHS) is the umbrella term for the publicly funded healthcare systems of the United Kingdom (UK). Since 1948, they have been funded out of general taxation. There are three systems which are referred to using the " ...
, is a
niche market.
The provision of private healthcare has created a significant reduction in waitlists for certain users.
However, this has opened up opportunities for private investments in the form o
crowdfunding
Demand
According to
LaingBuisson
LaingBuisson is a business intelligence provider across health, care and education, headquartered in Angel, London. It provides insights, data and analysis of market structures, policy and strategy and is the chosen provider of independent sector h ...
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 trust
An NHS trust is an organisational unit within the National Health Services of England and Wales, generally serving either a geographical area or a specialised function (such as an ambulance service). In any particular location there may be several ...
s 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
A diplomatic mission or foreign mission is a group of people from a state or organization present in another state to represent the sending state or organization officially in the receiving or host state. In practice, the phrase usually deno ...
based in London. 18 trusts in London had private patient units in 2018. The self-pay healthcare market doubled in value between 2010 and 2021.
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, excluding
cosmetic surgery or costs covered by health insurance. This was particularly marked in
orthopaedics
Orthopedic surgery or orthopedics ( alternatively spelt orthopaedics), is the branch of surgery concerned with conditions involving the musculoskeletal system. Orthopedic surgeons use both surgical and nonsurgical means to treat musculoskeletal ...
and
cataract surgery
Cataract surgery, also called lens replacement surgery, is the removal of the natural lens of the eye (also called "crystalline lens") that has developed an opacification, which is referred to as a cataract, and its replacement with an intra ...
where NHS treatment was increasingly
rationed
Rationing is the controlled distribution of scarce resources, goods, services, or an artificial restriction of demand. Rationing controls the size of the ration, which is one's allowed portion of the resources being distributed on a particular ...
.
Repatriation of NHS activity has led to declining revenues from the NHS. Dissatisfaction with the NHS was said by
LaingBuisson
LaingBuisson is a business intelligence provider across health, care and education, headquartered in Angel, London. It provides insights, data and analysis of market structures, policy and strategy and is the chosen provider of independent sector h ...
to be the primary driver of self-pay demand in 2018, though cosmetic surgery still accounted for a quarter of all self-pay revenue. In London there was a 3% decline in revenue for the 25 private hospitals and clinics in 2017, because of fewer clients from the
Middle East
The Middle East ( ar, الشرق الأوسط, ISO 233: ) is a geopolitical region commonly encompassing Arabia (including the Arabian Peninsula and Bahrain), Asia Minor (Asian part of Turkey except Hatay Province), East Thrace (Europ ...
. Overseas patients coming to London are more likely to choose the 12 private patient units run by NHS hospital trusts and more likely to be looking for cancer treatment than orthopaedics.
In 2018 75% of private healthcare for UK based patients was funded by private health insurance. About 40% of the work in private provincial hospitals was orthopaedics, but consultants in other specialties were not comfortable with the facilities available or the level of experience of staff, so patients with private insurance outside London were often advised to opt for NHS treatment. London private hospitals treated the vast majority of patients coming from abroad.
A survey by
YouGov
YouGov is a British international Internet-based market research and data analytics firm, headquartered in the UK, with operations in Europe, North America, the Middle East and Asia-Pacific. In 2007, it acquired US company Polimetrix, and sinc ...
in April 2022 found 29% of adults aged between 18 and 34, compared with 23% in the wider population, said covid had made them more likely to consider paying for healthcare treatment.
Spire Healthcare
Spire Healthcare Group plc is the second-largest provider of private healthcare in the United Kingdom. It is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index.
History
Spire Healthcare was formed from the sale of Bu ...
has had a 35% increase in patients in that age bracket mostly seeking general and orthopaedic treatment.
Conflict of interest
481 medical consultants, 73% of them NHS employees, owned shares in 34 joint ventures with for-profit healthcare companies in 2020. This generated £31 million in dividends for them, an average dividend of £11,600 a year, over the previous 6 years according to research by the
Centre for Health and the Public Interest
The Centre for Health and the Public Interest (CHPI) is a London think tank founded in 2012 to defend "the founding principles of the NHS". It is a registered charity.
Professor Colin Leys was involved in its foundation.
Research
It has produc ...
. The medical consultants who are part of these joint ventures receive a share of the profits of the company as a dividend, giving them a vested interest in the success of the business. As the researchers point out "there is a potential conflict of interest when NHS Trusts contract with the companies which are engaged in joint venture businesses with the Trusts' own medical consultants." The commonest speciality for these consultants was oncology - 71 of them. Orthopedic and general surgeons were the second and third most common. 15 of the joint ventures involved
HCA Healthcare
HCA Healthcare is an American for-profit operator of health care facilities that was founded in 1968. It is based in Nashville, Tennessee, and, as of May 2020, owns and operates 186 hospitals and approximately 2,000 sites of care, including sur ...
and 342 of the consultants. Between December 2020 and November 2021 NHS Trusts in London paid £36.4 million to HCA Healthcare for cancer services.
