OECD: Better run NHS could save billions

Julian Harris
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NATIONAL Health Service (NHS) inefficiency is the third worst among peer countries, according to a new study released yesterday.

Only Greece and Ireland’s healthcare sectors had more scope for efficiency savings, according to the Organisation for Economic Co-operation and Development (OECD).

The UK came out well below the OECD average.

The study gathered data from 29 countries, evaluating the return on investment into healthcare provision.

Health services are facing tightened budgets as governments deal with the global economic slowdown, “reinforcing the need to improve healthcare efficiency,” said OECD secretary-general Angel Gurria.

The report claims costs can be reduced in many OECD countries by almost two per cent of GDP, while the NHS could achieve savings in excess of three per cent of GDP.

“Healthcare averages 15 per cent of government spending across the OECD, and costs are still rising,” said Gurria.

Ageing populations are placing pressure on budgets, while expensive technological advances are often too expensive for government departments.

In 1999 the government set up the National Institute for Health and Clinical Excellence (NICE) to ration treatments.

The OECD’s conclusions were echoed by Nick Seddon of the think tank Reform. “Competitive pressure is a very good way to improve performance,” he said. “And inequalities are actually lower in market-based systems.”

Last week the NHS released a map of the UK revealing stark variations in quality, he said.

The NHS is one of two government departments to have its budget “ring-fenced” by the Coalition, a move criticised last week by the Treasury Select Committee.

The Department of Health’s budget is expected to increase by 1.3 per cent over the next four years.

Out of the OECD countries surveyed, patients in Australia, Japan, Korea, Switzerland and Iceland get the best health outcomes for money spent.