MANAGEMENT OF THE SICK HEALTHCARE SYSTEM

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

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Service Charges for Patients

When we think of the charges in hospitals for medical services, we must emphatically realize that there are two clear-cut separate components in them. One is hospital expenses determining the hospital charges and the second is the charges of the medical expert / professional / specialist, the professional charges. Strangely the aspect of professional charges of the doctors is ignored not only by government institution but almost equally by charitable hospitals and private hospitals who give fixed salary to their specialist doctors. Actually, it amounts to the Marxian thesis of buying the labor (of the doctor) and taking the full returns of the product by the owner-the capitalist. The scheme does not work in this situation. Besides it is condemnable as far as any professional, be he a lawyer, C.A. or the like. Hence a look at the pattern of payment to the specialist doctors / medical teachers becomes imperative
.
First the principle must be accepted that there cannot be ‘free’ service from a professional. (Herein, we will restrict to the consultants / specialists / medical teachers).

It is generally said that 80% of the doctors treat 20% of the affording, affluent population while the remaining 20% of the doctors are burdened with the responsibility to treat the remaining 80% of the non–affording population. What does it mean? Presuming that there are 100 doctors and 2000 patients. Eighty of these doctors are treating 400 people; the ratio of doctor : patient is 1:5 The remaining 20 doctors are treating 1600 people. The ratio of doctor : patient is 1:80 That means he treats 16 times more patients than the former. Presuming that the former charge Rs. 100/- per patient (These figures are for showing the proportion, not actual), for the latter, only Rs. 6 have to be charged per patient, as he is seeing nearly 16 times the number of patients compared to his counter–part treating the rich. In short, whatever be the average fees charged by the doctors of the affluent class, a mere 6% of that amount will give the doctor of the poor, an almost equal monthly income. Presuming that a little lesser income will do, it is difficult to digest that a patient cannot pay rs. 5/- in small towns, where middle class pays Rs. 100/- and Rs. 10/- in cities where the average private charges are Rs. 200/- per visit. Even if it is presumed that the ratio has changed, and it is now 70% doctors for 30% affluent class and 30% for 70% of the poor, the ratio rises to 15% of the
charges by the former class, or a little less - Rs. 10 in small towns and Rs. 20 in cities. As mentioned and as will be discussed further in detail, there will be a good number remaining who must be reated free of charge, but in the case of these, some one else will have to pay the professional fees.Either the government or the many aid groups, trusts or N.G.O. s (including foreign NGOs.) or the students in the medical college must accept the burden of paying the professional fees. But in my opinion, professional services should never be free. They will be quite affordable to every one under the system, I am advocating.

It is high time, medical and consultant associations condemn all so called ‘free medical camps’. They are farcical and no one gains, everybody loses.

It is very important to give particular attention to the income earned by the doctor in public sector and maintain it at a comparable level, if not the same level, compared to the earnings of his center-part in private sector. There is an immense job satisfaction for a consenscious doctor while working for the real needy ill patients. Besides these is a greater security and many long term benefits in paid jobs and hence, he will easily accept some difference in his monthly income. But if the difference is too much, they are bound to leave the public sector or the medical colleges and crowd the private sector. That is what is happening at present. Overcrowding of doctors in private sector automatically leads to unindicated investigations and operations, costly medicines given to the patients for favouring companies (for a price, of course), and all sorts of mal–practices seen rampantly to-day. It is not presumed that all these mal-practices would be totally corrected. They will be minimised to a significant extent, as the public sector grows healthily on the sound principles of management. The healthy growth of public sector will create a healthy competition between the private and public sector. Also, the contribution of the poor patients for their own health-care, in the form of professional fees of the consultant, will help to retain many eatable consultants in the public sector field.

