BBC On The Record - Broadcast: 25.06.00

Interview: LIAM FOX MP, Shadow Health Secretary.

Talks about how the Conservatives would encourage more people to take out private health insurance.



JOHN HUMPHRYS: So, Dr Fox, let's see if I have got this right. You would spend at least as much money on the NHS as the Labour Government is doing and is planning to do, but you don't think it's enough even so, so you would have to raise more money by getting more of us to pay more private health insurance. LIAM FOX MP: Well, first of all can I take the point about commitment to the NHS as an NHS trained doctor who spent all his working life before Parliament in the NHS I'm hardly the one who wants to dismantle it. The important thing is do we get the quality of health care in this country that we deserve. You mentioned in that film comparisons with other countries and what I think we need to be doing rather than talking about the input side and just how much we're spending is what we're doing and the biggest problem we have is that our outcomes in terms of heart disease, in terms of cancer are actually well below the levels predicted in Germany, or France or Holland and now I want them brought up. And the question we have to ask is how much do we have to spend and how do we have to spend the money, more importantly, to get ourselves those outcomes. Now we have said that we will match Labour's planned increases in expenditure as laid out in the Budget but that I also want to see expansion of the private sector at the same time. It's not a question of one or the other, we want to see both an expansion of the NHS and an expansion in private healthcare so that we can get the sorts of partnership in the United Kingdom that we've got up to a limited extent at the present time but which they have far more in other countries. HUMPHRYS: But you are a bit nervous about bringing in the policies that would produce that result aren't you, expanding private medicine, private insurance? FOX: I'm not nervous about it at all. It's a question of how you bring it in and the way that you get the best results. For example, it was mentioned in the film about private tax relief and the Labour Party are always accusing the Conservatives of wanting to bring in tax relief for the wealthy so that they can pay more easily for the private healthcare that they already have. Now that's a complete nonsense. The best way to get any increase in provision is to get a quality product that is more accessible to people because it's cheaper. Now I don't have private healthcare at the moment, one of the reasons is the same as many people out there, that I believe it's very expensive, I believe it's inflexible and for many people it has too many exemptions, for the elderly for example, they feel that they can be treated for anything except anything they've already had and that's a big disincentive. Now, what I want to see is an NHS which works in a way to treat priorities so that the sickest patients are treated first. Now there is a very good upside to that in the private sector because if you or I knew that we were going to get treatment for our heart disease or our cancer within a guaranteed time in the NHS why would we possibly want to insurance ourselves privately for that. We have indications from many of the private insurers that if the NHS guaranteed to do that work and they didn't have to provide any insurance privately for that, they could reduce their premiums by say thirty per cent. Now that is a far better way of getting an increase in the number of people who might be attracted to that than using the taxation system. HUMPHRYS: But the taxation system is clearly very important, at least you believe that to be the case. The sort of thing you want, this expansion of private insurance that you want is not going to happen unless and until you offer everyone tax incentives is it. FOX: I don't actually agree with that John. I think that the most important thing is to make sure that people have something they want to buy at a price that they can afford to pay for it and I don't think... HUMPHRYS: ..but that's crucial, the pay you can afford to pay for it and that's determined by whether you get tax relief on the premiums that you have to pay because it brings down the cost of the premium. FOX: Not necessarily as I've just said there are ways of bringing that cost down without using the taxation system. But you are talking there about personal medical insurance, that's one side of the equation, there's another group which is those covered by business schemes, through their employers. Now that's about three point seven million people at the moment in the United Kingdom. That's where I would like to see the big increase coming because all the evidence from other countries is that that is the best way to get (a) an increase in the total number of people covered to get an expansion of the private sector and to give it to people who couldn't otherwise or wouldn't otherwise choose to buy it themselves. HUMPHRYS: There would be tax relief then on company schemes as far as you are concerned. FOX: At the moment there are two major disincentives... HUMPHRYS: Each on insurance. FOX: National Insurance on employers, the government recently slapped a hundred million pounds worth