Proceedings of the Conference

Khabarovsk - October 1996

October 16, 1996

Deputy Governor Strelkova

Greetings from the Governor. Medical problems have become very critical. Right now we don't discuss if we need or don't need medical insurance. We understand it exist and we have to work in the system that has proved to be effective. We realize how imperfect medical reforms are and how much more there is to do. We wish you success.

The Minister of Health for Russia

Greetings from the Ministry. The reason for our attending this conference is to meet people from the Far East Medical Association. It is the most active Association in Russia. We would like to meet representatives from different Far Eastern Territories and get to know what problems they have.

Regarding money and funding we want to discuss: a) Where to find money, b) How to allocate resources, c) The elements of planned or managed healthcare, and d) Training of personnel and students. World Bank doesn't help those who use modern Russian technologies. The Bank never invest money in territorial projects that are only Russian technologies. We have to finance our medical science and promote and support those based on Russian achievements and innovations.

We need to look for financial resources. Try to earn our own money. The government can not help. There is no money in the country and in the near future the situation will not change for the better.

In your presentations, please, do not simply enumerate problems, but attempt to give us solutions of how to solve the problems.

Anitoli Vyalkov, Minister of Health Khabarovsk Krai

Keynote Presentation

Main trends of medical insurance development in the Far East of Russia.

Problems:

  1. Lack of financial resources.
  2. Expensive medical supplies and drugs.
  3. Limited support from the Government.
  4. Remote territories, with many locate in the North with limited population and thus health care can not support itself.
  5. Population increases have been declining.
  6. Birth rate is declining.
  7. Average life expectancy is now only 57 years for males.
  8. Infectious diseases are on the rise.
  9. Alcoholism, drug addiction, VD and suicide are all increasing.
  10. There is general economic instability.
  11. Infant mortality is increasing.

Legislation:

Decrees and regulations contradict each other. Dumas of different territories don't follow the Federal laws. This leads to chaotic situation in many areas of health care. The old system has been destroyed, but a new one is still a very vague idea.

Financing:

We have a state like system, but without an ability to rely on the government. There is an apparent need to find outside economic/financial sources to improve the existing tangible assets of the health care system.

Medical insurance has proven to be of some help in some territories, but is of absolutely no use in others.

Problems with insurance:

  1. No money from industrial enterprises.
  2. Inadequate payment from both state-owned and private organizations.
  3. Too many hospitals, especially remote areas. No money to support them and they can not function as self supporting institutions.
  4. Only 43% of the money due the fund was collected (assume means in the last year).
  5. Too many undertrained professionals.

Good points with insurance:

  1. Quality expertise is available to the territories.
  2. Financing of big diagnostic centers, providing specialized types of services.

Budgeting:

Budgeting is different in different territories. Some of them use efficiently the money from state budgets, some use the Fund, some use both. Very often the Territorial Administration owe money to the fund and nobody knows when they will pay for the unemployed, retired and children.

Insurance companies provide both compulsory and voluntary insurance coverage. An insured individual does not stand in the center of the insurance companies attention. Either an individual or an insurance company pays for medical services, but nobody guarantees the quality of a service provided. Some people think that the insurance we have is not very good, but nobody has offered something better. We realize it is very difficult to function without money at all. We have to answer some questions:

  1. Who knows how much money we need?
  2. What services can be provided by a medical institution free and what must a patient pay for himself?
  3. What is an acceptable level of health care services to be offered?
  4. What are economic incentives for those who work effectively?

Two years ago a new concept of health care reform was worked out. Many health care

expenditures are not controlled today. If the system does not force individuals to work within available resources the system will never be improved. It is necessary that expenditures be controlled and that available resources be used effectively and efficiently. Seventy per cent (70%) of funding allocated for health care is spent in hospitals, but only 23% of Russian physicians practice in hospitals. Why is so much spent on hospital treatment if our health care plans state that prevention is much less expensive.

