It is widely accepted that central authorities in the welfare state should redistribute some individual wealth to the general public, which funds medical services for people who are unable to pay for them.

When welfare benefits are redistributed in this way, a destructive shift occurs.

Redistribution

If the redistributed wealth (money) were to end up directly in the hands of the underprivileged, who would then decide at which health facility (service provider) they exchange their value (money), the patients would still act as customers, whereas if they did not pay directly, they would be users but not customers.

Indeed, the difference between a stakeholder and a customer lies in the answer to the question of who has the money that is exchanged for the service. A customer in the normal market exchanges his money for the fish he buys. He assumes three roles: that of a customer, that of a user, and that of a stakeholder. A son who pays for the service of a nursing home for his mother is a customer and stakeholder while his mother is a user and a stakeholder.

Underprivileged and thus subsidized users of health services could still act as traditional customers and use “their” money, even if that money comes from public redistribution. The first shift then, is not so much the distribution itself, but the agency of the one who pays.

Wrong beneficiary 

The whole situation is corrupted by the transfer of the “common wealth” to another public authority and not to the patients. With this seemingly insignificant shift, the necessary balance between customer and service providers is seriously disturbed. In the latter case, where the redistribution is followed by the exclusion of the patient from the equation, the exchange of value takes place between a public authority that received the money and the service provider. In such a situation, the patient is no longer the customer. The public authority suddenly appears in the position of the customer. 

Since each service provider focuses on its customer, it is natural for a service provider (e.g., a hospital) to care more about the public authority with which it exchanges value than about its patients, who are “only” users. The next confusion arises with physicians, who on the one hand are directly connected to patients, but on the other hand receive their salary from the hospital. The doctor’s oath demands loyalty to the patient, but his wallet as the hospital’s wallet demands loyalty to the institution that redistributes funds for the survival of doctors and hospitals.

What happens in such a situation is that service users (patients) shift their position within the brand formula of such a service provider from customers to stakeholders. They cannot be considered customers because they have nothing to exchange for the service provided by a physician. They become stakeholders who benefit from the mission of the service provider’s brand. The public authority has a mission to make the earth a more livable place, but it does business through a business model tied to a vision in which physicians play a role. Patients, as beneficiaries of a mission, are nurtured by external circumstances of exchange, not by the exchange of value itself.

A patient as a not-necessary cost

It should not be surprising, therefore, that a patient does not feel like a respected customer in such a system. He is not a customer, he is only a user. And it would be an anomaly if such service providers (including doctors) saw their patients as customers!

Patients who have stakeholder status in such a situation are not necessary costs. It is not worth investing in the mission/stakeholder as much as in the vision/customers. Cutting corners on users who are not customers is part of the necessary business logic of any organization, and healthcare institutions are no exception.

So, there is no chance that patients will be treated as valued customers in a welfare state that redistributes the common good to the public purse rather than directly to patients.