The Effects Of An Ageing Population On The NHS

The Effects of an Ageing Population on the NHS

Jack Bateman-Chuah 11072043
A six-part series, Utopia, (Munden, 2013) was debuted on British television on Channel 4 in January 2013. It detailed the lives of a group of people thrust together through an online forum, where they about conspiracies. They quickly became embroiled in a shadowy organisation’s plan to combat the growing problem of overpopulation. The plan failed due to their efforts but the implications of the series do touch on a very real and difficult problem now facing us.

Overpopulation is not a new problem, having been seen in many smaller scale instances such as Easter Island. However, for the first time in history an ageing population is a significant variable. “Population ageing is unprecedented, without parallel in human history and the 21st century will witness even more rapid ageing than ever before” (Scott 2015).

In the 1980s in Britain, a “trend of early retirement” (Mullen 2002) became commonplace among major industrial companies. It was looked at as “a fairly ‘bloodless’ way of coping with redundancies and unemployment” (Mullen 2002).
However, in the years that followed these workers came to be considered unproductive. “Increasingly the spectre of a demographic time bomb, of an ageing population, was brought into the discussion, to emphasise that these non-working people were becoming an intolerable burden” (Mullen 2002).

These people are the same ones now considered a burden on the National Health Service (NHS) in the UK. Due to improvements in our understanding of health and diets, as well as huge medical leaps, “the average life expectancy in Britain has increased by 30 years” (Royal Geographical Society, 2009) since the start of the 20th century.
The other significant factor is that birth rates are actually declining, which on the face of it seems contradictory. Birth rates have dropped from 2.93 children per family in 1964 to 1.9 per family currently. What this creates is a population that is producing fewer children but living far longer, hence we have an ageing population.
“The implications of an ageing population are all around us, with issues of increasing healthcare and social care costs, and a perceived pensions crisis” (Hughes, 2013). These issues highlight not only the current problem but also the inevitable exasperation of the problem year on year as people of a working, taxable age continue to diminish, thus reducing the actual revenue received by the government in the face of a growing social security bill.

According to predictions from the US National Library of Medicine in the table below, for the next 16 years under 65s are expected to remain stable, while over 65s are expected to more than double:

Change in population of United Kingdom by age group, 2001-31

Males

Females

Age group
2001
2051
Change (%)
2001
2051
Change (%)
Under 65
24 689
24 256
−1.8
24 790
25 047
1.0
65-74
2 304
3 523
52.9
2 636
3 906
48.2
75-84
1 306
2 186
67.4
1 983
2 697
36.0
≥85
312
798
155.8
816
1 242
52.2
Total
28 611
30 764
7.5
30 225
32 893
8.8

An ageing population is calculated “as the number of persons 65 years old or over per hundred persons under the age of 15” (United Nations, 2001); for example if we had 120 over 65 for each 100 under 15, our populations ageing rate would be 20%. Similarly, we can work out the Dependency Ratio as “the number of persons under the age of 15 plus persons aged 65 or older, per one hundred persons between 15 and 64” (United Nations, 2001). As we can see from the table above, using the cross section provided, the projected change in over 65 year olds as a total of the population moves from 18.90% in 2001 to 29.07% in 2051. Excluding those not of a working age, this gives us a dependency ratio of “4 working people supporting each person over 65 in 2001 to just 2 working people for each person over 65 in 2051” (Royal Geographical Society, 2009).
While these are just estimates, the general consensus among sources and research is that by 2050 over a quarter of all UK citizens will be over 65. This equates to around 19,250,000 by 2050, compared to 10,000,000 currently, (Cracknell, 2009) which, considering growth in the lower age brackets remains static, is a significant change.

The NHS is currently going through what half of the current chief executives and other important stakeholders call “the worst financial situation to date” (Spicer, 2011). Their report stated “delivering NHS reforms and savings simultaneously was the biggest barrier, with 85% ranking this their top concern, as well as concerns over a lack of certainty of the reforms” (Campbell, 2015). Perhaps the most concerning part of this report is that the majority of those involved in the NHS expect waiting times to severely increase over the next few years, which could be potentially fatal for individuals with serious injuries or illnesses.

The NHS has been a national icon for the last 65 years, the envy of countries around the world, offering free healthcare to all who required service. “An excellent early reputation for cost effectiveness and equity, based on integrated services, minimal management costs and a vast practical pooling of risk has dwindled slowly” (Pollock, 2004).

