Citation
Accessibility to primary medical care in Chile

Material Information

Title:
Accessibility to primary medical care in Chile
Creator:
Scarpaci, Joseph L., 1955-
Publication Date:
Language:
English
Physical Description:
vi, 6 245 leaves : ill. ; 28 cm.

Subjects

Subjects / Keywords:
Cities ( jstor )
Economic inflation ( jstor )
Geography ( jstor )
Health care costs ( jstor )
Health care industry ( jstor )
Health care services ( jstor )
Health policy ( jstor )
Hospitals ( jstor )
Patient care ( jstor )
Physicians ( jstor )
Medical care -- Chile ( lcsh )
Public health -- Chile ( lcsh )

Notes

Thesis:
Thesis (Ph. D.)--University of Florida, 1985.
Bibliography:
Includes bibliographical references (leaves 217-237).
General Note:
Typescript.
General Note:
Vita.
Statement of Responsibility:
by Joseph L. Scarpaci, Jr.

Record Information

Source Institution:
University of Florida
Holding Location:
University of Florida
Rights Management:
Copyright [name of dissertation author]. Permission granted to the University of Florida to digitize, archive and distribute this item for non-profit research and educational purposes. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder.
Resource Identifier:
000585652 ( ALEPH )
ADB4291 ( NOTIS )
14258109 ( OCLC )
Classification:
LD1780 1985 .S286 ( lcc )

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ACCESSIBILITY TO


P1IN 18 RA


MEDICAL CARE


IN CHILE


JOSEPH L.


SCARP ACI,


A DISSERTATION PRESENTED 0TO THE GRADUATE SCHOOL
OF THE UNIVERSITY OF FLOBIDA II
PARTIAL POFULPILLHENT OF THE REQUIREBENTS
FOR THE DEGREE OF DOCICE OF PHILOSOPHY































Copyright


JOSEPH


1985


SCABPACI,














DEDICAiICN


To my


sister


Josette


Marie ,


through


example


taught


brothers and sister to


help


less fortunate.


father


Joseph,


who showed me at


very


young


many


worlds of geography.















ACKBOWLEDGBCBETS


I have benefited from


working


with sany


scholars


during


doctoral program.


Among


geographers stand


chairman,


Cesar


Caviedes,


refined my


interest


the Southern Cone


perspective on


and his confidence


through his


writings and


social problems


ability


been


to carry


field


lectures.


a great


this


asset


research


was


unswerving.


Stephen


Golant


was


helpful


throughout


graduate work and Dr.


Stewart


Fctheringham


provided


assistance with


the use of


spatial statistics.


Non-geographers


also generously


supported


research.


have been particularly


fortunate to work


with


Crandall


who was


always available for thoughtful


discussion.


Seminars


aided


taught

with a


Drs.


nalytical


Charles R.

tools in


Wood and


carrying


Terry

out d


HcCoy


emograFhic


and


health care


Economi


st Dr..


delivery


Douglas


research


Bradham,


La ti n


although


America.


a cosaittee


member,


read and commented


on Chapter III.


must also


thank


late Dean


Ruth


RcCuown


approving


preliminary


research


funding


for


fieldwork


in Chile


SUmn Qer


1981.









Transportation funds


Mere


provided by


Arturo


Valenzuela


Duke


University


for


attending an eight


ueek seminar


Santiago,


held at FLACSO and


Institute


International


Studies


of the


University of Chile,


June


Julj


1983.


Reviewers from


journals


Social


Science and Medicine


Great


Britain


and Inforaaciones


Geoqraficas


University


of Chile


offered


bei~ful


substantive


comBeDts


manuscripts that are


press at


those


journals and


form


part


of Chapters


II and


V respectively.


Aaong


the many


Chileans


supported ay


months


field and library


research in


Santiago


thank


especially


physician Dr.


Juan Giaconi


the Centro Diagnosticc


Catholic University


Department of


of Ch


Planning,


ile, Us.

Ministry o


Marianela

f Health,


Iglesias


eccncaist


Ernesto Miranda


National


Health


Funad.


profited


greatly


from discussions


uith


economists


Iuis


Biveros


Tarcisio Castaneda


the University


of Chile


and Jorge


Rodriguez of


CIEPLAN


BLADES.


was very


Sociologist


helpful in


Dagmar


design


Baczynski


questionnaire


and indicating


related


resea rch.


very special


thanks is


extended


Villa O*Higgins clinic,


staff and


ntonio Infante

patients who


shared so much


Only


with me and to whoa


course,


as much


am responsible for


debt.


the contents















Abstract of


Dissertation Presented


University


of Florida in


Requirements for the


ACCESSIBILITY


Degree


TO PRIMARY


Graduate


School


Partial Fulfillment of


Doctor of


MEDICAL CARE


Philosophy



IN CHILE


JOSEPH L.


SCABPACI,


August


1985


Chairman:


Major


Cesar


Department:


Caviedes
Geography


Traditional health policy


neoclassical


Chile


development model


has changed


current


under


regime.


Social services have


been reduced


legal frameucrk


has been


restructured


to facilitate more


private


medical


care.


This


study analyzes


effect


these


policy


changes on


spatial


economic,


cultural


medical care


and organizational,


accessibility.


Policy


outcomes


have


produced


more


out-of-pocket


payments,


care and


increased


the cost of


nanthly


Public


wage


medical


uithholdings for


vouchers issued


health


.JV *


aspects of









from


National


reviewed from


Health Service


1962


1983


System


cne


(S. N. S. S. )


indicator


are


these


policies.


Medical consumers'


purchasing


power


fell


percent between


failure of


1978 and


medical


1983.


practices


Possible


(I SA P~s)


reasons


capture


originally predicted


market


share are


discussed.


Demographic


utilization and


and


organizational


satisfaction


with care


acdels


among


examined


a survey


S. U. S. S.


users


in southeastern


Santiago.


Users


were


satisfied


with


medical care


despite


long


waiting


periods


conflict


with


ancillary


workers.


Survey


findings suggest


that


S. N. S. S.


users expect a


miniaua


level


medical


care.


Comparison


with national and


the importance of


physicians'


international


bedside


studies


manner and


reveals


proximity


to medical care.


The


spatial


org anization


Crimary


medical


care


analyzed


Greater


Santiago and this


pattern


compared


with


those from Canada and the


lapped accessibility


surfaces


to S.N.S.S.


clinics


(for


medically


indigent)


reveal


under-serviced


areas


low-income


newly


settled


municipalities in the south.


spatially more concentrated


1980


Private


than


physicians


1950,


were


suggesting


that


private medical market


in Chile,


like Canada,


not acting


as an agent of dispersion.
















TABLE OP CONTENTS


EAGE


SDIOC a IC N


AC NC f 0BL ED GIBE nT S


ABSTRACT


* a a a a a a S 5 a 5 S C a 2V


S. a a e a a a e a a. a a e e V.i


CHAPTER


Background .
Scope and Eurpose .
Conceptual and Empirical
Accessibility .


Components of
* a a a a a a a a 12


BESTRUCTURING


HEALTH CARE


FINANCING IN


CHILE


production 0 .. .
blic and Private Per
Financing .
blic Health Policy i
anges in Health Care
1980s .
Transfer of Clinics


*


Health


n Chile: 1918-1979
Financing in Chile


- *r
Prom


national


1 S .
Care


. 21
* 0 26


* .a a
County


. 31


L
New Fee
A
Pension
The Produc
Expanding
Prepaid
Adainistra
Deli
Evaluat


level .
Schedules and


gency
Fund
tion
Bole
Grou
tire
terat
ion u


S* S
encies
Health
Private
tactic
ora an


.ealth
Health


e
e
d


ion .
measures


Rorbidity and Oualiti


Care


(Afes) .
Care in Chile
Medical Secto
s e S S i
Health Pclicy


Financing


.31


. 35
. 41
. 43
r 53
. 55


o a a a a 60
Health Policy. 66
of life 69


IBfTODUCTION


a a a a a a a a a a S a a -


In
Pu

Pu
Ch


!









Medical Ca
Medical Ca
Health
I
Possible
Methods an
Summary an


Inflation
Inflation
licj Change
lation .
Causes of B
findings .-
Conclusion


in the United
in Chile .
and Bedical


States -. 80
. 82
Care


. 83
medical Inflation in Chile 84
. 90
. .e .. 9


HELP-SEEKING BEBAVIOB OF THE URBAU
CULTURAL AND ORGANIZATIOBAI
MEDICAL CARE ACCESS .


POOR II SATIAGC:
ASPECTS 1OF
a S a a a a


Introduction
The Health C
Consumer and
Socioeccn
Spatial B
Patients
Outcomes
Freque


us.


Satisfacti
Models of Patien
Utilization o
Satisfaction
Discussion and S


e ng- e S
household Attributes
ic and Help-Seeking
avior of Patients
the Clinic .
Care 0 0


of U
on w
t Ut
f Ca
with


tili
ith
iliz
re -
Car


zaticn .
Care .
ation and


e


a r file
Profile


Satisfaction


- 5 a a S S -
5 S S e S a


uauary


SPATIAL ORGABIZA ICN
SABTIAGC .


CF PEIBABY


BIDICAL CARE


Introduction .-
Location of PHC in Sant
Thought .
Neo-Classical/Functi
Humanistic Ap roach
Structuralist Approa
The Evolution of Urban
the Social Ecology of S
Relative location an
Residential Segregat
Health Policy Change an
PMC in Santiago
Howi Public Health Cl


Clinic


Siago:
iago:


cnal


* .
ch
Stu
ait
d H
ion
d S


inics


Distribution


three


lines


Approach
Approach


in Latin


America


is a a a a a a -
tcry Settlement
n Santiago .
tial Organization
a a a a* a a a
Are Located .
d Dearest Neightor


Index
Measures of
Pacili
Distribution
Practi


Access
ties .
of iC
tioner


ability


I


a aI


ASA General
ASk General


S a e


a


n ra Cn4 4. m









Health Policies and the
Physicians in Can
Health Policies and Spa
Physicians in the
Sumaary and Conclusion


Spatial
ada .
tial UOrt
U.S. .


Pattern


an
an


Pa e o e
Eattern of


SUBIART AID COiCLUSICO


LITEBATURE CITED


ALPPu1IDIX


SPABISH-LABNGAGE


QoESTIOUAIR E


GLOSSARY


OF SPANISH HORDS


A CUO f PlS


BIOGRAPHICAL SKETCH


S S S S 0 a a a S S S S 5 S -















LIST


OP TABLES


TABLE


LAG!


Medical Attention for
Accidents and Chec


Acute
k-ups,


Chronic


Chile,


1977


Illnesses,


1983


. 20


Sources of
Level,


Medical


1982


Care


Financing


in Chile


laccra


*. o 32


Physician Inscription and


FONASA


Level


of Car


Eatient U
e, Chile,


utilization


1983


. a 41


Aggregate


Value


Health


Care


Sector,


Chile, 1969-80


S.. .. .a. 55


Enrollment


(ISAPBEs),


Provisional health


Chile,


1982-8Q


Institutes


S.a e 58


Chilean


Medical


School


Graduates


Positions


Reserved


for Thea by


S. E.S.S.


1977-82


. 62


Personnel


Structure and Change


S. N.


1970-80


- 64


Medical


Care


Inflation


Consumer


Purchasing


Power


Capita Health Care


Expenditures


($US)


Program,


1983


a a a aa aa a a ea a95


Income and Selected
Correlations .


