MANAGEMENT OF THE SICK HEALTHCARE SYSTEM

( By Dr.S.V.Nadkarni, M.S. )

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Effective Fees for Medical Education

When we consider the fees to be charged to the medical student, two important aspects must be taken into consideration.

(1) expenses incurred by medical colleges and
(2) the various means other than student fees that can bring income to the Institution.

If the medical college indulges in unnecessary expenditure, such an extravagant expenditure need not be taken into consideration by the board. The Indian medical Council has clearly stipulated the space, furniture and the infrastructure for each department. Expenditure incurred on these is the most essential expenditure. Additional expenditure can also be allowed only if it can be proved to be important to qualitatively or quantitatively improve the standard of medical education. Generally I must accept that there is not much scope to reduce the expenditure on these grounds from the present level. But the expenditure on the salaries and perquisites for the medical teacher can be comfortably reduced by allowing the medical teachers, private practice on the premises on the 25% beds reserved for the paying class as discussed in details earlier. Medical teachers will get minimum salary for teaching as in other faculties, but he will earn more and more with his own skill through the private practice and the management need not pay for the perquisites such as non-practicing allowance, telephone, housing etc. In addition, there are possible sources of income other than the students fees. First major source is income from paying class of patients. 25% percent paying class patients can bring enough income both to the senior medical teachers and to the hospital. Even a hospital like Bombay Hospital can afford to have about 25% beds free of charge or highly subsidized. Therefore, much of the hospital expenditure can be expected tobe recovered from the 25% paying class patients. Another source of income is Research Grant. One of the important functions of a medical college is research and large sums of money are allotted by pharmaceutical companies and medical equipment companies in private sector and the University Grant Commission(U.G.C.) and Indian Council of Medical research (ICMR) in the public sector but these are most scantily used. Used appropriately the medical college can earn lakhs of ruppes through research. I was told the Manipal University has more than 80 research projects bringing in over 6 crores of ruppes to the institute through research grants. Government hospitals especially are apathetic in utilizing these funds. Yet research is carried out but the funds are exploited by vested interests by clandestine methods. The hospital earns nothing. Yet another source of income could be the training courses for all paramedical services. There is need to have nursing course, technician’s course and even training course for ward attendants. Even administrative courses like MBA, Cost–Accounting, record keeping etc. could be undertaken with the help of the respective bodies in the various fields. There is no need either to extend the infrastructure or teaching staff and the same premises and the same staff can be used to conduct the training programmes for different paramedical services. As will be discussed later, the concept of absolutely free medical treatment must also be curbed; not so much for earning money but for many other vital reasons. However, suffice it to say here that some income would be added if general ward patients are also charged even 15% of the actual bill. I have already stated that the private medical colleges should also be entitled to a subsidy equivalent to the expenditure incurred by government in a district general hospital. If all these sources of income are properly used, the burden of fees on the medical students will be remarkably reduced and I believe that medical education would not remain as costly as it is today.
In summary, the following steps are needed to streamline the fees structure and bring the fees down to a reasonable limit.

  1. there is no justification for very highly subsidized medical education in government medical colleges and exorbitantly high fees in private medical colleges. The fees in government medical colleges should be at par with the private medical college fees or based on expenditure incurred, as in the case of private medical colleges and approved by the board appointed by the government. There should be no distinction between the two.
  2. No student with merit should be denied admission to the medical field because he/she cannot afford. Therefore, irrespective of whether the student joins government or private medical college, he will be entitled to a certain amount of subsidy depending on financial circumstances of the family. The families with income of Rs. 75,000/- per month and above will pay full fees. But the families with income between Rs. 60,000/- and Rs. 75,000/- will get 25% subsidy. The families with income between Rs. 40,000/- and Rs. 60,000/- will get 50% subsidy. The families with income between Rs. 25,000/- and Rs. 40,000/- per month will get 75% subsidy and those below Rs. 25,000/- income per month will get full freeship i.e. 100% subsidy. The admissions, however, will be strictly on merit.
  3. While determining the fees, only the legitimate expenditure by the hospital for under- graduate and post-graduate studies should be considered. The burden of unnecessary extravagant expenditure cannot be put on the students.
  4. The hospital must keep atleast 25% of the total beds in every clinical unit for paying patients. There is no need to charge these patients exorbitantly to compensate the general class patients. They will be charged appropriately as per costing. For the general ward patients, the hospital / management will be entitled to a subsidy from the government equivalent to the amount spent on an average on patients in district hospital. In addition all general ward patients will also be charged atleast 15% of the expenditure actually incurred. Reserch grants will contribute further to the income of the hospital. The remaining excess expenditure will be borne by the students and will form part of their fees. It is expected to be not more than 30-35 per cent of the actual expenditure on patients.
  5. As the hospital is going to have 25% paying beds the consultant doctors / medical teachers will also earn directly as per their skill. It is expected that this would reduce the expenditure incurred on the remuneration for the medical teachers; especially on perquisites. It should be noted that the salaries of the medical teachers form a major bulk of the total budget for the medical college and its hospital.
  6. Medical college must make efforts to have research projects and earn some specific added income through the grant for research by the government, industries or other agencies. The consultant medical teacher undertaking the project must get paid appropriately.This aspect will he discussed again later.
  7. The number of students getting subsidy are not expected to rise above 40% to 50% In fact, those getting full freeship and upto 50% subsidy are expected to number 25% of the total admissions. But it should be noted that even if the number exceeds this figure, the total expenditure of the government on medical education is likely to be reduced and not increased from the present level of expenditure. However, if the situation demands the government, through the nationalized banks like State Bank of India should offer education loans to the students which will be repaid from one year after completion of education, over a period of 10 years. (This factor will have to be taken into consideration while determining the salaries of the doctors in public sector and will be discussed later.)

