How health care system works


 

Health Care Reform: an Opportunity for Insurance Industry Participation in Sierra Leone's Medical Care System

The socialized system of healthcare deliverysocialized medical care system, the costs of
and financing, a relic of the Britishwhich have been borne exclusively by the
colonial era, still practiced in Sierra Leonegovernment will now be based on a multi-payer
has glaringly failed and any efforts atsystem in which government, employees and
resuscitating it without implementation ofemployers  will  all  participate.
major structural and systemic reform will
only  serve  to  prolong  the  inevitable.With the system as currently structured
however, only the government has a financial
Throughout the world, total state control andinterest and stake and when other programs
management of industries, services, marketsconflict with the financing of health care,
and the means of production are graduallypoliticians have only been too willing to
becoming a relic of the past. This model assacrifice the health of their citizens on he
practiced in the Sierra Leone healthcarealter of their greed and personal
system has empirically been proven to haveaggrandizement.
served only to stifle innovation, growth,
productivity and quality output with aIt is envisaged that health insurance
resultant decline in overall living andproviders will introduce concepts and plans,
healthcare standards of the citizenry. Thesuch as Health Maintenance Organizations
current state of the hospitals and health(HMO) and Preferred Provider Organizations
centers glaringly highlights the systemic(PPO), through alliances of health providers
problems endemic in the entire governmentand insurance companies and marketed to
owned, managed, financed and operated healthemployers, labor unions, governmental
care  system.ministries and corporations on an annual
premium  basis.
The continued operation of such a decadent
and dilapidated delivery and financingThe competition engendered by such health
system, lacking in even the basics of aorganizations for the medical insurance pie
modern healthcare infrastructure continueswill subsequently result in competitive
relegating Sierra Leone to the very bottom ofrates, coverage, deductibles, co-payments and
the  human  development  index.premiums to make health care costs affordable
for  all.
The transformation thus of the medical
healthcare delivery and financing systemÂThe  Unemployed:
into a private insurance or a national
insurance based system offers opportunitiesAs unemployment and underemployment are
not only for insurers to develop market-basedperennial problems in the Sierra Leonean
medical insurance plans and policies but alsoeconomy, the provision of health care
serves to effectuate the Ministry of Health &benefits to this category of the population
Sanitation's desired policy goals, asmust remain the responsibility of government.
espoused in the 2002 National Health PolicyMedical services provided to this category of
Paper.citizens in a private enterprise environment
must be reimbursed by the government on a
Both policy and regulatory officials,negotiated and pre-determined fee schedule or
healthcare providers, the insurance industryan insurance mechanism established in which
and other stakeholders must be engaged togovernment negotiates with providers and
effectuate implementation of fundamentalcarriers  for  the  provision  of  services.
systemic reforms if the country is to avert
an  even  greater  catastrophe.As an example a fund established by levying
taxes on the private health care providers,
Privatization:envisaged to emerge with such privatization,
could be instituted and utilized to pay for
Âthese  indigent  services.
Under the proposed privatization plan, theFurther, since the hospitals, medical clinics
Ministry of Health & Sanitation will beand other medical facilities will be operated
transformed from ownership and management ofas businesses, either for profit or as
hospitals, clinics, and employer of lastnon-profit organizations, the market forces
resort for all physicians, nurses andof demand and supply will certainly ensure
ancillary healthcare providers into a healththat patient quality care, improvements in
agency with only policy and regulatorydiagnostic technologies, competent personnel
functions.and a general responsiveness to the demands
of the clients will drive the new
The goal will be for the health agency tomarketplace. The lethargic and inefficient
serve as a policy and regulatory watch dogatmosphere witnessed at most government
mandated with ensuring that adequate andhospitals today with customer service
quality medical care is provided at thevirtually non existent would be a philosophy
various private hospitals, clinics andof  the  past.
pharmacies that will inevitably be
established with the break-up of the currentThe economic viability of healthcare
government  owned  facilities.businesses will depend largely on the
clientele they can attract and maintain
With the break-up and subsequent purchase orutilizing the above yardstick. Providers of
leases of these hospitals, clinics, healthlousy health care plans and services will
centers and other facilities, investors andinevitably loose business to competitors as
