The latest figures on the financial statement of the NHS (National Health Service) in England are alarming. It is the worst financial performance in the history of the health service. According to projections, the figure will reach £2.2 billion for 2015-2016, compared with £800 million last year.

Since 2013-2014, the NHS deficit – system financed mainly by taxes – keeps increasing. It will probably rise from £0.1 billion in 2014 to £2.2 billion next year. These figures, described as “awful” by Jim Mackey, chief executive of the NHS Improvement, will they sign the end of the British health system as we know it since 1948? Several voices have protested and called for a change. Richard Murray, policy director of the think tank The King’s Fund, mentions an unprecedented financial meltdown which jeopardizes, for the vast majority of NHS providers, the quality of health care. Therefore, it urges policymakers to think about a new viable option in the context of an evolving supply and demand for health care.

The causes. The main reason is what Norman Fowler, former Secretary of State for Social Services, has called “demographic timebomb“. According to him, unless deep reforms, the health service was doomed to failure because of the weight of demand of the population increasingly aging. Moreover, the doctors and nurses shortages significantly slow the absorption of demand. Despite the £116.4 billion paid each year by taxpayers for England alone, the NHS trusts are unable to cope with demand. In addition, in the next 20 years, the situation tends to get worse. Indeed, the number of those over 85 will more than double, to 3.5 million.

Proposals. On 4 July 2011, the Dilnot commission, set up by the Government and headed by the British economist Sir Andrew Dilnot, published a report on methods of funding care for elderly. It recommended an insurance-based system to deal with very old people utterly incapable of looking after themselves. But these recommendations have been ignored.

Simon Stevens, Chief Executive of the NHS in England, preferred to ask for the £8 billion funding the health service – promised by 2020 strategy – to be “front-loaded”. Moreover, NHS hospitals trusts have been ordered to make swingeing cuts to spending on agency doctors and nurses. The regulatory authorities of the NHS believe that this “over-reliance” on agency nurses and doctors to address the lack of staff only fuels the debt. According to latest figures, the NHS spent more than £3 billion on them in a year. In June, the Health Secretary announced a clampdown on use of agency doctors and nurses.

IPSE will shortly publish a presentation of the “complementary health care insurance” in the UK.