Two-tier system criticised in Expert Group submissions

Support for a universal health insurance scheme is clear in submissions to the Department of Health on resource allocation. Niamh Mullen reports

Complaints of unequal access to care; criticism of the two-tier healthcare system based on ability to pay; and proposals that money should follow patients were common sentiments expressed by many stakeholders in submissions to the Expert Group on Resource Allocation in the Health Sector.
In its submission, the HSE said funding of health services should be based on need rather than ability to pay. The Executive said a model of ‘universal coverage’ should be introduced, with the language used suggesting that this should take the form of a universal health insurance scheme.
In documents released to IMT under the Freedom of Information Act, it said the system should be designed to ‘ensure the whole population has access to the same range of quality services according to needs, regardless of income level, social status or residency’.
“In the case of both primary care and hospital services, access based on need rather than ability to pay is important for health equity,” HSE Assistant National Director of Population Health and Health Promotion, Catherine Murphy, wrote on behalf of the Executive’s Health Inequalities Steering Group.
Chaired by the Director of the ESRI Prof Frances Ruane, the Expert Group was set up last April to analyse the strengths and weaknesses of the current resource allocation arrangements for health, so that money could follow the patient, possibly under a new social insurance scheme. The Group is due to report in April.
A total of 60 submissions were received following a public consultation held last year. Among those in the medical community that wrote to the Group were the IMO, ICGP, the Irish Association of Emergency Medicine, and the Adelaide and Meath Hospital. Stakeholders such as IMPACT, the Competition Authority, St Vincent de Paul, Barnardos and various individuals also made submissions.
The former director of the Adelaide Society and lecturer in public health at Trinity College, Dr Fergus O’Ferrall, said current resource allocation and financing in the health service was dysfunctional. “Our two-tier health system is a scandal and has led to many unnecessary deaths, the most high profile being that of the late Susie Long.”
System of universal healthcare
He called on the Expert Group to set out the necessary stages required to introduce a system of universal healthcare supported by a social health insurance system adapted to Irish circumstances. Such a system would enable a one-tier system with access and treatment based on medical need, not income. It would also provide a way to deliver GP services free for every-one. “It puts the patient first and means providers need to earn their revenue by the number of patients and by the quality of care they provide.” Dr O’Ferrall added it was transparent, it would add to social solidarity and would separate health funding from the Exchequer finances.
IMPACT, Ireland’s largest public service union with half of its 65,000 members working in the health service, said the level of private health insurance in Ireland reflected concern over poor or delayed access to the public system. “It is reasonable to assume that such spending could be redirected, in the form of ring-fenced taxation or a universal insurance model, provided that current contributors were convinced that a new system would feature good access and the greater prospect for quality associated with a pooling of resources.”
It said the Government’s deliberate avoidance of an approach involving universal access left IMPACT and many staff working in the public health service with little confidence that reports, such as the one due from the Expert Group, would lead to any improvements. “Policy appears to be increasingly driven by an ideology that rejects universality and favours the private sector over public provision.”
It said the so-called ‘two-tier’ system had been at the core of policy, and opportunities to develop a system involving universal access had been foregone. It cited the 2001 health strategy ‘Quality and Fairness’, which it said failed to examine the funding options in any serious way.
The National Treatment Purchase Fund (NTPF) also said one way to address equity and access was to have a universal insurance-type system in place, whereby ‘the onus for accessing services would switch from the provider to those seeking services’. “In this system, inequities in accessing services would be greatly reduced and responsibility for accessing the services would be with the consumer, rather than a central authority charged with providing the service,” it said.
The Adelaide and Meath Hospital incorporating the National Children’s Hospital said future arrangements should separate the funding and provision of health from social care services. “With a social insurance model, funding will follow the patient in a manner which will encourage closer and more cost-effective working arrangements between GPs, community care and hospitals.”
The Mental Health Commission proposed a system based on pre-payments through insurance and/or taxation that would ensure people contributed according to their means, and that people accessed healthcare according to their need.
‘No longer an affordable option’
The Irish Commission for Justice and Social Affairs pointed out the cost of private health insurance was continuing to rise at a time when net incomes were declining and unemployment was increasing dramatically. “Private health insurance is no longer an affordable option for many people who previously had such insurance.” It said the Expert Group should consider whether the introduction of a form of social health insurance would prove more cost effective and contribute to the aim of ‘improved health status and outcomes for people’.
The Women’s Health Council said the introduction of a social health insurance system should be given serious consideration. “The social health insurance model is underpinned by a number of characteristics that would make it appealing to users of the Irish healthcare sector, namely, its transparency and the guarantee that money paid towards public health service provision will in fact be spent for the purpose.”
It added attitude surveys showed most people purchased insurance to safeguard their access rather than to procure better, ‘hotel style’ accommodation. “Therefore the greater equity of access inherent in a social insurance system would also spare many taxpayers the double burden of paying both taxes and private insurance in order to secure access to services,” it said.
Vhi Healthcare said the debate on universal health insurance was required to ‘ensure money followed the patient and local governance improved’. “There are significant open issues in determining what would be funded by universal health insurance and how it would be collected,” it pointed out.
It said the funding model needed to be radically overhauled and redirected as it encouraged over-consumption and under-consumption. It calculated that if all healthcare costs were funded through univeral health insurance (€19 billion) and collected through payroll, the average cost for each person employed would be €10,000 per annum. If low earners were removed, it said the average cost would be €15,000. It added the critical issue was to separate the payer from the provider and said this could be achieved by setting up a distinct legal entity to procure and pay for services.
St Vincent De Paul and Barnardos also advocated public debate of the issue. In its submission, the St Vincent De Paul group said there should be a ‘robust public dialogue on the merits of an alternative approach to funding the health service, namely a social health insurance model’.
Barnardos said the issue of social health insurance needed to be debated in a non-political, non-ideological manner, purely on the merits of its outcome potential.
“While acknowledging that the financing and structure of the model of social health insurance chosen are complex and wide-ranging, we urge the Expert Group on Resource Allocation and Financing in the Health Sector to consider in depth the material available to them,” it said.
Cost-benefit analysis
The Health Management Institute of Ireland, a professional body for managers working in the public, private and voluntary healthcare sectors, expressed some reservation. It said before moving from our present financing system to a universal insurance system, a thorough cost-benefit analysis would have to be undertaken.
Furthermore, it said the financing arrangements were less important and less urgent than dealing with clarifying the purpose of our health service, what level of funding is to be made available, the priorities to be pursued, the expected return on the investment involved and accountability for the results achieved.
Doctors’ organisations tended to focus on other issues in their submissions. The IMO said co-location was likely to further reinforce the two-tier system but did not mention universal health insurance as a solution.
The ICGP called for a new GMS contract. It said the current contract did not encourage or support disease prevention and health promotion activities.
The Irish Association for Emergency Medicine strongly criticised the system of hospital budgeting, saying it was not clear or transparent. It said the mechanism whereby budgets were not finalised prior to the beginning of the financial year was ‘a root cause of many problems’.
The organisation representing intensive care doctors also criticised the HSE’s use of the casemix system for calculating resource allocation for the care of patients in ICU.
The Intensive Care Society of Ireland said: “We are concerned that the current casemix funding systems are inappropriate for hospital reimbursement for care of patients in ICU.”
The HSE recently announced details of the controversial casemix budgeting allocation. A total of €14 million will be taken from 18 hospitals and redistributed among 21 others. Tallaght Hospital faces the largest cut of €2.64 million.