Private sector profits from illness: a well-funded NHS delivers value for money

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 Nick Mann is a GP and member of Keep Our NHS Public

Private sector involvement in NHS treatment centres

When the Government announced plans on 4 August to rapidly accelerate private sector involvement in the NHS, it was implementing recommendations of the taskforce PM Rishi Sunak set up in December 2022 packed with private industry leads and privateers whose interests reflect further encroachment of the NHS. Thirteen new diagnostic centres were announced put up as action to address the steadily rising NHS waiting lists – currently at 7.6 million. Significantly, 8 of the 13 centres will be run by the private health sector, part of the government target of 160 centres across the country by 2025 many of them already privately-run, backed by previously allocated £2.3 billion from the Treasury. The Government is openly ready to invest funding in the private sector that should be far better spent in building back the capacity of the NHS. However, the government spin that 114 are already up and running is simply a lie: at least 30 are not.

NHS capacity left threadbare as private CDCs are promoted

The NHS has the fifth lowest number of CT, MRI and PET scanners per capita in the OECD, with a third of hospitals using MRI scanners over ten years old, which is deemed unsafe. Germany has over four times the number of MRI scanners the UK has. Expansion of NHS clinical diagnostics is urgent and critical, so it is deeply disappointing to see plans to further divert taxpayers’ money into the private sector, at yet deeper financial cost to the NHS. Public funding is to be used to build eight out of thirteen community diagnostics centres (‘CDCs’) in England, which are then to be handed to companies owned by private equity to run the whole service. Unlike a situation where the NHS buys its scanners from the private sector – which it has always done – this is NHS privatisation.

Outsourced private sector diagnostics services may use inferior quality machines in mobile units and CDCs; they may require less training for radiographers; they frequently outsource interpretation of the scans to remote radiologists. In my experience, NHS consultants not infrequently have to re-request privately obtained scans from poor machines or scan results poorly reported on. Meanwhile, NHS Radiology is in crisis. The Royal College of Radiologists report a 2,000 shortfall in qualified radiologists, 33% below OECD average and below safe levels. Radiologists cannot simply be replaced with Artificial Intelligence, and the expansion of technology’s role in the medical interface must be carefully independently evaluated during its development. The National Breast Imaging Academy reported that staff shortages have led to several breast units closing. These NHS-run patient services are set to be replaced by private sector interests taking easy profits from the NHS and from taxpayers.

Blair’s ISTCs showed private sector not the answer to waiting lists

The idea that a private sector cavalry will ride in to save the 7.6 million patients on NHS waiting lists is fanciful and wrong. When Tony Bair injected substantial funding including targeted resources into the NHS – annual real terms funding increases averaged 6.9%, 2000-2010 – NHS waiting lists fell dramatically and our Health system functioned as a global leader. However, contrary to the rolling narrative, it is a mistaken assertion that this improvement was due to the private sector’s ‘help’. Labour’s Lord Ara Darzi’s much-vaunted Independent Sector Treatment Centres (ISTCs – dubbed “NHS” Treatment Centres!) were a failure, according to the Parliamentary Health Select Committee’s 2006 report.

In fact, it was investment into the actual NHS, and the activity this boosted capacity delivered, which served to reduce NHS waiting lists.  The ISTCs treated low numbers of patients; costs were high; staffing, funding and resources were sucked from the NHS into ISTCs and diverted to furnish private sector profits. Indeed, Blair’s Department of Health was criticised for its use of deceptive accounting in an attempt to falsely inflate the dismal ISTC figures.

Blair’s NHS combined policy responses sugar-coated the embedding of private sector interests with record NHS funding, the good disguising the bad. But those who promote his legacy disingenuously claim credit for ISTCs solving the waiting lists. Just as during Covid, the private sector then was notable by its expensive under-performance.

History is repeating itself – the fattened parasite ready to pounce

Faced with an even more profound crisis and greater need for NHS investment today even than in 1997, it would be illogical and ideological to repeat the same expensive mistakes that Blair made with ISTCs (and PFI) in the 2000s.

The CEOs of Spire and Health Corporation of America, who own most of the private hospitals in England, have described the NHS’s collapse as “opportunity”; just as VIP-lane friends of Ministers and private equity enjoyed such ‘opportunities’ for PPE and diagnostics procurement, and service provision, during the pandemic.

The NHS is not just being awkward in resisting increased private sector involvement; the private sector’s ‘success’ actively and expensively depletes the NHS – whilst private hospitals, private insurance, NHS hospital private wards, private GPs, private diagnostics etc., all will benefit from the existence of long NHS waiting lists and inadequate NHS capacity.

There is no ‘spare capacity’ in the private sector that does not damage the NHS

As with ISTCs, instead of recycling funding back into the NHS, private sector profits are leached from the taxpayer’s money, further diminishing the little funding that the NHS operational frontline demonstrably has. Cherry-picked elective referrals pour ‘easy money’ to the private sector, depriving NHS hospitals of much-needed revenue without which the NHS is left to care for the more complicated and sicker patients, who are in hospital for longer with much greater costs to the NHS Hospital’s budget. The private health sector model is inevitably geared to profit extracted from commoditising illness. The public NHS model, when funded, gives cost-effective excellent value for money and good care to as many as it is funded for. Private Health ‘partnerships’ with the NHS, as in the case of ISTCs, are not mutually beneficial and will not live up to the promises. Workforce capacity is a problem in the private sector too, limited mostly by the numbers of Consultant Surgeons and Anaesthetists. NHS Consultant training post numbers remain artificially constrained by Government and in some cases – in Anaesthetics, Core Medical Training, and Neurosurgery – are actually falling, not rising to meet demand. Both funding and staffing for private sector activity are sourced directly from the NHS, inevitably progressively depleting the NHS’ funding and staffing as private activity increases.

Invest in the future, invest in the NHS model

In real terms and on paper, the NHS is a good investment. When the NHS was well-funded, with professional leadership, it provided a genuinely world-leading medical environment of international acclaim; for standards, quality, education, training, and research. The NHS also gives back: The NHS Confederation calculates that for every £1 spent on Health, the economy gains £4. What does the private sector give back?

But thanks to government policies of underfunding and restructuring the NHS, this system no longer exists, and some will wait years before fully understanding the profoundly detrimental effects of the running down, de-professionalisation, corporatisation, and commercialisation of the NHS and its functions. It is not a new strategy, it’s an old playbook: it’s the model of water, energy and rail. The privatised NHS: poorer quality, reduced eligibilities, more expensive – what’s not to like?

The private sector profits from illness while the NHS delivers excellent value for money, without any profit motive: invest in the NHS model, don’t undermine it.

Dr Nick Mann is a GP and a member of Keep Our NHS Public

X (Twitter) @drnickmann

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1 Comment

  1. I would be most grateful if Dr Nick Mann would confirm that his views also apply to NHS High Street general dental practice as well as primary & hospital medical care.

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