For An Obamacare Preview, Look To England

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LONDON- British newspapers are filled with the pros and cons of the National Health Service, which provides free or heavily subsidized care to all registered residents. The latest story is that British hospital emergency room visits are rising, from 18 million in 2005 to 22 million in 2012. That's an increase of 22 percent in 7 years, far above the population increase of 4 percent.

Higher emergency room use is relevant to America, because supporters of the Affordable Care Act often justify its passage on the grounds that it will reduce the number of hospital emergency room visits, thereby lowering the national costs of health care.

Not so in Britain. On Thursday Jeremy Hunt, the U.K.'s Health Secretary, warned that the increase in emergency room visits posed the "biggest operational challenge" to the NHS.

In 2004, under the previous Labor government, family doctors, known as general practitioners, or GPs, were allowed to opt out of providing after-hours coverage. So more patients who need help after hours, especially those with chronic conditions, began go to the emergency rooms.
Dr Kailash Chand, deputy chairman of the British Medical Association, responded, "I believe health secretary Jeremy Hunt's recent speech is ill advised to say the least...He has to accept that the ever increasing squeeze of funding to GP practices and the wider NHS, coupled with the impact of coping with an aging population and spiralling patient demand has left the NHS facing unprecedented pressures."

If squeezed physicians, an aging population, and spiraling patient demand sound familiar, that's because America has the same problems, problems which the new Affordable Care Act is supposed to solve. But looks like Britain, with its single payer health service, faces the same unsolved challenges.

The truth is that in single-payer Britain long waits for non-emergency visits are common, and even scheduled surgeries, arranged months in advance, can be postponed without warning for lack of a piece of medical equipment.
It has become increasingly difficult scheduling a regular visit with a GP in Britain. Many GPs are booked up weeks in advance. Patients can see their doctor promptly if they call early in the day and say their problem is an emergency, entitling them to be seen in one of a limited number of emergency appointments on the same day.

GPs are also gatekeepers to specialist services: no GP referral, no specialist appointment. Last week London's Daily Telegraph published an article about Becky Ryder who was refused a cervical cancer screening test at age 24 despite showing symptoms of the disease. The NHS only allows tests for those 25 and older. Ryder died of cervical cancer when she was 26.

The implementation of America's Affordable Care Act will not fully alleviate the pressure on emergency rooms, just as it has not done in Britain. Under the Affordable Care Act, visits for preventive care will be free of charge, likely leading to the same kinds of rationing.

Some Americans will visit emergency rooms because they will chose to stay uninsured. Payment of a tax of $95 in 2014, $325 in 2015, and $695 in 2016 and thereafter, will make an appealing alternative to the Internal Revenue Service's estimated $20,000 insurance premiums for a family plan in 2016. Also, since under the ACA people will be able to sign up for insurance during open enrollment periods, they can skip insurance until they get sick.

Others will visit emergency rooms because they won't be able to afford insurance. Those earning under 400 percent of the poverty line are supposed to receive a federal subsidy to buy health insurance on the exchanges - but there's a loophole. Employers are required to offer affordable single coverage, not affordable family coverage. And if one member of a family gets affordable single coverage from his employer, he's required to take it. According to the law, this means that no family members can qualify for subsidized insurance on the exchange. The New York Times has called this a "glitch" in the new system. Recent IRS regulations waived the penalty on those who don't have coverage, but didn't fix the glitch, leaving millions uninsured.

These two groups of people will end up in emergency rooms or community centers for their care. CBO estimates that in 2014 there will be 44 million uninsured, and when ACA is fully phased in, in 2023, there will still be 30 million people uninsured. Undocumented workers won't have access to the health exchanges, but they will be able to be treated at community centers.

In Britain, some escape the National Health Service waiting periods through private insurance and private hospitals, with no waits and a choice of top-quality specialists. The largest private insurance company is BUPA, and private health insurance is a valued employment benefit.

BUPA, as well as insurance, also offers "self-pay" physician services to those whom it does not insure, but who want to escape the predictably long waits of the NHS. Prices for a "self-pay" GP appointment range from $105 for a 15-minute consultation to $350 for an hour. BUPA also offers cosmetic treatments ($93 for microdermabrasion for the face, $308 for a wrinkle injection.

I was privileged to see the private Wellington Hospital, near Lord's Cricket Grounds in northwest London, not as a patient, but as a visitor. Rooms are like a hotel, with mini refrigerators, armchairs, and couches. Nurses offer cups of tea in real china cups and saucers. In the lobby, newspapers are in English and in Arabic, since many Arabs, both living in London and abroad, come to the Wellington for private care.

Britain's experience suggests that the Affordable Care Act may result in the development of parallel private initiatives. America already has concierge medical services for the rich and walk-in clinics for the poor in drugstores such as CVS and Walgreen's. Americans are likely to seek a way out of lengthy waits for doctors and specialists. The free market may come to the rescue, just as it has in Britain.

Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is senior fellow and director of Economics21 at the Manhattan Institute. Follow her on Twitter: @FurchtgottRoth.   

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