Desperate for Funds : Crisis Grips Health Care in Britain

Britain’s National Health Service, founded 40 years ago on the promise, in the words of one parliamentary supporter, to provide free to every citizen “whatever medical treatment he requires, in whatever form he requires,” is undergoing an unprecedented crisis.

The problems in the system, long regarded as a world model of successful socialized medicine, came to be symbolized this winter by the ordeal of Matthew Collier, a 4-year-old from Birmingham born with a hole in his heart, whose encounters with the National Health Service (NHS) were chronicled on the front pages of the British press.

Three times Matthew was scheduled for cardiac surgery at Birmingham Children’s Hospital and three times he was turned away at the last minute because of a shortage of acute-care nurses. Matthew’s parents unsuccessfully sought a court order forcing the surgery, then threatened to bring an emergency action before the European Court of Human Rights.

Death of a 4-Year-Old

Finally, on Jan. 13, the operation was performed. One month later, on Feb. 14, Matthew died. He had never regained consciousness after the 10-hour surgery.

Doctors at Birmingham Children’s Hospital say the delays in surgery did not contribute to Matthew’s death. But as of the last week of February, 107 children still were awaiting heart surgery at the hospital.

“It’s impossible to run a proper department this way,” declared Dr. Babulal Sethia, a cardiac surgeon at Birmingham hospital. “We are facing a social injustice that cannot be allowed to continue.”

Throughout Britain, there are 700,000 people on waiting lists for elective surgery.

The British Medical Assn., in an unusual outburst, has described the NHS as in “terminal decline.” It cited exhausted and demoralized doctors and nurses, endangered patients and “filthy” hospitals.

Nurses Quitting

Budget shortfalls forced hospitals to close 3,500 acute-care hospital beds last year. The government also failed to fund in full promised pay raises for nurses. Unions representing nurses and health service officials agree that nurses are quitting at about the same rate as nursing schools are turning out graduates--about 30,000 a year. Many of those who quit are migrating to Australia and California, they say.

A survey by the Assn. of Community Health Councils of England and Wales, a consumer group, concluded in January that “unless there is action now, some parts of the NHS already on the brink of collapse will simply fall apart during 1988.”

In January, nurses struck a handful of hospitals in the industrial Midlands and a month later conducted a one-day nationwide strike, the first in NHS history.

Critics of Prime Minister Margaret Thatcher accuse her Conservative government of triggering the crisis by starving the system of funds.

Thatcher Denies Cutback

Thatcher denies this and points to the steady increase in funding under her government. But the public outcry has forced her to address the issue.

On Jan. 25, Thatcher announced a new, full-scale review with special emphasis on hospital services. Ministry of Health officials said the study will be a “wide-ranging, fundamental review” that will probably take several months.

Meanwhile, separate reviews of are under way by the Institute of Health Services Management, a professional educational organization, and the King’s Fund, a private charity and think tank. Those two reports are due by summer.

“When we are ready, we will come out with our own proposals,” Thatcher said. “If they are what people want, we will translate them into legislation.”

Fundamentally, the question is how much money the nation wants to spend on health care. Thatcher makes the point that demand is limitless. Members of Parliament, depending on their political leaning, see two broad choices: fund the NHS with enough money to keep it viable or find new ways to ease the tax burden of the health service by expanding private investment in medical facilities.

Increase in Private Care

Whatever changes the Thatcher government eventually proposes, and most people here bet they will include an expanded reliance on private health care, they are sure to stir more controversy. The NHS is an immensely popular institution and the opposition Labor Party is poised to leap to its defense.

Founded in a post-World War II era of renewal and optimism by Clement R. Attlee’s Labor government, the NHS is a tax-supported system of full medical care for 56.6 million Britons. It also is Western Europe’s largest employer, with more than 800,000 workers.

An alternative system of private health care has developed alongside the NHS and has grown dramatically since Thatcher took office in 1979. Private care, funded largely through insurance companies, is used most often to avoid the long waiting periods for NHS elective care.

Britain spends only 6% of its gross national product on health--far less than many other industrialized nations. Sweden, for example, spends 9.6%, West Germany 8.1% and the United States nearly 12%. Government critics say these figures are evidence that the NHS is, indeed, underfunded.

In a recent speech, Neil Kinnock, the Labor Party leader, estimated that in order to fund nurses’ pay awards, stay abreast of new medical developments and tackle waiting lists, $2.2 billion would have to be added to the 1988-89 health service budget. The Thatcher government has set the budget at $35.9 billion, an increase of about $1.4 billion over the previous year.

Rising Health Budgets

Budgets continue to climb, planners say, chiefly because of the technological advances that result in constant upgrading of instruments and procedures and the growing aged population, which uses significantly more services than younger people. According to Britain’s Department of Health and Social Security, persons over 65 accounted for about 43% of expenditures in 1985, compared to 36% in 1974. Such persons represent only 15.2% of the population.

Although the main focus of the recent publicity has been on hospital care, which accounts for 60% of the health service budget, out-patient services--for the mentally ill, for example--also have been hit hard. Out-patient practitioners complain bitterly that their budgets have been cut in order to subsidize more glamorous high-tech surgical procedures.

