When budgets meet reality

On the excellent podcast "The Rest Is Politics", presented by Alastair Campbell and Rory Stewart, last week, Rory suggested that the NHS couldn't be expected to pay for everything. Drug prices are rising, people are getting older, etc, etc. Efficiency savings are required, etc, etc.

But why, Rory, why? And what happens to the people who now won't be helped because the budget of the service isn't big enough to include them?

What Is A Budget?

A budget is a best guess of what will be required. (Other definitions are available).

Some budgets will be very educated guesses. Some, sadly, will not.

Some will be surprisingly accurate and some will be surprised by an unexpected event that makes all the effort that went into creating them an absolute waste of time.

But budgets are not reality and never will be.

If the task is to build a bridge and the budget contains insufficient material to actually reach across the gap, very few would begin construction while imploring the gap to make efficiency savings so that the planned bridge will actually reach the other side.

And if the task is to look after the healthcare needs of a nation, what then?

Endless Need

Drug prices are rising, average age is increasing, conditions are becoming more complex -- the need is endless and you simply can't expect a health service to cover everything.

Why not?

If people have a health condition that can and should be treated in order to remove injury, restore function, reduce risk of imminent death -- it would be beneficial to them and to society for this treatment to happen.

(Of course it's good for society -- better health means the person can work, pay tax, spend money on other businesses, interact with other people for the common good...)

If the health service won't pay for it -- because it's a "won't" not a "can't" -- then our hypothetical person has two options:

• suffer
• pay for it themselves

There simply aren't any other options. And a huge number of people can't afford to pay for it themselves and so they will suffer. And maybe die prematurely.

Pay For It Yourself

Let's just break this down a little, starting with an extreme example:

• very rare conditions that are expensive to treat

Well, if they're particularly rare then we're talking about a very small number of patients. So if we split the cost of whatever they need across the country (i.e. fund it through the health service, paid for by central government), it's actually a surprisingly small amount each for us to chip in.

The other option is that the person who picked up this condition in the lottery of health will have to pay an eye-watering amount of money in order to be looked after.

Whereas the person who (for want of a better example), broke his leg while skiing, requiring a long, complex and expensive operation to put the shattered bone back together, will pay nothing. And he chose to go skiing...

I'm not suggesting that those who have an accident doing something they love shouldn't be covered. I'm also not suggesting that those who find they have a rare and difficult condition should be left on their own.

At the other end of the scale, we have:

• extremely common conditions that are cheap to treat

Multiply the number of these by the lower cost for each and you could well end up with a far higher bill than for our 'very rare conditions' example above. But of course you'd cover these people -- there are so many of them that it would make no sense to exclude them, wouldn't it?

So if you're not trimming from either end, where will the axe fall? Somewhere in the middle? Thus leaving quite a lot of people with moderately expensive bills? Is that meant to be better?

And, while the drug bill for the health service might be startling:

• the health service will be getting a good price due to economy of scale
• and what's the alternative? (The answer you're looking for is 'suffering'.)

What Good Is A Budget?

So what good is your budget? Are you going to arbitrarily stop spending once you've hit this budget-number which was just a best guess made some time ago?

What will happen when reality meets fantasy (i.e. this budget)?

Do you start telling reality that it's wrong? Do you tell the patient to make efficiency savings in the severity of their condition?

Because there are only two options, ignoring the budget and doing what's needed, or abandoning someone at their time of need because an Excel spreadsheet thrown together the previous year says so.

A budget is a useful way of estimating what's going to be needed to get something done. It is a terrible way to decide when to stop doing what is needed.

Because if the bridge is worth building, then finish it. The valley isn't going to get any narrower to help you.