Competition in Primary HealthCare in Ireland:More and Bettter Services for Less Money Post author By Philip Lane Post date October 14, 2011 The latest issue of the Economic and Social Review carries a comprehensive essay by Carol Boate on the competition issues in the primary healthcare (GPs, dentistry, pharmacy) sector. Categories In Uncategorized 27 Comments on Competition in Primary HealthCare in Ireland:More and Bettter Services for Less Money ← Tilburg ranking of economic departments, and Economist on MBAs → Interim Report of the Commission on Credit Unions 27 replies on “Competition in Primary HealthCare in Ireland:More and Bettter Services for Less Money” heard on the radio that a paper is going the rounds of HSE …… simply stop issuing medical cards ….. [i.e. let them die] cut more hours from the home help and carers budgets [i.e. let them die] I cannot believe that this madness is continuing ….. and that a few billion will be paid out to unsecured bondholders before XMAS … This is an excellent overview. There are obviously lots of small changes needed to improve competition rather than one radical change. Some of these are happening albeit slowly e.g. increase in training places for GPs. Others are infuriatingly slow e.g. breaking down the barriers to access to a GMS contract. The big unknown is the impact of Universal Health Insurance. This will dramatically increase the pool of ‘public’ patients and in Ireland outside of some wealthy enclaves a strong GMS contract is the cornerstone of a GP practice. If UHI is introduced without a radical review of primary care workforce it will simply be another exercise in diverting public resources from the 99% to the 1%. The Department knows this and will hopefully do more than commission an analysis. Maybe we should give that essay to the Troika, and say this is fulfilment of the MoU Q3, 2011 requirement to introduce legislation to deal with the supply of GPs, competition etc . @Johnny Foreigner Universal Health Insurance? I repeat – a memo is on the rounds of the HSE with one option being to simply refuse to allocate medical cards for a period of time …….. Krugman is probably right – the world is gone mad – “terrifying” http://www.nytimes.com/2011/10/14/opinion/rabbit-hole-economics.html?_r=1&nl=todaysheadlines&emc=tha212 @Jagdip The Troika needs a good ‘Declaration of Intent to Withdraw from the Lunacy’ spoken by an Irish Politician who gives citizen health priority over dead banks, dead bank bondholders, dead promissory notes, and the upper-echelon fiddler fraternity in the locality. Before there are any changes to the health service south of the border in the direction of reducing private sector provision of health care, which seems to be what the left-wing ideologues in the media and academia want, there should be a thorough investigation of why the almost entirely public health service north of the border is lagging so far behind its counterpart south of the border in reducing mortality rates. Since 1996, mortality rates have fallen on average by well over twice as much south of the border as north of the border. Before a ‘socialist’ health service is introduced south of the border, there should be an investigation as to why. I have calculated the falls in mortality rates north and south of the border for 10 age-groups between 1996 and 2010 (figures from NISRA for the north and CSO from the south): note: – indicates fall , + indicates rise age-group 0- 4: north -0.5% , south -37.2% age-group 5-14: north -10.2% , south -44.1% age-group 15-24: north +9.6% , south -28.6% age-group 25-34: north -4.8% , south -35.3% age-group 35-44: north +5.5% , south -20.5% age-group 45-54: north -7.4% , south -28.7% age-group 55-64: north -27.8% , south -39.9% age-group 65-74: north -36.5% , south -45.3% age-group 75-84: north -31.3% , south -37.3% age-group 85 plus: north -6.4% , south -29.3% A considerable body of opinion is of the view that, when people are given more responsibility for obtaining their own health care, they make better choices and may look after their health better. These figures seem to bear that out. Of course, factors such as climate and diet also affect outcomes. However, to be perfectly frank about it, I have never noticed much difference in the climate or dietary habits as between Tyrone/Fermanagh and Longford/Westmeath. So, the explanation is more likely to lie in the different systems of healthcare provision. Some competent health statistician, such as Brendan Walsh or Seamus Coffey, should be invited to investigate the diverging mortality trends on either side of the border before left-wing ideologues dismantle the part-private part-public health service south of the border and replace it with an entirely public health service, such as now exists north of the border, but which is failing dismally in comparison. @JtO Health care has