There are indications this trend is being challenged. At Adenbrook’s Hospital in Cambridge, one of Britain’s three regional liver transplant centers, officials said they may have to suspend the service in order to use the funds to meet more mundane needs.

“The hospital board may well suspend the regional unit. Each transplant takes away 20,000 pounds ($35,270) from the budget that could be used for the local population,” said Brian Lanman, the hospital’s treasurer.

Although Thatcher has said many times that she does not wish to dismantle the NHS, her support for more private health care is clear.

Tax Breaks Considered

One health care reform under consideration, according to Conservative Party officials, is tax advantages for those who buy private health insurance. Another is development of “American style” competition between health service hospitals and the private hospitals and the contracting for NHS care service with private hospitals that would do the work less expensively. Both these possibilities could have the effect of lightening the government’s tax load.

“The government is keen to see people who can afford it take out their own health insurance. It sees any extra source of money as a good thing,” a Health Ministry official said.

These proposals, along with the Thatcher government’s long-standing commitment to sell nationalized industries such as British Airways and British Petroleum, raise fears among supporters of the health service.

“The present scene is more volatile than at any time I can remember,” said Robert J. Maxwell, secretary of the King’s Fund. “The danger now is that the government will seek an easy, quick-fix solution. The most obvious one would be to go hell-for-leather the private way, such as changing funding in ways that would boost the attractiveness of private insurance.”

Between 1978 and 1987, the number of people with private health insurance, including dependents, grew from 2.3 million to 5.5 million, about 10% of the total population. These are mainly executives and workers in large companies, such as IBM Corp., Xerox Corp. and The Rank Organization Plc., plus one major union, the Electrical, Electronic, Telecommunication & Plumbing Union.

According to the British United Provident Assn., the nation’s largest private insurer, 15% of all non-emergency surgery, 20% of all heart operations and 25% of all hip operations are paid for privately.

Quality Not Criticized

“We’re willing to cooperate with the government if it wants to privatize,” said Philip Codd, public relations chief for the insurance company. “We’re not critical of the quality of NHS care--only its availability.”

The growth of private insurance was accompanied by a building boom of private hospitals, most of them owned by American for-profit corporations. However, private hospital beds still total only 10,000, compared to the NHS’s 330,000.

Critics of private health insurance believe that allowing it to expand in Britain could undermine the commitment to universal and equal provision of health care regardless of income, moving it instead closer to the American model.

“NHS is far better for the poor than the U.S. system,” said Walter Holland, professor of social medicine at St. Thomas’s Hospital Medical School in London. “We, unlike the United States, don’t have 30 million people who have neither government nor private insurance.”

Gordon Best, an American who is director of the King’s Fund College, where health managers receive training, predicts a two-tier health system.

‘Two Tiers of Privilege’

“The private system will end up doing all the profitable, sexy surgery and NHS will be left to take care of emergencies and the elderly,” Best said. “There will be two tiers of privilege, morality and confidence.”

But a government health official denied that the Thatcher government intends a radical change.

“I don’t see any clear policy to do so. They are waiting to see what happens,” the official said.

Britons, who contribute about $2,950 per family a year toward the health service--compared to $1,721 per person in the United States in 1985--have a strong allegiance to their health system. For Britons, 97% of the contribution is in the form of taxes and 3% in out-of-pocket expense. For Americans, 51% of the cost of health is privately paid and 41% publicly.

Numerous polls have shown that the British public considers the health service as a valuable national asset that it wishes to keep. A January poll by the London Sunday Times/Market & Opinion Research International group revealed that worries about the health service now top all other concerns among Britons, including unemployment.

Support of Majority

The vast majority of the 70,000 general practitioners and specialists who staff the National Health feel the same way.

“Whatever the criticisms of NHS,” said Paddy Ross, chairman of the British Medical Assn.’s specialists committee, “we believe very much in its principles.”

Nevertheless, there are indications that doctors’ allegiance could crumble if the government continues to provide what they say is insufficient funding for them to deliver the needed care.

“I don’t care where I operate--here or in a private system. I like the NHS, but my responsibility is to my patients,” said Sethia, the Birmingham Children’s Hospital surgeon. Sethia said his allegiance to the health service could erode if inadequate funding interferes with his ability to give the level of care that he was trained to provide.

“The fact is, we were hired to do a job, but if the government doesn’t get its act together, we are wasting our time,” he said. “I give myself five years to see if there are any changes. If there aren’t, I may have to rethink what I am doing.”

HEALTH CARE FACTORS These are some key factors that affect the cost of health care in the United States, the United Kingdom and Sweden.

USA UK SWEDEN Population in millions 242.2 56.6 8.4 Percent of population over 65* 11.8 15.1 17.1 Percent GNP spent on health 12% 6.1 9.5 Life expectancy at birth** Males 71.1 71.6 73.8 Females 78.3 77.6 79.9 Infant death rate per 1,000* 10.6 9.2 6.4 Doctor ratio to population 1 per 500 1 per 690 1 per 450 Hospital beds per 1,000 pop. 5.3 5.9 16

* 1985 figures ** 1984 figures