It’s obvious that the NHS will only survive in anything like its present form if new sources of income and ways of reducing demand are found. Lord Warner is only the latest to suggest some sort of flat rate charge on patients.  We have had repeated calls for charges to visit your GP or increased prescription charges.

There is widespread agreement among NHS managers, and most doctors, that we should shift a lot of care for elderly medical cases out of hospital and into the community – and concentrate cases which really need hospital care in fewer bigger centres. These proposals are not always popular with local communities, who are very attached to their local hospitals, however poor they may be.  But even if we could close a lot of hospitals it isn’t clear that this would save money.

Charges at the point of use may be counter-productive.  Obviously even modest changes of £10 a month or £10 a visit would deter poor people from seeking help  with a medical problem early.  4.5 million British adults, have less than £10 a month disposable income. A high proportion of visits to the GP are associated with depression , and a lot of that is generated by financial problems.  But for people who are better off and can easily pay such flat rate charges they may generate a sense of entitlement – making the use of the NHS more like a consumer transaction.

The rising cost of the NHS is largely associated with increases in long term conditions, which relate primarily to unhealthy life styles.  Multinational corporations make a lot of money out of selling profitable unhealthy products, but the cost of the damage is born, as an externality, by the NHS. The NHS is the biggest mutual insurance fund in the world, but there is no reason why it should subsidise the anti-health behaviour of profit making corporations.  A solution to the NHS funding problem which both raised money and reduced the damage caused to NHS patients would be much more sensible than a charge on patients.

We already have a scheme which raises money for the NHS from business in the Road Traffic (NHS Charges) Act 1999. This too is a way of tackling the problem of externalities. Each time there is an accident, a motor insurer is legally obliged to inform the NHS, which will determine if it is liable for any costs.  In 2001 the scheme was raising £100 million a year for the NHS.

Perhaps we could introduce a similar system for “accidents” caused by the consumption of tobacco, alcohol, sugar and so on?  Supermarkets have excellent records of what they have sold, and to whom.  When a patient is admitted whose condition can be attributed to the sale of unhealthy products a charge could be raised against the retailers who sold those products, and they could then reclaim the charge from the manufacturers.  The build up of liability would be a powerful incentive to both retailers and manufacturers to change their behaviour.

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  1. duncanenright says:

    These are interesting ideas. Not least because they take healthcare debate outside the boundaries of the institutions and structures of the NHS and into a wider debate on a healthier society. One great way to reduce the cost of the NHS is to improve our health and help us all to live happier lives. Charges of this kind seem a very good way to re-engage with that argument. Similar work might be considered on fines for landlords of unhealthy properties and employers who don’t sufficiently safeguard employees from harm at work.

  2. Mark Fenton says:

    I think the issue of having charges is a Trojan horse. If we can get a £10 visit charge past people and a £20 a night charge, we can get more past them in terms of charges. But I also think it is too simplistic an analysis.

    I do believe that we need t rethink the way the NHS is delivered. Large institutions such as hospital bring problems, and keeping as much care in the community is preferable. Looking at the health services developing countries develop, and this includes the ones who are aiming for universal access, free at the point of delivery service, funded through central taxation, they’ve not all developed services around a large hospital.

    I think we need to engage differently, both government, NHS, clinicians and public, instead of the drip, drip, drip of the present system, running services into the ground. I do like the idea of a ‘surcharge tax’ on smoking, sugar etc..

  3. Claudia Hector says:

    Charges are a complete no no. The cost of commissioning has gone up enormously. Processing and protecting cash transactions from fraud and misappropriation cots a lot by itself. We don’t want the US system here.

    1. Mark Fenton says:


      I would fully support that there is no charge beyond central taxation, we only have to look at dentistry to see how well charging has worked out, but Isn’t Martin’s point that a system is developed to collect a ‘sin tax’, i.e. the amount of sugar etc., the person has consumed = an amount the sugar companies get additionally charged, thus raising funds for the NHS, rather than someone being charged?

  4. Surely the easiest and fairest way to do this is to increase the tax of every working person to the amount required

    1. Mark Fenton says:

      I agree it would be the easiest way, but there is part of me which says it would be devilish to see the companies squirm – surely worth a couple of those tax payers millions in court fees just for the entertainment value.

