Going private: what’s happening and is it a bad thing? – with Sarah Neville and Hettie O’Brien

• The Health Foundation (2023). Waiting for NHS hospital care: the role of the independent sector in delivering orthopaedic and ophthalmic care.

• The Health Foundation (2023). How the public views the NHS at 75.

• The Health Foundation (2022). Waiting for NHS hospital care: the role of the independent sector.

• BMJ (2023). Private providers see surge in demand as PM blames long NHS waiting lists on strikes.

• PHIN (2023). PHIN Private market update: September 2023.

• BMJ (2023). Evaluating trends in private equity ownership and impacts on health outcomes, costs, and quality: systematic review.

• NBER (2023). Owner Incentives and Performance in Healthcare: Private Equity Investment in Nursing Homes.

• The Guardian (2023). Private equity has its sights on the NHS – and with it our faith in public services altogether.

• The Financial Times (2023). Private equity groups bet on UK healthcare as NHS waiting lists grow.

Jennifer Dixon:

A record 7.7 million people are now waiting for elective care in England. With so many people waiting for NHS care, polls show deep public concern over access and more considering going private as a result. The private provider market meantime in the UK is healthy with increasing interest in it by private equity investors seeing opportunities. And the NHS itself is increasing funding to private providers to help get the waiting lists down. So are we slowly sliding towards a mixed model of health care in this country, and if so, is it a good thing or should we be worried?

Well with me to discuss all this I'm delighted to welcome my two guests, Sarah Neville, who is the FT's Global Health Editor covering the NHS in England and health care developments around the world. And Hettie O'Brien, who is assistant editor at the Guardian. Hettie, is currently researching a book investigating the role of private equity in the contemporary economy and public services. And this book called Diminishing returns is planned for publication in 2026. Welcome, both.

I think the first question is, we say going private, but obviously there's lots of dimensions to that: private insurance, the extent of private provision. Sarah, can you just chart some contours of when we say going private, what we mean by that?

Sarah Neville:

Well, I suppose what we've seen in the last few years is an increase both in self-pay and companies taking out private insurance for their employees, but also of course, a very articulated role for the private sector in working with the NHS to help to ease its capacity problems. So I think it's been a sort of two-pronged development, really both us all as individuals in many cases making the choice to go private, but also perhaps us as NHS patients having a greater chance of being sent to a private hospital for an elective procedure than we have had now for some years I would say.

Jennifer Dixon:

And just looking at those who privately pay, I mean the figures I was looking, it's always hovered around between 11% and 13%, hasn't it for quite some time. But I've only just seen there's one report from Statistica, which seems to show a massive jump to 22%. Have you seen any other figures like that, that could just be a one-off?

Sarah Neville:

Well, I did see 16% being mentioned, which did seem a sort of meaningful rise from, as you rightly say, what had been the average of 10 to 12%. And I think it's interesting, not just the sort of quantum as it were, but the kinds of private care that people are seeking out. One thing that I think has grown very significantly is people getting appointments from private GPs, which is totally intuitive I guess when you think about how hard it is to get an appointment in a timely way with a GP. But I thought that was interesting. I think that's an area that characteristically we as Britons haven't gone private for. But I guess it reflects the fact that general practice is teetering and in previous NHS crises, general practice has held firm, but now it's seriously feeling the strain, isn't it? It's no longer the kind of safety valve it always used to be. So I guess it's not surprising that that is driving people who can afford it into the private sector, even if it's just a sort of one-off consultation.

Jennifer Dixon:

And I was looking at the figures that self-pay is still a relatively small part of market and actually its share is shrinking, because of the rise in insurance, those covered by insurance. Hettie, I don't know whether you've covered any of this in your work in the Guardian. I know you look at ownership, but have you looked at all at the insurance market or indeed the self-pay?

Hettie O'Brien:

Not so much from my work at the Guardian, but in the process of researching this book, I've definitely been looking at patterns of ownership with health care. And one of the really interesting things is if you look at this over a longer time horizon, the UK actually comes out as the country with the fastest rise in spending on out-of-pocket health care and private health insurance, I think of any G7 country and it's something like that as a proportion of GDP has quadrupled since the 1980s, which is really quite surprising. As Sarah said the kinds of elective procedures and things that you might be getting when you go private are changing, but so is the type of person who is perhaps going private as well. I don't think it's something that is only things like cosmetic surgery or hair transplants or any of those kinds of things that it perhaps used to be.

