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With the UK’s long-term future in turmoil thanks to Brexit, warnings about rising costs are becoming routine and normalised; they don’t provoke the same response that they once did.

But increasing healthcare costs for our NHS should be of concern to everybody. The more that it costs the NHS to order the drugs and other supplies that it needs to function, the more money it needs.

healthcare costs

While most British citizens are happy to pay more in taxes for the NHS, and more money for the NHS was a key promise of the Leave campaign, the government seems reluctant to actually ask the public for more money. Theresa May pledged that the NHS would receive more than £20 billion by 2023-24, but new research analysis suggests that this won’t be nearly enough.

Rising costs

Rising healthcare costs in the UK are in line with the broader global trend, which has seen the cost of healthcare skyrocketing for numerous countries around the world. Switzerland stands out among comparable high-income countries in that it spends the most on out-of-pocket healthcare in comparison to average income.

The average Swiss citizen spends 8.5% of their income on healthcare each year. In Switzerland’s hybrid public/private healthcare system, private health insurance is compulsory. However, the government and Swiss employers cover more than a third – 35% – of the total healthcare costs for the nation.

A report from the OECD in 2018 projected that OECD member countries, of which the UK is one, could expect to see their healthcare costs increase by as much as 14% of GDP by 2060. Of course, the UK is currently in a unique position among OECD members and the long-term viability of the current health system is under question, so that number could vary. When it comes to healthcare, it is sensible to err on the side of caution.

Investing in good healthcare is expensive, and those costs ultimately need to be borne by individuals or the public at large. But, as reported by lenews.ch last year, while the Swiss healthcare system witnessed a jump of 3.8% of GDP over the 2015-2016 period (since which time Brexit has skewed data), the UK saw its own leap in costs from 3.6% to 9.9% of GDP – a 6.3% increase.

The US comparison

New research from Antibodies.com, an antibody supplier and medical research specialist, compares average annual salaries with healthcare and pharmaceutical spending. One of the more surprising, or at least counterintuitive results of this research was that US citizens pay 4.8% of their average annual earnings – $60,558 – on ‘voluntary’ out-of-pocket healthcare costs. This is despite the US being the only OECD nation in which government funding and compulsory health insurance is not the primary source of healthcare funding.

The average prescription costs more than $3,000 per year more in the US than it does in the UK. This difference is starkly illustrated with drugs like insulin – an important and life-saving medication for diabetics. While there have been repeated calls for the price of insulin to be regulated by an act of Congress, insulin remains significantly more expensive in the US than anywhere else in the world.

Diabetics in the US will have to pay $10,404 each year for medication that they need to live. Because of this, there have been a growing number of cases where diabetics have had to ration their insulin injections and have ended up suffering fatal drops in blood sugar as a result. In the UK, patients are required to pay a prescription charge for the medicines. This is a fixed-cost set by the government and patients who regularly pick up prescriptions can buy pre-payment certificates that will reduce their overall costs.

Similarly, drugs like Humira, which is used to treat a number of chronic conditions, including arthritis, Crohn’s disease, and ulcerative colitis, to name just a few. Leaving these issues untreated can severely impact a patient’s quality of life, or even prove ultimately fatal.

However, in the US’s dog-eat-dog system, there are few if any controls on the costs of life-saving treatments. The notable exception to this is dialysis, where the US government is bound by law to provide treatment at the expense of the federal government for patients suffering from end-stage renal disease – fatal kidney failure.

NHS funding

Despite the British public being united in wanting a functioning and properly funded NHS, the NHS is struggling to cope with the challenges of an ageing population, rising demand on its services, staff shortages, and an unwillingness to properly fund it centrally. Add in the potential impending reduction in EU citizens applying to work in the NHS with a potentially significant hit to its available finances, and an apparent appetite to sell it off to US businesses, the long-term health of the NHS is in serious doubt.

According to Antibodies’ research, the money pledged so far by the government is not going to be nearly enough. Antibodies are reporting a roughly £45 billion gap between the funding currently pledged and the funding needed to both maintain provisions and maintain services. To meet the proposed level of funding, British taxpayers would need to hand over an extra £400 of Income Tax, National Insurance contributions, and added VAT every year to improve the NHS. To maintain its current state would cost roughly half as much per person.

This research highlights the importance of ensuring that the NHS is properly funded. Not only do most people view access to healthcare as a basic human right, but we have seen from other countries that increased privatisation translates into increased costs for patients. While the public purse could undoubtedly afford to send more money to the NHS, British people seem willing to pay more in tax if it means their NHS will be properly funded. Unfortunately, it is up to increasingly ideological governments to properly balance national healthcare costs with the average wage.

Dr Stewart Newlove, managing director of Antibodies.com, summed the situation up best, saying that these rising healthcare costs need to be matched with a national living wage.

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