As far as the hospital charges are concerned, the poor strata, and the low income strata which largely seek medical services certainly need a lot of subsidy. Yet I maintain that the ser-vices should not be free, except for those below the poverty line, (after some sort of scrutiny and written exemption from an authorized person in the hospital).Nor should it be arbitrary, the so called ‘token’ charges, for they have no correlation to the actual expenses. If the ‘Gold-Card’ or ‘Smart – Card’ is issued to every citizen of the country, (a scheme which Mr. Nilekani (of Infosys fame) has been given charge of,) it will become very easy to decide how much subsidy who deserves. But there are two ways available even at present. Costing is not difficult. At least a crude costing exercise could be easily done for each of the services – O.P.D. visits, admission to wards, cost of X-rays and an average cost of standard routine investigations, and for operation and procedures. The new modern investigations like Endoscopies, C.T. Scan, I.C.U management will have to be individually valuated. The costs involve

(a) cost of original set up including construction cost and purchase of equipments etc. for the first time
(b) Annual costs including maintenance, repairs, and various taxes to government, electricity, water bill etc.
(c) The expenses on general staff from sweeper, ward boy to nurses, technician and administrative staff;
(d) specialized technical staff or specialized nurses in the case of all special modern equipments;
(e) consumables, depreciation etc. and
(f) the junior doctors (excluding the consultant / medical teachers, whose charges have already been dealt with)

Of these (a) and (b) must be borne by the government. On the other hand maximum effort must be made to collect the charges of consumables and standard depreciation of the equipments. (e) This is the most minimum recovery of the total hospital expenses incurred, which must be recovered. Then depending on the socio economic status, the charges of (c) could be recovered i.e. costs of general staff and technical specialist staff, as also (d) as will be applicable to sophisticated equipments and procedures, in modern high-tech equipments and must be recovered. As regards (f) junior doctors, it will be considered later. In general, till this exercise is completed, at least 10% to 15% of the expenses in each section of services must be charged to every patient. The rest of the expenses be subsidized by the government.

This is as regards taluka and district level hospital, the equivalents in Mumbai and other large municipalities being municipal hospitals. In the case of medical college hospitals too, should get as much subsidy as the patients in district hospitals. But in addition, the students pay about 30 % of the expenses incurred on them. For reasons to be discussed, the students should be paying, as much for their paying class patients (i.e. same as what they subsidies the general ward, in absolute figures). The charges for general ward patients then would be quite manageable. For those who can not afford there are many donor trusts, NGOs and religious bodies who are too willing to help patients in medical college hospitals or district level hospitals. As far as paying patients in medical college hospitals are concerned, it is accepted that the charges here cannot be and should not be equal to the charges in private sector. I have stated earlier that the patient who comes to the medical college hospital is particularly at a premium because of the presence of the medical students and the necessities of teaching and research. Also marketing in the public sector is very poor and hence they will not be able to compete with hospitals in private sector. They are expected to serve a relatively middle economic class, not elites or higher middle class. Therefore, these paying patients, too, deserve partial subsidy. Therefore, in addition to the partial payment by the medical students, subsidy equivalent to a) & b) should be equally justified. Besides, both general and paying class patients can get their investigations and therapy exempted (paid by the research company) if they agree to offer themselves for the research projects.

In addition the doctors professional fees could also be kept at about 75% of the average fees in the private sector. Thus, there will be a fair reduction in the cost of health–care for these middle class paying patients and that will hopefully balance the grudge and handicaps of medical students examining them and a relatively longer stay in the hospital. Overall, the paying patient will pay about 40% less in hospital bill and also 25% less in professional fees.

In short

1) free treatment should be abolished or at least minimized in medical college hospital as well as in all public hospitals :

2) all patients must pay some proportion of medical expenses, general ward patients must bear at least 10% of the expenses if not more. Such charge should not be mentioned as ‘nominal charge’ but should be strictly proportional to the full-fledged charge, as a fixed percentage. The public should be reminded that 90% expenses are subsidized and that the subsidy will be progressively removed as the economic condition of the population improves.

3) The investment required for the further expansion of the medical facilities to improve the services must necessarily be borne by the government or the Institution running the medical college.

In summary the present pattern of administration of the public hospital and the administration of the medical college is extremely irrational. The system gives unwarranted concession or subsidy to those who do not need it and leaves a wide scope for corruption. The fees of the medical students should be based on sound financial principles and the charges of the health care provided in the hospital must also be recovered appropriately from each of the beneficiaries namely the patients, medical students and the industries and the government. Poor people will benefit more than at present and education will also improve immensely. The subsidy will be given exactly to those who need it and in exact proportion they deserve. ‘From each according to his ability and to each according to his needs’ is the first principle of socialistic society. The hospital will become viable, the competence of medical staff would improve and the society will reap long term benefits for the next 2 generations.
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