And I think actually what you're seeing now is much more routine elective surgery, diagnostic scans, as you said, GP appointments, the kinds of things that you'd normally get on the NHS. But I suppose the background context of that really is just waiting lists and people, in many ways I'm sympathetic to being anxious and living with pain and thinking, ‘God, I just really want to get an appointment, and I can't.’

Jennifer Dixon:

I mean, I was looking at the figures of the volumes going through private providers by private payers, people who are covered by insurance. And mostly admitted to hospital for ask for cataracts. So that's obviously waiting lists. But chemotherapy is another one, which is quite interesting. And as you say, diagnostics up the GI gastroscopy, those are the top three which are by far and away the biggest volumes. And of course, looking at the private hospital providers, obviously if people are buying insurance then you'd think business is booming for the providers. So there's still only a small number of companies at the moment. Well firstly, the size of the private hospital market now, it's still only by my reckoning about 9,000 beds compared to 120,000 in the NHS, is that what you were understanding is Sarah?

Sarah Neville:

I mean, I don't have the numbers at my fingertips, I'm afraid. I guess the sort of key thing is that most private hospitals aren't able to provide intensive care. So right away that limits the kind of procedures one could really safely undergo. I mean, I think people are not on commonly transferred to ICUs at neighbouring NHS hospitals when things go wrong. But I think we have to perhaps remind ourselves that by and large we're focusing on relatively low-risk electives in the private hospital sector.

Jennifer Dixon:

Yeah, so that's only a small share as you say. But that 9,000 is actually is not a peak. The peak actually was 25 years ago looking at the figures, so at 14,000. So it's not exactly been exploding in size yet. Although of course, if there's more demand then we shall see. And looking at the market, it's sort of the bulk of it. 70% of the market seems to be from four providers Spire, Circle, which I think is now been agreed to be sold to Pure Health, Nuffield, HCA and Ramsay are the main ones, Hettie.

Hettie O'Brien:

Yeah, I mean, I think it's really interesting what you said about beds, because actually the NHS's own spend on private provision as far as I understand it, so that would I guess mean the contracting out of services and also things like chemotherapy is not actually rising as half as much as self-payment is rising. So I think most of when you're talking about NHS privatisation, it would mostly be really in the self-payer side of things. I mean, the two big companies are Spire and HCA. So Spire used to be owned by a private equity fund called Cinven and is now the largest publicly-listed private hospital group in the UK. And it grew out of Bupa, I believe. And I was looking at, I mean, in the first 6 months of 2022, it took I think around 170 million from patients paying out their own pockets. And that's the sort of one-off procedures, which was nearly as much as it made in the whole of 2019.

And then HCA, which is Hospital Corporation of America, which is the largest private and non-listed health care group. And that's a really interesting company, because it was a subject of this huge takeover in the mid-2000s and it was acquired by a consortia of private equity firms and there was quite a lot of controversy around this, because it paid huge dividends to its new owners. And then when they sold it, they made about, I think one of them, which has been capital made about 10 times its initial investment.

Jennifer Dixon:

Very interesting. The other point that I found out recently is in private providers, they provide about the same volume of care to private payers as they do to the NHS. So the NHS is about half of their market, so it's a huge part of their business now, which is also very interesting. But nevertheless, the whole volume of beds, if you like in the system is still not as it was 25 years ago, although that might change of course. So just moving on, I mean you both mentioned this, the NHS use of private providers, this is where the NHS pays for care. And so, NHS patients have a right to choose point of referral. So the kind of volumes, so the NHS is odds are, what is it, about £150bn, maybe a bit more than that. So about 14 billion pounds was spent in the private sector just before the pandemic, mostly for elective, but obviously some other things like mental health.

But there has been a growth in elective care since the 2000s. Sarah, I think you wrote a piece on this, did you not, about the volume of growth in the private sector for NHS-funded care?

