Sunday July 4, 2010

ANALYSIS - Health and austerity: When budget cuts cost lives

LONDON (Reuters) - European leaders slicing away at national budgets are keen to persuade voters that healthcare is sacrosanct, but they will struggle to escape the truth that cutting spending elsewhere also eventually costs lives.

If a government's first priority is to protect the lives of its people, then ringfencing health spending while cutting other budgets and trying to drive down the cost of medicines -- policies being pursued in Europe -- seem sensible options.

PhD student Maija Maskuninty works in a laboratory at Imperial College in London, May 28, 2010. (REUTERS/Paul Hackett/Files)

Yet experts say the planned cuts in welfare and other state programmes will hit everything from pensions to housing to playgrounds, all of which also affect the health of nations.

If unemployment rises, as predicted in countries such as Britain and Spain, the consequences could be hazardous. In short, there is more to health than healthcare.

"These cuts will result in significant harm to people's health," said David Stuckler from the Department of Sociology at Oxford University. "It's not just about doctors and medicines to care for the sick -- social care and support are vital to prevent people from becoming ill."

In a study published in the British Medical Journal (BMJ) last week, Stuckler and colleagues calculated that for approximately every 80 euros ($107) cut from social welfare spending per person, alcohol-related deaths would rise by about 2.8 percent and heart disease deaths by around 1.2 percent.

Britain has just set out a punishing round of public spending cuts, while Greece, Spain, Portugal and Italy are all planning drastic deficit reductions. Even Germany, Europe's largest and arguably healthiest economy, is targetting 80 billion euros of budget savings over the next four years.

"So far the discussion about radical budget cuts has largely focused on improving the economy. But ... these cuts will have a major adverse impact on the lives of ordinary people," said Stuckler. "If we can remind policymakers that these cuts will cause real suffering ... perhaps the decades of pain and austerity that are being contemplated will come with a human face."

For a graphic on European austerity measures, click http://graphics.thomsonreuters.com/10/EZ_AUSTM0510.html

Previous studies have found that unemployment rates have an almost immediate impact on mental health and suicide rates.

"It's an incredibly difficult thing to link what happens this year or next year in welfare budgets and what happens some way down the line with people's health," said John Appleby, chief economist at the King's Fund health think-tank in London.

"But what we do know, from every study that has ever been done on it, is that unemployment is not good for people's health. So yes, there will be at the margins a small proportion who will suffer catastrophically -- in other words they'll die."

SHOCK THERAPY

Politicians trying to distance themselves from the idea that spending cuts may lead to higher death rates could seek to blame the recession itself. Scientists have found a strong correlation between higher economic growth and lower mortality rates.

But Stuckler said evidence also shows that this link can be all but broken if social spending is kept up during tough times -- and conversely made more direct if social support systems are pared down by austerity measures.

He pointed to Russia in the early 1990s where "shock therapy" tactics to force the country into a capitalist system also stripped away many of the social welfare functions for workers, families and children.

"Those rapid economic changes and strict austerity programmes led to a devastating mortality crisis, an immediate rise in suicides, heart attacks, and alcohol related deaths as well as an inability to control rises in HIV, tuberculosis, and their drug-resistant forms," he said. "And we are still dealing with the consequences of those policies today."

On the other hand, the effects of the Great Depression on rates of premature death and chronic disease in the United States in the 1930s were mitigated, he said, partly because they coincided with the birth of the U.S. welfare system.

Martin McKee of the World Health Organisation's European Observatory on Health Systems and Policies, who worked on the BMJ study, says the full impact of austerity measures on death and disease may not be felt for some time.

There can be decades-long lag times between government austerity measures and consequences such as deaths from obesity or heart disease caused by poor diets in families which have been forced by joblessness and a lack of welfare support to buy cheap, low quality food, for example.

"Scientific research can only demonstrate the short-term impacts," McKee said. "But everything we know tells us it is highly likely this will have significant long-term effects."

Appleby reckons the time lag provides a smoke screen for policymakers who can shelter behind the fact that pressure applied now may not hurt until 10, 20 or 30 years later.

"We're talking statistical lives, in a way, which I suppose makes it easier to bear," he said. "And of course somebody else will be in power then."

(Editing by David Stamp)

(For more business news on Reuters India click http://in.reuters.com)

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Sunday July 4, 2010

ANALYSIS - Health and austerity: When budget cuts cost lives