Tag Archives: NHS

Mirror, Mirror

Don McCanne brings us this post from the London Review of Books that describes in detail how the British NHS is being denationalized and privatized, in a mirror image of the push some Democrats are making about enacting Medicare for All.

Here in full is the article by John Furse. It is a cautionary tale for all those who support Medicare for All, and for those who want to keep the status quo, for-profit system here in the US. Remember that the NHS was endorsed by no less than Winston Churchill, by no means a flaming Socialist, and has been popular with the British people for seventy years. Can we say the same thing about our system?

London Review of Books

November 7, 2019
The NHS Dismantled
By John Furse

The Americanisation of the NHS is not something waiting for us in a post-Brexit future. It is already in full swing. Since 2017 Integrated Care Systems (ICSs) have been taking over the purchasing as well as the provision of NHS services in England, deciding who gets which services, which are free and which – as with the dentist and prescriptions – we have to pay for. Known in the US as Accountable Care Organisations (ACOs), ICSs are partnerships between hospitals, clinicians and private sector providers designed – and incentivised – to limit and reduce public healthcare costs, and in particular to lessen the demand on hospitals. Health Maintenance Organisations (HMOs), the forerunners of ACOs, were pioneered by the US health insurance provider Kaiser Permanente in 1953. President Nixon’s adviser John Ehrlichman explained to his boss the basic concept before the passage of the 1973 HMO Act: ‘The less care they give them the more money they make.’ In May 2016 Jeremy Hunt, then health minister, admitted at a Commons Health Committee hearing that Kaiser was a model for his planned NHS reforms. When a trial of ACOs was announced in the UK in 2017, it caused an outcry from campaigners and NHS England quickly rebranded them ICSs. But the Kaiser model isn’t new to healthcare policy in the UK: it has been the inspiration for the long and discreet process of the dismantling and reformation of the NHS since the 1980s.

In his report to the Conservative Party’s Economic Reconstruction Group in 1977, Nicholas Ridley wrote that “denationalisation should not be attempted by frontal attack but by preparation for return to the private sector by stealth. We should first pass legislation to destroy the public sector monopolies. We might also need to take power to sell assets. Secondly, we should fragment the industries as far as possible and set up the units as separate profit centres.”

After coming to power two years later, Thatcher was able openly to denationalise many industries, but the NHS, with its huge number of staff and institutions, its largely effective and equitable provision of healthcare and its great popularity, was a far more difficult proposition. In 1986 hospital cleaning services were privatised. In 1988 Oliver Letwin and John Redwood published Britain’s Biggest Enterprise: Ideas for Radical Reform of the NHS, which proposed turning the NHS into an independent trust and advocated joint ventures with the private sector and the introduction of fees.

The first major legislative step was the creation of the internal market. Kenneth Clarke’s 1990 NHS and Community Care Act split the NHS into ‘service purchasers’ and ‘service providers’: hospitals and GPs would compete for custom and the successful parties would be rewarded with greater funding. The influence of the HMO model and of the Kaiser consultant Alain Enthoven was acknowledged in Parliament by the then Tory MP Quentin Davies. ‘The fund-holding practice concept owes something to the system of HMOs in the United States … Elements of the Bill reflect some of the thinking of Professor Enthoven in his famous report and reflect his concept of an internal market.’ Enthoven was seen as an expert on ‘unsustainable growth’ in health expenditure and in 1985 his report ‘Reflections on the Management of the National Health Service’ had advised the Thatcher administration that ‘in competition doctors impose on themselves controls they would never dream of accepting if the government tried to impose them.’ ‘The system needed to be reconfigured,’ he later explained, ‘in such a way as to give incentives to motivate the self-interest.’

Letwin and Redwood’s ideas also had traction in Tony Blair’s 1997 National Health Service Act. Together, the 1990 and 1997 Acts turned NHS hospitals into trusts able to operate as commercial businesses. Many formed Private Finance Initiative partnerships to build and maintain hospitals – these deals, originally worth £11.4 billion, have lumbered the NHS with more than £80 billion of debt. Under New Labour a number of hospital trusts commissioned Kaiser and United Health, the largest US private health insurer, to run pilot programmes. ‘Consumer choice’ had been the mantra of the Thatcher era; under New Labour NHS patients became consumers and the goal ‘patient choice’.

These changes were minor compared to those introduced by the 2012 Health and Social Care Act (Letwin was by then a senior figure in Tory policy-making), which enabled hospital trusts to raise 49 per cent of their budgets from private patients and other sources, and to use NHS ‘brand loyalty’ to attract patients to their private services. In 2017 Swindon’s Great Western NHS Hospital advertised its private service saying: ‘Our patients benefit from a premium environment while having immediate access to specialist services often only available in large NHS hospitals.’

