The current EU treaties only give the EU the power to 'support, coordinate and supplement' the actions of the Member States in public health. During the COVID pandemic, it has become clear that European action is necessary to combat big, cross-border health risks. Even the European Commission itself has argued that the EU's limited competences have made it difficult for the EU to have a strong response to the pandemic.
Even besides COVID, there are reasons to strengthen the EU's competences on health. The EU's limited powers on health have often meant that health legislation has had to be adopted using the promotion of the internal market as the legal basis. An example of this is the "Patients' Rights Directive" that ensures access to healthcare across borders. If the legislation is about health, it's clearer for citizens if the laws are passed based on the EU's powers on health. This also helps with avoiding legal problems.
The solution would be to make health a "shared competence" between the EU and the Member States. This way, the EU would have the same status in health policy as in, for example, energy or the environment. The result is that the EU would have clearer powers to pass laws on public health, and to respond to crises. Even after this change, national and regional authorities would be responsible for financing healthcare, in the way they are now. In short, this proposal would help make the EU stronger on health, while still protecting Member States' powers.
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