Why is ‘Our’ ‘World-Beating’ NHS Such a Basket Case?

I’m frequently asked by friends and colleagues why the NHS can’t sort itself out – it now seems self-evident to many that we simply can’t go on like this. Leading commentators in the media and public life now acknowledge that social insurance schemes operating in mixed healthcare economies popular in mainland Europe have both better outcomes, wider choice for patients and generally higher satisfaction scores than our ‘world beating’ NHS.

The proportion of people choosing to pay for their own care outside the NHS system is rising because the NHS simply can’t meet patient requirements. A few weeks ago I wrote a piece looking at the substantial operational challenges facing the service. This week I’d like to look at some of the inside reasons and hidden agendas which mean the NHS can’t change even if it wanted to.

Broadly speaking there are four groups who need to be onboard the change bus if structural reform of the NHS is to succeed – the electorate, the political class (cross party), the NHS management cadre and NHS professional groups. Unless all of these groups agree on both the need for and the direction of change, nothing is likely to happen. The barriers to meaningful reform are not obvious to the lay person. I have written previously about structural changes in the workforce and the increasingly intrusive burden of regulation, which hinder efficiency. In this piece I will focus on the hidden road-blocks to restructuring.

Firstly, let’s consider what the NHS does well. A wide variety of think tanks and supra-governmental organisations produce score boards to compare healthcare systems. The NHS often scores highly in domains such as equality of access or management of chronic disease but performs consistently poorly on virtually all major outcome measures such as cancer survival or recovery from heart disease and stroke. This has been the case for many years. Failure to recover after the pandemic has widened the performance gap between the NHS and continental European systems. So, the NHS does well on equality, not badly on value for money, but consistently fails to deliver what the public want – rapid access and quality outcomes. This is not surprising from a socialist system – not too dissimilar to a Soviet tractor factory.

Where the NHS really excels is at protecting itself from externally imposed change. Nigel Lawson’s oft quoted remark about the NHS being the closest thing to a national religion is uncannily accurate – it genuinely does share aspects of religions: a foundational myth (1948), a strict moral code (free at the point of use), sacred rituals and devotional display behaviour (clap,clap,clap), a social group bound by common beliefs and hostility to unbelievers and heretics (NHS = good, private sector = evil).

Another point of excellence is the way in which the NHS has managed to elide its brand with delivery of healthcare in the U.K. Let’s be clear – the NHS is a system for managing the activity of healthcare professionals. It is the organisational structure within which clinical staff function. When one hears a virtue signalling celebrity claiming that “the NHS saved my life”, this is a triumph of cuckoo branding. The doctors and nurses involved in the case may or may not have saved the life – the NHS is the employer of those clinicians – no more, no less. If the NHS had not existed, the life would still have been saved. If the patient had been in France or Germany, the life would still have been saved. Yet the U.K. public persist in believing that without the NHS, people would be dying for lack of affordable healthcare. How can this be?

The NHS is also excellent at extracting money from the taxpayer. The current NHS budget for England in 2021-22 is £180 billion. (Total healthcare expenditure including the private sector was £277 billion in 2021, or 12% of GDP – well above the OECD average.)

In 2019-20, 46.6% of the NHS budget money was spent on staff salaries (£56.1 billion) and this figure does not include GP salaries – so the vast majority of NHS funding goes on paying the staff.

In 2021, healthcare spending accounted for 20% of all public spending and 45% of day to day spending on public services by the U.K. Government.

Why do these dry statistics matter? Because NHS funding is entirely contingent on winning arguments in Whitehall about how the national pie is divided up. Ed Miliband may have unwisely bragged about ‘weaponising’ healthcare, but the NHS executive got there well before him. In 33 years of professional life, I have never known a time when the NHS wasn’t in a ‘funding crisis’, even during the largesse of the Blair administration. As their entire funding stream relies on the big state, it would be intellectually incoherent and self-defeating for NHS leaders to be anything other than left leaning in political terms. In the current parlous economic situation this provides a strong incentive to ‘play it long’ – to foot drag and temporise until such time as a Labour government can unconditionally hand over the taxpayer’s chequebook once again.

