Funding The NHS

The NHS is probably the most comprehensive health service in the world. But it is now in crisis at every level and in every sphere. From time to time I plan expose what I believe are fatal flaws, which hobble its outcomes and frustrate both its selfless, overworked and dedicated staff as well as its suffering patients. Today I want to talk about money.

From the moment it was founded the NHS was launched on a mathematical impossibility. You cannot provide an infinite service on a finite budget. Yet it has always been the case that the NHS has had to work within the financial constraints or generosity (the latter not very often) of the government of the day. But the NHS, while planning large numbers of pre-booked procedures, investigations and treatments,  does not know for certain what any day will bring. Because its budget is fixed for the year and because it is paid out of general taxation, the more patients it has to deal with, the less it has to spend on each of them. That is plainly ridiculous.

The more customers who enter a supermarket the more they spend and the more the company stocks up to supply them. Imagine the fiasco if the owners were paid by the government a fixed sum to feed an unknown number of people in the district. Soon there would be hunger, shortages and queues.

The first thing we have to get straight is that the NHS is not free. We all pay for it. The problem is we are throwing money at the wrong business model. What is required is a funding system that expands with demand, so the more patients and procedures, the more the money. Not because the government allocates more, but because it is done automatically.

This is not a proposal to privatise the NHS. Nor does it, nor should it, involve the private sector for organisational reasons which I will lay out in a later blog.  The Government, or rather the State, should be the sole employer and provider, but instead of a fixed budget met from general taxation, it would be on the actual cost  paid by a universal insurance premium surcharged to income tax. Re-set annually, it would be calculated according to the current cost of the service and the  ability to pay, so the higher earners would pay more than the lowest. The State would be the sole insurer and there would be no exclusions from cover, as in private insurance schemes, which exclude existing health conditions or add surcharges to cover them.

The principle of the greater the demand, the greater the money, would be established and there would be democratic control of what was or was not free at the point of delivery. To make it work huge reform and de-structuring would be required to the byzantine structures and hierarchies which proliferate at the moment. These will be discussed in a future post.

The object is a health service without waiting lists, queues and cancellations, or such abuses as moonlighting doctors earning big money in private practice while others work themselves into the ground filling the gaps. What we need is an NHS, operating 24/7, giving  joined up care to those in need, which is all of us at some point in our lives and with the money, staff and equipment to do the job properly.

That was the big idea at the beginning in 1948. It can be delivered, but not until we put the funding on a footing that meets the ambition.