Breaking down monopolies in the medical profession

An article from the IEA( Institute for Economic Affairs ) think tank on the problems of too few doctors in the NHS( see article below) this links to a previous posting by NHSreality on a similar theme


Breaking down monopolies in the medical profession

‘The monopolists, by keeping the market constantly under-stocked, by never fully supplying the effectual demand, sell their commodities much above the natural price, and raise their emoluments, whether they consist in wages or profit, greatly above their natural rate.’ So wrote Adam Smith in 1776, and he had corporations and statutes of apprenticeships such as that of the Royal College of Physicians in mind.

True to form, the Royal Colleges have never fully supplied the effectual demand for their services, their policy being to keep the numbers of Fellows as small as possible. They excluded the apothecaries, and later the general practitioners and specialists from the voluntary hospitals in the eighteenth and nineteenth centuries, and when the NHS began after the war, consultants made up a meagre 15 per cent of the medical profession in England, when at least 40 per cent were needed.

When Labour nationalised the hospitals in 1948 it added monopolies of its own. Socialists are ideologically opposed to private practice. They resent the way that consultants move between the NHS and the private sector. Thus Labour governments distorted the proportions of NHS consultants, general practitioners and junior doctors to minimise the number of private consultants. Constrict the proportion of NHS consultants, the strategy goes, and private practice cannot expand much, even if the NHS has far too few consultants as well.

The mechanism by which governments manipulate proportions of doctors is obscure.  It is done by expanding the proportion of hospital doctors who cannot be consultants. So, although ‘non-consultants’ made up 30 per cent of the medical profession in 1948, they were increased until in 2012 they had a monopoly of 43 per cent of NHS posts, an expansion that should have rung alarm bells decades ago. But if the health service was brought in line with better foreign systems, the number of consultants would increase by over 55 per cent and the number of general practitioners by over 50 per cent.

Waiting times

Governments thus have monopoly control over key parts of the health sector, public as well as private, and the consequences of state planning have been disastrous. Take waiting times for instance. The NHS has so few consultants that there have always been long waiting times, and there always will until we overcome the monopolies

For example, NHS patients who are referred to consultant outpatient clinics can wait for weeks or months for their first appointment. Time spent in waiting would be approximately halved, and certainly much reduced, if the number of consultants were to be doubled.

The same applies to patients who are referred to private consulting rooms. They too can wait, although waiting times are very much shorter than in the NHS. The reason is the same – there are far too few consultants. It’s a rough approximation, but outpatient waiting lists are inversely proportional to the number of consultants, and the number of consultants is inversely related to the number of junior doctors. This leads to a general conclusion that waiting times for first consultations are related to the number of junior doctors: they would be shorter if there were more consultants and fewer juniors.

This flatly contradicts the entire staffing policy of the Ministry of Health since 1948. The small number of NHS consultants is a bottleneck. It leads to a second conclusion, that private and NHS outpatient waiting times could both be sharply reduced.

However, having more consultants and fewer juniors would involve other doctors doing the service work that the juniors currently do. NHS statistics show that general practitioners admitted an average of one surgical patient every five days and two to three medical patients a week in 2012, and with a 50 per cent increase in their numbers, as described above, they could do many of the admissions themselves as general practitioners often do abroad.

The appointment of consultants at an earlier age, common abroad, would not however reduce surgical waiting lists greatly, because junior surgeons already do so many of the operations for them (although the increase in their number by over 50 per cent would help.)


Nevertheless, it is not widely known that nationalised medicine is based on the repetition of hospital work: that a general practitioner usually makes the initial diagnosis, a house officer repeats it, a registrar confirms it, and when the consultant finally arrives the worst of the problems are usually over. And when the consultant is there the house officer and registrar present each patient to him, so they have to go over everything a second time. Of course there are illnesses in which large amounts of work take place in the weeks following the initial evaluation, but again, junior doctors take the initial crucial decisions and critical steps in treatment. There are variations between the branches of medicine and surgery, but overall the repetition of work in the NHS is enormous.

Furthermore, the European Working Time Directive rules that after eight hours the first ‘team’ must hand over to a second team, with yet more doctors and more repetition. One result is that junior doctors see NHS patients as a series of short term ‘cases’ who they will never see again.

But if the whole population were to be treated as private patients within an upgraded health service, only one or two doctors would be involved in each medical and surgical case, and productivity (output per doctor) could be approximately doubled, or in some cases even quadrupled.


Furthermore, consultants would not have teams of junior doctors if there were not over-manning, because over-manning is a familiar post-war problem for all nationalised industries. Over-manning shows that the NHS has lots of spare capacity and that productivity could be several times higher than it is, i.e. by raising the output of work of individual doctors.

