Public Health Plan

In an interview with Tejarat-Farda, Mr. Seyed Hasan Ghazizadeh, the minister of Health sheds light on the current situation and his plans for the future of healthcare in Iran. He further elaborates on his performance during the past 11 months as the minister and exhausts different aspects of Public Healthcare Plan.



Unlike your predecessors, you have combined knowledge and experience on economic activities and market as well as healthcare and patients' issues given your profession as a physician. Your different viewpoints distinguish you from your predecessors who had turned the Ministry of Health into oil revenue spending machine. In the past few years, despite the suppression of prices and a market that is managed mainly through instructions, both people and economic actors were unhappy with the healthcare system. What are your plans to redress the market?
Unfortunately, in the past 11 months, we have not been able to make a difference. There have been many issues and they still need to be dealt with first. In the meantime, we do not intend to continue in the footsteps of the previous government as it is impossible and the Ministry is gradually surpassing the Ministry of Education in terms of excessive number of personnel to the point where all oil revenue cannot meet the needs of this sector. Healthcare is costly and constantly requires new equipment and services. On the other hand, fresh graduates incur extra costs. The trend cannot continue as it will swallow all government budget in the future. Therefore, we have negotiated with the parliament to envisage stable and fixed credits in the next year budget to finish the plans we have already started. All ministers expect a real, full and timely budget allocations free from assumptions and ambiguities. Regrettably, in the past three years, the Ministry has sustained serious damages given the lack of coordination among the top notch officials. I mean, it was not supported efficiently. The second minister had only six or seven months at hand, so it is evident that the change was done hastily creating further problems, the most important of which was the 7000-billion-toman budget deficit.

Which parts are particularly suffering from the said budget deficit?
Personnel wages and salaries. Fortunately, we succeeded to mobilize 2000 billion tomans at the end of last year 2013. How can we expect the nurses and hospital personnel to be customer-oriented while they are paid in arrear? Nevertheless, based on the agreement concluded with the deans of medical universities, the government has undertaken to pay the arrears by the end of this year. This also covers pharmaceutical companies to whom the government is indebted. It is evident that if the debts are not settled, these companies will not be able to produce and deliver required medicine to the hospitals making them unable to provide timely service to their patients.

It has been decided to allocate some part of revenue generated from subsidy cuts to the Ministry of Health. What will you do with it?
In the past, hospital budgets were given to the universities but now the allocation from subsidy cuts revenue goes directly to the hospitals. In other words, hospital is considered as a small, active economic enterprise. If the cycle works properly, we may be able to release 20% of hospitals from administrative and financial regulations governing public agencies annually and make them independent by establishing board of trustees. The undertaking reduces government involvement in hospital administration. The by-laws of such hospitals allows for independent sale, purchase, investment, employment or dismissal. In brief, we are going to settle our debts with the hospitals by the end of 2014 and in 2015, no hospitals should face deficit. I have assigned independent auditors working directly under my supervision to report on the hospitals' balance sheets on a quarterly basis. Any cases of violations will be punished by immediate replacement of the faulty official. I am hopeful that the decision eliminate budget deficits in the Ministry and subordinate organizations.

Since the start of the new year [March 2014], the new government has launched the Iranian Public Healthcare Plan in order to compensate for the shortcomings in insurance system. This comes amid the huge gap that still exists between the current performance of insurance schemes and the ideal situation. At the moment, expensive medicine and many healthcare services are not covered and people have to pay a larger share while being insured and no effective measures have been designed to deal with it. As the highest authority in healthcare, what is your opinion?
Both as a citizen and official, I have a different viewpoint. I believe people should not worry for treatment costs when they get ill particularly when it comes to refractory and chronic diseases. The government is obliged to support them. It is a national demand and if it has not been met yet, the blame should be put on the whole governance system not only the Ministry as it must be realized through cooperation among the three arms namely judiciary, legislature and executive.
In our neighborhood and also in the world, there are many successful examples where the insurance system provides strong support for the patients in general and those with refractory and chronic diseases, in particular. As reiterated in the past, we are not seeking to extend our authority particularly to the insurance system but to delegate it. However, I believe, as in other parts of the world, the Ministry of Health should closely monitor their performance and act as a policymaker since insurance companies in general tend to be obsessed with the possible risks and costs involved and may exclude new services or medicines that enter the market from their coverage. This is where the Ministry can intervene. I emphasize that the Ministry is not seeking to manage these companies or take their turnover under surveillance. We are selling services and expect insurance companies to operate properly. Currently, the Ministry has to abide by the rates set by the insurance companies for medical services. The rates are not real and that provides room for violations. I admit that the insurance companies are grappling with difficulties as well and eye government support. In the meantime, it is true that the share paid by the insured to the insurance companies is humble in comparison to other parts of the world shrinking the insurance coverage as a natural consequence. But the Ministry expects the insurance companies to set reasonable and real tariffs in return for quality services provided by us and at the same time, take care of people. All these work hand in hand: providing quality medical services and financial support to people and keeping the medical staff satisfied will not be possible if we cannot afford their salaries. During the past 10 months, I have repeated that there is a need for a comprehensive insurance system that covers basic costs in dental care, diagnosis and medical services. Other medical needs such as aesthetic and plastic surgeries could be covered by commercial insurance schemes. The difference between the public and commercial insurance schemes lies in their sources of finance where the former comes from the government. Unfortunately, currently different bodies including the parliament, executive and supervisory organizations have created their own insurance plans while all Iranians are equal and the source of finance for all these private schemes is the same. In other words, when government resources are allocated to insurance system, all Iranians regardless of their place of residence should enjoy the coverage equally.

