Health Service Funding

HEALTH ECONOMICS: SUPPLY AND DEMAND

In the 20th century, policy makers tended to look only at the supply side of the NHS equation, that is, the provision of medical, nursing and paramedical services. In the 21st century a new approach is required. If we are to create a health service that comes anywhere near to satisfying demand, we must look at the whole picture - both the supply of, and the demand for, medical services.

It is undeniable that the NHS is under funded in comparison with similar countries, but as well as calling for increasing resources, we must also argue for a decrease in demand.

DEMAND ON THE HEALTH SERVICE

Rising demand is caused by a number of factors. They fall into two main groups, which might be termed the classical, and the politico-economic.

CLASSICAL CAUSES OF INCREASING DEMAND ON THE NHS

· Increasing age of the population
· New medical technology
· Increasing Patients' expectations
· Increasing practice of defensive medicine by doctors due to Patients
Charter and increasing litigiousness of users .
· Increasing incidence of chronic (longstanding) illness

POLITICO-ECONOMIC FACTORS THAT PLACE INCREASING DEMAND ON THE NHS
· Unemployment
· Poverty
· Poor housing,
· environmental conditions
· Breakdown of social cohesion

HEALTH IMPROVEMENT THROUGH POLITICAL REFORM

THE CASE FOR THE MEDICAL PROFESSION'S INVOLVEMENT

Politico-economic are well recognised by academic researchers, but substantially ignored by health policy makers, possibly because they are regarded as belonging firmly in the domain of politics and economics, and therefore out of bounds to medical thinkers. Such demarcations are a recipe for intellectual stagnation, and also for a continuation of the unsustainable state of health services, particularly in areas of high unemployment, social exclusion, poor housing. By surveying - or, indeed as some will see it, invading - the wasteland of unemployment, pollution and poverty that politicians and economists claim sovereignty over, medical profession may be able to bring about some clarity of thinking and even some useful change. Dr John Snow was not a qualified water pump engineer, but his action on the Broad Street pump brought about more health benefits that any amount of learned papers on the causes of cholera.
Politicians used to lay the sole responsibility for health improvement on individuals. The results of this policy are extremely limited.

POLICIES FOR HEALTH

The scope of Government scope to improve health is great. It will be even better when Government begins some joined up thinking.
The argument that the BMA should pursue is summarised as follows:
· 1/5th of NHS spending (~£8bn/y). (16-22% to be exact) is wasted in dealing with illness caused by unemployment, poverty, poor housing and pollution.
· Unemployment is the root of these factors, since it causes a loss of social cohesion, brings about poverty, and through opportunity costs, allows poor housing and pollution to persist.
· There are 1-2 million jobs waiting to be done in pollution prevention, house renovation, community work and many other socially and environmentally beneficial activities, many of which will bring about health improvements.
· The present benefit system exacerbates unemployment.
· A Wage Subsidies Bill would enable socially and environmentally constructive work to be done, creating a more just, sustainable and healthy society.
· This policy would be economically possible and advantageous.

BILLS FOR HEALTH

Bills of Health proposes four Parliamentary Bills to address the problem of structural or politico-economic causes of ill health.

WAGE SUBSIDIES BILL

1. Changes to the benefit system that will abolish 100% marginal taxation that is currently applied to benefits at the point in time that the claimant finds work.
2. Minister sets up register &c.

HOUSING FINANCE BILL

3. A Bill that introduces the concept of Mortgage to the Treasury, which will enable homelessness and substandard housing to be brought to an end.

POLITICAL PARTIES (FINANCE) BILL

3. A Bill to prevent political parties from benefiting from corporate generosity.

AN UNWANTED EFFECTS RESTITUTION BILL

that will cause producers pay for the any adverse health effects of their products.

4. Commercial products - for instance, tobacco, alcohol, sugar, saturated fats, pesticides and solvents - cause a great deal of illness. At present the onus is on the victim to "prove" that s/he has been poisoned, and the causative agent is innocent until proved guilty. It would be better if the producer should assume the responsibility for paying (at arms length) for the cost of researching, monitoring and making restitution for any adverse health effects of their product. For instance, this would lead to a sugar levy, hypothecated to the NHS dental service; a cholesterol tax on butter and milk to pay for cholesterol lowering drugs, and so on.

ROAD TRAFFIC REDUCTION BILL

The medical profession should add its weight to the broad alliance of NGOs pushing for a reduction in volume and speed in road traffic.
Reduction in traffic would carry the following health benefits.
1. It would result in a reduction in air pollution which will reduce the number of episodes of
§ asthma
§ respiratory diseases
§ coronary thrombosis.

2. Reduction in noise from speeding traffic, which will result in less stress overall.
3. Reduction in direct physical threat from speeding traffic, which will result in less stress.
4. Greater ease of walking and cycling in the community (more exercise) with more opportunities for interaction between citizens - gain in socialisation.

One in two people do not have routine access to a car. These are therefore a disadvantaged group, which it is the Government's overt policy to help.
With increased provision of public transport as part of the traffic reduction package, the isolated rural disadvantaged will gain.
5. Lower burden of MVTA's on the NHS - less accidents - giving an indirect gain by freeing up services.
6. Lower burden of bereavement caused by less road traffic related deaths (currently running at some 4000 p.a.) leading to a gain in Mental Health.
7. The work created in traffic calming structures, cycleways and footways will reduce unemployment, with resultant reductions in:
§ mental ill health (especially suicide and parasuicide )
§ GP consultations,
§ smoking
§ alcohol consumption,
§ illicit drug use
§ weight gain,
§ physical inactivity

© Richard Lawson