HPU
SA should avoid Britain’s public health mistakes
Author: Philip Stevens and Eustace DavieDate: 23 May 2008
THIS week, the government puts before Parliament two bills it hopes will improve access to healthcare among the poorest. The bills give wide-ranging powers to the health minister not only to set prices for every health-related product sold in SA, but also to decide which products can be sold at all. This follows the government’s existing fierce restrictions on new private hospitals, which are limited in where they can be built, in what quantity, and what equipment they can use.

 As well as driving up prices, these policies make it difficult for private clinics, hospitals and pharmacies to stay in business. Many will inevitably close. But this is part of the government’s plan to entrench its healthcare system as the sole provider of care, to provide “universal” access to poor South Africans.

 While Health Minister Manto Tshabalala-Msimang may have ideological reasons for destroying the private sector, she has not demonstrated that a state monopoly can provide quality healthcare to the poor. Certainly, the parlous condition of state hospitals does not augur well for the future of SA’s healthcare if the private sector vanishes. And even in wealthy countries, such as Britain, state care fails the poor.

 Britain has had a taxpayer-funded “universal” health system since 1946, and is the only major country in Europe to have one. This National Health Service (NHS) is also one of the worst-performing health- care systems in the developed world, a fact that should alarm South Africans.

 Research shows British cancer patients are less likely to survive five years after diagnosis than anywhere in Europe. British stroke patients suffer the worst outcomes among peer countries, despite costing as much. In 2005, the Nuffield Trust reported that mortality from heart disease in the UK was worse than in every comparable European country.

 This is unsurprising when one considers how poorly the NHS employs new medical technologies. According to Sweden’s Karolinska Institute, Britain is below average for the uptake of innovative oncology drugs. Such drugs reduce both the amount of time patients need to spend in hospital and their chance of dying. Rates of use of other new drugs and technologies such as CT scanners are also far below those of peer countries.

 This is pertinent to SA. Healthcare systems that are solely tax-financed and are free at the point of use inevitably face the twin pressures of uncontrollable demand from patients, and the government’s need to control costs. Britain has attempted to square this circle by creating a body called the National Institute of Clinical Excellence (Nice), which determines which drugs can be procured by the public health system. The South African government has proposed a similar body in its Medicines and Related Substances Amendment Bill.

 Nice calculates the cost and benefits of each new drug to decide if it is a suitable use of the NHS’s fixed pool of cash, thereby ostensibly providing an economic and clinical basis to the NHS’s formulary. In reality, Nice gives economic and clinical justification for rationing.

 Over recent years, dozens of innovative and life-extending drugs that are readily available in other countries have been denied to British patients — giving rise to the undignified spectacle of dying patients campaigning outside parliament.

 These campaigners have a point: after all, why should a bureaucrat have the power to put a value on their life? And this principle is about to be exported to SA.

 The government is basing its attack on the private sector on the notion that it removes resources from the public sector, and thereby contributes to inequality. But Britain’s experience also shows this to be a fallacy. In 2003, Tony Blair said the NHS was a “deeply unequal" system — the poorest received the worst healthcare. The data indeed show poorer patients to be more likely to die of cancer and heart attacks, partly because the well-educated middle classes can better navigate the NHS’s bureaucracy, or opt for the private sector.

 The UK is one of the most prosperous countries in Europe, yet its NHS has proved incapable of providing universal high- quality healthcare. In fairness, the British government has recognised the shortcomings of state monopoly provision, and has started to commission the private sector, including South African companies, to perform operations for NHS patients. The resulting competition has driven down costs and reduced waiting times.

 Instead of destroying the private sector, the government should learn from Britain’s dismal experience with socialised medicine. SA has a world-class private sector. The government’s mission should be to make this sector more accessible to the poor, be it via contracting, vouchers or social insurance. As Britain shows, monopolies kill. SA should not repeat its mistakes.

 Stevens is director of policy at International Policy Network, a British think-tank, and Eustace Davie is the director of the Health Policy Unit, a division of the Free Market Foundation.

 

First published - Business Day / 19 May 2008

 

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