of tax on employers, who, in their view, had the audacity to become involved in the healthcare of their employees and employees are taxed as a benefit in kind. Now in the long-term we would like those disincentives to disappear. How quickly you can get rid of them depends on the overall performance of the economy and how much you are spending on the NHS and as we have already said we plan a big increase in that and you have to balance that against the benefits you might get for abolishing disincentives in terms of the growth of the private sector and the sort of increase capacity you get in your economy for employees actually being healthier. HUMPHRYS: So let's be clear about this, you would or you would not get rid of tax payments, you would allow company schemes to qualify for tax relief. FOX: Yes in the long-term we would ..... HUMPHRYS: ..in the long-term - you don't know how long that would be? FOX: Well there are ways of doing it and it's..you wouldn't expect me to simply promise anything without strings. For example, I would ... HUMPHRYS: ..I don't know, I heard it done before... FOX: I would like to see any increase done in a way that encouraged particular schemes, for example, with good preventative medicine schemes to make sure that what's happening in the private sector is complimentary to the NHS and is not simply doing something different. HUMPHRYS: But there would be relief for company schemes. In other words somebody is on a company scheme they would not be taxed as though that would be benefit in kind - that is what you are saying - ultimately that's what would happen under.. FOX: ..ultimately that's where we would like to go. The pace of course is dependent on a great number of economic factors. HUMPHRYS: In that case, why not for all individuals, why should somebody who works for the sort of company that provides that kind of scheme, have that kind of benefit when other people - especially the elderly - don't. FOX: Well it's a matter of what the NHS can provide and how we can practically do it... HUMPHRYS: But that's not fair.. FOX: But it how we can practically do it John, we're living in a real world and not some sort of think tank virtual world... HUMPHRYS: Well You'll to penalise the elderly for instance and benefit those people who are in jobs? FOX: The best way to improve care for the elderly is to ...what the NHS actually does and perhaps we can talk about that. HUMPHRYS: But I mean let's just deal with that one for a moment, a very large number of elderly people watch this programme and they will be concerned about this because they would like to have private insurance schemes and many of them can't afford to and clearly if they are going to get some sort of incentive, then they'd be more tempted and they are looking at this scheme now where people in work get this benefit, they wouldn't get it. You've got to have a equitable system haven't you? FOX: The real question is how can more people afford to get it, now as I've already said when the Labour Party abolished the tax incentive for the elderly that resulted in a ten per cent reduction in the number of people with private medical insurance. Our evidence suggests that if we go ahead with our Patients' Guarantee model and the NHS is guaranteeing cancer treatment times and cardiac treatment times that the premiums will actually fall by about thirty per cent and that will result in an increased uptake of about twenty to forty per cent. So you are getting up to four times as many people being able to take it up as a result of that model. To be frank with you, if you are going to introduce tax incentives in the way that has been suggested, there is very much a dead weight to be borne there, in other words you'd actually be paying a lot of people who already have private health cover to keep the same cover going. That's very expensive and what I want to make sure is that we are able to treat more patients with a higher quality care and that means trying to look at the various options available to us to see where we can get the biggest increase in the size of the cake in total. HUMPHRYS: So you're very reluctant to offer carrots, except for the people in company schemes as we've established. What about the stick - in effect saying to people "Look, the NHS cannot do everything, yes, we'll deal with the urgent things that have to be dealt with. Obviously we always have and we always will, but it can't do everything, certainly not in the time that you need, therefore, there are some things that you will have to pay for yourself". FOX: Well, that has been proposed by the IOD and others that we move to what's called the core model NHS and I actually reject that and let me tell you why. Because it requires politicians to make decisions about clinical conditions which I don't think they are actually able to make. A very good example..... HUMPHRYS: I thought that was exactly what you were saying, that we had to make choices. You said that on many occasions. FOX: Exactly, we have to set priorities. Can I just finish this point. For example, one of the areas that's often talked about in a core service would be something like varicose veins. Now, dealing with varicose veins may not be regarded as a core function of the NHS. I mean in ninety per cent of cases