What is your proposal to redress the situation?
I suggest to aggregate the dispersion of insurance companies in the form of an inclusive and basic insurance scheme covering all the Iranians. In the meantime, the commercial insurance companies can continue to co-exist or new ones can join the system. Unfortunately, some organizations resist the proposal. But who should have the final say? The government and the parliament should one day decide to go with this scenario. This has nothing to do with the amicable interactions among the Ministry of Health, Ministry of Welfare, Ministry of Petroleum, the Army and other entities providing direct or indirect services. I admit that there might be differences of opinion but if we look at this from a national interest angle, all disagreements will disappear. I believe this is quite logical to equally allocate public resources to the Iranian nationals and employ other funds available to various organizations under one insurance umbrella. I can even think as far as aggregating all services under the umbrella of one responsible organization.
Turkey experienced a similar situation. They aggregated all hospitals under the umbrella of Health Organization and did the same for insurance companies putting them under the supervision of Social Security Organization. There is a clearly defined framework for the operation of private hospitals and insurance companies. The tariffs are also logical and updated. The undertaking has encouraged the Turkish private sector to make huge investments in the healthcare area. Such a system has increased public satisfaction while creating a logical relationship between private and public sector healthcare services.

Insurance High Council has approved to increase the tariffs. Has government made any decisions in this respect? How realistic are the approved tariffs?
Based on our calculations, almost the cost of none is equal to their finished costs. In fact, finished costs in many of the services are 7 to 8 times higher than the rate covered by the insurance. Therefore, the hospitals stop offering certain services to the patients as a solution. For example, despite available laboratory, the hospital refrains from conducting a particular test on patients. The same holds true for certain medicine or surgeries. The insurance companies increase the tariffs in proportion to the money they receive from the government. The government has taken some measures to redress the situation which I hope to bear fruit. However, they may only reduce public dissatisfactions but cannot eradicate the main problem. The undertaking requires a well-studied solution which we have already identified namely a unanimous determination on the part of government, parliament and judiciary and any other relevant bodies. National viewpoints should replace sectoral ones. We should not think about our own interest and authority if we want to regulate the healthcare sector.
It seems you have tied your hopes to health care share in revenue generated from subsidy cuts implementation. As government has failed to encourage people to sign out of subsidy cash handouts, history may repeat itself and healthcare may be once again left aside as in the previous government. How certain are you of the payment of the healthcare share? Aren't you expecting larger budget deficit given the launch of new schemes such as free natural delivery and Public Healthcare Plan under which people are required to pay only 10% of healthcare costs?
It depends on how we look at the future. If we look positively, I think there is no room for worries. If negatively, there are concerns about all issues including what you mentioned as our financial resources are unsafe. The only source we can safely rely on is probably the 1% out of VAT. What matters here is the president's decision. On my part, I have raised the concern several times in various meetings. Before the launch of the plan, all relevant officials have expressed their commitment in writing to allocate 100% of the resources envisaged for this purpose. The government has also committed to allocate 80% of the healthcare budget rows even at most turbulent times. The treasury has been required to pay them as well. The commitment is both written and moral. As an official, I am not able to do more. I believe we have done well so far and I hope the trend continues. As to provision of service, there is definitely no going back to one day, one month or one year ago. The public has accepted the government and president's commitment and going against it would create a lot of social problems. Therefore, I rely on the Almighty and the officials' commitment to receive the credits. As to securing financial resources particularly in next year's budget law, we eye the parliament's support.

As I recall as of early 90s, discussions on public healthcare scheme started but nothing happened and only this year the issue has been raised again. This coincides with the implementation of public healthcare plan in the U.S as the American people are not able to afford the high healthcare costs and therefore, insurance is a vital tool. A question that may rise in both countries is whether the scheme is a populist one? In other words, is the new government seeking political satisfaction of people like the previous government or is it, indeed, a technically-examined plan?
I do insist and reiterate that your impression is wrong. There is ample academic work behind the plan and we have done nothing without conducting research first. It is not wise to work without research on issues such as healthcare which is considered the government's Achilles' heel. Hygiene and prevention accounts for the major parts of the plan, the results of which will be seen by the people in due time. The plan has been carefully examined and was taken from the successful model in the world.

