When the market becomes deadly - Privatisation and the Pandemic (CEO Report)

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This report from Corporate Europe Observatory (CEO) exposes how pressures towards privatisation of health and long-term care put Europe on a poor footing for a pandemic

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From hospitals to care homes, the evidence is mounting that outsourcing and private provision of healthcare has significantly degraded EU member states’ capacity to deal effectively with COVID-19. The EU must reject the private sector lobbyists now whispering in its ear, and reverse course on the kind of economic governance which has accelerated healthcare liberalisation, instead putting public provision at the centre of its strategy. If it doesn’t, more lives will be at stake.

Download the full report.

As COVID-19 swept the globe, with over 2 6 million cases and 466,000 deaths in the European region alone (as of 11 January ) , the capacity of healthcare systems to deal with the pandemic has been constantly in the spotlight. Long-term and elderly care provision has also come under scrutiny, as shocking proportions of COVID-19 deaths have occurred in residential care homes in many European countries – up to 60 per cent in the pandemic’s first wave.

EU member states’ health systems – both those based on employment-related health insurance and those financed via general taxation – have been subject to political and policy pressures that have encouraged the creeping privatisation of healthcare. In 2017 Corporate Europe Observatory lifted the lid on the ideological, corporate, and financial pressures – including from the EU-level – that have created conditions conducive to a growing role for private sector companies in this traditionally public service.

But squeezing profits for shareholders out of health and care services comes with risks: deteriorating working conditions, worse pay, reduced staff levels, greater workloads, more stress, and shortcuts in training and protective equipment, all of which affect safety and quality of care. Health inequality is exacerbated as private, for-profit providers ‘cherry-pick’ lower-risk and paying patients, whilst higher-risk and poorer patients, or those needing emergency care, remain reliant on public health service provision, which – due to austerity, and the increasing capture of public funds by for-profit providers – is badly under-resourced.

In the context of COVID-19, these trends have had disastrous implications for health and care systems’ ability to handle the pandemic. Health budget cuts have led to understaffing and reduced total hospital bed numbers, while the rise of private hospitals goes hand in hand with a fall in intensive care beds, which are less profitable for companies. Profit-oriented care homes have kept their costs down by hiring too few staff, who are often poorly paid, inadequately trained, little or no sick-pay, and with no option but casual work at multiple facilities, contributing to the virus’ spread.

Yet it hasn’t always been this way, and it does not have to be. The shifts that have led to greater privatisation of healthcare, the casualisation of care work, and the erosion and underfunding of the public sector are the result of political decisions at national and European levels. For many people shocked by the state of these sectors when the pandemic hit, these shifts have slipped by largely unnoticed. COVID-19 has been a wake-up call for many, a reminder that we have a choice in how our vital public services are run. This article considers both the EU policy pressures and the corporate lobbying that has promoted increased marketisation, commercialisation and privatisation of healthcare. Trends which contributed to health and elderly care systems in Europe being poorly prepared for the pandemic. Some of our key findings include:

  • The private hospital lobby is prolific in Brussels, using the pandemic as an opportunity to push its interests. Meanwhile, analysis shows healthcare privatisation has reduced countries’ long-term preparedness for dealing with pandemics, and actually costs governments more than public healthcare.

  • EU pressures to cut public spending have contributed to the commercialisation of the elderly care sector, as well as the healthcare sector, with catastrophic effects during COVID-19, particularly in care homes.

  • The evidence against public-private partnerships in health is mounting, but a mindset shift is still needed. However, such a shift is unlikely if the Commission accepts help from firms like McKinsey (known for its role in increasing the privatisation of the UK’s NHS) in its COVID-19 crisis response, while keeping the public in the dark about the details.

  • COVID-19 is a clear example of the failures of the privatised model of healthcare and long-term care provision. The fight against this model is a fight for patients and workers, for the elderly and disabled, for justice, equity, and human rights. As plans for a European Health Union get under way, it is vital to safeguard the public not-for-profit nature of healthcare provision in Europe, and ensure that COVID-19 recovery funds are not siphoned off to for-profit providers.

Download the full report.

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