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) HSRs can 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@phmovement.org
Goran Dahlgren, Stockholm, dahlgrengoran@hotmail.com