NHS Difficulties and International Comparisons

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NHS Difficulties and International Comparisons

• Adrian Bull
• Medical Director
• AXA PPP healthcare

Insurance Institute of London 23 January 2002
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Total healthcare expenditure GDP(OECD 2001)
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Private (Public) Healthcare Expenditure
GDP(OECD 2001)
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Healthcare expenditure per head of population (
Purchasing Power Parities) 1999
Courtesy - Civitas from OECD 2001)
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UK Waiting Times
1995
1998
2001
Numbers on surgical waiting lists (gt1 year)
1.04m (3)
1.3m (5)
1.07m (4)
Mean waiting time for common procedures on
admission (1998/9)
Knee replacement Cataract and lens
implant Coronary bypass
41 weeks 38 weeks 28 weeks
12 are emergencies
OECD 2001
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Age standardised mortality per 100,000 (1998)
OECD 2001
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CBI Healthcare Brief - December 2001

• Direct costs of sickness absence in 2001 10.7bn
• Total costs including welfare 23bn
• 7 of working age claim incapacity in UK compared
  to 2.1 in Germany, 0.3 in France
• Healthcare system at fault - Lack of GP
  expertise - Time to see a specialist -
  Cancelled routine operations
• Recommend - Corporate tax/NIC
  relief - Introduce user charges - Greater
  commercialisation of services - Resolve
  operational and structural inefficiencies

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SatisfactionEuropean Survey Responses
1996(Mossialos Health Economics 6, 109-116, 1997)
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Wanless
UK health outcomes are generally poor compared
with other countries Lowest European survival
rates for breast and lung cancer A key
strength is maximum separation between ...
financial contribution and use of
healthcare The main weakness is that public
financing provides limited scope for expression
of individual preferences and choice
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CURRENT RESPONSIBILITIES(Laing Buisson Report
2001)
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Equity/Solidarity and Underwriting Rules
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The Equity (Solidarity) Issue

• Social Equity The essence of a satisfactory
  health service is that the rich and poor are
  treated alike, that poverty is not a disability
  and wealth is not advantaged. (WHO Report
  2000)
• Actuarial Equity People in the same class of
  risk should contribute in proportion to the
  likely size and probability of that classs
  healthcare costs.
• Socioeconomic factors in ill health mean that
  highest risks occur in those least able to pay.

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Private Contribution

• Out of pocket funding
• Supplementary insurance
• Complementary insurance
• Opt out insurance

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France

• Supplementary health insurance for 84 of
  population 12 of healthcare expenditure
• Assurance Maladie covers State funded costs

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Germany

• Krankenkrassen (Sickness funds) - Statutory
  Health Insurance- Supplementary Benefits
• Opt out option above certain salary level

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Canada

• Outlaws private provision of public system
  services on more favourable terms
• Does not cover, eg, out-patient prescription
  drugs, home healthcare

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Australia

• State (taxation) funded healthcare
• Incentivised private medical insurance - Tax
  relief - Community Rating - provided
  early take-up - Tax surcharges
• 40 population

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The Netherlands

• Government income tax and user charges for long
  term and catastrophic costs (38)
• Mandatory sickness fund insurance (65 of
  population, 37 of costs)
• Voluntary private insurance for those above
  income threshold or working for a government
  (14). Risk rated.
• Complementary policies for additional benefits
  (eg user fees)
• Direct provision of public health services

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Ireland

• Universal public health funded system
• Voluntary insurance for more amenities and
  quicker treatment but community rated lifetime
  renewable open enrolment (35 population 10
  costs)

BUT
Cross subsidy of private sector age limit on
entry
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THE ISSUES
Personal versus State responsibility Choice and
flexibility versus equity and accountability
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Issues - NHS

• Single organisation controlled from DoH, 1m
  employees
• Autonomy of local authority overruled by Treasury
  and Department
• Priority setting from centre
• Structural changes an end in themselves, eg 1962
  Hospital Plan, 1974 Reorganisation, 1982 Revision
  of AHAs, 1989 Working for Patients, 1997 Labour
  Reforms, 2002 Shifting the Balance
• Classic Bureaucratic model - universal consistent
  function and standards assured by administrative
  structure
• No choice

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Government Strategy

• Reject private funding of core healthcare
  (inequity)
• Ambitious plans to increase workforce
• Extend some coverage (eg nursing care for
  elderly, occupational health services, eye tests
  over 60s)
• Improve regulation/quality CHI, NCSC, NCCA,
  NICE, etc.
• Reduce negative effects of private sector
  (consultant contracts)
• Increased use of private sector for elective
  surgery
• Top down purchasing choices (PCTs)

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Achieving Equity

• Co-existence giving social equity requires
  elimination of double cover advantage and
  selective underwriting
• A regulated system would be more equitable than
  the current parallel system
• Need to modify perverse incentives inherent in
  arrangements for specialists remunerations

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European Union Consideration

• Kohll Decker judgement 1998
• Geraets-Smits Peerbooms judgement 2001

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Achieving the Balance

• Benefit in kind - money to follow patients
• Choice of fund manager/purchaser of service
• Public funding at the core
• Regulatory reform
• Mixed economy of provision
• Supplementary contribution for style of service,
  level of access, flexibility of response