A pluralistic and competitive healthcare system wouldn’t require a revolution

“The strategy of government ministers has been obvious. Starve the NHS of vital cash and resources then force patients to look to the growing private sector […] [H]ad the government carried out a direct onslaught on the NHS the political and public outcry would have been deafening. So their policy has been more subtle, and because of that, more dangerous. There is no doubt in my mind that the NHS is in danger and over the next five years we could find ourselves drifting towards American-type [healthcare].”

Given that barely a day goes by without somebody claiming the NHS was being ‘dismantled’ and ‘sold off’, you could be forgiven for thinking that the above extract was from one of today’s newspapers. But it is, in fact, from a Times article published in 1980. Old articles about the imminent demise of the NHS, and about secret plans to privatise it, often have an illusory ring of topicality, because this meme has been around for a long time. Periodic outbreaks of ‘NHS privatisation paranoia’ are part of the cult around the health service.

These outbreaks contribute to the perception that the NHS is politically untouchable, and in particular, that market-oriented health reform is a lost cause in the UK. Indeed, the author Deepak Lal dedicates a chapter of his book ‘Lost causes: The retreat from classical liberalism’ to the NHS.

But that perception needs to be heavily qualified. The British Social Attitudes Survey (BSA) shows that the general public is far more pragmatic about healthcare than the often febrile atmosphere of the political debate around the subject would suggest. A relative majority of respondents say they don’t particularly care whether their healthcare is provided by the NHS or by a private company, and a sizeable minority even actively prefer the private sector. This is a remarkable result given the problem of ‘social desirability bias’ in opinion surveys. One would expect that in surveys of that kind, people feel obliged to reaffirm their unconditional support for the NHS, even if they would not necessarily act accordingly when given the choice.

The public’s widespread pragmatism on healthcare opens up avenues for sensible reforms, and that is good news. As I show in my new IEA Discussion Paper ‘A patient approach. Putting the consumer at the heart of UK healthcare’, countries with pluralistic healthcare systems – in which patients enjoy ample choice between public, private for-profit and private non-profit providers – record some of the best health outcomes in the world. Places like Australia, Luxembourg, France, Japan, South Korea, Germany, Switzerland and the Netherlands have large, competitive private healthcare sectors, and in international rankings of health systems, they are almost always among the top performers. The NHS, in turn, remains an international laggard, and this is true across a wide range of measures from a wide range of sources. There is only one study (the Commonwealth Fund’s) which consistently ranks the NHS at or close to the top; yet in that study, only one category relates to health outcomes, and within that category, the NHS features once again as one of the worst performers.

NHS worshippers continue to pretend that the only alternative to nationalised healthcare was the US system, but the truth is that there is a range of interesting alternatives out there, which achieve better outcomes at comparable costs, and which are at least as equitable as the NHS. Taking inspiration from some of these alternatives, my paper sketches out a road map for reform, showing how we could move from where we currently are to a pluralistic system. 

It would not take a revolution. The ‘quasi-market’ reforms of the mid-2000s, which have introduced a greater degree of patient choice and a payment system in which funding follows patients, have already laid a foundation which can be built on. All it would take is straighten out inconsistencies in these reforms, and take them a couple of steps further.

The BSA results suggest that public opinion is not an obstacle to reform. The public is far more open to competition and private sector participation than most commentators seem to assume. The NHS may still be a ‘national religion’ of sorts, but at the grassroots level, it has become a reformed and almost secularised church (even if the remaining fundamentalist sects attract most of the media coverage). The reform agenda developed in my paper seeks to build on that, and turn that erstwhile stern national religion into a relaxed multi-faith room.


Dr Kristian Niemietz is the IEA’s Head of Health and Welfare, and author of the related IEA publications ‘A patient approach. Putting the consumer at the heart of UK healthcare’, ‘What are we afraid of? Universal healthcare in market-orientated health systemsandHealth check: The NHS and market reforms’. 

This article first appeared on Conservative Home


Head of Political Economy

Dr Kristian Niemietz is the IEA's Head of Political Economy. Kristian studied Economics at the Humboldt Universität zu Berlin and the Universidad de Salamanca, graduating in 2007 as Diplom-Volkswirt (≈MSc in Economics). During his studies, he interned at the Central Bank of Bolivia (2004), the National Statistics Office of Paraguay (2005), and at the IEA (2006). He also studied Political Economy at King's College London, graduating in 2013 with a PhD. Kristian previously worked as a Research Fellow at the Berlin-based Institute for Free Enterprise (IUF), and taught Economics at King's College London. He is the author of the books "Socialism: The Failed Idea That Never Dies" (2019), "Universal Healthcare Without The NHS" (2016), "Redefining The Poverty Debate" (2012) and "A New Understanding of Poverty" (2011).