Goals and Objectives:

  1. Orientation to outpatient services.
  2. Improvement of emergency medicine.
  3. Improvement of affordability of medical services.
  4. A study of the "black market" for medical services.
  5. Stimulation of internal motivation of physician (not only economic and financial stimulus).

Director of the Federal Compulsory Insurance Fund

There are:

The Funds are trying to register the entire population of the Russian Federation. Very soon new policies will be given. We would like to make them universal to all territories of the Russian Federation.

The Khabarovsk Fund is very, very good. We would like the Khabarovsk Fund to provide special recommendations for the Fund of the Russian Federation on how to organize quality control and external Fund expertise. The legislation has to be improved. We have to combine everything that is valuable and share experience with other territories.

Basic program of Medical Insurance for 1997:

The expenditure of the Fund will be 58 trillion roubles. The Fund will collect 30 trillion roubles. We do not know who will cover the budget deficit.

The Funds have to take Administrations to the courts if they are unwilling to pay for unemployed. Sixty-three (63) territories pay for the unemployed population but there are very many territories that are trying to avoid payment. We can fine Regional and Territorial Administrations. For 1995, the Fund collected one trillion roubles in fines.

Eighty-seven (87) billion roubles came from State resources and bank deposits. Some say the Federal Fund has no right to invest money, make a profit, buy state treasuries and deposit money in bank accounts. But the Fund is losing money if it does invest its funds. Money makes money and we must realize that.

We train specialist who will work at the Funds. There is an educational institution in Saint Petersburg and the Institute for Continuing Education in Moscow. we train as many specialist as need both for the Federal and the Regional Funds.

We are attempting to implement several programs:

  1. Indexation of salaries in health care. 230 billion roubles were allocated from the Federal Fund to support Regional Medical Programs.
  2. Chernobyl medical aspects.
  3. Infant and mother protection. 70 billion roubles to finance the program, 44 billion roubles for the Territories.
  4. War veterans support, disabled, chronically sick patients.
  5. Federal Burn centers. Emergency and catastrophic medicine.

Programs that will be supported by the Federal Government Pharmaceutical Medication Insurance:

  1. State control of the pharmaceutical market.
  2. Pricing control of medication.
  3. Insured pharmacies.
  4. Choice of vendors.

Sick leave:

  1. Too many sick people whose sick leave must be paid.
  2. There are no or little preventive measures to improve the health status of the population.
  3. No need to continue Social Funds and Insurance Funds, but Social Funds have to pay for those who are involved in there sphere of activities.

CIF Director of Primorsky Region (third on program)

Peculiarities of the Region:

  1. Good health care infrastructure.
  2. Overabundance of resources (more than needed).

Legislation has to be changed to give us a chance to improve the health care situation. There are eight (8) affiliates of the Fund. The Fund has been in operation for three years. We can change the structure but do not think it will change the situation for the better.

Thirty (30) regulations and legislative decrees have been approved by our Duma and this helps us to implement Federal Laws.

The Administration of the Territory is the worst debtor. It owes us a lot of money and is unwilling to pay more than 160 billion roubles bad debt for past years and 123 billion roubles contract year debt for the current year. The budget of the territory has been approved by the Duma, but there is no mechanism of how to force Territory and District Administrations to pay for the unemployed and poor.

The Fund doesn't simply collect money, but also provides insurance services. We think it is the best model that has to be preserved in the Russian health care system. A lot of information has been collected by the Funds. We know almost everything about patients treated within the Primorsky Region. The Government has to think of some way to influence the Territorial Administration.

Goals and Objectives

  1. Pharmaceutical insurance.
  2. Working out of new approaches to budgeting.
  3. Cooperation within territories.
  4. Money transfer from one territory to others.

 

Boris Kogurt, Rector of the Far East Medical University

New approaches to training. We have to teach students how to live in a new environment. They will live in the world market economy and have to understand the money and economies are very important issues for physicians as well. The University has set up a department of health care organization and management as faculty for continuing education. We have started to train administration executives and managers, but the participants are people with medical education and even for them it is very difficult to comprehend the basics of economics.

