Since the pandemic began early last year, NHS waiting lists – currently sitting at 5.6m, and growing by 150,000 a month, up by 20 per cent since the start of the pandemic and predicted by health secretary Sajid Javid to eventually hit 13m – are now a prime consideration in private health companies’ business models, promising new profits driven by rising numbers of patients effectively forced to use their services.
And even those patients who can’t afford private surgery – in the latest Healthwatch England poll, that’s almost 50 per cent of respondents waiting for delayed treatment – often have to pay just to manage their pain levels. Research by charity Versus Arthritis, revealed in a recent BBC Panorama documentary, found that 54 per cent of people with arthritis and currently waiting for surgery spend on average more than £1,700 a year on private physiotherapy and over-the-counter painkillers.
No wonder then that a survey of 4,000 adults by charity Engage Britain last month found that 21 per cent – that’s more than one in five – had had to go private because NHS treatment was unavailable, and another survey earlier this year showed that 13 per cent of consumers in the UK already belonged to a private medical insurance scheme, and more than half – 53 per cent – said they would pay for private treatment.
No wonder too that leading UK provider Spire Healthcare last month reported a pre-tax profit of £4.7m, against a loss of £231m a year earlier. It claimed it had made no profit from the government’s bulk-purchase arrangement last year – of which it was one of the main beneficiaries – despite making £486m from its NHS work. Spire reported record revenues from private patients without health insurance paying for their own treatments, with the number up almost 47 per cent from pre-pandemic levels. The increase helped lift the company’s revenues nearly 40 per cent to £558m.
Suspicions that the pandemic was leading to the creation of a two-tier health system began to surface 12 months ago. According to one newspaper report, Compare the Market recorded a 40 per cent increase in private health insurance sales over the preceding seven months – ie since the first lockdown began in 2020 – and HCA Healthcare admitted that self-pay surgeries and procedures in some areas had doubled over the same period.
Spire Healthcare also reported a similar surge in commercial activity last year, while health data company Laing Buisson – which in April this year estimated the value of the self-pay market at £1.1bn a year, and reported that the market was expected to grow by 10-15 per cent over the next three years – claimed that smaller operators were also milking the pent-up demand stemming from NHS waiting lists by offering procedures to those without insurance who were prepared to pay.
Centre for Health and the Public Interest (CHPI) director David Rowland told the Guardian last month that private operators were already trying to create a new type of health consumer who pays for their own treatment before the pandemic, and were seeking to make self-pay more attractive by offering fixed-price packages with some hospital groups, such as Nuffield Health, even offering zero-interest finance. Chillingly, he noted that lucrative cancer treatments became the biggest single earner for private hospitals in London in 2019.
In fact the sheer volume of non-urgent elective work continuing to be performed in the private sector at the beginning of this year, while the health service still remained under pressure, led to a joint letter from regional medical directors urging their counterparts in London not to support staff who were also working outside the NHS, for a limited period. As both the CHPI and the Health Foundation thinktank have noted, surgeons and other senior clinicians are rarely if ever employed directly by private hospitals, but are mostly NHS doctors.
HealthInvestor UK magazine MD Vernon Baxter also told the Guardian last month, “The pandemic will have a long-lasting impact on the self-pay market. With the NHS under pressure for the foreseeable future, the concept of paying out of pocket to expedite treatment will be increasingly commonplace – for those who can afford it.”
CHPI director David Rowland expressed similar concerns to the newspaper: “There is a big risk that unless government provides adequate funding for the NHS, more and more people will be forced to pay privately, which in turn will undermine middle-class support for a tax-funded NHS.” He predicted the possibility of ending up with a two-tier system, where the NHS is a residual service for those without the means to pay.
But mining a handy new income stream as patients stuck on NHS waiting lists reluctantly go private has only added to the gains made by the private sector since the pandemic began.
A national block-purchasing ‘cost price’ contract, negotiated in the first few weeks of the lockdown in 2020 and designed to augment NHS capacity, saw the private sector’s capacity – the bulk of it offered by Spire Healthcare and Circle Health, and representing just 8,000 beds – put at the disposal of the health service during the pandemic.
This was thought to have cost the NHS around £400m a month – more than £1.5bn in total, although the exact figures have not so far been published – and at the time was seen by some as a rescue package for commercial interests experiencing a rapid drop in patients (and hence income), rather than a genuine attempt to ease pressure on the health service at a time of national crisis.
Concerns were also expressed that companies owned by Conservative Party donors, or those with previous connections to the Department of Health & Social Care, benefited from a block-purchasing deal which proved of questionable value to the public purse.
Documents leaked to online news site HSJ last December suggested that two thirds of this capacity went unused, despite NHS waiting lists lengthening by the day. And earlier this year the CHPI revealed that the 26 private contractors involved in the block-purchase deal rarely treated more than 65 patients on any given day, and that on some occasions no private beds were being used at all for covid patients.
A subsequent procurement framework, introduced in November 2020, replaced the block-purchase set-up with a longer-term plan, but this entails NHS England paying private hospitals up to £10bn over the next four years – instead of investing that cash directly into the health service – in order to help reduce its waiting lists.
This ongoing generosity by the government to the private sector offers a strong contrast to its approach to funding the NHS. Headline-grabbing announcements of £36bn being made available over three years to clear the backlog fail to address longer-term structural and staffing issues within the health service.
A new report from the Health Foundation, released at the beginning of October, found that the NHS and social care in England will need more than 1.1m extra staff over the next decade to keep up with growing demand, because of the ageing population and greater numbers of patients with long-term illnesses, as well as the backlog caused by the pandemic. The NHS in England currently has 94,000 vacancies, including for 9,691 doctors and 38,952 nurses, and the Health Foundation estimates the cost of bringing the public sector capacity back up to full strength at £86.4bn, more than double the £36bn that is now on offer from the government.
The BBC Panorama documentary mentioned earlier rightly focused on the growing health inequalities faced by many patients in the UK, denied urgent care but unable to leapfrog waiting lists and pay to go private. It highlighted one case where a family had had to resort to crowdfunding to pay for a teenager’s scoliosis operation in Turkey before his condition became inoperable.
The NHS was set up in 1948 to combat exactly this sort of inequality – where patients and their families in effect have to beg to pay for their healthcare – and the need to restore the health service to its former status has never been more urgent. Particularly, as one commentator has warned, with private operators now deciding whether to position themselves as a partner to the NHS, or as a competitor.
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