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The UK Health Care Briefing Gordon Campbell Isn't Getting

Private deals drove up costs, slashed care, say critics.

By Tom Sandborn 6 Mar 2006 | TheTyee.ca

Tom Sandborn was born in Alaska and raised in the wilderness by wolves. Later, Jesuits at the University of San Francisco and radical feminists in Vancouver generously gave time and energy to the difficult task of educating and humanizing him. Tom has a formal education, too: a BA from UBC. He has been practicing the dark arts of journalism off and on ever since university, and now also has about five decades of social justice, peace and environmental campaigning under his belt.

Tom's goal is to live up to the classic definition of a journalist's job from H. L. Menken - to comfort the afflicted and afflict the comfortable.

Reporting Beat: Labour and social justice, health policy, and occasionally environmental issues.

What is the most important issue facing British Columbians?: Two key issues face BC residents (and they're both so compelling and complex that Tom refuses to rank them): income equality and environmental degradation. Both desperately need solutions.

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[Editor's note: This is the first in a three-part series on health care reform issues in European countries Premier Campbell has visited.]

"It's Monday, so this must be London, Mr. Premier." By the end of today, Gordon Campbell will have finished a whirlwind week of travel; visiting Sweden, Norway, France and the United Kingdom. Hard on the heels of a throne speech heralding health care reform for BC, he will have visited a number of hospitals and clinics and met with many officials in order to, as his press release put it "explore new approaches to improve B.C.'s health care system."

Those new approaches likely will include various opportunities for health care profit-making and privatization.

Today, for example, one of Campbell's London meetings seems to be with an organization in Britain that promotes government "partnerships" with for-profit companies.

The matter is somewhat obscure, as the premier's official itinerary lists a meeting with "Partnerships Health UK," which doesn't seem to exist, at least within the realm of Google search. What does exist, however, is a government-sponsored body called Partnerships UK, which was created by the British government to promote government/business joint ventures in health as well as other sectors. This seems a likely candidate to be the meeting on Campbell's schedule today.

The Tyee contacted Campbell's press secretary Mike Morton on Friday with a request for more detail about whom the Premier will be meeting this Monday, but received no reply by Sunday night.

In any event, the Campbell Liberals' avid interest in market-oriented reforms to the current health care status quo is no secret.

Rounding out the briefings

To round out the discussion the premier's travels are intended to spark, The Tyee has gathered research and reflections on European health care that otherwise might not return to BC in Gordon Campbell's briefcase.

Today, we'll consider some aspects of system reforms in the United Kingdom. In following days, we'll take a look at Sweden, Norway and France; Campbell's earlier stops on the tour.

Britain's National Health Service was launched in 1948, and it has been the centerpiece for international debates about health care policy ever since. Denounced as "socialized medicine" and praised as enlightened social policy, the NHS has always been controversial.

The election of Conservative Margaret Thatcher in 1979 inaugurated a decade of cuts to the health service, and the current Labour government under Tony Blair has enacted still more sweeping changes, many of them involving the use of private finance initiatives (PFIs, the mechanisms known on this side of the water as P3s or public-private-partnerships) to finance and run hospitals.

Since 1997, 94 percent of new hospitals built in the UK have involved PFIs. Many critics in Britain think this has been a disastrous policy.

'Public Fraud Initiatives'

One of those critics is Dr. Allyson Pollock, a professor at the Health Services Research Unit, the School of Public Policy, University College London. Dr. Pollock is deeply skeptical of claims made for PFIs as instruments for building and operating hospitals. Her 2002 paper in the British Medical Journal titled "Private Finance and 'value for money' in NHS hospitals: a policy in search of a rationale?" suggests that PFIs have been a financial and service delivery disaster for the public, creating large amounts of long-term debt, while sharply reducing service delivery.

The toll: a 30 percent loss in bed capacity and 20 percent reductions in staff in the hospitals and their areas served studied after PFIs were implemented.

