Oleksiy Gavva,
Chief Doctor of Zolochiv CRH, Kharkiv oblast
The autonomous healthcare institutions and the experience
related to implementation of contractual arrangements.
The Zolochiv region of Kharkiv oblast is a typical agricultural
area with the population of 32,432. Before the commencement of the reform the
network of medical treatment – prevention facilities comprised the Zolochiv CRH
(180 beds), 10 family doctor ambulatories and 23 feldsher/obstetrician
facilities. The CRH, as a budget entity, was financed from the region’s budget,
whereas the family doctor ambulatories were funded from the budgets of local
self-government bodies. It should be noted that at that period 100% of the
region’s population were services by the general practice doctors – family
medicine doctors.
In practice the activities aimed to reform the healthcare
management and financing system were commenced a year ago – specifically, in
September 2004. In order to implement a new model for local healthcare system
management and financing the region’s Rada passed a decision on 19 October 2004
to subordinate the Zolochiv central region hospital to Zolochiv region state
administration, with the region’s Rada remaining the owner of this facility.
During October – November 2004 the territorial communities (Zolochiv township
and village Radas) addressed the issue of transferring their healthcare
facilities into joint ownership of the territorial communities of Zolochiv
region and passed relevant decisions.
The region state administration was also assigned the function of
managing the property of medical ambulatories and feldsher – obstetritian
facilities, which belonged to the rural communities on the basis of the
communal ownership right. All the funds for healthcare for 2005 were
consolidated in the region’s budget without allocation to local Radas. An
algorithm for financing healthcare institutions had been formulated and then
introduced on 1 January 2005.
The session of the Zolochiv region Rada of 1 December 2004 passed
a decision to set up, on the basis of the budget entity Zolochiv central
regional hospital, 10 family doctor ambulatories and 23 feldsher/obstetrician
facilities, a communal enterprise „Zolochiv central region hospital”, which is
a legal successor of the aforementioned budget entity.
To manage healthcare facilities and to introduce contractual
arrangements in their activities on 1 January 2005 the healthcare department
(with the staff of five) was set up at the Zolochiv region state
administration. This department is a principal healthcare funds
manager/administrator and procures medical services for the budget money for
the region’s population (in line with the Law of Ukraine „On government
procurement of goods and services for public money”). This Law is aimed at
creating competitive environment in the area of government procurement,
ensuring transparency of goods and services procurement procedures and
achieving their optimal and rational use. The healthcare department of the
Zolochiv region state administration and the communal enterprise „Zolochiv
central region hospital” signed an agreement (contract) for provision of
medical services to the population of Zolochiv region in 2005, by virtue of
which contractual arrangements were introduced in the healthcare sector. Under
this agreement the Zolochiv region state administration , through its
healthcare department, acts as a Customer of medical services for the region’s
population, whereas the communal enterprise „Zolochiv CRH” – as provider
(supplier) of these services. It should be noted that the CE „ Zolochiv CRH” is
allowed to sign agreements on provision of medical services with other
customers as well, whereas the Zolochiv state region administration may find
other providers for supplying medical assistance to the region’s population.
On the basis of the primary medical-sanitary assistance center
there may be created in the region another autonomous provider – the communal
enterprise „Zolochiv primary medical assistance center”. To create this center
as of 01.01.2006 a relevant decision was passed by the Zolochiv region Rada.
Another provider may also be created on the basis of the dental department.
Since 1 January 2005 CE „Zolochiv CRH” has been operating under the agreement
(contract) for provision of medical services, which was signed on the global
budget basis. This kind of the agreement is the most simple and easy to
implement and can be recommended as a first step toward introduction of
contractual arrangements in the healthcare sector. The agreement clearly
specifies rights and responsibilities of both Customer and Provider. The
agreement provides for the transfer of financial resources from the region’s
budget for 2005 in the total amount of 3,862,000 hryvnas to ensure conditions
needed for Provider to organize medical services for the population, with
allocation of specific amounts for in-patient, outpatient – polyclinic and
ambulance medical assistance.
