Afaal’s Column

The government funds the public health care sector in the Maldives, as we all know. In fact whatever care that is provided by the government outside of Male’ is actually FREE! People had to pay a minimal amount for some x-rays and scans. So in a typical health post or a health centre, there is no cost recovery. In the atoll and regional hospitals the recovery will be about 4% maximum. The problem though is the non-availability of medicines, and the huge cost of travel. The issue with medicines is that Maldives has a competitive market for pharmaceuticals that is completely private. Some may say STO, one of the largest distributor is not private, to which I do not fully agree since that is public company that operates on a free market. This is more like the US health system. Large percentages of people don’t have access i.e. medicines are too expensive as well.

When it comes to seeking health services in Male’, where more sophisticated medical care is available, the costs are much much higher. First the main complain is that health care is very expensive. Why? Because we have to pay out of our pockets. Expert opinion on this is that out-of-pocket payments are the most regressive financing system in the world. Despite this, IGMH is also heavily subsidized and recovers only about 40% of the expenditure.

In year 2001, I wrote my Masters dissertation titled “Healthcare Financing – a case for Reform in the Maldives”. My research looked at the insurance schemes available at that time in Maldives and did an analysis to propose a conceptual model for a social health insurance scheme. My proposal was a national scheme that is accessible and open. Although will not go all out to insure every single citizen in the country but provide a competition in the insurance market.

During the first insurance scheme introduced, which collapsed before it even really started, I happened to work for the Technical Committee. I wrote a concept paper that the Committee submitted to the government. Two important prerequisites for the scheme that I proposed in the paper was a legal framework and awareness creation, none of which was implemented before the scheme was put into effect. If these prerequisites were met, that scheme could perhaps have its benefits even now. But that is now history and most of you know the reasons for the collapse of that scheme through the media.

Now in the current political environment, health care is high on the agenda of many presidential manifestos. Some providing free health care, some looking at a contributory mechanism, some building more hospitals and the previous government introducing a scheme just one month before the election etc.

Some fundamental points I note is that, from researching the worlds most advanced and advancing health systems, “free” health care is not attainable. Nor can any country achieve the perfect health care financing system. For the Maldives the biggest opportunity is to learn from the failures of the others. We tend to fall into the same pits that people fell many years ago. Our solution shall have strategic direction, one that is sustainable and benefits generations to come. Not just an election promise.

Ideally, the way I see it is that we need the following.

1. A solid legal framework – especially one that looks at consumer protection and simultaneously protecting the providers from heavy financial losses.
2. A vigorous campaign to educate the public on health insurance. I believe that we are really not aware of the benefits, exclusions and possible consequences and of course the fine print. For example in my first hand experience, the two tourists in Male’ were badly burnt during the Sultan Park explosion and their insurance company did not cover even one cent of the treatment, both here and in the UK.
3. There should be a nation scheme administered by a government authority but shall not attempt to cover every citizen of the country. The national scheme should cover the civil service, the poor (we do not have a proper poverty line and a mechanism to identify the real poor) and the unemployed (again a grey area) and the retired. Employers should also have a responsibility for health care of their employees. The current Employment Act failed badly on this provision (one of the failures of the Act amongst many).
4. The scheme should invest generated capital and continuously enhance the system from the profits. Should have 100% transparency and independent audit reports published nationally.

I believe that there is no such thing as FREE health care. Do u ever get a free ride?

(This article was initially published on my old blog at afaal.blogspot.com on Thursday, September 25, 2008. I have republished it with some modifications)

Is there any such thing as free health care? Or is it just an attractive jargon that pleases people? Health care is a basic right for every citizen of every country and Governments are supposed to provide appropriate access to services, a statement well understood by everyone!

In the recent past there has been a lot of talk about health care reform in almost all corners of the world. Health care reform becomes a major talking point of each political election. In the 1990’s economists in their quest to find better and efficient ways to finance collapsing health care systems started the health care reform jargon. With advancement and sophistication in health care interventions, escalating costs left governments and the public struggling to afford health care and hence more and more people did not have access to health care, even in the developed world.

If we look at the most advanced health systems of the world for example, the United Kingdom is one that boasts “free” health care. But the National Health System (NHS) of the UK have in the recent years struggled to cope with the costs and slowly are moving towards a more market based system. Free health care is mainly seen in economies with high taxation. However even with this, there is division for example in the UK Labour Party whether to introduce a new health tax to supplement the already expensive over 53 billion pounds NHS budget (The Guardian, November 30, 2001). Who pays? The people! Do we call this ‘free’ health care? Experts agree that the UK health system is on one extreme of financing spectrum, not a very good one.

On the other extreme in the US where health care financing is based mainly on private insurance. This system has left millions without access to health care. Why? People can’t afford healthcare. No wonder, health care becomes a major campaign slogan of every American election. In the present presidential campaign in the US, Barrack Obama is proposing government subsidies on the current expensive market based system (Times, September 29, 2008). According the expert consensus, US has one of the most regressive health care financing system in the world.

Countries like France have made their health systems more responsive by innovation. Social Health Insurance schemes with co-payments and capitation have improved the sustenance of their systems. However, still there are questions about such systems. For example in the last election campaign of the previous Premier of Australia, John Howard in his campaign promised ‘free” healthcare for all Australians. But just 3 months into him term after election, he raised the health care tax rate – his answer to the public? If the government implemented free health care Australia will go bankrupt and he said something along the following lines “I’m sure Australians will forgive me since my financial advisors were wrong at that time. I cannot make Australia go bankrupt just because I made an election promise.

Coming to the context of the Maldives which is what we need to get worried about, we have has a system that is extremely regressive. Out of pocket payments have made people beg for health care. Many families have gone into unrecoverable debt since they had to borrow for health care. However, slowly the concepts of insurance are creeping into the country. A good sign, but how sustainable is it? We saw the first Government Employees Insurance Scheme collapse before even it was really born. A bitter experience! Now the new scheme “Madhana” is claiming that it is a more promising scheme. We have to wait and see.

Failure of the government to implement a proper scheme to finance the Maldivian health care system, the current political environment have made health care financing one of the talking points. Some of the candidates promising ‘free’ health care! I will write a second part of this article shortly. The Maldivian context.

(This article was initially published on my previous blog at afaal.blogspot.com on Wednesday, September 24, 2008. A modified version of this was also published at Dr. Waheed’s blog on Thursday, November 27, 2008)