The pros and cons of privatising the NHS

Reform’s rise in the polls has seen a number of their policy proposals under the microscope and earlier this year, Nigel Farage called for an end to the NHS being funded through general taxation, arguing it “does not work”, and revealed a wish to change to an insurance-based health system.

Health Secretary Wes Streeting countered by saying this would privatise the NHS by the back door, reducing the NHS to “a poor service for poor people, with working people forced to pay to go private”.

The slide to the private sector could have already begun, however; the NHS already outsources its appointments more frequently to independent providers, said Alex Nichol on LBC. Since October 2024, the number of NHS appointments, tests and operations delivered by private institutions has “increased by almost 500,000 this year, now totalling 6.15 million”. This currently amounts to around 10% of elective NHS activity, experts said.

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So what are the arguments for and against the radical step of moving to a privatised health system?

Pro: more choice for patients

Around 16 million people, which equates to around a third of the working-age population, think that private medical insurance is “essential”, said Moira O’Neill in the Financial Times. However, only 8% of a sample of 2,000 UK consumers aged between 18 and 70 had bought private medical insurance in the last two years, creating a “gulf” between desire and ability for private healthcare.

The NHS is often seen as a one-size-fits-all system by its detractors, while a privatised service might allow patients to better choose where to be treated and what treatment to have.

Perhaps in a nod to this thinking, reforms announced by the health secretary earlier this month will see an overhaul of the NHS App to give patients greater choice over where they have their appointments and treatment.

The prime minister likened the digital reforms to having a “doctor in your pocket providing advice 24 hours a day, seven days a week”.

“This is not a new idea”, said Jim Reed on the BBC. “It’s been talked about for years as a way of relieving pressure on the NHS and cutting waiting lists”. However, there are still questions of how the network and rollout will be funded, and how long full implementation will be expected to take, fuelling the fire for larger, wholescale changes.

Con: less certainty over funding sources and costs

Opponents of privatisation warn that it will open the door to more cronyism and a lack of due process. Private companies are not held to the same standards as public ones, and do not need to publish accounts to show how they have spent funds.

Removing control from the NHS could lead to cracks in the healthcare system. In April, the Department of Health and Social Care investigated “billing irregularities” in the cataracts market, after private clinics were accused of having “artificially inflated costs for the taxpayer, performed unnecessary operations and incentivised high-street optometrists to refer patients to their services” said Shaun Lintern in The Times.

Critics of NHS privatisation have pointed to the Covid-19 pandemic as an example of how outsourcing contracts to private firms can lead to a lack of transparency. Former deputy chair of the British Medical Association, David Wrigley, said in 2020 on the BMA website that the then-Tory government had chosen to outsource to “scores of private firms” with “minimal oversight, governance or transparency”.

Pro: could reduce waiting times

Both the previous Conservative government and the current Labour one have made cutting NHS waiting lists a top priority.

In June, NHS England announced the waiting lists had fallen to their lowest numbers in two years, and the lowest in April since 2008. Numbers fell from 7.42 million to 7.39 million, the first reduction in 17 years, excluding the first year of the pandemic.

Using the existing private-sector spare capacity could be “key” to the government’s targets, said David Hughes in The Independent.

Though there has been success with using private practices to service NHS appointments, “caution is required”, said Ammad Butt on UnHerd. There are fears that the NHS could become “addicted” to this short-term solution: if it does, “the cost of procedures and managing backlogs will remain permanently high” and do damage in the long run. Staff would be driven away from the NHS system, able to “charge higher rates when working privately, even though the money may still be coming from the taxpayer”.

Con: could reduce quality and continuity of care

The late Professor Stephen Hawking warned that a move towards a “US-style insurance system, run by… private companies” would lead to “the establishment of a two-tier service”, where rich and poor received wildly different levels of care.

A 2023 review in The Lancet found “aggregate increases in privatisation frequently corresponded with worse health outcomes for patients” overall.

“The implications are that privatising the NHS is not corresponding with better quality care, and, starkly, that the inverse might be true,” said Ben Goodair, one of the review’s authors.

This extends to continuity of care as well. The argument goes that private firms will not carry on providing an unprofitable service any longer than they have to. This could lead to a lack of continuity, with some patients finding their health providers change during their treatment or that aftercare, such as follow-up physio after an operation, is not included.

Pro: could 'reverse the rot'

The NHS is as close as Britain gets to a secular religion. The moral argument for a public system which delivers free care to everybody, regardless of wealth or status, has become a non-negotiable in public debate. But this religious-like fervour has led to stasis and a disjointed set of short-term solutions that have brought the entire health system to the point of collapse, critics argue.

Commentators have highlighted the need for more generalist doctors into the system, with England’s Chief Medical Officer, Professor Sir Chris Whitty, warning of the risks of over-specialisation, said The Times. Additionally, Re:State, a health think tank believed that patients requiring several specialisms causes “gridlock” in hospitals, with doctors not retaining generalist skills to treat appropriately.

“To subscribe to the notion that the NHS is the best health system in the world, one must assume the government is uniquely qualified to deliver healthcare,” said Dr Michael Christopher in The Critic. Continuing in this vein would drive us to “second-rate healthcare in perpetuity”, unless major systematic changes are made, like a move to privatisation systems.

Con: public healthcare is more efficient

This may seem a surprising claim, given that the prevailing wisdom since the Thatcher years has been that state control is inherently inefficient and internal markets bring savings.

Although the NHS’s performance compared to the rest of Europe’s health services is a bit of a “mixed bag”, said James Maddocks on the NHS Confederation website. It is not a “consistently outstanding performer, nor is it consistently underperforming”, but by some “academic estimates” around costs, the UK outperforms countries such as Germany, France and Sweden.

A private healthcare system does not mean an instant cut in costs, as exhibited across the Atlantic. It is generally accepted that wealthier countries tend to spend more on health care per citizen than lower-income countries. Even by this metric, the US spends “far more per person on health” than any of its comparable Western counterparts, parting with almost a fifth of its GDP on health consumption in 2020, said health policy researcher KFF. According to the outlet, on average, Americans spent “$8,353 [£6,365] per person on inpatient and outpatient care, compared to $3,636 [£2,770] in peer countries”.

The debate on healthcare, though privatised, is just as fierce abroad, and by no means any simpler once a public healthcare provider is removed or avoided. In the US, the debate over healthcare was arguably “at the centre of the US government shutdown”, said Eric Berger in The Guardian.