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How the growing intake of private patients will change the NHS


9:30 am - December 28th 2011

by Richard Blogger    


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Yesterday the government said it was planning to let NHS trusts raise half of income from private healthcare.

There are a few important points to keep in mind regarding this accouncement.

1. Some private income is useful
The private patient income (PPI) cap was imposed to limit the private income of NHS trusts. The cap includes the income from actual physical, in-the-flesh, patients, but it also includes income from other services like providing pathology or income from intellectual property.

The arbitrary nature of the PPI cap is unacceptable and needed fixing, but removing it entirely is not the solution. For a start, Intellectual Property should have been NHS IP and new techniques should have been used for all NHS patients, not just for those in the hospital that developed them.

Then there is the fact that the cap does not distinguish between income from services provided by NHS hospitals for private hospitals and income from private patients. There is clearly a difference between the two

2. This came from the Libdems
The Times, apparently have a leak that says that the PPI cap will be raised to a maximum of 49%. I guess this is a “compromise” by Lansley to his Lib Dem opponents.

The original policy in the White Paper (and in the Bill) was to abolish the cap completely. A “cap” of 49% will, frankly, have the same effect as abolishing the cap. This leak has lead to some quite hysterical comments. The Independent, for example, reports “more friction within the coalition” without realising that the 49% figure was Baroness Williams’ idea!

3. The impact on some trusts may be minimal
It may be that the large London teaching hospitals will attract more foreign patients (but sufficient to get 49% of their income from private work?), but it is unlikely that your average bog standard district general hospital will be able to do that.

Would self-pay patients be happy to learn that a proportion of the fee they are paying will pay for a patient to get the same care for free? I think not, and especially not if self-pay patients have been denied NHS care themselves (which will become increasingly the case in the next few years).

4. Private patients are costly
Lansley says: “If these hospitals earn additional income from private work that means there will be more money available to invest in NHS services.” — which he knows to be nonsense.

Those who naively believe Lansley’s statement seem to ignore the fact that private patients will not want to be treated with the hoi poloi, they will not want to have the same accommodation, nor be subject to the same waiting times, and all of this means that the trust will have to make the investment to provide a separate private patient unit so that the private patients will be kept separate from the great unwashed.

Current private patients are just too costly.

5. Private care will increase thanks to NHS cuts
The NHS cuts that is causing the impending NHS financial crisis will lead to Draconian rationing. CCGs will literally tell patients that they are not yet in enough pain for the NHS to pay for their hip operation, or they are not blind enough for a cataract operation.

Such patients, understandably, will look to their savings, or will cash in a life insurance policy, or raid their pension fund, indeed anything to find the money to pay for the operation they desperately need.

These are the patients who will become private patients in NHS hospitals (since NHS private rates will be cheaper than the private hospitals). This is how the NHS will be privatised. The irony is that two years prior those patients would have had the same treatment for free, and this free-at-the-point-of-use principle would have been preserved if they had voted differently at the 2010 election.

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A longer version of this post is at NHS Vault

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About the author
Richard is a regular contributor. He blogs more frequently at Conservative Policies Dissected.
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Reader comments


Not so sure about the last comment – I wish I could believe that Labour would have done it differently.

Would self-pay patients be happy to learn that a proportion of the fee they are paying will pay for a patient to get the same care for free?

Oh come on!!!

People are well used to their money being taken from them by the state in taxation and given to others less fortunate than themselves. So if they are being asked to pay a premium on the cost of their medical treatment to help pay for the treatment of others, it just feels like any other bit of compulsory wealth redistribution.

OK, it’s a tax on private healthcare but it is more like a sales tax than an income tax because it has, at least, a voluntary element. Anyway, the fat cats deserve to pay two or three times over for the privilege of dodging the NHS.

Don’t they?

@2

It’s a bit silly to assume that everyone who uses private healthcare is a “fat cat”.