Health


Care


Expenditure


e. a 96


Chi-square Test of
Incurring Costs,


Health
Chile,


System
1983


Affiliation


S. 98


Questionnaire


va riables


Selected


Correlates of


Quality


of Care


(QOIALCABI)


Variahisas of


nmoaranhic an r fnranniati nal


Mn As is


,









Predictors of

Patient Bespon


Medical

ses on


Care


Qualit


Accessibility

y of Eedical


(I A S E Cl 313 )


Care,


Chile,


1983


S


Outlook


on Life Aaong


Health Care


Users,


Chile,


1983


- S S S S S C 0 0 S


Nearest


Beighbcr


Formula


fcr S.1.S.S


. Clinic


Analysis


. 0 e a.


Medical Centers and


Income


Levels


Municipality,


1983


Coefficient


Localization


Results















LIST


OF FIGURES


PAGE


Structure


Chilean Health Systea


S S a a a a a a 230


Sources of


FONASA Operating


Budget


S e aa a aa a 4


Pharmacy
Public


Warehouse


F rot hes is


Items


Purchased


Health Systel ftrc Central


a e a .a a e e a a a a a 46


Contribution


Goods


to Total Operating


Services,


Se Re S.


Budget by
, 1962-83


Sales cf
. 47


Breakdown


Services,


Selected


fievenues


Expenses


Derived frca
, 1962-66,197


of S.N.S.S.


Total Goods


2-83


1 96 2- 83


. 49

. 51


Typhoid and


Hepatitis Bates,


Chile:


1966-82


. 71


S.. N.. S. So


Physician and


Dentist


Salaries,


. 86


Annual


Variation


BCPI,


Selected


Items,


19 79- 84


. 88


Aabulatory Care


(w=44U1)


Visits


Income


Group,


1983,


a oo e aa oo a a a a. a oa 94


Distance


Vectors


Between


Residences


O Higgins Clinic


Municipalities of

Income Segregation


Greater Santiago


Sa. aI S


in fetrcoclitan Santiago,


1977


Proximal


Map of


S. 3.S.S.


Clinics,


Santiago,


1983


Potential


Accessibility


Surface


to S.NeS.S S


Clinics


PIGUBR


by Chilean
Supply


Villa









Distribution of

Distribution of

Plastic Surgeon


SEBBENA


PONASA P

Offices,


Phjliciana,

hysicians,

PC1ASA, 19


1978

1983


- a S

* S *


83


Critical


Care


Me dicine


Dcctcr Offices,


FCNASA,


1983















CHAPTER


INTRODUCTION



Background


Public service


provision is


one indication


state's


role


mixture of


in social


public and


economic


private


development.


funds in


provision


services


varies


widely


in time


space


invaziatly


reflects


political


tendencie s


an administration


the current ideologies of the


state.


Federal


programs


the United States,


instance,


are


being cut


back


eliminated in


1980s


under the


Began


admini


station,


reflecting


ideology


less


govern ent


involve eaca ft


individuals'


lives.


An important


catalyst


redefinition


government spending


was the


so-called


Jarvis


Amendment which


1978.


appeared


This aaendaent


before

, often


the electorate


referred


Calif orziia


Propcsiticn


lowered


the ad


valorem real


property taxes


from


three


one percent.


The


State of California lost


about


seven


billion dollars in


that


foregone


much in savings.


revenues,


Proponents


afforded


the amendment,


taxpayers


state


legislators H.A.


Jarvis


and P. Gann.


argued


that


lower


taxes








the only way
to give them


1978,


Co-sponsor Gan


to cut
money


cost of
e first


government is a
place. (F.C.F,


425)

n added


The government has


and father
(F.O.7., 1


and


978,


tried to


we simply
425)


become uncle,


cannot afford


mother


it anymore.


Other

taxes and


proposals


wanton


government


endments

spending


that were against


appeared on


high


the ballots


other states that


legislation,


November.


and indeed its appeal


The tenet


this


electorate,


gas


that local,


miniamuma


state


level


and national go

public programs


vernments could

and services


provide

without


compromising


the welfare


general


public.


Fiscal retrenchment


has also become


evident


among


other


industrial nations,


albeit


different


reasons.


governments of


Helnut


Kohl


Nest


Germany


and


margaret


Thatcher


Great


Britain have


shared a


similar


restrictive


govern ent ideology.


This shift


towards


fiscal


retrenchment


Western


tradition


Europe conflicts


state


with


participation


long-established


economy


especially


meetings of


human service


recent


programs.


leaders of


Economic


industrial


summit


nations


have subscribed to


fiscal conservatism


it can curtail inflation.


performance


the extent


of the


that


United


States'


econo my


during


the first term


Bonald


Beagan









provide fever


community


services


private


sector


individual initiatives can


deliver


such


services.


To some extent,


this general fiscal


retrenchment


policy


can


be seen as


a backlash


the growing


tide


li eralisa


post-World


II era.


Adherents to


"less-


government-is-better"


notion in


U.S.


have contended


that


return on human investment


projects


say,


health


care,


both


difficult to


measure


does


Jield


commensurate returns.


Individual


responsibility


primary


importance


in establishing


one's


health


status.


Clearly,


U- S.


it seems that


individual


life-styles


determine,


large


degree,


health


status


that


Onie


enjoys


(Dever,


1980).


Indeed,


increasing


public


funds


the health care sector in


the


form


national


insurance


program coverage


not an


adequate substitute


what


individual initiative can provide.


though


this


health care


example


is simple,


does


underscore


a basic


premise


fiscal


retrenchment:


less government


spending


coupled


with


individual and


private business


initiatives


better


than,


or perhaps equal


state-financed


ventures.


This current


trend


against


growth


state


increased social spending is


also


evident among


developing


nations.


1970


Chilean


presidential


elections


produced


socialist victor,


Salvador


Allende,


whcse


Popular


Unity









government increased


public-sector invest ent


areas


mining,


metal


education that


processing,


the


previous


transportation,


administration


health


Christian


Democrat


Eduardo Frei


(1964-7o0)


had initiated.


reasons


be considered by this


present study,


Allende


government


armed forces


led


was overthrcwI in


General Augusto


September


Pinochet


1973


(Sigmund,


1977).


Supporters of


administration


(1970-73)


coup


wreaked


claimed


havoc


that


Allende


the nation.


They


objected


labor


to high


str ikes,


unemployment,


yor k


soaring


stoppages,


inflation,


land


raisrant


business


expropriations


that


were


seen as the


prepa ration


establishment


socialist state.


Since


1973,


Chile has


been


ruled


by General


Pinochet


whose self-appointed


term


in office


is to


expire


1989,


with


option to


continue


until


1996.


The military


government has forged


strong


ties


with


new


traditional


business


groups of


the nation and has


moved


to dismantle


traditional


political


pressure


groups


such


political


parties,


labor


unions,


student


I ve ents,


national


electorate.


Decision-rules


laid


engineers,


technocrats and economists have


replaced


these


traditional


political


players.


The military


government


Chile


(referred to as a


tureaucratic-authoritarian


state


because









the nation's


business groups


industrial sectors


to run


economy.


financial


In contemporary


highest public


officers


are


appointed


by the


President,


the state's


allegiance


is to


social control


means of


increased


participation from


private sector


there


a strong


sense


among national


leaders


that


nation


held


accountable


only to


internatio nal


lending


community.


Since


the Congress


was


suspended


1973,


there


have


been no


institutional


checks-and-balances.


tiore


importantly,


the Chilean


junta


deepened


naticn's


dependence


on international


capital


by increasing


foreign debt.


the same


time,


however,


Pinochet


regime


has received


tacit


apfrcval


from


Began


ad ministration


for


its fervent


anti-cosaunist


stance,


despite


the civil


human


rights


violations committed


the regime.i


Although


the military's


stro ng-arme d


tactics


I Under
commit
govern
waning
govern
once a
of Tor
Amnest
the Re
regime
borne
televi
Vice P
caneli


the


Carter


ted by th
ment were
economy a
ment's rul
gain. For
ture: An
y Internat
again admin
and, inde
out by corn
sion during
resident H
st fr. Kon


Administration,


e security
greatly cu
nd consider
e, human
partial do
Amnesty I
icnal Publ
istration'
ed, other
ments made
g his Octo
alter Bond
dracke: ".


y f
rtai
rabl
righ


rces


huma
of


ed. In
oppcsit
s abuses


cuamentaticn
nternationa
ications, 1
s tacit app
authoritar
by Preside
ber, 1984
ale. The P


-


a


9
1
98
ro
la
nt
d
re
re


a


the P
the 198
ion to
began
see Chi
Report.
3. An i
ial of
n over
Reagan
ebate u
sident
other


ino
Os,
the
to
le,


i


n-


atuses
chet
under a
military
increase
Evidence
Lcndon:
cation of
Pinochet
nts, is
national
former
asked by
h leaders


Chile


rights


. .the


L









have been denounced by the international


coUaunity,


been


forthright


meeting


foreign


debt


with


international bankers.


Surely,


the Pinochet government


is the antithesis


previously


elected


governments


or other


regir E S


Chile since


1932


(Caviedes,


19S79).


Two aspects


Chilean


history


make the study of


public service provision


that


country


of a


of particular


constitution


interest.


First,


as an indicator,


using


Chile


was


the

the


enactment

third


oldest


democratic


government


modern history


until


1973,


following only France


post-independence


the


political


United


history


States.


been


While


periodically


marred


short


periods of military


rule,


the demands


electorate and


the


action of


their representatives


helped


shape the

prior to


"welfare

1973. S


state"


second,


that

and


characterized


germane to


that


this


country


present


research,

has been


is the fact


world


that


reknovn for


the Chilean hea

its comprehensive


Ith care


system


coverage.


a- e -D


Beagan


responded


Philippines


that do


standpoint right
the alternative?


over


enough


revolution,


Philippines
a record


someone


now,


know
not
of d


It is a


there


look


are things


good


democratic


there


us from


rights..


large couaunist
And I think


of letting,


that


under


thought


movement


that
the


was


what
toc


ve've
guise


little


is
take


had
of
acre


right


than we would


winding up with


letting


totalitarianism.


that
pure


person go
and simple.


. -


then
the









planning


strategies have


been


acdeled


many


nations


(Roemer,


1985).


This health


care


system


undergone


change


in light

Thus, th


of the guiding


e contrast


ideclcgy


of the conservative


he current

ideology tha


regime.

t heralds


reduced


social


spending


health


care


system


that


used


to be mostly


state


funded makes


study


contemporary


Chile an inviting


intellectual


Scope


challenge.



Purpose


This research


assesses


accessibility


primary


medical


care


Chile.


Accessibility


potential


procure


care


which,


when realized,


becomes


utilization.


Primary


medical


conception;


care accessibility


that


organizational,


financial,


and


accessibility


are


geographic


examined in


reviewed


here


economic,


triers.

Chapters


broadest


cultural


These components


through


respectively. Al

in its examination


though


each charter


medical


care


builds


accessib li


on earlier

ty, Chapter


ones


provides sufficient

other chapters then


background

to be read


information

separately.


enable

review


literature that is


pertinent


tc each


particular


topic


included


in each chapter.


The study


However,


focuses on


health care


financing


patterns fo

trends from


u


nd in

previous


1983.

s years









1983-84,


and


one


month in


northern Chile


1981.


