11 November 2022

Those who choose private healthcare are doing the NHS a service


It is probably the case that Rishi Sunak, an extremely wealthy man, has private health insurance, as Labour MPs alleged in the House of Commons this week. But that might not prove quite the dividing line they expect.

Why? Because according to data unearthed by the Financial Times in April, out-of-pocket spending on healthcare in the UK is now almost up at the level of the US, and hundreds of Britons who can’t really afford private care are crowdfunding it.

That worrying trend amongst the least well-off comes on top of widespread middle-class adoption of Bupa, Vitality, and other medical insurance providers. And who can blame them? Even if you’re not facing a life-threatening wait for urgent care, the day-to-day experience of using the NHS is so often soul-destroying.

Perhaps all this does boost Labour, overall – one informed watcher of the opposition harbours a pet theory that they tend to win power when the average income of private medical insurance buyers falls to a certain level. Given the extraordinary level of the tax burden, voters can be forgiven for resenting having to pay for a service which, according to the teachings of the de facto national religion, should be free.

But in truth, they are #NHSHeroes, making outsize contributions to the health service through their taxes and then effectively paying again to go private, freeing up its scarce resources for people who need it more. Given the woeful state its in, the Prime Minister could do worse than encouraging more of those who can afford to do so to step up and shoulder the burden of their own care. 

As I noted in a previous piece on this subject, part of the reason the UK spends less on healthcare than neighbouring European countries is because of our (fraying) insistence on the NHS being strictly publicly funded. That attitude serves to lock out private investment, whether by companies or individuals, and reduce the amount going into the system to the point where the ‘winter crisis’ is an annual event. 

This is a persistent, structural problem with the way the NHS is organised and funded: there is simply only so much cash that politicians can realistically raise through taxation and give it.

Its supporters try to sidestep this, insisting the health service would work if ‘properly funded’ or claiming that other systems don’t perform better (if they only have the same amount of money to spend). But that’s not much more credible than saying the American system would work if only everyone could afford it.

The attitude of some of the NHS purists is actually one of the best examples of ‘levelling down’ in British politics. They would genuinely rather that everyone queued for the same poor system than tolerate a ‘two-tier’ one that delivers better outcomes.

Even if you don’t embrace the idea of a mixed system where private provision cross-subsidises public services – which is happily starting to happen in the NHS – there is an obvious public benefit in diverting demand away from an overburdened system. Just as the first question for those who’d abolish private schools is ‘Where are you finding the money for 600,000 extra pupils?’, NHS purists need to be pressed on how they would cope with even more additional patients.

As it is, the NHS is going to need more and more money just to stand still. Inflation is going to push up the wage bill, whether ministers like it or not. We have an ageing population, and one that consists mostly of people convinced they have already paid in for everything they think they’re due, despite owning the great bulk of the nation’s wealth in the here and now.

Ministers are in no position to mount a head-on assault on the cloying myths of 1945. But they could take sensible measures to try and gently encourage more people to start making provision for their own care. Why not reverse New Labour’s decision to abolish tax relief for medical insurance, and extend the policy to working-age people?

Perhaps the Treasury, staring down the barrel of a fresh round of austerity, would squeal at the cost. But how much more does it cost the state to treat someone on the NHS – especially if their condition gets more serious due to the endless delays?

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Henry Hill is Deputy Editor of ConservativeHome.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.