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Never mind TTIP, the EU is on its own mission to ‘marketise’ healthcare…

May 26, 2016

 

There has been a lot of discussion over the last few weeks, especially after the recent leak, about the Trans-Atlantic Trade and Investment Partnership Treaty (currently being negotiated by the EU and the United States) having catastrophic consequences for the National Health Service (NHS).

 

The potential impact of TTIP is concerning. Further, the un-democratic nature of unelected Commissioners conducting, along with the input of interest groups, secret negotiations should concern anyone who has even a passing interest in the democratic principle. Yet, this is the system of Government to which we have submitted ourselves and, if the polls are anything to go by, are going to continue to do so.   

 

By concentrating on TTIP however, many commentators have missed something that should be equally concerning to those who want to maintain the NHS model of health provision. The EU, separate to TTIP, has been pursuing its own marketization agenda in relation to health services.

 

This process will not surprise anyone who truly understands the EU. It is a neo-liberal project to its core. It has spreading markets and facilitating the circulation of capital (within and between countries) in search of ever greater profits built into its DNA. At its apex sits the Court of Justice of the European Union (CJEU, formerly called the European Court of Justice - ECJ). And, as the legal academic Leila Brannstrom has pointed out:

 

‘…the overarching ‘structural bias’ of the CJEU is…adhering to the neoliberal regime of truth’ (Brannstrom, 2014).

 

The Commission and the Court of Justice have, in tandem, been engines of marketization bulldozing many of the constraints on capital which Member States had in place. Remaining in the EU with fantasies of ‘reform’ will not change this. The capitalist principles of the free movement of the factors of production are constitutional principles in the EU. Further, the Member States have failed to ‘tame’ the Court of Justice, despite attempts in the past on much more minor issues than fundamental principles (Barber Protocol anyone?). The EU is not going to unwind the 60 years of integration based on a market-liberal trajectory.

 

It’s a club for ‘big capital’. If you are in the least bit open-minded and honest about the EU you cannot but concede that point. But surely raising the possibility of a threat to the NHS from the EU, that is just scepticism gone mad, isn’t it? The point will be raised that health care is an area that is ‘reserved’ for the Member States, its ‘…in the Treaties’.

 

Well…umm…in short, that is not the whole story and to think it is shows that whoever

might be making that point does not understand the EU.

 

Below, this post tries to explain why. While reading the rest, it is vital that the ‘structural’ neo-liberal bias of the CJEU in particular is kept in mind. As will be illustrated, it plays a central role in the developing threat to the NHS.

 

Firstly, the Lisbon Treaty did expand the remit of the EU in relation to health policy. The EU now has a:

 

‘…facilitator role for EU institutions and...[the Treaties]…demands that member states engage in greater ‘cooperation’ in the field of health and in particular in ‘cross-border areas’’ (Morton, 2011).

 

Secondly, a couple of additional important (to its neo-liberal proclivities) realities about the EU and the Court of Justice in particular need to be understood. 

 

You may think that if a competency is not in the Treaties then it’s not an area that the EU will exercise power over. This, alas, is the kind of ‘play by the rules’ thinking that does not achieve the ultimate goal of ‘union’. Therefore, such inconvenient facts like a lack of a Treaty basis will not stop the EU and most infamously the CJEU from deciding to create or take a power. Indeed, the exercise of judicial power has been a primary driver of EU integration and centralisation since the early 1960s. Legal scholars have identified a distinct and effective methodology for increasing its authority over issues and policy areas. Scholar T C Hartley has described it succinctly:

 

A common tactic is to introduce a new doctrine gradually: in the first case that comes before it the Court will establish the doctrine as a general principle, but suggest that it is subject to various qualifications; the Court may even find some reason why it should not be applied to the facts of the case before it. The principle however, is now established…it will be reaffirmed in later cases: the qualifications can then be whittled away and the full extent of the doctrine revealed'’ (Hartley, 2010).

 

It has consistently made rulings with no basis in the Treaties. It has done this in three ways:

  • Extending the meaning of the wording of the Treaties beyond what is reasonable;

  • Made-up new principles where there is a complete absence of authority whatsoever. Perhaps the most famous two examples are the seminal and cases, which established the principles of ‘direct effect’ and ‘primacy’ of EU law respectively. Neither principle had any basis in the Treaty of Rome.