that may well simply be a cosmetic procedure, but if you happen to be one of the elderly patients who gets leg ulcers and becomes bed-bound as a result, I would say that was part of what the NHS really ought to be doing. So it becomes very difficult once you look at conditions to exclude them. What I think we have to do is something different to actually... HUMPHRYS: Before you leave that point, the implication of that, what you've just said is that the NHS is just going to carry on doing everything. FOX: No, what it says is, that we don't exclude particular conditions, that we treat patients as being individuals. In all of this, you see all the commentators want to talk about patients as though they were averages, and good medicine is seeing patients as individuals not as averages. I didn't see average patients, I saw individuals with their own past medical history, their own particular condition, their own family circumstances and we have to have a system which is sensitive to that. Now, what we have to do is set priorities and say that some treatments are more important than others. Varicose vein treatment for old ladies with leg ulcers is more important than for those who want cosmetic procedures done. HUMPHRYS: If you take your own experiences as a GP, and somebody comes along to see you, half a dozen people come along with varicose veins, say "Look doctor, I want these sorted", one of them you believe as a GP ought to have them done because of god clinical reasons, others for cosmetic reasons, you're going to find it terribly difficult aren't you to say to five of them, sorry you can't, you're gong to pay for it, the other one's going to get it free. They won't quite understand, it's going to be terribly difficult. This is why ultimately if decisions on rationing, and let's be clear, this is what we're talking about, we're talking about rationing, and I know politicians by and large don't like to talk about rationing, but this is what we're talking about.... FOX: I don't have a problem with the word. HUMPHRYS: Alright, good, most do, and when you're in office perhaps it will be different, if you're in office. But the fact is rationing has to happen, it has to be decided by the politicians. FOX: Well, I don't actually agree with that because I think that what we should be looking at is the way of deciding treatment times that are done for specific patients. You use the varicose vein example - let's stick with that one. I think we need to have system in place where the patient's waiting time is dependent upon the clinical condition, and obviously somebody with varicose veins with a complication requires a much shorter waiting time than patients who have no complications. Now... HUMPHRYS: You are rationed by the waiting time... FOX: Well, that is how I think it is fair to do. I think that the sickest patients should be treated first, and I think those with minor complaints should take their appropriate place in the queue. Now... HUMPHRYS: Or go private? FOX: Well that's anybody's choice at any point whether they want to go private or not, and a hundred-and-forty thousand patients per year in this country choose to buy their entire treatments privately, and that's four hundred thousand more since Labour came to office alone, so that's already happening, so we mustn't pretend ... HUMPHRYS: And you know that, and you would like to see that continue. That would be part of your aim, to encourage, I was going to use the word force, I won't I'll use the softer word encourage, encourage people to do it. FOX: Well I think there's a huge difference between the two. I would never force anybody to have to buy the treatment outside the NHS. HUMPHRYS: You'd have to use the word encourage. FOX: I think if people feel that that's a reasonable choice for them I don't have a problem with that, and I can't understand.... HUMPHRYS: It's a bit stronger than that. If people feel that's a reasonable choice for them, they would only feel that if the alternative was not available, and you're saying we will so order things that the alternative will not be available. That's basically true isn't it? FOX: Well, it's also about the cost of it too, and it's not just about the availability. HUMPHRYS: Back to private insurance. FOX: Well, I think that's.. again I think we need to look at how we can encourage it across the board without harming a patient's faith in their ability to get treatment free at the point of use, which I think as a doctor I regard as the most important point of all. But we have to look and see what we could get with a better partnership. The word I was amazed wasn't used in any point of your film was this idea of partnership. Now in many other countries there is a much better developed partnership than we have in the United Kingdom. In the United Kingdom we already have quite a number of patients in the NHS who get their treatment paid for by the NHS but in the private sector. That's about forty thousand patients a year, so in fact as Labour again came to office, a hundred-and-twenty thousand NHS patients have been treated in private sector which is bigger than Labour's reduction in their waiting lists. But within that I think there are big problems. Number one is which patients to treat. One of the most I think staggering