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Wednesday, 20 April 2011

PF Manifesto on Health Services

By Chola Mukanga

The current challenges in health services are humongous. I was recently at Ndola Central Hospital and saw many horror stories – an entire city hospital for example with only one dialysis machine. HIV patients are kept with people suffering from severe skin diseases. Patients sleep on the floor. Stories abound of people jumping from the sixth floor to commit suicide because of poor conditions. The stench alone is enough to consign an alien visitor to mental asylum.  That is in the province that is the "home of copper"! Now, what about rural hospitals? Then there’s the never ending corruption and procurement scandals. It is no surprise that the sector continues to experience a massive "brain drain". The challenges facing any new government appear insurmountable. But these challenges is also what the PF proposals in this area interesting. Health should be the PF’s strongest suit because the party President Mr Michael Sata is famed for the many positive changes he introduced while he was Minister.

What are the main specific policy proposals?

PF policy proposals for health services are set out under seven main areas:

Health Services Financing. PF pledges to double current budgetary allocation in order to provide universal care. User fees will be abolished and health care will be “based on need” rather than the “ability to pay”.

Health Provisions: There would massive increase in staffing levels ; more medical equipment and ICUs. Rather than fly patients abroad, it proposes to develop “a system of inviting specialists from abroad”.

Human Resource: PF plans to improve conditions of service to minimise the "brain drain". It also plans to “rehabilitate and expand existing health training institutions so as to increase the number of graduates”.

Medicines and Technology: There’s a commitment to “rationalize the Procurement and Supply chain for medicines..to eliminate abuse and promote transparency”. A new medical equipment policy is also promised.

Health Information System: The main proposal is the ambitious, but necessary, plan to establish a “computerized National Health Data Base, capturing the whole population”.

Organisation and Leadership: The proposals are very general, they include a commitment to repeal the National Health Services Act and a review of engagement with donors.

What is the rationale?

The PF believes that health provision in Zambia suffers from three problems.

Underfunding : PF believes that under the MMD government the budget for health services has been very low. This has resulted in poor and insufficient provision, manifested in an “inadequate, overworked, poorly remunerated and demotivated human resource; a massive brain drain; frequent shortages of essential medicines…[and] dilapidated health infrastructure.”

Unequal provision:  The ,anifesto notes that under the MMD government service delivery has been characterized by poor and insufficient provision of health care, particularly for the poor. By proposing to switch from a "willingness to pay" approach to a “needs based approach” PF are signalling that good health is a universal right.

Institutional and informational problems : According to the manifesto, the current health service is saddled with, “…gross irregularities; discriminatory financing mechanisms of the health sector; manual and outdated health information system; and an organizational structure ill fitted to deal with the critical and worsening health challenge..” Simply put the system is not fit for the 21st century because it is inefficient and does not know its user population. There are huge structural information gaps.

What is our main assessment?

There’s a lot to be admired in this section of the manifesto, in particular the commitment to increase budgetary commitment. PF explicitly commits 15% of the national budget to health and this would allow people to hold them to account. The proposal for a national health database is also exciting because one cannot deliver health services without information. The current systems is neanderthal. 

Though these commitments are welcome they are not cheap.  It is therefore noteworthy that PF does not appear to be suggesting that the funding will come from a reduction in corruption and other inefficiencies. It is also clear that donors are unlikely to contribute more money to the health sector given the history of corruption that has characterised the last two decades. This will therefore require new money from ordinary Zambians. Voters may therefore ask how much burden they may be asked to bear in form of taxes, but more importantly whether such proposals are credible given other competing priorities.

In some ways, the funding challenges highlight a general problem with PF proposals. There appears a strong need for PF proposals to move from mere problem diagnosis to clear innovative solutions. Take the issue of the brain drain.  The PF rightly recognises that the brain drain is a problem, but it sees higher wages as the solution! Can government really compete against other developing countries in attracting our workers? Similarly, PF has correctly identified the rampant practice of government funded shipment of politicians abroad for treatment. The PF solution is to get those experts abroad to come to Zambia because it is cheaper. How does PF know that? In both cases, it seems there’s need for engaging the diaspora to help fill some gaps on either voluntary basis or cheaper compensated pay, without requiring them to return. This is just one example of innovative and cheaper solutions that should be explored. If there’s one disappointing aspect of the proposals is that there’s little innovation.

