It’s Not Too Late

Article published on Dec. 22, 2003
community published
Article published on Dec. 22, 2003

This article has not been vetted by an editor at Paris HQ

Globalisation hasn’t reached Europe’s health care services, at least as far as their structuring and evolution are concerned. In the EU, there are two basic models, organised and managed differently but both in crisis: Social Security and the National Health Service.

Social Security is a system financed by social contributions, with a mixed provision of services by both public and private bodies. It uses a system of co-payment (that restricts excessive use thereby eliminating the problem of abuse). France spends more on health care than any other European country and it uses this system.

The National Health Service was established in Great Britain in 1948 and inspired the Scandinavian countries, Ireland and southern Europe (Italy and Spain). It is a single system that is public, universal and with all its facilities under the same hospital roof. This model is considered the cheapest (one per cent less of the GDP), fairer and more efficient.

The universalisation of problems

The structures may not be universal, but it seems that the problems are. The increase in Europe’s health spending is a result of the ageing population, the lack of preventative measures (the prevention of smoking, a sedentary lifestyle and dietary excess), the cost of health care services which in the EU has risen above the consumer prices index, hospitals’ investment in sophisticated technology, and the development of degenerative diseases and illness associated with old age. Moreover, as Aldous Huxley once said, medical research has advanced so far that it is ever more difficult to find someone who is completely healthy. The increase in the number of health care staff needed to attend to this growing percentage of people dependent on health care is yet another substantial expense.

In the European Union the health system is entering into a new phase that could threaten the achievements of the Welfare State. The most extreme example of this is the health reform in Germany, backed by all its political parties, which will mean fewer benefits, limitations on certain drugs and higher contributions.

Ana Rico of the European Observatory on Health Care Systems believes that the reunification of Germany could be one of the causes of the financial crisis of the German system, ‘but another hypothesis is that market policies cost a lot if they aren’t managed effectively. The theoretical hope that money would be saved hasn’t become a reality in those places where they have been put into practice’. The first phase has in fact seen an increase in expenditure. These changes in the German health system should serve as a warning to other EU countries of what happens when health spending is left to spiral out of control for too long, a situation that has forced autonomies within Spain such as the Canary Islands and Galicia, to turn to extra-budgetary funds.

In France, a report from the Commission for Social Affairs of the Senate published in June concluded that the structural weaknesses in medical assistance were extremely worrying and proposed ‘serious reform of the public health system to avoid too great a rise in general taxes’, intended to restore the financial equilibrium of the social security system. According to the report, ‘it is not viable that public health spending continue increasing at a rate of six or seven per cent per annum’, since new taxes and contributions would be called for. Then came the heat wave that led to the collapse of the French health system.

The Health Minister, Jean-François Mattei, presented the Hospital Plan 2007, that will be implemented in the next five years and that requires an investment of 10,200 million Euros in the hospitals and emergency services.

Public management, thank you very much

But greater spending doesn’t guarantee better cover or better services. Take the example of the United States, the country that spends most on health, 14% of the GDP (the European average is just over 8%). Of this money, 20% goes on bureaucracy (just to compare: in Spain the figure is a little over 3%). Public spending represents a mere 40% of total health spending in the States. The disastrous consequences are clear: the number of Americans not provided for by the health system rose by 2.4 million in 2002 as a result of higher unemployment and now stands at 43.6 million, according to a report announced in September by the American Census Office.

And so, guaranteeing high-quality universal public health care takes more than just the provision of more public funds: management and administration must also be public, aimed at improving public health and at market competition. In Spain, the ruling Popular Party has formed Foundations (trusts) charged with managing public health. The State emerges as little more than a business enterprise, disregarding the controls put in place to protect the general interest in the administration of public funds. A further consequence of the adoption of private law in the health care services is the ensuing instability and the hiring and firing more familiar to other business sectors. The route taken by Spain represents one of the tendencies in Europe’s health services. In order to avoid the ways of business infringing on our health services, that is to achieve a fair and sustainable health system in the EU, we need good public management. It doesn’t sound that hard, does it?