The Act gave more than 60 per cent of the NHS budget to local Clinical Commissioning Groups (CCGs), comprised of GPs and other clinicians, to be used to commission services from the private sector as well as from the NHS. Writing anonymously, one GP described the change as ‘how to get turkeys not only voting for Christmas but also plucking, basting and putting themselves in the oven’. Given their lack of business expertise, CCGs were provided with Commissioning Support Units run by private companies including KPMG, Price Waterhouse Cooper, McKinsey and Optum, the UK subsidiary of United Health. In practice, these companies now run the franchising of NHS services.

A key part of the 2012 Act, to which McKinsey was a significant contributor, was the abolition of the health minister’s responsibility for national healthcare provision. This was left to NHS England under its new director, Simon Stevens, a former health policy adviser to the Blair government appointed by David Cameron because ‘he knows more about NHS problems and market solutions than any man alive.’ In his previous role as a CEO of United Health, Stevens had led corporate opposition to the introduction of Obamacare. His ‘Five-Year Forward View’, launched in 2015, became the basis for NHS England’s Sustainability and Transformation Plans (STPs), drawn up with Optum and McKinsey. The STPs were supposed to create savings of almost £5 billion a year by 2020. As in the Kaiser model, costs are cut by reducing access to care. (Meanwhile, the revolving door continued to turn: senior government and NHS England figures who took prominent positions at Optum include Cameron’s health adviser Nick Seddon, NHS England’s commissioner David Sharp and its mental health director Martin McShane.)

The STPs divided England into 44 CCG-run ‘footprint’ areas, all of which were put under pressure to amalgamate hospitals and shrink specialist units. Hospital beds have been progressively cut: the UK’s bed-to-patient ratio is now one of the lowest in any developed country. Accident and emergency departments, which not only require expensive equipment and high numbers of staff but also take the brunt of social care failings, are in the process of being cut from 144 to about fifty. GP care is increasingly provided by ‘physician associates’, nurse practitioners and pharmacists, while patients are exhorted to use privately owned, profit-making online and app consultancies such as Doctaly, GP at Hand and myGP. Opening up new markets for US tech giants is a key factor in the reconfiguration of the NHS.

Enforced centralisation has resulted in ‘hub’ hospitals and fewer, larger GP practices: at least a thousand have closed since 2014 and the number with more than twenty thousand patients has tripled. With funding incentives from NHS England, GPs are merging their practices into competing, largescale organisations with names like Primary Care Networks and Super-Practices, or becoming partners in commercially driven Multi-Speciality Community Provider centres. These reduced and restructured services are open to takeovers by private companies. NHS hospitals now lease space on their own premises to private companies. Guy’s Hospital, in the absence of the funding it needed to develop adequate cancer facilities, rented space to the Hospital Corporation of America for private cancer suites that were given access to the hospital’s facilities. The merging of public and private provision in the same space usefully blurs the distinction between them. And the rationing of non-urgent operations such as hip replacements and restrictions on follow-up therapies – as well as increased waiting times – encourage patients to seek private treatment.

A recent report by the Strategy Unit, an NHS consultancy, acknowledges that ICSs are designed to ‘moderate’ demand and reduce spending, while their partners keep the savings they make if they run below budget. It cautions that, as with ACOs, there is ‘only limited assurance that providers will not game the system and that quality will not suffer … large financial rewards may flow out of the NHS.’ At the 2012 World Economic Forum, Stevens (then working for United Health) led proposals to replace public healthcare systems around the world with accountable care systems. His collaborators included Medtronic, the world’s largest producer of medical devices (a US company based in Ireland for tax purposes), Qualcomm Life, which designs medical technology, and Kaiser. Since his arrival at NHS England, the influence of such companies has grown: IBM is now a lead supplier of IT; Optum runs GP referrals services and is in a partnership with the second largest GP federation, Modality. The UK’s largest GP network, the Practice Group, is owned by the American company Centene. Similar companies, such as the Priory Group, are major players in mental healthcare provision and are involved in mental health ICSs.

Private companies, with their increased overheads, higher rates of borrowing and shareholder dividends, are inherently more costly to the public than state-funded services. Less obvious are the high costs of management and administration involved in franchising and marketing services. In the US these are estimated to account for more than 30 per cent of the $3.6 trillion spent on healthcare. A 2010 report commissioned by the Department of Health estimated management and administration costs at 14 per cent of total NHS spending, more than twice the figure in 1990. Commercial confidentiality laws and opaque NHS accounting make the costs of privatisation hard to quantify but privatisation is probably adding at least £9 billion a year to the NHS budget.

