I think it safe to say that all those people in the British political and media classes who want this country to be ‘more European’ have good cause to feel quietly satisfied today because parts of Britain are, indeed, starting to resemble East Germany:
The image of hundreds of people queuing to register with an NHS dentist provided a stark reminder of the problems people encounter in finding an NHS dentist, experts say.
They need ‘experts’ to tell them this?
The queue was prompted by the announcement that a practice in Carmarthen, Wales, could take on 300 more patients – but many more were hoping to register.
The TV news has now picked up on this story and are reporting that over 600 people turned up in the hope of getting state dental treatment. They lined up along the street and had to be issued with lottery tickets in order to prevent disputes breaking out. Over half of them were turned away.
Dr John Renshaw of the British Dental Association told BBC News Online: “That picture evoked a Third World country, where you have to queue to access what ought to be part of NHS care.”
No, that picture evoked life behind the Iron Curtain where people queued up all day to get a meal. And for the same reasons!
Sending this to all of the people who cry for “free” health care.
Is pay-for-service dental care available in the U.K? Just curious. Because if it is, what these people were queueing up for was “free” dental care. That’s different.
George,
Yes there is a thriving private sector where you can just pay a dentist for treatment but most people are reluctant to do so while they believe that state will provide the same service for ‘free’.
However, as the story illustrates. ‘Free’ is not ‘free’, ‘free’ is rationed.
George, there are hosts of paid-for dentists in the UK. The British system since the 1940s has always been mixed.
I think queuing is not so bad – they just need to be better-organised queues and we need to understand why they are there. People need to understand the classic economic idea that you can either price a good or you can ration it. In themselves neither is objectively better or worse [for example we currently ration votes, one each – a future civilisation might decide to let rich people buy more votes….] – what fans of the NHS need to understand is that queuing/rationing is not a sign of something breaking down, it is a natural corollary of providing certain services free of charge.
There will always be effectively unlimited demand for free services, so they need to be rationed. Pricing is one kind of rationing, and if you want to provide an unpriced good or service you can ration it with queues or ration tickets or whatever.
Everyone in Britain could be ‘entitled’ to twelve hours a year free consultation with doctors or dentists, for example, and healthy people could be free to sell or give away their unused consultation hours to sicker friends, relatives, strangers.
As far as I can see, no-one in the whole “New” Labour government grasps that demand for free health care will always be unlimited. I quite like there to be some free health care [there is a lot of research evidence it is cheaper for everyone than individuals all paying for private health care] – we just need to explain that if we like this idea, rationing has to become an accepted part of its structure.
We can shorten the queues once we realise why they are there, and not before.
Thanks David and Mark. Suspicions confirmed.
mark – could you steer us to a link on the research confirming that “some free health care” is cheaper for everyone than “individuals all paying for private health care”?
Good call, R.C.! Give me a moment…
I’m not sure what results Mark can find in response to R.C.’s query. But I’ve managed a number of analytical studies, and I know one can usually obtain whatever results one wants by careful tailoring of, eg, the study assumptions. (Less scrupulous analysts simply “spin” the data.)
People conducting studies of the sort that examine whether or not “free” health care is cheaper overall are — alas, and imho and experience — rarely disinterested parties.
Here’s a paper suggesting US health spending is over fifty per cent higher than other OECD countries.
The resultant health care is better, I’m sure, but the consensus I’ve always seen is that it is not fifty per cent better in the US. So value per dollar is less if this is true.
I’ve seen frequent pieces with comparitive data in The Economist [not a little free-market-oriented], which I must apologise for being unable to find just now, suggesting that state-subsidised free health care [almost certainly mixed with a large private health-care sector to reduce corruption and pricing problems in the free-health sector] is overall a better deal.
During the last elections in Britain, The Economist ran a piece suggesting that while health standards were lower in the UK than in other EU member countries [a major New Labour campaigning point], the costs in Britain were even lower, and so that the UK version of state health care mixed with private [there are of course numerous versions of free health care] was actually the best value for money in overall health indices in the EU.
I think one standard economists’ argument goes like this. In certain markets a kind of natural information-related inefficiency emerges called a tournament effect. The same reason the world’s number one tennis player frequently earns ten times as much or more for a couple of years as any of the world’s other players in the top ten or twenty is how the ‘best’ surgeon or dentist can charge a lot more than the ‘second-best’. The desire to spend on name recognition among the buyers.
That is, tournament effects, winner-takes-almost-all effects, lead to wasteful allocation of resources towards a handful of star performers in certain industries because of the perceived information costs to consumers of understanding that the 499th best dentist in town may actually be damn good too, and only a little bit worse than the best dentist in town. Tournament effects tend to be strongest where a specialised industry sells direct to a wider public who do not have time or knowledge to compare skills in a more informed way.
