When public healthcare is in crisis, is equitization the solution?

July 18, 2022 | 04:58 pm PT
Quan The Dan Doctor
In 2005, I was appointed head of a hospital department. I was thrilled because most of my predecessors were close to retirement when this happened and I was just 40.

I wanted to do my utmost to make this hospital a better place for everyone.

The zeitgeist at the time was economic growth. As society shifted gears, the field of healthcare was also caught up in the momentum. The shift was much needed in an area that had become infamous for its old-fashioned ways.

Back then, there was this project to equitize the Binh Dan Hospital in HCMC that became the talk of the town. Many hoped it would usher in the wind of change needed to resolve many long-standing issues in the field.

I wrote an article then calling for changes at the hospital that received much support from peers. I was unanimously voted to become the hospital's civil inspector to oversee the proposed changes.

But I learnt much later that the day I was voted into my position, the board of directors had a private meeting that referred to the vote as a disruptive event that I had instigated.

In 2007, the equitization plan was scrapped. The wind of change had been diverted.

Now, I see that the same old issues from 15 years ago are very much alive. If anything, they have gotten worse. We're very much in a crisis right now. Official after official is getting arrested for corruption involving hundreds of billions of dong.

In the 21st century, people are no longer arguing whether a market economy or a planned economy is better. They have their pros and cons, and it’s our job to take the best of both and use them together.

At the end of the day, healthcare is a service whose growth is subject to the invisible tugs and pulls of the market economy. We can see it happening in real-time: healthcare departments with high demand attract more talent and higher pay. The more reputable a hospital, the higher its revenue.

As much as we keep saying that healthcare comes with moral obligations, a hospital can only survive if it is economically feasible. Without money flowing in, hospitals will simply be wiped out from the market.

Current treatment fees at hospitals don't cover all the costs involved. So why aren't hospitals dying? The answer is that they are sustaining themselves through other means like tax and payroll support from the government.

And finally, as much as it pains me to admit, corruption does play a role in keeping hospitals alive. In my opinion, this corruption is a twisted, self-arising mechanism to resolve inherent inefficiencies in running a hospital in our country. I do not condone corruption itself, but I am aware that its prevalence in the healthcare sector is simply a reflection of an underlying, systemic issue.

The healthcare system as it is would crumble without the factors I have mentioned.

So where do we go from here?

Fifteen years ago, people had already realized that a strong, healthy healthcare sector must be diverse, including public, private and non-profit sectors. But the idea of equitizing a public hospital would have been a very bold move then.

Private healthcare is the consequence of a market economy, and despite the criticism from certain quarters, is thriving. Today, it is now an important part of Vietnam's medical system, and its role will only get bigger from here. In many ways, it is the private sector that has pushed the public sector to step up its game. For the first time in a long time, public hospitals have had to ask themselves how their private counterparts are able to make money despite paying a lot for equipment and workers' wages.

Some people are worried that privatization of the medical field would lead to higher medical fees. But the so-called "low" fees that public hospitals charge are only a part of what patients actually have to pay if all costs are to be met. Prices at a private hospital, meanwhile, are transparent and in-your-face. People are beginning to absorb this.

In the future, hospitals would have to compete with each other and the invisible hand of the market economy will guide them. This is not to say that the government will play no role. It has to regulate the sector with various mechanisms like health insurance and price ceilings.

The equitization of state hospitals can help reduce management burdens and give them access to new funds and new ways to operate. Their employees, with stakes in the hospitals doing well, will contribute more. Corruption would subside, hopefully; and the state would be able to gain a huge amount of resources through equitization, enabling greater investments in better infrastructure and equipment.

This has been the practice around the world for a long time. People in Vietnam have also been talking about it for several decades now.

Maybe the time has come to walk that talk.

*Doctor Quan The Dan is deputy director of Tri Duc Thanh General Hospital in Thanh Hoa Province. The opinions expressed are his own.

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