Rationing, or rationalising reaction?

Speech at consultation on morality of health care rationing at St.George’s House, Windsor Castle, 22-24 September 1999.

As Alfred Smyth will confirm, I was a reluctant recruit to this discussion.  All my experience suggested that despite the best efforts of the organisers, answers would have preceded and prejudged the most important questions.  Though much has been made of a “great debate” about so-called rationing in the NHS, almost all of this has concerned not the “whys” and “whethers”, but the “hows”. 

Already in 1997, a respected British Medical Journal correspondent pronounced that rationing was now accepted as inevitable by all sides. A couple of months ago Professor Alan Maynard, a participant in this colloquium, was quoted in General Practitioner weekly as believing that anyone who still denied the need for NHS rationing required help from a psychiatrist. 

Well, here I am, out of the asylum to revive the debate I’m still interested in – whether or not the scope of the NHS as defined in 1948 should be fundamentally revised. 

I know, Alan knows, and every serious politician knows, that outside the charmed circle of Establishment opinion formers, most of the general public stubbornly continues to believe that if impoverished Britain could afford to apply medical knowledge to the whole population according to need and free at the time of use in 1948, rich Britain should be capable of doing so in the year 2000.  Advocates of so-called rationing proceed from five assumptions whose force depends mainly on repeating what they wish to believe, regardless of support from empirical data. These are:

1.That in health economics the word “rationing” can be used to mean virtually any kind of prioritisation or planning which limits service;

2.That demands on the NHS are infinite, while resources are finite;

3.That new treatments are generally less cost-effective than old treatments, so that ever greater investments must be made for diminishing health gain;

4.That NHS pioneers naively believed that the service would be self-financing, with costs declining as diseases disappeared;

5.That if we apply advancing medical knowledge fully to all who can benefit from it, the UK economy will be incapable of funding the NHS from taxation. 

The first assumption is most important, because it makes serious discussion so difficult.  All dictionaries I know of agree that rationing implies standardised and equal allocation of goods to individuals within whole categories of people. 

This is peculiarly inappropriate for NHS patients, whose needs are notoriously unstandardised and unequal. 

“Rationing” has a comforting resonance with wartime experience of equal shares in national crisis, but that seems a dubious and devious reason for misusing it in a time of triumphal affluence. 

More charitably, some economists may assume that any good or service not distributed as a commodity for sale, must ipso facto have to be rationed, because its distribution must be planned rather than left to operation of the market.  

This proceeds from their second assumption, that demand for any good or service available at zero price must necessarily be infinite.  This may seem self-evident from simplistic economic theory, but has little empirical support from actual human behaviour.  Free medical care does not in fact result in patients behaving like chocoholics set loose in a sweet shop, nor do co-payments have much predictable effect on consulting rates, which follow socially determined, relatively inelastic patterns, modified more by culture and beliefs than by price mechanisms.

Patients generally are reluctant consumers of medical care, because they do not in fact enjoy a simple consumer role, comparable to eating hamburgers. 

They are potentially in transition from consumers to co-producers of health care, a development which health economists concerned to develop rather than replace the NHS should encourage. 

Nor have we any evidence I know of, that new treatments are in general less cost-effective than old treatments, except in two trivial senses: that pioneer treatments on a small scale are inevitably more costly than established treatments on a mass scale; and that active treatment will always appear to be more costly than doing nothing. 

It is indeed more costly to treat end-stage kidney failure than to let people die, but the costs of dialysis and transplant are known, and their chief determinant is early or late referral. About half of all referrals are still crisis-referrals for previously undiagnosed long-standing kidney failure.  The obvious way to reduce costs is not to refuse treatment to anyone who can benefit from it, but to take continuing anticipatory care by primary teams more seriously. 

Studies of specific common procedures like hip replacement similarly confirm a wealth of other common sense options for more cost-effective health gain, before any question of limiting services need arise. 

Allegedly diminishing cost-effectiveness is linked with the fourth assumption, that Beveridge and Bevan were fools, who believed the NHS would, by reducing ill-health, incur diminishing total costs.  The NHS did in fact reduce economic costs of ill-health, and to a very much greater extent than anyone ever imagined between 1942 and 1948, when the NHS was being designed.  Tuberculosis, diphtheria, and poliomyelitis were virtually eliminated within 10 years.  Psychotic illness became treatable within the community, eventually allowing closure of large asylums.  These developments depended on systematic application of new medical knowledge to the whole population through the NHS. 

