The NHS business model focuses on treating sickness, not ensuring wellness. This paper focuses on diabetes, as a long-term condition with significant associated health risks, to show how health policy is failing in this area. Evidence shows that self-care isn’t working and hospital admissions are increasing for patients with diabetes. It finds that there is no incentive mechanism in the NHS to improve medicines compliance; no financial rewards for actively reducing the number of hospital admissions for people with long-term conditions; or for ensuring that people at risk do not go on to develop diabetes and its complications. Overall, the business models in the NHS have not been designed to treat patients with long-term conditions. The resources, processes and financial incentives of GP practices and hospitals were designed to manage acute events, not prolonged periods of care. This report concludes by arguing that new business models need to be developed in the NHS so that new technologies and ways of working can improve care for patients with long-term conditions.