An invited opinion piece published in "Business in Practice" (Journal of the Private Practitioners Group of the Australian Physiotherapy Association) March 2003 page 10
I was invited to express my opposition to corporatised health care and the thrust of the web pages in 600 words. This was my effort and it seems a good starting point. The rest of the web site expands on this, explains it and gives numerous examples.
The most important distinction we need to
make when debating the future of health care is the distinction
between care of the patient (not-for-profit) and care of the
shareholder (for profit). The latter abandons the Hippocratic
Health care is funded primarily by taxes or by insurance and this funding is limited. Not-for-profit care offers a cooperative system to stretch limited resources for maximum benefit. It is based on reciprocal trust and a sense of community. For-profit offers a competitive market system which stretches resources in order to care for shareholders. Those who are most successful financially prosper and those unable to compromise care for profit go under. Maintaining adequate standards in the market depends on an informed, distrustful, and empowered customer. This does not fit the majority of sick citizens. It is no coincidence that those most misused by the market have been psychiatric patients, substance abuse users, children, rehabilitation (head injuries) and the elderly in nursing homes.
Under our legal system health care professionals make the decisions about care, the care from which profits are made. Financial success therefore hangs on the ability to bend practitioners to meet the corporate mission. This is best accomplished by controlling professional income and career prospects. Lucrative contracts (golden handshakes) soon become golden handcuffs forcing compliance. The pressures may be to over service (providers) or under service (managed care).
For-profit providers and economic theorists may start with the best intentions and will angrily reject this analysis. Corporations are ultimately dependent on the share market for survival and the market is unforgiving. Competitive pressures ensure that those who exploit the funding system and reduce costs to levels which compromise care succeed. Those who fail to do so are taken over and restructured. Institutional investors (managed funds, pensions etc) greatly outnumber individual investors. Their prime responsibility is to increase value for their members and their frames of understanding are entirely market based. They have the power to force out directors and managers of nonconforming companies. They insist on the exploitation of the market for the benefit of their members. These members do not know where their funds are invested and have no control over what is done on their behalf.
Decisions which profoundly effect the care given to patients are made in the board room. Nursing care for example is critical in aged care. Sun Healthcare adopted a policy of "cutting the fat" by reducing the quantity and quality of nursing staff. It built its vast US empire by exploiting the rehabilitation opportunities presented by post acute care - paid for by item of service. They recruited therapists from around the world. When the funding system was changed to stop rorting the "demand" for therapy miraculously evaporated. Sun fired 1000 therapists.
As the market matures competitive pressures increasingly force compliance. The only mature health care market in the world is that in the USA. It is no coincidence that health care fraud is now the justice departments largest headache. The biggest and most successful companies in each health care sector have made the largest fraud settlements, been at the centre of allegations of poor care, or been the focus of a public outcry. Columbia/HCA has recently reached a record A$3 billion fraud settlement. By 1995 Tenet Healthcare had paid over A$1 billion to settle fraud and quality of care suits. It entered into integrity agreements and accepted court injunctions restraining its practices. In 2003 it is again being prosecuted for alleged fraud. Once again doctors in its hospitals are accused of carrying out invasive procedures when they are not indicated. Share market pressures are irresistible and repeated attempts to control aberrant practices over 20 years have failed.
The three companies mentioned have all tried to enter the Australian market but their US misconduct rendered them unacceptable. Proposed international trade agreements at the Word Trade Organisation will compromise our ability to keep dysfunctional companies out of Australia in the future.
For more information see http://www.bmartin.cc/dissent/documents/health
J Michael Wynne