NHS Contribute Extra: ending the postcode lottery and helping to close the funding gap.

Edmund Stubbs, 20 February 2015

Today, Civitas has released a new report proposing a voluntary contribution fee for the NHS totaling 0.5 per cent of an individual’s income. The contribution would enable users to transfer their treatment budget to any NHS provider that they wish to use. This would essentially end the NHS’s postcode lottery (where patients receive different standards of treatment in different areas of the country) and prevent the bottlenecking of users in areas were certain local services are in high demand.

Patients would also have the option available of transferring the amount that the NHS would pay for their treatment to any non-NHS provider, topping up the likely extra costs of private providers out of their own pockets. The costs of administering cash transfers around, and outside of, the NHS would be covered by the contribution fee revenue which could easily generate as much as £3.5 billion. Most of the remaining revenue would be invested in NHS hospitals from which many users are seen to be leaving (an indication of poorer than average care). It is hoped that with these additional funds, and a temporarily reduced patient demand, underperforming services could rapidly improve and start attracting patients back.

The last major benefit of the scheme comes from its proposed extras, such as an annual ‘health MOT’ (where a patient has a basic clinical examination with annual health targets being agreed upon with their GP) and discounted gym membership. The extras are intended to increase the attractiveness of contributing, but also to aid a shift of emphasis towards preventative healthcare. It is intended that people will engage in their personal health and work with their caregivers to live a healthier life.

In response to today’s publication of the report, a statement from the Department of Health shows reluctance to engage with any of the report’s recommendations. They state that ‘the NHS will remain free at the point of use and patients can already choose where they have NHS treatment.’

The report does not challenge the ‘free at the point of use’ aspect of the NHS. It is an additional, regular monthly payment (which must be paid for at least four months before treatment can be sought). In response to the second part of the DoH’s statement, it is extremely difficult for a patient to transfer between NHS services. Providers are often uncertain over whether they will be paid correctly in these circumstances and there is a lack of administrative funds to make alternative referrals in the first place. Hence, management systems seek to limit these referrals, especially for specialist services.

In summary, the report presents a win-win situation, with contributors getting increased provider choice and non-contributors experiencing shortened queues from services, with demand being distributed more evenly over our entire system. The additional revenue generated, and the reduced demand on stretched local services, resulting from the implementation of NHS Contribute Extra, could help close the £30 billion projected funding gap that the NHS is likely to face by 2020. It would achieve this by adding money to the NHS while allowing services, previously running over capacity, to have both staff and time  available to focus on efficiency.

The full report is available here

Edmund Stubbs, Healthcare Researcher