Stevens was recently praised by politicians and the media when he called for the repeal of Section 75 of the 2012 Health and Social Care Act, which requires competitive market tendering for the provision of services – ostensibly a move away from privatisation. But the real reason lies in the small print. Section 75 subjects private contractors to the Competition and Markets Authority. Its repeal will deregulate the sector and make ICSs more attractive to companies. Andrew Taylor, the founding director of the Co-operation and Competition Panel for NHS Funded Services, told a Commons committee hearing in May: ‘I don’t think anyone’s realistically talking about removing the private sector from the NHS. What the proposals do in effect is deregulate NHS markets. They don’t actually remove markets from the NHS.’

The Ridley Report’s proposals for denationalisation are being hurried to fulfilment. NHS property and land assets worth £10 billion are being sold to private developers. The fragmentation of a once fully integrated service into competing and commercially-driven units is well advanced and has been accomplished without proper public scrutiny, knowledge, consent or appropriate Parliamentary legislation. Successive governments have been assisted by the failure of the media to recognise the overall shape of the project and sufficiently analyse the disparate changes. ICSs will be fully up and running throughout England within 18 months.

Health Care Is Not a Market

For the next twenty-one months, there will be a national debate carried on during the presidential campaign regarding the direction this country will take about providing health care to all Americans.

However, to anyone who reads the articles, posts and comments on the social media site, LinkedIn, that debate is already occurring, and most of it is one-sided against Medicare for All/Single Payer. The individuals conducting this debate are for the most part in the health care field, as either physicians, pharmaceutical industry employees, hospital systems executives, insurance company executives, and so on.

We also find employee benefits specialists and other consultants to the health care industry, plus many academics in the health care space, and many general business people commenting, parroting the talking points from right-wing media.

That is why I re-posted articles from my fellow blogger, Joe Paduda last week and yesterday,  who is infinitely more knowledgeable than I am on the subject, and has far more experience in the health care field, that not only predicts Medicare for All (or what he would like to see, Medicaid for All), but has vigorously defended it and explained it to those who have misconceptions.

For that, I am grateful, and will continue to acknowledge his work on my blog. But what has caused me to write this article is the fact that most of the criticism of Medicare for All/Single Payer is because those individuals who are posting or commenting, are defending their turf.

I get that. They get paid to do that, or they depend on the current system to pay their salaries, so naturally they are against anything that would harm that relationship.

But what really gets me is that they are deciding that they have the right to tell the rest of us that we must continue to experience this broken, complex and complicated system just so that they can make money. And that they have a right to prevent us from getting lower cost health care that provides better outcomes and does not leave millions under-insured or uninsured.

However, not all these individuals are doing this because of their jobs. Some are doing so because they are wedded to an economic and political ideology based on the free market as the answer to every social issue, including health care. They argue that if we only had a true free market, competitive health care system, the costs would come down.

But as we have seen with the rise in prices for many medications such as insulin and other life-saving drugs, the free market companies have jacked up the prices simply because they can, and because lobbyists for the pharmaceutical industry have forced Congress to pass a law forbidding the government from negotiating prices, as other nation’s governments do.

Yet, no other Western country has such a system, nor are they copying ours as it exists today. On the contrary, they have universal health care for their citizens, and by all measures, their systems are cheaper to run, and have better outcomes.

None of these countries can be considered “Socialist” countries, and even the most anti-Socialist, anti-Communist British Prime Minister, Winston Churchill said the following, “Our policy is to create a national health service in order to ensure that everybody in the country irrespective of means, age, sex or occupation shall have equal opportunities to benefit from the best and most up-to-date medical and allied services available.”

Notice that Sir Winston did not say, free market competition. He knew that competition is fine for selling automobiles, clothing, food, and other goods and services. But not health care.

He also said that you can always count on Americans to do the right thing, after they have tried everything else. We’ve tried the free market in health care, and drug prices and other medical prices are through the roof.

However, another thing they have not done, and I believe none of the other OECD countries have done about health care, is to divide the “market” into silos such as the elderly with Medicare, the poor with Medicaid, children with CHIP, veterans with the VA, and their families with Tricare, etc.

No, they pay for all their citizens from a global budget, and do not distinguish between age level, income level, or service in the armed forces.

And their systems do not restrict what medical care their people receive, so that no only do they have medical care, but dental care, vision care, and hearing care. It is comprehensive. And if they have the money to pay for it, they can purchase private health insurance for everything else.

In the run-up to the debate and vote in the UK on Brexit, the point was raised that while Britain was a member of the EU, their retirees who went to Spain to retire, never had to buy insurance because the Spanish providers would bill the NHS.

However, once Britain leaves the EU, they will have to buy insurance privately, because the NHS won’t pay for it. But not all retirees can afford private insurance, so many British citizens will have a problem.

As I have mentioned before in this blog, I was diagnosed with ESRD, and am paying $400 every three months for Medicare Part B. I was doing so while spending down money I received after my mother passed away in 2017. My brother and I sold her assets and used that money to purchase property so that she could go on Medicaid, and eventually into a nursing home when the time came for her to be cared for around the clock.

