|
|
|
Pain relief or hallucinogen? The NHS after the budget By Colin Leys Massive extra funding for the NHS - £40 billion - over the next 6 years, until UK health spending matches that of our EU partners: could anything be more welcome? It's so long overdue, and so essential. The Tories who declare that the NHS can't be "saved" by "pouring money into it" are upset precisely because the new money ends the financial starvation they have counted on to discredit the NHS and make possible a return to private health care. But if we really want to see the NHS survive and prosper we must be realistic. £42 billion over 6 years is not so large in relation to the NHS's existing cost of £65 billion a year. Needs and expectations, and the cost of drugs and technology, are constantly increasing, and many NHS staff are paid considerably less than their EU counterparts. The promised improvements can't be achieved by hiring more and more nurses while keeping their salaries as low as they now are, whatever Alan Milburn says in his efforts to dampen their hopes. There is also a backlog of hospital maintenance and repairs totalling £3.2 billion, and hospital trusts have accumulated debts of £1.5 billion. How much of the promised extra £40 billion will have to go to plugging these holes before a single improvement can be made we have not been told, but it is bound to be a significant part. The spin is that in five years time we shall be spending as much on the NHS, proportionately, as the Germans or the Swedes. But to catch up with them we would need to spend much more than them, and over many years. This is not going to happen. And after so much neglect and demoralisation, and given the time it takes to train health care workers and build new facilities, change will only show through incrementally. As all the commentators have said, Brown and Blair are "gambling" that enough improvement will be felt before the next election to win it for them. Their electoral gamble may succeed. But they are also gambling with our health care system. Because there is also the question of the direction of change that the new money will be paying for. With the Tory health spokesman Dr Liam Fox calling on the party faithful to do all they can to undermine public confidence in the NHS it is easy to imagine that Labour's stewardship must be all right. But Labour's policies are converging more closely with the Tories' than most people realise. We can see this by comparing two recent documents: the Adam Smith Institute's pamphlet, NHS Reform: towards consensus?, published a few days before the budget, and New Labour's white paper, Delivering the NHS Plan published just after it. The Adam Smith pamphlet - co-authored by Matthew Young and Anthony Browne, the Observer's health correspondent - is Conservative Party propaganda masquerading as expert opinion. It declares that "the NHS is in crisis" and attacks it as a "politically controlled state monopoly", "almost identical to the old health services in the former communist countries of Eastern Europe", with "fewer doctors per head of population than any European country apart from Albania", "more bureaucrats than beds", etc. The authors' solution is to oblige everyone to insure for their own health care through what they call "social insurance" companies - although what would be "social" about them is not spelled out. While they would be "non- profit", they would compete with each other, and also seek to drive down health provider prices, as private medical insurance companies do now. The government would pay the insurance premiums for "the poor", but everyone else would pay their own, and be free to pay higher premiums for "extras". The premiums would also be collected by a special division of the Inland Revenue, "for administrative simplicity". It would take too long to spell out all the contradictions in this proposal. The key point is that it envisages a "fee-for-service" system, with doctors setting the fees, as in the USA, which notoriously leads to over-treatment; "co-payments" by patients for treatments received, in addition to the payments covered by the insurance companies (and evidently quite large payments, since the pamphlet sees the need to put an annual ceiling on them for the "catastrophically ill"); and insurance companies offering patients "deals" on their premiums in return for accepting treatment by "preferred providers" - i.e. at hospitals and from doctors (NHS or private) with whom the company has also done deals. Premiums will be related to income, but everyone will supposedly get the same level of service: the poor will "have access to the same hospitals and doctors as the rich." Yet those who want to be treated by a particular surgeon who is in high demand, for example, will be able to do so by paying extra premiums and/or extra fees for the service. So "access" will not be the same after all. The "extras" turn out to be just better treatment for the rich. Everyone will be obliged to join an insurance company, and be free to choose which one, but insurance companies will not, apparently, be obliged to accept anyone who wants to join. Experience elsewhere tell us what this means: the elderly and the chronically ill, with their high healthcare costs, will find themselves (unless they are rich enough to pay higher premiums) "choosing" at best