Shivani Ranchod 11 March 2016
The first round of public hearings for the Competition Commission Health Market Inquiry (HMI) wrap up today. For those of us who have been obsessively following the proceedings it will be a relief to have a break before the next round. As one commentator tweeted: “Spellbound”.
It has been a fascinating series of presentations from across the private health sector: medical schemes, administrators, hospital groups, individual patients, brokers, regulators, policymakers and various practitioners groups.
If you were to read the media reports the overwhelming sense you would get is of an industry in trouble. Unsurprisingly the media have focussed on the tough questions asked by the panel and there has been a fair amount of finger pointing. The inherent tensions with stakeholders are very apparent.
The elephant in the room has been the state of public healthcare. Medical scheme cover is largely voluntary (with the exception of employers having medical scheme membership as a condition of employment). This raises this question of why the demand for private healthcare is so high – particularly given that public healthcare is seldom billed for.
Whilst the purpose of the HMI is not to put up the strengths of the industry in flashing lights the industry has certainly not done itself any favours by playing the blame game. I’ve watched many hours of the hearings, both physically in the room and via live streaming on YouTube – there are many good news stories that emerge in the detail, but those have been overwhelmed by vested interests and polarised perspectives.
One of the difficulties has been shifting between 30 000 feet and 3 feet. The HMI is largely interested in the systemic issues that affect the functioning of the industry, but to some extent their understanding of the dynamics has to be informed by the experiences of consumers or patients on the ground. For both those presenting and for the panel this means backing up anecdotal narratives and themes with hard evidence and data.
Despite having spent 15 years working in the healthcare sector I still found the questions posed by the panel challenging and revealing. It is a reminder of how important fresh eyes can be. Long-held ideas may crumble under interrogation. An example of this is the question of whether medical scheme members own schemes. There has been much questioning about scheme AGMs and why member participation is so low. Regardless of the legal structure of medical schemes, and the power members have to elect trustees, the reality on the ground is that the vast majority of members don’t have any meaningful agency or relationship with their scheme. This in turn raises the question (my question, not the panel’s) whether there is any benefit to the legal structure of schemes. Why not have for-profit entities who are able to raise capital? This in turn could alleviate the current confusion between the identity of schemes and their administrators.
The complexity of the health system has emerged clearly. For example, the panel has spent much time on the difficulties in separating out price and utilisation as cost drivers. A key question for them, given the calls for price regulation. Given the interconnected nature of the health system it is clear that the panel have to carefully consider the second order effects of any of their recommendations. Hence the careful questioning about issues like the training of doctors, and the optimal order of reforms.
The potential role of independent bodies to handle quality measurement and health technology assessment is a theme close to my heart. All of the hospital groups were asked whether they would participate in industry-wide publication of quality data. They all agreed, in principle, highlighting the importance of methodology and consistency.
Besides the interest in the actual content, there was also a lot to be learnt from the softer elements. I found it particularly interesting to observe who entities put up to represent them. The differences in the demonstrated leadership have been stark, as has the extent of preparedness. It is clear that participants were not always clear on what was expected from them. Only the more strategically astute were able to anticipate and prepare for the key issues. And as we will surely see in the media over the next few days there were some fairly major mis-steps.
We ended this first round with much discussion around the issue of regulatory effectiveness. The array of regulatory bodies and their overlapping mandates will no doubt be revisited.
The path ahead promises to be interesting. Of course, the key question is whether all of this will lead to meaningful change.
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