Sarah Neville:

Yes, I've written a few pieces recently looking at that. I mean, I guess one of the most interesting things is the way in which both the government and the Labour Party are now embracing the choice agenda in a way that they haven't nearly so explicitly for many, many years probably since the debacle of the Lansley reforms. And when you think that Rishi Sunak has had several meetings of an elective task force, which really has at its heart the notion of making use of the private sector, I think it's sort of quite startling in a way how quickly the rhetoric and the argument has moved. And when you look at Labour particularly, it's only 4 years since the leader of the Labour Party was fighting a general election on the notion of the NHS being for sale and being sort of on the table in a prospective trade deal with Trump and now you have Wes Streeting, Keir Starmer embracing it, very much talking about the private sector as part of the tools for the armoury for clearing very long waiting lists.

So I think if you look at that sort of unanimity, there is a real inexorable momentum to an increasing role for the private sector in delivering NHS services.

Jennifer Dixon:

And this kind of mirrors the 2000s, doesn't it, Sarah, when there was this big push on getting waiting times down and to their credit, New Labour did, and they could not have done that without the use of the private sector. You could argue we're in the similar position now.

Sarah Neville:

Now one thing that I do think is an interesting difference is that in the New Labour era, the argument was made by Tony Blair and others that use of the private sector would sort of ginger up performance would raise quality in the NHS. And I don't hear that argument being made. I think it's a much more pragmatic cast to the debate about the use of the private sector now it's simply that we badly need that additional capacity. I mean obviously, there were a number of other reasons that Blair and Brown were so successful in getting waiting lists down, not least, very much more ample financial resources than we have now and a much tighter armoury of targets.

Jennifer Dixon:

Targets and terror I think was the-

Sarah Neville:

Targets and terror as [inaudible] beautifully put it. Yes. But certainly the use of the private sector of those independent sector treatment centres was very much a sort of emblematic Blair era policy, wasn't it?

Jennifer Dixon:

It was, and obviously, I was looking again about 30% of all hip replacements are done in the independent sector NHS-funded and 50% of cataracts. So it is huge volume, but overall, it's only about 8% of elective care is carried out for the NHS by the private sector. So it's still a share, but it's a growing share it looks like. And of course, from research earlier, we know that people who are more deprived tend to use less the independent sector for whatever reason. Probably comorbidities I suspect, and travel and preference, which was what the research showed. But that's worth watching, isn't it?

Sarah Neville:

It really is. I think that that risk of widening health inequalities is a factor here if the growth of the private use, the private sector does increase.

Hettie O'Brien:

I think one thing that is sort of worth mentioning about the kind of reliance on the private sector is something I'm really curious about is when we're talking about private health care is whether we're talking about the kind of infrastructure or the staff, because many of the staff are actually the same staff who are doing surgeries in the NHS. So there's an interesting thing in social care called the swan effect where essentially you have private companies that are building these very comfortable and luxurious facilities in areas where there's a big proportion of wealthy people who could potentially pay for their care fees, but because they can't necessarily get the staff to service those facilities, they end up, the staff who are in those facilities end up sort of peddling like mad under the surface. And so, I think there's a risk of a similar thing when we talk about private health care where you can build a lot of new facilities and certainly those are things that the NHS estate really does need.

But actually when it comes to the people who are staffing those, the doctor who will deliver your operation even in private health care will probably, almost certainly, be an NHS doctor. I wonder if there's almost a limit on expansion with it and use of that private sector, because it really is pulling on the same people who would be working in the NHS.

Sarah Neville:

I think we are unusual in this country, aren't we, in having basically a single workforce. I mean, there are undoubtedly doctors who work entirely in the private sector, but very much the majority do work in the NHS as well. So as you say, Hettie, the risk I guess is of hollowing out the NHS workforce in the pursuit of using the private sector more.

Jennifer Dixon:

And just going on to the other areas. So as you say, Sarah, these community diagnostic hubs, which I think was the focus of the Prime Minister recently, wasn't it, in following the Elective Recovery Taskforce review, I think you reported on this.