entrepreneurs in an effort to realize maximumevery year participants will have an
returns on investments, will economically beopportunity to change health insurance plans.
compelled to upgrade quality and standard of
care, introduce state of the art equipmentSince a large population of Sierra Leone
and technologies and engender a type ofresides in rural areas, the proposed
market forces competition which will inureprivatization plan will ensure the expansion
only to the betterment of health consumers inof health care facilities into areas
the  country.currently inadequately serviced. This plan
will ensure that clinics and doctors put up
A much needed infusion of capital into theshop in every part of the country in order to
health care industry by such a privatizationtap into the healthcare services available in
plan will clearly spur additional economicthese  rural  areas.
activities in ancillary industries, as the
dynamic forces of privatization and marketChallenges  to  Insurance  Companies:
mechanism forces of demand and supply will
ensure  competition  for  the healthcare pie.Designing an insurance system and plan to
cater to the needs of the rural population
Divestiture  of  Government  Ownership:who often are self employed in farming and
mining activities posses a challenge to
The dismantling of the current mammoth andinsurers in Sierra Leone, who in the past
highly inefficient government ownedhave been largely passive and unimaginative
healthcare delivery and financing entity mustin policy design to meet the challenges and
from a public policy perspective be designedrisks confronting the nation's socio-economic
and restructured to ensure governmentallandscape.
ownership and management divestiture from
hospitals  and  other health care facilities.Proactive and creative underwriting of risks
must be undertaking by underwriters,
Under such a scenario the government'sactuaries and marketing specialists to
current enormous but woefully mismanageddesign, tailor and price health insurance
capital outlay for health services will becoverage to meet the diverse needs of the
substantially decreased as inefficiencies ofinsuring public. For example, the creation of
corruption, salaries of providers,pools by occupational categories could be one
infrastructure maintenance, costs ofmethod by which insured's, engaged in similar
medications and diagnostic equipments andtrades could be encouraged to form
other overhead operating costs will no longerco-operatives for purposes of obtaining
be recurrent expenditures from the nation'shealth insurance coverage at affordable rates
depleting  coffers.for themselves and dependants. Premium
payments through the pooling together of the
A system based entirely on a privateco-operatives commodities can be an
market-based national health insurance planalternative payment method for the medical
with private enterprise and marketservices. Health insurance companies could
competition at its core appears the mostpossibly establish subsidiary or ancillary
logical reform policy route to ensure acompanies solely for the handling of payments
future sound, efficient and profitable healthmade  by  cash  crops.
care  infrastructure.
The current system under which nearly all
  Health  Insurance  Plans:doctors and related health care providers are
employed by the government while at the same
The cog which the proposed new system musttime owning private practices would be
revolve around is a nationwide network ofchanged with a concomitant government savings
affordable health insurance plans creativelyon salaries, productivity and other fringe
designed to ensure a greater poolbenefits. As privatization takes over in the
participation of a majority of thehospitals, physicians, nurses and other
population. In such a system health insuranceproviders will no longer be on the
companies and provider organizations will begovernment's payroll but will rather be
established to market various health plans,independent contractors with their own
with minimum services and premiums based onpractices.
market conditions. The responsibility for
monitoring compliance by the various plansConclusion:
would fall under the ambit of both the
Ministry of Health and Sanitation and theWhilst a micro version of the proposed reform
Sierra  Leone  Insurance  Commission.has mushroomed in an ad hoc manner over the
years with some large companies and
Multi-Payer  System:corporations contracting with individual
physicians and clinics for the provision of
A major plank in this proposed health carehealth care to their employees and
delivery and financing privatization hingesdependants, the kind of systemic and
on the enactment of health insurancestructural overhaul needed to forestall a
legislation providing for employers tototal collapse of the system and extend
provide health care for their employees andsimilar services to all could only be
dependants as part of a standard benefitsrealized by a comprehensive approach along
package with concomitant tax incentives andlines of reforms proposed in this policy
governmental subsidies to ensure compliance.paper.
With such legislation the virtual free



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