So the best silicon-chip designers get paid a lot more than averagesilicon-chip designers, but not that much more. Not by anything like the margin that big names in entertainment or medicine can outrank their near competitors, because silicon-chip designers are selling to a more informed set of buyers who can afford to bring a more detailed information base to the buying and therefore price-setting process.
Does that make sense?
Yes there is a thriving private sector where you can just pay a dentist for treatment but most people are reluctant to do so while they believe that state will provide the same service for ‘free’.
However, as the story illustrates. ‘Free’ is not ‘free’, ‘free’ is rationed.”
Right, and if I’m not completely mistaken, you pay for it via your taxes anyway, so the idea of ‘free’ healthcare/dentist treatment provided by the State is just an illusion?
Mark, the cost-quality metric you alude to is important. But what is seems to overlook is what analysts might call a “boundary condition” — in this case, when very inexpensive (ie, “free”) health care is effectively unavailable.
Canada has national health care. But the roads leading south from Canada are clogged each day with Canadians seeking health care in the US. They have to pay for this care, but the “free” care is essentially not available at home.
Absolutely agreed, George.
As I said earlier, if health care is not priced, it must be rationed [like any other unpriced good]. Of course state health care is not free, only free at the point of supply – it has to be paid for by taxes.
I’m in favour of explicit rationing of free health care, because I’m convinced by some utilitarian arguments [see above] that a bit of free health care can give a better deal in the overall mix, and I’m also convinced by some soppy arguments [I say it myself!] that it is nice to give some health care free at supply to people who are ill or injured.
Of course, subsidised health care free-at-supply can be – and often is – badly mismanaged.
I think crucial to making it work as well as it can, is that :
1] there must be a large and independent private, for-profit health sector alongside it, and
2] that everyone must understand that unpriced goods need to be rationed.
The BBC piece shows the classic left-wing misunderstanding that rationing [here in the form of queuing] is a sign not enough money is being spent on health care. I say, and I’m sure George would agree with me part of the way, that rationing is indispensible with unpriced [that is apparently free, obviously tax or gift funded] goods.
Queuing is passive rationing, and I think works much less efficiently than active rationing, where you say what you are doing [such as giving all voters a quota of unpriced hours or treatment units per year at the doctor/dentist] and explain it is the only way unpriced health care can work.
Having been sold a ‘bill of goods’ at the onset of the Welfare system in the late 1940’s. Much against the general feeling that such a thing could be sensibly, and fairly achieved, the public embraced the concept wholeheartedly.
So having subscribed to, and supported it, (the Social Welfare system), for some fifty odd years, the older members of the community feel that after all the politicians promises, there should at least be some sort of system in place that allows them a basic level of prompt and dignified treatment.
Standing in a queue for several hours just to register for a service, not to receive treatment, is not a definition of the above. It is all very well for you Samizdatistas saying, “privatise the lot, ” but there must be some safety net for the older generation, who have contributed large sums over a long period to finance the Ponzi scheme.
The cost of private medical and dental treatment is quite expensive, especially when you consider that a lot of the infrastructure has been paid for by the aforementioned Welfare System. No small part being the training of MD’s and DD’s.
To buy an acceptable level of health insurance, at age sixty plus, is beyond most people’s budgets, unless of course you are a retired employee of HMG.
I have long believed in providing my own health insurance, and started with a monthly premium of some twenty five pounds, for myself and family, now the premium for myself is over five hundred pounds a month, and that is at age sixty eight!. with substantial annual increases. Heaven help me if I actually have to use the insurance. Obviously, these rates are unaffordable for any ordinary pensioner, (me), who has survived the years of massive inflation in the 60’s and 70’s.
Had I purchased health insurance and contributed to a pension fund, instead of having to contribute to the Govt. scheme, the end result would have been far superior to that now available from HMG, and with much smaller contributions.
When you consider that the employer and employee pay a combined contribution in the region of twenty percent of a persons salary, then you get some idea of the sort of cash flow that is wasted by any nationalised outfit. It is no urban myth that any item or service provided by Govt. will cost three times as much as the same service provided by a competitive private enterprise.
So, Mr. dH. and Co. dont be quite so quick to throw the old system out without considering all of the consequences.
If the system had been restricted by some sort of residential or contribution qualification from day one, then maybe, just maybe, we would not be in this mess now. How utterly stupid to think that we (the UK), could provide health services to virtually the world.
I think you’ll find, e young, that we agree on all points. Rationing is needed to make free-at-supply health care work, explicit, active rationing is better than passive rationing [namely queuing] – and on this thread I have several times said I do not want to abolish the NHS.
I like the NHS, and am not in favour of abolishing it all, as you can see from my comment just before yours.
