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Italian capitalism in the middle of the Coronavirus storm

The healthcare system and its weakening over the last years

by Marco

In the middle of a phase in which the global capitalist system appeared to be dealing with the haunting ghosts of the 2008 crisis, another typhoon shook the economic and political playing fields of Western capitalism.

Crisis periods are relevant, paradoxically, to understand how the world is running in the quiet moments, when contradictions remain underneath the surface of stability. The higher the stakes, the more extensive the resources that societal actors will employ to safeguard their interests, and, consequently, the clearer it becomes who is actually steering the wheels.

In this series of articles, I will try to address the ways in which the socioeconomic conditions of Italy influenced the management of the coronavirus pandemic, as well as how they are going to be influenced by it. I will address three main topics: healthcare, the management of the lockdown process, and the economic and political consequences for Italy in the European scenario.

In the limits of what can be done through an informative short blog article, I hope to give at least a general and multi-dimensional view of what is happening in Italy and why. For this to be possible, it is worth beginning with the factor anybody would point to when thinking of a public health crisis: the healthcare system.

Generous in normal times, poor during tough times: the dramatic weakening of healthcare facilities.

Undeniably, the Corona emergency has put the Italian healthcare system under strain, particularly in the worst-hit regions. What has been seen as puzzling by many observers is that a tax-based healthcare system providing universal coverage could not avoid such a high number of deaths both in absolute and relative numbers.

The realistic answer to this concern is that healthcare coverage matters only to a limited extent in accounting for deaths from a disease for which there is no vaccination, while other factors play out as more important, in particular the population age structure or the population density.

There is indeed little doubt about the fact that the percentage of over-80 years old people on the overall population in Italy, the highest in Europe and one of the highest in the World, has contributed to the increase in the lethality of the virus in the country.

External factors nonetheless, there is also good ground to argue that, specifically in the Italian case, the conditions of the healthcare system have contributed to turning the situation into the tragic story of thousands of deaths that has been reported by news all over the world.

The responsibility in this respect is nevertheless not to be found in healthcare coverage, which has remained high. For instance, although Italy has steadily displayed a rather high percentage of out-of-pocket payments (according to OECD data, 23.1% of the total healthcare expenditure in 2018), this is still the lowest value within the Southern-European group.

Moreover, accessibility to healthcare seems to have even improved over time, even though remarkable geographical differences remain. As displayed in the graph below, the percentage of households incurring sickness-related financial difficulties halved between 2004 and 2018.

Source: National Institute of Statistics (ISTAT) (2020).

At the same time, there is no doubt that the Italian system has been undergoing a process of reduction of its resources and its capabilities to deliver the same level of services as before, as clearly witnessed by data on public spending on healthcare. The next graph indeed shows that Italian per-capita healthcare expenditure used to develop along the general European average and below the average of the EU15 (members of the EU before 2004).

It is possible to identify a clear reversal of this trend from 2011 on, namely with the beginning of the austerity packages connected to the European management of the economic crisis. From then on, Italian per-capita expenditure has displayed a falling tendency, while the opposite is true for the general EU and EU15 averages, which have kept increasing.

Source: European Health for All Database (WHO) (2020).

Excluding that cuts may have affected affordability, attention has to be turned towards other indicators and specifically infrastructure. Considering that patients diagnosed with Covid19 display a higher likelihood to develop severe forms of pneumonia, acute care hospital beds are probably the most crucial value to consider. In this respect, Italy shares a common European path towards bed reduction, but starting from an already low level compared to both the European averages considered.

Between 2001 and 2013, the number of acute care beds per 100.000 population had been falling by an astounding 33%, by far the largest cut in the whole Europe. Similarly, the number of physicians employed by hospitals also declined starting from 2011, after a long increasing trend.

Source: European Health for All Database (WHO) (2020).

