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Health-care system in poor shape

After the adjustment of national health insurance premiums and the amount of self-paid out-patient treatment charges incited controversies in September, the National Health Insurance Program (NHIP) was put under the spotlight.

Cathay General Hospital Superintendent Chen Kai-mo (陳楷模) seriously criticized the program for creating a situation under which physicians compete in conducting unneeded examinations or unnecessary surgeries in order to extract more money from the program.

Moreover, some individuals have questionable attitudes when seeking medical treatment. They see going to the doctor as a leisure activity comparable to going shopping. As a result, medical resources are seriously wasted.

In view of the severity of the problems, some individuals have even suggested that the national health insurance program might as well go bankrupt all together, so we can start from scratch.

At the same time in the Legislative Yuan, where the annual government budgets are under review, some lawmakers have also voiced serious criticisms of the health insurance program.

They accused the National Health Insurance Bureau (NHIB) of foul play whilst making the budget, giving out excessive public relations fees, and handing generous bonuses to its employees. They also criticized major hospitals for profiting by selling excessively priced drugs, wasting as much as NT$20 billion each year.

Local governments, spearheaded by the cities of Taipei and Kaohsiung, owe the bureau tens of billions of NT dollars, creating a serious financial problem in the insurance program.

It is probably not a good idea to shut down the program and start all over again. However, the time has arrived for the the current program -- which has been going for eight years -- to be placed under serious review.

Is the NHIP of Taiwan a social insurance or social welfare system? No clear definition was offered at the inception of the program.

If it is a social welfare program, then the goal of the system would be to assist a small minority with the collective assistance of the majority.

Then, each individual should be asked to pay only a small premium in order to receive the service and protection of the program.

Irrespective of the financial well-being of the program, the government would be responsible for any and all earnings and losses of the program, and the general public must not be held accountable in any event.

If the NHIP is a social insurance program, then each individual must pay a designated premium in order to help keep the program running. In fact the quality of the medical treatments and services received should also bear a relationship with the amount of insurance premiums paid.

Although the nature of the program is not clearly defined, the general public apparently sees the program as a social welfare system.

If the the monthly premiums take up a disproportionally high percentage of monthly wages, not only do the insured feel the financial burden, but economically disadvantaged families are excluded from the program due to an inability to pay the premiums.

Against a backdrop of a serious economic recession, some unemployed or low-income families simply can't afford the several thousand NT dollars of insurance premiums for members of the household.

According to statistics released by the NHIB, more than 300,000 individuals in Taiwan can't even afford to pay a few hundred NT dollars for insurance premiums each month. And 37 individuals owe more than NT$300,000 in premiums.

Under the circumstances, whether the premiums being charged are appropriate is an issue worthy of further discussion.

Since the NHIP's implementation, the program's expenditure on medical treatments has increased rapidly each year. In the first year, the expenditure was already about NT$200 billion. By the seventh year, the figure had grown to NT$330 billion. In view of such a surprising increase, no wonder the program is in the red and nearly bankrupt.

As a result, the insurance premiums were raised in September of this year to help alleviate the system's financial crisis.

However, anyone who examines the problems of the program in depth will see that raising premiums is not the only way to fill up the coffers of the program.

Consider this: Once the premiums were raised, the financial burden of the general public was increased. Yet, at the same time, the bonuses of the bureau's employees were raised. This act cannot escape condemnation and removes the legitimacy of supporting a hike in premiums.

Based on the facts revealed about the program, one can already see that if the waste of medical resources and practice of purchasing drugs at inflated prices can be effectively alleviated by reforming the system, the financial well-being of the program won't be aggravated to the point of near-bankruptcy.

Such reforms will not increase the financial burdens of the general public, so the public will surely support such reform measures.

To cure the problem of wasting medical resources, the key is in reforming the system. Chen Kai-mo has complained that making lump-sum payments to hospitals is an irresponsible way to do things. It is the equivalent of throwing out a cookie for the entire medical community to fight over.

To seek survival, the hospitals naturally give priority to increasing the number of operations instead of improving the quality of medical services in general.

Taiwan Health Reform Foundation Chairman Liu Mei-chun (劉梅君) indicated that the current system led to distorted medical practices under which hospitals fight fiercely as if they were armies.

As a result, commercialized hospital management controls medical professionals.

Actually, it is not only that a small number of physicians conduct needless surgeries and examinations and ask patients to make needless outpatient visits. The public's habits when seeking medical treatment also play a pivotal role in the waste of medical resources.

Before the NHIP came into being the public averaged only 12 hospital visits each year. But, since the program began, that figure has been raised to 14-15 times.

The frequency of hospital visits in Taiwan probably sets a new world record. Some people love to get medicine even when they don't need it, creating even more waste.

Moreover, some hospitals can purchase drugs at relatively low prices as a result of bulk buying. Yet, they still get reimbursements from the bureau at inflated prices, making hefty profits from the price differences.

According to a report released by the Control Yuan in 1999, the price difference came to about NT$26 billion each year. The THRF, on the other hand, estimates that each year major hospitals earn about NT$10 billion to NT$20 billion from this price difference.

Lawmaker Sisy Chen (陳文茜) highlights as an example the psychiatric drug Sinzac. She points out that the the price paid by the NHIP is NT$41.5 per pill.

But, the pharmaceutical company actually sold the drug to the hospital at NT$2.4 per pill. This means that NT$39.1 has been made from the price difference on each pill.

If the NHIB can make its review mechanism for drug purchases transparent, then it would be able to effectively prevent such practices.

Moreover, the bureau should be more active in collecting overdue premium payments. A total of NT$60.9 billion is owed to the bureau.

The amount owed by local governments is NT$28.5 billion. The remaining sum is owed by business entities and individuals.

If these overdue premiums can be paid, it will do a lot of good for the financial situation of the program.

Reform of the NHIP can no longer wait. The acting head of the Department of Health Twu Shiing-jer (涂醒哲) has recently invited members of the medical community, medical reform organizations and consumer protection groups to organize a team to monitor the medical community. This demonstrates the bureau's determination to eliminate wrongful medical practices.

It is hoped that through the hard work of government bodies, lawmakers, the medical community and society at large, the NHIP will be able to undergo meaningful reforms.

Those reforms must include more reasonable bonuses and a performance-evaluation mechanism for the bureau's employees, transparency in the price-review mechanism for drug purchases, moves to collect overdue premiums and a better premium-payment system.

This must be done so that the financial condition and the operation of the NHIP will improve, and so that the health of the public will be safeguarded.
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