When general practitioners abroad manage their own patients in district hospitals the productivity of the medical profession is increased to levels unheard of in Britain. The culture of the NHS would be utterly transformed if the monopolies within the medical profession were brought to an end, and if general practitioners were able to work independently alongside consultants in district hospitals. This is legal, though it needs a Trust’s permission.

Medical emigration

The National Health Service has so few consultants that over the last 65 years tens of thousands of potential consultants, fully trained and desperate for senior posts, have been rejected and flung as by a lunatic centrifuge to the rim of the English-speaking world, especially to America, Canada, Australia and New Zealand.

This is partly the result of a further monopoly. Immigrants make up approximately 13 per cent of the UK population, but foreign doctors have a monopoly of 34 per cent of the consultant posts in England, 22 per cent of those in general practice, 72 per cent of the Senior House Officers, and 71 per cent of the sub-consultants posts where, as Assistant Specialists and Specialty Doctors they are unable to have private patients. Indeed, the quota for foreign doctors is so large that it has crowded out UK-born applicants for consultant posts, leading many doctors to conclude that they can only obtain the level of responsibility which they seek if they emigrate.

State planning in general practice

A further set of problems is evident in general practice. Firstly, there is the ability of a group of general practitioners to monopolise health services over an area of 100-200 square miles. Within this area they can outvote competitors and block useful change. For example, the doctors in a health centre can influence the decision whether or not a new practice is needed in the area, and veto it if they feel threatened. They can block the introduction of new technology if they haven’t been taught how to use it, and they can, for instance, monopolise anaesthetics in community hospitals to keep contacts with consultant surgeons to themselves. And they can veto the facilities needed for hands-on maternity to prevent their lack of obstetric skills from being revealed.

Group practices and health centres have monopoly power that greatly reduces the potential range and output of work of general practice. Moreover, some groups of general practitioners under-perform all their lives, yet they still have large incomes and job security because monopoly of their practice area makes it impossible for new doctors to enter the scene, no matter how uncompetitive the incumbents are.

A second issue is the planning of out-of-hours provision. In 1948 a single-handed practitioner could manage his patients out of hours without referring many people to hospital. Twenty years later, as I saw in 1968 when health centres and group practices were increasing in size, a doctor in a group of three could be rushed off his feet at nights and weekends. A further twenty years on in 1988, groups of five doctors were so overworked that the quality of the work they provided was sometimes, through no fault of their own, little more than referral to hospitals. By 1998 the Department of Health’s obsession with larger and larger groups had continued until doctors in many parts of the country felt they had to join together out of hours so that, while one or two of them worked themselves into the ground, the majority could rest. And finally, by 2008 general practitioners felt they had to band together in massive cooperatives of 100 doctors, or more.

This did not, of course, in any way increase their access to the equipment and the hospital beds they needed to treat people themselves, nor did it increase the time they had for individual patients. What it did do was to increase the number of patients they had to send to junior hospital doctors out of hours, especially to Accident and Emergency Departments, where in 2014 large numbers of seriously ill patients make their own way to safety, some to wait and even die because the queues are so long. So much for state planning.

Finally, there is the controversial problem of part-time doctors. Women currently have a monopoly of 47 per cent of all the general practitioner posts in England, and the Department of Health plans to increase the percentage until women have a quota of over 50 per cent. But many women doctors choose part-time work, specifically so that they can spend time during the week with their families.

In competitive healthcare systems abroad patients appear to value continuity of care more than choice of gender. They prefer full-time general practitioners who will always be available to them, full-timers who will not pass them over to other doctors and back again. There is a different, superior culture in industry where jobs are won by the best applicants, but this cannot happen in the NHS as long as part-time doctors are allotted by the state. The best solution would be choice and competition, but that is only available in private practice.

The monopoly of state finance

Perhaps the worst monopoly of all is state funding. NHS doctors are salaried. There are no financial incentives for them to do much more than the minimum for each individual patient, no incentives to be more productive, to develop new, faster and better services. The ‘dead hand of the state’ is everywhere, and productivity is poor compared to the competitive fee-for-service health services found abroad, where competition between doctors produces much better results

In summary, six decades of state monopoly have produced far too few consultants and too few general practitioners, too many junior hospital doctors, worse clinical outcomes than those of other countries, the need for huge numbers of foreign medical graduates, recurrent crises in specialist training such as the rebellion of junior doctors in 1966 and the crisis in graduate education in 2007, the problems of the European Working Time Directive, decades of wasteful medical emigration, the dumping of large numbers of patients onto Accident and Emergency Departments by general practitioners, and last and certainly not least – long waiting lists.

David Joselin is the author of The Crisis in British Medicine.


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