Andria Urushadze: Redistribution of responsibility between the public and the state


Reform of the Georgian health care system is now in progress. The public is especially interested in those steps taken by the state which affect the hospital sector, pharmaceutical market and health insurance. Andria Urushadze, the Minister of Labor, Health and Social Affairs of Georgia, speaks about those and other important issues in his interview with Tabula magazine.

What challenges does the Georgian health care system face today?

Health care reform is underway, successfully though not without difficulties. One main direction of the government’s ten-point action plan is to ensure affordable quality medical services. That is the key orienting point of health care reform as well. Many citizens are still unhappy about the quality and mistakes of our system. Therefore, yet another orienting point of our reform is the advocacy for citizens’ interests, the protection of rights and interests of insured citizens.

Our strategic objective is to increase efficiency of public health care. Public health care includes a number of services and interventions. I am talking about financing those citizens whose health endangers others. Today, state programs envisage funding of services related to treatment of citizens suffering from tuberculosis, AIDS or mental disorders. In addition, there are screening programs also funded from the budget. Moreover, public health care implies health promotion, control of hospital infections, treatment of cardiovascular diseases and diabetes mellitus.

Public health services are available for free for any citizen today.

Why do you think that the state must take care of the health of the public rather than people themselves?

When a citizen has an infectious disease that endangers others, it is in the public interest to eliminate any financial barrier to accessing medical services. When discussing diseases that relate to an unhealthy way of life, it is necessary to talk about personal responsibility. However, citizens must have motivation and sufficient knowledge to protect their health. Public health services are not only free, but even, in some cases, enable families to cut their spending – for example, spending on tobacco. It is therefore natural that we advocate for and promote a healthy mode of living.

How is the process of hospital privatization going?

Quality health care requires that new hospitals be built and equipped in accordance with modern standards and staffed with qualified personnel. A 2007 investment project, envisaging the construction of a hundred new hospitals, was impeded by many factors. One of them was the August war in 2008. Russian aggression delivered a hard blow to our economy. The global economic crisis added to that. Nonetheless, the construction did not stop even in the hardest years. Within the next six months, we plan to complete construction and rehabilitation of one-hundred-forty-nine hospitals. People in the regions and the cities see that many buildings are actually ready while others are in their final phase of completion. We will deliver on our promise by all means and each district and city will have a new, rehabilitated, up-to-modern-standards hospital. This will significantly improve geographic availability of health care services for citizens.

Is liberalization of the service sphere still one aim of the health care policy?

The word “liberalization” is somewhat ambiguous – one of our principles is to facilitate cooperation and free competition between private and state sectors. This means that the state refuses to be involved in the routine administration and management of hospitals. The state encourages private initiative in the health care sector. This has already produced good results. It is necessary to talk about quality control, protection of interests and rights of citizens at medical institutions, to respond to the main question on how to make and maintain this service affordable for people.

Criticism that concerns this area is about the possible rise in prices.

Prices for medical services are not low today either. Moreover, the service costs were increased with additional costs – hundreds of our citizens had no other choice but to travel to larger cities for medical service. The response to this issue has been an increased number of insured people. Four years ago, only forty-thousand people had medical insurance; today, that number reaches a million-and–a-half. A new initiative of the President of Georgia envisages insuring every aged pensioner and every child of pre-school age, beginning on 1 September 2012. This means that nearly every other citizen who had a problem of affordability, or who was not insured because of age or dependency on parents, will become a holder of state-funded insurance.

Can you name those facilities which the state does not plan to sell? Why should, say, an AIDS center be an exception and not be run by a private owner?

Time will come, and we will decide together on how better to manage those facilities which now remain in the hands of the state.

There is no evidence that the state is the best manager of a hospital. I am sure that quality supervision and management efficiency will be better achieved if a hospital is run by a group specialized in hospital management. This is not a sale, but rather the attraction of funds and additional investments. Rights and responsibilities are set out in a contract. One of the conditions is the preservation of services that are important for the public. An issue on the agenda was that, in the event of a sale, some of the districts could have been left without, for example, vaccination. Maintaining the most important services for society is compulsory in new facilities. 

Privatization will increase the quality of medical service as well…

We will conduct quality control separately. Our main interest is to make service a high-quality commodity and, therefore, impose supervision over it. This approach proceeds from license conditions and interests of our citizens.

You mentioned insurance. The state strategy aims at ensuring state insurance for 2.5-million citizens by 2015. On what calculations is this plan based?

Now we have 1.5-million insured people. Next year we plan to increase this number with 250,000 pre-school children and 600,000 aged pensioners. Bearing in mind that private insurance is developing at a fast pace, we can say that this number is pretty accurate. Insurance is the best way of decreasing the cost of medical services.

However, there exists a private sector in which a citizen can buy insurance without state interference.

There are groups of citizens who encountered various barriers in purchasing insurance – financial or age barriers. Poor citizens faced huge financial problems in buying medical services they badly needed. Moreover, insurance companies, as a rule, do not insure aged people. With regard to insurance for children, the country has its own objectives and one of them is to decrease the child-mortality rate by improving affordability of medical services. This is a response to demographic challenges.

We have chosen an approach where state medical insurance can be purchased from private health insurance companies. These companies are obliged to act in accordance with those rules of game which have been set by the state – a fixed price, delivery of information, geographic availability, et cetera.

At the same time, we must promote private insurance. We encourage people to choose for themselves whether or not to buy health insurance. This is a redistribution of responsibility between the public and the state.

