The challenge that the NHS faces today is variously described as: too much demand, too many patients, not enough resources.

This blog examines these issues identified by the systems already in place in the NHS and suggests how we can act on the performance management and BI information as part of addressing this classic dilemma: demand is clearly greater than supply.

The Imbalance

If you provide a valuable service or product, and health is certainly that, and you provide it ‘free’ to the customer how will demand and supply achieve balance? Your users want your service, as it is valuable, what caps the demand? What provides and what limits the supply?

Let us consider the situation when the product is not free. Consider for the time being only those customers that ‘can afford’ to pay for your product. Is the demand unlimited?

Customers will consider their next £1 of expenditure and decide whether to spend it on your product, or on something else. They have a limited availability of money and will allocate their spend according to maximising their overall quality of life, including food, heating, shelter, holidays, recreation and so on.

So where there is a charge, there is a limit on demand created by the individual’s choice over their allocation of limited money. The individual chooses which balance of health versus other things that they desire most, which varies over time according to their personal (and family) circumstances at the time.

If we remove the constraint of paying for the valuable product, the demand becomes unconstrained. Faced with the choice of whether we want a valuable product for free or not, the vast majority of customers will choose to have more of it.

The only demand constraint would be that our customers are satiated with the product. That they find a marginal element more of it less valuable to them than using up their time to attending to their health.

So the demand constraint is all of the users having as good health as they want, or at least can possibly achieve. An increasing user base (the UK population) and increasing range of treatments, creates a massively increased demand.

What about supply constraint? Is the supply constrained? Who and will allocate a limited amount of the product, and on what basis?

Let’s consider the assumption that the supply is constrained by the cost. The NHS budget is the constraint. Users can only have the amount of health product that can be supplied within the budget. Surely it is that simple.

But, from the data we see shared in inPhase performance management systems, we also know that in practise the budget can be over-spent. With local spending power, distributed purchasing and spending, the national budget limitation can be evaded to a greater or lesser extent. Sections of the NHS (Trusts) can borrow to over-spend, they can enter commercial partnerships that commit future income channels to the commercial partners and so on.

Practitioners also have a duty of care which puts patient care and safety above consideration of the budget. This creates a conflict over treating every individual patient in that patient’s best interests, and constraining health cost over all in order to meet all users demands equally well.

What the business intelligence data shows us is that in the winter months in particular the resources available (however much is available) will inherently be stretched beyond their capacity, as demand is unconstrained. The cash will be over-spent, the resources will be over-utilised, the staff will be over-worked. Inherently.

Let’s also consider the suppliers to the NHS. Staff, especially skilled staff, and drug suppliers and equipment suppliers, buildings companies and so forth, have high costs, which they can continue to increase, provided they can be seen to be either: helping limited resources better meet demand or improving health outcomes.

In summary; open ended increasing demand, increasing expenditure and costs, and no constraints on either other than bankruptcy of the NHS, which means the government, which means every one of us.

We all recognise from the information available that steps need to be put in place to counter each of the unconstrained factors and produce an inherently stable health economy.

Demand

The NHS is a ‘National’ health service, not an ‘International’ health service. It needs to stop providing free health products to non-nationals. Immediately. If you are not a UK tax payer with a NI number (or dependant), you don’t get free healthcare from the NHS. This should be through non-delivery, not delivery and then issuing invoices that don’t get paid.

A&E demand. If you are not involved in an accident or an emergency that can only be dealt with by A&E- you should not be accepted into A&E. At present, provided you are willing to wait, you can always get seen in A&E. Can all (of us) users be made more aware of the demands on A&E, even perhaps in publically available on the web real-time business intelligence dashboard, and be better directed to Minor Injuries Units, to GP, to Pharmacies, and other alternatives that are less under-pressure at the time.

Supply

Health is not free at all. Health costs all of us (UK Tax payers) a very great deal of our income through the tax and public expenditure system.

Allocation and extent of resources should be better controlled. This means more use of better BI and Performance Management systems usage for visibility of; resource usage, improvement projects performance, costs, waste, efficient quality control, unnecessary actions and time consuming activities.

Real-time performance management systems data can help manage Trusts resources better, spot projects that are going over budget and projecting delivery of diminishing benefits earlier and stop the haemorrhaging of cash earlier.

Bed-blocking. Follow the cause and effect link back through the data and address each step. Care homes beds are in shorter supply than the need, to a greater or lesser extent depending on the local situation in different geographies. Increase public and private care homes (perhaps instead of building a 15minute faster train line from London to Birmingham) and in the mean-while create transition facilities.

These facilities have lower costs per bed day than hospital wards, and free up hospital room facilities faster, prior to longer term accommodation being available. Free up even these additional Care Homes beds by investing in non-residential care centres that enable patients to continue to live at home.

Consider private healthcare. Many skilled resources are sucked away from the NHS full or part-time by the private healthcare companies, and in addition this indirectly increases the salary costs of keeping skilled staff within the NHS. The resulting shortage of full-time NHS staff means that there is a massive requirement to use Agency staff.

Agency staff costs are killing most NHS Trust budgets. Charge the private companies for the right to run private healthcare in this country, proportional to the amount of skilled resource employed. Agree a fair salary scale and where a private company pays more than this for any individual, require the company to also pay the same amount as the excess in to the NHS staff budget.

Let’s consider drug costs. Our Business Intelligence data shows that even when the NHS strives to make more use of cheaper generic drugs, this is difficult to achieve across such a vast prescribing community. NICE is continuously under pressure to approve new drugs and treatments. We hamper our NHS by providing levels of legal anti-competition protections to drug companies that are unseen in other industries. A new drug cannot be competed with by a competitor for 15-20 years.

Why not halve this duration?

There is so much profit in the drug business that increased competition will not stop drug companies creating new drugs. Can we increase competition by reducing the exclusivity duration, rather than restrain competition with such long patents. Is it in our interests to get ever more exotic and expensive treatments, or also to lower the cost of current treatment capabilities?

Cost

Let’s think the unthinkable and consider Charges at the point of use:

Should we charge for the NHS at point of use? We already do. Prescriptions have charges. Parking in the hospital grounds is not free. Dental health is now only free to a very limited portion of our population. As expressed earlier, if you are not a national, with a NI number – we charge you for your care.

But what about other point of use charges? GPs have a massive number of 10 minute appointments to get through, can we reduce these in various ways? If you are visiting a GP or a consultant, let’s have a contributory charge, like prescription charges, not much, but a very large number of small amounts will help with funding and may even help create some user demand management.

Let’s invest in fast tracking the development of automated testing for viral versus bacterial infections before you meet your GP and reduce the issuing of anti-biotics, reduce costs and help preserve the usefulness of anti-biotics by reducing the rise of the antibiotic resistant super-bug.

One thing we should not do is complain that the NHS budget is too small and do nothing to balance the supply and demand. We have a national health service that is one of the best in the world, let’s celebrate it and keep it in great shape, and let’s respect all our NHS and supporting workers by managing it better. As users, let’s use it when we need it and in the most considerate way, and not abuse it, and lose it.

With the latest advances in real time BI we can all have the performance information at our fingertips; to help managers manage and users use this great institution better.

Robert Hobbs

Chief Executive Officer

InPhase’s Chief Executive and Founder, Robert has been the visionary leading InPhase to be one of the UK's leading providers of management, governance and assurance solutions, and helping organisations align their actions and goals more easily and efficiently with InPhase's suite of integrated apps.