Our only disagreement would be over supplying health care to people who are not British residents. This is a puny, insignificant cost. I can understand people feeling it is unfair, but it is totally unrelated to the problems the NHS has now. I would be surprised if the cost of supplying free health care to foreigners even amounts to one hundredth of one per cent [so one new penny in every hundred pounds]. A solid thirty thousand million odd pounds is being spent annually on the NHS and the dissatisfaction and inefficiencies are because voters and politicians don’t understand rationing is needed for unpriced health care. It could easily be made to work, as e young rightly suggests.
I agree with Mark, except perhaps on this point:
Rationing of all health care (not merely that which is “free”) is not only appropriate, it’s inescapable. I recently underwent a medical exam involving surgery for which I had to wait 6 weeks, even though I am personally paying for much of the cost. My wait constituted, technically, a rationing.
Perhaps the point is a trivial one, but a medical system that was not rationed at all — service on demand, so to speak — would be terribly inefficient and costly.
A p.s. for Mark,
The so-called ‘tournament effect’ is not really applicable to the health industry, people seem to go more on personal recommendation, than anything else. This takes into account many factors other than ‘star’ quality.
It is taken for granted that if a doctor is in practise, then he/she will be certified to practise by some higher authourity, and, by definition, will be of a certain quality or expertise.
There should at least be some sort of system in place that allows them a basic level of prompt and dignified treatment … some safety net for the older generation
It pains me to say this, e young, but you and countless others have been blind-sided by an historical fact: socialism (or whatever you wish to call it) doesn’t work and never did.
I am only a bit younger than you, but I live in the US and the health insurance I pay for is private. The private sector has incentives to (1) provide adequate care, and (2) control costs. The government — whether American or British — has no such incentives.
As Ronald Reagan put it, “Government isn’t the solution. It’s the problem.”
I think you’re right about Britain, e young, but that’s exactly why health care overall is still cheaper here! State-subsidised [and as you rightly emphasise, state-certified] health care provides a kind of floor below which quality standards are expected not to drop.
I think the tournament effect works more in the US. I meant that as a suggestion of why US health care spending might be inefficiently high. A public perception [probably partly false, partly true] in the US that free means dangerously low-quality, and that therefore expensive is a guarantee of it being good, and the best is always worth paying much more for.
Also, paradoxical effects where people actually value something more because they’ve paid more for it are part of the equation. Art dealers have long known that you can often shift a picture for five thousand dollars that you’d never sell for five hundred. An element of that may affect the US health market where private health more sets the pace for salaries, prices and standards than in Europe.
And George, yes – all health care has to be rationed, because it is still very labour-intensive [ie a man operating on me cannot be cutting you open at the same time] so difficult to create the same efficiencies of scale we saw in manufacturing in the 18th and 19th centuries. There is also the danger that with a very large and dominant free-at-supply health sector [such as Cuba] price-setting in the form of bribes will be very erratic, because secret and uncertain – with the result that everyone waits a lot longer. Even worse, money coming in through bribes is not helping the system to expand to meet demand – as open private-sector pricing would.
Mark,
Health care for non-residents is not confined to the hapless holidaymaker who breaks an arm or leg, There is, and has been for many years, a legal and lucrative business in ferrying peole from the Continent for treatment in the UK. A favourite reason to come here is for confinement, another is for an abortion, all provided by the NHS with no charge. As you may have heard the maternity part of the NHS is now in dire straits.
The latest, is the transporting of AIDS patients from the African continent for treatment here. I think your dismissal of the cost of treatment for ‘strangers’ as being minimal, is rather wishful thinking and that the cost such treatments is quite substantial.
I’m sure that the stories of patients being booted from GP lists to make room for asylum seekers, is not all hearsay. Doesn’t sound too insignificant to me!.
George,
We were not ‘blind-sided’, we had no alternative at that time.
A private individual could not contribute to a pension fund, other than that provided by the State through NIC, until about the mid 1970’s, and then such a contribution was minimal, (7% of net annual salary), which in the days of 25-30% inflation was not going to provide very much of an annuity at the end.
There was no such thing as private health insurance until the late 1970’s. and it only came into being when the quality and delivery of healthcare became either too bad or too erratic to be of any use to anyone who was not employed in a nationalised industry or for the Govt. It was allowed and came about as a stop gap, when complaints about the NHS got too loud, (yes, even then it was crap).
The idea that cheap =bad, and expensive = good, is a very american idea, bought about by the ad industry. My idea of a true American is one who knows the value of a dollar, and can make it squeal a bit, before letting go.
When I realised that socialism is the root of all evil, I moved to the US, where incidentally, things are a little better, but beware the signs are all there, and it is a very slippery slope.
Maybe you’re right, e young, I could easily be wrong! I’d have to check the figures.
I do remember all my friends being deeply impressed when Labour in opposition in 1996 said it could save a hundred million pounds [big money!!!] for the NHS in unnecessary paperwork.
