Updated 11 months, 1 week ago

Latam's changes in health care model and Zika

ZIKA, a mosquito-borne virus, is the kind of epidemic that Latin America hoped it had put behind it. Yet in the past nine months Zika has spread to 23 countries in the Americas, infecting some 3m-4m people. The disease, which probably causes babies of infected mothers to be born with small brains, will put primary health providers and hospitals in the region under strain. Yet thanks to a complex but hugely positive transition towards universal health care, they are increasingly capable of coping with it.

Historically, health systems in Latin America have been marked by fragmentation and gross unfairness. The rich have private health insurance and patronise private hospitals, some world-class and others merely overpriced. Workers with formal jobs are enrolled in contributory social-security systems. Unusually, these do not just provide health insurance but also run hospitals. As for the poor, who tend to work in the uninsured informal sector, they have had to rely on the patchy services provided by health ministries, often having to pay for drugs and even for syringes and sheets. Serious illness often bankrupted poor families.

Over the past 30 years this picture has begun to change. Under democracy, many countries have written a right to health care into their constitutions. Latin Americans are living longer and are more in need of treatment for ailments such as cancer and diabetes that were once more prevalent in rich countries. In response, governments are stumbling towards universal health systems. There is no single route to that destination. But most have expanded both the coverage and quality of health care for poorer citizens. On many measures they are succeeding.

One model is that of a tax-financed system with government as sole payer (as in Britain’s National Health Service). That applies, of course, to the famed health service in communist Cuba, as well as in Costa Rica. It also applies in Brazil, where the 1988 constitution set up the Sistema Único de Saúde, merging the health schemes of the Social Security Institute and the health ministry. It has delivered improvements. The problem has been how to finance and staff it in a country where nearly everyone turns to public hospitals for treatment after retirement, even though 25% of the population has private insurance.

Other countries, including Mexico and Peru, have bolted on a subsidised insurance system for the poor. Colombia has taken insurance-based reform further, though not without problems. A new constitution in 1991 proclaimed universal care; a law separated purchasers from providers. The expectation was that two-thirds of the population would be covered by an expanded contributory scheme, says Alejandro Gaviria, the health minister. In practice, half are in a government insurance system in which they pay little or nothing. That encourages workers to remain in the informal economy.

The Constitutional Court ruled in 2008 that the benefit plans offered by each system have to be the same, even though the government scheme has less money. Drug companies got the courts to mandate prescription of expensive pills. Mr Gaviria, an economist, arrived in 2012 to find that many health-management companies, which rely in part on reimbursement from local governments in their role as insurers, were bankrupt.

He has adjusted judicial aspiration to financial reality. He has set up an equivalent of Britain’s National Institute for Health and Care Excellence to decide which drugs offer value for money. He is defining benefit plans more tightly, requiring more payments by patients who can afford them. He accepts there are still “a lot of inequities”, but argues that a poorer Colombian who lives in a big city gets better health care than her peer anywhere else in Latin America.

Many health experts think the single-payer system is fairer and more cost-effective. But such radical reform faces resistance from vested interests. So it may be easier to merge contributory and non-contributory schemes into a single system, as France and Colombia have done.

According to Daniel Cotlear, a health specialist at the World Bank, Latin America offers lessons in its acknowledgment that the poor cannot pay for health care, in improvements such as benefits packages covering specified treatments, even if these entail “implicit rationing”, and in making public providers more efficient by giving managers more autonomy. With the economic slowdown putting pressure on budgets, he urges governments to continue to give priority to enrolling the poor in health schemes and to small-town clinics. To that list must be added caring for victims of those insidious mosquitoes.

The Economist |