Developing a Comprehensive Productivity Model for the NHS: A Quantitative and Theoretical Analysis

Productivity in the NHS has long been a critical concern for policymakers, given the increasing demand for healthcare services, workforce shortages, and financial constraints. The 2025/26 NHS Priorities and Operational Planning Guidance sets a 4% productivity improvement target, yet it lacks a detailed methodological framework for measuring or achieving this goal. Current NHS productivity assessments predominantly rely on input-output ratios, which fail to capture the complexities of modern healthcare delivery, the impact of workforce efficiency, technological advancements, and variations in patient complexity.This paper develops a quantitative NHS productivity model based on economic production theory, integrating labour, capital, service volume, efficiency metrics, and quality-adjusted outputs. Using a Cobb-Douglas production function, this model accounts for interactions between different healthcare inputs and total factor productivity (TFP). By incorporating both quantitative and qualitative performance measures, the model provides a more accurate and policy-relevant approach to evaluating NHS productivity.The analysis highlights that simplistic productivity measures, such as those used in NHS policy documents, lack the granularity required for evidence-based decision-making. The proposed framework allows for empirical estimation of NHS efficiency, providing valuable insights for policymakers, healthcare managers, and economists. This study advocates for a structured, data-driven approach to productivity measurement, enabling NHS leaders to optimise resource allocation, improve workforce planning, and leverage technological innovations effectively.By moving beyond generic policy directives, this model aims to establish a rigorous analytical foundation for NHS productivity measurement, ensuring that productivity gains are achieved through genuine efficiency improvements rather than short-term activity increases.