The key driver of change in a representative democracy is supposed to be public opinion. This view discounts the ways in which the public can be manipulated. In the case of healthcare, this is usually achieved by inculcation of fear, often by presenting a U.S. Style system as the only alternative to “cradle to grave, free at the point of use NHS”. This approach conveniently ignores multiple better options in the mixed health economies of continental Europe and Australasia. No matter how bad NHS performance becomes, the public have been conditioned to believe that change would be worse. The fear narrative is backed up by a 24/7 media, hungry-to-amplify catastrophising messages. Déjà vu all over again perhaps.

Fear is also generic in politicians aspiring to move towards a more sustainable mixed health economy model. As Jean-Claude Junker remarked, “We all know what to do, but we don’t know how to get re-elected once we have done it.” Keir Starmer’s Labour party have already committed themselves to the NHS model as a ‘constitutional right’ and will go into the next election wedded to the existing system. Sunak’s administration is exhausted and battling on too many fronts to take on the problem before 2024. Andrew Lansley’s much derided structural reforms of NHS management in 2010 were an attempt to take the first step down the road of meaningful reform. Lansley sought to devolve day-to-day management of healthcare to the NHS executive believing that public annoyance about poor NHS performance would then be directed towards NHS managers rather at elected politicians. Sadly, he failed to take into account one crucial point – the public can sack elected representatives, but they can’t sack NHS managers.

By devolving operational control to unelected managers, Lansley inadvertently also handed over tremendous power to a cadre of unsackable mandarins in the newly created NHS England. In my view, Lansley had the right idea, but was stymied by the ‘power of the blob’ – the stubborn resistance of a managerial structure with a vested interest in resisting change. The tactical techniques by which this is achieved are familiar to many in the system. If an unwelcome change is proposed, a consultation must be held and a stakeholder group invited onto a committee to consider the matter. Advocates for change are identified and excluded at an early stage and the committee is packed with malleable participants who can be relied upon to oppose reform. The committee deliberates at length and comes up with a variety of reasons why the change would cause serious damage to patient care. Leaks to the press put pressure on MPs. ‘Patient advocacy’ groups are incited to lobby against the proposal. If all else fails, the tactic of ‘consent and evade’ can be deployed, whereby the change is agreed to in public but sufficient administrative grit is tipped into the gears to make sure it never happens. Eventually the proposal is quietly dropped.

I finally turn to the fourth key group needed to enact change – the professions. Listening to the constant litany of complaint from doctors about the NHS system, one might think that the medical profession would be keen to move to a more market-based approach. Sadly, not so. The notion that most doctors are earning a fortune in private practice is a myth. There are 53,000 consultant level doctors in the U.K. Only 20% of these do any private work and the majority of work in the private sector is undertaken by about 5,000 doctors, based mainly in the SE of England.

The main complaint of NHS doctors is that they are paid too little and are worked too hard. Yet very few of them are keen on openly competing in a free market for healthcare services, preferring to agitate and threaten strike action to extract more money from taxpayers rather than push for meaningful reform. Doctors pay in the NHS certainly has fallen behind other professional groups in the last 20 years, but on the other hand medicine remains a stable means of employment with an index linked pension on an upward only salary scale with guaranteed increments for seniority. Readers wishing to understand the dynamics of medical remuneration may wish to read this excellent blog post I came across recently which summarises the situation very well. Being written in 2017 it’s a little out of date – for example, remuneration rates in private practice have been steadily falling as increased corporatism squeezes practitioners incomes. But it is nonetheless a highly insightful piece.

So, there we have it. A failing system with a management cadre incentivised to entrench the status quo, a workforce demanding more money for less work, a population convinced by the media that any meaningful change would be catastrophic and a political class terrified of intervening. I agree with Kate Andrews who recently observed that: “The upcoming strikes may be designed to address the pay and working conditions, but their walkout may shine light on a harsh truth many within the NHS are still unwilling to admit: the system isn’t working for anyone. And no amount of cash is likely to save it without reform.”

Don’t hold your breath, Kate. Reform isn’t happening any time soon.

The author, the Daily Sceptic‘s in-house doctor, is a former NHS consultant now in private practice.