Sarah Neville:

Fascinating, yes, that over half of them are going to be funded by private sector capital. There's increasingly a sort of, I almost wanted to say I'm ashamed, I don't know if that's quite the right word, but a sort of willingness to embrace the role of the private sector and to acknowledge that private sector capital is needed given the dire situation on capital funding in the NHS, which has obviously been thrown into relief even more by the recent RAAC problems. So this is obviously a gain, it's pragmatism, isn't it? They need to get this funding from outside the Treasury funds as it were, but it nevertheless is striking, I think.

Jennifer Dixon:

There are various categories of private ownership aren't there? In the U.S., they have for-profit and not-for-profit being at least one broad category. But then we've also got these new private equity owners who are coming in and increasingly having interest. Now Hettie, I know this is your subject, so can you say a little bit about the growth of private equity ownership in health care?

Hettie O'Brien:

Private equity is quite an amorphous term in some ways, because it can cover a lot of different types of investors. So that could be private equity funds or asset managers or even some pension funds that have developed their own kind of in-house private investment arms. But I think from the perspective of understanding this in health care, it's probably most useful to see it as a sort of set of techniques that involve buying up companies and loading with debt and using probably higher amounts of leverage than you would otherwise expect. And I suppose, because these funds have quite privileged access to finance and a willingness to use financial engineering in order to extract value for the shareholders and investors, they can usually justify paying higher prices to acquire things like health care companies, meaning that they end up sometimes overpaying for those companies and loading those companies with debt in the process.

And I think there's something interesting about health care insofar as most funds are searching for businesses that have recurring revenues which generate cash, because cash can be used to pay down and service debt repayments and health care is obviously attractive for that reason, but it's also one of the few sectors that are really growing quite a lot in quite a low returns landscape and that's caused by a number of factors. So we have an ageing population, we've got people with growing number of chronic conditions and we've also got medical advances which mean that there is more types of treatment to spend money on. So I think if you're an investor looking at this, you'd see that health care would be a quite sensible thing to invest in. And I know there was that data recently covered in the ACTE that showed there have been 150 deals for UK health care companies within the past 2 years.

I suppose there isn't much research that's been done on this in the UK partly, because it's a relatively recent phenomenon. So we're still waiting for a time lag, but also that I think these investors are nibbling around the edges of health care. So you're seeing them motivated more I suppose by waiting lists. So going into things like self-pay, elective medical procedures, but then also because of those waiting lists, the government is saying we're going to open up our purse to the private sector. And so, you've seen there was a recent acquisition of a NHS staffing company that basically provides staff out of hours to the NHS that was acquired by a European equity fund. So I think we can probably see more of this and probably still quite a fragmented way, but I mean it's definitely a growing area of interest.

Jennifer Dixon:

And have you seen Hettie, similar interests by private equity investors in other parts of the public sector?

Hettie O'Brien:

Definitely in areas like utilities and water and so on. But I think when it comes to health care, it's both helpful and not helpful to look at the U.S., because the U.S. is actually very, very different to the UK in terms of its health care landscape. So I'm always wary about making comparisons, but certainly in the U.S. it's kind of really exploded. And there was a recent study by Joseph Brook that one covered in the British Medical Journal, which synthesised all of the existing literature on PE ownership in health care. And the findings of that were very interesting. So I think most of the literature that he was looking at was in the U.S., because that is where most of the research has been done so far.

Jennifer Dixon:

And when you say interesting, what do you mean? I was reading a few studies just talking about that the pursuit of quick money is not compatible with sound health care. Is that the basic bottom line?

Hettie O'Brien:

Yes. I mean, that's also what a couple of private equity investors have said to me. And so, the findings of that study were just that PE ownership was associated with increased costs with mixed to harmful impacts on quality with reduced nurse staffing levels and with also a deskilling of nurses. And I think the kind of critical line was that there would be no beneficial impacts of that form of ownership, but I think that makes sense when you look at who these funds are accountable to. So it's not to the public who are using these services, it's really to their investors. And ironically, many of those investors are actually pension funds who have a responsibility to the same elderly people who might be finding themselves at the sharp end of this type of ownership if they find themselves in a nursing home that's owned by a private equity fund.