Though


work is written by


an outsider to the


public and


private


medical systems


in Chile


and


thus


may fail


provide


insight into


the subtleties


those systems


(Sidel,


1980),


benefits from more


than


interviews


with


health


care


workers and consumers,


well


as first-hand


information


obtained from


interviews and


archival


research


Public


health


departments


finance,


public hospitals and


clinics,


and


private medical


practices.


author


had almost


daily


contacts


with


users


providers


various medical


systems in Chile.


Because


much


data


are taken


from


unpublished sources,


special care has


been


taken


document


them as thoroughly


as possible.


The


methodological


approach is


appropriately


varied,


reflecting the


diverse


nature


of the


research


question


Methods of


analysis


range from


statistical


techniq ues


computerized


mapping,


participant


observation


interviews.


Every


atte pt


been


made


to document


latter source as carefully as


possible..


esplcyees


from


public


health sector


have


requested anonymity


this request has been


granted.


Such


cases


are


arguments presented


work


are


founded


these


sources.


This


research departs


from


branch


medical









emphasis on the delivery of


health


care


(see Chapter


full


description).


They


point


the iamortance


considering the organizational and


economic


structure


given delivery


system before


investigating


spatial


organization of


perspective,


place's


health care


service


policy


network.


is viewed as


From


a subset


larger national economic and


political


fabric.


Ihus


study of


geographic accessibility


primary


care


facilities


--a spatial relationship-

access cannot be gained (B


necessary then


is a


osenberg,


understand


ict endea vor

1983).


restructured


econcuic


first


financial


system and economic accessibility


health


care


(Cbacters


II and III).


Then


analysis


shifts


Santiago


purpose of


offering


"snapshot"


primary


care


system


of Santiago in


1983


(Chapters


The emphasis on


health


care


accessibility


refers


mainly


to primary medical


care


(PHC)


that


, therapeutic


curative care


provided by a


nurse or


physician.


anay


ways,


PHC is


most


important compcaent


of a delivery


system. It

given system.


generally marks


the first


The ease of care


the comprehensiveness


and quality


care


point


entry


level


into


dictates


at subsequent


levels and

attention.


the extent of

In selecting


population


PBC as


likely


the organizational


receive

level









extract


that


component


that


relates


solely


P1K..


Moreover,


dominant


consumer


health


care


fund


modern


western-based


systems


hospital.


When


data


are


disaggregated,


some


allowance


can


made


for


hospital


activities


but


this


not


always


the


case


P C.C


Every


attempt


been


made


identify


use


national


-level


health


care


data


vers us


those


which


are


exclu


sively


PMC.


This


and


study


prognoses


was


conducted


identified


bearing


three


recent


mind the

presidents


caveats


Association


American


Geographers.


Hichcla


Helburn


(1983)


called


geographers


approach


their


work


considering


affects


quality


life.


contended


that


geographical


research


should


strike


a balance


between


the


theoretical


contributions


discipline


(basic


life


research)

(applied


as vell


r research .


improvement


Heltu~r n


note


quality


highlights


significance


geography


public


policy


well


-being


assessing


public


services.


another


presidential


address,


John


Fraser


Hart


(1982)


underscored


the


importance


regional


geography


laboratory


where


description


can


provide


testing


ground


for


normative


theories


of the


social


natural


science


es-


Hart


argued


that


the


region


essential


part


geographic


research


because


provides


geographers


with









that


geographers have an


this obligation


means


obligation


learning


society,


speak


part


a "nes


audience" of


decision-makers


government


business


(1982,


19).


A recent


presidential address


emphasized


need


combined strategies in geographic inquiry.


Bichard


Sorrill


(1984)


contends that


geographers


often


use


secondary


data


whose


limitations


weakness


they


occasionally


fail


recognize.


Statistical and


cartographic analyses,


collection of


primary


data and


use


foreign


languages


should


be encouraged in


geographic inquiry.


spirit


that


the


present research


been


carried


cut.


this study


medical


care accessibility


Chile,


findings are


compared


vith


other nations in


atteart


place the changes


the Chilean medical


system


within


international


that


context.


practical


provides an assessment


that has been


the object


utility


a public


auch attention


wcrk


delivery


recent


system

years.


Developing nations


around


world face


a nuamer


problems exemplified by the


Chilean


case.


This


multifaceted


research


attempts to


make


unique


contribution


to medical geographic


inquiry


demonstrating


number


methods that


could


te employed


in assessing


health care delivery elsewhere.


The systematic


reviews









themselves to


evaluations of


other


health


care systems.


Those


with interests in


public


health


care,


planning,


urtan


studies,


Latin American studies,


human


geography


ijill


hopefully find


work


to be


rSOme


value.


Conceptual and


Eapirical


Components of


Accessibility


one


approach


health


care


accessibility


describe the attributes


population-at-risk


characteristics of

refers to the dist


the delivery


ribution and


system.

availabili


A delivery


health


system

care


providers


facilities..


I acrtant


aspects


population serviced by this


system are


income


levels,


age,


health status,


insurance coverage.


Factors


that


intervene between


capacity


to produce


service


actual


consumption


of services are


also included


studies


of accessibility


(Donabedian,


1973,


419;


Aday,


Anderson,


Fleming,


1980,


25-27).


Studies of


accessibility to


health services


cften


produce


different


conclusions,


depending


upon


which


dimension of care


is studied.


A general


frame work


identifying the dimensions of


care


is structure,


proc


ess


outcome.


Structure


encompasses those


institutional


enabling aspects


the distribution and


availability


resources..


Process


identifies the


characteristics of









status of


episode


population as a


the treatment they


result of


receive


medical


the medical


care

1 care


syJs tema.


the study of


Aday et al.


have elaborated a number


health care accessibility.


They


model


define


interaction of


structure,


process and


outcome


they


affect


access


to health


care


those dimensions


actual entry
care delivery


which


of a given
system. (


describe th
pcpulatica
1980, 26)


e potential an
to its health


Accessibility

versus realized h


can


be further


health care


events


defined as

. Potential


potential

access


emphasizes those arrangements


for the


cptential


rendering


care


to customers,


in terms of


wants,


needs


resources


that


consumers


help-seeking


process4.


Realized


access can be


separated into more


objective


indicators


utilization as


care rec

purpose,


:eived.


type,


well


as into


objective


setting,


and


sub jec ti ve


appraisals


indicators


time


describe


span involved


consumption of


health services.


Subjective


aspects


realized


care


draw


consumer


satisfaction.


Measures


consumer


satisfaction


are


patients'


evaluations


quality


providers,


care delivered,

the ease of care,


the

and


information

attributes


given


thea


providers


themselves


(Aday


et al.,


1980,


33-34;


Dcnabedian,


1980).


Health researcher A


vedis


Donabedian


(1973)


divided








conceptualized


as having


sccio-organizational


geographical components.


The former


emphasizes


non-spatial


resources in


(1970)


the


have


potential


shown how


utilization of care.


certain


Borrill


con fig urat ions


medical


care system influence access


to care.


Their Chicago


study


complex


showed


physicians'


function


referral


the hospitals


patterns


where


they


were


held


privileges.


They


found


that


percent of


physicians


sent


patients


to only


one hos


pital.


Half


of all


physicians


practiced at hospitals


that


were not


closest


their


offices.


These


unexpected


patterns


reflect


urban


composition of


the city,


the


type of


hospital


(teaching,


public


or proprietary)


ethnic


racial


make-up


the consumers.


Socio-organizaticnal


factors


account


degree of


accessibility


these


instances.


Geographic accessibility


emphasizes the


"friction


space"

care (


and the


Joseph and


constraints

Phillips,


that

1985;


travel


places


Hawley,


1950,


on getting


237).


Potential barriers


care


can


measured


number


ways,


each suitable to a


of geographic


accessibility


particular


are


purpose.

linear


These

distance


measures

, (ii)


travel


distance,


(i i)


travel


time,


(i v)


total


elapsed


ture0


travel cost.


Many


these


spatial


dimensions


are


explored


in Chapters IV









accessibility


shows,


its conceptualization


measurement


comprise


a large


set


of factors


that


influence


users.


wo guiding model


of accessibility


can


assigned


research


exercises.


To a certain extent,


there is


a degree


arbitrariness in


socio-organizational


geographic


assessments of accessibility


(Dcnabedian,


1973,


419-


508)


The reader must select


what


extent


conceptualization


and


measurement of


accessibility


are


valid


this


particular health care


setting.














CHAPTER II


BESTRUCTURING


HEALTH CARE FINAICIUG


IN CHILE


Introduction


the prolonged


economic effects


countries.


world


recession continues,


compound existing


This trend suggests that


state in financing


medical care


protleas


defining


becomes an


its adverse

develcping


role


even acre complex


issue,


subject to


a wide


spectrum


of opinions


(Deohadar,


1982;


Selling,


1981;


Zschock,


1980;


Basch,


1978;


Eenyoussef,


1977;


Roeoer,


1977a;


Unv oe il,


19741).


On one


level,


this


issue can


viewed in


terms of


governments


striking


critical


balance


between


their


intentions


to foster


fiscal


austerity and

programs. V


their commitment


to support


various constraints exist,


tasic


however,


tha


social

t imtede


an accurate

investment in


measuring

health a


of the returns

nd medical care


on human

(Hakia and


capital

Solimano,


1978;


Berg,


1973).


These constraints include,


exasmle,


escalating capital


costs;


the ccaplexity


aethcdologj


determining measures


of health


status


outcomes


(Zucitel,


1982;


Donabedian,


1980);


and,


inevitably,


competition from


other


sectors


national


economy


for the


limited


.









This chapter


focuses on


health care


financing


delivery to establish


a basis of reference


on which


cther


aspects of


medical


care accessibility


can be


gauged.


Chile,


with its


population


11.40


million


1982,


one


more developed


Third


Ford countries


(hcrris


, 1981;


James


1969)


that has been described as


1973 military


intervention


modern


brought


welfare


Iower


state.


current


ruler,


General Augusto


Pinochet,


has vigorously


pursued


subsequently attempted


institutionalize


dramatic


shifts


ideological


pragaatic


approaches


government.


The neo-classical


economic


practices


adopted


General


Pinochet


contrast


sharply


sized


socialized economies of


previous


administrations


(Balloy


Borzutsky,


1982;


Tergara,


1981).


brief


review


the


Pinochet


administration's


ideology


and policy


strategies


since


seizing


power


provides


baseline insights


into


discussion


state-financed


versus


private medical


care services


in Chile


during


this


period.


the first


three


years,


Pinochet


government


imposed measures


tc severely


cut government


spending


efforts


inflation


to control,


plaguing


eventually


reduce,


the Chilean eccncay.


spiraling


The Consumer


Rice


Index


(':PC,


or Indice de Precios al


Consuaidor)


fell


trcm


percent in


1973


percent in


1976


(Cortazar








program called


"Operation Shock"


dabbed


because


immediate effects),


returned state-owned enterprises


private sector.


enterprises


owned


state in

control


1973,


1980.


only


Other


then


actions


still

endorsed


remained in state


the neoclassical


model


of development


were the


reduction


import


tariffs


from


as high as


percent in


1974


to a


flat


percent


rate


(except for automobiles),


and the


unrestricted


flc


foreign capital into Chile


(Pfrench-Davis,


1982).