Problems

  1. Absence of teaching basics. No dental clinics. Impossible to drain dentist on a state run basis. We can admit only ten (10) students free. If the situation doesn't change we will be forced to shut down the dental program.
  2. No teaching pharmacies. We train pharmacist who have no idea what a modern pharmacy, as a drug store is. They are trained as old fashioned pharmacist who know only how to dispense drugs and label them.
  3. Many hospitals and clinics don't want to provide space for university class rooms. Many head physicians are unwilling to have university departments in their buildings. Medical schools need their own clinical base.
  4. There are too many medical schools in the Russian Federation. The Government is planning to decrease the number of physicians. Why then do we admit and train so many physicians?
  5. The Far East Medical Association has to become more responsible for specialist training. It has to evaluate physicians and identify those with professional which are inadequate and need to be improved.
  6. The Far East Medical Association has to be interested not only in specialty training, but also student training.

 

Yu. Miklailova

Two years ago we discussed the insurance system problems. The Far East Medical Association has worked so much and so well that we are going to ask the Far East Medical Association to provide recommendations on quality control and quality expertise for the entire Russian Federation. We have to discuss the basic trends that need government support:

  1. 1. Hospital Services to out-patient services:
  1. 3. Not quality control, but quality expertise. Penalty is not necessarily the best way to stimulate.
  2. 4. Hospital beds reduction should be based on existing statistics and not on someone's whim.
  3. 5. Medical Insurance Funds structure try to change the system of health care financing. It transfers from state budgets to mixed (private and public) budgets, but the amount of free and paid services have to be negotiated by taking into consideration the ability of the patients to pay.
  4. 6. The must needs to move its focus from treatment to prevention.
  5. 7. There is a need to use modern statistical analysis and approaches consistent with world accepted methods.
  6. 8. There is a need to move from patients without rights to educated patients who know what their rights are.
  7. 9. Federal Medical Monitoring:

 

Pomauof Romanov, The head physician of the Sakhalin Regional Hospital

The Fund helps:

  1. Payment for utilities.
  2. Payment for pharmaceuticals.
  3. Salaries.

The Fund provides 21% of all the necessary finances. The administration of the Territory owes the Fund a considerable amount of money. Local district administration do not pay for the unemployed, pensioners, children, etc. We tried to take administrations to court, but lost the majority of cases. We expect that the Federal Government and the Fund will help to resolve the above mentioned problems.

Pustovay, Health Minister for the City of Khabarovsk

  1. Restructuring of medical institutions.
  2. Reduction of hospital beds.
  3. Economic independence of medical institutions.

Problems

  1. Volume has become the key issue. Bad!!! Thirty to forty per cent (30% to 40%) of hospitalized patients do not need hospitalization. This leads to financial losses. Many hospitals have turned into nursing homes.
  2. Beds in hospitals belonging to other industries - military, railroad, etc. are not occupied.
  3. Too much money spent on hospital services, thus inadequate money allocated to clinics and preventive institutions.

Measures

Improve quality control. Make external quality expertise more active.

  1. Cut down unnecessary expenses.
  2. Set "real" prices for different types of services.
  3. 1,084 people laid off.
  4. Use day care instead of hospitalization. Expand outpatient services and add new types of outpatient services.
  5. The budget deficit for health care in 1996 is 44% of expenses.
  6. Group purchase of supplies and equipment.
  7. Increase the use of "money saving" technologies.

Gvarliana, T.Y., Methodological Foundation of Medical Insurance in the Russian Far East

  1. People. No properly trained specialist in economics and insurance. Only four (4) people in the Russian Federation are Ph. D> in the economic science specializing in insurance.
  2. Markets. Different types of ownership. Only under this condition will a market for medical services be developed in the Russian Federation.
  3. Technologies.
    1. 1995:
      • 22 trillion roubles collected by the Funds and insurance companies.
      • 30% of premiums compulsory.
      • 10% of premiums voluntary.
      • 40% of premiums mixed.

