A healthcare utopia…the impossible dream. Part 1.

First Published: 2003-12-19

Following is part one of the text of a speech written by Rick Lowe and Joan Thompson, Directors of The Nassau Institute, delivered to the Abaco Chamber of Commerce on Thursday, December 11, 2003 titled, A Healthcare Utopia…the impossible dream.

"What has always made the state a hell on earth has been precisely that man has tried to make it his heaven." – F. Hoelderlin.

This observation by Freiderich Hoelderlin, an eighteenth century German poet, is the opening quote to chapter 2 of F.A. Hayek's great work The Road to Serfdom. The socialisation or nationalisation of healthcare, as proposed by the government's Blue Ribbon Commission on National Health Insurance, is another Utopian ideal that if implemented becomes one more step on the road to Socialism, ending in serfdom.

No one should doubt the sincerity of Dr. Perry Gomez, Chairman of this Commission, and his concern for the well being of Bahamians. He is to be commended for his work on AIDS that has helped so many in our country extend their lives when faced with the prospect of an early death as a result of that dreaded disease.

However, before we discuss the proposed socialised healthcare scheme, we should take a few minutes to think about the country's National Insurance programme, which was the first payroll tax imposed on the Bahamian people, with promises of income for retirement and other needs. According to press reports, the National Insurance scheme is expected to be bankrupt in a few short years, barring dramatic changes to benefits and the current contribution rates.

While the government Minister responsible for National Insurance has explained they are over staffed and do not expect a reasonable return on their investments, they somehow forget to mention how our funds are used to erect buildings for the government without specified repayment terms.

In other words, those people that have contributed all their working lives should not expect to receive a pension from the Ponzi scheme known as the National Insurance Board.

Let's digress for a moment here to explain what is meant by a Ponzi scheme.

Oxford defines it as:

"A form of fraud in which belief in the success of a non-existent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors."

Under The National Insurance scheme, while it exists in the form of buildings and employees among other things, the money paid out to retirees today, comes from the money working people pay in today. So as our population ages…returns decline and government borrows more money for buildings it doesn't intend to repay…bankruptcy is inevitable

Bankruptcy, of course, is the inevitable end for a Socialised Health Insurance scheme as well.

Here's why.

The Blue Ribbon Commission notes their "scheme" will remove our personal responsibility of having to pay directly for our health needs, because, they will do it for us. It also guarantees that everyone will be served…equally. Once the "scheme" is established, every worker will be taxed to pay for it, and there's no opting out because the government has the power to force each of us to pay under the threat of fines, jail or both.

We have been, and will continue to be fed a diet of heart wrenching stories about people arranging cookouts to pay medical expenses. Theoretically our consent to a Socialised healthcare scheme is sought through town meetings and other presentations. But, this "consent" is achieved by convincing the public that there are large numbers of individuals suffering without medical care.

As we know, no one is denied healthcare at the Princess Margaret Hospital if you are rich or poor. Of course the service might not be what we want, but you will be attended to.

Another intention is to convince us that the majority of people are denied health insurance by private providers or mean employers. Well, anecdotal evidence, from a few private employers, suggests that many people are offered the opportunity to purchase group insurance through their employer, but decide not to, having other uses for the money or simply trusting that God or the government will provide.

As one lady put it on Love 97's call in program Issues of the Day in early October: the same people that are holding the cookouts because they can not or will not pay for health insurance coverage are the ones that have cellular telephones and all the other conveniences of modern life, but do not wish to protect themselves by purchasing health insurance.

Rather than encouraging dependency, the leadership in this country ought to promote personal responsibility…not the irresponsible notion…that some one else will pay.

When it comes to paying for the cost of care, is there any reason…or evidence…to believe that Socialised healthcare will be managed any different than other government-run programs?

One certainty on which we can count, and which is characteristic of all government-run operations, is there will be waste and no accountability. Private businesses that waste resources generally become unprofitable and do not survive. In contrast, government can, and will utilise its power to tax people in order to continue their programs, no matter what the cost.

The Blue Ribbon Commission refers to a "stable financing mechanism" to guarantee services, that will not be affected by changes in the Bahamian economy. In plain English this means coercive taxation, because it presupposes an economy that will always be stable. And we know that there will always be fluctuations in the economy. This financing mechanism, known as Socialised healthcare, will reportedly provide sustained income to expand the services offered, purchase new equipment and build more operating rooms.

Of course, there is no mention of means testing of those being treated at the public hospital so those that can pay will be made to do so, or to improve the present system to make it more efficient.

User fees, commensurate with costs, are also a technique to promote a more "economical" use of medical resources and public funds. In their minds however, there is a need for more funding for the government healthcare system. So the only alternative the Commission sees is to make every citizen pay for the abuse!

In addition, there has been no data released regarding the work of the 15-member Blue Ribbon Commission that has been going on for some 18 – 20 months now. While we have seen fist fulls of public relations documents, there has not been a shred of analytical material.

This begs a few questions like:

1. What it costs to implement this Socialised Healthcare scheme, and

2. What citizens and businesses will be forced to pay for the government to "help us", and

3. How healthcare professionals will be affected?

Obviously, doctors and other healthcare professionals will become state employees, subject to the decisions of a government Health Minister as to what they would be paid and possibly down to hours of work. And of course they will have a guaranteed income. Our guess is that the majority of physicians will not willingly relinquish the freedom they now enjoy for a life under the thumb of a government bureaucrat. Nor would we expect the quality of care to be any better once they become state employees.

Our further guess is that even though the doctors would be reluctant to admit it, we should not expect the same dedication to their work once the incentives and freedoms they enjoy today are taken away?

Of course, there will be healthcare professionals who like the idea of a Socialised scheme, however, the long-term reality in many government healthcare systems around the world, is the shattered dreams of many of the healthcare professionals and patients confined to such a system

In the era after World War 2, when nationalisation of so-called essential services was in vogue, nationalised industries were thought to be more efficient, more equitable, more available, and guaranteed. We must ask what happened to "economies of scale" and the additional benefits government promised to provide that the private market could not. Fifty years later we know that people were misled, just as Bahamians are being misled now with promises that will not be fulfilled.

As the country is apparently using the Canadian healthcare system as a benchmark, the research of other independent "think tanks" like the Fraser Institute, and the National Center for Policy Analysis, have shown through rigorous research that there are huge unresolved problems, that worsen each year.

The Fraser Institute study of August 2002 revealed:

1. Canada has the most expensive healthcare system among the 26 industrialized nations that have comprehensive, universal access.

2. Canada has one of the poorest endowments of physicians in the OECD. It ranks 17 out of 20 countries with only 1.8 doctors per 1,000 people.

3. Canada bans private healthcare…except for politicians and senior bureaucrats of course.

4. Canada ranks 18th in access to MRI's; 17th in access to CT scanners; 8th in access to radiation machines; and 13th in access to lithotripters. This equates to average waiting times of 17.5 weeks. Unfortunately it is worsening each year.

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