Reform should avoid front-line cuts and focus on subsidies for private privilege from the public purse, writes FINTAN O'TOOLE
ONE OF the interesting things about the current crisis is the way it highlights the manipulation of debate.
A year ago, anyone who suggested that the State should nationalise banks was self-evidently a lunatic. But even as the orthodoxy shifts, the agenda is still set by most of the same people. And those people have been able to change the subject with remarkable rapidity away from the collapse of their own assumptions and truisms and on to new ground. Like all good three-card-trick men, they know that the secret is to distract punters while you're performing the switch.
Thus, the free market capitalist system takes a dive and the big problem we have to focus on is the appalling public sector. As an exercise in logic, this is not impressive, but as an exercise in shifting the blame it is magisterial.
The problem, though, is that it takes our attention away from the real need to set priorities for public services in these hard times. Scapegoating takes the place of analysis.
This lack of analysis actually suits those who are trying to shore up the failed ideologies of the last 20 years. It suits them because analysis shows that at least some of the problems in the delivery of public services have their roots in a mechanism that is greatly cherished by right-wing orthodoxies: the application of private market incentives to public provision.
Look at the biggest mess of all - the health service. In a quietly devastating report last week, the Dáil's Public Accounts Committee showed quite clearly what lies behind the waste of public money. It is not, oddly enough, all those under-employed nurses swanning around with nothing to do. It is the construction of a system that doesn't just allow the confusion of private interests with the public good. It positively encourages it.
The simplest issue is the direct subsidy that goes from the public health system to the private health insurance market. In 2006, almost 25 per cent of public hospital beds were occupied by private patients. But the HSE recovered just 7 per cent of the cost of running the hospitals from the insurance companies. Effectively two-thirds of the cost was subsidised by the public purse.
How can this be done without provoking outrage? This is where the real genius of the system's favouring of private over public comes into play. The private system is subsidised with public money through a wonderfully Irish solution to an Irish problem. To establish what the health insurer should pay, you have to work out what the cost of the public bed actually is. But the Department of Health simply declines to do these sums. They could be done.
As the PAC points out, "information is available on the costs of every diagnosis treated within hospitals (under 660 different headings) and an analysis of these costs and the average length of hospitalisation per procedure would give a cost per day".
Instead, we have an Alice in Wonderland process. Mary Harney declares the cost to be €758 - a figure that seems to be based on nothing whatsoever. Since the insurance companies pay this arbitrary sum, we can be assured that they are paying the full economic cost. Even though we know they aren't.
The same kind of perverse pandering to private interests is obvious in at least two other areas. The current consultants' contract, which cost us €350 million plus pensions in 2006, says, according to the Department of Health, that a consultant must work at least 39 hours in the public system. At least that's clear. Or it would be if the consultants did not believe that the contract actually obliges them to work just 33 hours a week. So they're paid for 39 hours and believe they have to work 33.
The solution? Don't ask, don't tell. No one - not the department, not the HSE, not hospital management - monitors compliance with the contract. This works beautifully because everyone can go on believing what they want to believe and everyone can act surprised that, remarkably, far more private work is done in public hospitals than is allowed for under the contract. The split between public and private work is supposed to be 80/20. But you guessed it, nobody checks that either.
And then there's the little beauty called the National Treatment Purchase Fund. This was brought in as an emergency measure to clear waiting lists by paying for treatment in private hospitals. It is now fully institutionalised in all its glorious perversity. This includes the breathtaking absurdity of the State paying publicly contracted consultants private fees to treat their own public patients, in some cases even in public hospitals. Last year, nearly 20 per cent of consultants were paid by the NTPF to treat patients who were already on their own public waiting lists. Staggeringly, the NTPF actually paid for 1,774 patients who were treated in public hospitals.
So where do we start cutting money? With real front-line services for vulnerable people? Or with the perverse subsidies for private privilege from the public purse?