This review examines the performance of the UK healthcare system. After pre
senting data on the level and distribution of resources, three topics are e
xamined. The first is the lessons from international comparisons of evidenc
e on expenditure, equity and healthcare outcomes. The second is the lessons
from the recent internal market reforms. The third is the lessons from an
analysis of the role for private finance in UK healthcare. The review concl
udes that economists and policymakers need to focus more attention on the r
elationship between healthcare inputs expenditure - and health outcomes, an
d, within this, on the incentives facing suppliers and demanders of healthc
are.