The logic underpinning these cuts is the same that underpins them anywhere else, namely the neoliberal ideological fetish of managerial “efficiency”, meant as achieving results with the lowest employment of resources possible. In the Italian public debate, this took the form of the “fight against waste”, a very vague and rhetorical term that almost every government put on the healthcare agenda. This ideological turn has led to a desperate hunt for indicators that could demonstrate that the country was offering the same level of services at an even lower cost for the public budget.

Consequently, national and regional governments started cutting infrastructure considered to be “superfluous”, bringing the healthcare system to a level where it could remain afloat in normal times, but strongly weakening it in case of emergency. Ironically, cutting hospital beds gives the mere illusion of saving public money, considering that one does not have to search long to find less affluent countries than Italy, which nonetheless display a higher number of beds per 100.000 population.

Weakened by years of ideological cuts in physical and human resources, the Italian healthcare system was overwhelmed by the unexpected hit of the epidemic. Nevertheless, this lack of infrastructure hit the worst where the epidemic hit the hardest, namely in Lombardy, ironically one of the regions with the best performing healthcare systems in the country.

Considering that about half of the total number of coronavirus cases in Italy is concentrated in Lombardy, the self-appointed “model region” has suddenly become famous for being the worst performer, since very soon the point of saturation of the available acute care bed units was reached.

The argument on the detrimental role of the scarce availability of facilities precisely in Lombardy is further reinforced by looking at the regional data in the table below. Taking a rough measure, namely the percentage of dead patients on the total of the diagnosed cases, it is noticeable that Lombardy ranks particularly high, with 18% of the officially diagnosed cases ending with death. As this is a relative measure, such a difference cannot be reasonably explained simply with the fact that there are more cases there.

Source: Italian Ministry of Health (Accessed on 12/04/2020),

Moreover, the WHO-commissioned report “Health Systems in Transition” shows data right on the effect of the 2011 Spending Review on the number of acute care beds. What appears is that Lombardy lost, in one year, around 1.400 acute care beds.

To conclude, a short remark has to be made on the regionalization process that the Italian healthcare system has been undergoing over the last 30 years. In this respect, in the Italian context, the ideological fetish of managerial efficiency was translated into regionalization and decentralization of healthcare.

On the one hand, regions have a very wide range of competences in healthcare matters, even though they cannot decide the basic benefit package. Therefore, the Italian healthcare system can be thought of as a micro-galaxy of sub-systems, each one with its specific features. This said, it is also useful to remark that the basic benefit package is firmly established at the national level.

On the other hand, decentralization has meant the introduction of organizational forms in which management has rapidly achieved larger independence, with the purpose of creating “quasi-markets” for healthcare services. Every region could then decide to what extent to implement this principle, as well as the role to be played by private providers.

In general terms, the regionalization process has been more important, since the “managerialist” turn in healthcare management either decelerated or was stopped at a certain point by regional governments. Notoriously, Lombardy stands out as the exception to this general tendency, and the region has featured its own model, particularly focused on competition and widely reliant on private providers.

It is still to be understood whether the “Lombardy model” itself hindered the effective management of the pandemic. However, critics have pointed out to the hesitancy and late involvement of private providers in the management of the emergency. On paper, the more centralized and still rather hard-hit region of Veneto seems to have managed the emergency way better.

Considering that the healthcare system of Lombardy was considered to be one of the best-equipped, there are more than good reasons to expect that, was the epicenter of the epidemic to be located in a less affluent region, an even more dramatic picture could have resulted, since the saturation point of hospital facilities would have been reached at an earlier point.

Well aware of the risk that the epidemic could have rapidly spread to less equipped areas, the government attempted to avoid situations that would have brought those healthcare systems on the brink of collapse. The first reaction was to announce a series of restrictions on social habits and freedom of movement over the national territory.

The next article will be dedicated to the process leading to the introduction of the emergency measures, focusing on how they have been shaped by the balance of power between government, business and workers’ organizations.

This is the first of a series of articles about COVID-19 in Italy, written for theleftberlin.com.

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