If that were not dangerous, unaccountable and arbitrary enough, the third way the EU and CJEU specifically extend their authority with no basis in the Treaties is by being willing to disregard explicit prohibitions in the Treaties on the EU having authority over a particular issue. The most recent and egregious example of this complete disregard was the ‘bail-outs’ of the troubled Eurozone countries. These were explicitly prohibited in the Treaties yet they happened anyway. As the legal scholar Gunner Beck has explained:

 

In the…2012 Pringle v Ireland case the ECJ was asked to examine whether the establishment of the permanent euro rescue fund (known as the ESM, or ‘European Stability Mechanism’) was compatible with the EU Treaties. Predictably, the Court found that the ESM did not violate the so-called ‘no bail-out’ clause (Article 125 TFEU) of the EU Treaties...the Court’s interpretation is impossible to square with the literal meaning of Article 125 which states that neither the Union nor a member state should ‘be liable for or assume . . . the commitments … of another Member State.’ Remarkably, the ECJ ruled that this prohibition was not intended to stop loans or financial guarantees to member states in trouble… the ordinary meaning of legal rules, the conventions of legal argumentation and the ‘no bail-out’ principle all gave way to the overriding political commitment to ‘break the law to save the euro’ (Beck, No date given).

 

Indeed, the need for an explicit prohibition in the first place should confirm to everyone that the EU cannot be trusted to confine itself to areas where there is a Treaty basis. It has a leach-like thirst for more power that should worry, well, everyone. A suspicion of power, especially a centralised power, ought to be an article of faith for anyone on the left. Alas, this key tenet of radical thinking appears to have become rather diluted over the last three decades as pessimism about the prospects for change both domestically and internationally has set-in among the left.

 

This willingness to ‘go beyond’ the Treaties however has been there from the start and has had profound consequences for both the power of the EU over the Member States and the democratic freedoms of the Member States. One of the complaints about TTIP is that corporations will be able to sue Governments for taking action which is detrimental to their market access, competitiveness etc. Well, the CJEU already plays this role! Businesses can sue Governments for policies detrimental to their economic activities. Yet, this is very rarely commented upon. But then, the CJEU is an institution that has been discussed very little in the referendum campaign so far. Yet it is the most important institution in the EU. What a bizarre referendum campaign we are having that this most un-democratic and powerful institution of the EU power structure is barely mentioned, or indeed barely known or understood! 

 

How is all this relevant to the NHS you are no doubt asking? Well, hopefully you are beginning to see something of a picture emerging:

  • The EU has a marketisation agenda built into its very being. It is moving further in a neo-liberal direction.

  • It is a body which operates arbitrarily to advance its own interests and build-up its power. Exclusions or prohibitions in its foundational documents do not stop it seizing control of those areas that are excluded or prohibited.

It is these established patterns that constitute the threat to the NHS in the UK.

There is evidence that they are beginning to apply to health policy, with Single Market principles after a raft of CJEU cases being applied to health care issues:

 

To understand how the Single Market’s four freedoms have infiltrated national policy concerning member states’ healthcare systems one must appreciate the ECJ’s role in this… The ECJ’s role as primary motor in the ‘Europeanisation of healthcare’ mirrors its motor role in European integration as a whole’ (Morton, 2011).

 

So, what exactly was done? Well, the case law goes back to 1984, since when a series of rulings saw the EU increase its authority over health care policy (Herman, 2013):

  • The earliest was a case called Luisi and Carbone , where it was established that health care could be covered by the key economic freedoms of the EU.

  • In Kohll [1998] the CJEU established that ‘Freedom of Movement’ applied to healthcare services even if they are services of a ‘special nature’.

  • A series of cases: Vanbraekel [2001], Smit and Peerboom [2001], Muller-Faure [2003] and Watts [2006] established that a-priori, healthcare services fall with the rules of the Single Market.

In these cases, the:

 

'…ECJ…[has]…put concerns of free movement rights above considerations of the way member states can fund and organise their healthcare system…Among the problems the ECJ’s new case law created was the impact it had on the variety of different means of funding healthcare systems in the EU…’ (Morton, 2011).

 

There is clearly an on-going policy by the EU’s most powerful institution, the CJEU, to:

 

‘…frame questions of healthcare in commercial & economic terms…’ (Morton, 2011).

 

The general rule is that healthcare can only be exempted from Single Market policy on a case-by-case basis.

 

The cases of Watts [2006] and Kohll [1998] are perhaps the most salient. Watts had particularly important implications for the NHS as it removed the need for authorisation from the NHS for the funding of medical care abroad. Free movement rights ranked more important that national health funding and other planning considerations by the CJEU. The implication of this position is that, such activities will make: 

 

‘…such tasks of organisation…[planning funding]…impractical’' (Morton, 2011).  

