<div dir="ltr">Dear Claudio, thank you for this information.<div>Do you get Adam Wagstaff´s paper on his research ?</div><div>Roman</div><div><br></div></div><br><div class="gmail_quote"><div dir="ltr" class="gmail_attr">On Mon, Jul 1, 2024 at 4:42 PM Claudio Schuftan <<a href="mailto:schuftan@gmail.com">schuftan@gmail.com</a>> wrote:<br></div><blockquote class="gmail_quote" style="margin:0px 0px 0px 0.8ex;border-left:1px solid rgb(204,204,204);padding-left:1ex"><div dir="ltr"><div class="gmail_default" style="font-size:large"><br><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><span>KUALA LUMPUR, Malaysia, Jun 26 2024 (IPS)</span><strong> </strong><span>-
Comparative research on healthcare financing options shows
revenue-financed healthcare to be the most cost-effective, efficient,
and equitable, while all health insurance imposes avoidable additional
costs.</span></p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><strong>Private health insurance</strong><br><span>Rejecting
the private health insurance option is easy due to well-known US
problems. Risk pooling is limited as private insurance only covers those
who can afford it.</span></p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">The
resulting ‘moral hazard’ and ‘cherry-picking’ problems reflect the
public’s weak bargaining power vis-à-vis healthcare providers and
insurance companies.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">US
health spending per capita is the highest, partly due to additional
private health insurance costs. The share of US national income spent on
healthcare has risen to 18%!</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Such
avoidable insurance management costs are quite high, averaging almost
4% more. Consequently, upward cost pressures remain intense.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Yet,
despite spending so much, it only ranks 40th in average life expectancy
worldwide. Its other health indicators also leave much to be desired.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Hence,
greater spending does not necessarily improve health outcomes, and
spending more on insurance does not improve health either.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><strong>Revenue financing</strong><br><span>Hence,
the main healthcare financing choices are social health insurance (SHI)
and revenue financing, which enables risk pooling for entire national
populations.</span></p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">After
reviewing extensive evidence, the World Bank’s Adam Wagstaff found
revenue financing much more cost-effective, efficient, and less
expensive than insurance options.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Germany,
the only major OECD country heavily reliant on SHI, is second only to
the US in health spending per capita, largely due to insurance
administration costs.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">With
insurance premium revenue increasingly inadequate, the government
finances the ever-growing funding gap. Rather than being a healthcare
financing option for the future, it should be recognised as an atavism,
even for highly unionised Germany.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><strong>Social health insurance</strong><br><span>SHI
advocates insist it is needed owing to inadequate fiscal means. But
budget shortfalls imply a lack of political will. SHI’s claims to raise
more money are grossly exaggerated.</span></p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">SHI
premiums are effectively flat or pro rata taxes, making overall tax
incidence more regressive. SHI financing is inadequate everywhere and
under growing stress due to ageing societies.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Most
governments claim to be committed to inclusion and equitable access,
but SHI would undermine declared national commitments to the WHO’s
‘healthcare for all’ and the UN SDGs’ ‘universal healthcare’.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Besides
betraying these commitments, SHI cannot ensure the needed funding or
financial sustainability. Any realistic government should recognise SHI
will be politically unpopular.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">SHI’s
costs and dangers, including the perverse incentives involved, are
rarely acknowledged. Employers have minimised their SHI liabilities by
casualising labour contracts. Rather than employ workers directly, they
hire indirectly, using various contract labour arrangements.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><strong>Priorities?</strong><br><span>The
typical emphasis on curative health services has also worsened health
outcomes by neglecting vital public health programmes. By emphasising
curative services, many causes of ill health do not get sufficient
attention.</span></p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Many
preventive and public health problems remain neglected and underfunded.
Most governments must spend more on prevention, especially to address
largely preventable non-communicable diseases (NCDs).</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">The
world needs far better healthcare financing. Various complementary
reforms are also required. Instead, poorly sequenced, ill-considered
reforms have been the norm in recent decades.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">The
resulting ‘non-system’ offers poor, weak and ineffective incentives for
public and preventive health provision. Meanwhile, potentially
lucrative segments have been privatised or contracted out, often to
incompetent political cronies.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">The
UK NHS capitation system successfully transformed doctors’ incentives.
Instead of prioritising patient payments, UK doctors are incentivised to
ensure the well-being of those under their care.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><strong>Recognise market failure</strong><br><span>Former
UK Conservative Party adviser and “non-interventionist market
economist” Professor Geoffrey Williams rejects “any [government]
intervention … in almost every area of economic activity, but not in
health, because health is quintessentially the place where markets fail.</span></p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">“That
is why we use health more often than any other example when we teach
about market failure, particularly insurance market failure. We know the
health market fails and that we cannot find market solutions to those
market failures as we might in other forms of market failure.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">“We
know that government tax funding is the only real way of providing
universal healthcare.” Neither universal healthcare nor health for all
can be achieved without adequate revenue financing, even if termed
insurance.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><strong>Improving healthcare</strong><br><span>Malaysia
has low infant and maternal mortality rates and improved life
expectancy thanks to simple, low-cost reforms introduced from the 1960s,
especially training village midwives to help mothers and babies.</span></p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">Lowering
such mortality is responsible for over four-fifths of increased
Malaysian life expectancy over the decades. Now, much more should be
done to improve babies’ and mothers’ nutrition for the ‘first thousand
days’ from conception to age two.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">A
‘hybrid system’ would not work, as it would only provide some public
financing to address egregious ‘market failures’. Targeting would be
worse, both costly and involving both inclusion and exclusion errors.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px">With
political will, revenue financing is sustainable despite rising costs.
We should renew our commitment to public healthcare, not as it has
become, but as it should be.</p><p style="color:rgb(54,55,55);font-size:16px;line-height:26px;margin:0px 0px 20px"><br></p></div></div>
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