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Chapter 5 | The impact of the crisis on the health system and health in Ireland 165 their choice, including a public option. The assumption is that private insurers operating in the PHI market will compete with a public entity to offer statutory coverage. It is questionable whether a competitive insurance system will help to improve efficiency and control costs. The experience of insurer competition in Germany, the Netherlands and Switzerland suggests that such systems have not been effective in health care cost control (Westert et al., 2010; Maarse & Paulus, 2011; Schut and van de Ven, 2011; Busse & Blümel, 2014). The Programme for Government sets out an ambitious range of reforms for the Irish health system. This involves the introduction of free GP care and universal health insurance, ostensibly all by 2016. In this regard, the economic crisis has helped to highlight the need for reform in the system, which was largely ignored in the pre-crisis period. The crisis has also reduced opposition to change (O'Riordan & Thomas, 2010) as can be seen most clearly by the implementation of the Public Service Agreements and the acceptance by stakeholders of the broad range of initiatives to cut costs around human resources and pharmaceuticals. The ultimate aim of Irish and international health policy is to improve population health (Department of Health and Children, 2001b). In this regard, it is important to analyse the extent to which the economic crisis, and health system responses, have impacted on population health. Impacts on general population health are difficult to identify at this stage of the crisis because of the time lag in effects, although some initial health impacts have been identified in the Irish context, particularly in terms of mental health outcomes, as detailed above. 5.3 Implementation challenges Despite the acknowledgement of the need for changes, the continued austerity seems now to be working against reform. In 2013, the first steps to free GP care were postponed. Further delays in implementing policy may well be likely as the health system battles to continue to provide quality care with shrinking budgets and demographic pressures. In addition, it is unlikely that capacity can be expanded sufficiently to cope with the effects of removing price barriers to care without an injection of more funds and resources into the system (Thomas, Normand & Smith, 2008). Perhaps of even greater concern is the slow erosion of public health entitlements and increase in co-payments that has occurred throughout the crisis. The creation of increased barriers to accessing pharmaceuticals through higher copayments is of particular concern. Developments such as these raise questions about the extent to which the principle of “a universal, single-tier health service, which guarantees access to medical care based on need, not income” is being implemented in the current climate.
166 Economic crisis, health systems and health in Europe: country experience 5.4 Resilience in response to the crisis Beyond the substantive issues outlined above, some reflection is possible at this early stage of analysis. Interviews with senior health system decision-makers (carried out as part of a wider project on resilience in the Irish health system) provide some important insights. 6 As mentioned above, the core driver of change throughout the crisis has been the requirement for fiscal consolidation. Interviewees reflected that, “the financial requirements and the economic sovereignty of the country is taking precedent now”. The bailout agreement with the Troika (which ran to the end of 2013) framed this consolidation: “the arrangement with our partners as we call them, the EU/IMF and the ECB [the Troika] is ruling our policy approach”. In the years before the crisis, the health system was largely in development mode. Interviewees noted, though, a lack of strategic thinking during this time, “in the period, say from 1997 to 2008, the solution to most problems, including health, was to throw money at the problem”. The crisis, and by implication the cost-cutting that has followed, was considered an opportunity to address what interviewees considered to be an over-resourcing of the system during the years of budgetary surplus: “in terms of strategic development the fact that we are in such huge economic and financial difficulty means that people are likely to be far more open to looking at alternative major reforms in health care than they would have been previously”. The influence of the Troika has “allowed or forced the political system to make more unpalatable decisions than they otherwise would have made”. The health system reform policy itself may be considered another important driver of change as, at least in principle it is framing decisions being made. Nonetheless, implementation is fraught with a range of challenges, both organizational and political. These include, among others, stakeholder resistance, system complexity and pressure for reform in other sectors, which diffuses the focus on health. In effect, the economic crisis is forcing fiscal consolidation decisions, such as increased OOP payments, which seem to undermine the global policy drive towards universality for example. Despite negative effects of the crisis, such as a reduction in health funding, less access to health care and less coverage, interviewees noted that “managing with less” has resulted in greater system efficiency and productivity. This trend seems now to have reached its limit, however, as the crisis is sustained and further rationalization becomes more difficult. Within these parameters, a tentative sequence has been identified whereby the first phase response of the 6 This section draws heavily on interviews with senior health system decision-makers in Ireland as part of the HRB-funded project "Resilience of the Irish health system: surviving and utilising the economic contraction". Further details on the methodology for the qualitative component of the research are available from Health Policy and Management (2013). See also Thomas et al. (2013).
