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Is The Current Uk Health System Working?

Economics essay

Date : 20/10/2012

Author Information

Alex

Uploaded by : Alex
Uploaded on : 20/10/2012
Subject : Economics

"Governments never learn. Only people learn." - Milton Friedman (1912-2006) Whilst this holds a certain element of truth about it, one question that should be asked is: how do they learn? It is easy to make this statement highly pejorative, but surely everyone will learn something different depending on their experience and their specific background? For instance, with the last Labour government`s policy of spending to the maximum which ultimately resulted in a huge debt of excess 1000 billion pounds (according to ONS 2010), there were bound to be those who benefited hugely from the changes in education, research etc. whereas others would have suffered greatly from the increase in tax that was required to fund the activities. Taking a more topical example, in the case of the civil unrest in Libya, those in favour of Colonel Gaddafi may learn to continue to fight for their beliefs, be it that the beliefs have been deemed crimes against humanity by the International Criminal Court, having been inspired by Gaddafi himself after he declared to public television that if necessary, he would "die a martyr" in order to rid his government of those opposing his regime. Yet, of course, on the other hand, for the citizens of Libya who have been adversely affected by the appalling lack of human rights and freedom, like the law that orders any formation of a new political party to be punished with execution which is reminiscent of the kind of enclosure that was forced upon the people living in Germany during Hitler`s leadership, they will presumably learn to never support such a regime. The essence of this clearly must be applied to the title of this piece, that being whatever stand is taken; no solution will ever appease everyone. On the contrary, an effort should be made to allow as much fairness across the public as possible; we know this is what the aim of the government is because their general target is to increase the living standards of those residing in the UK with one specific target being to reduce poverty across the country (learnt from Alain Anderton`s text book for A-level). Currently, the healthcare system has it that private health services are supplementary to the state-run NHS. So, usually, if a person is taken ill, they will visit a GP and get diagnosed to find out what they have been affected by and what treatment they should undergo. At the moment, the majority of the public will receive a discounted price for any medication (including prescri ption costs) needed compared to if they were to be treated by a privately owned clinic with certain patients taking these benefits for free (if one is under 18 or on Job Seekers` Allowance etc.). On the face of it, this stance is greatly beneficial to the less well-off of our society as with the lesser price, they will have proportionately more disposable income to spend on other necessities such as food and clothing. However, recently, questions have been asked of the efficiency of many parts of the system. In the UK, it is known that we have the worst statistics for breast cancer in Europe with a 4% rise in 2008 compared to the 2007 figure, totalling just below 40,000 women being diagnosed (using ONS figures from 2008). Moreover, breast cancer itself accounts for about a third of all cancers and kills over 10,000 women (again from the same statistics) each year so there cannot be any argument that this is one of the lesser concerns for health systems. Furthermore, for a country that deems itself to be one of the most advanced countries in the world, England is only languishing at 20th in the statistics for life expectancy behind other European competitors including France, Spain, Iceland, Belgium and Greece - all of which have privately-run healthcare systems. In addition, in 2000, the UK`s provision of healthcare (8.4% of GDP) was actually seen as 0.5% below average according to surveys conducted by the World Health Organisation. The main argument against healthcare being largely state-provided is that it means that there is barely any competition in the market for companies like Bupa, because they can never challenge the NHS prices to patients and no matter how well their services are provided, the public will be naturally-inclined to use NHS services which are cheaper. The effect of this is three-fold, firstly, the NHS can be as inefficient as it wants and it will still be able to monopolise the market for the aforementioned reasons and thus healthcare generally will be massively inefficient than it would be if there were many companies competing against each other to provide the best services. Secondly, now the private clinics will relocate themselves to other countries and hence boost this country`s health system which in the long-run could even be a factor for families and other businesses` from other markets to not settle in England which would mean that England would lose out on the respective assets, whether it be more labour or innovative business ideas that would have boosted the overall economy. Lastly, the fact that taxpayers` money must be used to fund the NHS involves a opportunity cost on Government spending on other sectors, for example, education and, the extra spending on the health sector has not even resulted in an increase in quality of services as proven by the stats above; even if one were to argue that not that much of tax revenue is used on the NHS, this is still a problem because it shows that not enough is being spent on it so the quality is that to match other countries. This leads to another consequence of having a state-run service because the recent economic climate has meant that it is a necessity to make cuts on the health sector whereas if it were