a relatively small impact on health outcomes in the developed world, especially life expectancy. Lifestyle and environment have a much larger impact. Health researchers focus on a more relevant statistic: mortality amenable to health care. Look up OECD Health Working Papers No. 55, first author Juan Gay. See Figure 2. You’ll see that in general the countries with universal access to health care perform better than those with a reliance on private sources of funding. It’s worth noting that this is a ‘science’ in its infancy – the data is still very poor and we haven’t even started to consider confounding. With respect to your question about survival in RoI and NI they are essentially identical. In recent years RoI has ‘caught up’. I don’t think anyone knows exactly why RoI has performed so well on life expectancy statistics compared to other OECD countries in recent years. There are lots of ideas out there. I don’t know of anyone who thinks it is because of the way we fund our health services. Please note that we had the same funding system in place 20 years ago when our health statistics were appalling. I know next to nothing about the workings of our health service…… – but when you introduce competion into any utility or indeed any company and it somehow becomes more “efficient” – it creates a surplus that must be recycled – ( In the past a rich doctor buys a grandiose house , employs a builder , a nanny for his kids etc. etc.) Remember efficiency & productivity are two very different things. If this company or that is externally owned the profit surplus will leak out of the country. I am reminded of the old brewery industry vs the new brewery industry – the drinks are still consumed domestically but the shareholders are now outside the country or at least anonymous and very little labour is involved in its manufacture – on the other side the advantage is better quality beer in the main although a tad antiseptic. Who gets the surplus ? This is the most profound question of the globalised age – the service / product providers are outside all poltical control. This may have its obvious advantages but it makes the idea of community & politics completly redundant. @Johnny Foreigner With respect to your question about survival in RoI and NI they are essentially identical. JTO again: No, they are not. Mortality rates in ROI are now much lower than in NI. The OECD spokesman is quoted in today’s Irish Times as saying that ‘since 1994 Ireland has experienced stunning (his word) increases in life expectancy and falls in mortality rates’. This fact is becoming increasingly recognised internationally. A University of Bournemouth report in August (link below) found that Ireland was the most efficient country in the world at reducing mortality for each euro spent on health. http://www.irishtimes.com/newspaper/health/2011/0823/1224302853253.htm The fact that no one is quite certain why is all the more reason to be cautious in replacing the existing health service, with its significant role for the private sector, by one that almost wholly excludes the private sector, such as exists north of the border and whose results in the past decade have been much less good. Nothing should be done along these lines until the reasons for the much superior health performance south of the border in recent years, as compared with north of it, are thoroughly investigated by competent and unbiased statisticians. We don’t want fundamental changes made just for the sake of social engineeering and political ideology. @JtO Life expectancy at birth for males is 76.8 years in RoI and 76.7 years in NI. Life expectancy at birth is 81.6 years for females in RoI and 81.3 years in NI. The RoI figures are for the 2005-07 period and are estimated by the CSO. The NI figures are for the 2007-09 period and are estimated by the ONS. But life expectancy is beside the point – UHI is not about outcomes it’s about dealing with inequity in access. I’m sure you would agree that there are serious problems with socioeconomic inequities in access to healthcare in the Republic. Freeze on medical cards could hit 42,000 THE HSE is considering suspending the issuing of new medical cards as part of a raft of drastic measures aimed at breaking even in 2011. The draft proposals — published in an internal HSE document — also show that it is considering reducing home help hours by 600,000 — or 24% — and removing 400,000 personal assistant hours — a drop of 61% — between now and the end of the year in cuts that will save about €57.5 million. The HSE is considering not issuing medical cards to a projected 42,044 people under 65 — except in an emergency case — between now and the end of the year in a bid to save €18m. Read more: http://www.irishexaminer.com/ireland/freeze-on-medical-cards-could-hit-42000-170694.html#ixzz1aogVm1th Seriously? Have you seen how much