Last Updated: March, 2019

Medicare is a social health insurance programme for elderly people in the US. It is publicly funded but privately delivered with a budget that is twice that of the entire NHS.

In 2007 Seffie Himmelstein and David Woolhandler two Harvard professors proved that the UK would be wrong to adopt a similar system to Medicare. Their paper warned that when private companies took over the delivery of public health care it was followed by worse outcomes for patients, cherry-picking of profitable patients, soaring administration costs, public money diverted to profits, fraud on an industrial scale, kickbacks for doctors, the abandoning of unprofitable contracts, and eventual government bailouts for private companies that couldn't make a profit.

Their paper reported higher death rates in the US for privately-run for-profit hospitals and renal dialysis centres than in not-for-profit ones.


The entry point for this sort of private clinical provision in the UK came in the form of  Independent Sector Treatment Centres . There have been many scandals since, here is a flavour:

In 2014 it was reported that Healthcare at Home - contracted to deliver medicines direct to patients - was failing to do so. Their substandard service was compounded by the failure of Medco Health Solutions who's patients were transferred to Healthcare at Home when Medco 'withdrew from the market'. Healthcare at Home had the nerve to reapply for its contract, and the Department for Health told commissioners that their past performance could not be taken into consideration.

In 2014 the Centre for Health and the Public Interest reported that 800 patients had died unexpectedly in private hospitals since 2010. The main findings include:

  • The majority of private hospitals have no intensive care beds, some have no dedicated resuscitation teams. Surgeons and anaesthetists usually work in isolation - without assistant surgeons and anaesthetists present.
  • There is significantly less information available to patients about the performance of private hospitals.
  • Thousands of people are regularly transferred as emergency admissions to NHS hospitals following treatment in private hospitals (over 2,600 in 2012-13)

In 2014 Musgrove Park Hospital terminated a contract with Vanguard after half its cataract patents experienced complications. An investigation conducted by Musgrove Park Hospital was leaked revealing:

  • Vanguard was attempting to do 6 more operations per day than considered safe in the NHS.
  • Vanguard had subcontracted the supply of surgeons and equipment to another company, who in turn had subcontracted the supply of equipment.
  • Training was going on when the first patients arrived in the mobile operating theatre.

In 2014 the British Medical Journal reported that between 10 and 25 percent of global spend on public procurement of health is lost through corruption. More than a third of GPs on  Clinical Commissioning Groups (CCG)  have a conflict of interest due to directorships or shares held in private companies from which they can potentially commission services. In the same year Pulse Magazine reported that 1 in 5 GPs sitting on CCGs had a financial stake in a private company already contracted by their CCG. Privatisation is drastically increasing the opportunities for fraud in the NHS. Many of the corporations carving up the NHS have already been indited in the US for fraud.