That is not to say the proposals are unworkable. There are some pretty good ideas and the diagnosis is spot on. The big uncertainty for voters is the deliverability of the solutions given their huge financial implications. For that we must work through the rest of the manifesto to see where financial savings are proposed or indeed how they plan to raise revenue.

Related Posts :

MMD Manifesto : Health Services

Chola Mukanga is an economist and founder of the Zambian Economist which provides independent economic perspectives on Zambia's progress towards meaningful development for her people


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17 comments:

  1. " Unequal provision: The Manifesto notes that under the MMD government service delivery has been characterized by poor and insufficient provision of health care, particularly for the poor. By proposing to switch from a willingness to pay approach to “needs based approach” PF are signalling that good health is a universal right.

    But though these commitments are welcome they are not cheap. It is therefore noteworthy that PF does not appear to be suggesting that the funding will come from reduction in corruption and inefficiencies. It is also clear that donors are unlikely to contribute more money to the health sector given the history of corruption that has characterised the last two decades. This will therefore require new money from ordinary Zambians. Voters may therefore ask how much burden they may be asked to bear in form of taxes, but more importantly whether such proposals are credible given other competing priorities.


    It also implies an increase in taxation. Especially on mining. :)

    This is what is needed though - a return to universal healthcare and education.

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  2. Yes. Mining taxation can potential fill the gap. BUT there's nothing in the manifesto that indicates PF plans to increase mining taxation. I will come to mining in due course.

    ReplyDelete
  3. Yes. Mining taxation can potential fill the gap. BUT there's nothing in the manifesto that indicates PF plans to increase mining taxation. I will come to mining in due course.

    But the implication is that if the PF is held to account for the promises made in it's manifesto, it will have to deal with the windfall tax and mining tax collection in general.

    I agree that this is not explicity dealt with in the manifesto (the word windfall or windfall tax doesn't occur once).

    However, high ranking individual members of the PF have talked about the need for the windfall tax.

    Lubinda accuses MMD of complicity with mines
    By Kabanda Chulu in Kitwe
    Wed 19 May 2010, 04:01 CAT


    I quote:

    “It will come to pass and no industry in Australia will close down as a result of the 40 per cent mining tax and we shall wait to see if those industrialists will come to Zambia because President Banda, Mwale, Musokotwane and their government removed the windfall tax and introduced profit variable tax which is difficult to collect and this is why they have failed to project revenue figures,” said Lubinda.

    I guess it is a game of connecting the dots. :)

    It would be a very easy argument to make to the PF, that if they are going to fulfill their manifesto, there is no way around collecting taxes from the mining industry.

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  4. There is need to get rid of unecessary cost centres in the public bureaucracy. For example; monies for social spending and infrastructure development could be found by reducing on the number of Ministries. Why for God's sake do we have the Ministry of Livestock and Fisheries alongside the Ministry of Agriculture? Why cant Energy and Tourism be mere departments within the Commerce portfolio. What exactly is the point for the so called District Commissioners when we have local councils? Let us also get rid of all Deputy Ministerial positions. These people dont even stand in for their Ministers. What is their point exactly other than as cost centres and products of political patronage? For Zambia to improve on her human development condition we need to get rid of waste in form of the many patronage political and bureaucratic positions. These positions just divert resources from areas that could make a difference in the lives of the vast majority of Zambians.

    ReplyDelete
  5. Cho,

    Yes. Mining taxation can potential fill the gap. BUT there's nothing in the manifesto that indicates PF plans to increase mining taxation. I will come to mining in due course.

    It is well known that several high ranking PF members are in favour of a windfall tax, and have criticized the MMD over not collecting taxes from the mines. Google:

    Lubinda accuses MMD of complicity with mines
    By Kabanda Chulu in Kitwe
    Wed 19 May 2010, 04:01 CAT

    Frank,

    You are very right. There are A LOT of savings to be had by streamlining government. Why are there more than 12 ministries? Also, proper oversight in procurement could save hundreds of millions of dollars.

    ReplyDelete
  6. MrK,

    I see your point. I would agree that there's greater chance of PF imposing a new fiscal regime than under MMD. Without reviewing that section of the manifesto immediately, I would have liked to see a framework for how they might proceed e.g. commitment to put a framework that is fully consulted on via a White Paper for example. Anyway, I'll deal with that in due course.