money gets spent per capita in the US? And have you seen the worse health outcomes? And this is presented as a serious paper? Does the phrase “free market” remove all sense of reason from political leaders? Critical thinking just grinds to a halt the moment “competition” is a possibility. How much shopping around for ambulance prices and cardiologist price/outcome ratios will you do if you’re having a heart attack on a street corner? How many doctors do you want to chat with about your hemeroids in order to get the best price? This stuff isn’t like going out and trying on shoes. Get a freaking clues people. JtO Golden rule of public discourse : never ever ever ever praise the Irish public health system. e.g no one wants to know that mortality rates for breast cancer in the south have decreased by 30% in the last five years – directly attributable to better drugs and treatment. @David O’Donnell It sounds like madness that won’t even save money in the short term, but it’ll save money in one budget while busting another, and for the manager whose budget is reduced, that’s the right outcome. @David O’Donnell, Kevin Walsh You guys do realise that primary care in Ireland is already run by private enterprises who are run on a ‘for-profit’ basis right? And those profits are exorbitant – have you heard of any GPs going out of business recently? How could they – they have such fat juicy contracts with the State? It’s like shooting ducks in a barrel. Of course the odd GP is in trouble these days – property speculation gone wrong. Did you think we had an NHS but just called it something else? It’s very simple: we already have free enterprise in primary care, but we don’t have an open and transparent market. You can argue with the free enterprise model but if you accept it then surely you accept opening it up? @Sarah Carey All discussions about the relationship between health systems and outcomes are poorly informed because the science is weak and the data is poor. But even if we do make believe you are a long way off base about Ireland and breast cancer. Ireland has the 4th worst mortality rate for female breast cancer in Europe. Far worse than such beacons of high quality health care as Bulgaria and Poland. We have improved in recent years from a terrible starting point. But everyone else has improved as well. – it’s not like we have access to a secret stash of drugs that no one else knows about. http://www.ncri.ie/pubs/pubfiles/AnnualReport2011.pdf See page 10. @Sarah Carey See page 37 for the survival data. @Johhny Foreigner Life expectancy at birth for males is 76.8 years in RoI and 76.7 years in NI. Life expectancy at birth is 81.6 years for females in RoI and 81.3 years in NI. The RoI figures are for the 2005-07 period and are estimated by the CSO. The NI figures are for the 2007-09 period and are estimated by the ONS. JTO again: Your figures are correct, but your central conclusion is not. As you say yourself, the ROI figures (2005-07) are for 2 years earlier than the NI figures (2007-09). The reason is that the ONS publishes annual figures for life expectancy for NI (and the other UK jurisdictions), while the CSO only publishes them after each census for ROI. So, the next CSO figures for ROI will be for 2010-12 and won’t be published until 2013 or 2014 at the earliest. However, we do know that between 1996 and 2006 the average annual increase in life expectancy in the ROI was about 0.4 years. The allready-published mortality figures for ROI up to 2008 indicate that this has continued since 2006. So, a reasonable estimate is that by 2007-08 life expectancy in ROI was approximately 1 year greater than in NI. This is far from a small difference. It is very significant indeed. It puts ROI very close to the EU15 average, but NI among the worst in the EU15. In addition, going by the mortality figures since 2008, the gap has probably widened since then. I am not a medical expert and do not claim to know why ROI is faring so much better than NI in regard to reducing mortality and increasing life expectancy. I am merely saying that the fact that it is should be investigated competently before dumping the semi-public semi-private healthcare model in ROI for the almost entirely public one in NI. Left-wing health researchers are assuring us that the much better performance in ROI, as compared with NI, has nothing to do with the different systems of healthcare provision, but due to environment and lifestyle factors. True, Monaghan and Cavan are closer to the equator than Tyrone and Derry, so maybe the more tropical climate south of the border is having an effect? Also, the Free Presbyterians of Antrim and Down are long infamous for their raucous alcohol-based life style in comparison with the austere life style of southern Catholics, who rarely touch alcohol, so maybe that is having an effect? But, we should really have a proper investigation by competent statisticians, before taking the worh of left-wing health researchers that this is indeed the case, just in case part of it is due to the different systems of healthcare provision in the two jurisdictions. This post, the paper highlighted and some of the comments on this thread reveal various aspects of the current malaise in the body economic and politic. First, the paper that has been selected for the post. Is it, perhaps, an attempt to draw attention to an aspect of this ‘internal devaluation’ that is talked about much in the abstract, but rarely, if ever, considered in terms of the detailed policy and regulatory reforms that will be required? The paper is quite specific “..