I tried, with limited success, to point out to my friends that 100m pounds in the NHS is next to nothing.
Less than one third of one per cent [of a thirty _thousand_ million pound annual bill], and by quick mental arithmetic clearly not enough to even give everyone in Britain one dental filling. Even assuming you could price a dental filling at two quid – probably closer to ten pounds, no? Dentists/patients out there, anyone?
Now I think about, I recently got quoted in Budapest by quite an inexpensive dentist, a price of round seventeen pounds for one filling. At that rate, New Labour’s trumpeted paperwork saving would not have even bought one new dental filling for everyone in _London_.
People rarely know the context to put costs in. My suspicion is [and I admit that is all it is] that if even one British area health authority was spending only twenty million pounds a year on foreigners [which would be a drop in the ocean], they would have complained about it officially years ago.
e young —
We were not ‘blind-sided’, we had no alternative at that time.
Well, I’m honestly sympathetic, although I can’t escape the suspicion that British politicians — when all was said and done — acted according to what they perceived as their constituents’ wishes.
As for The idea that cheap =bad, and expensive = good, is a very american idea, bought about by the ad industry.
The equivalents you present are certainly not literally true, but few sensible folks would doubt that they have the ring of truth (often based on hard-earned experience). And just because the “ad industry” promoted the idea doesn’t make it false, of course.
Mark,
I think you may be misunderstanding the bureaucratic mind on this one. Far from complaining about any undue expense on treatment of foreigners, the administrators are actually very proud of their willingness and ability to treat foreigners, even to the extent of giving them priority, – sounds incredible, but true.
Nearly every person I have met that works for the NHS, in whatever capacity, are very defensive of any critsism of the service provided, their loyalty is of religious proportions. From Administrators to Janitors, they are prepared to defend the system against all-comers.
While the rest of us are concerned with the future of the NHS, the employees are blithely continuing in the same extravagant ways of the past, with the ‘all are welcome’ mantra, being held in sacred esteem, they really do have a different mindset from the rest of us.
George,
Since when have Socialist politicians ever perceived anything, let alone their constituents wishes?. By their logic we are all too stupid to have any viable ideas. You have no idea how dogmatic these idealoges are.
Mark, you’ve been posting interesting economic discussions that are calm and pretty robust in their utilitarianism. However, I don’t think you’ve directly tackled what in my mind is the central issue of all government-funded healthcare systems: Why do you believe people should be forced to pay for the healthcare of others?
Interesting question, Charles. [I hope I’m not too much of a utilitarian, by the way! You frightened me there!]
There is the general free-rider defence of state-funded all-sorts-of-things of course, which equally applies to health if you like that sort of argument.
But rather, I’d suggest other people’s health is worth funding for us as individuals because diseases – epidemics in particular, but all infections – are communal problems. That is to say, we have a selfish motivation for paying taxes to make it free or almost free for poor people to have regular check-ups etc, because a pool of unhealthy people in a country provides a sink in which a disease can grow from insignificant to epidemic proportions very quickly.
In other words the rest of us are much safer subsidising poor people to be if not personally healthy, at least regularly popping in to see trained doctors.
An interesting point about viruses and bacteria is that they mutate very fast, and within a population of healthy individuals, they mutate towards safer forms, while in a population of already ill individuals, they mutate to deadlier forms. It’s all a random walk of course without the virus “planning” what to do, but the point is that a virus that has just infected a man already on his last legs which then mutates into a more virulent form will have more success spreading copies of itself to other hosts, previous success in which is of course what’s its presence today is due to.
Let an underclass of low-income sickly people fester who get out of the habit of visiting doctors and dentists because they don’t want to pay for it, and you have an ideal motor for rapidly transforming minor viruses into deadly epidemics.
A related point is that there is a network, or relationship effect in epidemics. A large group of people living in the same part of a city as poor people tend to do is what can give an epidemic real momentum and let it take off.
The rest of state medicine is part of the package. Individuals are not very keen on having just the part of their life that endangers others treated for free, so there is some motivation to pay for poor people’s hip operations [epidemic risk nil] because that way you keep them in the habit of going regularly to the doctor. If you can get infections treated free, but are told a dental filling or a knee operation will cost a big chunk, most poor people will tell you to sod off, and become soured with doctors overall, which is not what we want.
We want them reguarly going in for check-ups without worrying too much about hidden charges.
that doesn’t mean we have to buy them all a CAT scanner and an artificial heart for Xmas. I’m sure Charles and I agree it is important to set limits of unpriced health care [rationing in fact] and important to explain to people repeatedly that money does not fall from the sky. But within limits I think we have a direct interest in paying sufficient taxes that we can be sure poor people are getting regular medical attention free of charge to them.