Health Care Demand Will Continue to Rise in U.K.

July 16, 2014

Britain's Office for Budget Responsibility released its yearly Fiscal Sustainability Report last week, predicting that health care spending in the U.K. will rise from 6.4 percent of GDP in 2018 to 8.5 percent in 2063. However, Jeremy Warner of the Telegraph explains that the report uses some very unrealistic assumptions to calculate those figures:

  • The report assumes that the National Health Service will see the same productivity gains as the economy as a whole (2.2 percent), despite the fact that health care productivity gains tend to be less than half of that figure.
  • Using a more realistic productivity rate, health care spending in the U.K. would reach 15 percent of GDP by 2063.
  • The report also assumes that health care demand will remain at current levels, despite the fact that citizens' expectations about what services the NHS should provide are growing.

Warner pinpoints why costs in Britain will only continue to rise: "Demand is a bottomless pit. If provision is seen to be effectively free at the point of delivery, it can never be sated." He anticipates that Britons will be forced to pay for some of their health care services in coming years as demand increases, contending that lawmakers must find a private solution to these funding problems.

Source: Jeremy Warner, "The NHS - Britain's national religion - doesn't have a prayer," Telegraph, July 11, 2014.

 

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