statistics is that last year the number of heart by-pass operations in the NHS fell for the first time in twenty-five years, it fell by four-hundred-and-fifty, at a time when the government were actually buying increased number of treatments in the private sector, and a lot of those were things like sterilisations, inguinal hernias, and that says to me that's a bizarre..... HUMPHRYS: We don't want to go into too much detail but simply so that people will know what we're talking about. FOX: Hernias. HUMPHRYS: Okay, oh yes. FOX: We won't go into that. It's lunchtime for a lot of people. HUMPHRYS Well, precisely. FOX: And I think that it's important that we actually get a sense of priorities, and I think to be reducing the number of heart operations at the time you're increasing minor complaints being treated is immoral. So we have to get back to a whole proper system that's clinically driven, and I think that's what we're missing at the present time, and we could do that. We could actually dramatically increase the number of NHS patients treated. If every private hospital dealt with just three more surgical procedures a day that would treat a hundred-and-seventy thousand more NHS patients a year, that's a huge increase. If we prioritise that properly we could actually try to move towards the sort of health results that they have in other countries that were mentioned in your film. HUMPHRYS: Right, so let's be clear about this because it's an important part of the policy this isn't it. You would say there are some things that the NHS has to do and we've always said that of course, if you have to have open heart surgery, if you have cancer whatever it happens to be we will say to you we absolutely guarantee that you will have those operations in double quick time as quickly as medical conditions demand and nobody is going to wait beyond that particular time but of course there is a price to be paid for that and you are prepared that we should face up to that price? FOX: Yes I am. At the moment you see there is huge distortion in the system. The current waiting list initiative is all about numbers, it's about simply getting the appropriate number of patients treated whether or not they're the right patients, whether or not they're the sickest patients and I think that's a dreadful way to run a system. I think the sickest patients should be treated first even if that means people with more minor conditions taking their appropriate place in the queue. At the moment that queue is distorted simply to try and make the numbers look good and that can't be a fair or equitable basis of running a health care system. I find that ethically quite unacceptable as a doctor that we do that so we have to make sure the sickest patients are treated first and it shouldn't matter to us where patients are treated, it should matter to us when patients are treated and the quality of the treatment that they get. HUMPHRYS: Right, so if it means buying a bed in a private hospital you're absolutely happy with that? That would be fine? FOX: And the government have recently moved onto our territory which I welcome..... HUMPHRYS: ....indeed.... indeed, we had the health Secretary Alan Milburn saying that precisely on this programme a couple of weeks ago but also acknowledging of course that there is a cost involved in that because if you're buying beds from the private sector it is going to cost money. FOX: Well the NHS of course has massive purchasing power and should be using its purchasing might to make sure that it gets value for money. It's also difficult to measure it against what it costs in the NHS because we don't measure things very well in the NHS. So that's a difficult problem and it's impossible to give you an exact example answer to the question which you're asking which is 'would it cost more per procedure in the private sector because we really don't know very well how much we're talking about here. HUMPHRYS: But whether it would cost more to do this operation in this private hospital than in that NHS hospital is not so much the point, the point is that there would be extra work being done, there would be more operations carried out ..... FOX: .... because there is more capacity in the private sector. You'd see we've be running the NHS closer and closer to full capacity because we talk about efficiency gains and there's a limit to the efficiency gain you can get in the NHS and doctors and now working flat out, operating theatres are working flat out, nurses working flat out, so we have to try and find some spare capacity somewhere else and that can be found, I think to an extent, in the private sector. In the longer term we have to increase the number of doctors and nurses that we have working in both the NHS and the private sector but it's an interesting thought that of all the nurses who've left nursing and left the NHS in the last four years, only four per cent have actually gone into the private sector. The majority have simply stopped working altogether. These are the people we have to try and get back. In the longer term our constraints and going to be manpower, in getting doctors and nurses working in both parts of the healthcare system. HUMPHRYS: Right. So we've made this absolute commitment, a Conservative government would make that