Free Healthcare – a context!

By Ahmed Afaal

Is there any such thing as free health care? Or is it just an attractive jargon that pleases people? Health care is a basic right for every citizen of every country and Governments are supposed to provide appropriate access to services, a statement well understood by everyone! In the recent past there has been a lot of talk about health care reform in almost all corners of the world. Health care reform becomes a major talking point of each political election. In the 1990's economists in their quest to find better and efficient ways to finance collapsing health care systems started the health care reform jargon. With advancement and sophistication in health care interventions, escalating costs left governments and the public struggling to afford health care and hence more and more people did not have access to health care, even in the developed world.

If we look at the most advanced health systems of the world for example, the United Kingdom is one that boasts "free" health care. But the National Health System (NHS) of the UK has in the recent years struggled to cope with the costs and slowly is moving towards a more market based system. Free health care is mainly seen in economies with high taxation. However even with this, there is division for example in the UK Labour Party whether to introduce a new health tax to supplement the already expensive NHS budget which stood at a staggering 53 billion pounds in 2001 (The Guardian, November 30, 2001) and keeps increasing. Who pays? The people with a tax burden of over 40% of there earnings! Do we call this 'free' health care? Most related literature state that the UK health system is on one extreme of the financing spectrum, not a very good one.

On the other extreme in the US where health care financing is based mainly on private insurance. This system has left millions without access to health care. This year the estimated number of people without insurance in the US has reached over 43 million. Why? People can't afford healthcare. No wonder, health care becomes a major campaign slogan of every American election. In the recent presidential campaign in the US, Barrack Obama proposed government subsidies on the current expensive market based system (Times, September 29, 2008) in an attempt to relieve the burden paying insurance. Also recent experience such as the bail out of insurance giants AIG shows the vulnerability of such a market. Again most literature on the subject if you read indicate that the US has one of the most regressive health care financing systems in the world.

Countries like France have made their health systems more responsive by innovation. Social Health Insurance schemes with co-payments and capitations have improved the sustenance of their systems. However, still there are questions about such systems. For example in the last election campaign of the previous Premier of Australia, John Howard in his campaign promised 'free" healthcare for all Australians. But just 3 months into his term, he raised the health care tax rate – his answer to the public? If the government implemented free health care Australia will go bankrupt and he said something along the following lines "I'm sure Australians will forgive me since my financial advisors were wrong at that time. I cannot make Australia go bankrupt just because I made an election promise" Perhaps one of the reasons his government did not last too long this time.

Coming to the context of the Maldives which is what we need to get worried about, we have a system that is extremely regressive. Out of pocket payments have made people beg for health care. Many families have gone into unrecoverable debt since they had to borrow for health care. Just like all other parts of the world, health care costs will keep on escalating. The more sophisticated the more expensive it becomes. Good financing schemes are the only solution to this phenomenon of escalating costs. Government has failed to implement a proper scheme to finance the Maldivian health system, at least in the past and so far we have to wait and see what will come up with the new Administration. One fact though is that the current political environment has made health care financing one of the major talking points.

On a positive note, slowly the concepts of insurance are creping into the country. A good sign, but how sustainable is it? We saw the first Government Employees Insurance Scheme collapse before it was really even born. A bitter experience! Now the new scheme "Madhana" is claiming that it is a more promising scheme. We have to wait and see.

Note: A first version of this article was published in Mr. Afaal's blog, http://afaal.blogspot.com. This edited version is provided to this blog for the readers of this blog.