  5. Charging is a ‘zombie policy’ – proven to be counter-productive, intellectually dead – but resuscitated periodically by spokespeople for vested interests like Reform (funded by insurance companies and Lord Warner (extensive private health interests particularly in IT/telehealth). Let’s not give this rubbish any credence General taxation has been repeatedly shown to be the fairest and most efficient way of funding health. We should be highlighting how this think tank has furnished David Cameron with his key health advisor – not being fooled into thinking that the unelected Lord Warner gives them a veneer of cross-party respectabliity.

  6. Gabriel Scally says:

    It is silly isn’t it. Who pays the tax on sugar etc.? It’s the consumer, of course! It certainly isn’t the producer of sugar. Is that beet or cane sugar? Or maybe it’s corn sugar? Perhaps it’s honey? What about artificial sweeteners?
    We’d surely be better fluoridating the water supplies and eating a healthy diet. Payment from general taxation is the only logical way to pay for healthcare.
    Daft to think we could distinguish between the calories from sugar, alcohol etc in a single individual and apportion healthcare costs of the individual accordingly. More bureaucracy and wasted administration.

  7. Martin Rathfelder says:

    So on Gabriel’s argument should we stop the punitive taxation of tobacco – because it’s the smoke who pays?

    1. Tony Jewell says:

      As Gabriel says we still need to optimise prevention (fluoridation) and still only spend something like 4% of NHS spend on it. Sugar is used a great deal in processed foods because it is cheap as well as affecting our tastes so some form of taxation should be explored. Cheap foods have lots of fat/salt/sugar in. We need tax/pricing which favours fresh fruit and vegetables. In terms of overall govt expenditure – we lived for several decades in the NHS on 5% GDP. Many European countries put in 10% so until we have achieved this proportionate spend we should not resort to patient charges.
      Tony Jewell

      1. Martin Rathfelder says:

        Agree with all that Tony says – but we haven’t managed to achieve any of these things over a long time, and we need to think a bit more about what we can do about that. Nobody in the SHA is in favour of patient charges as far as I know.

  8. Mervyn Hyde says:

    The NHS once provided more than it is currently delivering, i.e. Care Homes, Mental institutions, Cottage Hospitals, the list goes on, all of this was abandoned on the pretext that care in the community was the way forward.

    In hindsight most casual observers recognise that this of course has been used as a means to asset strip the state. Here locally we have have seen land previously owned by the NHS, sold off and are now large private housing estates.

    A way of identifying how this process has taken place is to look at the current proposals of re-organisation

    They are closing down Ambulance Stations and locating rapid response vehicles at standby points, this means cars sitting by the side of the road waiting to be called out, instead of returning to properly equipped ambulance stations with all the amenities and supplies necessary for a 21st century service. Hygiene and supplies being a fundamental problem, lack of administrative and learning facilities. Cars also are used as clock stoppers to meet time targets but can’t take emergency cases to hospital. We have seen a drop in personnel here in Gloucestershire due to station closures, which has taken our service to breaking point.

    This whole process is about downsizing, ready to sell off in small chunks to private sector buyers, it has nothing to do with efficient delivery of care.

    Even then the private sector fails abysmally as has been witnessed by the 111 service and Patient Transport service.

    Finally our NHS is being deliberately underfunded, not by accident but by design, our politicians are betraying us and it really is time for people to wake up. Money is no object as far as public services are concerned, the only thing holding us back is peoples ignorance to financial affairs and lying politicians who are selling our country from beneath our feet.

    This link explains exactly how we can afford unlimited spending on our health service, and Japan are already printing unlimited amounts of money into their economy.

    The Bank of England has also produced a document that now corroborates everything MMT says.

    So lets all stop believing that we can’t afford our public services and start planning for the expansion of the NHS, providing real jobs in the country with real wages that would in fact create real wealth in the economy at large, whilst serving people, corporate interests are destroying our economy, the public sector is the real driver.

  9. writing in total support of Caroline’s comment above
    Gabriel’s comment too is very interesting
    best wishes

  10. Martin Rathfelder says:

    The Compensation Recovery Unit recovers social security benefits in certain compensation cases and NHS costs in certain injury cases.

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