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Articles of interest
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by Kent Pinkerton
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Vaknin
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uk.
Healthcare Legislation by Sam
Vaknin
Healthcare legislation in countries in transition, emerging
economic, and developing countries should permit - and use economic incentives
to encourage - a structural reform of the sector, including its partial
privatization.
Private health insurance plans - including franchises of overseas insurance
plans - should be allowed, subject to rigorous procedures of inspection and to
satisfying financial and governance requirements. Such competition is bound to
shake the inefficient and corrupt state Health Fund and reshape it.
Procurement of medicines - should be transferred to an autonomous central
purchasing agency. Both this body and its tenders will be supervised by a public
committee aided by outside auditors.
The Approved List of Medicines - will be recomposed to include generic drugs
whenever possible and to exclude expensive brands where generics exist. This
should be a requirement in the law.
To maintain their license to practice medicine, medical stuff - from nurses to
doctors - would be required to acquire continuing education and to publish in
peer reviewed papers. To prevent nepotism and corruption in appointments of
doctors to jobs in clinics and hospitals, all positions from ward doctor upwards
will be subject to periodic review and open, public tenders.
The law should explicitly allow for the following arrangements with the private
sector for the provision of healthcare:
Service Contract (Dominican Republic)
The government pays private entities - including doctors - to perform specific
healthcare tasks, or to provide specific healthcare services under a contract.
The private service providers can make use of state-owned facilities, if they
wish - or operate from their own premises.
Payments by the government are usually based on capitation (a fixed fee for a
list of services to be provided to a single patient in a given period, payable
even if the services were not consumed) adjusted for the patients' demographic
data and reimbursement for fee-for-service items.
Management Contract (Cambodia)
The government pays private entities to manage and operate public health care
facilities, like clinics, or hospitals.
Lease (Romania since 1994)
Private entities - including doctors - pay the government a lump sum or monthly
fees to use specific state-owned equipment, state-employed manpower, clinics, or
complete public health care facilities.
The private entity is entitled to all revenues from its operations but also
bears all commercial risks, is responsible for management and operations and
liable for malpractice and accidents.
The state is still responsible to make capital investments in the leased
facility or equipment - but maintenance costs are borne by the private entity.
Concession and Build-Operate-Transfer (BOT) (Costa Rica)
Concession is exactly like a lease arrangement (see above) with one exception:
the private entity is responsible for capital investment. In return, the
contract period is extended and can be voided only with a considerable
pre-advice.
In BOT (Build-Operate-Transfer) and ROT (Rehabilitate-Operate-Transfer) the
capital investment involves the construction or renovation/upgrade of new
healthcare facilities. The private entity uses the constructed facility to
provide services. After a prescribed period of time has elapsed, ownership is
transferred to the government.
Divestiture and Build-Own-Operate (BOO) (Texas, USA)
The law should permit the outright sale of state- owned health care facilities
to a qualified private entity.
Another possibility is a BOO scheme, in which the private entity contractually
undertakes to add facilities, improve services, purchase equipment, or all
three.
Free entry
The law should allow qualified private providers to operate freely. Though
regulated, these private firms will have no other relationship with the state.
Such entities would have to be licensed, certified, overseen, and accredited for
expertise, safety, hygiene, maintenance, track record, liability insurance, and
so on.
The state may choose to encourage such providers to locate in specific regions,
to cater to poor clients, or to provide specific healthcare tasks or services by
offering tax incentives, free training, access to public facilities, etc.
Franchising (Kenya, Pakistan, Philippines)
A private firm (franchisee) acquires a license from and shares profits with the
franchisor (a domestic, or, more often, foreign firm). The franchisee uses the
brand name, trademarks, marketing materials, management techniques, designs,
media access, access to approved suppliers at bulk (discounted) prices, and
training offered by the franchisor. The franchisor monitors the performance and
quality of service of the franchisee.
This model works mainly in preventive care, family planning, and reproductive
health.
The World Bank ("Public Policy for the Private Sector", Note number
263, dated June 2003):
"Franchisers in the health sector, often supported by international donors
and nongovernmental organizations (NGOs), establish protocols, provide training
for health workers, certify those who qualify, monitor the performance of
franchisees, and provide bulk procurement and brand marketing."
Hospital Management
(See separate document)
The law should allow:
I. Colocation of private wing within or beside public hospital
II. Outsourcing non-clinical support services
III. Outsourcing clinical support services
IV. Outsourcing specialized clinical services
V. Private management of public hospital
VI. Private financing, construction, and leaseback of new public hospital
VII. Private financing, construction, and operation of new public hospital
VIII. Sale of public hospital as going concern
IX. Sale of public hospital for alternative use
X. Consolidation of redundant public healthcare facilities by merging them or
closing down some of them
Private Sector Healthcare Monitoring and Regulatory Agency
The law should provide for the establishment of an agency to monitor and
regulate private sector healthcare provision: compliance with contracts,
servicing the indigent and the uninsured, imposing sanctions or
"step-in" rights, and dispute resolution.
Voucher System (Nicaragua)
The law should allow for experimenting with novel payment and resource
allocation techniques, such as vouchers distributed to needy populations and
guaranteeing free basic service packages provided by a limited list of clinics
or other healthcare facilities. Such schemes can also be managed by the private
sector.
Medical Savings Accounts (Singapore)
Contributions by employers and employees accumulate over time and are used,
tax-free, to pay for hospital expenses in public and private hospitals, national
supplementary health insurance premiums, special procedures (including abroad),
and expensive outpatient treatment and drugs for the saver and his immediate
family.
Consumer Organizations
The law should encourage the formation of consumer organizations in the
healthcare field (such as buyers' clubs or Health Maintenance Organizations-HMOs).
These groups will shop and tender for the best, most reasonably priced, and most
efficient healthcare services for their members.
Devolution
Responsibility for the provision of some types of healthcare services and the
allocation of inputs should be devolved to local authorities (municipalities).
Performance and Payments
The central authority should impose minimum performance targets in performance
agreements on all healthcare facilities, both public and private. All payments -
wages included - will be tied to these targets and their attainment.
Payment options should include:
Capitation - A fixed fee for a list of services to be provided to a single
patient in a given period, payable even if the services were not consumed,
adjusted for the patients' demographic data and reimbursement for
fee-for-service items.
Diagnosis Related Group (DRG)
Resource-based Relative Value (RBRV)
About the Author
Sam Vaknin ( http://samvak.tripod.com
) is the author of Malignant Self Love - Narcissism Revisited and After the Rain
- How the West Lost the East. He served as a columnist for Central Europe
Review, PopMatters, and eBookWeb , and Bellaonline, and as a United Press
International (UPI) Senior Business Correspondent. He is the the editor of
mental health and Central East Europe categories in The Open Directory and
Suite101.
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