On nursing homes, there is quite a lot more research in some ways partly because it's been going on slightly longer. And there's a brilliant study by Atul Gupta at the University of Pennsylvania who conducted research on private equity-owned nursing homes and he found that the ownership, that form of ownership increased early mortality in residents by around 10%. So that's quite a striking study, but I mean nothing has been done like that in the UK. So again, I think there were really important differences in those kind of contexts to be aware of. But it's really interesting when you look at that research in the U.S.

Sarah Neville:

And we did do some research, I remember probably a decade ago looking at the quality of private equity run care homes when groups have actually gone under as Four Seasons did some years ago. The question I guess is whether this growth in private equity involvement is going to prompt tougher regulatory action or is going to mean that a government, whether Conservative or Labour is going to actually cast a sort of sharper eye on this. And I interviewed Wes Streeting a few months ago and he told me that an incoming Labour government would strip private equity run care homes of public sector contracts if they didn't meet certain quality and value for money standards. So I thought that was possibly quite an interesting straw in the wind actually. If private equity does become an ever bigger part of the health and care landscape, perhaps that will increasingly attract the attention of the regulators and politicians.

Hettie O'Brien:

I think there's also another question which is around finding more stable forms of capital investment, because when you don't allow for that, then it does mean that there is an increasing turn towards riskier and more leverage forms of investments moving into that sphere. So I think it's two questions. It's first regulations and it's second, how are we going to finance this in a way that doesn't rely upon these particular financing models?

Jennifer Dixon:

Yes, that's a very good question. Some bald CQC ratings for existing private providers understanding they are about a fraction of overall NHS care and it can't really compare for like for like, but the CQC ratings were 8% of NHS providers outstanding, 8% of private providers outstanding, good, 66% NHS, 82% private, inadequate or requires improvement, 25% NHS, 9% private. And as I say, you can't compare like for like because the NHS is a far more complex in dealing with more complex cases, but they're not a million miles apart at the moment, but of course that can change, can't it if there is some detrimental ownership change. And Hettie, I think you wrote a nice piece in the Guardian recently, where I think you were referring to Germany as well with this trend of private equity.

Hettie O'Brien:

Germany's a really interesting example. When we talk about the U.S. for example, it's such as I said, a different health care system, but Germany has a health care system that is I guess the more kind of Bismarck model of health care provision rather than the Beveridge model and this long-running discussion in the UK about whether we want to move to a social insurance-based model. And so within that, it's interesting to see actually how much this form of ownership has taken off in particular sectors such as ophthalmology was the sector that a particular investigation in Germany was looking into. It was the German version of Panorama. And they found, and I can't remember the exact details off the top of my head, but they found some really quite shocking things. Ophthalmology and dentistry and people I guess problems of overtreatment. So people kind of incentive structures meaning that people were having operations or procedures that they didn't really need in order to essentially make money for investors.

And I think that's interesting, because it's taking place in the health care landscape that we would consider probably closer to our own than to something like America, which is often held up as a kind of horror story of health care.

Jennifer Dixon:

And well-regulated in Germany too, interestingly enough. And the other thing I wanted to ask you about, Hettie, is that you also said in the same article that hundreds of NHS consultants in England have become shareholders in private health care firms.

Hettie O'Brien:

So that was research for the centre of health and the public interest. It was found that a number of consultants have financial interests in some of the services they might be recommending. And I mean, there was a great piece on this recently in the Sunday Times about those kind of incentive structures that you might get when you have a private health care system. And so, I think that might have cited that same piece of research actually consultants who have shares in hospitals they send patients to and doctors receiving sees each time the equipment they owned was used were just a couple of the things that came up in that. And I think it's interesting, because when you think of some of the worst horror stories of private health care, which in the UK, but certainly there was a point in that piece made that there was a lack of regulation in terms of that sector such that doctors don't have maybe as much scrutiny as they would do within the public sector.

