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Photo: Juan Diego Cano - Presidencia Colombia

Colombia’s health system could finally see changes that put people over profit

The bill proposed by the government would create a National Health System based on a social insurance model, financed by parafiscal contributions from social security contributions and the nation's own resources, which would go into a single public fund. (Photo: Juan Diego Cano - Presidencia Colombia)

The health reform proposal of the Petro government has sparked a heated debate, as the health insurance corporations and conservatives try to block it.

Article first appeared on the People's Dispatch

by Mauricio Torres-Tovar

The arrival of the government of Gustavo Petro and Francia Márquez brought the new possibility of reforming agriculture, energy, labor, pensions and health, among others. The government has now taken up the social demands and aspirations of the historically excluded sectors of the Colombian population.

This has led to the reopening of a debate on the reorganization of the health system, especially after the government recently filed a bill based on the demands of years-long mobilizations: the elimination of the intermediation exercised by private insurers (EPS); the establishment of a health care model grounded in the territories, based on Primary Health Care (PHC); decent and dignified work for health workers, and a health information system with public access that promotes different forms of participation and social control.

The EPS was introduced at the beginning of the 1990s, when Colombia adopted the neoliberal guidelines promoted by the World Bank to reform its health system. The reform brought market dynamics into health services and has thus reduced the accessibility of health care for many people in Colombia.

The bill proposed by the government would represent a break from this status quo. It would create a National Health System based on a social insurance model, financed by parafiscal contributions from social security contributions and the nation’s own resources, which would go into a single public fund. The government’s proposal also suggests changes in several aspects of the health system, the most relevant of which have to do with the issue of who manages the system’s financial resources, and the system’s governance.

In the public debate spurred by the proposal, conservative political parties and their representatives in the Congress, together with the associations of private health insurers, have maintained that to do away with the EPS would be to do away with the health system. They have presented alternative bills that support intervention of the private sector in health.

The central dispute: who manages the health system’s financial resources?

An overall agreement exists on the need to change the health care model so that it focuses more on promotion of health and prevention, is re-organized on a territorial basis, improves the working conditions of health professionals, and sets up a single public information system. But there is no agreement on the introduction of a single health fund and its decentralization by regions. Such a model would allow for direct payments between health service providers, both public and private, eliminating the need for the EPS.

This is the central issue of the dispute, as it would have a strong impact on the insurance business. This business is a product of the financial intermediation work of the EPS, which allows them to receive an annual payment for each insured person, whether or not they are treated. It also allows the insurance companies to impose their rates on the health service provider institutions and define the conditions on which they reimburse the cost of care, or choose not to reimburse at all. Such a practice has led health providers to accumulate a debt as high as USD 5 billion and, through cost containment, has also led to the precarization of health workers.

At the end of March 2023, the government presented a report in the House of Representatives and in the National Congress. The results of the report support the initiative of the government and propose a transition to a new health system. This implies a change in the character of the EPS and the introduction of direct public management of health resources.

EPS limits access to health services

It does not come as a surprise that traditional political parties and the health insurance guilds are opposed to this proposal, seeing that they are the ones that designed Colombia’s current health system. While under the EPS regime insurance coverage has increased to 97% of the population, in practice, being affiliated with an EPS doesn’t guarantee access to health services. The EPS model generates barriers to access to services as a result of its cost-benefit logic. The practice has led to a unquantifiable list of court orders to the EPS to demand that they guarantee the set of health services they are responsible for and which they deny or limit, directly or indirectly.

When it comes to financial protection, it must be noted that out-of-pocket expenses continue to be a significant burden due to co-payments and full payments. To this, one must add the corruption which is widespread in the EPS model, and which represents an additional barrier in the achievement of a functional health system. While the health budget in Colombia has reached a little over 7 percent of the GDP, under the current model those resources have been used mainly for hospital care, and very little for promotional, preventive, and public health actions.

For example, in several regions of the country deadly but preventable health problems persist such as maternal and infant morbidity, malaria, dengue, and tuberculosis, among others.

Health systems which are more efficient and effective in improving the health of people have a public base, are publicly funded and operated by public providers, which promote PHC. It is in this direction that the government wishes to move. Traditional parties and health insurance businessmen have used all kinds of resources to discredit and prevent this change.

Right now, we are facing the possibility of a scenario of fundamental change promoted by a government elected on a progressive, people-oriented platform. It remains to be seen whether the progressive forces will emerge triumphant from this contest, depending on their capacity to mobilize large masses to demand and press for change.

Mauricio Torres-Tovar is a physician and Associate Professor at the School of Medicine, National University of Colombia. He is an activist in the People’s Health Movement.