This "shock


transfer

Austerity


treatment,"


of state-owned


programs


however,


corporations


reduced eplicy ent


was not


the

the


limited

private

public


sector.

sector


percent between


1973


1979.


These


draconian


measures


were


formidable given


historical


importance


that


public sector has


in employing


broadening


middle classes


Chile and


the tenacity


which


those


employees have held


on to


their


jobs


(Bartinez and


!liroci,


1981).


Social security


health care expenditures


were


also


reduced so that


the cost of


Chilean labor,


relatively


expensive compared


to other


developing nations,


could


better


compete


the international


market


(Kornevall,


1977).


There


was even


private


central


some


discussion about


own er a,


Santiago has


thus far


been


selling


only


transfered


public


one hospital


to private


hospitals


district


management








Pinochet


government


was


position


restructure and


"acdernize"


health


care


delivery


after


reduced


state


expenditures


liberalized


ecomoEy


that


private investment


out of every five


medical 1


could be


encouraged.


consultations


were


1977,


state


four


financed


(Table


and


the


government


scught


reduce


this


dependence on state support.


robust


performance


cther


sectors of the


economy


government


economic


team,


strong


adherents to


neoclass


ical


ideas


Nobel


laureate


Hilton


Friedaan


(1962)


apply


free-market


principles


health care


financing,


thereby


increase ng


both


private


sector


consumers.


National


participation


The main


Health Service,


and


out-of-pocket


public-sectcr


reduced


medical


relative


payments


system,


contrituticn


medical care from


about


percent


1978


percent


1983w


The abrupt shift


in ideology


social


developureut


Chile


reflected


a larger


mood


cf fiscal


conservatism among


the developed


nations


(Fainstein and


lainstein,


Before


joining


the


Began


administration,


budget


analy


David


Stockman,


and his colleague


Pa le


Grasm,


argued


that


sustained government


health


care


financing


tended


"EPup


up" demand


(Stockaan and


Gram a,


1980).


Similar


views


atcut


suppll-side economics


the Chilean


health


care sector


were


1982).










TABLE

Medical Attention for Acute
Accidents and Check-ups,


and Chronic


Chile,


1977


Illnesses,
nd 1983


Percentage
Institution 1977 1983


PUBLIC


National


Other


Health


Public


Service


Agencies


57.7
11.5


49.7
9.7


SERBENA


for


(National


Employees)


Medical


Service


12- 2


15.3


Subtotal


81 .4


74.7


PRIVATE


Private Practice


18.6
0.0


No Care


23.5


Subtotal


18.6


211.,3


Total


100.0


100.0


Source: 1977


data


50); 1983


from
data


Hinisterio


from


Nedaina


Salud


(mlr .,


(1983,


Table


able I
I. 5). I


The


i impact


these


recent


developments in


health care


policy in Chile and


the changing


roles


both


privatee


and


public sector


provision


of health


care


will


addressed


perspectives


in this chapter.


in the


A review


financing


public and


provision


private


social


services is


undertaken followed


overview








major


alterations


introduced


the financing


delivery


health services


in Chile.


The Chilean


experience


illustrates problems


that


be encountered


when


majcr


policy changes are enacted for


benefit


a stox t- ter D


economic


performance


national


economy.


Public and Private


Perspectives on Health Care Financing


The role


has been di

perspectives


that


the state


scussed in

(Roeaer,


plays


numerous

1977b; Ha


health care


works


varro,


from


1974b1;


delivery


various


Sigeri


1947).


the delivery of


health


care the


public


private sectors


ha ve


basic


characteristics


that


should


mentioned for


purposes of comparison


with


tte Chilean


case.


the one hand,


public


cunership


administration


facilities allow


planners,


on a limited


basis at


least,


arrange service


delivery


(Dover,


1980).


Health


care


planning,


particular,


guides


medical


marketplace


mized


economies


when


private sector


small


or ccs


containment is


sought.


The Canadian


experience,


e x asIEle,


shows


that health care


planning


can


account


reasonably


accurate


forecasts


medical


demand


(loltz


alg,


1977;


Roos


at al.,


1976;


Spaulding and


Spitzer,


1972).


state


often becomes


main


financier of


health


care


when


purchasing power


the citizenry


in Canada,








Thus,


a sense,


state control can


reduce


highly


skewed


distribution


medical


personnel


services


that


inevitably


occurs


Mhen consumer


purchasing


pouer


caly


determinant of entry into the health system.


the other


public


hand,


health care


because


systems,


lack


of competition


the state influences


prices


and


wages in the medical


market.


icor


this


reason,


there


are


fewer incentives


for


reducing


costs


when


compared


competitive multi-system setting


(Katz et al.,


1982).


absence of competition,


furthermore,


weakens


managerial


behavior.


After all,


public


managers


have


little,


any,


incentive to


exert cost-cont rol


measures if


the financial


rewards do not accrue directly to thea


(Pomserehne


Irey,


1977).


addition,


consumers in


a state-controlled


onoploly


can


hardly


*exit"


from


that


system


(Lineterry,


1977;


Birschman,


1970)


to express


demand


changes


services.


Nevertheless, a


true competitive


marketplace


difficult to find


in any


country.


Government


intervention


health care,


existence


argument


medical


that


misinformation on


oligarchies


true competition


marketplace


(Seilly


part


weaken

can be


luhr,


the consumer


neoclassical


attained


1983).


be sure,


ccnsumers


in the


medical


marketplace


face


special


problems.


They


are more


passive


than


cther








length,


as in


many


other


markets,


rather


becomes


gne


trust.


Patients


abdicate considerable


power


their


"agents" -- physici a ns


and allied


health care


personnel--


only


because they


are


unfamiliar


with


clinical


aspects


the medical system,

(Reilly and Fuhr,


because


1983).


they

it is


know


little


rare,


about costs


even


socialized medical

do not incur some


systems of

financial c


Eastern


costs,


Europe,


alteit


when con


nominal


sumers

tcken


ones


(laser,


1976).


the supply


side


of state-controlled


medical


sjjsteuas,


salaried


practitioners


who,


like


management


personnel,


be less cost-conscious


than


ethe r


personnel


work


fee-for-service basis.


Practitioners


in state emplcywent


supposedly


behave


counterparts in


frequently


the


becomes


more


altruistically


private


sector.0


principal 1


guar


than


Although

antor of


their

the state

providing


accessible health


care,


thoughtful


discussion


about


which


medical system


creates the


most competition


will


likely


* Por


elaboration


this


medicine Onder Capi talis,


Navarro' s


arguments


C
t


capitalist state's existence


pcint,


rooa
hat
is


Bela,


see


lavarro,


London,


whole


to service


1


basis
the


976.
fcr


Cue
the


diswelfare


that


the neans of


however,
attention


to the


production
noteworthy


creates.


that


the Chilean


Navarro


gives


performance of public-sector


case,


little


medical


care


under the
this is


governments


prior


that
by


a conspicuous oversight


of Salvador
one known


Allende.


- -


tis


1








continue for some


the Pareto notion


time.


then the state


of optimality


(claiming


p o vide s


that


a service,


gains


huaan


welfare are attained only


when everyone


better


or no one is


worse off),


although an


admirable


goal


Cstrca,


1977).,


is difficult to reach


or succumb to


political


when governments change


electoral


hands


Eressure.


Health care


social


security


programs


Latin


Amer ica


have


developed


principally


along


these


lines:


political favoritism


has produced


layer


duplicative


programs


that


have accentuated


social class


differences


(Foxley,


1979;


lesa-Lago,


1978).


These


programs,


acreover,


are geared to


employees,


satisfy


or the armed


certain groups


forces.


such as


Developed


unions,


countries


state


are


exempt


froa the


problem


political


favoritism either.


their analysis of


Italian


case,


example,


Pausto


Leccisotti observe


that


government intervention


not valued by
inputs employ
politicians'


its output, k
ed thus leaving
"discretion" in


health sector
according to t


ample room
determining


for the
what to


produce and how.


(1981,


Private ownership and financing


medical


care


purest form is rare even in


UI.S.,S


largest


for-f rotit


medical


market


o rld.


Government intervention


there


ranges


from Certificate-Of- ee d


Medicaid subsidies,


and barriers


reviews,

to entry


Bedicar

such as


licensing








subsidy


suggests that it


a pure laissez-faire


system


(Gibson,


1980).


number


characteristics typif y


mixed


medical


marketplace that


tends


to fall


under


U r vat e


medical


system"


rubric.


First,


certain


types


private


for-


profit


medical


systems


such


Health


Maintenance


Organizations


(BiOs )


induce


greater


competition


which,


turn,


can


reduce certain medical costs.


The cost


saving


that result


provide greater


accessibility


improved


health status


users


than


those outside


of the


system


(Homer,


1982;


Enthoven,


1981).


vexing


problem,


however,


remains;


the one


hand,


medical


practitioners


often


invest


capital


equipment


that


raises operational


costs.


other


hand,


these


ccsts


prevent


savings


(derived frca


competition


marketplace)


from being


the private medical


passed on to the


market model


d es


consumer.


Seccmd,


discriminate


uith


regard


to age,


sex,


race.


Cn ly


purchasing power,


measured


direct


out-of- pocke t


payments


commercial


insurance carriers,


determines ace


ess


to medical


care


(lday


Andersen,


1915),


U.S.,


instance,


medicall


market"


generally


refers


private


health


insurance market


(Reilly


Fuhr,


1983).


Third,


private


market managers and entrepreneurs are


able


adjust


prices








sector may face higher start-up costs


that


public


operations


overcome more


readily


(Purst,


1981).


Private


practitio ers


procure


capital at costlier


rates but


they


allocate


funds


uith fewer


restrictions than


public sector.


One final


aspect to note


about


private


medical


sector


its ability


to adjust


prices and


engage


marketing with relatively few


restrictions.


It is


precisely


versatile


nature


private


medical operations--their


ability


to charge according


to what


market


will


bear


that sets


them apart from the


public system1.


As Posuerehne


and


Prey


have aptly


noted:


Theoretical re
dispute of whet
more efficient.


asoning alone
her public cr


(1979,


cannot settle


private


the


production


227)


The strengths


weaknesses


of each


system


acquire auch


more


meaning


when applied to


specific


geographic


political setting


which


the following


sections


address.


Public Health Policy


in Chile:


1918-1979


Tehe


European


programs that


increasingly


favored


public


financing


health


care and


social security


clearly


influenced Chile and


this area.

Germany u


Southern Cone2


Program organization


inder Chancellor


Bisaark


nations'


philosophy


1880s


progress


forth


were








precedents


(Arroba,


1979;


Roeaer,


1964).


lhat


teen


described by


undermine the


into a


Sigerist


(1 9*7)


encroachment


labyrinth of


Eisaark's


socialism


state social


attempt


Europe


programs


developed


Europe


Southern Cone.


Throughout


present century,


public


sector in Chill

financing and


has


delivery


provided


the greatest


of health care.


mt


impetus

act, the


Chilean


government is one


the oldest


public financiers


medical


care


the


Wester n


Beamiphere,


dating


back


social


security and


1918.


pension


Like the


.program


developed


public


industrial


railroad


countries of


yorkErS


western


Europe,


the strongest


trade


unions in


Chile


also


pressed


illness


insurance


programs


union


members


their


dependents.


1925,


the Chilean


governme nt


developed


child


infant


milk


distribution


prcgraas,


disability


compensation,


old-age pensions


(Boaero,


1977).


