False Incentives

Abstract

No two countries are alike when it comes to organizing and delivering healthcare for their people. When the Prussian government sent Rudolf Virchow to Upper Silesia in 1848 to investigate the epidemic of typhus there, he identified hunger, poverty, and poor hygiene as the main causes. Virchow saw the state and the church as responsible. And his prescription? Not medicine, but political and social reforms: “Medicine is a social science, and politics is nothing more than medicine on a large scale”. So, Virchow became politically active in the Reichstag, the German parliament, and a constant proverbial thorn in the German chancellor Bismarck’s side culminating in the infamous Sausage Duel over a debate on the funding for the navy. Bismarck challenged Virchow the next day to a duel, but as the one challenged Virchow was allowed to choose the weapons, and he chose two seemingly alike sausages, one filled with trichinae (a worm which causes a deadly zoonotic disease) and the other a normal sausage. Virchow then asked Bismarck to choose his weapon and eat it, and then he will do the same. Bismarck’s representatives refused, and thus no duel was fought. In December 1884, Otto von Bismarck introduced the first large-scale compulsory insurance to establish universal healthcare. However, Bismarck’s original intentions were not genuinely social. His health insurance was a reluctant reaction to upheavals among the working class in the wake of the Industrial Revolution, and a way to secure a political advantage against the Socialist Workers Party. Thus, health = politics, and, notwithstanding the desire and goal to help a patient, an important and legitimate incentive for healthcare providers and organizations is money and profit provided the patient comes first. So, it is worth looking at the political and financial incentives in different healthcare systems.