      572 insurance companies provide 40% of insurance.

Negative Tendencies

  1. Territorial Funds and their affiliates must not be turned into insurance companies.
  2. No control of money allocated within an institution.
  3. Insurance business needs to be licensed.

Funds need to be renamed so as not to be confused with insurance companies. There are differences between a Fund and an insurance company. Functions of each are to be determined.

Tikhomirov, A. F., Jewish Autonomous Republics; Medical Insurance in Rural Areas of the Region

The Fund is the monopoly in our Territory. It collects money and provides medical insurance. Our Territory is rural and subsidized by the state finances.

Problems

  1. Eighty (80) hospital beds for 10,000 people. Many GP's and no specialist. There is little prospect for future development of the hospitals.
  2. Low accessibility to diagnostic services because of remoteness and bad communication.

Payment

  1. Per procedure (clinic) volume.
  2. Per patient (hospital).
  3. Per unit (dental).

Average hospital stay is over 21 days. There are too many patients with advanced stages of sever chronic diseases. For the last two years: 15% of beds reduced, 86% of hospitals turned into day care or clinics.

There were several lay-offs. 5% of employees were laid off. Some of these lay-offs were due to individuals not receiving certification of specialty or licenses. The Territorial Licensing Committee was of great help.

Other Issues

  1. Rural affiliates have to work through commercial banks. sometimes it takes several months to receive money from the banks. All of them are in debt and they use health care money or payments from the Fund to cover their debts or losses.
  2. Eighty-three per cent (83%) of the money due was paid by the administration.
  3. Head physicians have no financial experience. They want to solve all their problems as soon as there is money in the bank account. we have to teach them how to choose priorities.
  4. If an enterprise goes bankrupt we must break contracts, but in the current economic situation it will lead to the fact that 85% of the rural population will not be covered and will not have access to medical services.

Kutuev, Kh. A., The Head of the Territorial Military Hospital

Military hospitals provide services to:

  1. Regular army.
  2. Ex-military and their families.
  3. War veterans.

Goals

  1. Protection of military health. Generals and other officials think that health issues are the problem of military physicians.
  2. Reorganization of existing hospitals.
  3. Implementations of new standards.
  4. Improvement of specialized services.
  5. Restructuring of territorial and regional (military?) hospitals.

Problems

  1. Too many hospital beds are empty.
  2. In many hospitals there are no gynecological and pediatric services.
  3. In 1992 70% of patients were regular army. In 1996 only 45% were regular army. This change may simulate restructuring of many hospitals.

Emergency

  1. There are special teams working with Territorial Centers of Emergency Medicine.
  2. Close collaboration with the specialized department (of emergency medicine?) at the Far Eastern Medical Center.

Fifty to sixty per cent (50% to 60%) of reserved ex-military have a right to free medical care. They however, usually go to a regular clinic or hospital and very often have to pay for their examination and treatment. There is no contractual agreement with Fund and the Far East Military headquarters.

Strodubtsev, Deputy Minister of Health of the Russian Federation

The Federal guarantees are too generous. The state budget can not cover the guarantees.

What has to be done?

  1. Plan certain type of guaranteed services.
  2. Reasonable centralization.
  3. Changes in legislation are needed.
  4. Reduce the number of guarantees.
  5. Restructure the health care institutions. 150,000 beds have been reduced in the last five (5) years. There is a need to move from hospitals to outpatient services and to train physicians to facilitate these changes.
  6. Patient's rights need to be protected.
  7. The Funds will become executive institutions and they will become insurance companies. Funds have the right to employ insurance company agents within the approved budget to provide compulsory and voluntary insurance. We assume there will be a very strong resistance from the "real" insurance companies because the Funds, as insurance companies, will attract customers from the "real" insurance companies.