In Chile,


ideas


about


social


equality


passage

Workers


of two major

Insurance Law


health

and the


insurance


laws


Preventive


1938,


Medicine


the

(law


Decree


6117*4)..


These


laws


provided


medical


retirement


benefits to


both


public and


private


workers.


Also


created


that same


year


was


what


was to


become


nation's


largest


non-indigent


3e dical


program,


SEPBEBA


(National Employees*


Medical


Program)


(Bonaero,


1977).








so as to warrant


creation of a


central,


coordinating


agency


the


1952,


pertinent


National


legislation,


Health


Decre


Service (

e 10,383,


SiSIS)


in 1952.

passed i


an election


year,


responding to


perceived


voters'


demands.


This is a


point


that


many


cite


as a


justification


presence of


an authoritarian


govern ent


tcday.,


Unlike


civilian


govern entat


articulate health


police


authoritarian

y without ben


a


govern aents


ding


are


political


atle


action


groups that require special


concessions


(Bakia


Solima o,


1978;


Caviedes,


19814;


1979;


Hall.


Diaz,


1971).


vas


coordinate


more


than fifty


health


medical


programs that


operated


without central


administration


service coordination n.


Host


welfare


boards


private


charity


organizations


(iantas de


teneficencia)


supported


the Catholic


Church also fell


under


state administration


(Goic,


1979),


However,


many


public and


private workers


belonged


to pension


medical


groups called


cajas


continued


with


their


plans,


zany


theo still


operate


today..


In keeping


with a nell-defined trend


among


developed


countries throughout


the century,


the Chilean


health


care


system evolved


into a


high


degree


organization


bureaucracy


order


control


cost


while


also


decentralizing service delivery


(Besa-Lago,


1978).


Eoevevr,


highly


structure d


bureaucracies


are


unique









nations


(Iran


and


Colombia)


concluded


that


program


fragmentation


those


settings lead


poor


service


delivery.


State financing


delivery


medical


care


Chile


reached


its zenith


during


the


years


Allende


government


(1970-73).


after


fall,


the state's


role


health care


delivery took


different


course


with


introduction of


state functions.


incentives


privatization


response


bureaucratic


scue


maze


created


more than


fifty-five


social


welfare


programs,


thirty-one


programs


elderly,


thirty-tive


separate curative


care


systems,


the Chilean


government


cnce


again


reorganized


health services in


late


1970s.


was


Service


rearranged


System),


(National Health


into


1979,


Fund)


the S.B.S.S


and SERBENA


(National


became


the mandate of


Health


FOEASA


Decree


(Figure


The


main feature


this


rearrangement


was


that


instead of allocating


budgets


to health


districts,


N.S.


budgets mere to


be partially based on


a capitation ba


paid


to health service


districts


(tventy-seven


naticnuide).


Capitation


charges


are now


acnitcred


by a


new fee called


(factura de atencion


prestada)


help to allocate


budgets


according to


direct allocations


utilization of


that


medical services


do not adjust


instead


consumption


under


2763




















PUBLIC


SECTOR


1970s


PRIVATE


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Pens


F


Agency)
(APPa)


Prtva


und
IS


Medical


Practices


Figure


Structure


of Chilean


Health


System


Provisional
Health
Institutes
(ISAPRES)











Health Care Financing


in Chile


1980s


Health care


financing


in Chile


1980s


can


divided


into


four


types of


arrangements according


socioeconomic


criteria


(Table


The upper


sociceconBoic


strata seek

practices.


private e


care exclusively


Both ambulatory


frca


and hospital


car


solo

e are


or grcup

delivered


private providers.


up~er


segments


middle


classes


seek care


from


HBO-like


IS APBEs


(Provisional


Health


Institutes)


or private


medical


centers.


fiddle


income


groups are treated


(FONASA)


ambulatory and


predominately


least


hospital


National


percent


care.


Health


cos


Indigent


Fund


t cf


low-inccae


workers


(obreros)


receive care


from


National


Health


Service


System without


charge.


Transfer


of Clinics


From


National


to County level


Several aspects


state-financed


health care


have


changed


198O s,


One change,


stipulated


Decree


3060,


has been


the


transfer


saall


number


public


health clinics


and


rural health stations


(postas rurales)


from


S. .S.S.


management


to county-level


(municipio)


administration


(Binisterio


Salud,


1982).


This


administrative


transfer


*menicipalizaticn"


Ch a 64 e s in










TABLE


Sources of


Medical Care
Level


Financing in
, c. 1982


Chile


In comE


In-
come
Lev-
els


Size
(5)


An-
nual
In-
come
(OSS))


To-
tal
In-
come
(5)


Occupation


Source
of Care


1 I
Cut-of I
Pocket I
Eaymentsl


11.5


unskil
labor,
aestic
kers,
gents,
farmer


led
do-
wor-
indi-
small


ional
Ith
vice
ter
I.S.S.)


none


2,507


5, 1480


14,230


29.9


165,3


42.4


retail wor-
kers, self-
employed,
low-level
government
workers,
skilled
laborers


prote
siona
high-
govt.
aid-l
manga


profe
siona
high-
techn
entire


s-
ls,
level
wrks.,
evel
t.,


s-
ls,
level
ical,
creneurs


Nat
Bea
Fun
(10
pri
pub
pen
(ca


ional
Ith
d
NASA),
S. 8S
lic
sions
jas)


v. aed.
terms,
PREs
ori-
nal
1th
titutes)
v. in-
ance


priv. med.
centers,
priv. solo
physicians


grad-
uated
scale
about
half


I
1

grad- I
uated I
scale; I
at least
50-70 |
I
I

I
I
r---^1
nearly I
100l I


at 39


(1) Determined by the author;(2) Calculated








transfer


thought to


more


cost effective


because


clinics


are


reimbursed


on a


capitation


basis


that


pays


slightly


lore


than reimbursements


S. a.S S


clinics.


Municipalities


administer


clinics


for five


years,


after


which


time contracts


can be


renewed..


ensure quality


care


only


*ediua-sized facilities


with


se rice


populations


40,000


less can


districts are more


participate so that


manageable


neu


urban


program


service


(Giaconi,


1982).


Government


authorities


base


aunici palization


program


on two


notions:


administrative decentralization


efficiency.


The former


recognizes


that


local


government


an intermediate organization


that i


effective


proktle-


solving


because


municipal


officials


"know


demands


preferences of


When


people.


municipalization


(Binisterio


program came


de Salud,


on line


1982,


1981


1982,


they were


guaranteed


miniaun reimbursement


each


medical


consultation


provided..


Again,


this


scheme


wasE


devised


ensure


fiscal suFport


cnly for


medical


care


delivered and


thereby


projecting needs


avoided


based


complicated


historical


procedure


utilization


data.


However,


with all


curative


care


guaranteed


State,


some


clinic directors


broadened


scope


primary


curative care to


boost


revenues.


In some


cases


was


- t. -


t.. U 1 .t -


,? S


-s --


-*


1


_ .I








care charges


were then applied en masse..


Other


cases showed


that clinics


remained ojen


evenings


working-adult


market.


Coasanity


residents


in small


tcuns


could


visit


the clinic


evening and


receive


flood-


pressure checks.


This two-minute


procedure received


same


capitated reimbursement from


State as a


twenty


minute


medical


consultation.


light


these abuses


difficulties


d ifferenti eating


between


curative


preventive care,


the


Ministry


Health


placed


ceilings


the number


treatments that


gualifty


reia ibursement.


Before


the end


the first


year


operation ,


reforms


uere


en acte d


curtail runaway


costs


(Personal


com unicaticn,


Servicio


Hetropolitano


Salud


lot Ete,


June,


1984).


Subsequently,


a number of directors


municipalized


clinics


expressed


auch


unwillingness


renew contracts


uith


national authorities


(Personal


communication,


Directors


aunicipalized


The


primary


fixed reimbursement


care facilities,


ceilings


April-July,


limited


1984I).


profit-making


capabilities,


which in


tern


reduced


capital


investment


staff


increases that clinic


directors expected.


Municipal


authorities


have expressed


interest


assuming


clinic management


only


the best


organized


staffed clinics.


metropolitan


the health


Santiago


district


(comprised


southeastern


Icw-income








Suroriente,


July,


1984).


High-income


districts


northeastern aunicipality of


Condes,


however,


have


greater


success


this


venture.


Given


capital-


generating


potential


that existed


(although funds


uent


hiring staff


buying equipment),


there


is suspicion


that


long-range


management of


program


health


goal is


not


facilities tc


merely to


another


layer


shift


public


bureaucracy,


to set


stage so


that


private


medical


firms eventually


can manage these


facilities


(Jiaenez


Jara,


1982a).


There


evidence


that


"aunicipalization"


daily clinic


program


opera tions.


will change the

A sore credible


efficiency cf

justificaticn


suggests


that


private


management


will


take control


long-run, an idea


alluded to


a policy


statement


issued


the


Ministry


Health


mcnths after


1973


military


intervention


(Spoerer,


1973).


Hew Fee


Schedules and


Health Care Financing


IBlen cI


difficulties


in establishing out-patient charges


developing countries have been su aed


well


Eoland


Young


(1983),


state that


real


costs


cannot


identified;


only


"corresponding


costs"


can


Le derived


for


purpose of estimating


medical


charges.


A formidatle


change in health care


financing


resulted


with


transition








SEBE HE il


FONASA


delivers curative


care to


middle


inDcoe


groups


(eapleados)


but allows consumers


to select


frcm


greater


number


providers


from


public


private


sectors


tha n


SI ft h EN A.


SEB~1NA


was susceptible


number


of abuses


that


were


corrected


under


FCR4ASA..


Physicians could,


for example,


overcharge


patients


expense to themselves or


patients)


simply filling


voucher


and later


redeeming


an abuse


that


teen


recognized even


Ch ilea n


Medical


Society


(Coleqic


Bedico)


(Entrevista


con


Luis Gonzale


Search


1983).


Also,


under SEIBIBA


patients did


have to


present


identification


Thus,


third part


was easy


before


non-members


receiving


to gain illegal


voucher.


access


into


SERBENA


medical system


even


though


vouchers


were


purchased


(Ochoa,


1978).


To avoid


these


abuses that


plagued


SERMEBA,


PONASA


patients now


present


iden tift ica ti n


third


parties


(bank


tellers


or FONASA


clerks)


part


the voucher


before service


rendered.


FONASA is divided into three


levels of


care


into


which


both


consumers


providers


(physicians,


aiduives,


physical


therapists,


freely


nurses.


enroll.


medical


There should be


hnologists,

no clinical


laboratories)


difference


medical


care among


these


levels,


younger


physicians,


general


practitioners,


non-specialists are concentrated









select a


main


specific


attribute of


provider and level


"tree election


care,


s~ys te "


is seen


(sistema de


libre


election)


. At


each


level


of care


the government


contributes 250


pesos


(about $3.


voucher.


example,


1983


a Level One


voucher cost


patient


pesos,


Level


Two cost 500


pesos


($6. 00),


Level


Three


cost


pesos ($9.00)


Patients


purchase


combination


vouchers


(depending


on the service)


turn


thee


ever


the medical


practitioner upon delivery


service.


cther


words,


the new


PONAnA fee schedules


translate


into


a state-


subsidized curative care system


percent


three


respect ive


levels


care.


