Healthcare in the UK
Dr Andrew Vallance-Owen MBA FRCSEdSpecialist Medical AdvisorHealthcare UK
Healthcare in the UK
• The National Health Service
• Primary care
• Private healthcare in the UK
• Public Private Partnerships (PPP and PFI)
Founding principles
The NHS was launched on 5 July 1948 and was founded on three core principles:
• that it meet the needs of everyone• that it be free at the point of delivery• that it be based on clinical need, not ability to pay
65 years later, these principles remain at the heart of the NHS and have been supplemented in the NHS Constitution
The NHS faces similar challenges to other health services around the globe
Money. Maintaining the quality of services within the hardest ever funding settlement since the inception of the NHS
Population change. In the UK, we live longer, but are becoming less healthy. Non-communicable diseases, like
diabetes and cardiovascular disease and their costs are rising sharply
Expectations and treatment costs. Patients rightly expect a higher level of service than in the past. The cost of medicines has
been growing on average by nearly £600m a year
Clinical gatekeeper
• Commissions the services required • Understands the needs of patients• Understands what is possible, clinically and financially• Drives higher quality
Primary care is the key
• Consistent regulation and pricing• Providers compete on quality, outcomes and patient experiences• Greater competition where this is in the patients’ interest
Creates a more responsive provider side
• A dedicated public health system
Protects long term investment
An NHS that puts patients and the public first…
• Offering choice to patients• Backed by an “information
revolution” to boost transparency
• Strong public/consumer voice through HealthWatch
…which focuses on improving healthcare outcomes…
• Outcomes frameworks • Backed by clinically-
evidenced NICE quality standards
• Incentives for quality
…with autonomy for professionals, and accountability to patients…
• Clinically-led commissioning• Local authority involvement• All public sector providers to
become autonomous; a level playing field with private/voluntary sector
• Separation of commissioner & provider
underpinned by reduced bureaucracy and improved efficiency
The NHS aims to achieve healthcare outcomes that are amongst the best in the world
The NHS Outcomes Framework
• The performance of the NHS is being held to account through the NHS Outcomes Framework. It is split into five domains:
The NHS : its defining characteristics
• The world’s largest publically funded healthcare service providing healthcare for all citizens
• Highly developed primary care • Expert hospital care
Universal
• Treatment provided by a multidisciplinary team• Enables continuity and co-ordination of care• Controls access to specialist care in hospitals Integrated
• The right service, workforce and facilities delivered through:• Sophisticated data collection and analysis• Planning and programme implementation• Regulation systems
Organised
The NHS : key building blocks
Infrastructure and facilities• World renowned companies partner
with the NHS to create outstanding facilities:
• design• build• operating
Training• UK training produces top class:
• clinicians• Nurses and midwives• Allied health professionals• Leaders and managers
Compatible information systems• Support the clinician and patient• Gather essential management and
population data
Technology• Cutting edge medical and bioscience
technology for:• clinical care• diagnostics• telemedicine• pharmaceuticals
The NHS in numbersThe UK Population 62.6m GDP $2.6tr
Spend on healthcare
Per capita (total) $3,480 % of GDP 9.6%
Per capita (government) $2,919 Private healthcare (as a % of total) 16.1%
Management cost 3% International rank 15th of 23
Medical staff
Doctors per 10,000 27.43 Total doctors in England c125,000
Number of GPs c42,000 Patients per GP 1480
Total nurses in England c330,000
Facilities
GP surgeries and health centres 8,400
Acute hospital trusts in England (2010) 168
Hospital beds in England (2009) 159,000
Regulators and Watchdogs Commissioners
NHS Structure in England
Government represented by Secretary of State for Health
Department of Health
Public Health EnglandNHS England Monitor (economic regulator)
Care Quality Commission (quality regulator)
Healthwatch England
Local Authorities
Clinical Commissioning Groups
Primary Care Services
NHS Foundation Trusts, Private and Voluntary Service Providers
Hospitals Community Services
Mental Health
NHS England regional and local offices
Tertiary Care and Specialist Services
Public Health Departments
Local Healthwatch
Funding
Regulation
Members of local Health & Wellbeing
Boards
Health Overview and Scrutiny Committees
All the population can register with a primary care centre (General Practice).They have doctors (GPs) and nurses with general clinical knowledge and skills. GPs can refer people to other services where necessary.
