The NHS and the The NHS and the Private SectorPrivate SectorAdvantages and disadvantages of Advantages and disadvantages of increasing the role of the Private increasing the role of the Private Sector in the provision of health Sector in the provision of health

carecare

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The Private Alternative

• When the NHS started the Labour government insisted that the Private alternative should still be open to the people of Britain.

• AIM – Freedom of Choice.

• NOTE: The relationship between the private sector and the NHS has been a difficult one.

Private Health Care.

• Private Health care has always existed in Britain.

• Private Health Care has always been associated with the middle and upper classes (although it said they do not exist anymore).

Paying for Private Health Care.• People who choose to ‘go’

private usually pay for their treatment through a form of Private Medical Insurance (PMI).

• BUPA and AXI are forms of PMI.

• This medical insurance works the same way as a persons Home Insurance or Car Insurance

How does it work?

• PMI works on the principle that the lower possibility that you will claim (Actually use the Private Medical Service) the lower your premiums or payments are.

• For example Joe Stevens (72) premiums will be higher than Carol Watson (25)

• Why is this the case?

Increased number of Private Patients.

• 1950’s – Approximately only 2% of the population was covered by PMI.

• 1990’s – The figure has increased to approximately 12.7%

WHY IS THIS THE CASE?

• One of the main reasons that this is the case is that some people have lost faith in the NHS. For example

• Long waiting lists• Hospital-based diseases (e-coli, MRSA)• Lower standards of care• Media scare stories• High profile court cases• Government promotion of PMI

• During the 1980’s people who worked were becoming richer and as a result the relative cost of PMI decreased.

• Many companies began to offer PMI along with company cars and cheap loans as a perk to attract key skilled workers.

• Why was this an advantage for big companies?

Conservative governments and PMC.

• The Conservative government of 1979-97 were very enthusiastic about PMI.

• They did not want the NHS to be the only or main provider of health care as they believed the NHS was getting too big.

• They also believed that if the NHS was the sole provider of care then there would be no competition and therefore their would be no incentive to improve services for patients.

1. Waiting lists are reduced1. Waiting lists are reduced

1.1. In many cases, the NHS will In many cases, the NHS will ‘sub-‘sub-contract’contract’ out operations to the private out operations to the private sector if it cannot deal with all of it’s sector if it cannot deal with all of it’s patients so NHS waiting lists kept patients so NHS waiting lists kept downdown

2.2. It estimated that the NHS hires It estimated that the NHS hires 40%40% of of private sector beds private sector beds

3.3. Sub-contracting helps the NHS to Sub-contracting helps the NHS to meet waiting list meet waiting list ‘guarantees’‘guarantees’

2. Increased Patient Choice2. Increased Patient Choice

• It gives NHS patients more It gives NHS patients more choicechoice than they would have if the private than they would have if the private sector was not used as a sub-sector was not used as a sub-contractorcontractor

• Patients can choose Patients can choose time and time and placeplace most convenient to them most convenient to them

3. 3. ‘Windfall’‘Windfall’ funding funding

• If a patient chooses to ‘go private’, If a patient chooses to ‘go private’, then the NHS still gets that then the NHS still gets that persons taxation and National persons taxation and National Insurance contributions ‘for Insurance contributions ‘for nothingnothing’’

• In finance terms this is called a In finance terms this is called a ‘‘windfallwindfall’ – where money is ’ – where money is received for little or no outlayreceived for little or no outlay

4. 4. JobJob Creation and Creation and trainingtraining

• Private health creates hundreds of Private health creates hundreds of jobsjobs in Scotland in Scotland

• People who work in the private sector People who work in the private sector will get skills will get skills trainingtraining which they which they might bring back to the NHS might bring back to the NHS

• There are many There are many constructionconstruction jobs jobs created when building a new private created when building a new private hospitalhospital

• It benefits It benefits locallocal businesses who businesses who supply goods and services to a supply goods and services to a private hospital in the areaprivate hospital in the area

5. Prevents the ‘Brain Drain’5. Prevents the ‘Brain Drain’

• Some top medical staff would be Some top medical staff would be tempted to go tempted to go abroadabroad to work for much to work for much higher wages than they get in the NHShigher wages than they get in the NHS

• allowing them to work part time in the allowing them to work part time in the private sector ‘private sector ‘boostsboosts’ their NHS ’ their NHS income and so might help to stop them income and so might help to stop them going abroad. going abroad.

• Better to have ‘Better to have ‘halfhalf’ a top surgeon in ’ a top surgeon in the NHS than none!the NHS than none!

6. Keeps Key Workers at Work

• Key workers* in the economy are able to be treated more quickly privately than if they had to wait in an NHS ‘queue’

• These workers are able to ‘plan’ their absence more effectively and reduce the impact of their absence(*A key worker’ might be someone like a top salesperson who wins orders to keep others in a job)

7. Increases 7. Increases CompetitionCompetition and and EfficiencyEfficiency

• Certain services such as laundry, Certain services such as laundry, catering etc are put out to private catering etc are put out to private tender – companies tender – companies competecompete against each other.against each other.

