Is Ireland a low taxation economy?

paying for health care

This morning on the radio interviewer asked hospital consultant what doctors' feelings were on accusation they were 'breaking contract' by using public health service facilities to treat their private patients. Consultant's response was that the statistics were deceptive as privately-treated patients 'spent only a short time in hospital'......implicit in the dialogue was that (a) there was no difficulty transferring to rehab nursing care/residential care for privately-treated patients and (b) that privately-treated - aka 'wealthier' - patients were in better general health which reduced their use of the service.

This is flawed logic! An elderly friend (self-professed socialist!) tired of waiting on NHS waiting-list (UK) did some internet research and enquiry and had his back-operation done in Malta by a world-renowned surgeon. It was cheaper than NHS private treatment (even counting in his flight and hotel accommodation). This man had been in extreme pain for two years and his gait was so badly affected it was having a knock-on-effect on other joints (knees etc).

However I have another friend - a Maltese living in the UK - who expressed his disgust at 'health tourism' pointing out that those now flocking to India for cataract removal procedures or in this case, Malta, or to Budapest actually create longer waiting-lists and more deprived conditions for the indigenous populations of the 'health tourism'.

Health tourism is a logical extension of the two-tier private/public system insofar as the investment of public funds (for the equipment in operating theatres, the infrastructure, bureaucracy etc, especially the expensive state-funded education of doctors, nurses and professions allied to medicine) are used for 'private' healthcare; so the state subsidy is skewed to benefit the more educated, more informed, wealthier strata of society. THIS is the invidiousness of the system!

Any suggestions on how requisite health care could be accessible to all according to need not wealth/influence?

Re: Health Care

sean, like i said 40% of the population have completely
free health care as they are covered by the medical card
system. i don't see what benefit there is to spending welfare
money on the other 60%. it it nonsense to suggest that
the poor would benefit from universally free health care.
at best they would be no worse off than they are at the
moment. how would the relatively poor who are on medical
cards benefit from your suggestion?

that the health care system is badly run in this country is
a given. but i fail to see how making gp visits, etc. free for
relatively well off people will improve the health service.

.

The percentage of the population which has a medical card is made up of those of 70 years old and over, children, the unemployed, those unable to work for medical reasons etc.

The criteria I previously stated for obtaining a medical card for anyone else is valid. So, for anyone who works they effectively do have to be in poverty to obtain one.

BTW, I don't want anyone thinking I'm some raving socialist, as I am a business owner. I simply think it is unfair that those on low income pay such a large proportion of their income on health as opposed to those of us who are better off, and pay a much lower percentage.

So maybe not universally free, I have by no means examined this in any great detail. But, IMHO the criteria for obtaining a medical card for those who work should be raised well in excess of where it is now. I don't think it would be unreasonable for anyone earning €30,000 or less to obtain one.

Re: Health Care

Marie,
The vast majority of people who pay for VHI are employed and pay taxes. They pay for the public health care system. Then they pay extra for private health care. There is a tax incentive to do so, as the public health system receives an additional income from their insurer when these people use hospital services. The state would be considerably worse off if these individuals did not "pay twice" for their health care.

tedd

Re: .

Hi Tedd - Isn't this a bit of an over-simplification?

Semi-private/private patients aren't generally paying twice for the same service. They may well be getting the same medical service (just ignoring the issue of who delivers the service for the moment, i.e. consultant or registrar or ....), but semi-private/private patients are paying extra for the extra space/privacy/crockery/food that comes with the semi-private or private room.

If there was a mass exit from VHI/BUPA and those people were all suddenly dependant on the public health service, then sure, the system would definitely be overloaded and the state would be worse off.

But if there was a mass exit from VHI/BUPA and those people all moved out to private hosipitals (just ignoring the capacity issue for the moment), then surely that state would be better off, and public patients would get treated more quickly?

Re: Health Care

Semi-private/private patients are indeed paying twice for the same thing every time they occupy a public bed in a hospital - if you visit a "private" patient in hospital, there is a good chance they will be in a public ward, often by their own choice.

Re: .

