Doing the public good – the NHS as a ‘public good’

For those who have never lived in a time or place without a national health service it is difficult to grasp the significance of what happened 70 years ago in the UK.  The creation of a national health service was revolutionary in its overall aim of providing free medical care to whomever would need it, throughout their lives.  This was the creation of a service that became a public ‘good’, in every sense of the term.  It takes money from every working member of society and uses it to provide for those who get sick and those who could otherwise not afford medical care, in order to maximise social welfare for all.  It was revolutionary because it put into practice one of the basic elements of what defines a group of people as a community or ‘society’ – the ability to look after its weakest members.

Statue of Aneurin Bevan, founder of the National Health Service, in Cardiff, Wales.

Like many public goods, however, it is virtually impossible (financially) to deliver a good or service that is open to all at the maximum level each person would desire, particularly when what is desired is ‘subtractable’.  A good or service that is subtractable means that one person’s use of the good/service prevents some other person from using that particular good/service at the same time and/or place.  For example, if I break a leg requiring an ambulance, an operation, the care and attention of doctors and nurses and a hospital bed, then someone else cannot also utilise all those benefits at the same time.  The National Health Service is therefore not a ‘pure’ public good, defined as accessible to all, and where one persons’ use of the good or service does not reduce the ability of other people to also benefit.  A lighthouse is a good example of a pure public good – once provided the benefits are available to all and the fact that I use it does not prevent anyone else from using it.

The question for society, and government, is therefore how to maximise social welfare through provision of a public good when resources are limited.  In that sense the National Health Service (NHS) is more like a commons resource, where it is difficult to limit access but the resource is subtractable, requiring a regulatory system to monitor its use and enforce rules to ensure the resource continues to be available into the future.  Some form of ‘rationing’ is one answer, which might occur through waiting times, limiting the level of care, or through decisions not to provide some aspects of health care (e.g. highly expensive medicines for rare conditions, or certain kinds of operation for non-life threatening conditions).  An alternative might be a stronger focus on prevention of disease; the ban on smoking was a move in this direction, and diet, including reductions in sugar consumption, is currently under focus as a means of reducing future demand on services.  No-one would pretend that making such decisions is easy, but if the aim of a public health service is to provide care for all then some rationing of a resource shared ‘in common’ has to be expected, in balance with the amount of financial resources we, as a society, are prepared to contribute.

This rather detached economic definition of a ‘public good’, however, does not even come close to communicating the full impact of provision of a public ‘good’ provided by an organisation like the NHS, even one that has to be rationed (because demand for health care is almost infinite).  One of the most significant benefits, and the one most difficult to measure and communicate, is the removal of worry and concern over what happens when you need health care.  The knowledge that if you or your loved ones have an accident, or fall ill, you will be taken care of without cost, is itself an invaluable benefit that removes worry, concern, anxiety, and improves mental health.  Unless you have lived without a national health service, it is difficult to understand the fear of getting ill, or having even the slightest accident requiring hospital attention.  In the USA, for example, where health care is privatised you buy insurance if you are well off, or you might be lucky enough to have a job that provides some level of medical care. However, millions live without any form of insurance meaning any type of medical cost is a constant concern, because when you walk out of the hospital door at the end of your stay you are handed an itemised bill, right down to every sticking plaster and glass of water consumed.  Even those with health insurance often live with an underlying level of anxiety since for many the insurance does not cover the full cost of major medical care.  A ‘major medical’ event can bankrupt a family overnight.  Such a system comes with social costs, creating inequalities and stifling creativity, mobility, and freedom within a society.  People don’t change jobs, or set up new businesses, or move across state lines, because they are afraid to lose health benefits; the anxiety becomes a drain on emotional energy, it dampens innovation, social reliance, and the capacity to take risks.

The NHS is not perfect, it is an organisation under great strain, in particular from those within government who would like to see more and more areas of the service opened up to private sector organisations, who can then profit from those unfortunate enough to get ill or require care.  But, anyone who has ever needed emergency health treatment will understand the social benefits that come with a world class nationalised health system.  Anyone who has ever experienced having a family member, or child, struck down by illness, will appreciate the relief that comes from having any consideration of cost removed from the equation, enabling you to focus on what is best for the patient.  When life-changing decisions have to be made, under crushing time, medical, and emotional pressures – the value of the benefits from knowing that the advice you are given is free of any concern over financial profit or loss – cannot be calculated.

You cannot itemise all the benefits from the National Health Service, and stick them on a piece of paper to compare against the costs, to see which one is bigger.  You cannot measure all the public ‘goods’ delivered by a ‘national’ health service in financial terms through a cost-benefit exercise.  This is not to say that delivery of public goods should not be efficient, it is using public money and needs to demonstrate efficient use of resources, but the benefits are always going to be harder to measure than the costs.  As a society we need to develop a stronger set of arguments in support of public ‘goods’ and shared commons like the NHS that benefit society in multiple ways, many of which go beyond the ability of accountants and economists to incorporate into simple financial calculations.  If we don’t do this, we are likely to see the ‘public’ goods delivered by the NHS slowly eroded through the encroachment of the private sector, our costs will increase, and benefits will be lost.

A ‘public’ good that puts people before profit, an organisation where the cost of the nurse squeezing your hand in reassurance is not calculated – because it is invaluable – is surely a better way to live.  Better than one where every decision is based on making a profit – and where the only thing in your hand at the end of your stay is a massive bill, with every detail itemised, right down to each glass of water provided – with service charges attached.