As to 4 in the article, is this a fact? Have private patients been asked about this question? Do they give this feedback when choosing private hospitals?

OK in 2004 I had to undergo a major spinal operation it was carried out to save my life, I was taken to a ward in the hospital, out of seventeen beds I was the only NHS patients, The doctor a Mr Black came along and demanded I be moved at once since the bed was allocated to a lady who had an ingrowing toe nail.

I kid you not but the NHS has always allowed large groups of consultants weeks to have private patients, in my time I was moved three times to different wards and then a different hospital ending up with MRSA. Under labour this grew even worse and the laugh was at one hospital I was picked to answer questions to the Minister for the NHS who was visiting the hospital, they asked me was I in the Labour party, did I vote labour, did I back the Labour party.

They came around in the £2000 suits came to my bed to ask me what I thought about the food, I said it was cold when we had it as we were the last ward to get it, they said oh funny mine was great it tasted really good, when they left two nurses said yes their food was great the NHS had paid a Chef from London £20,000 and three waiters to cook their food as it was believed the hospital food was so poor.

Life in the real world of politics.

5. cripplekicker

“private patients will not want to be treated with the hoi poloi”

True. When we are sick and old, we want to be with people like ourselves. We don’t want to have to suffer the presence of loud, violent, inconsiderate, rude, vulgar and dirty members of the underclass visiting their fellow gang-member in the adjacent bed. In my experience, the fat and lethargic NHS nurses are so terrified of such people that they allow them to misbehave, knowing that they will leave – eventually.

As with education, so with heathcare. Those who can afford to go privately will do so because a small percentage of those who use the public service can and do make it disagreeable for all.

5. Private care will increase thanks to NHS cuts

“In line with the Government’s commitment to protect health spending, overall NHS spending will increase by 0.4% in real terms over the course of the Spending Review period.”

http://www.dh.gov.uk/en/MediaCentre/Pressreleases/DH_120676

And there was me thinking that a cut meant a decrease in spending.

2.

Their money taken from them? it’s not their money, it’s the state’s money, that’s what a fiat currency is, the only reason it has any value is because the state says it does and is willing to back that up with laws, regulation or force if necessary. If you don’t like that then fuck off to a country that will meet your fantasy of every man for himself.

@ James

Their money taken from them? it’s not their money, it’s the state’s money, that’s what a fiat currency is

That’s a joke, right?

Irony doesn’t work on the internet, we should both know that…….

@Richard Blogger, OP: “Would self-pay patients be happy to learn that a proportion of the fee they are paying will pay for a patient to get the same care for free?”

In the paragraph above this question, Richard notes that the most likely way to get more private patients is from foreign health visitors who would not be treated for free. For those patients, the question does not arise.

Richard Blogger, OP: “I think not, and especially not if self-pay patients have been denied NHS care themselves (which will become increasingly the case in the next few years).”

Aah, there is a logical leap. We are required to believe that treating more private patients in NHS hospitals reduces the opportunity to treat patients who can’t pay. OP is making the assumption that patients will pay to jump the queue.

Has that not always been the case? What has changed so that there are more queue jumpers? Assuming that there might be more queue jumpers (which I do not yet believe) paying extra money, is the NHS so inelastic that it cannot accommodate all?

Richard Blogger, OP: “CCGs will literally tell patients that they are not yet in enough pain for the NHS to pay for their hip operation, or they are not blind enough for a cataract operation.”

That bit explains the logical leap. Have you considered growing some testicles? If Dr recommended a similar case for treatment three years ago (and it helped the patient), then Dr has to do the same thing this year.

@5. cripplekicker: “When we are sick and old, we want to be with people like ourselves.”

Most folks welcome visits from the hearty and young.

Patients of all ages wish to be in a ward where there are people with whom
to talk. Comrades don’t have to be the same (same is boring) but not too unalike.

5. cripplekicker: “We don’t want to have to suffer the presence of loud, violent, inconsiderate, rude, vulgar and dirty members of the underclass visiting their fellow gang-member in the adjacent bed.”