Tertiary specialist services
HospitalsCommunity-based care
Mental health
Primary care
The NHS: types of care services and access to them
Hospitals have doctors that are experts in particular areas of the body & conditions. They normally see people referred by Primary Care by appointment. People who need emergency care can be seen without an appointment. There are separate centres that care specifically for people with mental health problems.If people are able to be cared for in their own homes community based nursing and therapy services can support them.
Rare, expensive conditions are cared for in a few centres that take referrals from regions or the whole country. They usually have strong links with academic research institutions.
LocalPopulation
Primary Care
Focus on primary care
• First-contact care for new health problems
• Comprehensive care for the majority (90%) of health problems
• Patient-focussed care for people with long term conditions
• Care coordination and access to secondary care
What is a health centre for?
Outpatient clinic/Minor treatments
Diagnostics Clinical education
Primary care
Health and Wellbeing
The primary care pathway• Patient education
• Nutrition • Maternal and child health• Life style• Sanitation
• Prevention
• Immunisation• Surveillance• Environment• Nutrition• Communicable disease
• First response• Minor injury treatment• Diagnosis of illness• Prescribing medicines
• Care Coordination• Monitoring• Rehabilitation• Education• Crisis management
• Referral to• Community health services• Care services• Palliative care
• Referral to • Confirmation of diagnosis• Acute care• Specialist treatment
Return to Primary Care
The primary care team
Family Doctor
Therapist
Social workerAdministrator
Nurse
Therapist
Pharmacist
DentistMidwife
Psychologist
Primary Care: A Critical Review Of The Evidence On Quality And Costs Of Health Care Health Affairs, May 2010
Does primary care work?
• Provide effective treatment, rehabilitation and care outside hospital• Improve good access to and continuity of care• Improve patient satisfaction with their care• Become the gateway to hospital care• Provide cost effective care• Promote healthier lifestyles• Improve the training of family medicine doctors and nurses• Support monitoring and accreditation of the quality of the service
Effective primary care can….
Private healthcare in the UK
Private healthcare in the UK
• All citizens are entitled to NHS• Private healthcare is supplementary to
NHS• Small international market
• mainly in London• Private providers almost all secondary
care• A few private GPs in London
9%of the population buy private medical insurance
3%of the population self pay (including cosmetic procedures)
Public funding and provision dominates elective care in England
NHS FundingNHS Provision
“The NHS”
NHS FundingIndependent Provision
“Independent hospitals”
Private FundingNHS Provision
“Private Patient Units”
Private FundingIndependent Provision
“Private Hospitals”
NHS Provided
Private
Independent
PPUs
88.5%
6.7%
3.9%
0.8%
Elective Admissions 2012-13
Sources: HSCIC (HES) 2012-13; PHIN
200 independent hospitals conduct around 1 million patient episodes each year• Privately funded: 650,000
• NHS-funded: 350,000+
NHS FundingNHS Provision
“The NHS”
NHS FundingIndependent Provision
“The Independent Sector”NHS “patient choice” at ISTCs
and private hospitals
Private FundingNHS Provision
“NHS Private Patient Units”
Private FundingIndependent Provision
“Private Hospitals”
Private patients come from across the UK
© PHIN 2013. HES data re-used with permission of HSCIC. All rights reserved.
Warning: example data may not be complete and should not be relied upon.
Patients treated in independent hospitals
© PHIN 2013. HES data re-used with permission of HSCIC. All rights reserved.
Warning: example data may not be complete and should not be relied upon.
Why buy private care?
