High quality, accessible, affordable healthcare and the role of the private sector

27 March 2013

Click here to view Damien Marmion’s keynote speech

The global economic and fiscal crisis now means that all health systems need to achieve value for money to “bend the cost curve” of rising health spending. Demand for healthcare is rising, driven by changes in demography, and morbidity and consumer expectations. As the IMF has claimed, “rising spending on health care is the main risk to fiscal sustainability, with an impact on long-run debt ratios that, absent reforms, will dwarf that of the financial crisis”. Not only is delivering high quality, accessible and affordable healthcare now a necessity for all nations, but for both public and private health services.

Public health systems are staring down the barrel of shrinking budgets and rising costs. Likewise the private healthcare market is facing an “affordability crunch” as the cost of insurance premiums continues to rise. Like in the NHS, continuing to deliver an affordable and high quality service demands a whole programme of reform to the private healthcare market.

Damien Marmion’s keynote speech set out three key levers of reform that can ensure the private healthcare sector can continue to deliver accessible, high quality and affordable healthcare. First, there needs to be a continuous challenge on quality and greater transparency about choices of treatments and outcomes of care. Second, insurers need to become more activist and intervene in the market to ensure patients receive the best care. Thirdly, there needs to be a relentless focus on value for money and increasing the productivity of providers.

There are crossovers in the reforms needed for the public and private systems. Both systems would benefit for greater transparency on costs and outcomes, and engaging patients through choice and shared-decision making. With workforce costs representing a significant proportion of health spending both the NHS and private healthcare need to find ways to maximise the productivity of clinical staff. More competition between providers and new entrants can improve efficiency, while both commissioners and insurers have a role in making services more responsive to patient needs.

But while improving the performance of the hospital business model is essential, the future mission of both systems will be to provide care for patients with chronic conditions. This will demand new business models and there was debate on whether private healthcare can provide more than annual protection for curable illness, such as a coordinated package of services for people with multiple chronic conditions. Private healthcare needs to bring forward new products and innovations to meet the changing healthcare needs and potentially take the role as an integrator of services.

While private healthcare provided a stimulus for the last Government’s reforms to tackle waiting times for elective care, so far it is the public sector that has been the first to respond to changing healthcare needs. The NHS has started the debate on transforming services and moving care out of hospitals. The opportunity for the private healthcare sector is now to take the lead in tailoring care around the needs of patients with complex multiple chronic conditions.

Reform lecture on “High quality, accessible, affordable healthcare and the role of the private sector” on 27 March 2013, with Dr Damien Marmion, Managing Director, Bupa Health Funding, Professor Paul Corrigan CBE and Nick Timmins, kindly sponsored by Bupa.

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