Key findings:

• New IEA research finds that if UK cancer patients were treated in Germany, rather than on the NHS, more than 13,000 lives would be saved each year. Well over 5,000 more stroke patients would survive.


• The NHS is an outlier internationally in being over 90% in state hands. In France, Italy and Australia the private sector accounts for a third of hospital sector.


• IEA report recommends emulating best elements of various European healthcare systems, whilst retaining universal healthcare access, to save lives.

The quality of care provided by the NHS is falling way behind that of Social Health Insurance (SHI) systems in Europe and beyond. On almost every measure, SHI systems consistently outperform the NHS, while still providing universal access to care. Despite this, there is no serious consideration of introducing market-oriented measures in the UK; too often our policymakers seem to assume that the only other alternative to a nationalised system is the American system, which despite costing taxpayers a fortune and having massive insurance premiums, still doesn’t provide universal coverage.

New research from the Institute of Economic Affairs recommends that the UK looks to ‘cherry pick’ the best elements of the Swiss, Dutch, Belgian, German and Israeli healthcare systems, whilst retaining universal access. Proposals include opening the market to both non-profit and for-profit insurers, and the introduction of tax rebates for patients wishing to opt out of NHS care.

Poor NHS performance is costing thousands of lives a year:

Despite the UK’s healthcare system religiously being heralded as ‘the envy of the world’ in this country, the NHS almost always ranks in the bottom third in terms of performance – on a par with the Czech Republic and Slovenia.

For breast cancer, lung cancer and bowel cancer the five year survival rate in the UK is the lowest among high-income countries. For prostate cancer it is lower than most developed countries and for melanoma the UK survival rate is about average.

These statistics can be translated into thousands of lives lost. If the UK’s breast, prostate, lung and bowel cancer patients were treated:

• in Germany instead of on the NHS more than 13,000 lives would be saved each year


• in Belgium instead of on the NHS more than 14,000 lives would be saved each year

If the UK’s stroke patients were treated:

• in Switzerland instead of on the NHS more than 4,300 lives would be saved each year


• in Germany or Israel instead of on the NHS more than 5,000 would be saved each year

Suggested NHS reforms

The quasi-market reforms of the 2000s should be built upon to improve patient choice, strengthen the self-governance of providers and enshrine the principle that money follows the patient.

• Healthcare reform options considered ‘radical’ in the UK are normal in many other western countries. The majority of developed countries have some form of cost-sharing system.


• Patients should be free to choose what Clinical Commissioning Groups (CCGs) they use instead of having to register via a GP; or they should be able to switch to non-NHS commissioner-insurers if they see fit, giving them the ability to select based on their preferences in exchange for a tax rebate.


• Referral practices should be changed so that a letter of referral from a GP works as a voucher for the patient to use at any provider of their choice with the relevant service. This is because while on paper, patients have had free choice of provider since 2008, in practice, many GPs have simply continued to refer patients as they see fit.


• We should move to a pre-funded system where individuals become healthcare savers, with CCGs and non-NHS insurers required to build up old age reserves for every member below a certain age. This would reduce the financial burden on the working-age population in the long run.


• CCG activity should no longer be driven by geographical boundaries – they should be able to negotiate and contract with providers up and down the country, and, indeed, internationally, depending on demand.


• CCGs should be more like social health insurers – giving them the freedom to develop their own profiles & merge or demerge with other CCGs where necessary – allowing for market discovery to see what works best.


• The market should also be opened up to private non-profit and for-profit insurers.


• The reach of activity-based payments should be extended, and the tariffs should be set so that the vast majority of providers can be fully self-sustaining on the basis of tariff revenue alone. Assigning funding based on activity would incentivise providers to attract patients and would mean that patients effectively allocate funding via the choices they make.

Commenting on the report, author Dr Kristian Niemietz, Head of Health and Welfare at the Institute of Economic Affairs said:

“The NHS’s performance in terms of treating some of the most common and deadly diseases in the UK is abysmal by international standards. But in spite of this damning evidence that major reform is needed to improve health outcomes, the healthcare debate in the UK remains insular and inward-looking. We pretend that the only conceivable alternative to the NHS is the US system. It is not. There are plenty of alternatives out there.

“We should be looking to learn from successful health systems abroad, where treatment for cancers, stroke and other common illnesses is far more effective, and which also offer universal access to care. The misplaced idolisation of the NHS is costing lives unnecessarily.”

Notes to editors: 

For media enquiries please contact Stephanie Lis, Director of Communications: slis@iea.org.uk or 020 7799 8909 or 07766 221 268

The IEA’s report: Universal Healthcare without the NHS can be downloaded here.

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems.

The IEA is a registered educational charity and independent of all political parties.