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Health Minister James Reilly has promised that free GP care will be extended to the entire public from 2015 and universal health insurance by 2016. Figures recently released show that the numbers of people with private health insurance fell by 64,000 in 2012. So what is the future of our health service and how do insurance companies fit in?
MAJOR CHANGES ARE coming down the tracks for the Irish health system under the Government’s health reform proposals. Two of the main features of the plans are the introduction of free-at-the-point-of-use GP care for all by 2015 and universal health insurance in 2016.
The first of these would be a positive development, as over half the population currently has to pay significant out-of-pocket charges to see a GP (typically around €50 per visit) and this puts many off seeking care until their illness has progressed to the point where they need hospitalisation (a more expensive care setting). Removing this financial barrier to accessing a GP should therefore lead to long-term savings for the system, although the cost of providing this has been estimated at €389 million per annum.
Universal health insurance will rely heavily on the introduction – or enhancement – of competition, both between providers and between purchasers of care. The plans envisage hospitals competing against each other to offer value to insurers (purchasers), and insurers competing against each other to offer value to consumers (some of whom will be patients but others of whom might not need to access services)
There are many reasons why competition in the healthcare sector will not work in the same way as it does in markets for other goods and services. Firstly, demand for healthcare is a derived demand – what people actually demand is good health, but in some cases they will need healthcare to meet that demand. Secondly, demand for healthcare is uncertain for most people, as they don’t know when they will need it (unless they have a chronic condition, in which case they might be better able to predict their needs).
Thirdly and perhaps most importantly, there are information mismatches between consumers and purchasers, between purchasers and providers and between providers and patients (for example, if a doctor prescribes a particular course of treatment, most people would not have the expert knowledge to disagree, whereas the same lack of knowledge is not evident when people go to buy milk or bread). These information mismatches can lead to market failures, as a result of which, any competitive market for healthcare or health insurance would need to be very tightly regulated.
Information on both costs and outcomes will be crucial for the benefits of competition to accrue, as will transparency of that information for both payers (insurers) and patients. This will require investment in information systems and will need skilled people to analyse the data.
The reorganisation of public hospitals into hospital groups will, to an extent, create dominant regional providers, and in these circumstances it will be interesting to see how – and for what – private hospitals will compete. Competition between health insurers in Ireland in the last two decades has not led to a reduction in premiums – nor even a reduction in premium inflation – so the reliance on competition to keep costs down may be a leap of faith. Evidence from the Dutch system, on which Fine Gael modelled many of its pre-election proposals, shows a significant increase in costs after implementing a similar type of reform. This raises concerns about affordability of universal health insurance, both at an individual level and a system-wide level.
It’s time to have a national debate about the type of health system we want, and how much we are willing to pay for it, with inputs from all of the main stakeholders (providers, payers and, most importantly, patients). This would give the current and future Ministers for Health a clear mandate in terms of the system’s design.
Brian Turner is lectures on health economics, insurance economics and general economics at University College Cork.
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I am so sorry to disappoint everyone but there is no health system which is free…it will be the taxpayers money which will pay the GP doctors and nurses for the work they will be doing and that is why we should be calling things the right way…I doubt that all professionals which provide GP care will do the work for free, thus someone has to pay them and it will be the working class again…I know lots of people who are on social welfare and have lots of privileges including not paying the GP, and I know lots of people who work and can’t afford to pay 55 euro for GP visit…the whole health system needs to be restructured….there should be a state health system that we should all be paying into some small percentage each month including the people on social welfare who have enough to buy cigarettes or a bottle of wine …and this would allow us to go to GP for free, yet there should also be a system in place than instead of going to GP we go directly to a specialist, if you break a leg, what is the point of going to GP first because he still needs to send you for Xrays etc….This is another money saver…And let’s train the medical student properly, cause it is also very costly for the whole economy to go to a hospital being seen by medical staff who constantly need to wait for answers from the senior consultant…waiting and not enough of knowledge cost money too. Why can’t we learn from countries where they provide a high quality health care for everyone without long queues. And i think when we will study these countries we will learn that there is no free health system.
Excellent points!
Competition in Ireland means the consumer pays more! GPs are independent sole traders yet remarkably they all charge in or around the same fees! If they were competing with each other they’d lower their prices. Similarly dentists and other ‘healthcare professionals’. We’ve had a private public mix for decades and the cost of healthcare continues to rise with massive payments being made to consultants
No it doesn’t. Not on a relative basis.
Agreed though that the better the care, the more expensive it will be.
If there were more private options, would that force the governments hand to provide a better service?
Or do we continue to whine and moan about the outrageous salaries and ministers running a monstrous bureaucracy.
The less that is in between patient + doctor, the cheaper and more efficient the care.
Logic says you are incorrect.
Gps do not receive a commission for prescribing particular drugs.
Ohhh ok let’s call it incentives…
and they don’t get paid for taking blood so my sick sister was refused blood tests from her gp last week…on these grounds. after a hell of a ‘discussion’ he capitualted. i was shocked he even mentioned he didn’t get paid
Right. A biro. A mug. Stcky pads. Real nice !
GPs prescribing the latest pharmaceutical drug on a commission base rather than prescribing what will actually cure your illnesses!
“Doctors differ and Patients die”
Again…. Our government trying to disfigure a solution to keep oir dissatisfaction down. There are several countries that have working healthcare systems. Why use not use one of theirs as a model. Yes… No system is perfect, but by borrowing a working model… We know what to expect.. Good and bad.
Why do our government always have to reinvent the wheel? Stupid question…. I know the answer. It is to insure their jobs are secure.