absolute commitment to people who are really ill and need these operations and you will spend, effectively, whatever it takes. There is no.... there can, by definition, be no limit to your spending promise here? I mean what you're saying to them is whatever it costs you will have that operation. Now clearly there are knock on effects from that aren't there and clearly one of those effects, unless you're going to find a magic pot of gold under some rainbow that we haven't yet discovered, unless of course it is private insurance, you're saying to people - you'll have to find another way of doing those other less urgent operations? FOX: Well there's a big assumption in your question which is that there is unlimited demand. We have of course tried to assess what demand might be there which may suddenly come into the system if the constraints that doctors normally work under are removed. In other words if doctors are allowed to decide the maximum times for their patients themselves rather than being constrained by the system. Now what we've done is to look, for example, at the range of surgical procedures and to see what doctors think they ought to be doing and comparing that against what they're actually doing and to our amazement we find in many areas for example in prosthetic surgery we find that what doctors say they should be doing is exactly the same as what they're doing, so it seems that the capacity in that particular area is roughly the same as the demand. HUMPHRYS: Well it might be in that particular area but you can't be sure across the board can you that ....... FOX: No. No. that's right.... That's right and we've looked at other areas for example in gall bladder surgery there's quite a big difference, there's about a thirty-five per cent difference between what doctors say they ought to be doing and what they're capable of doing so we know there that we have to try and find extra capacity. We have a group of very senior cardiologists working at the moment on the same problems in heart surgery. But one of the problems we face at the present time is that politicians are giving arbitrary waiting times. Now not everybody waiting for a particular type of surgery is as urgent as everybody else waiting for that particular type of surgery. If you take again prostate cancer as a good example, a number of patients would clinically require surgery within a month but a good number could actually wait six, twelve months without any difference to the outcome of their disease therefore it makes no sense to give everybody a three month waiting time. What it does make sense to do is to operate it on a patient by patient basis and say 'You're an individual patients therefore you get an individual guaranteed maximum waiting time' and that's what we want to do and I think that's a much better way of running a system than we've done in the past. You know artificial targets are very attractive to politicians because it lets them say, 'well we want all waiting times to be done within three weeks or six months.' It's a nice headline figure for the newspaper but it's not a very good way to practice medicine and I didn't give up my career in the NHS to come into politics to see politicians carrying out policies which I don't think, in the end, are very patient orientated. HUMPHRYS: But the realistic outcome of all of this is at the moment you may have to wait a very long time for a hip operation - I mean let's not take something that might be cosmetic like varicose veins - take something like a hip operation which is not life threatening, probably not anyway, but extremely painful and people want it done and want it done as quickly as possible. There is the strong likelihood, some people would say the certainly, we heard various contributors in that report by Terry Dignan, some people would say there is the certainty that those people would be pushed so far down the queue that they would end up with no alternative but to buy that operation privately. You're attitude, ultimately, to that is - that's fine, take out private insurance and we will try to make that more affordable for you. FOX: No, that's not my attitude. Now let's think about the logic here, if we are treating the same number of patients with an increased amount of money it's hardly likely that the maximum waiting time would increase... HUMPHRYS: Now, the premise is dodgy though isn't it. You cannot be sure that it would be the same number of patients. It's highly likely that the number of patients would increase for reasons that were put forward in that film by Madsen Pirie. FOX: I think that's a very debatable point and I would say that it is possible to predict the demand at least to a relatively reasonable level.. HUMPHRYS: History suggests otherwise.. FOX: Well I would disagree with that given the work that we've done, but the question is how do you get, let's call them the not-life threatening but serious conditions, for example severe arthritis of a hip, how do we get those treated. Now there are two problems in the system at the moment. One is the overall capacity which I mentioned in the NHS, the other is the fact that in orthopaedic units you will always have to give priority in surgery to road traffic accidents and very serious short-term conditions. Now, how do we