Learning from the Irish Water experience

Our health services may, in time, benefit from the negative experience of Irish Water, which has become one of the most politically and socially divisive issues of recent years, writes Mr Denis Doherty.

Denis Doherty
Mr Denis Doherty

Our health services may, in time, benefit from the negative experience of Irish Water! What could have been a success story has turned out to be a fiasco. Little of the blame for that attaches to the new company. Imposed by the now departed troika, the intention was laudable. Water conservation would be incentivised and a new revenue stream would be created. The reality is very different. The project has become one of the most politically and socially divisive issues of recent years.

So far, a huge capital investment has been made in installing water meters that don’t serve any useful purpose and are unlikely to anytime soon. A flat charge has been substituted for metered bills, thereby removing any incentive to conserve water. And worse, an administrative monster has been created to collect a modest income relative to what was planned when the project was initiated.

The terms UHI and Universal Healthcare have been used interchangeably. They are not two sides of the same coin, as is sometimes suggested.

Every household must register with Irish Water. With a sense of the absurd, the Department of Social Protection will then pay what they describe as a Water Conservation Grant of €100 to every household by way of reward for registering with Irish Water. It’s not even necessary to pay the fixed charge to qualify for this grant. There is legal provision to obtain attachment orders to the income of those who don’t pay, but we are assured there isn’t any likelihood of that happening for at least another two years. I bet the ‘Yes Minister’ scriptwriters would have rejected a suggestion for a scheme like that as being utterly implausible, even by their standards.

UHI (Universal Health Insurance) has the potential to make the Irish Water experience look like an example of efficiency. From the time UHI, using a version of the Dutch model, was first mooted here confusion has reined. The terms UHI and Universal Healthcare have been used interchangeably. They are not two sides of the same coin, as is sometimes suggested. For example, the NHS is a universal healthcare system that is funded from general taxation. There is a private healthcare option in Britain but it is availed of by only about 10% of the population. Waiting lists in the NHS are modest by our standards, so there isn’t any need to take out private insurance in order to jump the queues.

From what we have been told so far of the structures that will underpin UHI, it has the potential to give rise to high transaction costs and generate profits for private insurers.

UHI is portrayed here as a way of dismantling our two tier system by making everyone a private patient. That notion may be politically appealing at a superficial level but soon people will want to know what services will be covered; will services be more accessible than they are now; will service quality be improved; how much will UHI cost and how will health services not covered by the UHI package be paid for?

Long waiting lists for outpatient appointments and elective treatment is a growing concern. That situation is contributed to by the fact that we have fewer Specialists (Consultants) than other OECD countries. UHI will not solve that problem, implementation of the Hanly Report will and may also do more to bring about a single tier system than UHI is likely to do.

The Netherlands is not the country to look to when seeking out a cost effective, high quality healthcare system that enjoys a high level of user satisfaction

From what we have been told so far of the structures that will underpin UHI, it has the potential to give rise to high transaction costs and generate profits for private insurers, all of whom will have to offer the same level of cover, within prescribed cost limits. Maximum premium rates will be set by a new entity, The Healthcare Pricing Office. In circumstances like that, shareholders needs for a return on their investment, tend to get met by growing volume and driving down costs. Quality improvement may not be a priority in that type of environment.

It all sounds like a variation of the virtual market invented by Margaret Thatcher, a big difference being that for-profit insurers will play a big role here. The Dutch model is an unashamedly market based one with only an arms length role played by the government there. What’s mooted for Ireland is a State designed and State controlled healthcare funding system that is not based on any tried, trusted or affordable system elsewhere. That’s what conjures up the spectre of the Irish Water experience. An Irish solution to a global problem!

At this point, there is less clarity about UHI than there was about Irish Water when that entity was set up. From what we know, UHC has the potential to be at least as bureaucratic as the systems that have resulted from political decisions that have been made in relation to Irish Water, with what appears to be scant regard for the transaction costs to which they give rise.

Would it not make much more sense to decide what type of healthcare system we need and can afford? Having answered that question, would that not be the appropriate time to consider and decide what method of payment would be most appropriate and acceptable to the Irish people?