The government


contends that


this differentiation


select


their
79; a


the health


budget
author's


care


levels


allows


professional


and preferences.
translation)


( CDI PtA N


users


according


1983,


variety


funds for health


public financing


care financing


schemes exist

other country


i


to earmark

es. In


Canada,


example,


a special


sales


helps


to finance


hospitalization costs..


Erazil


uses


tariffs on


agricultural


exports to finance


rural


health


services


(Bach,


1978).


working Chileans


their wages


other than


to FONASA


laborers


or other


must re it


government-a approved


percent


health


system by means


payroll


deduction.


In addition,


they


must


r- -


specific curative and


therapeutic charges.


Handatcry








wages and salaries


have been


directed


to a


curative medical


care


system of


consumer's choice.


determination


the new


six percent


health care


withhclding


(cotizac cn)


not as


yet been disclosed


publicly


(Personal coaaunication,


LOUIBSA


officials,


October,


1983) ,


to those seeking


understand the financial


workings


delivery


system,


appears to


be an arbitrary decision.


There


is good


reason


to suspect


that


the increase


is an austerity


measure


confront


payments:


fiscal crisis and


Chile has the second


to meet


highest


foreign


capital


dEb~t


dett


Latin


America,


following


cil-rich


Venezuela.


Though


evidence on curative medical


care financing


around


ucrld


indicates that


partial


payment


enhances


credibility


public medical services among


users


(Kohn and


White,


1976),


the


0 NASAI


price


hikes


are


token


costs for


consumers.


Real


wages in


Chile fell by


percent


over


past


decade


(Cortazar,


1983).


Furthermore,


severity


price


hikes

134.8


uas measured

percent in


ty the

the last


National

quarter


Statistics


1983:


Institute

the second


highest


increase of


items that comprise


the Consumer


Price


Index


(IPC)


(Alzas superiors al


prcductcs


3 Per capital


national


debtor nations


debt figures


derived


for the


in Latin America are


leading


Venezuela,


$1,738;
$1,235;


Chile,


$1,507;


lexic o,


Argentina,


$1,132.


$1,374;


PcEulaticn


data


Costa
for c


Bica,
oaputing








del IPC,


9 October


Beyond


1983).


the normative scheme of


PO ASA program


very


different


record


satisfying


consun er


needs.


1983


survey


of 2,820


persons in Greater


Santiago,


undertaken


researchers from a


Health and Gallup Chile,


University


Inc00


Chile's


ranked four


School


types


of Public


Private


medical


care


(private


clinics,


pre-paid group


practices,


private


individual


practices,


care


given


friend


family)


and four types of


public


medical


care


(armed


forces'


programs,


S N.S. S.,


FONASA,


other


public


programs)


(fedina,


this ranking


was based on


the utilization


medical


care


for acute


chronic


conditions,


hospitalization,


check-ups,


dental


care.


JO AS A


users


had


lowest


average


utilization


rates among


eight


systems studied for


five


types


care.


Furthermore,


was


found


that PFOASA


users


highest


rate


percent)


of non-utilization for


These findings


n.d.).

group,


FONISA


suggest


patients have


acute care


that


incurred


needs


as a middle

the greatest


(ifedina,


inccae

relative


costs among all health


consumer


groups,


thereby


reducing


medical


demand


A major


the lowest


premise


of the


levels


FCBASA


in the


nation.


Srcg ra


that


technical competence of


curative care


identical


three levels:


only


amenities


such


as office


or clinic


n, 6, ),









among


70 NIA SA


patients


nor their


satisfaction


with


Dew


system.4


Supply and demand forces in


the


'ISV


POAS A


hierarchy,


as measured by the


Proportion


of physicians


patient


s in


each


level


care,


have


to reach


state


equilibrium.


Table


shows


that


level


(the


least


expensive level


care)


patients


have the


least


access


physicians


while


Level


three


patients


enjoy


most


favorable


physician-to-population ratio.


Physicians


are


clearly more attracted


to the


higher


levels


care,


while


most


pa tients


opt


the least


expensive care.


A breakdown


inccme


sources during


first


three


years of


BFOASA operations is presented


Figure


Direct


fiscal support


as the sales


trade-off


between


to FCNASA


me dical


has fallen


vouchers


fiscal support


almost


have


and


increased.


cut-of-pocket


same


rate


'Ibis


payments


expresses the aims and


philosophy


the social


devEloF1Elnt


model


present Chilean


government.


* The


Ministry


Health in


numerous occassious


that a


Chile has stated


major


survey


to the


ress


r users co












TABLE


Physician Inscription


10 NASA


Level


Patient


of Care,


Utilization


Chile,


1983


Physicians


Patients


Attended


.
I Level of Number X lumber % 1:B/A
I Care
p


One


2839


36.3


1,552,055


48. 6


3440


44.0


1,324,145


41.5


:385


Three


1543


19,.8


319,948


10.1


So urces:


Physician


data from


"Directorio


por profession


hasta
teuber


17:00


horas


* 1983,


10-09-83,


National


unpubl~i


Health Fund


shed


(PO I A SA)


data,


Sep-


De arta-


aento de Operaciones;


Patient


data


from


"IFre cuen ci a


segun


canti dad,


horari c.


item."


nc date,


PCNASA,


antiago,


Pension


Pun&hAgsc~ies


(APPs)


Chileans


that do


place


their


monthly


rage


deductions in


prepaid


medical group


practices or


P0 NASA


can


elect state-guaranteed


Administradoras de


private


Fondos de


[QUnsicI


Pension).


fund


Since


schemes


1981,


(AFEs,


APPs


have accepted


monthly


wage


deductions


and interest


accrues


on unused capital.


1984


government


approved


nlan


- .. -


Kb


*


.r


r


















70


60


50


40


30


20


10


"*"***... ddirect
**l***...ufispcal
"" f***** i S.... a I"**. .u p o rt
"Slllllllllll~lllllllllllll"'ll***,*


pens


medical voucher
,. #0 Q !.* 0


funds (cajas)


sal


(bono


980


1982


1983


Figure


Scurces


0 N A SR


Operating


Budget








their


clients'


funds


in private


firms. s


According


government officials,


profits generated


from


ifi e stEaE t


will


be high,


there


is good


reason


skepticism.


November,


1981 collapse of the short-lived


(1977-81)


Chilean


economicc miracle"


and


high


per-capita


foreign


debt


suggest


that the


state is searching fcr


scarce capital


the aftermath


a major nonetarist


failure.


Ire a sury


officials


(Sinisterio


fl Hacienda)


have


privately expressed


doubts that the government would


te able


insure


fully


AFPs


should


they


default


(Personal


conaunicaticn,


Departamento de Hacienda,


1984).


The


Production of


Health


Care


Chile


turn


market-oriented ecCnomy


brought


marked changes


the S.U.S.S.


budget


allocated.


sa..~S, S.


delivers


its medical


care to


most


Chileans,


blue-collar workers


and indigents


country.


mentioned earlier,


about


percent


population


receives


1977,


aabulatory


and about 50


or hospital


percent in


care


1983.


from


S. B.S.S.


Implicit


shift


away from state


financing


of health care


services


notion


that increased


health


care


budgets


(inputs)


necessarily


bring


about concomitant


lr ro venenat s


health status


population


(outputs).


fact,









pressure


groups in


Chile


have


historically argued


opposite:


more resources


yield


better


health


(Baczynski,


1982;


Besa-Lago,


1978;


Ochoa,


1978).


major changes


the allocation


resources


main


public


health


delivery


system in


Chile,


the


S.B.S.S., are


outlined


this


section.


This is


the first analysis,


to the


knowledge


the author,


income statement account


trends


1962-83


period.


In line with a subsidiary


role


the delivery


goods and


replaced the

de Abasteciai


services in


public sector,


main supplies purchasing

ento (Central Supply Wa


S.I.S.S.


organism,


rehouse),


the Central


the only


purchaser for


public


medical systems..


Free-aarket economics


dictate


that


more


suppliers of


medical


care


items


(medications,


medical


equipment,


beds,


drive costs


down.


Figure


3 illustrates


the relative


decline


Eharaacy


and


prothesis


Central


Supply


items


purchased


Warehouse.


by the


Since


1974,


S.a.S.S.


private


from


wholesalers


have


been


able to


offer some


lower cost iteas


public


hospitals and

the Central Su


public clinics. Thi

pply Warehouse frao a


s policy

virtual


change removed

uoncpoly (89


percent


1975)


to a supplier


only


percent


phbarmacy


prothesis


items


1983.


The Central


Supply


Warehouse now


sells to


private


sector and


increased








opening


also


itself


purchased


to private


more frcm


suppliers,


ualtinaticnal


S. N.SS.


manufacturers.


Imports


foreign manufactured


medications


prcthescs


increased from


about


Percent


perc en t


between


1979


and


1983


(Lagos,


1984).


Since


1962,


when detailed


iaccae statements


came


into


use,


the sale of


gcods


services


has never contributed


more


than


percent


the


S. 1S.S.


operating


tudgct


(Figure


Within


that


percent


margin,


however,


revenues have climbed


and fallen according


health


policies of


markedly


Alesandri


four


under


( 19 58- 6 4)


administrations.


conservative


and during


This


government


early


item increased


JorgE


years


liberal


Christian


Democratic


government


Eduardo


frei


(196-4-70).


Subsequently,


Pinochet


government increased


revenues


(i..e~,


charges to consumers)


from


medical


care;


again,


within


percent


margin


that characterizes


twenty-one


year


period.


A breakdown of


revenues derived


from


total


goods


services within


S. .S.S.


is presented


Figure


Despite


a short


period


data


unavailability


from


1967-


(due


to a change in


accounting


procedures specified


General


Comptroller*s Office),


three


trends


are


apFarent:


the sale


medications contributes


insignificantly













100

90

80

70

60

50

40

30

20

10


1974


76


78


80


1983


Figure 3:


Pharmacy and Prothesis Items Pcrchased by Chilean


Public


Health System froa Central Supply


Warehouse


Da ta suc!Rlns e


Ssrvirir Nacnal uics




























































1902 e8 e4 8 66 87 88 6 70 71 72 73 74 7 e T77 78 79 808 e 82 63


Figure 4:


Contribution tc Total


Goods


Service


Operating
. So .S. So


Budget ty
. 1962-83


Sales


fln4.n


Cennrrna


fall nna


TE r-ctrfic e4 3r i n


-3


al








S EBR ENA


(1972-80)


and FOMASA


(1t98 0-83)


white collar


middle class


workers


have contributed


about half


revenues


under the


"goods


and services" rubric.


Thus,


the


percent revenues from


gcods and


services


.5-S


public health facilities,


about


half


revenues


percent


of the


total


operating


budget)


are


derived from


white-collar


workers


opt for


the less


attractive


facilities of


S.N.


S5 .s


selection


S, N~S.


public


health facilities


white-collar workers


geographic proximity to


work


residence,


attraction


using


less expensive


levels of


care


(among


aulti-level


spstens


of care that characterized


SEBBENA and


PC NASAI),


perception


that the


S.LoS.S.


medical


personnel


deliver


quality


care.


These


possibilities


will


considered


Chapter


A final item


production of


public


health


care


Chile is


shown


in Figure


Turning


the expense


side


S.B.S.S.


operations,


three


items


were


considered


Lion8


1962-83:


personnel,


pharmaceutical and


p ro thesis,


real


investment.


