Varlam Mosidze

Leading Expert, Head of the Health Care Program

Health Care Reform: The Beginning

On January 20th the new Minister of Healthcare Alexander Kvitashvili and the Mayor of Kyiv presented a pilot project of the reform.

Back in November of last year, an advisory group on healthcare reform released a draft of the Reform Strategy for 2015-2025. As of now, the project is under public debate. Meanwhile, the Ministry of Health together with the City Administration has launched the reform in Kyiv.
In Ukraine a healthcare reform is long overdue, not only government officials, but also doctors and patients are well aware of that. At the same time, government’s intentions often encounter skepticism, passive or even active resistance. The main reason for that is inertia and lack of understanding of mechanisms of change.
Officials promise to submit the Parliament a package of laws necessary to carry out the reform. However, they admit that there is no comprehensive system of measures. As a result, it is unknown how certain aspects of the reform will be fulfilled.
It is clear that cornerstones of the reform should be combating corruption, decentralization and optimization of the medical facilities network, and, most importantly, changing the principles of medical services.

Result-oriented approach

The system of medical institutions that are currently operating in Ukraine was inherited from the Soviet Union. During the twenty three years of independence the majority of Soviet achievements has been lost, but the shortcomings remain. Some of them are excessive bureaucracy, outdated technical base and neglect of patients’ interests.
As a result, majority of Ukrainians prefer either not to seek any medical treatment or do it only in extreme cases, often when it’s too late. Hence, we have one of the highest rates of mortality, morbidity and disability in Europe, as well as the lowest life expectancy.
One of the objectives of the announced reform is to change this situation by introducing principles of patient- and result-oriented approach. In other words, a patient will be able to choose a medical institution and a doctor, while money for his/her treatment will be directed to the chosen establishment. According to the authors of the reform, doctor’s paycheck will depend on the number of patients served by him/her. This system of profit is already in action, and is legal only in private medical institutions, whereas the official salary of employees of state hospitals is pitiable. The reformers stand for destruction of this scheme, introduction of market mechanisms and healthy competition. In order for these mechanisms to work doctors, patients and hospital administration have to be interested in them. It is impossible right now, since management of medical institutions is usually appointed from above and corruptly.
The Georgian healthcare reform is often mentioned as a successful example of solving this problem. Public health facilities were sold to private owners on auctions. In addition, private companies have built a hundred new modern clinics, in return the state provided them with the right to use the funds directed to certain groups.
It is difficult to say if, given all the differences, it is a good idea to apply the same project in Ukraine. Nevertheless, mechanisms encouraging hospitals and doctors to fight for a patient are vital.

Fight against corruption

Healthcare system is considered to be one of the most corrupt in Ukraine. It has plagued state procurement of medicine, staff appointment, from the Ministry to regional hospitals. Let’s not forget about extortion that follows patients’ treatment and even consultancy in the form of so called charitable contributions and a system of collective responsibility.
As the new Minister pointed out, the state buys health services, provides them and, at the same time, controls them.
Alexander Kvitashvili, who implemented the Georgian reform a couple of years ago, is trusted by experts and the public to overcome corruption schemes. However, it is likely that most of resistance will come from officials and doctors who are used to corruption.
The main factors of corruption in healthcare are low official income, encouragement of corrupt practices by the management of medical institutions and lack of responsibility. Thus, official salary increase that matches the experience, skills and effort, as well as the threat of dismissal or even criminal liability for bribery can if not eradicate it completely then at least reduce it significantly.
However, another issue is that not only officials and doctors, but also patients are used to the corrupt system.

Eliminating stereotypes

As of now it is unclear which funds will be used to cover medical services while the reform is being implemented. One of possible solutions is premiums. According to the poll conducted by Gorshenin Institute, 44% of respondents support the introduction of mandatory health insurance. The percentage is pretty high, but it still isn’t even half.
Since Soviet times Ukrainians have believed in the streotype that medical care is and should remain free. Moreover, for some people paying 250-300 UAH monthly for insurance (these are the conditions offered by insurance companies) may be too expensive.
Perhaps this is why the Ministry decided to give up the idea of mandatory health insurance, as announced by Kvitashvili on January 27th. It seems that the reform will be developed after an alternative solution to mandatory health insurance. The so-called “basic package” of health services will be introduced, it will be available for free for everyone who needs it. According to the Minister, the best option for Ukraine might be a “mix” of different funding sources: state and local budgets, insurance premiums and targeted programs.
It is possible that this option will slightly reduce the social tension that could be triggered by mandatory health insurance. Even so, in order for the reform implementation to be successful officials, volunteers and media should increase public awareness. Moreover, rights should be explained not only to patients, but doctors too. One of the reasons why healthcare employees may boycott the reform is fear that while they are all-powerful today tomorrow they may be completely powerless. In this case legislators have to ensure the balance of interests of doctors, patients and control and regulatory bodies.
The new Ukrainian government was given an unprecedented mandate to carry out reforms. However, this mandate won’t last forever, so reforms should be implemented vigorously. The healthcare reform is one of them, since the level of medical service is one of the main indicators of the state development.