Forecast
The UK private healthcare market was forecast to grow from $11.8bn in 2017 to $13.8bn by the end of 2023.
A 40% increase in private hospital capacity in London is expected between 2018-2023. The private hospital patient market in
central London in 2019 is calculated at about £1.5 billion a year.
History
The
Royal Commission on the NHS reported on private medicine in the UK in 1979. Their report included:
*Registered
private hospital
A private hospital is a hospital not owned by the government, including for-profits and non-profits. Funding is by patients themselves ("self-pay"), by insurers, or by foreign embassies. Private hospitals are commonly part, albeit in varying deg ...
s,
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
chiropractor
Chiropractic is a form of alternative medicine concerned with the diagnosis, treatment and prevention of mechanical disorders of the musculoskeletal system, especially of the spine. It has esoteric origins and is based on several pseudoscien ...
s.
Expenditure on private health care in the UK in 1976 was estimated at £134 million (excluding
abortions, long-term care, and 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 of 2019, private expenditure on healthcare consisted of 20.5% of the total spent on health, a minor increase over the past 15 years. Private insurance expenditure consisted of 2.8% of the total.,
a trend of minor decline over the past 20 years.
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
Tax exemption is the reduction or removal of a liability to make a compulsory payment that would otherwise be imposed by a ruling power upon persons, property, income, or transactions. Tax-exempt status may provide complete relief from taxes, redu ...
to people over 60.
In 2012, the
Health and Social Care Act provided the greatest change to the United Kingdom's health care system to date.
It led to a number of health contracts being awarded to the private sector, increasing competition and diversity amongst providers.
Hospitals
The commission reported that there were 1,249 registered private hospitals and nursing homes in the UK with 34,546 beds in 1977. These figures included 117 private hospitals with facilities for surgery. There were at that time 116,564 people aged 65 or over in residential accommodation provided by or on behalf of local authorities, compared with 51,800 patients in NHS hospital departments of geriatric medicine. About 73% of the beds were for medical patients, 15% for surgical, 11% for mental health, and 2% for maternity. There were then about 4,000 beds in the private sector occupied by NHS patients under the care of NHS doctors, about 0.8% of the total beds available to the NHS. About half of abortions were at that time performed in private clinics and nursing homes. In 2021 it was reported that there were about 700 operating theatres in private hospitals, mostly staffed by NHS anaesthetists and surgeons working evenings and weekends. Few private hospitals had intensive care facilities for emergencies.
NHS consultants who undertook private practice were permitted, if facilities were available, to admit their private patients to designated private beds ("pay beds") of which there were then 4,859 in NHS hospitals or as
day patients, or to see them as
outpatients
A patient is any recipient of health care services that are performed by healthcare professionals. The patient is most often ill or injured and in need of treatment by a physician, nurse, optometrist, dentist, veterinarian, or other health care ...
. 42.8% of all NHS consultants worked part-time, mostly because they undertook private practice. Part-time consultants on average derived about one-third of their income from private practice.
The
Health Services Act 1976 established an independent Health Services Board to be responsible for the progressive withdrawal from NHS hospitals of pay beds. In 1979 the number had reduced to 2,968 from a figure of 7,188 in 1956. The Commission was told that the existence of private practice within the NHS facilitated and encouraged abuse, chiefly by patients avoiding waiting lists. Pay beds were at that time very controversial, but the view of the Commission was "We do not consider the presence or absence of pay beds in NHS hospitals to be significant at present from the point of view of the efficient functioning of the NHS".
Primary care
In 1971/2, about 2% of general practitioners’ income was derived from hospital, local authority and non-NHS public sector work, and about 6% from private practice. As
Health Secretary Matt Hancock
Matthew John David Hancock (born 2 October 1978) is a British politician who served as Minister for the Cabinet Office and Paymaster General from 2015 to 2016, Secretary of State for Digital, Culture, Media and Sport from January to July 201 ...
pointed out in 2018, "almost all GP practices are private companies". They work for the NHS under
contract
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tr ...
and, rather unusually for private contractors, have access to the NHS pension scheme. Dentists, opticians and pharmacies are also private contractors, but do not have access to the pension scheme.
In 1977, some 11% of general dental practitioners' time was spent on work other than in the general dental service, probably mainly on private practice.
There were about 1.12 million subscribers to provident schemes in 1978, of whom 869,000 were members of group schemes. Subscriptions often cover more than one person and in 1978 a total of 2.39 million people were covered.