• This competition will This competition will lowerlower prices prices

• the NHS saves cash to the NHS saves cash to put backput back into treating patientsinto treating patients

Advantages - summary

1.1. Waiting Waiting listslists reduced reduced2.2. Increased patient Increased patient choicechoice3.3. NHS gets funding ‘NHS gets funding ‘windfallwindfall’’4.4. Health Health jobsjobs are created and staff are created and staff

are are trainedtrained5.5. Reduces Reduces brainbrain drain drain6.6. Accommodates Accommodates keykey workers in the workers in the

economyeconomy7.7. PPublic ublic PPrivate rivate PPartnershipartnership8.8. Increases Increases competitioncompetition and and

efficiencyefficiency

AGAINST PMC.

• It is immoral that money can buy health. It is argued that health should not be a consumer good, like beer.

• All human life is equally important, regardless of the amount of money a person has.

2. The NHS becomes a ‘dumping 2. The NHS becomes a ‘dumping ground’ for expensive patientsground’ for expensive patients

• Private health insurance is too costly for Private health insurance is too costly for some peoplesome people

• Private health insurance discourages Private health insurance discourages ‘expensive’ patients by putting up premiums ‘expensive’ patients by putting up premiums (payments)(payments)

• The NHS is left with the treatment of the The NHS is left with the treatment of the chronically ill, the poor, the elderly – the chronically ill, the poor, the elderly – the expensive and long-term patientsexpensive and long-term patients

• Private sector ‘plays on’ the image of the Private sector ‘plays on’ the image of the NHS as second bestNHS as second best

3. Moonlighting3. Moonlighting

• ‘‘moonlighting’ means getting paid moonlighting’ means getting paid by someone else on your by someone else on your employers timeemployers time

• Some NHS staff who also work in Some NHS staff who also work in the Private Sector may treat their the Private Sector may treat their private patients during their NHS private patients during their NHS timetime

4. ‘Freeloading’

• Most nurses and doctors are Most nurses and doctors are trainedtrained within within the NHS, this costs a lot of moneythe NHS, this costs a lot of money

• At the end of the training, these staff could At the end of the training, these staff could choosechoose to work in the Private Sector which to work in the Private Sector which has paid nothing for the traininghas paid nothing for the training

• A lot of new A lot of new proceduresprocedures and treatments are and treatments are piloted and tested in the NHS – the Private piloted and tested in the NHS – the Private sector can get the benefits of this without sector can get the benefits of this without having had the costs.having had the costs.

• This is called ‘This is called ‘freeloadingfreeloading’’

5. Pay Beds within the NHS5. Pay Beds within the NHS

• A certain number of beds within the A certain number of beds within the NHS are kept for NHS are kept for privateprivate patients patients

• This This earnsearns the NHS money the NHS money• Patients in pay beds, however, Patients in pay beds, however,

require more require more attentionattention from staff so from staff so these pay beds are more costly to these pay beds are more costly to the NHS than ordinary beds.the NHS than ordinary beds.

6. NHS equipment used by 6. NHS equipment used by Private SectorPrivate Sector

• Some private hospitals do not have the very Some private hospitals do not have the very largest equipment such as largest equipment such as MRIMRI scanners scanners

• They will ‘They will ‘rentrent’ time on these from the NHS – ’ time on these from the NHS – this earns the NHS moneythis earns the NHS money

• but, the Private Sector does not have the but, the Private Sector does not have the initial initial outlayoutlay of buying the machine of buying the machine

• Time used in this way means Time used in this way means fewerfewer NHS NHS patients treatedpatients treated

7. No ‘expensive’ Emergency 7. No ‘expensive’ Emergency ServicesServices

• Private hospitals do not have to bear the Private hospitals do not have to bear the cost of expensive cost of expensive Accident & EmergencyAccident & Emergency servicesservices

• The Private Sector does not have the The Private Sector does not have the cost of the cost of the ambulanceambulance service to meet service to meet

• Accident patients needing emergency Accident patients needing emergency treatment are taken first to an NHS treatment are taken first to an NHS hospital and only later hospital and only later transferredtransferred to the to the private hospital if their condition allowsprivate hospital if their condition allows

8. Loss of Working conditions

• Many staff who used to work Many staff who used to work for the NHS, whose jobs have for the NHS, whose jobs have been ‘contracted out’ find been ‘contracted out’ find themselves with poorer themselves with poorer conditionsconditions such as longer such as longer hours.hours.

Disadvantages - summaryDisadvantages - summary1.1. ImmoralityImmorality of money buying health of money buying health

2.2. NHS seen as ‘NHS seen as ‘dumping grounddumping ground’ – a 2-tier health ’ – a 2-tier health service?service?

3.3. NHS staff ‘NHS staff ‘moonlightingmoonlighting’ in the Private Sector’ in the Private Sector

4.4. Private Sector ‘Private Sector ‘freeloadingfreeloading’ off of the NHS’ off of the NHS

5.5. Pay bedsPay beds in NHS take up more staff time in NHS take up more staff time

6.6. Using NHS Using NHS equipmentequipment

7.7. Don’t have to have high cost Don’t have to have high cost A&EA&E

8.8. Loss of working Loss of working conditionsconditions for staff transferred for staff transferred to Private Sectorto Private Sector