Posted by Gustavo Silva Cano on Feb 8, 2010 Leave a comment

Saving Colombia’s imperfect healthcare system

Colombia news - heart monitor

Colombia has been having its own healthcare debate. If you have been reading Colombia Reports, you will know that two weeks ago the Uribe administration issued a series of highly controversial decrees on reforming Colombia’s healthcare system. These new rules inflamed the ire of many Colombians and put the government in a very uncomfortable position, adding misery to President Uribe’s unlucky last couple of weeks.

The users of Colombia’s healthcare system are divided into two groups: those who pay for their healthcare plan with their own (and their employers’) money (the “contributivo” scheme), and those who get it subsidized with taxpayers’ pesos (the “subsidiado” scheme). According to the government, in 2009 there were 17.06 million Colombians registered with the contributivo scheme, while 24.3 million were in the subsidized plan. In addition, there is a list of medicines and medical treatments that all users of the healthcare system have access to. This list is called Plan Obligatorio de Salud (POS), the Obligatory Health Plan. In total, there are 63 public and private healthcare providers in Colombia.

Oftentimes, the users of the healthcare system are not satisfied with the treatment they receive. As the constitution lists the “right to healthcare” (derecho a la salud) as a fundamental right, every year a great number of patients sue their healthcare providers for refusing to cover certain treatments or medicines not included in the POS. The courts usually decide in favor of the patients, ordering that they be given the treatment they demand. Between 2006 and 2008, there were more than 346,400 such suits in the judicial system, with patients demanding some sort of surgery in 21% of the cases, and medicines 20% of the time.

The result has been an explosion in costs for the government and the private healthcare providers. Last December, nine of the fifteen largest healthcare providers said they were close to bankruptcy, and that unless the government came to their rescue, Colombia’s patients would have a lot more to complain about. Oscar Zuluaga, finance minister, estimated that the healthcare system needed around US$400 million to make the problem go away, but with the fiscal deficit already at a seven-year high, few doubted that drastic measures were necessary.

Enter the government’s decrees. The Uribe administration had Congress declare a “social emergency” over the healthcare crisis, thus allowing the executive to issue decrees on the issue without a vote in the legislature. Using this opportunity, the government raised sales taxes on tobacco, beer, and lottery tickets – by law, taxes on these three “unhealthy” things have funded much of Colombia’s health system for decades. Nobody complained about these new taxes except SABMiller’s top executives, owners of Colombia’s largest brewery. The company said the tax hike could mean job cuts and closing one of its production plants.

But that is not the decree that caused all the controversy. Colombians will continue to drink beer, smoke cigarettes and buy lottery tickets pa’ salir de pobres (to leave poverty behind). The real commotion was over the decree that orders patients to use loans, their savings, or money from their retirement plans to pay for treatments not included in POS. Another decree ruled that doctors who prescribed medicines or treatments that were not included in POS could pay fines of up to US$13,000. In other words, the decrees severely restricted the doctors’ professional judgment and autonomy.

I had never seen so many people criticize the government in unison and over the same issue. El Tiempo, Colombia’s leading newspaper, openly condemned the decrees, saying they were “regressive” and that they went against the “acquired rights of Colombians”. Semana, an influential magazine, also ran a series of articles criticizing the decisions. A group of students in Pereira booed Diego Palacio, the Minister of Social Welfare, calling him “murderer” while they sang around a fake coffin outside a room where he was giving a talk. On Saturday, a significant number of people took the streets to protest against the decrees, with a few thousand marching in Bogota, Cali, Medellín, and other cities. Their motto was: “health is a right, not a loan.”

The opposition used the public uproar in its advantage, with members of the Liberal Party and the Polo Democratico condemning the government. On Twitter, Senator Piedad Cordoba said that the decrees amount to a “massacre” of the healthcare system. Presidential candidate Gustavo Petro wrote an article, saying that “a true policy of death was written on the emergency decrees”. Instead, he proposes to create a “universal, free and public” healthcare system.

Wisely, the government backed down on some of its initiatives. This weekend, the US$13,000 fines for doctors were, rightly, removed from the decrees, and Mr. Uribe also said that only those in the upper classes would be required to pay with their own money for treatments and medicines not included in POS. The controversy is slowly dying away.

There can be no doubt that the whole affair was a huge overreaction. The Uribe administration was not trying to kill patients or to deprive Colombians of basic health services. Far from it. With the decrees, the government avoided the horrible tragedy that the bankruptcy of nine large healthcare providers would have created. No doubt, the decrees had some stupid articles in them, like the one levying fines on doctors, but the government listened to its critics and compromised on this issue. I can’t help thinking that out of the sixteen decrees the government issued, only two (no. 128 and no. 131) are the object of the controversy. The government did a poor public relations job explaining the decrees to the public, and let the opposition take control of the story. Now the administration is paying a political price for that mistake.

About the decree that makes citizens pay for treatments not included in POS, let me say two things: First, nobody really knows what the final list of treatments and medicines included in POS will look like. The government is supposed to issue the final list in June, so until then, nobody can be sure of what illnesses and therapies will be covered by POS. To yell that the government is condemning people to die is not only silly, but also premature. Second, to make people pay for some treatments may be the only way to stop the avalanche of lawsuits that damaged the system’s finances in the first place. Some judges have been all too willing to order needlessly expensive care for some patients. As the judges do not pay for those treatments with their own money, but with the taxpayers’, they do not see the need for austerity and cost efficiency. Their irresponsible largesse has put the entire healthcare system in jeopardy, and now Colombia is living with the consequences.

To Mr. Petro’s proposal to nationalize healthcare, I respond: no thanks. His plan is foolish and a real danger for the health of all Colombians. Perhaps socialized medicine works in many European countries, but in Colombia I would never put my health at the care of the state. Why? Between 2006 and 2008 the government’s healthcare provider (Instituto de Seguros Sociales) had way more lawsuits (97 for every 10,000 patients, see page 40) than any other private provider in the country (the second provider in that list had about 55 for every 10,000 patients). Just imagine what would happen if the healthcare of all Colombians was transferred to the public sector. I really do not see how Mr. Petro will win the presidency if he keeps making promises that will reduce the quality of life of Colombians. But of course, the Left does not realize this. Nor do they realize that the Uribe administration was bold enough to make the difficult decisions needed to save Colombia’s imperfect healthcare system.