 

In Kohll [1998], the Court of Justice agreed that a dentist could provide services in any other member state because such key medical services were covered by the free movement of services principle. This should worry anyone who wants to maintain a state monopoly on health provision:

 

‘The expansion of free movement rights to healthcare providers is potentially the most damaging development in the EU’s entrance into healthcare policy. Increasing the rights and market opportunities of private providers will aid the creation and expansion of a Single European Healthcare Market. This in turn will only undermine systems of social provision’.

 

A recent Directive (the Cross-border Healthcare Directive) has barely improved the position and largely codified the existing case-law (EC, 2011). The horse-trading over the Directive did not ensure:

 

‘…theremoval of the Treaty’s single market provisions…Therefore a door has been opened and will be very difficult to close’ (Morton, 2011).

 

Not only does the inability to roll back the application of free movement to health care pose a worrying risk to the those who want a publicly owned and publicly funded and publicly accountable health care system in the UK, but to reinforce the fact that health care is now considered a commercial issue by the EU the Directive was part-introduced under Article 114 of the Treaty on the Functioning of the European Union (TFEU) – the Single Market article - as well as Article 168 TFEU. This should be ringing very loud alarm bells!

 

The principle has been established and the future direction looks set:

 

The ECJ’s case law and the CBHD...Refram[e]…social rights to healthcare around the economic principles of the market…The introduction of the EU and its four economic freedoms into this area can only point to further pressure toward liberalisation…[and consequently]…further undermine social healthcare provision and the systems that preserve them’ (Morton, 2011).

 

Of course the marketization won’t happen in one big step. No doubt, because of some of the political sensitivity of aspects of health care policy, much of the heavy-lifting will be done by the CJEU. As a result, the change will be hardly perceptible most of the time. This is consistent with the ‘usual method’, described by T C Hartley, of establishing EU authority over issues through the CJEU, where there was previously very little or none at all. An innocuous seeming case or cases establishing a significant principle, which is barely noticed immediately. Then the principle is slowly built up, with original qualifications and limitations whittled away.

 

As we have seen, the initial step has been taken and the principle of applying Single Market principles to health care has been established. What we can now look forward to is the gnawing away of the current limitations on the EU’s authority over health care policy and the fuller application of Single Market principles over time. This will likely take decades to come to full fruition.

 

The only way to eliminate this real and present risk and ensure a publicly run, publicly funded NHS for the long-term is to vote to leave the European Union. With full control back in the hands of UK authorities and where there are not neo-liberal Star Chambers i.e. policy courts, which is what the CJEU really is, to dictate policy on health care.    

 

 

 

Sources:

 

Beck, G (No date given). ‘ECJ legal rulings designed to help the Eurozone are threatening the accountability of European governance’, can be accessed at: http://blogs.lse.ac.uk/europpblog/2014/12/10/ecj-legal-rulings-designed-to-help-the-eurozone-are-threatening-the-accountability-of-european-governance/

 

Brannstrom, L (2014). ‘Law, Objectives of Government, and Regimes of Truth: Foucault’s Understanding of Law and the Transformation of the Law of the EU Internal Market’, Foucault Studies, No 18, pgs 173-194, can be accessed at: https://www.jur.lu.se/WEB.nsf/%28MenuItemByDocId%29/ID9906EFA5CF2ACF21C1257D860029825D/$FILE/br%C3%A4nnstr%C3%B6m%20law%20objectives%20of%20government%20and%20regimes%20of%20truth.pdf  

 

Directive, 2011/24/EU, can be accessed at: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2011:088:0045:0065:EN:PDF

 

Hartley TC (2010). ‘The Foundations of European Union Law’. 

 

Herman, L (2013). ‘A Single Market in Healthcare Services by Stealth?’, Working Paper 121/2013.

 

Morton, A (2011).’A Single European Market in Healthcare: The impact of European Union policy in national healthcare provision’, European Public Services Briefings 3, European Services Strategy Unit.

 

 

Supplementary info:

 

Watts [2006]: ‘Mrs. Yvonne Watts was on the NHS waiting list for a hip operation. She was given a three to four month wait for the procedure but she chose to go to France to have the operation. She was charged £3900 for the operation in France and she returned to the UK and asked for reimbursement…Mrs Watts was refused this and took legal proceedings against her local Primary Care Trust which eventually reached the ECJ. In line with its recent prior case law the ECJ decided that Mrs. Watts’ free movement rights were paramount and placed above the rights of the UK government to use prior authorisation rules organise its healthcare system, the NHS. This was also despite the fact Mrs Watts only requested authorisation once she had returned from France’. Source: Morton, A (2011).’A Single European Market in Healthcare: The impact of European Union policy in national healthcare provision’, European Public Services Briefings 3, European Services Strategy Unit, pg 6.

 

 

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