What will Hollande do to French healthcare?

Newly elected President Hollande’s manifesto has sixty points and just one of them covers healthcare so specifics are thin on the ground.

What is clear is that he intends to close tax loop holes and increase taxes for the wealthy as high as 75% and spend the extra money mainly on education but also partly on healthcare.
However, we think there are indicators:

In the hospital market Hollande has said he will not follow through on the convergence of tariffs for the private and public healthcare sectors.

That may not prove a big change as it is under Sarkozy that the MCO tariff on which the private sector is so dependent, was raised just 0.19% in March 2012, whilst the MIGAC budget, 99% of which is used to fund public hospitals, went up 3%. Tariffs for private hospitals are of course around 27% lower than the equivalent in the public sector. Sarkosy’s government has managed to limit the overall assurance maladie budget to €8.5bn in 2011 down from €11bn the year before. For the last three years healthcare spending growth has been south of 3% per year.

Hollande’s new government has not given a clear timetable for the reform of the financing of old age dependency, that was always postponed under Sarkosy’s 5-yr term, due to state finances constraints. Some socialist-run districts have also indicated that they want more nursing homes that cater for the poor and that these should be run by the public sector. We point to the department of Essonne where there are plans to add 1,000 beds within the public sector, whose occupants will be expect to pay just €60 a day.

This is likely to mean that the private sector will see little or no growth with new bed licences mainly taken by public sector operators. But, again, we argue that this was already factored in by analysts.

We don’t expect the fast consolidation taking place in labs and home care to be arrested. Over the past five years, the French state has encouraged consolidation in order to make quality control easier and eventually to reduce costs. Sectors like that are likely to be far far down Hollande’s radar.

Source: Healthcare Europe / May 18th 2012

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