Jennifer Dixon:

Pulling back a bit, well, that's a very interesting picture of the landscape and things to watch, but now turning to what the public thinks. So we have an ongoing rolling programme with Ipsos, which has been polling the public. And they say 13% of the public report already paying for private care insurance and 22% said they weren't at the moment, but they were very likely to in future. 52% said they were highly unlikely. And the reasons why people who were considering it or planning to was for reducing waiting, particularly dental and physio, but also elective. 82% said gave that as a reason whereas only a quarter of them polled, mentioned quality or convenience, which is quite an interesting findings. And of the 13% already using private care and we polled, 33%, it's the first time that I'd be used private care. So that shows, doesn't it? A kind of warmth towards the possibility for those who can afford it?

Sarah Neville:

It does. Perhaps the question is are we looking at a seismic shift here in this country that has always been so concerned? I mean, I sometimes think possibly politicians have overestimated the level of concern, but certainly it's always been thought that the British public would run a mile from any sort of private sector involvement in their beloved NHS. But perhaps we are looking at a really sort of almost structural shift here. I guess the question though is will it outlast the current state of the NHS? I mean, unless we assume the current state of the NHS is essentially in perpetuity that we never will get back to an era of super-low wait times. But if we assume that eventually the NHS will strengthen and these long waits will be behind us, will people go back to the NHS or has something really changed here?

Jennifer Dixon:

Is it a structural issue? Is it there's been a structural shift since the pandemic? Or is it just a transitional thing because of the backlog? I guess if it's a transitional thing, the worry might be then is that people are just getting very used to both for those who can afford it, the cost and the kind of quicker access to private care, so that if the NHS did improve, would they want to revert?

Hettie O'Brien:

I'd be cautious of drawing from that the idea that the public's attitude towards private health care is changing in a more structural way. I mean maybe in time it will, but when you look at alongside the polling on people's sense of would I go private, there's also the polling on people's general support for the principles of the NHS and I think the Health Foundation's own polling shows that that public support for those principles is almost immovable. So it's a sort of sense in which people really do support the ideological basis of the NHS in the sense of universalism and access, but are almost going private out of desperation rather than consumer choice. And I think one thing that makes me think that is partly that there's been a huge rise in self payers, but from what I understand, not a rise of the same degree in private insurance. And if you were expecting that people would be desiring to buy out of the NHS altogether, then you'd also think that they would be paying for private insurance.

But really the big increase seems to me to be in the huge spike in people paying for individual one-off things, which would seem more suggestive of those people thinking, ‘Oh God, I really want to get this knee fixed or I need to get an operation,’ and then doing it, because they have no other option rather than because they're attitude towards the overall health services changing.

Sarah Neville:

I suppose the risk is that the better off start to feel less of a stake in the system. And if you look at what's happened with dentistry, where I think 50% by value is now carried out in the private sector, and you look at how hard it is to get an NHS dentist, you can see is that the shape of things to come, separate discriminatory services for poor people have always tended to be poor quality services. So is there a risk of that sort of getting baked in? I totally agree with Hettie that all the polling shows that the support for the fundamental principles of free at the point of use are ironclad, which is very encouraging. But when does the sort of pragmatic shift to the private sector almost become permanent in people's minds?

Hettie O'Brien:

Totally. And also there's a sense in which a similar kind of process has happened with social security. When a system becomes so conditional and so specifically targeted for only the most needy or the most disadvantaged, then the kind of overall support for that system really diminishes. So I think that's a really interesting point. And also, it makes me think that understandably some people have always said, ‘Oh, I'll go private because I can afford it,’ and that frees up space for somebody else, and that's coming from very often a good place. But it also, if you magnified that across an entire population, the people who could afford it would just be those who were opting out and you might end up diminishing that commitment to universalism.

Jennifer Dixon:

I mean, I suppose going back to the figures, the NHS is a giant compared to the private sector in terms of number of beds. So 120,000 in the NHS around 9,000 in the private sector. And also, because of that, the private sector just doesn't have the facilities for very complex care. So a lot of people with private insurance are getting the easy stuff on private insurance, but will have to depend on the NHS for very complex care. So they'll also be potentially users of the NHS and indeed are heavy users of the NHS.

Sarah Neville:

Perhaps it's a natural generational shift. People may well go private for one-off fast access when they're young and their care is not likely to be complex. But as they get older, as you say Jennifer, they'll increasingly need the complex care that only the NHS can provide.

