from Healthcare Economist at https://bit.ly/2BpAFfz on June 30, 2020 at 05:00AM
Recently I read an interesting book called Moneyland by Oliver Bullough. The book describes how with porous borders facilitated by the internet, the rich can evade taxes, hide assets, and basically pick and choose the international legal system most favorable to their interests.
One interesting part of the book discusses health care in the Ukraine and how it has evolved over time. I am not an expert in the Ukrainian health care system so this was interesting to read. Of note is that although health care is free in Ukraine’s socialized system, it really isn’t free.
Ukraine’s constitution guaranteed free healthcare, but in reality patients paid for almost everything. Supposedly, the institutes budget was adequate for all of its needs, but doctors’ salaries were tiny and they were forced to ask patients to fund their own drugs, or even to contribute money towards the upkeep of equipment.
So socialized medicine did not appear to be working well here. The author notes that the Ukrainian kleptocratic government stole funds from healthcare which helped exacerbate the underfunding. If you are a fan of private health insurance, you would say that government corruption and inefficiencies are rife in publicly funded systems so this is no surprise. If you favor socialized medicine, you would say that countries with good governance and stronger institutions than Ukraine could solve these problems and that private health insurance is not without its own problems.
The author compares the current Ukrainian health care system to the system under Soviet times and does so with a bit of rose-tinted glasses.
In Soviet times…the government under-valued doctors who were paid little. Ordinary citizens, however, were grateful to the medics that helped them get better and brought them presents: candy, or alcohol…If you went to the doctor, even though healthcare was free, you took something along to give her. After 1991 when the Soviet Union collapsed, the situation changed, however. Doctors began to realize how much their Western colleagues were earning and also to appreciate the heft of their position…
‘When we were a market economy, sweets or brandy didn’t cut it anymore,’ the agent said. ‘Doctors wanted money, actual banknotes, and people started paying them…
Ukrainian health care costs are socialized, in that the government pays for the facilities,
the buildings and the infrastructure. The profits, however, are privatized, in that the doctors get to keep what they earn.
To read between the lines, doctors have been underpaid consistently under socialized medicine and bribes have been a endemic in their system over many decades. The author, however, naively believes that in Soviet times “They weren’t so much bribes as genuine gifts” whereas under capitalism the bribes were bribes. Let’s call a spade a spade; when there is no market clearing price and queues form, bribes may occur to get closer to a market-clearing price.
General comments on the book
Despite my write-up, above, most of the book is about the ability to move assets offshore to avoid government taxes and regulation. Overall, the book is interesting, but a bit long and would be better served as a long essay. Few people care to learn about so many of the the different ways the rich can flaunt the laws. Further, the book focuses on bad people avoiding good laws. In practice, however, sometimes dictatorships will confiscate moneys outside the rule of law. In this case, good people with means may use Moneyland to hide their assets from the kleptocracy. Often, in fact, the kleptocrats themselves are hiding their assets offshore.
In short, the book is interesting and worth a read, but I put it down half way through after I largely got the gist of the author’s key points.