Productivity of the English National Health Service: 2017/18 update

Posted on 26 February 2020

CHE's latest Research Paper 171 written by Adriana Castelli, Martin Chalkley, James Gaughan, Idaira Rodriguez Santana

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This report updates the Centre for Health Economics’ time-series of National Health Service (NHS) productivity growth for the period 2016/17 to 2017/18. NHS productivity growth is measured by comparing the growth in outputs produced by the NHS to the growth in inputs used to produce them. NHS outputs include all the activities undertaken for NHS patients wherever they are treated in England. It also accounts for changes in the quality of care provided to those patients. NHS inputs include the number of doctors, nurses and support staff providing care, the equipment and clinical supplies used, and the facilities of hospitals and other premises where care is provided.

Between 2016/17 and 2017/18, NHS productivity grew by 1.26% when using the mixed measure of NHS input growth, which includes a direct (volume) growth measure for NHS Staff and an indirect (based on expenditure data) growth measure for materials and capital. Since 2009/10, NHS productivity growth has improved substantially faster than the overall economy, measured in terms of gross value added per hour worked (i.e. labour productivity). NHS outputs increased by 1.72% in 2017/18, adding about 0.35 percentage points to the cost-weighted growth rate. In 2017/18 NHS inputs show a modest increase of 0.46% when the mixed method is applied. The report also considers a range of alternative scenarios including using a fully indirect measure of growth inputs.

Full Report: CHE Research Paper 171 (PDF , 4,656kb)

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