I presume that you rode on a bus in 1982 next to a person with poor personal hygiene, thus establishing your perception of the underclass. I further presume that you lack exposure to the smelly and boorish upper class (of all eras).

5. cripplekicker: “In my experience, the fat and lethargic NHS nurses…”

I am speechless.

By lengthening waiting times the NHS is already pushing people to go private. This has already been shown to happen.

Quite a few people would be happy to mix with the masses – but be prepared to pay to jump the queue – others to control the time they have their procedures or operations as it may affect their work.

12. Frances_coppola

6 James

You are going considerably too far in your definition of fiat currency. Yes, currency only has value because the issuing state says it does – but if no-one believes what the state says, the currency is worthless, as I’ve explained on a previous thread. People have to be prepared to accept the state’s definition of money. And in order to do that they have to believe that it has value to them personally – in other words, that the money they receive in return for goods and services that they provide really does belong to them. Claiming that money people have earned through their labour doesn’t belong to them but to the state is a sure-fire way of getting them either to withdraw their labour or goods, or more likely to reject the currency in favour of something they can own – benefits in kind, for example, or external “hard” currencies that they can trust. Pagar therefore correctly says “their” money. The state may define the currency, but money belongs to people.

11. Frances_coppola: “The state may define the currency, but money belongs to people.”

I am further puzzled, Frances.

I have a gold coin in my hand. Oro. But that is worth much more than two pigs that I wish to buy. Somehow I have to split my Oro. Had I possessed a few silver coins, I could buy the pigs outright.

I need exchange. Honest exchange.

14. Frances_coppola

12 Charlieman

Fiat currency doesn’t involve gold or silver, of course…..

However, since you wish to barter your gold for someone else’s pigs, the value of those pigs is entirely defined by your need for them. You can’t eat a gold coin. If you are starving, those pigs are worth your gold coin, aren’t they? And gold coins don’t breed. If you want to start a pig farm, you may wish to trade your gold coin for two pigs on the basis that the future value of their offspring to you is considerably more than the initial exorbitant outlay.

There is no such thing as “absolute” value. Value is a judgement based upon your personal circumstances. Hence my remark that the state can only define the value of a currency if people accept what the state says. If they don’t, they will adopt something else instead which does in their view represent value.

15. the a&e charge nurse

We are no longer talking about IF the NHS should be privatised but rather how much privatisation there should be, or what form it should take.

I, for one, am astonished that this has happened – I mean, who saw that one coming?

In today’s news:

“One in four hospital patients would be better off if they were treated at home rather than on wards, NHS leaders have said. ”
http://www.telegraph.co.uk/health/healthnews/8980454/One-in-four-hospitals-patients-should-be-at-home.html

May be so but it is much easier to under-resource NHS healthcare services at home than in hospitals before that becomes a public issue picked up by the media. And, of course, in case anyone feels they really need to be treated in hospital, they can always pay to be there for treatment, can’t they?

@6. Bob B: “May be so but it is much easier to under-resource NHS healthcare services at home than in hospitals before that becomes a public issue picked up by the media.”

Not really. Health statisticians will quickly identify differences in outcomes for patients at home or in hospital. If the difference in care quality is sufficient to affect the pennies, it will get spotted.

18. Leon Wolfeson

@17 – And that’s why the Government is systematically shutting down every statistical measure which could be used for that comparison.


Reactions: Twitter, blogs
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  30. Voodoo polling, Clegg’s ratings recover amongst Lib Dems, and Miliband the managerialist: round up of political blogs for 24 – 30 December | British Politics and Policy at LSE

    […] looks at what the coalition’s announcement this week that it is planning to let NHS Trusts raise up to ½ of their income from private treatment might mean for trusts and patients. Richard Murphy at Tax Research UK says that the NHS cannot be […]

  31. VirtualResistance

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