Pretty much everyone thinks that the NHS is under funded; certainly the doctors and nurses do.  They hope to get more in their pay packets if the government spends more, and judging by the recent 20% pay increase promised to the consultants and the smaller, but still inflation busting, 6% that UNISON members got last month, the expectation is justified.  

It’s not quite so obvious why everyone else should agree.  They not only have to pay the extra taxes and wait in the NHS queues but when they finally meet a consultant they often find he’s more interested in telling them off for eating, drinking and smoking too much, than in turning up to his clinic on time and treating the problem they came with.   Some people wonder if they’d get more of the treatment they want by keeping their tax and buying some private insurance instead.  Offering to pay certainly seems to get doctor’s attention!

One way to see how things are going is to measure health service productivity; how much health care is actually being delivered per pound.   This is easier said than done.   Looking at health outcomes such as life expectancy is a poor way to do it.  Scotland and N Ireland have the highest health expenditure in the United Kingdom but the worst health outcomes.  It is difficult to judge whether this is because lazy Scottish doctors prefer sitting on committees to attending their clinics, or because Scottish patients have unhealthy lifestyles.  Counting crude health activity such as the number of patients treated is not much better since not all treatments are of equal benefit.  

This is why Professor Julian le Grand at the London School of Economics devised a new productivity index a few years ago.  He weighted hospital procedures by their cost.   By dividing this activity index by health service costs he gets a measure of health productivity.     The findings are interesting.  

A few years a go he reviewed what had happened to his productivity index after the Tory introduction of the internal market and GP fund holding.  In case you’ve forgotten, fund holding allowed GPs to choose where to send their patients, and the internal market made hospital income at least partially dependent upon how many patients they treated.   Not surprisingly health productivity increased steadily.   Doctors really did work harder, or at least more efficiently.  Those of us who worked in the NHS over the period can confirm that this was obvious on the ground. 

Le Grand has now updated his figures to see what happened after the 1997 Labour government abolished GP fund holders in 1997.   The results are summarised in this weeks Economist (22 June 2002).   No prizes for guessing what happened?   Productivity peaked in 1997 and has fallen increasingly precipitously since. 

Of course doctors say that although they are doing less, they are providing better quality of care.  Humph!  They would wouldn’t they?   The 10% of hospital operating sessions that are cancelled, and the even greater number that start late, or are under used, suggest otherwise. 

Jim Thornton 22 June 2002

Pretty much everyone thinks that the NHS is under funded; certainly the doctors and nurses do.  They hope to get more in their pay packets if the government spends more, and judging by the recent 20% pay increase promised to the consultants and the smaller, but still inflation busting, 6% that UNISON members got last month, the expectation is justified.  

It’s not quite so obvious why everyone else should agree.  They not only have to pay the extra taxes and wait in the NHS queues but when they finally meet a consultant they often find he’s more interested in telling them off for eating, drinking and smoking too much, than in turning up to his clinic on time and treating the problem they came with.   Some people wonder if they’d get more of the treatment they want by keeping their tax and buying some private insurance instead.  Offering to pay certainly seems to get doctor’s attention!

One way to see how things are going is to measure health service productivity; how much health care is actually being delivered per pound.   This is easier said than done.   Looking at health outcomes such as life expectancy is a poor way to do it.  Scotland and N Ireland have the highest health expenditure in the United Kingdom but the worst health outcomes.  It is difficult to judge whether this is because lazy Scottish doctors prefer sitting on committees to attending their clinics, or because Scottish patients have unhealthy lifestyles.  Counting crude health activity such as the number of patients treated is not much better since not all treatments are of equal benefit.  

This is why Professor Julian le Grand at the London School of Economics devised a new productivity index a few years ago.  He weighted hospital procedures by their cost.   By dividing this activity index by health service costs he gets a measure of health productivity.     The findings are interesting.  

A few years a go he reviewed what had happened to his productivity index after the Tory introduction of the internal market and GP fund holding.  In case you’ve forgotten, fund holding allowed GPs to choose where to send their patients, and the internal market made hospital income at least partially dependent upon how many patients they treated.   Not surprisingly health productivity increased steadily.   Doctors really did work harder, or at least more efficiently.  Those of us who worked in the NHS over the period can confirm that this was obvious on the ground. 

Le Grand has now updated his figures to see what happened after the 1997 Labour government abolished GP fund holders in 1997.   The results are summarised in this weeks Economist (22 June 2002).   No prizes for guessing what happened?   Productivity peaked in 1997 and has fallen increasingly precipitously since. 

Of course doctors say that although they are doing less, they are providing better quality of care.  Humph!  They would wouldn’t they?   The 10% of hospital operating sessions that are cancelled, and the even greater number that start late, or are under used, suggest otherwise. 

Jim Thornton 22 June 2002