Strategy and development United Kingdom

The healthcare market in the United Kingdom

Drew Barrett
Author

July 26, 2017
Published On

The healthcare market in the United Kingdom has always been a strongly performing sector, offering numerous opportunities for French companies wishing to export their products and expertise across the Channel. Today, the sector comprises 4,500 companies employing 167,500 people in the UK. The healthcare market in the UK is one of the most productive in the world and attracts nearly 10% of R&D investments, with an annual turnover of £60 billion in 2016. It is characterized by strong innovation due to existing partnerships between companies, universities, and healthcare services.

The National Health Service (NHS)

In England, the public aspect of this sector is embodied by the NHS (National Health Service), under the auspices of the Department of Health (the British equivalent of the Ministry of Health). The NHS budget for the year 2015/2016 was £116.4 billion.

Regarding demand, it is important to note that between 2000 and 2008, total healthcare expenditure per capita in England increased significantly faster than the OECD average (+5.3% per year on average compared to +4.1%). They then decreased by -1.8% per year on average between 2009 and 2011, while the average for member countries increased by 0.2% over this period.

Health and Social Care Act

In 2012, a significant change occurred with the Health and Social Care Act, which changed the economic landscape of the sector with the reform of the NHS. However, more than 90% of English practitioners were opposed to this reform, which required them to manage decentralized budgets, purchase, and streamline care on behalf of their patients. Medical organizations, in particular, express concern that such decentralization, opening the healthcare system to market forces, destabilizes NHS hospitals and promotes health inequalities.

Rise of the private sector

As in many sectors, there is a rise of the private sector, which is not only linked to government decisions but also to people's propensity to prefer access to "higher quality" care through private facilities. For this reason, Private Medical Insurances (PMIs) are expanding and broadening their available offerings. The largest PMIs in the UK today are BUPA, AXA PPP Healthcare, and Aviva.