Of course, when old tasks become unnecessary, we find new tasks to do, as Bevan and Beveridge certainly understood.  Perhaps what they really failed to understand was that a future generation of political leaders would try to pocket the social savings from past medical advance, but refuse to seek the taxes needed to fund full application of medical advance in the future. 

Finally, we have the allegedly self-evident proposition that Britain having reached the limits of tolerable taxation, we have no alternative but to accept a two-tier health care system, with innovation increasingly shifted to the private sector. 

The two tables in the appendix to this paper, which I believe all of you have, show that, compared with other advanced economies, Britain has low taxes and low social spending.  It is true that our tax system bears increasingly heavily on lower incomes, because of a systematic shift from progressive income tax to regressive taxes on consumption.  That was not inevitable, but a consequence of appeasing the richest, most powerful, and greediest sections of our society.  According to the Economist, Rupert Murdoch’s main UK holding company, Newscorp Investments, has paid no net corporation tax over the past 11 years, despite profits of £1.4bn.  It has about 800 subsidiaries in offshore tax havens.  Its expected tax liability of £350m could have built 7 hospitals at current prices. 

Most of the UK national product is produced socially – not by the personal efforts of individual entrepreneurs, but by the collective efforts of employees. 

The proportion of this which should be spent socially is a political decision. In a developed democracy this should be taken by the mass of the people who must enjoy or endure the society governments choose to create.  Given this alternative to vote for, over three quarters of the population have consistently supported the NHS, essentially as it was originally conceived, despite all that neoliberal politicians and health economists could throw at it. 

Unfortunately that choice may increasingly be denied, as political leaders converge on the centre ground of public opinion not as it is, but as our neoliberal intelligentsia believe it could and should become, if intelligently manipulated. 

Typical of this trend is Professor Nick Bosanquet, who writes:

"Three serious attempts to introduce ‘rationing’ [Oregon, New Zealand, and the Netherlands] all failed but this cannot disguise the fact that rationing is the key challenge facing policy makers in the future.”

He goes on to refer to his own major survey of public opinion after the 1997 election. Its most striking general finding is a gap between expectations and wants:

“Broadly, the public wants the NHS to offer everything, and to offer it free; 65% say, for instance, that NHS services should always be free.  But, crucially, a mere 13% expect that they will be free in ten years' time.  Some 67% think that the NHS will provide fewer services and those no longer covered will only be available privately, even though 80% do not like such a prospect.  It is on this expectations gap that modernisers should focus.  With expectations so clearly dampened, the battle is already half won....This survey simply shows what the public will stomach today.  It is now up to the politicians and opinion formers to move the argument on.”

Though this manipulative view is rarely so frankly expressed or unambiguously held, the rationing debate so far has in my view been very much a part of Bosanquet’s “moving the argument on”. 

Windsor Castle is an ambiguous setting.  On the one hand, it has always been, and still remains, the apex of arrogant wealth and power.  But it also reflects some capacity for change and survival, and occasionally even for intelligent, evidence-based critical thought.  If so, perhaps the real debate may begin – and not before time.

Appendix 1

 

EU TAX & SOCIAL SECURITY CONTRIBUTIONS AS % GDP 1997

Sweden                                                                                              53.3%

Denmark                                                                                            52.0%

Finland                                                                                               47.3%

Belgium                                                                                              46.5%

France                                                                                                46.1%

Italy                                                                                                      44.9%

Netherlands                                                                                       43.4%

Norway                                                                                               42.5%

Germany                                                                                            37.5%

UK                                                                                                      35.3%

Spain                                                                                                  35.3%

Portugal                                                                                              34.5%

Economic Trends March 1999

 

Appendix 2

UK GOVERNMENT SPENDING AS A PROPORTION OF GROSS DOMESTIC PRODUCT, 1964-2001.

PERIOD         PRIME MINISTER                 AVERAGE % GDP

1964-70         Wilson (Labour)                                 39.9%

1970-74         Heath (Conservative)                        41.4%

1974-79         Wilson/Callaghan (Labour)              45.4%

1979-90         Thatcher (Conservative)                   43.0%

1990-97         Major (Conservative)                        41.4%

1997-2001     Blair (Labour)                                    39.4%

Data from Tony Travers, London School of Economics, accepted by Junior Minister Dawn Primarollo as broadly correct (though in her view irrelevant). Guardian 27 August 1999.