Let us talk about the reform of the pharmaceutical sphere as well: deregulation of the pharmaceutical market has brought about positive results – increase in competition, emergence of new drugstores, decrease in medication prices. What will happen with current regulations? Do the reforms imply further regulatory simplification?

Work in this direction continues. Proper legislative initiatives have been supported. We established a recognition regime on medicines registered in the United States, European Union, Japan – that is, in highly regulated countries. When importing medicine registered in these countries to Georgia, we do not have to conduct additional clinical or any other examination because the registered medication has already been examined once. This move has increased the quality and reliability of medication. A parallel import regime encouraged free competition and the pharmaceutical market has been liberated from grips. Free competition and the emergence of new players have caused the cost of pharmaceuticals to decrease by twenty-three percent.

A strategy document says that, in order to meet the needs of the country, new inflows of doctors must be checked and an adequate balance in medical personnel must be achieved. How are you going to achieve that? Why do you think that the state can determine better than the employment market how many medical professionals are needed?

Planning of human resources is an instrument to find out what problems exist in the delivery of medical services. The number of registered doctors today well exceeds the demand for them. On the other hand, there is a shortage of nurses. Moreover, the majority of doctors are registered in Tbilisi and other big cities; one can hardly find a qualified doctor in rural areas.

Another difficulty is that eighty percent of doctors are practicing within narrow specializations. We must support professional retraining programs, decrease barriers which prevent doctors from changing their qualification and from finding a job. An important thing is to properly organize qualification exams. Upon obtaining a diploma, a doctor is not allowed to start work instantly; he/she must first pass qualification exams. Unfortunately, only thirty percent of the seventeen-hundred graduates with medical diplomas managed to clear that barrier this year. This means that there are serious problems with medical education in general and with the qualification of personnel. Obviously, in such a case, our response should be the training of doctors and nurses, supporting them in accessing modern literature and professional development.

What is the situation with medical services in the penitentiary system? The Ombudsman’s official report for the year 2010 says that the involvement of the Ministry of Labor, Health and Social Affairs in health care reform in the penitentiary system is minimal and unclear. What is the current state of affairs? Have you taken into account the recommendation of the Ombudsman?

We have created a coordination group which includes representatives of both the Ombudsman and Minister of Corrections and Legal Assistance Khatuna Kalmakhelidze. We work in coordination in order to bring the quality of medical services in prisons in line with the quality of services outside prison. Practical steps have also been taken. For example, a new hospital of modern standards is being built in the Ksani prison which will accommodate prisoners suffering from tuberculosis. The health of each citizen – whether with restricted certain rights or not - is equally important for us.

Tabula has reported on plans to reform the psychiatric sphere which envisaged rehabilitation centers for patients with mental disorders, development of outpatient treatment and the upgrade of medical personnel. What is the status of that reform?

The reform envisages the upgrade of hospitals, setting up departments in general hospitals for acute cases and separate departments for children and chronic patients. All these initiatives have already been completed in Tbilisi, Rustavi, Batumi and Kutaisi. Infrastructural changes will be carried on. We support programs for social rehabilitation of patients with mental disorders. Progress has been observed in the retraining of personnel as well. Textbooks are being translated. A large library with literature on psychiatry is expected to open at Ilia State University.

Tabula readers would also like to know about the progress of reforms in the child-care system. What is the situation in terms of abolishing large institutional facilities and transferring abandoned children from state care to smaller family-type facilities? Is the entire abolition of large-scale child institutions planned?

These institutions will be replaced by family-type facilities, foster care and other types of services. For the past five years, the number of children in large facilities has decreased by seventy-five percent. Seventeen family-type facilities are already up and running. An additional fourteen facilities will be completed by February 2012. The first one will be inaugurated soon in Gldani.

We hope that a significant number of children will be returned to their biological families. We also plan to launch a project concerning street children and citizens ages eighteen and above who were raised in shelters.

The Labor Code of Georgia is acknowledged as one of the best – for example, according to the Ease of Doing Business rating. Nevertheless, trade unions criticize the Labor Code for being discriminatory and demand that it be changed. What is your stance on that? Are employee interests protected in Georgia today or not?

We have created an institution of social dialogue which involves the trade union, the Employers’ Association which I chair, and the Ministry.

It is important that any change is based on consensus between an employer and an employee. We can thus avoid not only unprofessional debates concerning labor legislation, but also serious problems which may cause social or political tensions. Many whom I have met who criticize the Code have not even read it.

The main advantage of our Labor Code is that it imposes minimal restrictions on the labor relationship. It grants both employee and employer the freedom to enter into a mutually acceptable employment contract through negotiation. This freedom is not only for an employer, but for the employee too. Recent developments in some European countries, including economic crises and instabilities, have to some extent been caused by rigid labor regulation or social liabilities.

The ideology of the Georgian government is sympathetic with libertarianism. How can a proper balance be struck between compassion and libertarianism? This issue is most relevant to those spheres which fall within the scope of your Ministry – health care, social safety, labor.

The government has its role and a responsibility to the public. In the health care sector, the supervision and establishment of certain standards and the protection of citizens when their interests are infringed are necessary conditions. At the same time, any administration or sphere needs to have proper orienting points, strategic objectives. It is necessary for society to have a common vision on how to make our health care system more affordable and of better quality. In this I do not see any conflict with any ideology. The path which the Georgian government offers to the public is the most effective at this stage and allows for the achievement of key objective in the short term: economic development; decrease in unemployment; social equality; better access to medical and social spheres. This is what the society is expecting from the government it hired.

Regarding the balance, I think it is struck – however, it is up to voters to decide.




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