Since my diagnosis, and prior, I was not working, so spending $400 every three months, and paying for many of my meds, has been difficult. I am getting help with some of the meds, and one is free because my local supermarket chain, Publix gives it for free (Amlodipine).

I hope to be on Medicaid soon, but would much rather see me and my fellow Americans get Medicare for All, and not have to pay so much for it. (a side note: we have seen that Medicaid expansion has been haphazard, or reversed, even when the government is paying 90% of it)

So why are we not doing what everyone else does? For one thing, greed. Drug companies led by individuals like Martin Shkreli, who is now enjoying the hospitality of the federal government, and others are not evil, they are following the dictates of the free market that many are advocating we need. No thanks.

For another, Wall Street has sold the health care sector as another profit center that creates a huge return on investment by investors and shareholders in these companies and hospital systems. Consolidation in health care is no different than if two non-health care companies merge, or one company buys another for a strategic advantage in the marketplace.

There’s that word again: market. We already have a free market health care system, that is why is it broken. What we need is finance health care by the government and leave the providing of health care private. That’s what most other countries do.

So those of you standing in the way of Medicare for All/Single Payer, be advised. We are not going to let you deny us what is a right and not a privilege. We will not let you deny us what every other major Western country gives its people: universal, single payer health care.

Your time is nearly up.

Hospital Mergers Improve Health? Evidence Shows the Opposite – The New York Times

Yesterday’s post, Hospital lobby ramps up ‘Medicare for all’ opposition | Healthcare Dive, suggested that moving towards an improved and expanded Medicare for All system would force hospitals to close, so the article below in today’s New York Times would seem to argue that the urge to merge does not improve health.

So on the one hand, if we adopt a democratic socialist approach to health care, hospitals may close; yet, if we allow them to follow capitalist economic laws regarding economies of scale, they don’t offer better care.

Perhaps, then it is better to try the democratic socialist approach, because the economies of scale approach has not worked, and let’s see if hospitals do close, or they see an increase in patients due to more people being covered.

ACO’s Across the Pond: What Some Believe the US and England Can Learn From Each Other

It is amazing how experts in the field of health care are so wedded to ideas that are, with greater scrutiny, the real cause of the dysfunction and failures of providing health care to the citizens of a nation.

Such is the case with an article I found from the Commonwealth Fund, a well-respected organization in health care research, yet doubles down on the root causes of the crisis faced by the health care system in the US.

Late last month, Briggs, Alderwick, Shortell, and Fisher published the article entitled, “What Can the U.S. and England Learn from Each Other’s Health Care Reforms?

The focus of the article was on the idea of Affordable Care Organizations (ACO’s), which in the US were established in 2010 under the ACA. According to the authors, both countries are currently working toward better integrating health services, improving population health, and managing health care costs. They also said that both countries are developing their own versions of ACO’s to achieve these aims.

However, the authors point out, by way of listing previous links to articles they wrote, that results so far have been mixed, patient experience (you mean like having a great time at Disney World, that sort of experience?) and some quality measures have improved.

Yet, financial savings, they report, have been modest and data on outcomes is limited.

On the other hand, across the pond, the English NHS recently created 44 Sustainability and Transformation Partnerships (STPs) [Isn’t that what one puts in a motor car to make it run better?]

These STPs cover the entire country and are “place-based” partnerships of all NHS organizations and local government departments that purchase and provide health and long-term care services for a geographically defined population. They believe that organizations in STPs will work together to improve care and manage local budgets. Some payers are even considering American-style ACO contracting models.

Wait, if we are not having success with ACOs, what makes the Brits think they will do better? Interestingly enough, Himmelstein and Woolhandler, in “Health Care Under the Knife”, chapter 4, page 61, said the following when they were involved with drafting an new proposal for the Physicians for a National Health Program (PNHP):

“Recently, the emergence of huge integrated health systems incorporating multiple hospitals and thousands of physicians (so-called Accountable Care Organizations or ACOs), which dominate the care of entire regions, is causing us to again to talk about NHS models.”

So let me get this straight. We are not having much success with ACOs, yet, the Brits are moving in that direction. And the physician-led advocacy group in this country, the PNHP, that is pushing for single-payer, has been forced to consider models employed by the British NHS.

If that isn’t the definition of insanity, I don’t know what is.

Of course, the move towards ACOs in this country is due to the ACA and to the resurgence of 19th century economic liberalism, also known as neoliberalism, and its impact over the past thirty years on the American health care system. But in the UK, the move away from Labour Party socialism to the Conservative Party’s neoliberalism, is the reason why Britain is exploring the ACO model.

Maybe one day, both Anglo-oriented nations will wake up and stop believing in the fairy tale that the free market works for health care. It does for cars and other consumer goods, but health care is not a consumer good. It is a necessity of life.