Brexit and the UK healthcare system
We won’t know the full impact of a Brexit on the UK, European and global economy for weeks, possibly months. However, the current economic and political climate is proving highly volatile to most sectors of society in the UK, including healthcare, the automobile industry, construction and housing, to name but a few.
Within the healthcare sector, the UK’s decision to break from the EU will likely impact upon pharmaceutical companies, employers and employees, doctors and patients, and healthcare research protocols. The structural framework of the healthcare system will be dramatically altered as relationships are severed and reformed.
Money matters in the Brexit fallout
One of the most fundamental issues is naturally money. It has been argued by pro-Brexit campaigners that the UK gives exorbitant amounts to the EU which could otherwise be spent on the UK’s NHS, and many voters supported the Leave campaign based on the promise of more money for healthcare. However, even Brexiteers such as Nigel Farage have found problems with this approach in that it is difficult to pinpoint precisely how each penny will be redistributed to the NHS.
Official figures indicate that the UK’s net contribution to the EU in 2015 was £8.5 billion. This amounts to 1.16% of the UK’s total public spending of £735 billion between 2014/2015. Those campaigning for British independence argued that this 1.16% of the UK budget would be put to better use by bolstering the NHS. Now even that position has come under fire: according to the Economist Intelligence Unit, the healthcare sector would receive £135 less per capita after the UK divorces from the EU.
The overall risks of a Brexit are far-reaching for the NHS. The Royal College of Physicians, the British Medical Journal and Nature were all staunchly opposed to Britain’s exit from the EU. Their opinion was unequivocal: expenditure on healthcare would be cut as a result of the Brexit. Of the 2000 scientists who were polled by an editorial in Nature, an overwhelming number of them (83%) believed that the UK should remain in the EU. Their opinion was that on its own the UK is incapable of building, maintaining and creating the calibre of healthcare necessary for the modern age.
The Royal College of Physicians argued in favour of remaining in the EU for the same reasons. Presently some 125,000 students at UK universities are from other EU countries. A Brexit could potentially imperil the opportunities of foreign students to receive student loans and other financing by the UK government, especially since UK university fees are prohibitive. This would have broad implications for the profitability of UK universities which could see a substantially lower intake of enrollees.
The NHS and European doctors
The NHS is heavily dependent on physicians, physicians’ assistants, nurses and other healthcare workers who work with EU licensing and regulation. Approximately 30,000 doctors that are currently working for the NHS are trained in other European countries. However, the issue of work authorisation in the UK will likely not be as big a factor in the NHS debate post-Brexit as the issue of funding and cooperation between various regulatory authorities and the structural framework that exists between Britain and the EU.
With regard to employment opportunities in the UK, it is abundantly clear that a Brexit would put visa restrictions in play and complicate the process of free movement of healthcare professionals. There are also important implications for clinical trials, with the EU having approximately 500 million people from which to choose. The UK won’t want to lose access to a larger pool of inhabitants.
Currently doctors are only allowed to work 48 hours per week according to EU policies, and this could impact adversely on British doctors and their ability to work in Europe. Another concern for the NHS is the impact of a Brexit on research collaborations between the UK and the EU. Presently, 62% of all UK research in medical and pharmaceutical-related fields is conducted via international collaborative efforts. Many new medications and treatment regimens could suffer as a result of the Brexit.
For the pharmaceutical industry, the implications are negative through and through. UK pharmaceutical companies require EU membership to derive maximum benefit from cross-border R&D initiatives, and the massive bargaining power of the EU puts it in a much stronger position than the UK alone. It is still conjecture at this point but it is entirely possible that post-Brexit the European Medicines Agency (EMA) could relocate from London to another European city.
Spread betting companies have been carefully monitoring public perception in the UK and the EU to gauge sentiment as the complex process of disentanglement from the EU takes place. Already the British PM David Cameron will be stepping down in October and his successor is due to invoke article 50 of the Treaty of Lisbon to initiate the ‘divorce’ from the EU. The odds of a positive short-term outcome remain bleak, but the UK remains hopeful that it can emerge from the economic quagmire without too much damage.
For more information, trading education and offers visit Intertrader Direct
The content of this article is the personal opinion of the author and not Intertrader Direct. The information and comments provided herein under no circumstances are to be considered an offer or solicitation to invest. Nothing herein should be construed as investment advice. The information provided is believed to be accurate at the date the information is produced.