Way back in 2014 BUPA’s then managing director Dr Damien Marmion called on the private health care industry (insurers such as BUPA and providers, hospitals and doctors) to reduce their prices by 15%. He warned that without doing so the private healthcare industry would not only face stagnation, or “flatlining” as Dr Marmion termed it, but could also experience decline. Unless costs to those looking for insurance and services is reduced, the future market looks challenging for private providers. 

Dr Damien Marmion said: “We are asking the sector to come together to reduce costs by at least 15% to reach a point where affordability gets better. The whole sector has failed to provide the right outcome for customers. Private healthcare needs to be much more affordable”. 

The question the healthcare industry has since asked itself is: is this possible? 

Is it realistic and achievable? 
In order to reduce costs, and thus prices by the 15% Marmion recommended, the industry faces several barriers. These come from costs, population, business model and infrastructure. The rest of the private healthcare provision and insurance industry met the call with scepticism. The main question being whether doctors, consultants, clinics and hospitals would be able to make those necessary 15% cost savings without compromising patient care.  

What challenges would the industry face in doing so? 
The biggest challenge to lowering the cost of health care in both the public and private sectors is demographics. We are all living much longer. As subscribers pass the 50 mark, individual and corporate purchasers baulk at the steep increase in premiums. An aging population brings with it issues of longer retirement, nursing and end of life care – all of which can be treatment and staff heavy. The UK is also seeing a rise in long-term conditions such as obesity and diabetes which incur increased costs, and thus premiums across the customer’s lifetime. 

The next challenge is health care costs inflation. Since the NHS’s inception, the rise in healthcare costs has outpaced both GDP growth and general inflation every year. Rises in costs of drugs, equipment, treatments, procedures and wage inflation all need to be carefully examined by the industry. 

Private healthcare providers also face challenges in their infrastructure. Many private hospitals and clinics date back to the 1980’s and are, by today’s standards, outdated for 21st century care provision. In many private hospitals day surgery is being delivered in inpatient settings which are not very efficient. 

The final challenge to bringing down the cost of private healthcare premiums is the service delivery model itself. This boils down to the ongoing debate between private insurers and consultants/ doctors in the private sector over transparency in costs. It is also likely that to reduce costs to subscribers, consultants in the private sector will have to follow the example of their colleagues in the NHS and begin passing on more routine tasks to nurse practitioners who can deliver the same high-quality patient care but at a lower cost.   

What role could temporary staff play in this? 
Temporary staffing solutions provided by recruitment and staffing companies such as GRI, which connect private healthcare providers with highly trained and qualified nurse practitioners, can help to drive down the cost of private health care. The cost per hour of nurse practitioners is favourable when compared to that of general practitioners or consultants. 

Employing highly skilled temporary nursing staff in private healthcare practices and hospitals frees up valuable (and more costly) consultant time whilst maintaining standards of patient care at the point of delivery and even reducing delivery times for care. Nursing practitioners can also bring a wealth of experience from the state sector – which has already transitioned to this type of service delivery model.  

Employing a higher than previous ratio of temporary nursing staff increases a care provider’s flexibility and makes hospitals and clinics more responsive to patient demand whilst freeing up doctors time from more routine tasks and, most importantly can help to deliver cost reductions to subscribers. 

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