What models from which countries?
Turkey is most similar to us and therefore, we have learnt their experience. However, all these measures are like loops in a chain, useless if not connected. The reform is a trend whose benefits is directed at people's pockets. I mean, it is aimed at reducing costs incurred on people and increasing their satisfaction. Justice requires people's increased access to healthcare services. We are still far from the ideal. Many regions in the country suffer from lack of physicians and healthcare facilities. We need to solve these problems. Now I leave this to people's judgment to see if healthcare reform is a populistic plan or not. As you rightly mentioned, the government has not launched any promotional campaigns to highlight it and is following it up in absolute silence. Providing public healthcare is a responsibility on the governance system of the country as rightly envisaged in the Constitution and therefore, the government is required to help all the Iranian nationals live a healthy life. People's easy access to basic medical services at the time of illness has been well echoed in the Supreme Leader's concerns so we consider it a duty to discharge. I believe this is the least we could do for the people. There are also many works left to do to make people happy.
Are you aware of people's satisfaction level? You were quoted as saying 80% of people liked the plan.
I reject having said so. There is a survey center responsible for collecting data and publishing the findings. Besides, academically speaking, no figure can, at this stage, serve as an indicator to evaluate the efficiency of the plan. The first report in this respect is due in 3 months upon the enforcement of the Plan.

Apart from the official research findings, have you received any feedback indicating satisfaction?
Few days ago during a Cabinet meeting, Mr. Janati, minister of Culture announced that the results of a national public survey revealed that Ministry of Health stood second after the Ministry of Foreign Affairs in terms of accountability from people's perspective. Other ministries follow with huge difference. The findings also indicate that people's satisfaction of healthcare services and insurance was 54%, much higher than the figure in previous years. In the past, the number of public complaints stood much higher than the present.

Has the quality of hospital services improved as well?
To tell the truth, except for the personnel no. I mean, the medical society, doctors, nurses, etc. have upgraded the quality of their services as they felt their services are seen by the people and appreciated. My colleagues have been infused with some sort of happiness leading to improvement in their performance.

But it has yet to be institutionalized. Right?
Yes. We cannot expect too much when we have wage arrears. I cannot maintain that healthcare services have improved. The hospitals have been promised to receive their arrears by the end of the year as we have to conduct assessment in parallel to mobilizing financial resources. So far, all our hospitals have been evaluated from different angles for instance their equipment shortages or hoteling services. Some issues identified in the course of assessment were disastrous. For instance, we do not have comprehensive data on the number of personnel in the hospitals. We do not know how many employees each hospital has or in what areas they work. We tried to update the statistics in order to plan correctly. Shortcomings in terms of equipment should be fixed: ambulances and necessary devices and machines should be imported which would take months to complete. Having done so, we can rightly claim that our healthcare services have been upgraded. At the moment, the quality of services are improving but I cannot say it has something to do with our policies. It is mainly indebted to our colleagues' voluntary commitment to improve. Another measure was to increase the number of various specialists serving in night shifts as medical centers were facing serious shortages in this regard. For me, it is a matter of regret to see people from other cities in Tehran camping outside the hospitals to receive medical services in the absence of specialists in their own towns. Certain incentives have been designed to encourage medical specialists to continue to stay in the needy areas; however it is too early to claim that the situation has improved and people are satisfied. I promise to solve all these issues in a systematic manner.
What is your main preoccupation for the time being?
Our debts.

How much is that?
According to the statistics released by the Vice-President for Strategic Planning and Supervision, the Ministry of Health's debts amount to 5500 billion tomans arising from the previous government's policies and measures. We have estimated the amount at 7000 to 8000 billion tomans of which 1700 billion tomans has been settled. Most part of our debts concerns personnel salaries and bonuses which put us under pressure. In the course of transforming the healthcare system, these debts must be settled.
My other preoccupation is the structure. During the term of the new government, we should be able to attract 4000 to 5000 billion toman investment from the private sector. Through the establishment of a holding company, similar to what happened in the Ministry of Power, we would be able to procure equipment, building, medicine, etc. for healthcare. Any external investment can reform the system.

Given the historical distrust of the government intensified during the past few years, do you think you can attract private sector cooperation?
Yes, though it depends on the support of the parliament, government and banking system. The banking system can create such opportunities by the help of Ministry of Finance and the Central Bank. The parliament can be of great assistant by approving relevant regulations. Insurance High Council and tariff-setting by the Board of Ministers are also other important players. I believe healthcare reform should be at the top of agenda for all. It does not fall under the authority of Ministry of Health solely. The Ministry is an executive body. Team work is required and fortunately all parties have already been involved. All three arms, executive, legislature and judiciary have to cooperate to build a unified healthcare system. The collective effort will gradually help an efficient healthcare system established in the country.