In March 2019 the
Care Quality Commission
The Care Quality Commission (CQC) is an executive non-departmental public body of the Department of Health and Social Care of the United Kingdom. It was established in 2009 to regulate and inspect health and social care services in England.
I ...
revealed that of the private primary care services it had inspected of 32 out of 66 consulting doctor services and 16 out of 38 slimming clinics did not provide safe care. They were particularly concerned with the safety and efficacy of prescribing of high-risk medicines including opioid painkillers, antibiotics, unlicensed and clinically ineffective medicines and with poor communication between the private services and NHS GPs.
Private income for NHS trusts
When
NHS foundation trust
A foundation trust is a semi-autonomous organisational unit within the National Health Service in England. They have a degree of independence from the Department of Health and Social Care (and, until the abolition of SHAs in 2013, their local st ...
s 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
The Health and Social Care Act 2012c 7 is an act of the Parliament of the United Kingdom. It provided for the most extensive reorganisation of the structure of the National Health Service in England to date.'' BMJ'', 2011; 342:d408Dr Lansley's M ...
permitted Foundation trusts to raise their private income to 49% of the total. Only
The Royal Marsden NHS Foundation Trust
The Royal Marsden NHS Foundation Trust is an NHS Foundation Trust which operates the Royal Marsden Hospital facilities on two sites:
*The Chelsea site in Brompton, next to the Royal Brompton Hospital, in Fulham Road
*The Sutton site in ...
, 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, is anywhere near the 49% limit. the total private income of NHS trusts in England was £599.1 million in 2016-17 and £626 million in 2017-18. The top 10 earning trusts, all in London, contributed £381.1 million to the 2017-18 total. Private income of trusts outside London fell. It is unclear how much profit is made on this work.
The
Imperial College Healthcare NHS Trust
Imperial College Healthcare NHS Trust is an NHS trust based in London, England. It is one of the largest NHS trusts in England and together with Imperial College London forms an academic health science centre.
The trust was formed in October 200 ...
and
Moorfields Eye Hospital NHS Foundation Trust
Moorfields Eye Hospital NHS Foundation Trust is an NHS foundation trust which runs Moorfields Eye Hospital.
The Trust employs over 1,700 people. Over 24,000 ophthalmic operations are carried out and over 300,000 patients are seen by the hospita ...
have both opened clinics in Dubai. There are some joint ventures between NHS trusts and private providers.
HCA Healthcare
HCA Healthcare is an American for-profit operator of health care facilities that was founded in 1968. It is based in Nashville, Tennessee, and, as of May 2020, owns and operates 186 hospitals and approximately 2,000 sites of care, including sur ...
has run a specialist private cancer unit in partnership with
The Christie NHS Foundation Trust
The Christie NHS Foundation Trust in Withington, Manchester, manages the Christie Hospital, one of the largest cancer treatment centres of its type in Europe. The Christie became a NHS Foundation Trust in 2007 and is also an international leade ...
in Manchester since 2010. About 25% of patients using private services came from overseas.
In June 2019
Warrington & Halton Hospitals NHS Foundation Trust
Warrington and Halton Hospitals NHS Foundation Trust was created on 1 December 2008 from what was formerly known as North Cheshire Hospitals NHS Trust. The trust comprises Warrington Hospital, Halton General Hospital in Runcorn and Houghton Hal ...
was advertising that patients could pay privately for operations on the
NHS treatments blacklist
The NHS treatments blacklist is an informal name for a list of medicines and procedures which will not be funded by public money except in exceptional cases. These include but are not limited to procedures which the National Institute for Health ...
, but withdrew the advertisement after widespread criticism. In July it was reported that several other trusts were offering similar services.
NHS England warned all trusts: "We do not expect NHS providers to offer these interventions privately."
NHS use of the private sector
Jeremy Hunt
Jeremy Richard Streynsham Hunt (born 1 November 1966) is a British politician who has served as Chancellor of the Exchequer since 14 October 2022. He previously served in the Cabinet as Secretary of State for Culture, Olympics, Media and Sport ...
points out that "independent hospitals fish from the same pool of doctors for their workforce" so relying on the private sector sucks doctors and nurses out of NHS hospitals, making waiting lists even longer.
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. 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’.
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 centre
Independent sector treatment centres (ISTCs) are private-sector owned treatment centres contracted within the English National Health Service to treat NHS patients free at the point of use. They are sometimes referred to as 'surgicentres' or ‘sp ...
s 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. In ''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.
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.