    Frank,

    Its funny you should mention the two ministries in agriculture because the manifesto does not suggest they will be abolished. It says it will see how they operate. Will post something on agriculture tomorrow.

    ReplyDelete
  7. the idea that universal accessibility to health can be obtained only by making health care free to all is not true. they are a lot of income earners in zambia that can afford health care at a fee. there is no need for gov to burden the entire population to pay medical bills for people that can afford. for example people with a an income should be encouraged by some way to put money aside for the possible future medical expenses. this means people will look for money before they are sick unlike the current system. gov can simply persuade all employers to give medical cover to its employees which can be administered by someone else other than gov agents.i thought PF will come up with such radical ideas which have the potential to put zambia at the level of S.A.
    increasing payment to doctors in order to stop brain drain is not that simple. as we know zambia is not that rich and the tax burden on the business community or population would be unacceptable.therefore alternative funding must be found

    ReplyDelete
  8. Anonymous,

    You are just defending the mines not paying taxes.

    Most people cannot afford healthcare, whether they are in official employment or not. The fact that some could afford to pay their own way is no reason that "therefore alternative funding must be found".

    ReplyDelete
  9. I agree with Cho, Mr K , and others about the primary cause of the sad state of our health system. The lack of adequate funding is the biggest part of the problem. Without a proper, sustainable funding model very little will be achieved.( I am not discounting the eradication of corruption,lack of political will etc that will be also be required to turn things around) To carry out the commitments spelt out in the Manifesto, will require funding that is substantially more than can be mobilized from current taxes. It would be nice to collect more taxes- Windfall could be a start!. However even these extras may prove inadequate to get us to the level suggested by the PF.( My reading is that PF does not endorse universal access)

    My Disappointment at some of the comments is that some are suggesting universal access. Universal access is a noble aspiration. But even with windfall taxes that is a bridge too far. Mr K even suggests that it is ridiculous for anyone to pay irrespective of their income status!. I would think that all revenue streams should be welcomed and not shunned.
    Zambia is not unique in discussing the funding model for its health sector. The resolution of funding for the health system care in The USA is key to solving their trillion dollar deficit .
    We need to put in more money into health . Our Health system can get better, but let us not over-reach and over promise.

    ReplyDelete
  10. Kaiba,

    Some good points there.

    On reflection you are right to suggest a needs based approach does not necessarily translate in universal access. However I think PF's starting point is that health is a universal right. If so, the only way such a right can be defended is through universal access.

    ReplyDelete
  11. Kaiba,

    Mr K even suggests that it is ridiculous for anyone to pay irrespective of their income status!. I would think that all revenue streams should be welcomed and not shunned.

    Zambia is not unique in discussing the funding model for its health sector. The resolution of funding for the health system care in The USA is key to solving their trillion dollar deficit .


    I think there are very few people who could afford $50,000 or more for hart surgery.

    However, if all people pay a small nominal annual fee for universal access, through universal health insurance, the risk can be spread over the entire population.

    Also, the requirement for healthcare provision cannot be separated from the general health of the population and issues like access to clean water, ample food, public utilities, pushing back malaria, etc. Also public safety issues like flooding add to people showing up in emergency rooms or needing hospital care.

    However access to healthcare should be without charge and therefore accessible for everyone.

    ReplyDelete
  12. Kaiba,

    The resolution of funding for the health system care in The USA is key to solving their trillion dollar deficit .

    I didn't catch this the first time, but the US's problem is that it has been following the same neoliberal economics that the IMF has been forcing on the Zambian people.

    Their problem is that they massively reduced the tax rate of the top income earners, and corporations, which is why they don't take in enough tax revenue.

    There are corporations in the US that make billions of dollars in profits, but pay no taxes. Some even get a tax rebate from the government.

    Sound familiar? :)

    Check out this article and video on how General Electric pays no taxes in the USA.

    ReplyDelete
  13. Mr K
    I agree with your diagnosis of the problem. I also agree with your notion that universal medical insurance should be paid.

