A recent New York Times story reports that the new British government plans to “decentralize” the National Health Care system as part of its new austerity measures.

Practical details of the plan are still sketchy. But its aim is clear: to shift control of England’s $160 billion annual health budget from a centralized bureaucracy to doctors at the local level. Under the plan, $100 billion to $125 billion a year would be meted out to general practitioners, who would use the money to buy services from hospitals and other health care providers.

The plan would also shrink the bureaucratic apparatus, in keeping with the government’s goal to effect $30 billion in “efficiency savings” in the health budget by 2014 and to reduce administrative costs by 45 percent. Tens of thousands of jobs would be lost because layers of bureaucracy would be abolished.

[N.B. Note that the plan applies only to England; the other constituent countries of the UK will have to make their own policies]

Though I’m not by any means an expert on British politics, the move strikes me as bold for two reasons: (1) The Conservatives have reversed their original position on not touching the National Health Service, instead opting for a plan that seeks to make unprecedented changes to the system; and (2) according to the NYT”s reporting, the plan is predictably facing intense opposition from government employees that stand to lose their jobs, as $30 billion are saved and 45% of administrative costs are phased out by 2014. In fact, some union members are trying to derail the plan by portraying it as a stepping stone towards privatization.

But what is most pleasant about this whole affair is the precise appeal made to an idea very similar to the Catholic understanding of subsidiarity:

“One of the great attractions of this is that it will be able to focus on what local people need,” said Prof. Steve Field, chairman of the Royal College of General Practitioners, which represents about 40,000 of the 50,000 general practitioners in the country. “This is about clinicians taking responsibility for making these decisions.”

Dr. Richard Vautrey, deputy chairman of the general practitioner committee at the British Medical Association, said general practitioners had long felt there were “far too many bureaucratic hurdles to leap” in the system, impeding communication. “In many places, the communication between G.P.’s and consultants in hospitals has become fragmented and distant,” he said.

Here we once again have the understanding that society should deal with problems on the lowest possible level.

But the winning side in this plan is not just that of the proponents of subsidiarity. Economic theory also suggests that policies guided by sentiments similar to subsidiarity tend to increase prosperity: the $30 billion that the government plans to cut from the budget will now exist in the private sector, where it can be put to more productive uses, in accordance with consumer demand. The civil employees released from their positions in the government do not have to mire in unemployment; instead the money from their state salaries will be used by the private sector to create positions which they can fill.

On the other side of the ocean, the United States moves in the other direction: away from subsidiarity, and towards a “one-size-fits-all” solution to fixing our health care system. The office of Congressman Kevin Brady recently released a diagram prepared by the minority of the Joint Economic Committee. It’s a fully detailed diagram of what the new health care system in the United States will look like once all provisions of the legislation are in effect. Take a look:

Chart Outlining ObamaCare

America's New Health Care System

The current health care system already raises enough questions about whether the principle of subsidiarity is respected. But this newest remake makes the question all the more serious.

In fact, over 37 states have begun to take some form of legal action against the health care legislation on the constitutional grounds that regulations such as the individual mandate overstep the federal government’s legal bounds. As I’ve argued before, the federalism of the Constitution is a rather good embodiment of the principle of subsidiarity, since it recognizes that many issues (even urgent and pressing ones like health care) should be dealt with at the state level.

And some partial victories for advocates of subsidiarity are already making the news: Missouri voters overwhelmingly approved of a ballot initiative opposing the individual mandate (by a landslide ratio of 3 to 1), and a federal judge refused to dismiss a suit by Virginia that challenges the constitutionality of the health care law.

In addition to a national campaign to repeal the legislation at a Congressional level, supporters of subsidiarity would do well to also pay attention to the battles at the state level. I suspect this is where we will see the greatest impact.


  • http://blog.cfmpl.org Andrew Haines

    Chris, excellent analysis. I’m no economist, but Acton’s continual insistence on the importance of subsidiarity — coupled with a strong sense of the underlying, functional market-mentality in the US — always impress me.

    You’re also quite right in saying that the state level affords the most progress, in many cases. This is certainly true with economics, as well as central social issues, like abortion and gay marriage. In the end, the people will decide what is best.