Recently, it has struggled with the sheer demand of patients and the quality of care has receded in particular hospitals and districts.
Problems can be categorised into key areas such as population growth, financial difficulties, job losses/shortages and poor investment decisions. The latter issues have been fairly well documented in recent years; “the NHS is having to make £20 billion of savings” (Spicer, 2011) due in part to the UK’s current deficit, budget cuts and the recent years of recession, as well as David Cameron’s less than popular decision to “take £3 billion out of the front line of the NHS to reorganise the backroom” (Spicer, 2011). Take into account that this year alone, “three thousand doctors were hired from overseas as the service battles to tackle staff shortages” (Campbell, 2015) and we get a clearer picture of the difficulties faced.

An ageing population is, however, a different kind of issue to the ones listed. It is more complicated to define and resolve. In the UK, we as individuals look at well being and health in an egoist fashion, where we look after ourselves first, determined to prolong our own life, even at the expense of others. It could be argued a normative egoist variant is more appropriate as we do consider those close to us but one’s self is still very much the priority.

This, therefore, makes it difficult to look at the ageing population and question at what point, if any, do they infringe on the rights of everyone. For an isolated example, we can look at cardiovascular disease where “the increase in the number of older people will lead to an increase in the number of people who have chronic diseases, including cardiovascular disease. This will impose further workload and financial pressures on the NHS” (Majeed & Aylin, 2005). With cardiovascular system diseases the most common cause of deaths in the UK, is this an additional workload that NHS can bear? Can we possibly regard this prediction as a potential solution, that in the view of utilitarianism, cardiovascular disease may actually help ease the pressure on the NHS, allowing the majority to benefit for the sake of a few. At what point does one life become less important than another’s? There is, of course, no absolute answer to this question but by definition “utilitarianism relies upon some theory of intrinsic value: something is held to be good in itself, apart from further consequences. It is possible to compare the intrinsic values produced by two alternative actions and to estimate which would have better consequences” (Mill, 2010). With this perspective in mind, the alternative actions available to us are: a lower level of healthcare for all or a potentially higher level at the expense of those over 65. It could be argued that the needs of the many outweigh the needs of the few, but with the few constituting up to 25 percent of the population in the near future, they are hardly a ‘minority’.
This type of rational should be a total non-starter as cutting off those most in need of medical attention is deeply immoral, even in the consequentialist view of the ‘greater good’. In the words of Emmanuel Kant, “in law a man is guilty when he violates the rights of others. In ethics he is guilty if he only thinks of doing so”.

The problems of an ageing population are of course not exclusive to the UK. “Health policy makers in many countries have expressed concern over the pressures that increased numbers of older people will exert on health care costs. Previous studies have shown that, in addition to increasing size of older populations, per capita expenditures have risen disproportionately among the old compared to the middle age groups” (Seshamani & Gray, 2002).
To examine the effects of population demographics on health expenditures, we should look at age vs. usage in order to determine and quantify “the relationship between age and utilisation or cost. Applying these utilisation and cost patterns to demographic structures over time enables calculation of the impact of changing demographics on health care utilisation and cost” (Seshamani & Gray, 2002).
The chart below is based on available data provided by the Organisation of Economic Cooperation and Development (OECD):

(X-axis = Age Groups: Y-axis = % change in per capita over time)

What is immediately clear from this chart is that the UK actually has the lowest predicted change in cost for people over the age of 65+ at just 8%, compared to other similar countries. In fact, this data actually predicts that those over 65 will change in cost the least over any age group.
Before we make any sweeping statements with regard to this data, there are some key figures not included in this chart that we should assess to give us a much more complete view of the UK’s predicament. “For combined NHS expenditures, the oldest age bracket had decreased in their real per capita costs, while the other age brackets experienced real cost increases” (Seshamani & Gray, 2002). However, this period of levelling out cost allocation amongst the age brackets is mainly down to costs being allocated away from over 65s for non-acute hospital care.
These differing patterns for changing health care per capita costs may show the differing needs of each age group, that those over 65 will need the majority of the health care as they are the most in need while the huge increase in cost for 15 – 44s is down to more social factors such as binge drinking and drug abuse.

We can also consider the shift in over 65s from direct NHS care into other private social care establishments, including nursing and residential home accommodation. “The market value of the nursing and residential care sector for older populations has increased by 43% from £5.1 billion to £7.3 billion, while the value of long stay hospital care in the NHS has decreased by 52% from £2.2 billion to £1.1 billion” (Laing & Buisson, 1990).

Most importantly, the actual cost of over 65s is around 84% per capita cost, which is significantly higher than any other age group, so while it has ‘decreased’, it still represents the most costly age bracket of any. Of course if the NHS is currently able to sustain this level per capita cost and it is not expected to change, it should in theory survive but this again fails to take into account the ageing population doubling over the next 30 years, requiring the NHS to grow in accordance with the population.