    ‘However, if all people pay a small nominal annual fee for universal access, through universal health insurance, the risk can be spread over the entire population’

    Where I disagree is that the amount should be small and should be nominal. We know that nothing in this world is ever free. Someone somewhere eventually has to pay. And to get a sustainable system running that will not run out of money, adequate premiums will have to be charged. Nominal payment equals nominal care in the long run.
    I think we need to throw money, people, resources, the kitchen sink – kaufela , everything ! at the problem. And even then, it will be at least five years before the health system can be in a state we can start to begin to rely on. I would think it will be another 10 years before our politicians will be comfortable enough to stop their trek to Morningside. But a start should be made now.
    I do not think that we need to re-invent the wheel. Let us take a look at South Africa’s Model. (I use SA because our GRZ subsidised politicians and elite in Zambia are flocking there. Surely SA must be doing something right). SA has essentially a two tier system. On one hand, there are numerous government hospitals that are available to anyone at virtually no cost. On the other hand there are the private hospitals, (Netcare and Medi-clinic hospitals being the two biggest hospital chains). These Hospitals cost quite a lot. Morningside is a Medi-Clinic Hospital by the way. These are open to all who can afford. As MrK rightly says, no working person in Zambia can afford $50,000.00 for a heart operation. I would dare say that no working person anywhere in the world can afford that! But elsewhere in the world ,heart operations are being carried out daily on working people. How is it done in SA, UK, USA, Japan, France, Singapore etc? The answer is indeed medical insurance! And in all these places you pay monthly and the amounts are not small!
    Shelter, food, education etc are rights that all humans should have. Recognition of a right does not necessarily mean you have to meet all of the costs for providing that right! The role of government in my view should be limited to ensuring that there is a safety net. For those that are struggling or simply do not want to pay for health care the government option should be made available. But for those that can afford and are willing- give them the chance and opportunity to pay for better quality hospitals. The government is thus spared that expense and can use those extra Kwachas to serve the poor better

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  14. the answer to strenghtening our health care requires that we open the avennue of medical insurance/aid schemes.this is sustainable especially is private players participate both from the financiers and health worker.

    ReplyDelete
  15. Kaiba,

    Where I disagree is that the amount should be small and should be nominal. We know that nothing in this world is ever free. Someone somewhere eventually has to pay.

    And money eventually can be raised from many sources - VAT, property taxes, etc.

    What is important to ensure universal access, is that there is no charge at the point of admission. Healthcare should not be contingent to the ability to pay, at least for non-elective surgeries, dental care, health checkups, etc.

    It is far more expensive to have people go without healthcare and let society carry the burden of ill health and early death, than it is to ensure everyone has healthcare.

    ReplyDelete
  16. MrK

    We are actually on the same side of the issue- up to a point. My point of departure is that when you crunch the numbers and look at what requires to be spent, to get us to a functional position, you will realise that huge sums are needed. You and I both agree that there are no free items in this world. I think that to use tax revenue to pay for specific individual health needs on a day to day basis is inefficient. The tax revenues can be used by the state to provide for items you alluded to earlier ie public health. The government has a big role to play. But that role is to provide the framework , scaffolding and regulation around which the medical industry can develop and thrive.
    I agree that it is far more expensive to let people go without health care. Medical insurance is also in a way a tax,( in essence a super-tax) but its advantage is that it is automatically specific, targeted, ringfenced and can provide that direct feedback loop that balances level of consumption, price and production. Health care is a scarce resources and yes I believe the basic laws of economics apply to this sphere as well

    And on the GE issue I am 100% in agreement with you about the need to limit tax loopholes. For me General Electric just brings into sharp focus how big a task it will be to rein in these tax dodging Mining companies. For the record -I think we need to collect more tax from these transfer pricing con-specialists but not necessarily by means of a new withholding tax!.

    Anonymous

    'the answer to strenghtening our health care requires that we open the avennue of medical insurance/aid schemes.this is sustainable especially is private players participate both from the financiers and health worker'

    I could not say it better myself- our financial markets are shallow and narrow. In one move we will be taking a giant step towards developing our health system but also deepening and broadening our Financial markets.

    ReplyDelete
  17. seening that no political party for now in proposing introduction of medical aid/schemes/insurance. i just wanted to know what practical difficulties are prevent us as zambia from implementing this, considering the benefit that come with it.

    ReplyDelete

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