Immediate accessReduced waiting
time for treatment
Consultation/treatment always with a
specialist
Generally better facilities
Customer focus
Private insurance market
Per-sonal cus-
tomers 30%Large
corpo-rates 35%
Small/ medium enter-prises 35%
Customers Providers
40%
25%
35%All other providers
AXA-PPP
BUPA
Private providers
200Private hospitals and clinics
100Beds per hospital on average
Private Hospitals• Conduct routine elective surgery• Regulated by the Care Quality
Commission• as are NHS hospitals
Small Providers• Out-patient cosmetic and laser
treatments• Largely unregulated
Private specialists
• Most work mainly in NHS with one or two sessions a week in the private sector
• Some full-time private specialists in London
• Specialists are independent practitioners
• may work in a number of hospitals
• are not employed by private hospitals
Public Private Partnerships
Public Private Partnerships - PPP
Public and private sectors working in partnership and sharing risk
SimpleOutsourcing a
serviceShort /medium term
contract
ComplexMajor hospital development
Design + buildFinancing
Long term operation
Public Private Partnerships
Aims:
• clearly specified, realistic and shared goals• clearly delineated and agreed roles and responsibilities • distinct benefits for all parties • transparency • active maintenance of the partnership • equality of participation • meeting agreed obligations
Partnership: ‘a relationship based on agreements reflecting mutual responsibilities
to further shared interests’
A new children’s eye centre for Moorfields Hospital
Types of PPP in UK• A particular method of financing capital investment with requires that the private
sector design, build, finance and operate specific facilities• Long term contracts of 25-30 years• Payments only made if the service is delivered as per the agreement• Transfers substantial risk to the private sector
Private finance initiative
• Local Investment Finance Trusts (LIFT)• Department of Health/commercial company
• The Information Centre and Dr Foster IntelligenceJoint ventures
• Consumables, pharmaceuticals, management consultancy, laundry, cleaning etc• Treatment and care
• independent sector treatment centres
Contracts with suppliers
35
Redevelopment of the Royal Marsden Sutton Campus
PPP for Healthcare in the UK
20+years of experience
130healthcare PPP projects
£12 billioncapital value
1991 The UK Government introduces PFI
1996First contract signed to design, build, finance and operate a 1,000 bed hospital, in Norwich
2001 The Norwich hospital completed on budget and 5 months ahead of schedule
2006The largest single PPP hospital contract in the UK signed for the £1.1b redevelopment of the Royal London and St Barts
2012More than 130 healthcare PPPs completed, underway or approved since 2001
2016 Scheduled completion of the Royal London and St Barts PPP
Private Finance Initiative:Capital raised and projected repayments
12
79
Private Finance Initiative:Private sector participants
• Private sector partners can often be a consortium
• Leading participants include:
• Building contractors
• Service companies
• Insurance companies
• Banks, equity investors, pension funds
Public Sector Partner
Commission new facilities
Pay for facilities and facility management over term of contract
Commission separately soft FM – hotel services
Facility transfers to public sector partner at end of term
Provide clinical services, may retain equipment and IM&T
Private Sector Partner
Design facilities – architects, mechanical and electrical engineers
Build facilities – construction company
Finance facilities – equity and debt including a government stake in equity
Manage facilities – hard and soft FM
May provide some clinical services, may provide managed equipment services and IM&T
PPP structure in UK
Benefit of PPPs
Finance and risk• Transfers construction, maintenance and operation risk to
private sector in return for a guaranteed annual payment• Converts major capital expenditure into a rental stream which
may make it more “affordable” for a public authority as a payment from annual revenues.
• Projects can be re-financed after the construction phase, which is perceived to be the period of greatest risk, to obtain cheaper on-going finance rates and lower rental repayments
Benefit of PPPsDesign and construction• Fixed design brief which prevents cost escalation due to changes in
specification mid-construction• Delivery on time and on budget. The public sector pays nothing until
it has occupation and the private sector cannot come back for additional cash having agreed a fixed price and delivery date.
• Private sector can bring design innovation that facilitates optimal delivery of services combined with buildings that remain energy and maintenance efficient over their whole life
• Buildings are designed to the latest space standards• Modern designs work better for patients and staff
Benefit of PPPsWhole life maintenance• Contractor must maintain the buildings in an ‘as new’
condition throughout the contract period and can be penalised if they fail to do so.
• Contract allows for change mechanisms after construction completion.
• Whole life maintenance encourages low-carbon and energy efficient design
• Building consistently maintained to a high standard makes a better environment for patients and staff
Potential pitfalls of PPP
• Process is rigid and inflexible and design brief quickly becomes locked in and is expensive to change
• Contract variations are expensive because the IRR of the deal needs to be maintained
• Insurance and risk are priced into to deal and may prove excessive over time
• Public sector is poor at managing the operational phase of the contract and does not always secure value for money
• The deal locks the private sector into a fixed price, but it also locks the public sector in and reduces the public sector’s flexibility to downsize costs
Private Finance Initiative
Public Private Partnerships
Advantages• Access to capital and expertise• Transfer of risk• Quicker delivery of projects• Performance efficiencies from private sector management
Disadvantages• Lengthy procurement process• Lifetime costs• Loss of direct control• Need strong, informed client• Culture tensions
How can the Healthcare UK help?
• Introductions to NHS services and private sector companies experienced in PPP
• Creating consortia to meet specific needs
• Local UKTI contact and diplomatic support
• Arrange missions and visits to and from Brazil
• Provide expert advisers and speakers
A public system …with many partners
The vital partner in global health