[excessive costs and under-utilisation of primary healthcare].. in turn can increase Ireland’s overall health expenditure and contribute to a higher cost of living in Ireland and thus lower competitiveness.” The timidity of the academics to even talk about these issues – not to mind employing their publicly-funded knowledge and competence to engage in these issues – is a dereliction of duty and responsibility – but, perhaps, perfectly understandable. Secondly, the ‘political’ context. It appears that, when the Troika arrived last November, the then Government – or, more likely, the senior levels of the government machine behind it – had begun to develop a broad programme of structural reform. The Croke Park deal, irrespective of its pros and cons, addressed broad public sector issues; the state asset review (with a focus on the semi-states) had been kicked off in the previous July; some consideration was being given to labour market reforms; a knee-jerk reaction to reduce the number of quangos collided with a desire to, some how, re-empower the Competition Authority and dela with consumer protection and representation; and the legal, medical and pharmacy professions were to be subject to some structural and regulatory reform. Given its fully justified focus on fiscal sustainability, bank sector restructuring and financial regulation, it appears that the Troika broadly accepted this programme of ‘structural reform’ and it was adopted in the subsequent – and frequently revised – MoU. And we’ve seen ‘progress’ on a number of fronts in a politically balanced manner that attempts to reconcile FG’s promotion of the private sector urges with the more statist urges of Labour and the ICTU. But, while it may generate some benefits, it is all being advanced in a manner fundamentally determined by the top levels of the government machine to ensure a re-establishment of the pre-crash power and economic relationships. Although there are major fights ging on behind the scenes and the post-crash ‘settlement’ will differ in a number of respects from the pre-crash one, the desire to return to some form of ‘business-as-usual’ is overwhelming. The result will be a long drawn-out painful economic recovery for the vast majority of citizens who are not a party to these power and economic relationships. Thridly, and, perhaps, most importantly the naive presumption in the paper – and typical of much of mainstream economics – that competition in primary health care is beneficial at all times and in all places. The idea that full retail competition is the only means of generating efficient outcomes in health, education, social welfare (and in the provision of utility services) seems to have taken hold among most politicians, policy-makers, regulators, academics and researchers and not argumeent will be brooked. Those who question it are immediately characterised as ante-deluvian, unrestrucrured Marxists and/or haters of personal liberty and free enterprise. There is no recognition of the huge search, information and switching costs imposed on ordinary citizens. It is simply not good enough to label these services – in particular, primary medical services – as ‘credence goods’ and trust that regulation and ‘professionalism’ will minimise damage to the public. Irrespective any consideration of ‘rights’ to the universal provision of primary health care and education services, there is a strong case that competition in these areas should be ‘for the market’, rather than ‘in the market’. And there is an even stronger case for more democratic control and acocuntability at the local or regional level of the funding and provision of these services. There is ample scope for competition in the market to provide the specialist and secondary sevices commisioned by primary care providers. But such alternatives are never given serious consideration because those who capture rents in the existing supply chain determine the policy agenda and ultimately finance the research. Once again, ordinanry citizens lose out. @JtO People in NI are not as healthy and do not behave in a healthy manner on a number of important indicators. 