In phoning the Northern Territory health
department about a proposed corporatised model for health care
proposed for that territory. I encountered an old contact from 1993
when he had worked for the West Australian Health Department and
dealt with my complaint about Tenet/NME. We discussed the plan which
was already on the back burner and I subsequently wrote in regard to
some issues where I took issue with him. This is my letter.
12 April 1999
Mr xxxxxx
c/o Northern Territory Health Services
PO Box 40596
Casuarina
NT 0811
Dear xxxx,
It was good to talk to you and I found it reassuring. I enclose for your information a disk containing my last 6-8 weeks collection of health care articles. These include two on Sun Healthcare - three on nursing homes and a number on managed care and corporate misdemeanours. These may help you in your "corporate" planning. This is of course only a fragment of the information in my possession.
I make short summaries in the hope that this will induce people to read the material. They are intended to stimulate and challenge rather than be a definite assessment. I have no doubt that you will not always agree!
There is one point in our discussion I must take up. You compared the economic pressures of the casemix system in the public hospitals with corporate economic pressures. I would argue that they are very different. In the Casemix system as it was explained to me in Queensland, doctors and staff in the hospital would be strongly motivated to secure funds with which to treat their patients. They would act in the interests of their patients and would be motivated to misinform, misclassify and write notes in such a way that more money was secured. I indicated at the time that ethical doctors would respond to underfunding by manipulating the system in the interests of their patients and that the way it was set up was an invitation to do so. Doctors would then be accused of fraud. Everyone in the system is however still trying to do the best they can for patients with the resources available. No one (except government) benefit by not acting in the interests of patients. The pressures in the system are towards doing the best possible with limited resources.
Corporate systems work very differently as they exert strong pressures by incentives or coercion to either overservice or underservice depending on the particular corporate system. Corporations make money by either providing more care when they can charge for it or by not providing care when they receive a capitation fee or supply managed care. Both increase profits by cutting staff and quality as much as they can get away with. The pressures in the system are for profit at the expense of care.
I have no difficulty with patients assuming financial responsibility for their care provided those who are unable to do so are protected. I have no difficulties with genuine not for profit church and community groups whose prime focus is on providing care. I have enormous problems with groups who enter health care purely to make a profit, particularly those listed on the stock exchange who have to keep shareholders happy. The effects of competition pressures are disastrous. Rationing of care it seems is inevitable and the thought of this being done by government pressure on a corporatised health system is terrifying. Look at the nursing home industry in the USA!
I certainly favour integrated services but the sort of integration and one stop services advocated by corporations provides endless opportunities for profit generated dysfunctional practices, fraud and pressures on health providers. It has not worked. Real integration which works in the interests of patients is impossible in a competitive corporate system. It is not even efficient. The drive for profits results in expensive duplication in those situations where corporations genuinely compete. Corporate chains strive for market dominance and control which disadvantages communities when it is accomplished. There are vast expenses in administration and marketing which corporate interests seldom disclose.
I favour a model based on a cooperative system of services. Not for profit private facilities would fit readily into this model. Cooperating health services could certainly rent beds in corporate owned hospital buildings on condition that the health services provided these services and corporations did not benefit financially from the care given.
The resources however obtained could then be rationally, and hopefully also efficiently stretched for maximum humanitarian benefit, rationing fairly when it is essential.
I hope that these rather brief thought are useful to you.
I include some summaries of the files on the disk, a letter I wrote about health care rationing and the statement made by Senator John Herron which documents the end of the National Medical Enterprises saga.
The defamation action against me in Singapore which Senator Herron describes was withdrawn rapidly after Yeldham committed suicide and I asked the NSW authorities to investigate the possibility that they had exerted "improper influence" on him. When their ethics committee refused to acknowledge my complaints and supporting documents I put them on the www!
Yours sincerely,
