Jane Kirby

THE NHS should switch to a form of health insurance to better compete with other countries, according to a report out today.

The study, from the think- tank Reform, said two factors were crucial in the "battle for health supremacy".

These were that the health system provided universal coverage and that it had strong insurance incentives.

The report said Switzerland and Japan were the best performers on both of these fronts.

These countries are followed by France, Germany, Australia and the Netherlands but the UK and US lag behind.

For the UK to catch up, says the report, it must introduce more insurance incentives into the system, including giving patients a choice of organisations that offer insurance for healthcare; providing clarity over healthcare entitlement; and encouraging people to take more responsibility for their health.

The report suggests a new model - a National Health Protection System - where people are able to invest a £2000 per year tax-funded premium.

This is the amount the government currently spends per head per year on the NHS, it said.

The new model would also allow for a top-up system of supplementary insurance to cover rare drugs and "luxury" items.

Andrew Haldenby, director of Reform, said: "The Olympics showed that an open-minded, elitist and rigorous approach can put Britain in the top rank of countries. Healthcare is no different.

"The Prime Minister has said that the NHS is the best insurance system in the world - it isn't yet by any means, but that is the right ambition."

Karol Sikora, a consultant in cancer medicine and an author of the report, said: "This document examines for the first time the compelling concept of a core universal insurance policy for all, underwritten by competing public and private groups and regulated by government.

"It would remove politicians from micro-managing our health system simply to attract votes."