Now is the time for a health service revolution

Mrs May must seize the moment – privatisation and social insurance are the obvious remedies

According to a study published in The Lancet this week, South Korea is likely quite soon to become the first country where average life expectancy among women exceeds 90 years. Japan, Switzerland, and even France, are not far behind. Some further improvement is also forecast for Britain, particularly among men, but it is not nearly as big.

There are many reasons for these disparities – diet, lifestyle, genetic predisposition, and so on. But also cited is a much more worrying contributory factor – relatively equal access to cutting-edge healthcare.

There is not a healthcare system in the world today which is not in some form of crisis. All face the same challenges of ageing populations, rising expectations and spiralling costs. Yet the situation in Britain has grown particularly acute.

The shameful truth is that, on many measures, the National Health Service is falling short, so much so that it is being overtaken even by the likes of South Korea, which little more than 30 years ago was still a developing country.

This failure is no reflection on NHS doctors, nurses and support staff, whose dedication remains beyond reproach, or indeed the standards of medicine they apply. Rather, it is the structure they work under, stuck as it is with an outmoded funding model which fails to strike the right balance between supply and demand, and seems politically immune to meaningful reform.

As a share of national income, we are simply not spending enough to deliver the healthcare voters demand. Other countries do better.

Rationing – by way of lengthening waiting times and slow adoption of new treatments – is already a reality as limited resource is spread ever more thinly. The pressures on health spending from ageing and chronic disease, moreover, threaten to completely overwhelm the public finances in the years ahead, absent of steep tax rises or spending cuts elsewhere.

We seem to have the worst of all worlds; a system which is both failing its users and is gobbling up a progressively rising and entirely unsustainable share of tax pounds. The system is at breaking point, but there is no sign of the Government acting to mitigate the unfolding train crash.

There is another Budget in less than two weeks’ time. Philip Hammond, the Chancellor, has told MPs that with the economic uncertainty of Brexit looming, there is no money for anything – no money for either tax cuts or spending increases. No doubt something will, none the less, be found for the NHS; it always is. But he’s not wrong in his diagnosis. Nearly 10 years after the financial crisis, Britain still has one of the biggest budget deficits in the Western world, together with a yawning great trade deficit to match.

Mercifully, we have full employment and some growth, yet the sort of money needed to patch things up at the NHS is simply not there. Nor would it work in the long term even if it was. Whatever is offered is never enough. Before long, sometimes within a matter of months, the NHS is back for more. The NHS is a leviathan whose appetite can never be sated.

The solution has been obvious for a long time. First, Britain needs to overcome its almost pathological aversion to privatisation of healthcare. Nobody would seriously suggest the NHS should be manufacturing its own drugs and equipment. These it buys from the private sector, together with a growing proportion of the services it offers. This process needs to go much further in pursuit of value for money.

But much more important, we need to shift from the present taxpayerfunded model to a compulsory system of social insurance, either privately provided as in Switzerland, or as in the Netherlands, raised and administered through the state. Basic, top-class healthcare would remain universal – low-earners would get better treatment than they do today – but citizens could choose to pay more for higher levels of cover. The effect would be to ensure both that a higher proportion of national income is spent on healthcare, and that it becomes subject to more realistic expectations. The notion that healthcare, unlike almost anything else, is somehow “free”, creates its own insatiable demand.

Without urgent action, the outlook for both the NHS and the public finances looks grim. With no political opposition to speak of, there could scarcely be a better time to seize the moment and drive through the modernisation in healthcare funding the country so badly needs.

The great irony is that Theresa May’s very political hegemony makes her as much a prisoner of the NHS as her Labour opponents. She daren’t touch it for fear of damaging what is for the moment a politically unassailable position.

Her “one party state”, governed by the people for the people, depends as much on embracing our “precious” NHS as it does on delivering a successful Brexit. And so we beat on, falling ever further behind in our healthcare and life expectancy.