What’s Wrong With This Picture?

NHS (National Health Service) budget for 2007-8: £105.6bn.

Cost of buying every single one of the 60 million people in the UK private health insurance with BUPA at a decent level of cover: 60 million x £100/month x 12 months = £72bn.

Is it that simple, or have I missed something? (I guess Accident and Emergency must cost something; BUPA doesn’t have to provide that service.)

12 thoughts on “What’s Wrong With This Picture?

  1. Old people can’t get anything close to £100/month for a decent level of bupa cover. Even for younger people £100/month comes with all sorts of limitations which are fine for all but the most expensive patients.

    The NHS is more than the hospital cover BUPA offers: A&E, GPs, dentistry, mental health, etc. Totally private healthcare doesn’t work so well for the Americans.

  2. I suspect if the NHS didn’t exist, BUPA would cost a lot more. Lots of BUPA-insured people use a lot of NHS services as well – I certainly did when I was insured through work.

  3. Adam: This isn’t an argument for totally private health care. (I don’t know enough about the subject to have a view about whether that would be a good idea.) It just amazed me that the budget was so mind-bogglingly enormous. You are right – I had missed quite a few services.

  4. @Adam – “Totally private healthcare doesn’t work so well for the Americans.” Well, true, it’s pretty rough, but I still wouldn’t throw it away just yet. The obscene number of lawsuits here help to make healthcare much more expensive than it should be. There are doctors who can’t afford to stay in business because of cost of malpractice insurance. That’s what’s particularly broken.

    If somebody takes their sick child to Vanderbilt Children’s Hospital (one of the best children’s hospitals in the world) and they have no insurance and no money, they won’t be turned away. So in reality, we don’t really have “totally private” healthcare. We pay via Medicare and Medicaide to elderly and those with no insurance and without the adequate financial means to purchase insurance. So in many ways, the US is already not very “totally private”. We have plenty of government healthcare.

  5. I’d suggest it’s not a like for like comparison.
    As you rightly point out BUPA don’t provide A&E facilities, or indeed various kinds of critical care. When my wife was in hospital once, staff were telling a chap who had had a heart attack that if he went to a private hospital as he wanted they wouldn’t be able to care for him properly.
    Although I know from talking with nurses/midwives that the NPfIT isn’t exactly the most popular project in the world, I think there are some very valuable advantages especially electronic notes. My wife and I have had to wait in Resus for her notes to be sent to the hospital by taxi (of all things!) before they would move to the next stage of treatment, and that was our local hospital. Having notes on a screen would be a great reassurance on holiday.
    It’s also an interesting point made in the Undercover Economist, that the US government actually spends more per head on healthcare due to red tape than the UK with the NHS.
    It also depends on how long the system will be expected to last as we could then spread that cost over that period. Even 20 years would reduce the yearly cost to £5billion only!.
    And how many lives it may save with better access to notes to aviod conflicting medication?
    But yes, the figure is way out of my ability to comprehend, but then so are most total figures on a national level. A quick calculation of cost per head (pop source CIA World fact Book) gives a cost per head of £1,732. Still a lot of money but maybe not quite as big as 105.6 billion suggests!
    Tim

  6. BUPA couldn’t exist without the NHS; for a start, they’re not training the doctors and nurses. A lot of the medically difficult cases end up getting referred back to the NHS anyway. The private medical system in general is providing extras on top of what is offered by the national health system.

    If you have private insurance, you can get faster treatment for some non-urgent conditions as long as there are no complications, and you can recover from urgent treatment (provided by the NHS) in an arguably nicer environment. But you can’t get treatment at all for any sort of chronic or “pre-existing” condition, including age related infirmities and long-term disabilities. You can’t get any sort of emergency care, including complications that may arise during an otherwise routine operation; if that happens, the patient will get transferred to an NHS hospital.

    You could argue that if the NHS increased its budget by a factor of less than two, it could provide BUPA-level care to everyone, maybe. Even that seems fairly dubious though, just because of the sheer numbers going through the system. Extending BUPA to cover everybody in the way that the NHS does, including the most difficult cases and the most expensive treatments, would cost vastly more than UKP 72 bn per year, I would guess about an order of magnitude more.

  7. It is true and ought to be admitted that BUPA couldn’t exist in its present form without the NHS. However…

    When the state runs something, there are always factors missing that apply to private enterprises. Firstly, unless you commit a crime of abysmal malpractice, you can’t really get fired: there’s one enormous employer and one workpool, so there’s no real competition for jobs. If your manager fires you, just move to the next region and work for the NHS there instead. The NHS is short of staff and can’t afford to be choosy. Secondly, the only way the NHS can ultimately go bust is if the government goes bust. The money supply will always be there, so there’s no _real_ pressure (regardless of how many targets are set by the various levels of management) to be efficient; the only pressure is fake, internally applied pressure. Thirdly, it’s a monopoly supplier (unless you want to pay twice by paying your taxes AND buying private health care). Monopoly supply is the route to waste and mediocrity in almost any enterprise; it means that the best hospitals don’t survive whilst the worst die, because they’re all getting their money from one and the same pot, tax revenues.

    The problem is far worse than the 105billion / 72billion calculation that Gerv makes, because of course given the size of the NHS relative to BUPA’s clientelle, there ought to be massive economies of scale.

    In the last 5 years NHS investment has increased massively (as the politicians keep reminding us), but almost all of that investment went into increased wages, e.g. the monumental increase for GPs in the last couple of years.

    I live in a third world country. I don’t have health insurance – I pay as I go. The service I get is far superior to the NHS, because the places I go have to compete for patients – if their service sucks, their patients won’t visit them again. And that includes A & E, dentistry, etc.

  8. Insurance doesn’t cover chronic and pre-existing conditions, as noted by others, and it only covers you up to a certain level anyway. So if you have an expensive disease, and it costs more than $x to put you right, you have to find the rest yourself. Plus being required to pay a certain amount upfront no matter what.

  9. with BUPA all you are paying for is the chance to jump the queue on various operations. the surgeons will be the same people, working extra hours privately at vastly inflated rates. if anything goes wrong you will be passed on to NHS A&E, which is why private hospitals are always next door to NHS ones.

    paying that 72 billion in addition would be providing almost nothing extra, as the whole point of this queue jumping is that not everyone can afford it.

  10. Are you actually complaining about 68% efficiency in a government-run program? Or is there something I’m missing (since I don’t live there), such as that they don’t actually provide the service in question?

    Because, if a government-run program can manage 68% efficiency over the long term, that’s rather better than what might be expected, especially under a Western-style elected representative government.