 No hospitals did go bust, and only a minority of patients, mainly those needing elective surgery, were in a position to exercise choice between providers.Furthermore, as Arrow explained, “In practice, the theoretical advantages of choice are outweighed by the fact that people don’t do a good job of making these choices in a competitive environment—it’s almost impossible.”

In lieu of commercial failure, health and social care service regulators were established, first the Commission for Health Improvement, which was replaced by the Healthcare Commission and then the Care Quality Commission.Opponents of the internal market have regularly claimed that the introduction of the internal market increased NHS administration costs from 5% to 14% of total expenditure.