1. People in RoI smoke slightly less than in NI. 2. The prevalence of blood pressure is slightly lower in RoI than in NI. 3. The prevalence of Ischaemic Heart Disease is slightly higher in NI than in RoI. 4. People in NI drink to excess more. The big killer on the island is cardiovascular disease, a condition that is intimately linked to lifestyle and environment. If you are right about the 1 year difference between the two parts of the island (and that remains to be seen) then the differences I’ve shown might be one important causal factor. Regarding the health systems you seem to confuse provision and financing. There are no plans to change the system of public/private provision, the change is to how care is financed ie moving from one type of insurance to another. @Paul Hunt I agree with a lot of what you said, but I think the criticism of the author of the paper is a bit harsh. She works for the Competition Authority. It’s not her job to set health policy, just to comment on competition when a market exists. There is an enormous market in primary health care in Ireland at the moment. The list of goods and services that are offered by competing providers is endless. Flu shots is the classic example. The variation in price is incredible and there is a clear market failure here because of the extent to which entry is controlled and GPs manipulate information asymetry. I think the author of the paper does us a service by pointing these things out. Now it us up to others to propose an alternative. I’d agree with you that competition for the market of a service such as flu shots makes much more sense than the current system and when we have UHI that is exactly what we should be going for. @Johnny Foreigner, No intent to be personally critical of the author of the paper. I took the diclaimer – “The views expressed in this paper are those of the author and should not be attributed to the Competition Authority except where expressly referenced.” – at face value. I was simply criticising the ‘mindset’ in which the author seems to be locked. I just see it as another opportunity lost to explore an alternative model that mixes limited competition, comprehensive service provision, effective regulation and democratic accountability at the primary care (retail) level with cut-throat competition among providers of specialist and secondary services (wholesale level) to the primary care providers. This approach would compel efficiencies and the delivery of best practise and would squeeze out economic rents. It is not surprising that those already benefitting from the current arrangements or whose interests would be threatened by any changes would be strongly opposed. But it is disappointing when those who have the knowledge and the capability to examine alternatives in an objective manner fail to do so. @Paul Hunt The programme for government promises “A White Paper on Financing UHI will be published early in the Government’s first term and will review cost-effective pricing and funding mechanisms for care and care to be covered under UHI.” Presumably this will have to at least consider competition for aspects of the market in primary care. Re secondary care “Insurers will negotiate directly with hospitals to help control costs and encourage innovation in the delivery of care.” Seems to imply at least some purchaser-provider split and the beginnings of a fight for value. The White Paper will be interesting, no timetable for publication yet. Expect a fierce rearguard action and deliberate muddying of the waters from the day of publication onwards. http://www.irishtimes.com/newspaper/health/2011/0802/1224301713221.html Breast cancer mortality rates reduced significantly in both NI and RoI due to improvements in drugs. Two countries compared as both have similar lifestyles which is relevant to the debate between JtO and Johnny Foreigner. (Also note – point is Breast Check does not impact on mortality and should be cancelled but won’t. Politics over science every time). The point I was making in raising the issue is that every debate on public health is framed entirely in terms of IT’s AWFUL AND ABOUT TO GET WORSE and “IRELAND HAS A THIRD WORLD HEALTH SYSTEM”. If you approach it from that perspective, the debate is always skewed. Let’s see what works well, before assuming we’ve to change everything. The NHS has major major problems, most especially at primary care level where universal free care results in a chaotic GP system. Can’t get to see one for all the not-sick people in the surgeries. Charges do have benefits. @Sarah Carey “Can’t get to see one for all the not-sick people in the surgeries. Charges do have benefits.” There is data on this and many other aspects of primary care in the NHS. Satisfaction with primary care in the NHS is very high. Satisfaction is often a poor indicator because it is too global. But