avoid that, one of the things that in fact has been proposed and the government seem quite keen on is to move to stand alone surgical units. In other words we have dedicated units that would do only routine hip operations and nothing else. They wouldn't take any emergency patients... HUMPHRYS: ..still cost money though, resources still have to be put into it. FOX: Of course it will cost money but it's about creating a system which is more predicable. Now in the increase in funding that's coming forward which the government have proposed and which we would match, I think we have to be looking at that increased amount of money and saying rather than pour it into the black hole that we have at the moment, not knowing where the money is going to go, we actually now have to try and decide where we get the best increase in the amount of patient care for that particular amount of money. And if the government bring that in in their national plan which they are going to announce then I would welcome that as long as certain procedures for quality were being followed. HUMPHRYS: Let's look at another big part of the budget and that is drugs, particularly nowadays as we have had the debate this week about Interferon, how expensive that is, ten thousand pounds a year, a huge amount of money but a lot of people say they get benefit from it and the National Institute for Clinical Excellence, NICE, said well we don't think actually it's a very good idea because - we know all the arguments for that. Now you would set up an exceptional medicines fund and as I understand it that would provide cash for these exceptional drugs, exceptional in the sense that they are new and terribly expensive and all the rest of it, so you'd get rid of, in theory anyway, you'd get rid of this sort of postcode rationing that we have at the moment. But this also would cost a great deal of money because you would be blamed if the drugs were not available so you would have to say, or this fund would have to say, look we need more money now because we have run out of money. You'd have to give it to them wouldn't you? FOX: Well, let's be completely frank about this debate, we are talking here about rationing in healthcare in the United Kingdom, we all know it takes place. I find the concept of postcode rationing that you can get a drug on one side of the side and not another, I find it deeply offensive and unethical. I think that we have to accept however that we can't afford everything all the time for all patients. I think more reasonable people would accept that. Therefore, we have to find a way of making drugs available on a more equitable basis. Let's take Beta Interferon as a good example... HUMPHRYS: ..for Multiple Sclerosis sufferers.. FOX: For Multiple Sclerosis. At the moment, the mechanism will either say everyone gets it or nobody gets it, I think that is preposterous. If it's useful for a particular type of patient, particular type of MS sufferer then I - where we can prove that it is effective, then I say that should be available for them throughout the country irrespective of where they live, but it may not be available for all patients with MS. What I think we have to do, is to get a mechanism in place which actually makes prescribing criteria more scientific which is based more on the medicine and doesn't try to be an all or nothing solution because that is simply not going to be sensitive enough and when we move into new areas looking forward in medicine to areas of progress in genetics for example, where we may be able to identify more precisely which patients may benefit from a drug, we have to have a mechanism of being able to prescribe it and set criteria for doctors to prescribe it and where the funding follows that, and I don't think that what we have in place at the moment actually allows us to do that and I do think that the models that we have for healthcare should be based on looking forward to this century rather than back into the last century. HUMPHRYS: But ultimately it has to be the politicians doesn't it, who makes these decisions. You can't leave it to clinicians, you can't leave it... FOX: Yes it does, which is why I think it is much more honest to setting a particular fund where the total amount is set by the Secretary of State.. HUMPHRYS: Or you'd be unpopular then if some drugs where not available wouldn't you.? FOX: Well isn't that the appropriate role for a politician, I am answerable to the electorate and therefore it is appropriate that the politician makes the decision. It is not appropriate that something like NICE, the National Institute of Clinical Excellence, makes decisions about that, it's my job to make sure that patients get the quality of care, it's my job to make sure they are treated where they can be treated best, in the shortest possible time and that we eliminate postcode rationing. I think all of those are the appropriate jobs for the politician and it's not something I would duck in office. HUMPHRYS: Dr Liam Fox, thank you very much indeed. FOX: Thank you.
NB. This transcript was typed from a transcription unit recording and not copied from an original script. Because of the possibility of mis-hearing and the difficulty, in some cases, of identifying individual speakers, the BBC cannot vouch for its accuracy.