All questions

The healthcare economy

i General

Approximately 11 per cent of the UK population has some form of private medical cover, although this is rarely comprehensive, and cover is not usually provided for accidents and emergencies. Some people also pay for specific private treatment, such as elective surgery or physiotherapy, where there may be a wait to receive such treatment on the NHS.

In England, NHS hospital treatment and primary care is free at the point of use to those ordinarily resident in the UK. It is funded through general taxation and national insurance deducted from salaries. There are fixed charges for certain items of NHS care, such as prescription medicines and dental treatment. Exemptions from these charges are available on the basis of age, income or certain medical conditions.

As a current member of the European Union, UK nationals have reciprocal arrangements with European Union states. These arrangements will cease in the event of a no-deal Brexit, although the government has expressed a desire to maintain the current arrangements.

The regulations that set the legal framework for cost recovery from overseas visitors changed in 2017; it is now mandatory to collect payment, in advance of services, unless treatment is immediately necessary or urgent.

The role of voluntary or third-sector providers in healthcare in England is limited, given the availability of NHS care, but one particular area of charitable provision is hospice care.

ii The role of health insurance

Some UK citizens opt to have private health insurance, often as a tax-efficient employment benefit, but it is not compulsory. EU nationals living in the UK and not employed are required to have comprehensive sickness insurance, and those eligible for overseas visitor charges may rely on insurance. In addition, those applying for certain types of entry clearance or leave to remain in the UK must pay a surcharge of £300 to £400 a year to use NHS services.

Private health insurance is available in a variety of forms, including access to private specialists and hospitals, or as a rebate for time spent in NHS care.

iii Funding and payment for specific services

Which services are routinely commissioned by NHS England or a CCG is substantially informed by evidence-based guidance and advice issued by the National Institute for Health and Care Excellence (NICE).

NICE has various powers to produce guidance and recommendations to NHS bodies on care pathways and technologies they are expected to provide. NHS bodies are legally obliged to fund treatments recommended by NICE's technology appraisal recommendations; however, other guidelines do not have the same level of authority.

For example, NICE guidelines recommend that three IVF cycles should be offered to women under 40 years of age who have been trying to get pregnant naturally for two years, or who have had 12 cycles of artificial insemination. However, the final decision about who can have NHS-funded IVF in England is made by local CCGs, whose criteria may be stricter than those recommended by NICE. NICE's role is to assess the clinical and financial efficacy of the technology.

For cancer drugs, the Cancer Drugs Fund (CDF) is another option at the end of the NICE technology appraisal process. The CDF acts as a managed access fund where more information is required to determine clinical effectiveness. A budget impact test also applies for certain technologies over the first three years of a technology's use in the NHS. If the budget impact exceeds £20 million, in any of the first three years, NHS England may engage in commercial discussions with the company to mitigate the impact on the rest of the NHS budget. The first reported example of this was Keytruda, where MSD agreed a substantial confidential discount before it was approved in 2018.

In some cases, further funding is available through Individual Funding Requests (IFRs). Where NHS England's duty to provide health services is not met under NICE technology appraisal recommendations, individuals can request funding for treatment through an IFR. The law surrounding IFRs is discussed in the case of S v. NHS England.

As set out above, standard charges apply to a number of NHS services.

Primary / family medicine, hospitals and social care

The UK healthcare system is heavily reliant on primary care practitioners (general practitioners, or GPs) delivering family medicine and acting as gatekeepers to secondary and tertiary care, which in the NHS is rarely directly accessible, except in emergencies.

GP providers are normally independent businesses, providing services to the NHS under contracts with NHS England. While these are private law contracts negotiated between NHS England and the British Medical Association (acting as the representative of all GPs), many of the provisions are required under the NHS (General Medical Services Contracts) Regulations 2015 or the NHS (Personal Medical Services Agreements) Regulations 2015. Similar arrangements are in place for NHS pharmacy and dental services.

NHS hospitals and secondary services are run by local trusts or foundation trusts, which are independent of CCGs or NHS England. The relationship between them is contractual; trusts and foundation trusts are providers of services commissioned by CCGs and NHS England. Emergency services are almost exclusively available through the NHS because of the high operating costs. However, secondary or hospital care may be provided by either the NHS or private providers. Private secondary care may either take place in separate private hospitals, or private patient units in NHS hospitals. While it is not usually possible for patients using the NHS to see a medical consultant without first being referred by a GP, there is nothing to prevent this in the private sector.

It should be noted that social care is, at present, provided under an entirely separate legislative scheme by local authorities. However, there has been an increasing movement in recent years towards the integration both of different health services and of health and social care. In 2019, the government published the NHS Long Term Plan to focus on funding, staffing and the pressures of a growing and ageing population. A new service model is proposed with every patient having the right to online GP consultations. Expanded community health and social care teams are intended to create genuinely integrated teams, and new integrated care systems are to be in place nationally by 2021.

Healthcare in the UK benefits from a near universal Summary Care Record (SCR) for each patient, which contains basic information and is accessible by a range of NHS bodies. In England (and to some extent the rest of the UK), healthcare records are held at a local level by the patient's GP and the relevant hospital. Of GP practices in England, 98 per cent now use a system that automatically creates an SCR unless a patient has opted out. This can be accessed by professionals, and patients can see who has accessed their records.

The UK's data protection law has been significantly strengthened by the EU General Data Protection Regulation. Alongside this, NHS Digital provides a data security toolkit for organisations to measure their performance against the National Data Guardian's data security standards, which is required to be completed annually.