In many cases people who are entitled to semi-private or private ACCOMMODATION (the medical care will be exactly the same) under their private health insurance cover or whatever will end up on the public wards anyway because such entitlements are subject to limited availability. There is often no choice involved at all. People who pay for private health insurance because they want semi-private/private accommodation should bear this in mind. I suppose the other main reason that people take out private health insurance is to avoid waiting lists for elective procedures.

Re: .

A person on the minimum wage in Ireland must Pay BOTH Tax and their healthcare costs.

The fact that minimum wage workers are in the tax net is incredible. The fact that even then they are not entitled to a medical card is criminal.

Talking about what percntage of the population are entitled is meaningless. There are people in this country who literally cannot afford to get sick. Worse, they are paying through tax for the health care of others who are better off than them.

I'm not a raving socialist either. Some things are just wrong regardless of where you sit in the political spectrum, and no statistics make them right.

-Rd

public funding of private healthcare

This does not add up! The cost of bureaucratic infrastructure, roads and transportation system, general medical/specialist medical, dental, nurse and professions-allied-to-medicine training, land, buildings, equipment, consumables and utilities of "the healthcare system" (or simply, "the hospital") are all borne by "the state"/"the" taxpayer (it doesn't matter for the moment how much the eponymous taxpayer contributes).

The "private patient", like the "public patient", taps into all this when she has her procedure. The VHI/BUPA/private scheme insurance does not buy medical care/treatment/swish accommodation! What it buys is privileged ACCESS!

If the terms of the debate were made clearer decisions on optimal healthcare delivery would be easier.

Re: .

The fact that minimum wage workers are in the tax net is incredible. The fact that even then they are not entitled to a medical card is criminal.

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So where do you draw the line then?

A single minimum wage earner (52 weeks x 40 hours x €7.00 per hour = €14,560 p.a.) pays a maximum of €352 in tax and €318.32 in class A PRSI for the year by the way.

Re: public funding of private healthcare

daltonr, numbers and statistics are what separates
opinions from fact. i disagree that they are meaningless.
i doubt you could produce figures to back up your gloomy
picture of hoards of minimum wage earners dying from lack
of health care because they can't afford it.

0 has gotten in ahead of me somewhat but i think the
calculated salary is a little high. on average, there are about
220 working days in the year so a minimum wage worker
will earn about 12,300. i've put this salary figure in the
online tax calculator and the tax liability for this salary
is zero. so such a person is not "paying for the health care of
others who are better off than them".

secondly your claim that such people cannot afford to get
sick doesn't really stand up either. non-elective hospital care
in the country is free and the balance of prescription costs
over a lowish threshold (70 euro a month?) are also paid for.
even if you have to visit a gp 10 times in a year, this would
cost around 3% of the minimum wage salary. finally, in
extreme cases, the health boards can and do step in with
financial support.

VAT and PRSI

Is VAT and PRSI completely seperate?
Does VAT find it's way into Public secotor salaries for Health workers.

On Des Bishop work experience he was complaining that even on just above minimum wage he had already started to pay tax.

Re: public funding of private healthcare

0 has gotten in ahead of me somewhat but i think the
calculated salary is a little high. on average, there are about
220 working days in the year so a minimum wage worker

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I wasn't sure about how to calculate the annualised min. wage so used the 52 weeks x 40 hours x €7 approach. Perhaps the 220 days x 8 hours x €7 approach is more accurate?

Is VAT and PRSI completely seperate?

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What do you mean? VAT is charged on certain (most) goods and services - not most staple/essential foodstuffs though. PRSI/health levy are deducted from income. They are completely separate in this respect. Maybe you mean something else?

On Des Bishop work experience he was complaining that even on just above minimum wage he had already started to pay tax.

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I wonder what his "minimum wage" figure was? Did he mention it? I can't imagine that he was paying much tax.

minimum wage

in superquinn he was on 7.45. AFAIK in Abrakebabra he was on 6.35.
On programme he showed his pay slip to the camera and tax was deducted.

Does anyone know if government's VAT take is kept away from financing the Health service?