some government- subsidised insurer of last resort, offering the usual bare minimum package of care. Behind the Adam Smith proposal lie the German or Dutch models of social insurance schemes inherited from the Bismarckian state. Not only has that model turned out to be full of problems of equity, once funding became less lavish, it has also turned out to be extremely costly in terms of administration. And no comparable institutions exist in Britain. It takes no great acumen to see that what the authors envisage here are non-profit "affiliates" of the existing insurance companies, which alone have the necessary expertise to set them up, and which will charge substantial fees for "advising" them. Their costs will be huge, and the resulting search for economies will swiftly push them in the direction of the Health Maintenance Organisations or HMOs - the widely detested, cost-cutting arbiters of just how much treatment you will get in the USA (if you are insured at all). It is interesting that the Observer's health correspondent has come out as a propagandist for the insurance industry, helping to prepare the ground for a hoped- for shift to private medicine on these lines when the Conservatives eventually return to power (amidst predictable charges that "nothing has changed" in the NHS after so many "more years of tax and spend"). But the real interest of the Adam Smith pamphlet is that its core idea, HMO-style insurance companies funded out of taxation (the premiums collected by the Inland Revenue), is actually not all that different from what New Labour policy is already producing. Because the core idea of Milburn's white paper, Delivering the NHS Plan, is the new system of some 470 Primary Care Trusts or PCTs, controlled mainly by GPs, each responsible for about 100,000 patients. They will be entrusted with over 75 per cent of the NHS budget, covering all primary and secondary (hospital) care, and be free to purchase it from private as well as NHS hospitals, and do whatever deals they like with private as well as public providers of other health services of all kinds. Like HMOs, they will have a financial incentive to ration spending on expensive patients, whether for costly drugs or surgery or personal care for the long-term disabled. And since their "risk pools" will be quite small they will be highly vulnerable to the costs of treating patients who need prolonged and expensive treatment, and anxious to limit them. Like HMOs, too, they will be free to undertake commercial activities. Many will have financial stakes in joint ventures with the private sector in building and operating surgeries, clinics, walk-in centres, pharmacies, home-call and other services. Their transaction costs will be high. None of them will be democratically accountable (although they will be subject to New Labour's cure-all - inspections and audits from the centre). In fact in relation to hospital care the chief difference between New Labour's PCTs, and the Adam Smith Institute's "social insurers", apart from the latter's fee-for service and co-payments aspect, is that the New Labour model provides a much smaller role for the insurance industry. Perhaps the insurers' disappointment will be offset by the good will of the banks, facilities management and construction companies involved in the new PFI hospital projects promised in the Plan when it comes to soliciting party funds for the next election. Also in the name of "devolution", the remaining planning capacity of the NHS is to be dismantled and replaced by a vaguely-described, and in part privately-run, system of monitoring and accounting. The Department of Health will be "slimmed down" and in place of the existing health authorities (already in many cases too large to be sensitive to local needs and sentiments) there will now be just 28 "strategic health authorities", run on three-year "franchises" by private companies or management teams, with a mandate only to "hold to account the local health service, build capacity and support performance improvement". Predictably, because of the excitement over the budget, the future envisaged in Delivering the NHS Plan has not received the attention it deserves. The new structures are taking shape at breakneck speed. The distinction between the NHS and the private healthcare industry is being rapidly erased. In the name of "devolution" and "choice", unaccountable local bodies will soon be spending the tax revenues earmarked for health care on a mix of public and private health services, with little or no planning, increasingly legitimised rationing, and no assurance of equity between wealthy and poor areas or the individuals within them. Bevan's great principles of universal comprehensive health services, equally available to all regardless of ability to pay, are no longer central to New Labour's thinking. What seems central is New Labour's commitment to the WTO agenda of opening up public services to market forces, which these changes clearly facilitate. Colin Leys is the author of Market-Driven Politics (Verso, £16). This is a revised version of an article that appears in the June issue
of Red Pepper. |
 |
From time to time Catalyst will post research or papers
from other organisations which are particularly relevant or complementary
to our work. If you have any suggestions please contact
us.
|