So far, we have predominantly focused on the NHS, over 65s and the general public. However, dealing with an institute of the volume of the NHS, we need to look further afield and address other stakeholders. In the words of Edward Freeman, “great companies endure because they manage to get stakeholder interests aligned in the same direction” (Freeman, 1984).
The NHS has its own acronym for stakeholder analysis, the “9 C’s”. Without meticulously listing them, they cover all expected stakeholders from customers to competitors. Competition is a crucial element for the unique situation of the NHS, as it only currently exists in the form of the private sector. However if the NHS situation continues to deteriorate, privatisation appears to be an increasingly likely possibility and is already underway, with companies like Virgin, Care UK and In-Health making inroads. There is an acceptance of the cognitive legitimacy of privatisation that has allowed the NHS to reorganise themselves to operate “in a new market-focused health service” (NHS Support, 2014) without irresponsibly placing the burden on the general public. The competition, or lack of it, is in fact something of a collaborative partnership, which is enabling the NHS to maintain itself but delegate specialist work out to private organisations. More decisions like this should go a long way to supporting the ageing population, especially if these partnerships continue to form and develop to better support those in need.
Another stakeholder to consider is suppliers and more specifically, drug companies. With “sales of over the counter medicines now equivalent to a third of the NHS drugs bill” (Blenkinsopp & Bradley, 1996) these companies turn over huge amounts each year to supply essential medicines to the public.

An ageing population is only likely to increase the revenue and reliance on these companies, giving them a disproportionate level of influence that can only be a concern over the long-term motivations of the NHS. There is the possibility of these drug companies providing the bare minimum to keep people well enough, ensuring the maximisation of potential profit on each individual at the expense of any moral considerations. Alternatively, we could see the NHS follow the US model, where “faced with increasing health care costs, insurance companies and employers in the US have supported groups which offer care more cheaply in return for the patient surrendering some freedom” (Lawrence & Williams, 1996). These freedoms include reduced choice for both the patient and the doctor, care in only selected hospitals and stricter care guidelines. While this may not appeal, alternatives must be fairly considered in order to ensure the NHS is not lost in the face of increasing workloads and cuts.

“Nearly all of the English literature on hospital competition examines an earlier set of NHS reforms – the 1990s internal market. This market allowed hospitals to compete on quality and price for bulk purchasing contracts but, in general, there is a near uniform consensus that the internal market never created significant incentives for hospitals to change their behaviour” (Cooper, 2001).
This lack of competition within the NHS has lead to the slow continuous decline in quality that has left it on its knees. Studies by Cooper & Gibbons found that “higher competition was associated with a faster decrease in 30-day AMI mortality”. “Competition is not only the basis of protection to the consumer, but is the incentive to progress” (Herbert Hoover, 1930). The NHS requires competition to help push up standards, improve efficiency and breed innovation. There are few markets in the world that are so utterly dominated and while the NHS is a unique situation, increasing competition from within can go a long way to combating the ageing population issue.

Introducing “a system of payment by results will mean NHS trusts and independent providers will be competing for patients and will be rewarded for improved services” (Newbold, 2005). Competition may well not truly exist until the NHS is fully privatised but there can be no doubts that internal competition is a key policy to tackling the growing issues of an ageing population. There will be issues with privatisation and it may not be popular but people work harder and innovation occurs most frequently when the pressure is on.
Of course, this isn’t the only viable solution, with Debbie Kleiner-Gaines from the Association of Medical Insurance Intermediaries (AMII) stating “I continue to be perplexed why David Cameron continues to rule out any form of tax incentives for those individuals willing to fund their own medical treatment as it reduces the burden on the state and potentially growing waiting lists”. This certainly makes sense for the NHS and for those individuals who prefer private health care. From the perspective of the government it’s easy to understand their reluctance to offer tax incentives and further reduce a budget that is already stretched but the potential savings made by the NHS would go a long way to covering any pitfalls caused and most importantly, improve the overall quality of health for UK residents.

For all its faults, the NHS remains desperately important to over 65s in the UK. While the effects of an ageing population will cause considerable complications in the future, all those involved with the NHS must ensure these complications are not fatal. “Picking the winners in this ageing world will be doubly important if, as some economist believe, demographics provide an overall headwind for investors in developed markets” (Stevenson, 2008). Investment may be moving to developing countries but the government would do well to consider institutes closer home. The UK cannot afford to lose its NHS at a whimper; it cannot be abandoned as it reaches a critical phase in its history.
Multiple solutions are open but the NHS has to step forward and embrace innovation, meeting the challenges of this ageing population before they are overwhelmed and underprepared. Decisions have to be proactive, not reactive; all those involved have to anticipate and innovate, with moral imagination and considerations towards ethics of rights. Mostly importantly though, collaboration with stakeholders is required, and in an era of profit maximisation it remains to be seen if this is a realistic proposition. As Friedman said “Business is business” and there is little profit in the NHS.

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