The numbers of people who may take out private medical insurance could significantly increase over the next few years if the patterns noted by one study are correct. Gavin Wallis, in his 2003 report ‘The Determinants of Demand for Private Medical Insurance: Evidence from the British Household Panel Survey’ found that when government spending on public health care increased around the turn of the new millennium, the number of people who had a private medical insurance policy reduced. As the NHS budget looks increasingly likely to be cut over the coming years, it might seem logical then that the number of people who have private health cover could increase. This could be because they may be concerned that the level of care on offer could become limited or they may wish to be covered in case they wish to top up their NHS treatment.


The amount of government spending on healthcare is described as having a ‘lag’ effect on the number of people taking out private medical insurance. This is because of the effect of funding on the length of time people have to wait for treatment and there is evidence to suggest that the longer the waiting lists for NHS care, the more likely people are to opt for private health cover. Waiting times are one of the main reasons why people take a quote for private medical insurance as private hospitals can provide a much quicker referral to see a consultant and for any operation that they may recommend. When people become ill, the majority wish to recover in the shortest time possible and so if budget cuts are made to the NHS in the near future and waiting times increase, a quote for private health insurance could become an attractive option for an even larger proportion of the population in the UK.