PHA-Exch> Food for an old, but still currenrt, faulty thought (1)

[Claudio Schuftan]

Human Rights Reader 205



*HEALTH SECTOR REFORM MEASURES: HAVE THEY WORKED?... AND WHERE DO WE GO FROM
HERE?  *(Part 1 of 2)



1. If one is skeptical about whether health sector reforms (HSRs), pretty
much applied worldwide, have worked, perhaps the time has come to be bold
and to ask some hard questions.

2. You are, of course, aware that some of what has been proposed as HSR
measures have often basically been Structural Adjustment measures in
disguise. Other HSR measures proposed called for changes that were
politically unsavory and took a strong determination to get under way.  Ergo,
often, implementation plans stayed in the drawing board stage only.

3. If one does not look at HSRs critically in time, one can miss the point
that HSRs have really come to mean "market oriented interventions in the
health sector".  The concept has literally been 'hijacked' by what one could
call a 'World Bank-led paradigm of health reforms'.   It is thus of utmost
importance to address the underlying assumptions being made about
market-oriented HSRs as they are still being promoted around the world.

4. For starters, the WB-spread evidence that market-oriented health care is
more efficient than public health care does not even pan out in countries
such as the US with its already highly market–oriented health care
system.  Twice
as many financial resources have to be used in the US to provide the same
quality of care as European countries are providing.  This indicates that
huge inefficiencies remain in market-oriented health care; i.e., it is still
profitable to provide unnecessary care…  (According to the US Government
Accounting Office, a Canadian style single payer system could, already in
1994, have saved enough administrative overhead to cover all the uninsured
and could have eliminated all copayments and deductibles in the US. The
single payer approach would have sharply cut the $50 billion spent annually
on US insurance companies overhead alone).

5. Consequently, we need to be aware that evidence from many countries
indicates that public health care *can* be, not only more equity-oriented,
but also more efficient than market-oriented health care systems.

6. This does not imply that all public health care systems are efficient.
Inefficient public health care systems can indeed be made more efficient by
improving relevant public policies and by simply allocating the needed
resources to the sector. Therefore, embracing a market orientation is not
the preferred way to improve health care for most people.  Reforms being
proposed to strengthen public health policies and public financing of health
care via taxes are being gratuitously dismissed as supposedly being
'non-viable' as a realistic option for the future --obviously a groundless
dismissal.

7. This dismissal is reinforced by the contention of mainstream health
economists that the role of government is 'to adjust the market failures'
found in the health sector.  The assumption here is that a 'perfect market'
will provide the best health care system.  But this implies that demand
(purchasing power) should ultimately determine the supply and utilization of
health care services. But, let's face it,  it is impossible for a perfect
market to provide health care services according to need --regardless of
ability to pay.  Only if the groups with the greatest need for care would
also be those with the most resources for buying the care they need would
'the market' be a possible regulator of access to care.  But in reality, the
opposite is the truth, i.e., the economically least privileged groups are
the ones with the greatest disease burden thus having the greatest need for
care.  If we yield to this reality, we are left with no choice but to look
for ways to improve the public health care system, the one that can cater to
the health needs of those with less ability to pay.  [This contention does
not exclude a role for a well regulated parallel private-for-profit health
care sector that follows market forces primarily catering to the needs of
the most privileged groups].

8. The main concern for HSR must continue to be to secure quality health
care services for the great majority of the population thus reducing social
inequities in terms of economic, geographic and ethnic access to care.
 Consequently,
we strongly feel that the focus of an *equity-oriented HSR* has to be to
gear scarce financial and skilled manpower resources to achieve this
objective.



9. Let us now review the shortcomings and future opportunities we see as
they relate to the overall objective of developing an efficient,
equity-oriented health sector reform.

Risking being brief to the point of a caricature, a number of truths on the
shortcomings of  HSRs (as currently being applied worldwide) HSRsHSRscan be
found in some of the statements that follow:

·       There is no current evidence of sustainable financing of health
systems for the poor people in poor countries without governments providing
significant support.

·       Government financing of the health sector in developing countries is
at best stagnating and, at worst, declining.

·       Salaries of rural health personnel more often than not puts them at
the threshold of poverty, and their technical skills are out of date.

·       Workshop-based training for this personnel is mostly an income
source and may increase their knowledge, but is not an effective approach to
changing their practices!

·       Health staff is sometimes involved in the private sale of drugs
--most often non-essential drugs.

·       The percentage of the population self-medicating has been increasing
across the globe, and uncontrolled drug sales by market vendors is on the
rise; (weak) essential drug programs are suffering as a consequence.

·       Revolving drug funds have a nag for not fully revolving, therefore
slowly  decapitalizing themselves; mark-ups simply do not cover the costs of
the drugs dispensed to exempted patients.

·       Fee for service PHC services worldwide are facing a new threat: the
established infrastructures are being underutilized.

·       The fee for service system is a form of regressive tax in which the
poor pay as much as the non-poor. (High user fees for health are, at
present, a major cause of pauperization of the near-poor!).

·       Becoming sick thus penalizes the poor more as disease becomes a
greater economic burden for them than for the better-off, even when the fees
are waived for the very poor.

·       Private wards in public hospitals --supposed to subsidize the costs
of care in adjacent public wards-- end up being subsidized by the public
purse that thus subsidizes the wrong group: the economically more privileged
groups that use these private wards.

·       Short of deliberate government subsidies, prepayment schemes (health
insurance) are not working for the growing proportion of urban poor and for
the rural population.

·       Equity in the provision of quality health care services has been
regressing for over two decades, most probably both in the developing, as
ell as in developed countries.

·       Governments have been slow or non-responsive to remedy most of the
above (well known) situations hoping that a shift of the health sector
towards a market orientation (including privatization) will solve these
problems.

·       Donors have not always reacted fast enough (or at all) to these
shortcomings either, and there are renewed signs of donor fatigue.

*--The perennial problem in the taking of decisions affecting all the issues
above is the limited involvement of the beneficiaries themselves in such
decisions! *

10. Many of the strategies of health sector reform have been designed
top-down to, in a targeted manner, address a good number of the situations
listed here. But providing what kind of solutions? Are most of them amenable
to market-oriented solutions?  If yes, how have they fared? Realities in
developing countries show that, so far, they have not fared so well...  But
then, what does 'so far' mean? Is it just a matter of more time for things
to turn around for the better?  The more radical corresponding questions
are: Is the HSRs agenda in need of a (long overdue) face lift?  Or, do most
poor countries need a different brand of HSR?



Claudio Schuftan, Ho Chi Minh City,    cschuftan at phmovement.org

Goran Dahlgren, Stockholm,                  dahlgren38 at telia.com

[All Readers can be found in www.humaninfo.org/aviva  under No.
69<http://www.humaninfo.org/aviva%20%20under%20No.%2069>
]
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