Health reforms must be transparent

The forthcoming Budget is expected to include measures to encourage more people to take out private health insurance policies.

Parliamentary secretary Chris Fearne has hinted that these measures will include tax rebates, but so far little or no information has been forthcoming as to how this will work in practice… fuelling concern as to how exactly this publicly-financed incentive for the insurance industry will assuage the burden of the NHS for Maltese citizens.

Talks are already under way with private insurance firms, who – in comments to this newspaper – are unsurprisingly supportive of a proposal that will incentivise more people to take out insurance policies. But concern has been expressed that the shift from public to private healthcare will be partly financed by taxpayers’ money. Another worry is that the increased demand for health insurance may also push up the price of insurance premiums.

Clearly this is a sensitive issue, and as such it is incumbent on the government to come clean on its actual intentions. This is particularly true with reference to the recurrent expenditure on health. The present government is committed in electoral pledges to retain Malta’s current free-for-all health system, even though the costs involved are known to be astronomical – at least €330 million according to the annual financial estimates, without including the health ministry’s €100 million in salaries.

Once this commitment (shared also by the Nationalist opposition) has been placed at the heart of the discussion, people are justified in questioning government initiatives which appear to be heading in a different direction.

Specific areas where more information is needed include whether the new incentives will also address present anomalies in Malta’s health insurance set-up. In 2009, former health minister John Dalli had exposed the situation whereby private insurers compensated policy-holders for treatment given out for free by public clinics and hospitals. “They push you into a bed at Mater Dei and pay you €40. Whisking people into Mater Dei is daylight robbery… we are being taken for a ride,” Dalli said at the time.

The matter was later taken up by former Nationalist MP Jean-Pierre Farrugia. “Many people are using Mater Dei Hospital despite having private healthcare insurance coverage, and they get a bonus for doing so from their insurer,” he said in 2011. “What the government should consider is to introduce its own incentives to reward people who use their health insurance to go private instead of Mater Dei.”

To date, the situation flagged by Dalli and Farrugia still applies, and can be seen to subvert the whole point of a ‘public-private partnership’ of the kind the present government appears to be contemplating. On paper, the benefit of incentivising private insurance is to lessen the strain on Malta’s only public general hospital, Mater Dei, by encouraging privately insured individuals to use private hospitals instead.

However, as can be attested by ongoing problems of overcrowding at Mater Dei, this idea is simply not working. Insurance companies not only make use of public hospitals for their clients, but even pay out insurance claims for treatment received at the taxpayer’s expense. If we are to also add tax rebates to the present system without rectifying this anomaly, this injustice will be further emphasised. The taxpayer will pay double what it is already paying for such cases; and to cap it all, the strain on public hospitals may even increase as a result.

From this perspective, it is healthy that the government intends to reform the current systems governing private insurance and their relationship with the public health sector. But it is by no means certain that the proposed reform will solve any of the existing problems. Matters are not helped by the fact that Finance Minister Edward Scicluna has flatly refused to answer questions about his government’s plans.

Some of these questions are directly related to the above concerns. Will the proposed tax rebate incentives be subject to provisos whereby privately insured persons receive their treatment only at private hospitals? If not, the proposal would only incentivise more unnecessary strain on our free health system.

Moreover it is unclear whether any distinction will be made between private citizens insured at their own expense, or company insurance policies paid for by the employer. Who will benefit from the rebate in such cases?

Another question concerns whether this measure will be introduced as a standalone policy, or in conjunction with a wider reform of the public health system. The Government has so far indicated that it favours an approach that encourages citizens to receive (insofar as possible) treatment via GPs and clinics in their own localities, to discourage the widespread culture of turning up at Mater Dei’s casualty department even for non-emergency interventions. But like the tax incentives for private insurance, it remains a mystery how this reform will be put into practice – if ever.