Those cuts, Pollock says, failed to deliver any of the cost reductions and efficiency improvements promised by proponents. Further, she and her co-author argue that the fiscal case for the public-private-partnership structures depends upon deceptive accounting procedures that fail to stand up to critical review. In particular, she points to value for money computations and risk transfer costing procedures as suspiciously flexible and suggests they are routinely adjusted to create the false impression that the privately financed and operated hospitals can deliver real savings and efficiencies.

These observations prompted one commentator, writing in The Guardian newspaper, to refer to the government's beloved PFIs as "Public Fraud Initiatives."

'Riddled with … problems'

In another article in 2003, Pollock and a coworker conducted a case study of hospitals in Scotland built under the PFI model. They concluded "New financial evidence suggests that further hospital and community downsizing, over and above the 24 percent reduction in beds and associated services, may be required to meet the financial deficit, principally due to the high costs of PFI."

Pollock and her research colleagues say the UK experiment proved that public-private-partnerships were notably effective in delivering profits to the private sector, but much less successful in delivering promised efficiencies, better service and more sustainable financing. The main impacts of PFIs, they say, are to add the cost of profit margins to health delivery operations and to impose pressures to reduce and degrade service delivery in service to the bottom line. (Both Pollock articles are available online at http://bmj.bmjjournals.com)

None of these findings would come as a surprise to Dr. John Lister, London-based author of "The PFI Experience: Voices from the Frontline," a report published in 2003 and funded by trade union groups in the UK. Based on research visits to nine hospitals in England, Scotland and Wales, Lister found:

"All Trusts visited were facing extremely serious financial problems, partly through the costs of PFIs and partly as a result of the pressure on front line capacity. All buildings visited were riddled with structural and design problems. . . The concerns of most support staff revolve around the reduced level of care they are able to give. . . It is tragic that such a large and welcome hospital investment programme should have produced such universally poor results." (This paper and other resources on privatized health care initiatives in Britain can be found at the union webpage http://www.unison.org.uk/positivelypublic)

'Learn from our mistakes'

Some prominent British doctors have spoken out, warning Canadians not to let similar damage be done to our system. In 2005, the Association of Surgeons of Great Britain and Ireland came out strongly against private sector involvement in the National Health Service. Dr. Jacky Davis, a senior British radiologist writing in The Guardian, said "We see hospitals closing wards and operating theatres. We see huge profits already going to PFI companies. We are not deceived by the rhetoric about patient choice and predict that patients may lose the one choice that is important- a good comprehensive local hospital."

Later that year, Dr. Davis, and his colleague on the executive committee of the NHS Consultants' Association Dr. Peter Fisher, wrote directly to the Canadian Medical Association, saying:

"We are writing, as British doctors, to share what we have learned first hand about the dangers of private sector involvement in health care, in the hopes that our colleagues in Canada can learn from our country's mistakes and reject private care and other market-style policies…. much of the additional money is being diverted from its proper purpose-that is, providing front line care- by the government's other policies. Presented to the public as 'modernization,' these include payment by results, Private Finance Initiatives, competing providers and the 'patient choice' agenda. Firstly, the money is going into private profit. Short term improvements in easily counted and politically important areas like waiting lists are being achieved by expensive deals with the private sector."

US insurers looking north?

This list of rationales for private sector involvement in health care may sound familiar to anyone who has been paying attention to the debate in Canada or to Premier Campbell's own speeches on the subject.

Assuming the premier doesn't make time while in London to visit with Drs. Davis and Fisher, he may want to test his assumptions by giving Colleen Fuller a call when he gets back home. Fuller, an independent Vancouver-based health care researcher whose book on health insurance issues, The Bottom Line is due out this month, has studied the situation in the UK.

"In the UK," she says, "public-private-partnerships in health care have been a complete disaster."

Fuller believes the BC premier's trip to Europe is designed to divert attention from insurance companies and private health care interests coming into this province from the US.

"This government is ideologically driven," says Fuller. "Campbell isn't looking for new data, he's looking for a baseball bat to drive people toward private health care."

Tom Sandborn is a Vancouver journalist and a regular contributor to The Tyee.  [Tyee]

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