when you get down to specific issues like waiting times the NHS does well. 71% of the general public report getting a GP appointment within 2 days. The fact that it is not 100% is not necessarily a sign of failure – to some unknown extent it reflects an active approach to managing need with lower priority cases asked to wait longer. Of course we have no idea what the stats are for Ireland because our doctors still have a feudal attitude to patient information. But rest assured there are plenty of GP practices in Ireland, usually in the poorest areas, where getting to see your GP within 2 days is not guaranteed. UHI is not “universal free care” it is just another form of insurance. You will pay a premium just like under any form of insurance. There will be an insurance company. You will get a package of care, some things included, some things not. The main intention is not to improve health outcomes for the population as a whole but to reduce inequities in access for people from different socioeconomic groups. Not the poorest in society either – they have fairly good access already. It’s for those just above the income thresholds for medical cards, the upper working classes and lower middle classes. On your larger point about the general complaining about the health system I think it’s very simple. If you have to rely on the ‘free’ bit of the system the care you receive is very average. Long watiing times, rude staff, general incompetence. Don’t take my word for it – it’s what the HSE thinks: http://www.hse.ie/eng/staff/Healthstat/overall/hsopitalresults.html It’s not all bad – there are pockets of quality across the country (James’s is an excellent hospital imo). And there are some things we are doing much better across the country than say 20 years ago, cancer being the stand out. If you go private the care is more timely and people are nicer to you. I don’t know if the care you receive is any better – as I say the Irish medical fraternity don’t like nosey parkers asking about outcomes. @Johnny Foreigner I’m not sure why you’re asking me about facts that everyone knows the answer to and have little or nothing to do with my comment. Is access to primary medical treatment made more equitable by stopping the issue of new medical cards, regardless of the means of prospective medical card holders and current medical card holders? Of course it isn’t. I think a system of universal medical insurance would probably be better than the current system, and I don’t have any objection to GPs getting a pay cut, but while we have the system we have, I don’t see either a justification or a benefit to introducing inequities that don’t currently exist. @Kevin Walsh Apologies, I thought you were talking about the original post not the medical cards issue. I don’t believe anyone is being arbitrarily denied a medical card at the moment or is likely to do so in the future. The process of applying for a medical card is centralised and the income guidelines are very clear. Maybe there is a discussion document going round the HSE about changing the income guidelines but I haven’t heard of anything. @Johnny I’ll comment later on the primary care issue – for now just on private vs public. Maternity care and children’s acute care are the two services I’ve experienced publicly and both are hands down 100% excellent. And no one was ever rude 🙂 Why anyone pays for maternity care is beyond me. (other than the nice room and even that’s not guaranteed if there’s a full moon). To be honest, how hospital staff put up with rude patients and relations is another matter. I know one A&E nurse who says, it’s not the pay, it’s not the hours, it’s not the drunks or the trolleys or the pressure that drives her to despair. It’s the relatives. Later..on the actual topic… @Sarah Carey Maternity care in Ireland is a very mixed bag. The actual process of giving birth could be a more humane experience. Some of the units are a bit too gung-ho when it comes to inducing women and there is still too much suspicion of alternative models of care for low-risk women. But the whole package of ante- and post-natal care is good and free, and the mortality outcomes are superb. I don’t know anything about acute paediatrics. I would say that A&E care in general is a lot better than it used to be with some obvious exceptions (Tallaght). Regarding patient experience, the HSE and the doctors and nurses only have themselves to blame if anecdote trumps evidence. They’ve shown no interest in getting any serious analysis of patient experience in Ireland off the ground. Until they take this seriously and start measuring and publishing data we all have to rely on anecdote. My own anecdotes would turn your hair white. Some of the things that are still going on in psychiatric facilities or residential care units are straight out of a horror film. Comments are closed.