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Former British health minister could not be clearer: increased privatization has meant increased costs. Frank Dobson, British MP, was keynote speaker at the CUPE health care sector meeting in Victoria, British Columbia, on Thursday, October 21.

The following are excerpts from his speech.

Private care does not cost less

“The free market lobby persists in saying we must go over to a private system - as if that would miraculously make health care more affordable. But it wouldn’t, would it? It wouldn’t reduce the number of old people. It wouldn’t reduce the extra costs of new and better treatments. The only way private medicine could reduce the number of old people would be if they let people die sooner. The only way they could reduce the cost of new and better treatments would be by restricting their use to the rich and denying them to the rest of us.”

In practice, as everyone knows, private medicine pushes costs up and not down. Survey after survey shows that to be true.”

Private operations cost more

“[In the UK] we were told the private sector would reduce costs and bring about clinical innovations. After a year or two we were told that this had happened. This was simply not true. Far from reducing costs, the private providers were charging the taxpayer, on average, 11 per cent more per operation than the National Health Service [public] hospitals got for the same operation. In other words, the private sector was providing nine operations for the price of ten. They got this 11 per cent extra despite the fact that the private sector, with its limited list of elective work, was putting off the easy, straightforward, less risky operations on other wise mostly healthy patients.” 

The private sector did not reduce waiting lists; innovations in the public system did

“Waiting lists were halved under the labour government. But the supporters of privatizing parts of the NHS have the bare faces cheek to claim that it was the private sector hospitals that reduced NHS waiting times. This is a lie. The facts are that in 1998 the NHS was doing 160,000 cataract operations a year. By the time Tony Blair made his claim about the vital role of the private sector, the NHS was doing over 300,000 cataract operations a year. At the time Tony Blair made his [false] claim, the private sector had managed to do just 20,000 cataract operations - not 20,000 per year but a cumulative grand total of 20,000.”

So I hope the government of British Columbia will think twice before going ahead with funding private clinics. If the promoters of privatization start making claims about how well it has worked in Britain, you should make sure people here get the facts and not the fancy fiction.”

Administrative costs are higher in private or “market system” health care

“There is another huge problem with the new competitive market. Its worst impact is on the overall cost of the service. Before the Tory government in the 1990s introduced an internal market, the administrative costs of the NHS amounted to just 4 per cent of total costs - far lower than any other health care system in the world, far lower than any private sector health care provider and, for that matter, far lower than any supermarket chain. Now, the lowest estimate of the transaction costs of the new [market] system is 12 per cent. Some believe they are even higher.”

The British taxpayers is having to cough up that extra 8 per cent of total spending on administrative costs compared to the old [public] system. That is equivalent to an extra 13 billion Canadian dollars a year. Thirteen billion on the avoidable extra bureaucratic costs of the competitive system.”

A public system is better

“It’s our job to resist the latest attacks from the privileged and the powerful. And the best answer when they tell their lies is to spell out the truth. And the truth is that your heath care system [in Canada] isn’t just fairer than the set-up in the United States - it costs about half as much, is more efficient, less wasteful and more cost-effective. Like every other health care system in the world, yours has its problems. Contrary to the claims of its enemies, it isn’t in crisis. But it is threatened.”