Re: public funding of private healthcare

In superquinn he was on 7.45. AFAIK in Abrakebabra he was on 6.35.

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Presumably the Abrakebabra programme was made before the new minimum wage of €7.00 per hour was introduced in early 2004?

On programme he showed his pay slip to the camera and tax was deducted.

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If he was hopping from job to job for the purposes of the programme (did he REALLY do these jobs or was it a set-up?) then perhaps he was also on emergency tax at some point?

The bottom line is that a minimum wage earner will pay little or no tax. Whether or not a minimum wage earner should pay ANY tax or when people should enter the tax net is obviously a valid point of debate and discussion.

VAT

GeoffreyOD,

all govt revenues are put into one big pot, out of which expenditures are made.

Taxes are not earmarked for particular expenditures, bar one or two exceptions.

e.g. motor tax goes to Local Authorities

Protocol

Re: public funding of private healthcare

Does anyone know if government's VAT take is kept away from financing the Health service?

Click to expand...

it is yeah geofrey. a friend of mine works in the civil
service in the department responsible for keeping vat away
from health spending. they use a purple indelible die and a
rubber stamp to mark notes and cheques raised from vat
with "not to be spent on the health service".

Health Care

I don’t think anyone would claim there are hoards of minimum wage earners dying from lack of health care in Ireland because they can’t afford it. It is nice for us to talk here about such things here in an almost “hypothetical” fashion; though how many of us here earn Euro 12,000? Also, not all low paid workers will obtain minimum wage based on a forty hour week. Some/many will not have 40hr contracts.

My major concerns with the present health system are that those on low income have to pay a higher proportion of their income on health care.

For someone on low income I do not think Euro70 per month paid for medications is a low amount. If someone pays the maximum of Euro70 per month (as some do) for medications for a year this is Euro840 + their gp expenses. For someone who requires frequent gp visits this could amount to Euro 500. Then maybe add in any other tests/in-patient stay/ambulance charge. So it’s quite possible for such a person to end up paying Euro 1500 in a year. Around 12.5% of their gross income. Someone who earns Euro 70,000 does not pay 12.5% (Euro8750). In fact they probably don’t even pay the same amount as the low-paid person (Euro 1500), as they are most likely in good health.

Is this “fair”? I suppose it’s a matter of opinion.

Yes, in extreme cases the health boards can help with financial support. Again, I have major reservations with such a system. I do not think it is right that any Irish citizen is put in the position where they effectively have to go begging to a health board for help with medical expenses. It is simple for us to suggest such options, though we are not the ones who will be going to the health boards for help.

This is why, in my opinion, it is preferable for health to be free at the point of use for the majority. Even if someone on low income did have to pay a relatively low amount of their income on their income on health care, there is also another moral argument. E.g. Two people earn Euro 12,000. One pays Euro 500 in a year because of illness, the other pays nothing as they were not ill. Is it right that a fellow citizen (especially low-paid) has had to pay Euro 500 because they were ill? Illness is not a consumer choice; it’s not something someone chooses to become.

Also, in my opinion the more a population has to worry about paying medical expenses (especially for those on low income), the more negative ramifications there are for other aspects of society.

Re: public funding of private healthcare

The reasons why our health services is suffering is due to the wastage of resources and money because
of

1. red tape
2. 'Consultant' fees
3. Over inflated wages
4. Time wasters.
5. Insurance liability

The health service being a public body will always be abused:- If everybody owns it, nobody owns it, therefore nobody cares.

The way forward for the health service is:

1. Cut down on red tape
2. Reduce consultant fees and over inflated wages - employ from abroad if possible
3. Send more people aboard to have operations
4. Fine time wasters
5. Bogus compo seekers when found out should be fined or even jailed for a week or two - and then billed for courts costs etc.
6. Privatise non-essential services.

Darag, your last post was of absolutely no help.

Sarcasm doesn't help to clarify anything and Protocol had already responded in a more helpful manner before.

In a country with high VAT rates going to support public services it is a valid question to ask if VAT paid by the poorest sections of society is used to prop up a health system that the wealthier sections may or may not get disproportionate advantage from.