     

If legitimate principles of income and expenditure are strictly followed, I expect that fees for the medical education may not exceed Rs. 1 lakh per month. In addition this financial regulation will help a good deal to improve the standard of medical education. It may also help in reducing the overcrowding in government teaching institutions.

Free treatment is the Costliest treatment, with poorest returns.


Free treatment is becoming the costliest treatment. The results of free treatment in public hospitals are disastrous. Neither the doctors nor the students nor the patients become aware of the cost involved in the management of the disease. This is the most disastrous effect of the so called free treatment. Secondly as explained, earlier if the hospital budget is spent through tax money, hardly 13 to 15 paise remain available for the actual hospital expense from every rupee collected by taxation. If the money was collected in one form or the other more directly, the effective amount available for the health care system would become two to three times more than what is available now. The third adverse effect of the free treatment is that the whole management is in the hands of bureaucrats who have very little knowledge and expertise in this field. The allocation and utilization of the funds, therefore, is very haphazard. While C.T scan and M.R.Is. are installed, the simple drungs like anti T.B. drugs, antibiotics etc. are not available for the patients. But the worst effect of free treatment is that the medical professionals work on a fixed salary 'that too quite meagre, compared to the number of years they have spent and efforts they have made to qualify. So, many ethical and able doctors leave the paid jobs and enter the field of private practice which is considered both lucrative and satisfying. Those who remain, work without enthusiasm or zeal. As long as the medical officer attends on time, it makes no difference how much he works and how different he is qualitatively from the others. The fixed salary, total lack of incentives and extremely poor administrative supervision result in totally demotivating the doctors. They get very poor job satisfaction and such demotivated doctors with fixed pay cannot serve the people properly. In fact, many develop a severe antagonism to the very patients they serve and this gets transmitted to their juniors and students. The laxity in administration makes it very easy for the same doctor to look for the greener pastures, start private practice (allowed or not allowed by rules of service) and earn directly. This again makes him even less available in his primary field of government hospital or medical college hospital as the case may be. As the income of the doctor is totally independent of the service he renders or the satisfaction of his patients, the most needed doctor-patient relationship never develops. Thus, he becomes apathetic and oftentimes quite rude while treating his own patients. On the other hand as the patient himself never pays for his treatment, his own (idle) expectations keep rising without his own inputs. In our democratic set up, the number becomes important and the large population or their leadership keep demanding more and more facilities. The medical 'market' is always too eager to sell, keeps advertising more and more about the newer equipments, drugs, prosthetic supports etc and the politicians and the beurocrats easily succumb to the pressure from both sides. Thus, the government hospitals keep adding costly equipments without considering whether they are going to be really useful to the people. The limited resources available with the government are thus spent on unnecessary modern equipments leaving no money for spending on the more essential simple drugs and equipments. While a free class patient may get his C.T. scan or endoscopy free, he has to pay from his pocket for the simple investigation of haemogram and blood sugar. More often, the free C.T. Scan or Endoscopy is usefully exploited by the influential or affording class, leaving the poor where they are. He has to buy medicines from his pocket for his diabetes, blood pressure or antibiotics for his infections. This paradox is seen every day in almost every hospital throughout the country. Yet it is not realized that the root cause for this paradox is the so called free treatment as explained in details above. Therefore, this system needs to be drastically changed.

It is not, as though the system of, doctors on a fixed salary basis, can not work at all. But such a system of ‘paid’ doctors can work only if the management is excellent. The management has to define the role of each doctor, and each strata very precisely and set up defined targets for every specific aspect of his work. It must have an excellent ‘feed-back’ system and must get monthly reports (verifiable through good supervision) about the performance of each item and work through is M.I.S. (management information services) as it is called such reports must be to give salary rise or promotion (or demotion or dismissal). An additional ingredient required is honesty and integrity among the majority of the administrative and professional staff. With adequate salary structure along with such superior management skills, the system of salaried workers (doctors) can certainly work. We are nowhere near this.
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