Adam Smith Institute

View Original

We're never going to get anywhere thinking like this - or not thinking to be accurate

The basic sentiment here we entirely agree with of course. Innovation, raising productivity, automation - they're the very things which make society richer over time. There's no reason whatsoever why such in health care won't do the same - thus we'd like to have innovation, rising productivity, automation in health care, yea even in the NHS.

Great, now, how do we get them?

From vaccines and antibiotics to memory metal stents that widen narrowed arteries and algorithms that process radiological images and let us see the earliest signs of disease, innovation has been saving lives since the inception of the National Health Service 70 years ago. It is this blend of new molecules, materials science and biomedical engineering, in partnership with digital systems, that will continue to transform our expectations of life and survival in the 21st century.

The problem with the piece, with the discussion, is that it ignores the two things we do know about such health care innovation. The first being that we've already tried that top down, planned, method. At this distance quite how much money was sprayed against the wall we're not sure. £13 billion was it on patient records? It certainly wasn't £1.3 billion and even Blair's NHS didn't waste £130 billion. Those interested in a more accurate number can look it up but the important point is that the output was zero. We gained precisely nothing at all usable from the expenditure of that much national wealth.

This is not the way to promote innovation. Which leads to the other thing which we do know about innovation, derived from the work of William Baumol - yes, he of the Cost Disease point.

Planned systems can invent but they don't innovate. Market based systems are about as good at invention and vastly, hugely, better at innovation. The distinction here being between creating some new thing and putting it to use. It is precisely the competition from other suppliers of goods or services which drives the application of new technologies. The fear of losing out as others do innovate to lower costs, higher productivity.

So, we'd like to have the NHS innovate, would we? That means having markets in the NHS, not a centrally planned system. Something that really needs to be mentioned in any discussion of how to get more innovation into the NHS, no? For yes, even the government still paying all the bills but with multiple suppliers will mean more innovation.