When the coalition government introduced what became the
Health and Social Care Act 2012
The Health and Social Care Act 2012c 7 is an act of the Parliament of the United Kingdom. It provided for the most extensive reorganisation of the structure of the National Health Service in England to date.'' BMJ'', 2011; 342:d408Dr Lansley's M ...
it appeared to pave the way for a bigger role for private companies, 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 the 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.
As of recent years, the private sector accounts for approximately 10% of
elective care,
with this split evenly between NHS funded and private funding of care costs.
Controversy
The issue of privatisation of health services was an issue in the
2015 United Kingdom general election. 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". 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.
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.
Any Qualified Provider
Any Qualified Provider
Any Qualified Provider is a contractual system within the NHS internal market of the English National Health Service. The system was introduced under the Labour administration in 2009/10 when it was called "Any Willing Provider" - The policy con ...
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.
Scotland
Scottish health boards spent at least £130,866,841 on private providers from 2015 to 2018, about 0.5% of the budget compared to 7.3% in NHS England.
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. Most residential care for children is privately provided. In 2019
LaingBuisson
LaingBuisson is a business intelligence provider across health, care and education, headquartered in Angel, London. It provides insights, data and analysis of market structures, policy and strategy and is the chosen provider of independent sector h ...
predicted annual growth in the market, currently worth about £1.9 billion, of 5.2% for independent providers of NHS-commissioned mental health care between 2018 and 2023 because the NHS is focussing on community services, not institutional care. After series of scandals in services run by
Cygnet Health Care
Cygnet Health Care is an independent provider of mental health services which operates over 150 centres with more than 2,500 beds across the UK. It is a subsidiary of Universal Health Services, which acquired it for £205 million in 2014. It has ...
,
NHS England set up an independent oversight board in October 2019 to scrutinise inpatient mental health, learning disabilities and autism services for children and young people and a taskforce to make a rapid set of improvements in care. The board will be chaired by the
Children’s Commissioner for England
The Office of the Children's Commissioner for England is a non-departmental public body in England responsible for promoting and protecting the rights of children as set out in the United Nations Convention on the Rights of the Child, as well ...
, Anne Longfield.
Simon Stevens said at the launch of the board that a “sometimes-inappropriate” level of private provision in mental health inpatient services should be squeezed “as NHS mental health services expand”.
Performance
One of the criticisms of private care in the UK has been that private providers are not required to produce sufficient information about their services to permit comparison with NHS services. It is suggested that surgery in private hospitals may be dangerous because of inadequate equipment, lack of
intensive care
Intensive care medicine, also called critical care medicine, is a medical specialty that deals with seriously or critically ill patients who have, are at risk of, or are recovering from conditions that may be life-threatening. It includes pro ...
beds, unsafe staffing arrangements, and poor medical record-keeping. In 2018 it was reported that about 7,000 patients were transferred to the NHS each year from private facilities due to a lack of facilities to deal with problems in the private sector. Staff who also work for the NHS may not be available for support when needed. Most private hospitals do not have an intensive care unit, so if it is needed an ambulance must be called.
A patient died from
sepsis
Sepsis, formerly known as septicemia (septicaemia in British English) or blood poisoning, is a life-threatening condition that arises when the body's response to infection causes injury to its own tissues and organs. This initial stage is follo ...
after bowel surgery to remove
colon cancer at the Independent Berkshire Hospital, run by
Ramsay Health Care UK
Ramsay Health Care UK is a healthcare company based in the United Kingdom. It was founded by Australian businessman Paul Ramsay, who established its parent company: Ramsay Health Care, in Sydney, Australia, in 1964 and has grown to become a global ...
, in 2017. Failings in treatment led the
coroner to call for a review of the way private hospitals monitor warning signs of serious problems with patients. Nursing staff did not follow the national early warning score protocol. According to the independent expert the problem should have been suspected and detected five days before death and had it been, he would have survived.
The
Care Quality Commission
The Care Quality Commission (CQC) is an executive non-departmental public body of the Department of Health and Social Care of the United Kingdom. It was established in 2009 to regulate and inspect health and social care services in England.
I ...
reported in April 2018 that 30% of the 206 independent acute hospitals required improvement, mostly because of a lack of formalised governance procedures.
Information about performance is collected by the
Private Healthcare Information Network
The Private Healthcare Information Network (PHIN) was established by the United Kingdom Competition and Markets Authority under the Private Healthcare Market Investigation Order 2014. Jayne Scott, a non-executive director with the Scottish Governm ...
. They say that only 0.12% of admissions to private hospitals result in an emergency transfer to the NHS.
See also
*
Health care in the United Kingdom
Healthcare in the United Kingdom is a devolved matter, with England, Northern Ireland, Scotland and Wales each having their own systems of publicly funded healthcare, funded by and accountable to separate governments and parliaments, together wi ...
*
Private prescriptions
References
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