The NHS, we are often told, needs more investment to modernise. More money for digital transformation. More funding for innovation.
There is truth in that argument. Compared with many international peers, the NHS invests relatively little in technology. But in an era of constrained public finances, simply calling for more money is unlikely to be enough.
A more urgent question is how the NHS spends the technology budget it already has.
Recent analysis of NHS technology investment reveals a striking mismatch between the system's ambitions and its spending priorities. Around 65 pence of every pound spent on technology goes towards maintaining existing systems, including electronic patient records, infrastructure, software licences and back-office platforms.
Less than 10 pence is invested in the technologies most likely to transform care delivery and patient outcomes. These include remote monitoring, population health tools, virtual wards, preventative interventions and AI-enabled clinical support.
That matters because the NHS is simultaneously trying to deliver the three major shifts set out in the 10-Year Health Plan: moving care from hospitals into communities, shifting from sickness to prevention, and completing the transition from analogue to digital. Current spending patterns are not aligned with those ambitions.
The NHS invests around 1.5% of its overall budget in technology. Germany spends closer to 3.5%, while the US spends between 4 and 6%.
Yet the real issue is not simply that the UK spends less. It is that most of what we spend goes towards keeping the lights on rather than transforming services and improving patient care.
Analysis across more than half of England's NHS trusts suggests the service may be carrying between £1.5bn and £2.9bn in avoidable annual acute care costs. These costs arise from emergency admissions that could have been prevented, hospital stays that could have been shortened and virtual ward programmes that remain far below their intended scale.
Behind these figures are real patients. It is the family managing repeated hospital admissions for an elderly relative whose condition could be monitored safely at home. It is the patient waiting months for an appointment in an area that has not invested in technologies designed to improve access and productivity. It is the community where a virtual ward exists in principle but lacks the technology needed to operate effectively.
Technology investment is often treated as an IT issue. It is not. It is a strategic issue and, ultimately, a patient care issue. If it is not discussed regularly in NHS boardrooms, it should be.
Perhaps the most concerning finding is that technologies designed to support the NHS's much-discussed ‘left shift' away from hospital care remain a tiny proportion of overall spending. Remote patient monitoring, a critical enabler of safe and effective virtual wards, has attracted less than £37m nationally over four years. At current rates of investment, the NHS's ambitions for virtual care will remain difficult to achieve.
Regional inequalities compound the challenge. Some parts of England invest almost three times as much of their technology budget in transformational tools as others.
Predictably, many areas facing the greatest pressures from waiting lists and rising demand are among those least equipped with the digital capabilities that could help address them. Experience from both the NHS and overseas shows the benefits of technology investment typically emerge over three to five years.
That should serve as a warning to decision-makers. The technology choices made today will shape patient outcomes well into the future. Cutting transformation programmes to relieve short-term financial pressure may appear prudent, but it risks creating much higher costs later.
The challenge is also structural. For years, NHS technology programmes have been trapped in a cycle of feast and famine. Funding becomes available, projects accelerate, priorities shift, budgets tighten and programmes stall. Yet digital transformation requires sustained investment over many years. The funding model often operates according to political and spending-review cycles measured in months.
What is needed is not another round of pilot projects or innovation announcements. It is a stable, multi-year approach that enables organisations to invest with confidence, build capability and realise benefits over time.
The rise of artificial intelligence adds further urgency. While industries across the economy are rapidly developing AI capabilities, many NHS organisations remain at an early stage of adoption. Some still lack a coherent strategy.
AI will undoubtedly reshape healthcare. But success will depend not only on the technology itself but on governance, clinical oversight, workforce capability and leadership. Those foundations need to be built now.
The destination of healthcare reform is widely understood: more prevention, more community-based care, better use of data and greater productivity. Yet the evidence suggests too much technology spending remains focused on maintaining legacy systems rather than enabling that future.
Technology is no longer a support function operating in the background of healthcare. It is becoming one of the key determinants of whether the NHS can meet rising demand, improve outcomes and remain financially sustainable.
The question facing NHS leaders is not whether they can afford to invest differently. It is whether they can afford not to.