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Chapter 5 | The impact of the <strong>crisis</strong> on the <strong>health</strong> system <strong>and</strong> <strong>health</strong> in Irel<strong>and</strong><br />
165<br />
their choice, including a public option. The assumption is that private insurers<br />
operating in the PHI market will compete with a public entity to offer statutory<br />
coverage. It is questionable whether a competitive insurance system will help<br />
to improve efficiency <strong>and</strong> control costs. The experience of insurer competition<br />
in Germany, the Netherl<strong>and</strong>s <strong>and</strong> Switzerl<strong>and</strong> suggests that such <strong>systems</strong> have<br />
not been effective in <strong>health</strong> care cost control (Westert et al., 2010; Maarse &<br />
Paulus, 2011; Schut <strong>and</strong> van de Ven, 2011; Busse & Blümel, 2014).<br />
The Programme for Government sets out an ambitious range of reforms for<br />
the Irish <strong>health</strong> system. This involves the introduction of free GP care <strong>and</strong><br />
universal <strong>health</strong> insurance, ostensibly all by 2016. In this regard, the <strong>economic</strong><br />
<strong>crisis</strong> has helped to highlight the need for reform in the system, which was<br />
largely ignored in the pre-<strong>crisis</strong> period. The <strong>crisis</strong> has also reduced opposition<br />
to change (O'Riordan & Thomas, 2010) as can be seen most clearly by the<br />
implementation of the Public Service Agreements <strong>and</strong> the acceptance by<br />
stakeholders of the broad range of initiatives to cut costs around human<br />
resources <strong>and</strong> pharmaceuticals.<br />
The ultimate aim of Irish <strong>and</strong> international <strong>health</strong> policy is to improve population<br />
<strong>health</strong> (Department of Health <strong>and</strong> Children, 2001b). In this regard, it is<br />
important to analyse the extent to which the <strong>economic</strong> <strong>crisis</strong>, <strong>and</strong> <strong>health</strong> system<br />
responses, have impacted on population <strong>health</strong>. Impacts on general population<br />
<strong>health</strong> are difficult to identify at this stage of the <strong>crisis</strong> because of the time lag<br />
in effects, although some initial <strong>health</strong> impacts have been identified in the Irish<br />
context, particularly in terms of mental <strong>health</strong> outcomes, as detailed above.<br />
5.3 Implementation challenges<br />
Despite the acknowledgement of the need for changes, the continued austerity<br />
seems now to be working against reform. In 2013, the first steps to free GP<br />
care were postponed. Further delays in implementing policy may well be likely<br />
as the <strong>health</strong> system battles to continue to provide quality care with shrinking<br />
budgets <strong>and</strong> demographic pressures. In addition, it is unlikely that capacity can<br />
be exp<strong>and</strong>ed sufficiently to cope with the effects of removing price barriers to<br />
care without an injection of more funds <strong>and</strong> resources into the system (Thomas,<br />
Norm<strong>and</strong> & Smith, 2008).<br />
Perhaps of even greater concern is the slow erosion of public <strong>health</strong> entitlements<br />
<strong>and</strong> increase in co-payments that has occurred throughout the <strong>crisis</strong>. The<br />
creation of increased barriers to accessing pharmaceuticals through higher copayments<br />
is of particular concern. Developments such as these raise questions<br />
about the extent to which the principle of “a universal, single-tier <strong>health</strong> service,<br />
which guarantees access to medical care based on need, not income” is being<br />
implemented in the current climate.