healthcare spending
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Barbara Harpham, Chair of the Medical Technology Group, wants to see healthcare spending, particularly on medical technology, linked to tangible outcomes for patients, the economy and society

In June 2018, the UK Government announced an additional £20 billion in healthcare funding for England’s National Health Service. The cash injection – was warmly welcomed. The additional funding represented a 3.4% increase in the NHS’s budget in real terms over the next five years, meaning that although England still lags behind some Western European countries in terms of healthcare spending, the gap has narrowed.1

Following that announcement, Secretary of State for Health Matt Hancock outlined his vision for a health service that uses technology to ‘improve our health, make our lives easier and make our money go further’. His proposed strategy includes greater use of cutting-edge mobile and IT solutions.

These ambitions are laudable, but there is a danger that much of the investment could go to waste unless the health service takes a close, hard look at the way it currently procures products and services, taking into account the impact on patient outcomes and the potential savings to the healthcare system. It also needs to consider the broader economic and societal value to ensure that additional spending contributes to a healthcare system that is sustainable for future generations.

Better investment means a better society

Just over $7.8 billion of public healthcare spending in England – approximately 5% of the total annual budget – is spent on medical technology. Medical devices, of which there are around half a million – from in-vitro diagnostics, to implantable devices and e-health – play an enormous role in delivering better healthcare. They have a tangible impact on patient outcomes and healthcare budgets, often preventing the need for further treatment and hospital stays while enabling people of working age to return to the workplace.

The Medical Technology Group, in association with the Work Foundation, has studied the impact of MedTech closely. In our report ‘Keeping Britain Working – How medical technology can help reduce the cost of ill health to the UK economy’ – published in November 2017 – we reported that the impact of sickness, absence and worklessness associated with working-age illness costs the UK economy over $130 billion a year. Meanwhile, individuals collectively miss out on $5.2 billion a year of lost earnings and over 300,000 people take up health-related benefits.2

The report assessed the impact of eight technologies in reducing the need for further treatment and hospitalisations, limiting welfare and social security payments, as well as returning individuals of working age to employment as tax-paying members of society. It also explored benefits, such as improved quality of life for patients and the impact on the growing number of unpaid carers, who are able to return to work or contribute to society in other ways.

The study concluded that $618 million in savings could be generated in reduced long-term health costs and benefit payments from these eight technologies alone. An extra $1.3 billion – or 5% of the UK’s additional health- care funding spent on valuable medical technologies – could, therefore, generate even greater savings for the wider economy, in terms of reduced healthcare costs, lower welfare spending and increased tax revenues.

Focus on value-based commissioning

This vision for a future healthcare system where medical technology delivers its full potential is only achievable if the new cash injection by the UK Government is accompanied by a thorough review of healthcare spending.

For example, the current approach of buying the cheapest possible products urgently needs to be reformed. Instead, buyers and commissioners should ensure that value-based healthcare linked to desired outcomes becomes a key component of the payment system. This fundamental shift is needed to ensure value for the tax-paying public, the sustainability of the health service and access the most appropriate medical technologies for patients.

Rationing and delays are not the answer

Moving to a new payment system linked to patient outcomes and societal benefits will ensure we fund more of the treatments we need to keep the population healthy and able to work for as long as they need to. It will also help create a health service that is at the forefront of medical technology access and adoption for the next 70 years.

Meanwhile, rather than rationing access and reducing commissioning budgets, efficiency drives should focus on increasing the provision of cost-effective treatments. Health services must not confuse limiting access to healthcare with prudent decision-making.

Rationing, as exposed by the MTG’s recent Ration Watch campaign, is not a solution and delaying treatment only results in increased costs and poorer outcomes for patients in the long run.3 It also means that as a society we miss out on the enormous benefits of early intervention and rapid return of patients to their daily lives and activities.

A chance to lead the world in health

Additional funding in healthcare by national governments presents an enormous potential opportunity, not just for health services and individual patients, but also for wider society.

However, investment must be accompanied by radical reforms to the way the system operates. It needs a change in culture and practice and a joined-up approach that considers the broader impact of the investment.

Only then will we see the full impact of medical technology.

The Medical Technology Group is a not-for-profit coalition of patient groups, research charities and medical device manufacturers working together to improve patient access to effective medical technologies.



1 Eurostat:

2 Keeping Britain Working, How medical technology can help reduce the cost of ill health to the UK economy, Medical Technology Group, Nov 2017

3 Ration Watch


Barbara Harpham


Medical Technology Group


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