Don’t think they are trying to reinvent the wheel in fairness. The article said they’ll be modelling it on the Dutch system of healthcare.
My bro inlaw is in the Netherlands at the moment, he says the costs are expensive and rising fast for healthcare..
Scott… I missed that… Thanks for pointing that out. However, helathcare cost will rise…. The question is… Is the money for value? Are you getting great customer service with cutting edge medicines and techniques.
We have a health care system. .. But the system is totally below standard. This is not to say the health care workers aren’t working hard.
If we all have health insurance what happens to the waitng lists? We will go the same way as the UK, everyone waits, except those with “top-up” private health insurance.
The UK system has free GP access but it is a problem. People will go for the most minor of conditions thus clogging up the system. Prescriptions are charged at a standard rate of, I believe, £8 per item. However their are a range of exemptions for peope on social welfare, children and people over 60. You can also pay an annual sum of about £100 to cover all your prescriptions for the year.
All hospital stays and procedures are free at the point of use.
The service is paid for partly from social insurance at 10.5% of income, partly from the universal community charge and partly from general taxation.
The complaints are very the same as ours, the system can be hard to access, but once your in it is excellent.
Having lived for many years in England, I have to say that, in my eperience, the health service here is far better for the patient.
What FG want to do is ensure that health care is opened up for the benefit not of patients but for business which support them
Free GP care is a great idea, it will hopefully catch problems earlier than would have otherwise been the case
Lets get down to tackling the vested interests, pharmacy companies, pharmacies, consultants, lawyers etc that clog up the system and ensure that it is more expensive to operate
The gov. need to tackle issues that are costing us billions to run the health system, alcohol, diet of people etc.
If 64k have cut their health insurance what is the knock on effect of this on the health system and budget, lets have some analysis done, can the workforce cope with this? Is this adding to an overrun in health budgets?
The whole healthcare system here needs to be overhauled , the Cubans have one of the best and most cost effective health systems in the world perhaps that model could be looked at.
No – Tho Cuba has one of the best health care systems – free and it works . We will once again as with the Economic policy that ruined us – follow USA and Obama care – which will make lots of money for Insurance companies .
There should be no space for profit, religion or business in care of any description. A centrally funded system with a specific focus in preventative methods and primary care would be cheaper and fairer in the long run. I would include nurseries, children’s residential, at home care, disability care and elder care in there too. Who remembers Lea’s cross and the many nursing homes closed down since HIQA was established. There is a floodgate about to be opened when the disability sector, mostly with a history within the religious communities, had to answer to HIQA.
Listen lady….I am not going to dance with you at this hour of the morning, Especially with someone that hasnt used their twitter account since July and only follows 2 people!
We wont get into the whole “Administration of Vaccines” debate!
Jakki B the quintessential conspiracy theorist. Big business and vested interests are out to kill you. Vote Ben Gilroy every time and let’s have a Dail full of independents holding hands and pulling together for national strategic interests. Puh-lease, go back to the parish pump.
Jakki B. If you wish to criticise people go right ahead just check your facts first. And it’s quite in order for me to take anyone on at any hour.
There are a few different problems with the health system in this country. First of all there the majority of people do not thankfully have to attend hospital very often ergo the associated costs of healthcare are for the most part of the radar of the regular person. This can lead to the mentality that i should not have to pay for it because i am not using at the moment. There is no such argument when it comes to a 20 cigarettes a day habit incidentally will set people back over €3000 a year. if the same argument was made for the roads some of us only use the motorways once or twice a year yet they do need to be maintained. money for that comes from including other sources the central exchequer. If the same mentality were applied to the roads that people ascribe to the health system your once a year trip up to croker or lansdowne would be very bumpy indeed. The facts are that health care is a constant cost that must be paid for. Last years present health budget of 14 million divided amongst the 4.5 million citizens works out at approx. €3500 euros a year. This is the cost at present of providing the present level of service. Based on this to provide a top notch health service to the entire country it would be necessary to spend roughly €4000 per year per person in the health service. This is for every person not every working person so for a family of two adults and two children this works out as €16000 per year. It is further complicated by the fact that when a person gets old the associated health cost increase year on year exponentially. Therefore in order to provide for future health care cost the actual figure ends up being more like €8000 per year. this figure is only further complicated in that some countries have a higher growth rate than ours which means they can afford to pay more for the same product. This pushes the price up year on year which means either we pay more or do without. In order for us to pay more into the health service either the amount of taxes we pay increases via growth which is not going to happen any time soon or the percentage tax take increase. Failing that we could borrow money which only leads to problems down the road. Getting hospitals to compete for business in the vain hope that they can make something out of nothing is circling around the issue. James Reilly knows better than anyone. this is obviously a pr stunt deigned to distract from the issue. the bottom line is that a lot more taxes are going to have to taken from people to pay for this new health service if it is to work properly. assuming this is going to be a one tier health system as he has said new practice are going to have to be introduced across the board. a situation where someone is waiting three years on medical card for a new hip is unacceptable.
Attempting to blame over worked staff is also pointless as a nurse or a doctor can only do so much within a allocated time.
In addition a centre of excellence in the middle of Dublin is no good to a farmer in the midlands who has just had a heart attack. Why is it that there is not a helicopter service on hand to negate the distance problem inherent to centres of excellence.
Needless to say the service is a mess as it stands and needs an detailed empirical review
Our health system is a mess. All the HSE wants is each department to make cuts on everything. Staff are under constant pressure to do this. We need a total overhaul of our health system. Agree wholeheartedly with all the comments on this subject matter.
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