Friday, 21 August 2009

Politicians in Denial

21st August 2009

The Malta Independent - Friday Wisdom

Healthcare is back in headlines. As the global financial crisis loses its power to surprise and the financial confusion and economic softness become a state of normality, healthcare is dominating the news.

In the USA healthcare reform was President Obama’s key campaign pledge and there is no surprise that he is showing a sense of urgency in delivering the reform as early as possible in his mandate. He knows this is an issue which would ruffle the feathers of the many who have vested interest in the status quo; a situation where millions of US workers and their dependants are living without health insurance and without the comfort of free or subsidised public health care service as we are used to in ‘socialist’ Europe.

President Obama is experiencing a live confirmation of Macchiavelli’s advice to The Prince that “there is nothing more difficult, more powerless to conduct, or more uncertain in its success than to take the lead in the introduction of a new order of things because the innovators have for enemies all those who would have done well under the old system and lukewarm defenders from those who might do well under the new system.”

The Republicans know that if they block Obama on the healthcare reform, they can render him a lame duck for the rest of his term. Added to the problems of sorting out an inherited financial mess of gargantuan proportions, this would give the Republicans a fair chance of turning Obama into another Jimmy Carter. For the Republicans it is relatively easy to whip up public sentiment against the reform, even from those who voted Obama into his presidency, if they convincingly argue that creating a public health care system which offers cover to the uninsured will involve raising taxes on those who are already insured or force on them reduced benefits as private insurers will have to compete with publicly subsidised competition.

In the UK we had a Conservative spokesman, speaking in support of the Republican campaign against Obama’s healthcare reform plan, who described the British NHS as a disgrace which he would not wish on his worst enemies. He urged Americans to obstruct Obama’s plan to create an American sort of NHS.

This was quickly picked up by UK Labour Prime Minister Gordon Brown, who faces an election in less than nine months, warning the British public that a Conservative government in waiting would dismantle the NHS. UK Conservative Leader of the Opposition David Cameron was quick to distance his party from the comments from one he described as an eccentric outlier, and re-affirmed that a Conservative government would not only defend the NHS but would ameliorate it and strengthen its benefits.

In Malta we have a strange situation. Our politicians are the only ones who overtly profess that our health service, with its universally free entitlement benefits, is sustainable for the long term. Any suggestion coming from economists, central bank, international rating agencies, civil society, political observers as well as retired politicians is politely pooh-poohed. This week we had Dr J. Psaila Savona, a former PN Parliamentary Secretary, publicly arguing that our health system in its present format is unsustainable.

Could it be that our politicians are right and all the rest are wrong? Could it be that while the strongest country in the world is struggling to offer some sort of cover to many who are excluded, and the contributions for those that have cover average about USD12,000 per annum (of which two-thirds are funded by employers), we in tiny Malta are so clever that we can keep a cutting edge health service as a universal social entitlement?

Could it be that in Switzerland, the State only subsidises the health insurance premium of those who are in poor social conditions that cannot afford to pay it and that all health service are then rendered commercially at a charge to the insurance company who normally imposes stiff annual excess limits on the insured (similar to the excess on the motor insurance), and that we in Malta have discovered a formula which has escaped everyone else?

Most unlikely I would say! It is more likely that Maltese politicians read Macchiavelli more attentively and therefore prefer to do what’s popular rather than what’s right.

Someone must however explain that this artificial story cannot have a happy ending. We can pretend for some time but not forever. Reality finally catches up.

Unless we reinvent our health system, one, or a mix, of three things could happen. The government may have to raise taxes to spread the cost of ‘free’ services on the generality of taxpayers. Or government could finance the spiralling cost of free health care, as the population ages and medical intervention would be more like expensive heart surgery rather than run of the mill appendicitis, by running higher budget deficits. Or government will leave everything as is but ration the service rendering it nominally free but practically inaccessible because of long waiting lists, overcrowded wards, and similar deterioration in delivery of health services forcing many to seek private healthcare services.

Raising taxes is unpopular and governments will resist it as hard as imposing fees on health services. Running higher deficits runs foul of our Euro obligations. So by default we will see unofficial rationing of health services. Indeed we are already experiencing it with the roll-back of primary services at regional health centres, long queues at Emergency Dept., and years’ long waiting list for non life threatening surgery.

By default our health service will go down the same route as pour pension system which remains universally applicable but inadequate for most. Just as most have to save separately for addressing inadequate public pensions, most already have or will soon have to take out private health insurance to protect their families from the inevitable rationing of public health services.

And our politicians will continue to crow that they honoured the pledge of keeping public health service universally free. And most of us will continue to smile wryly at our politicians in denial.

No comments:

Post a Comment