privately owned, government funding may not have been the paramount source of money for the businesses and so healthcare would not have to be compromised as much (it is unlikely that health firms lose out on too much revenue because the demand for such services is inelastic simply due to the fact that people are always ill!). All this points to the direction of private services only functioning well as a substitute and not a supplement because all these problems would not be helped by having alternatives that are too expensive to be taken as a substitute (whilst the NHS is still there as opposed to the original question), and this implies that there should not be any NHS whatsoever. However, this view is countered if you look at the other side of the argument of looking at the several reasons why a state-run health service is helpful to an economy: as noted above, it means that poorer families may access treatments more easily and for a better price and therefore raises the standard of living; also, the NHS alone provides over 880,000 jobs (2002 figure from the Department of Health) which of course fits the government aim of reducing unemployment and absolute poverty; it can be argued that market failure to an extent is reduced because there is less chance of asymmetric information because there will be no motive for the dentist for example to provide more than is needed because he/she will not get any more money out of it. Whilst these are valid reasons for the NHS system to be utilised, it should be noted that even on this side of the discussion on whether on not the NHS should be privatised or not, there is no argument for having private services working alongside the NHS. So why is England the only country in the EU to have adopted the idea of having a mixed-economy style for the provision of health services? One worthy cause is that for treatments such as cosmetic surgery, only few and rich people would be willing and able to use it so having it run by the government where every taxpayer must contribute to its inclusion in the industry would be ridiculous considering that it is not a necessity for the average British citizen. Another point is that with the inefficiency of the NHS (mentioned earlier), private businesses who focus on delivering a high quality of treatment have a market because now people with severe injuries will be able to recover more easily than if they were forced to search abroad for appropriate care, although these cases are quite exclusive to the upper bracket of earners in England. As highlighted in a recent edition of the Economist, the gap between the efficiency of cost and quality in the NHS compared to other countries seems to only be widening as statistics such as the fact that the Aravind Eye Hospital based in several locations in idea is able to perform the same number of operations as the NHS for a miniscule 1.5% of the price; and that in Bangalore, India, only 42 trained surgeons are needed to pull-off 3,000 operations each year, something that the English system could not possibly match. These realisations are becoming clearer with every survey that is taken and it seems that now even the Government cannot continue their ignorance, yet still, they remain rooted to their typically conservative idealisms of changing as little as possible even though many experts are calling for more radical reforms. What they are trying to do is pass on more responsibilities onto GPs as well as dedicating a certain budget to each GP consortium with the thinking that GPs are in the best position, as they have the most interactions with individual patients, to make decisions on what is best for their patients. This is obviously a step towards a less state provided health system but problems for this potential introduction have been envisaged ever since it was first suggested at the beginning of the year that there will be more space for competition. One major concern, echoed by leading Liberal Democrat Dr Evan Harris, is that GPs themselves feel insufficiently trained to take on this extra weight of work on their shoulders, and so such steps are now being imposed in a more cautious and conservative manner after PM David Cameron was adamant in stating that competition will not be forced "just for its on sake", resulting in an ironically inefficient reform. In answer to the originally raised question, no one is expecting the NHS to suddenly become privatised by a simultaneous click of PM Cameron`s and Health Secretary Lansley`s fingers, but the mutual agreement between experts and these, to put in lightly, influential figures is that changes need to be placed in order to push the performance of this country`s health system above the likes Portugal and Greece who, with no disrespect intended, having GDP per capita (PPP) figures of $23,000 and $29,600 respectively compared to the UK`s $34,800 should theoretically not be benefitting from better healthcare services (from the CIA Worldwide Factbook). This is not saying the NHS is a failure, because there are advantages that have been outlined above such as the fairer implications on poorer households. Nevertheless, what is of quintessential importance is that the Government improve the NHS` efficiency sooner rather than later, perhaps by only privatising certain parts of the organisation that are underperforming, for instance, cancer diagnosis and treatments; or simply by not just hurling money at the problem and hoping it will go away (the graph above shows that the actual net expenditure on the NHS has increased yet the standard is still not high enough), but ensuring that it is spent in the most worthwhile manner, like improving the technology used in clinics so that waiting time is decreased. After all, as Winston Churchill once said, "Healthy citizens are the greatest asset any country can have". It is time for the Government to learn. 1,973 words

This resource was uploaded by: Alex