National Consultation on Public Health Sector

Role of Private Healthcare in the Health Sector Reform

Public Healthcare and Tertiary Medicine
Ceiling to “Free” Public Healthcare – Budgeting / Human Resource Limitations
Development of Private Healthcare in Trinidad & Tobago
Benefits of Private Healthcare to the Public Healthcare System
Dangers of Duplication in Private and Public Healthcare
Parallel Development of Private and Public Healthcare sectors
Strategies to allow for Parallel development
Summary

In looking at the Way Forward for Public Health sector reform, undoubtedly the question of how the public healthcare system can be stretched to keep pace with the advances in medicine must arise. The current administration to their credit have begun to explore this question very early in their term and have commendably begun looking at ways to provide better access to high tech secondary and tertiary medical care services to our population. The truth is, however, that this a topic that baffles even the best funded socialized public medical system in the first world and countries such as Australia, Canada and the UK struggle to stretch their already large healthcare budget to keep pace with many advances in medicine.

Realistically, we in Trinidad & Tobago are a long way away from having the foundation of solid public primary and secondary healthcare which these much larger countries already have in place. Therefore the question of how to provide advanced healthcare in our public healthcare system must always be viewed in the context of the limited healthcare budget being split to provide development in all levels of medical care from prevention to cure. This makes the goal of providing tertiary healthcare even more difficult if not impossible. This is not to say however that methods of getting closer to this goal should not be formulated and this is the subject of my contribution.

I begin by suggesting that public healthcare like all other social systems must be ideally built from foundation up. That is beginning with a focus on primary and secondary healthcare – i.e. continuing the development of disease prevention through education, vaccination, environmental management along with family medicine and basic specialist care and surgeries. Public healthcare dollars will have the biggest impact to the largest number of people by continuing to build a strong primary and secondary healthcare system.

The second point is that there is a definite limit in terms of the level of advanced healthcare which can be provided free of charge to all sectors of the population. This limit is set in part by the finite healthcare budget, the amount of money required for the provision and development of the basic healthcare system and the limitation of highly trained and high cost human resources required to provide this level of healthcare.

With these undeniable limitations, the question is then how does a developing public healthcare system such as ours get closer to the goal of providing better access to the more advanced levels of healthcare.

One possible answer which has been contemplated in the past is to go to a fee for service system in the public healthcare system for more advanced healthcare, however I do not believe this to be the most effective or cost effective way forward. It adds complications to the administration of public medicine and distracts from the focus of the public institutions.

Another idea is that of national health insurance which conceptually is a good solution but practically is quite complicated to develop and administer. It therefore will take some time to implement.

An easier solution I believe lies in encouraging greater cooperation between the private and public healthcare sectors and in defining a role for private healthcare in Public Healthcare Reform.

Private Medicine has made great strides over the last fifteen years with the establishment of several small private hospitals catering to the cash paying population. Since it can be said that the impetus for the development of these private hospitals was the perceived shortfall of the public healthcare system in providing the higher levels of medicine then it is not surprising that these hospitals focused on the more advanced areas of specialist medicine. The result has been a vibrant private healthcare sector which offers a broad spectrum of healthcare services several of which are not provided anywhere else in the English speaking Caribbean.

This development in private medicine a number of favorable offshoots for the public healthcare system which should not be overlooked.

Specifically, a strong private healthcare system has resulted in the following:

A lessening of the burden on the public healthcare system.
Another source of income to attract top medical specialists to return to Trinidad & Tobago and make it feasible for them to make their contributions to both the private and public sectors.
The provision of a wider spectrum of healthcare services to the population of Trinidad & Tobago.
The establishment of Trinidad & Tobago as a centre for healthcare in the Caribbean beginning to rival the services provided by Puerto Rico and the USA.
Employment and training of numerous nationals in the healthcare field.

It is important therefore not to view the private and public healthcare systems as two mutually independent entities. There are in fact very much intertwined and given the benefits outlined above it is our opinion that it is in the Government’s interest to foster the continuing development of the private healthcare sector through both tax incentives and through the development of policies which allow for cooperative initiatives between the private and public healthcare systems to the mutual benefit of all involved.

In particular we suggest that given the already established institutional and human resource capabilities in several areas of tertiary medicine in the private sector then it would seem reasonable for the Public healthcare system to outsource these specialist services in the private sector rather than duplicate the same in the public institutions.

Duplication of these services would have the following deleterious offshoots:

Public funds are wasted in purchasing high-cost assets which already exist in the country and are already underutilized
Recurrent costs of operating a tertiary healthcare service puts a tremendous burden on the public healthcare budget and makes the ongoing operation very difficult to sustain and also effects the ability of the public system to provide the more basic levels of medicine
Government competes with private healthcare which does not encourage further investment or development of private healthcare with the lost of the aforementioned benefits.
Time and human resources are wasted in the development of a specialized program which already exists in the country and takes away from the focus of building a strong primary and secondary healthcare system.

A policy of parallel development of the private and public healthcare sectors is in my opinion THE WAY FORWARD for our overall healthcare system.

Some suggestions for policies to encourage private health sector reform includes the following:

We propose that Government continue to build upon the existing incentive policies for the development of private healthcare projects. Specifically the existing “ Policy for the Granting of Fiscal (Tax) Incentives for the Private Health Sector” should be both expanded and further advertised to encourage participation.

Value Added Tax and import duties should be removed from all inputs to all medical institutions so as to reduce the operating cost to the private health sector. It has long been puzzling that Medical Services are VAT free yet private medical institutions pay VAT on input supplies with no mechanism of recovering the same except for passing on the cost of the VAT to the patient. This in effect defeats the concept of VAT free medical services. This matter needs to be reviewed so as to be consistent.

Government should institute a policy of tax benefits to companies for providing health insurance to its employees. Again this would take the burden off of the public healthcare system and would stimulate the continued development of the private healthcare sector.

It is also our considered opinion that Government should seek to outsource its tertiary healthcare requirements in the private healthcare sector rather than attempt to duplicate these services in the public healthcare sector as mentioned above.

In this way, Government can achieve its goals of broader access to tertiary healthcare to the broader population in a sustainable and cost effective manner. Costs can be greatly minimized to the public patient through a combination of required discounts to access aforementioned government incentives as well as competitive forces in the private sector who must now compete for publicly funded or referred patients.

In this way Government can focus its resources on the provision of the basic healthcare needs while at the same time providing easier access to tertiary levels of healthcare to the broader population and stimulate the continued development of private health care. The result is a win-win scenario where everyone benefits and particularly the patient accessing healthcare locally.

We thank you for this opportunity to present our thoughts on the way forward for our public healthcare system and commend the government in providing this forum and on their openness of thought in dealing with the development of our national healthcare system.

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