Adam Smith Institute

According to Saturday's Times, the government's new 'five-year plan' for the future of NHS cancer services (due to be released today) admits for the first time that the UK has poor survival rates compared with Western Europe, the US and Canada. Long waiting lists for radiotherapy and chemotherapy, as well as rationing which means too few sessions of treatment are given, are at the heart of the problem.

Money isn't the issue here. Since 2000 the government has tripled spending on cancer, and the UK no longer lags behind Europe or North America on this front. The problem is structural. As Karol Sikova, the former head of the cancer programme at the World Health Organisation, told The Times, most of the extra money lavished on the health service has gone towards the salaries of people who don’t work with patients:

We have funded mangers to deal with targets while in France, Germany and Italy that bureaucracy just does not exist.

The government's addiction to targets is understandable, and, I think, based in a genuine desire to improve customer service. In the absence of competition and market forces to drive up standards, targets and regulation are the obvious option. Trouble is, they just don't work and have significant unintended consequences.

The only way to really improve the National Health Service (assuming its continued existence) is to create the freest and most extensive internal market possible. That probably means breaking the NHS up into smaller, more localized commissioning units which would fund patients (at a set treatment price) to go to the doctor or hospital of their choice (whether state or private), as well as the introduction of a capped co-payments scheme for treatment (like those that exist elsewhere in Europe).

Sadly, the government is not still not prepared to think that radically.

There seems to be at the moment fad for prefixing the word libertarian with a politically descriptive term and proclaiming that the latter justifies the first somehow and that they are mutually beneficial.

A recent example I came across was "On Being a Green Libertarian" in the latest copy of The Individual, a publication by the Society for Individual Freedom. The author of the article argues that his green beliefs can in fact be joined with libertarian ideology, creating an effective process for environmental protection. He correctly identifies the key tenets of libertarianism, as well as the irrational behaviour of most of the environmental movement in their clamouring for more legislation to enforce their arguments. But fails to expand on how the two ideologies can be married together successfully.

Most libertarians would suggest pricing, property rights and the common law as the answer. For example, if someone suffers from the ill effects of pollution then they can seek compensation through the courts. The person who pollutes will then be forced to price that compensation into their product before selling it on the open market. The negative environmental externalities would be internalized in the price, and people would then be free to buy their electricity (for instance) as they saw fit.  People would base their spending decisions on their own personally ranked concerns,  be they environmental, price or otherwise. The cost of developing nuclear power stations, tidal barrages etc would all be laid out in the prices offered to consumers, leaving them free – but not coercing them – to allow their beliefs to come into play. But power generators would indeed be reacting to the greatest demand, and how best to turn a profit – the free market at work.

In an ideal world it would be up to the 'greens' to argue, with well founded ideas, the best way forward and not seek to impose their ideology upon others through purely legislative means. They would change people's views so that they would then demand greener products from greener manufacturers.

Let the people decide how green they wish to be. They'll be libertarians...but with a hint of green.

There is a new survey out there from the always-interesting National Center for Policy Analysis It covers the rapidly growing global market for medical tourism. We have already blogged about it here . But it is now becoming clearer what lies behind the success of the global high performance hospitals.

The market leader is Bumrungrad International Hospital in Bangkok, which served a stunning 1.2 million customers from 190 countries last year. It is American-managed and creates returns of 20-25 percent each year. Many other hospitals are managed, owned or affiliated with prestigious American hospitals:

• Cleveland Clinic in Ohio has satellites in Vienna, Canada and Abu Dhabi.
• The Indian hospital chain Wockhardt is linked to Harvard Medical School.
• Johns Hopkins has an affiliate in Panama and in Singapore.
• Dallas International Hospital operates hospitals in Mexico.

All these hospitals are escaping micromanagement by third parties – or otherwise highly regulated markets – at home. And that's how they achieve such competitive pricing. It is not simply a question of lower wages for doctors and lower overheads for hospitals. It is the absence of third party bureaucracies (which do so much to drive healthcare inflation) which allows these hospitals to provide such high-quality, low-cost services.

These hospitals are free-market laboratories serving cash-paying patients. That gives them the edge of performing at the frontier of medical and managerial innovation. Bill Gates just purchased the supreme management software, Global Care Solutions, from Bumrungrad hospital in order to market it worldwide. We should expect more innovation being created overseas and then re-imported to strangulated hospitals in the US and Europe.