Is the NHS under threat from free trade?

Pressure building. Andy Rain/EPA

The National Health Service is one of the biggest and most popular arms of the UK public service. Attempts to privatise healthcare provision have been fiercely resisted and all major political parties present themselves as protectors and champions of the NHS. But what if politicians’ ability to decide medical and public health policies was taken away from them – and the NHS was forced to compete against private companies in a free market?

That’s one of the fears about the major free trade agreement being negotiated between the EU and the USA. The Transatlantic Trade and Investment Partnership (TTIP) seeks to cut tariffs and regulations that act as barriers to trade between the countries involved.

For the health sector, it holds the potential to change the rules that currently protect patients and healthcare professionals, define competition in the provision of medical services and structure public health policy. But how much of the noise being made by health community actors is scaremongering and how much warrants greater attention?

Lack of transparency

The major concerns about TTIP are not solely about what the agreement says but also about the way in which it is being negotiated. The health sector faces the same fundamental problem in organising and preparing a response to TTIP as every other sector: until a final text is agreed it is impossible to assess the impacts. Put simply, we don’t yet know what TTIP says.

The lack of transparency in the negotiations has been heavily criticised and the European Commission (the EU’s executive body) has recently responded by publishing its official negotiating mandate. However, the current draft of the compromise text remains unavailable to all except those involved in negotiations and members of the European parliament (MEPs), who are only able to view it in designated reading rooms.

The lack of documentation makes assessing TTIP’s content difficult – but already a number of potential threats to the NHS have been identified. The central concern is that the agreement could open the NHS up to American suppliers and healthcare companies, liberalising the market and increasing the privatisation of health services.

European parliament says no. Patrick Seeger/EPA

Under EU law, health is classed as a “service of general economic interest”, meaning that it could theoretically be understood as a market activity and that barriers to free competition between private, public and UK and US-based service providers could be challenged in court. Indeed it is feasible that industry and even some elements of national governments favour exploiting the benefits in terms of increased exports of goods and services associated with healthcare.

However, the worst-case scenario looks unlikely for the time being. Those documents that have been released to date have generally included an exclusion for publicly funded health services – and the commission’s negotiating team has consistently stated there is no intention to use TTIP in this way.

The NHS European office, which provides a crucial link between EU policy and NHS organisations, has done extensive work on the TTIP and in 2014 issued a briefing that presents the “evidence of reassurance” on this point. It supports the inclusion of a specific exemption for health but is measured in its assessment of the risks, listing a number of public statements from both the commission and UK politicians that pledge to protect health.

Investor protection

Another, arguably far more worrying, element of TTIP is the way it would allow companies to sue the government if policies hurt their profits or investments. This Investor State Dispute Settlement (ISDS) mechanism would use controversial private arbitration panels made up of lawyers to oversee such lawsuits behind closed doors. This would undermine the UK and EU legal systems and make judicial review impossible.

The ISDS is particularly worrying for the NHS in light of two important legal cases. In Philip Morris v Australia, a large tobacco firm is currently using the courts to challenge a ban on branding on cigarette packaging.

In Achmea v Slovakia, a company investing in health insurance services sued the Slovakian government over plans to establish a single health insurance company. In this matter, the tribunal ruled it did not have jurisdiction over the democratic process – but the case for compensation remains open and the company won a previous suit in 2012.

If it becomes easier to sue governments in this way, they might be put off taking action to protect public health or improve service provision that risks damaging companies’ profits.

Caution and vigilance

Other potential risks posed by the TTIP include the negative health impacts from reduced tariffs on unhealthy foods and less stringent standards for the approval of drugs. There might also be delays to patient access to medicines because higher intellectual property (IP) standards in the US could mean cheaper copies of “originator” drugs are banned for longer.

However, equally possible is the potential for TTIP to increase access to medicines currently held up by duplicated regulatory procedures, to facilitate the trade of superior health technologies and to improve healthcare standards.

The TTIP does not have to include the ISDS in its current form. In fact, the divisions over the mechanism are so deep that the European parliament recently postponed a vote on whether to include ISDS in its draft report.

Until the final wording of the treaty is released, those worried about TTIP can do little but remain vigilant, press for greater transparency and recognise the ever-more-apparent impact of trade upon healthcare provision.

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