Parliament passed two finance bills, both thanks to the Socialist Party (PS), as expected. But why two finance bills? Because one concerns taxes, as with all parliaments worldwide, and the other the Social Security budget. It is this latter bill that we will examine.
What was passedBasically, there are always three parts to Social Security finance bills.
First, a National Health Insurance Expenditure Target (ONDAM) is set. A 3% increase compared to the initial plan is projected for 2025. Considering the state of hospitals and the extent of healthcare deserts while the population ages, this isn't enormous. But still, it's more than initially anticipated.
Next, an agreement must be reached on revenue. Of course, the government refused to consider any increase in employer contributions. The CSG (1) on certain incomes will increase. Part of the social security debt will be transferred to the CADES (2), which means that the CRDS (3) will increase. The government has abandoned the extension of deductibles. Some minor taxes have been retained despite their initial plan to be eliminated.
Finally, there needs to be an agreement on spending. The government has abandoned the elimination of 100% coverage for long-term illnesses, and the pension reform is suspended for two years. However, the maximum duration of sick leave is reduced, including for workplace accidents. The rest are mostly cosmetic measures.
While we're on the subject of cosmetics, since the prevailing narrative is "we're doing everything we can to save our social welfare system," we have to appear to be making progress: extending paid parental leave after childbirth, fully reimbursing wheelchairs (it was about time!), investing in housing for the elderly, covering certain preventative treatments for long-term illnesses (that, too, was vaguely about time...).
But what's fundamentally wrong with all this?
The best social protection in the world?
That's what we've long told ourselves about social security, and it was true for a while. We associate social security with "good times" and Fordism. Let's not romanticize it too much. Those days weren't so good, partly because the aftermath of war meant ruin, misery, and rationing. If there's ever a time when financing social security is impossible, it's now. And yet, it was done. Not in a grand, unanimous, and patriotic surge. Because part of the Resistance claimed to be communist, and it was essential that they agree to lay down their arms. Because the French Communist Party (PCF) was the leading electoral party in France, and in the Cold War, it was crucial that neither France nor Italy fall to the dark side.
The system initially envisioned was simple, modeled on workers' mutual aid societies. A fund financed by mandatory contributions (from employees and their employers), managed primarily by elected employee representatives. A single fund for health, retirement, unemployment, family allowances, and workplace accidents (a single fund allows for offsetting deficits between funds and prioritizing funding). 100% reimbursement. In fact, these were local funds (allowing for proximity to the user) overseen by a national fund (where representatives of the State were present).
The URSSAF (the French social security collection agency) had to be created to make employers pay. But yes, as originally conceived, social security was an excellent social protection system.
A death planned from the start
What were the debates in the National Assembly in 1949? The need to combat fraud and abuse by insured individuals, the aging population could not be supported by social security, minor risks had to be de-reimbursed, some benefits transferred to mutual insurance companies… Doesn't that remind you of anything? Apart from the CGT (4), everyone opposed the establishment of a single fund. From the outset, family allowances were separate from social security, and workplace accidents were included but with differentiated contributions. The state obtained a significant number of representatives on the national social security fund. The CGT won the 1947 elections, but immediately afterward, FO split and allied itself with the CFTC, mutual benefit societies, and employers. The CGT thus effectively became a minority in the fund's management.
From the Common Market onward, preparations had to be made for a liberal Europe. The reform of the general social security system was part of a broader framework of opening the market to competition. It was the Jeannenay Ordinances of 1967 that triggered significant strikes, even though the events of 1968 have overshadowed them in the collective memory. The general social security system was divided into three separate funds (health, family, and old age), thus preventing solidarity between different risks. Joint management by employers and unions was introduced: representatives of those affected were now appointed (the CGT union's share of employee seats fell from 43% to 33%), and they held only half the seats. In short, the unions lost control to an alliance between the state and employers. This sparked the debate on "undue burdens," meaning expenses that the state imposed on the general social security system without the latter collecting any corresponding contributions. Finally, the State seeks to better control the hospital sector by creating a healthcare map, strengthening the power of hospital directors (appointed by the Ministry), and gradually transforming it into a state service through the civil service status of its staff.
The left will reinstate elections, which are boycotted by employees. It must be said that this has become a symbolic issue, as the State has largely become the master of the game. It is the left (Rocard) that will initiate the fiscalization of financing with the CSG (General Social Contribution). Fiscalization means paying through taxes. What does this change for us? On the payslip, it amounts to an increase in contributions, except that the employer's contributions remain unchanged. But above all, it further reduces the autonomy of social security in relation to the State; it becomes a budgetary tool, an element of its policy. This was justified by the fact that it allowed the self-employed to pay, that it "broadened the tax base." Of course, since it's in the hands of the State, it changes without negotiation: 1.1% at the time, 9.2% in 2022… In 2020, contributions represented only 32.4% of the health insurance fund's financing, compared to 32.7% for the CSG (General Social Contribution).