However,


personnel


expenses have


been


smaller


since


1973.


Personnel


expenditures


(salaries


wages)


increased steadily


governments.


from


Since


1962-73,


outset


years


present


populist


regime


Chile,


personnel


expenses have consumed about


percent











































medical voucher
sales (bonos)


med


cati


on sales


primary care


revenues


*0
o\
0'


** .* .


1962 63 64


65 66 67 68 69 70 71


72 73 74 75 76 77 78 79


80 81


82 83


Figure


Breakdown


Services


Revenues
. S.E .S.S


Eerived


- e


1962-


frc6r
66,1S


Tctal
72-83


Gccds


'No te,


f l+a


wo rn2


iinn ns4 is Ii.,


r


- a -


- r n U IA I


In-,'


.In


J


E








consistent


with


earlier


reports


from


both


Chileans


(Belaar


et al.,


1977)


and foreign analysts


(Mavarro,


1974a)


who based similar claims on


interviews with


health


workers.


Lastly,


real investment


primarilyj egui ment


purchases)


been


somewhat


cyclical


less


than


percent


expenses


under


administrations.


In short,


trends in the


production of


health


care


indicated


selected


accounts


from income


statements


sugg est


four


poiUtse


First,


mcst


supplies


are


nab


purchased for


public medical


care


the open


market.


longer


does


the Central


Supply


Barehcuse


sell


exclusively for the S.SLSSS.


although comparative


prices


from


other private


competitors


Uere


not considered


here,


is assumed


that


public health


facilities purchase


a tout


percent


their


(1984)


supplies from


private


distributors


who offer lover prices than


the Central


Supply


Warehouse.


three-fold


increase in


proportion


medications


purchased from


foreign


producers


was


noted


between


1979


1983 and may,


long


run,


strengthen


the comparative


advantages that


foreign


pharmaceutical firas hold


Chilean


market.


Second,


less


than


percent


S.. N. S. S.


services.


budget


This


been derived from


sale


percentage has fluctuated in


goods


accordance


uith


the health policies


fcur


governments


power from






















* *-..


4.,


/'




























pharma





*
A. *
4 yDflt
4Ol Il0 I


4

I,


1982


1970


1983


Figure 6:


Selected


Ex pe ns cs


S0N.SC .


1962-83


personnel








































ceutical & prothesis.*
0
a
*
a
a


**


















*
a8
^* 4t*euu^
































**


m
n t nt
.*
S

;' a -
'** ^ in v es t ~









financing of


of-pocket charges


public health care


under


in Chile.


Pinochet


Clearly,


government


acre


have


out-


been


levied


than during


Allende


period.


Currently,


however,


the relative contribution to


than


total


during the Christian Democratic


budget


no greater


government


late


1960s.


Third,


of all


gcods and


services


sold


a He So S0


facilities,


users of


the trend


has been


to receive uore


SEE LER BA


revenues


(until


troa


1979)


and FO ASA


(1980-present).


Convenience


or continuity


care may


account


for this


cross-cver


from one


public system


SoleSe Se


here amenities


latter


(laG.


waiting


time,


facility cleanliness,


crowding)


are fe..


Finally,


personnel


1972


expenditures


to roughly 55


have


dropped froa


percent


high


1980s.


this


trend is


consistent


with both


retrenchment


tctal


personnel employment by the


S.8 I.S.


between


1970


1980


and the


purchase of


more high-technology


medical


eq uif ment..


This


latter move


been


the focus


much


concern


akcat


the concentration


resources


capital


equipment


hospitals as opposed


to ambulatory


care


centers


(Jimenez


la Jara,


1982b).


middle-class


systems


percent in








Bxpandinq Role of


Private


Medical


Sector


Free-market approaches


health


care


sector


Chile,


economics,


America.


while clearly


are


tied


without


Bra zil


moved


the neoclassical


precedent elsewhere


toward


school


La tin


privatization


certain


aspects of


curative care system


an attempt


spur competition and


drive health


costs


down.


1S76,


percent


of Brazil's


hospital


patients


were


treated


facilities administered by


private


management.


1981,


that


figure reached


percent


(Bezende


Bahar,


19se).


This contractual

private sector


arrangement in


assume a


Brazil


greater


share in


allowed

health


the

care


delivery


while freeing


public sector


scae


cost.


Public expenditures


Chilean


health


care


sector


have


decreased


since


1974


while


pr ivate


e pen di tuare s


hanv


risen


(Table


Though a


disaggregation


public


private component s


not readily


available,


likely


that a


large


part


increase


private sectcr


due to capital

sector expendi


purchases,


tures


further


possible


refinement


through


private


a disaggregation


office data


(Servicio de Iapuestos Internos)


facility


type


(hospital,


clinic,


group


practice, solo


practice),


this


information is


not accessible


public.


keeping


with fiscal


restraint intended


to avoid









International


Monetary y


Fund


(IMP)


Stand-by


Agreement


1984w


This


agreement stipulates


that


non-financial


public sector


deficit


(net


government


indebtedness


non-


financial


public enterprises)


cannot surpass


percent


the


Gross Domestic Product.


been


predicted


that


large


198ft fiscal


deficit,


up from


1983


level


percent,


uill


give


rise to greater


public borrowing


frco


domestic


banking


system


(U. s.


E3 tassay,.


Santiago,


1984).


At least


implications can be drawn


about


impact


this borrowing


vill have on


medical


care.


First,


ucli-


financial


debt


will


likely


keep


fiscal


support for


medical


care at


recent


levels or force


tudget cuts


order


comply


with the IMF


repayment


schedule.


other


words,


downward


trend


public


funding


health


care


(Tatle


will


probably


continue while


private


investment increases.


Second,


and in support


of this


latter


projection,


private


medical


care


invest en t


should


increase.


1984


IL.50


labassy


report from


Santiago


reports


that


medical


equi aent


instruments are one of nine


major investment


prospects


U. S.


suppliers.


public


Unless consumers


health systems


new


reduce their


being attended


demand


medical


services,


further


public retrenchment


will


send


some


public


users to


private


providers


(U.S.


Embassy,


Santiago,


1984).










TABLE


Aggregate


Value


Health


Care


Sector,


Chile, 1S69-80


millions


1980


Eesos)


Year


Total


Private


Public


Prijate


1969

1970


1974

1975


1976

1977


1978

1979


1980


26,708

27,625


21,666

22,520


23,019

27,141


29,161

29,654


31,709


14,089

13,557


11,134

12,995


14,210

16,337


18,344

10,036


20,945


12,619

14,068


10,532

9,525


8,809

10,804


10,817

10,618


10,764


Sources:


Viveros-Long


(1982),


cited


Baczynski


(1982,


15)~


Viveros-Long uses


data front


Bancc


Central


(Chilean Reserve


earnings are taken


hospitals,
physicians.


clinics,


frcu a


Board) an
national


laboratories,


private sector


sample
medical


of private
centers, a


Prepaid Group


Practices


A 3ain


feature of


Chilean


government's


plan


reduce


dependence


on state-sponsored


medical


care


been









Health Institutes


(ISAPRBEs),


are similar


Health


Maintenance Organization


(HRos)


in the


Un ite d


States.


B E~ s'


cost-


health-etfectiveness


have


been


nlf


illustrated


(falkson,


1981).


Chilean ISAPBEs are organized


and financed


along


a continuum


ranging


from


closed-model


EHO,


typified


in the United


States


Raiser


plans,


less centralized


Individual


Private


Practices


(IPns)


that


enter


into service


arrangements


with


licensed


medical


personnel for


the delivery of


care


individual


providers


on a fee-for-service


kasis


rather


than a


salaried


cr group


practice basis


(Shouldice and Shouldice,


1978,


34r9),


Some


ISAPBEs


and


operate


payment review,


as indemnity carriers


marketing,


that


provide claims


management,


assume


risk for


subscribers


at a given


level


care.


Thuas


highly-structured and


authoritarian


regime such


as Chile


(Caviedes,


1984;


O'Donnell,


1978).


ISAPBEs appear


to be


technical rather than

need for reducing soc


political


ial spending,


should enhance the adoption


solutions to the


pragmatic


lSIIflEs


perceived

view that


public


(Stcne,


1980).


Since the


passage


of Law


Decree


3626


Novea er


1981,


employees


have


been


able


place


their


mandatory


monthly


health


care


withholdings into the


ISAPBE


their


pref eren ce.


Subscribers


also


incur


monthly fees


and,






therefore,


is not


surprising


that


ISAPREs


are


marketed


higher


income


groups


who earn a


monthly


salary


at least


40,0000


pesos


(about


OS$


500.00);


that


say,


ui~er


guintile of


total


wage earners


(Table 2).


'ISaPE Es


are


necessarily selective,


owing


their


high


operating ccsts.


These


high-income


workers


have


dependents


morbidity risks


(ISAPRES,


1981).


The geographic


location


most ISAPRE facilities,


practitioners,


consumers


high-income neighborhoods of


Chilean


cities of


Santiago,


Valparaiso,


Vista


del


har,


Concepcion,


attest


upper-income clientele


that


ISAPEEs


seek


recruit.


Although


performance of


pre-paid


group


practices


the O.S.


been


encouraging,


the Chilean ISAPBEs


have


less


S success


than


originally


expected..


Since


their


colmmenceaent


1981


until March


19 84


cnly


practices


captured


estimated


187,000


beneficiaries


(365, OOQ


unofficially).


Furthermore,


three


largest


ISAPEfrs


have


consistently


share,


held


a percentage


between


60a


that has


nd 70

been


percent

gradually


market


declining


signal


emergence


acre ccaFetitive marketplace


(i.e.


one


with


mO re


suppliers)


future.


ISAPRE


growth


lags far


behind


original


estimate


of one


million


subscribers in about


operational by


separate


1983


practices


(Entrevista


that


ccn


were


ft.


Crtiz,


August


1981;


cited in Jimenez,


1982a;


POlRA SAl,


1982).










TABLE


Enrollment


Provisional
Chile,


Health Institutes
1982-84


(ISAPE s),


Both


Number
of
Policies


Saber of


Official


Enrollees:


Unofficial*


number
of
ISAPREs


Share
Large
Three


1982


Sep.
Oct.
Nov.
Dec.


85,536
85, 577
84,996
84,726


255,000
255,000
255,000
254,000


76.0
74.6
74.5
74.1


1983


Jan.
Feb.
Mar.
Apr.
Hay
June
July
Aug.
Sep.
Oct.
Nov.
Dec.


,000
,000
,000
,000
,000
,000
,000
,000
,000
,000
,000
.000


599
253
257
621
075
869
683
078
005
213
374
236


1984


Jan.117,997
eb. 120,685
Bar. 121,827


471,000
482,000
487,000


353,991
362,055
365,481


57.7
57.1
57.6


*In
the
4.0.
chan
enac
the
poli


1983 the N
estimated
Do public
ge, which
ted. Total
original r


c!t


are


i

a


tional Beal
umber of en
explanation
increased en
in the "un
te of three


presented


Pund (
lees p
s been
leent
icial'
rsons


as a tasis


changed
cy from 3.0 to
as to why this
third, was
are based cD


aer
of comparison.