Jennifer Dixon:

So I suppose just to sort of round up really, I guess the overall question is we can see an expansion and a warming of the public towards going private. Is this a good thing overall?

Sarah Neville:

Some of it we've already touched on. I think this rather sort of strange situation of having one workforce for the two sectors is worrying in terms of how it's very hard to increase use of the private sector without diminishing the availability of staff for the NHS. I don't know quite how one addresses that apart from perhaps through the development of more of a discreet private sector workforce. And I think there are actually some signs of doctors shifting over permanently to the private sector, but that is a disaster unless there are more people willing to join or able to join the NHS. I mean, I think the other aspect which we have to constantly guard against, the health equity aspect that poorer people, as you said Jennifer, there is evidence that they are less likely to talk for choice. I guess I'm just raising the negatives here. I'm not really providing solutions to them, but I think those are the sort of factors that politicians need to be thinking about as they encourage and give the green light.

Jennifer Dixon:

Yes, thank you for that, and Hettie?

Hettie O'Brien:

I think there's sort of three imaginable scenarios, and I was reading a really good paper recently by the Institute for Public Policy Research, which compares the kind of emerging scenario to one of the English private school system where you've got say a fifth of people who can get excellent health care, because they can afford to pay for it, but then other people who can't afford that. And that's not a great scenario. I mean, another scenario is dentistry, and if the whole of the NHS looked like how dentistry looks, I think would be in a really bad situation. I mean already you've got people not going to the dentist and the rise in DIY dentistry, because it's simply too expensive or because they fall outside the system and that it would obviously be really bad for health, but also just bad for society, because ideally you want as many healthy people as possible. And then I think the third, which is something that we already have again, is social care.

So you could imagine that the whole situation would look something like social care where you've got incredibly expensive two-tier system where beds are really difficult to find if you're in a poorer area and then are really plentiful, but very, very expensive in a more affluent area and lots of money is getting made at the top end of that, but we're ending up with a service that I think everyone probably agrees is not as good as it could be. Sorry, that's just a negative, isn't it?

Sarah Neville:

Neither of us have come up with-

Hettie O’Brien:

No!

Jennifer Dixon:

So I'm going to stick my neck out here. I mean, I would bet that this is a largely a transitional thing that we won't go back to the status quo ante. Actually, there will probably be a larger number of private payers in future and a larger private supplier market, but not huge is my prediction. The things to watch, I think, would be the incentives for the private sector to grow. And it depends on how the NHS pays them, given that the NHS is half of their market at the moment. We would have to watch private equity ownership, a side of these providers, just make sure that quality doesn't sort of slough off, that means tighter regulation probably, or at least higher scrutiny. I think the incentives for doctors you mentioned, which is a really good one, or at least to look for conflicts and to have examine that area. And the other thing we didn't examine, I guess, is if there is a certain size of private sector provision, which can have an impact on the prices that the NHS can control.

So there's probably an economist out there who can sort of tell us what the optimal curve is there. Obviously, the NHS is very effective to effective at cost control and actually it might lose some of that control for all if the private provider market becomes too big and it just depends on it too much. But the positives could be the type that you mentioned, Sarah, that we actually had in the 2000s, that actually having an alternative way of doing things, even for simple procedures, could ginger up the NHS bit more and have some welcome competition and then choice for patients of course as well. But bearing in mind your equity point. So I'm hoping that it's a manageable risk that could be containable without a massive structural change in future, but I don't see any lack of commitment to the NHS on either public or politicians' behalf myself, do you?

Sarah Neville:

No, I would agree. Yes. No, nobody is. I mean, I know there's been the flirtation in recent months, particularly with different forms of funding of the NHS, but I don't think anybody is seriously questioning its broad principles, whether patients or politicians.

Jennifer Dixon:

Indeed. So we must leave it there. Thank you very much to Sarah and Hettie for our brief tour around the private sector in health care. Thank you both. And also just to remind listeners that we will put some more information in the show notes as usual. So check those out next month. It is party conference season, so we are going to be looking at what the main parties are planning in health and social care policy. So thank you meantime to Sean and Leo at the Health Foundation for all their help, to Paddy and his team at Malt. And it's goodbye from me, Jennifer Dixon.