What did Juppé do in 1996? He created the social security budget, the social security debt, institutionalized the role of mutual insurance companies, and created the regional health prefectures. It was a constitutional law (which amended the constitution). Parliament debated the major policy directions (the ONDAM, which I mentioned earlier), and in effect, we shifted from a logic of responding to needs to a logic of adapting to budgetary constraints. He created CADES, meaning that instead of increasing contributions to boost healthcare production, the social security system had to finance its own return to balance by borrowing on the financial markets. He mandated two representatives from French mutual insurance companies and four qualified individuals appointed by the State in each local (primary) fund. The hierarchical relationship between the State and the funds was reinforced through performance and management agreements. Finally, he created the Regional Health Agencies (ARH) under the direct authority of the Ministry (directors appointed by the Council of Ministers and subject to dismissal), which would become the Regional Health Agencies (ARS) in 2004.
From then on, social security became a cog in the State budget, an element of its social and general policy. It is well known that the social security budget is inherently countercyclical: in times of prosperity, the amount of contributions increases; in times of crisis, it decreases. This is the source of the social security deficit. Between 2008 and 2009, its deficit doubled. This isn't because we received twice as much healthcare… Right now, the priority is debt repayment, and therefore social security has to contribute to this at the expense of health and social objectives. As it was conceived in 1945, such reasoning was unthinkable. Social security was meant to manage contributions as best as possible and decide on priorities between health, retirement, etc., even if it meant raising contributions, negotiated between employers and unions. It wasn't part of the state budget. Although in the hands of union bureaucracies, our health wasn't a pawn in political games.
Social security at the service of capital
From the outset, medicine remained a liberal profession, and doctors were vehemently opposed to the introduction of fee-for-service billing. After years of conflict, this resulted in the creation of Sectors I and II. Doctors also imposed quotas to create a shortage.
For the pharmaceutical industry, drug reimbursement is a boon because it makes customers solvent. Prices are negotiated centrally, but close ties exist between pharmaceutical executives and the senior civil servants responsible for regulating them. Revolving door practices also play a role. (5) Private clinics also benefit from the system. Social security has also enabled a medical industry with heavy investments and standardization that promotes concentration. Since Juppé (and even before), we can speak of financialization. Hospitals have to finance themselves through loans since social security must contribute to budgetary balance. Social security is also forced to finance itself on the financial markets (previously, the State made repayable advances). The social security deficit also reflects the interests of financiers. Clinics, laboratories, nursing homes, etc., are now mostly in the hands of a few large groups.
Finally, the reduction in reimbursements (excess fees, delisting of medications, co-payments, etc.), which has been a continuous policy of the State for decades, allows for the development of mutual insurance companies and an insurance market, again made solvent by the tax system. Mutual insurance companies are now aligned with insurance companies in their management. Social security means everyone pays according to their income and receives according to their needs. Insurance is a calculation of risk: high risks mean high premiums (the older you are, the more you pay, for example), low premiums mean less coverage.
In fact, it all makes sense. You can't imagine an island of "social" protection in an ocean of capitalism. From the moment you leave most of healthcare in the hands of the private sector (general practitioners, labs, clinics, etc.), social security will allow a significant market for capital to become profitable. At the beginning of the last century, the poor didn't receive medical care, except in times of war. With social security, the poor can get treatment, and that's a huge step forward, but they have become an attractive market for capital.
Separating healthcare from the state. So, we understand, yes, we used to have very good social protection, and we still retain some of it. In France, major medical treatments are almost entirely reimbursed; we can't imagine forgoing major surgery for financial reasons. For several decades, the system functioned relatively well. Clinics were established, and massive investments were made in hospitals, which ceased to be places where the destitute were confined—as they essentially were until the end of the Second World War—and became renowned centers of healthcare. But today, we are paying the price for the space given to capital and its subsequent takeover by the state (the two being inextricably linked).
The issue cannot be reduced to simply more resources for this or fewer resources for that. Of course, we must fight to maintain social protection. But we must recognize that if we only consider budgets, it is medical capitalism that social security is funding, and therefore also a certain conception of medicine and healthcare. And this will continue as long as we leave the provision of healthcare to the private sector. We saw the result of nationalizing social security with the management of COVID: not only overwhelmed hospitals, but a one-size-fits-all solution—the vaccine—and a ban on personalized care. We must take back control of healthcare. Today, it is the State, in consultation with capital of course, that decides which treatments can be reimbursed and which cannot (see, for example, homeopathy). We must reaffirm the principle that everyone pays according to their means and is treated according to their needs, and fight against false assumptions like "if you are at risk, you have to pay more," which are the antithesis of social protection. Above all, we must remember that healthcare and a long life are not a burden and should not be budgetary adjustment variables; they are progress.
Sylvie
To learn more about the long and conflictual history of social security, there is an interesting book: Nicolas Da Silva, *The Battle for Social Security*. A History of the Healthcare System, published by La Fabrique
Notes
1. General Social Contribution (CSG). A tax that finances social security.
2. CADES is the fund created by Juppé to borrow on the financial markets to repay part of the social security debt.
3. Contribution to the Repayment of the Social Debt (CSR). A tax that finances CADES.
4. In fact, it wasn't completely unified. Railway workers, miners, etc., were keen to keep their special pension schemes and were therefore opposed to a single fund. They too contributed to the fragmentation of social security.
5. Revolving doors (or "pantouflage") refers to moving back and forth between the public and private sectors.
http://oclibertaire.lautre.net/spip.php?article4659
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