In pursuit of an improving National Health Service.

The British National Health Service (NHS) before its 1990s internal-market reforms was a gridlock of perverse incentives. The internal market, an attempt to introduce some market incentives, stimulated much innovation in primary care commissioning and practice improvement and led to increased efficiency. However, its effects were quite limited, because the essential conditions for a market to operate were not fulfilled. There now exists a crisis of confidence in the quality of care in the NHS. It is doubtful whether a culture of innovation, efficiency, and good customer service is possible in a public-sector monopoly whose services are in excess demand and whose units do not get more resources for caring for more patients. It also is doubtful whether the NHS can modernize without consumer choice, competition, and more resources.

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