It was anticipated that in case of the increase in the total
budget funding the total amount of financing also may be increased. That was
already done in the current year, and adjustments to the value of the contract
will be made due to the anticipated wage increases. The agreement provides that
wages for the personnel may not be lower than respective wages of employees of
budget healthcare facilities. It should be noted that such a clause is also
included in the collective agreement between the administration and the trade
union committee of the CE „Zolochiv CRH”.
The contract provides that the Provider may at one’s own
discretion reorganize, re-allocate and re-designate the hospital beds and
personnel in line with the volume of services provided. The Provider is allowed
to use additional sources of financing (including sources such as solidarity –
based funding, charity contributions, humanitarian assistance, etc.) in a way
consistent with existing legislation.
The Provider’s task is to supply the specified volume of medical
services and to step up the efficiency of the use of available resources. The
efficiency criterion specified in the contract is the average in-patient
treatment length at the end of this contract (this length was to be reduced
down to 11.6, but it is already 10.3 today). Other criteria include number of
hospitalization cases per 10,000 population (1,283), number of daytime
in-patient hospital treatment cases (616), number of ambulatory surgical
operations (740.1), number of ambulance calls, and some other criteria.
The Customer makes monthly payments to the Provider for work
performed in accordance with the approved financial plan. During the period of
the contract there have been no failed payments so far. The Provider monthly
reports to the Customer on the volume of services supplied and the money spent.
What are the outcomes of the autonomy of the CE „Zolochiv CRH”,
which has not been long in existence yet?
-
The available funds began to be used more to finance inexpensive and effective
kinds of healthcare, such as out-patent/polyclinic-based assistance. In 2005,
40 in-patient hospital beds were eliminated, and a daytime in-patient facility
for 20 beds was established at the CRH.
-
Due to more efficient use of funding there were performed a series of repair
projects, telephones were provided for family doctor districts, medical
equipment purchased, etc. Re-allocation of funds is by far faster and easier
than in budget agencies.
-
It became possible to reorganize the network of the healthcare facilities
according to the volume of services supplied under the contract. The priority
direction of this reorganization is to shift major volumes of medical
assistance for the population towards the family districts and to strengthen
these districts, to improve their logistical base.
-
Greater autonomy creates better opportunities for introduction of new forms of
work compensation. Now we are planning to introduce the capitation payment
method in primary medical assistance centers. The problem is that districts in
both cities and villages are not homogeneous due to different numbers of
feldsher/obstetrician facilities. It is necessary to develop an algorithms
which would take into account the money needed to support such facilities
within the family medicine districts.
We are prepared to ensure all necessary conditions for creation of
private family medicine districts, which will lead to the increase in the
number of medical service providers in the region.
Assessing our modest experience in increasing the autonomy, I have
to admit that communal enterprises have indisputable advantages over budget
entities due to the greater level of autonomy in setting the organizational
structure, personnel structure, and introduction of advanced forms of work
compensation.
Now there are greater opportunities for planning and flexibly
reallocating expenditures to meet the needs. There have emerged new
opportunities for obtaining additional funds through contracts with new
Customers.
However, autonomous enterprises, provided that this system is
widely used, are not entitled anymore to the guaranteed funding and will have
to think of the «portfolio» of contracts for their services under conditions of
a competitive environment. Our communal enterprise was created in conditions of
the existing legislative framework, which is far from perfect. Not all the
issues that arise in connection with the taxation of this enterprise have been
resolved, and this work is still underway. Although the global budget is the
simplest form of contracting and is the ideal solution for the first stage, it
is necessary to develop more complex forms of contracting, which would reflect
both volumes and costs of medical services. Introduction of such agreements
requires a sufficient level of IT development at the enterprise. Owing to the
support provided under the EU project „Health management and financing in
Ukraine” throughout 2005, there have been computerized the bookkeeping
department at the CE „Zolochiv CRH”, the information/analysis department of the
region healthcare department and the primary medical and sanitary assistance
center, which enable use to look at signing more complex forms of contracts in
the future with optimism.
|