The action


taken by


the government's


Department


ISAPRE Coordination


follows


a veil recommended


policy


CCurse


that


medical


care


delivery


and financing


both


public and


private sectors


coordinated


central


agency


(Mlach,


1978;


Hesa-Lago,


1978).


the Chilean case,


however,


it appears


that the


IS1IPBEs


are


drawing


patients


from


JON A SA


Level


three care.


public


health


officials


contend


that low enrollment


ISAPfEE


is due


ucrld


recession and


price


earned


by Chile's


chief


export,


copper


(Personal communication,


Ernestc


Tupfer,


October


1983).


One caveat for the


lesser


developed nations


that


have


uncritically adopted


foreign


technology


organization


schemes is that programs meet


the specific


needs of


adopting


nations


(Polgar,


1963).


number


ISAPEs


have


sought


consulting services


from aid-western


tased


EM ~Os


United


States


where the


income


levels,


ethnic


composition,


help-seeking


behavior


popculaticn are


quite


different from Chile.


In a


sense,


therefore,


ISALPE~s


anachronistic


in Chile.


They


demand


expensive


premiuls


women


working


the home


(housewives)


are


reproductive age.


Three ISAPREs


specifically


reject


enrollment of


dependent


women


working


outside


home)


all


under forty


years of age.


women certify that


they


are


Still


others


pregnant.


require


Ubjic


that


these


practices might


be culturally


acceptable


United








States


where


prepaid


medical


group


practices


have evolved,


they


against a


very


long


tradition


Chile


where


medical


systems


have


been


recognized


internationally


their


aamle


provision


maternity


health


care


programs


eza,


1984).


Traditional


vollens'


health care


programs


helped


place Chile among


those


nations


with


the highest


perc


entage


female labor


force


participation


formal


sectcr


(Covarrubias and


Franco,


1978).


Administrative


Before and


Health


Policy


Celiberation


the detriment


of health


policy


Chile


there


been


an open


debate


refcr as


enacted


last


few


years.


Experience


in Israel,


Lar


example,


a highly


politicized nation


like Chile,


shows


that


public


debate


issues of


medical


care


social


security


good


precondition


program adoption


providers


consumers


(Tishai,


1982).


the elimination


the Chilean


laticnal


Health Council advisory


board


well as the suspension


the national congress,


political


parties,


and


elections,


impeded


discussions prior to


acceptance of


health


policy


reforms.


One Chilean


physician n


health


services


researcher noted


that


an unbalanced
Ministry (of


Dy a group
authority.


power
Health)


person


There


is


nOw


concentrated


and health d
s designated


is no


decisions


the
made


a political


participation








past,


the Colegio Bed ico


acted as


a professional


society with


legal


input in


health


policy


matters


such


fiscal

hospital


allocations,

I care, and


fee schedules


I establishing


for ambulatory


administrative


organization


boundaries


(hospital


service


areas,


health


service


districts,


and


rural


medical


rounds).


This


legal


relationship change C


1979


with


issuance


Decree


3601


which


reduced


legal


status


association


e re


voluntary


association.


Physicians


are


longer


required


to belong


Coleqic


Medico and


information


physician incomes,


working


conditions


other


data


critical


to successful


health


care


planning


(Mach,


1978)


are


now more difficult


to obtain.


Physicians are


forbidden


from


meeting


public


hospitals


clinics to


discuss


"_On-


clinical


matters.


Inputs


into


health


Fe licy


physicians


are


more narrowly


represented


than


ever.


Bore


than


two-


thirds of the


Ministers


of Health


since


1973 have


been


DOD-


physicians.


Information


flows


from


Ministry


cabinet


downward and,


this regard,


similar


decisicn-


raking structure


noted


by Ogalde


(1978)


his study


other authoritarian


governments.


The Colegio


e dico


argued


that


only the


state


can


afford to


assume the


projected


1983


deficit of


U. s.


million in


state-sponsored


curative


medical


care systems.


- t -


at qLr, t .. & -


I


,,,,


-- r _-


r,,.,,~ ,,








The simple game


equivalent to
(this in turn)
accentuating


(market)
planning


distorts


their


generating undesirable


Medico,


1983a,


no page;


s up IlJ


demand


human resources .


health


power


care


professionals,


distribution


ethical


prcbleas.


and
(Colegio


author's translation)


Physicians also


system as the cause of


view the


their


mc,.


growing


to a more


under-


market-oriented


un-E aloyed


numbers


(Colegio Medico,


graduates hired by


1983b).

public h


fropcrtion


health sector


medical


declined


three-fold


between


1977


1982


(Table 6).


Traditionally,


80 percent of


graduating


medical


class


found


work


with


the state,


while the


remainder


the class


went into


full-


ti ne


pri vate


practice,


sought


specialization


a bro adi,


emigrated


(Colegio


Sedico,


1983b).


TABLE


Chilean


Medical


Reserved


School


for Then


Graduates and


S18SS 0..S.


Eos it ions


1977-82


Year


Number of
Graduates


Number


Positions


Reserved


(B)/(A)


1977
1978
1979
1980
1981
1982


71.7
52.0
47.2
50.9
25.6
24.1


596


Source


: Colegio


Santiago,


Medico de Chile


(A.G.),


Algunas Consideraciones sobre


Consejo
la Salud


Regional,
en Chile,








One


revealing g


trend


this substitution


physicians


is that


over


past


decade,


n~r se s,


midwives,


medical


technologists have


increased


within


the state


medical


sector


(Table


many


have


assumed


tasks


previously done


ph ysicia ns.


Substituting ancillary


personnel for


physicians


a well recognized


cost-savings


meas ure


(PAHO,


1982).


long


waiting


lines


crowded


conditions characterize


most


the sixty-six


public


health


clinics


in Greater


Santiago


and are


the result


too fee


physicians


S. II.Sa S.


is common


that


lines


forum


outside clinics


several


hours


before


they open


presupuesto


para


gobierno


mejorar


data


apoyo


ate ncion,


adicional


June


1984;


Consultorios de salud,


10 December


1983).


under-


un-eaployment


physicians contradicts


apparent


shortage of


physicians


in Santiage


clinics and


long


waiting


lines.


Augusto Schuster,


President


Republic's


personal


physician and


cabinet


member


Ministry


of Health,


contends


that


alleged


"over-su ly"


physicians


is the


result


"university-for-all"


policy


of the


Allende government


( Barcha


capas


blancas,


March


1980).


Limited


positions in


the


public sector


have


forced


growing


number


physicians


intc


private


sector.


surrogate measure


this growth is seen


the nuater













TABLE


Personnel Structure and


Change


S.I S. S,


1 970-80


1970


Ratio
per
10,000


1980

Batio
per
10,000


Personnel


lumberr


inhab.


luaber


inhab.


Change (5)


Physicians

Dentists


4,401

1,140


4.70

1.22


4, 128

1,752


3.78

1.58


-21

+30


Pharmacists


Nurses


1,666


1.78


2,509


.18

2.56


Physical
therapists

Midwives


174

1,101


.19

1.17


360

1,839


.32

1.66


+107

+42


Matri-


tionists


Medical
technol-


agists


+1023


Other


Profes-


1,381


1.47


1,283


signals
(non-admin.)


I Total 10,933 11.67 13,563 12.20 +5 I

I I
I Source: Modified from Medina and Kaeaptfer I
I (1982, 1004). I
I I


1970-80








there


nBSa


percent


increase


these


listings


(Jismnez


Jara,


1982b).


This


would


sees


to indicate


that


private


medical sector


Chile


growing


rapidly.


However,


number


physicians


their


incomes


OlSE


unknown


because the


Coleqic


8fdic~o


restricted


gathering this information


(Colegio


Medico,


1983c).


Current disputes between


Ministry


Health


Coleqio


Hedico are


significant


in light


historical


importance that


physicians have


in Chilean


politics


design of


national health


care


policies.


Between


1833


1973 there were


senators


representatives,


one


and one


president


who were


physicians


training


1983).


prior


Moreover ,


to entering


the Coleoio


Eclitical


Bedico


office


saS


(Cruz-Coke,


catalyst


formation of


National Health


Service


1952,


Curative


first


Medicine


professional I


1968,


organizations


1973


to call


was


for the


one of


resignation


fellow


physician


then


President


Republic,


Salvador


Allende


(Chanf reau,


1979).


Despite the historical contributions aade


physicians


the Colegio


Medico in


the areas


of social


legislation,


the present


government argues that


neither


the coverage


nor


quality of health care has


suffered since


outset


the


modernizationo"


ref oras


recent


years.


The


present


o ic- p e sid e t


- -


-


-


A








private)


at various costs,


is thought to


best


force


providers to


give


better care,


generate competition


medical


marketplace,


and keep


costs


down


(CDEEIA ,


1983).


FONASa system illustrates that,


be correct to claim that


availability


while


(nanber


would


providers)


has increased,


accessibility


(financial )


to primary


care


not.


shown in


previous


sections,


cut-of-pocket


charges for FOHASA


patients


are


now


greater


in relative


total


an counts


than


they were


under


predecessor,


SEE IiA.


Evaluation Measures of


Health


Policy


There is a


need for


appropriate outcome


measures


PFO SA,


5.1.4- S.,


i S AP R8s


programs.


Little


known


about


the qualitative


aspects


municipalization


program of


5.1--Se S


clinics


or patient satisfaction


with


PONASA or S.N.S.S.


delivery


systems.


Ideally,


a health


care


bureaucracy of


the scale found


Chile might


include


department


research


evaluation.


acm oe ve t


such


operations are costly;


even


the expensive


public


health care


systems of


Vest


Germany


United


Kingdom


function


without

Chilean


these departments


government


(Etten


evaluation


(Miai


Butten,


sterio de


1983)


Salud,


1982)


the municipalization


program


3.S.S


facilities


arrived


at favorable conclusions


about


transfer


clinics








would have allowed


statistical


inference s


tc be employed).


Patient


satisfaction


uith S.u.S.S.


facilities


was


reported


very


high,


the results and


format


Ministry


Health and GallaP Chile,


Inc..


ad inistered


survey


have


not been


disclosed


(Personal


communication,


FPe rn and c


Symon,


4 July


1984;


see


lote


Despite


the constraint


that investigation,


was


widely


reported


among


local


news


media that


public


health


consume is


were


highly


satisfied.*


Government officials


their national health


argue


policy is


that


effectiveness


proven by the


drop


infant


mortality rate.


They


state,


"lcrtality


is the


most


important


indicator


quality


life


health"


(Hinisterio de Salad,


1983,


36).


On numerous occasions,


officials have claimed


that


drop


infant


mcrtality


rate froa 65.2


1973


to 23.4


1984


a direct


health


policy


outcome.


This argument


is questionable


because


infant


mortality


mortality indexes)


levels


(and


lag several


many


sorbidity


years


behind


and
public


health


program


identifiable
prophylaxis


actions unless


infectious


they


are


diseases for


readily


which


apart from
complex to


medical care


sort out


those


factors that affect infant


t is


5 mede, i
;e medical


extremely


versus


mortality;


non-medical


no major changes


either


mortality or the kinds of


programs have


been noted


ty


infant
in Chile


pe
and


of infant


child


since


health


the current


exists;








government


took power


1973;


vital


rates in


nations


like Chile,


of the demographic transition,


by non-medical


factors


(acKinlay


the la


are generally


Ic ninlay~


t phase
altered
, 1977).


Nevertheless,


Baczynski


Cy ar zo


(1982)


found


partial


support for


the role


that


gcvernsent


played


lowering

revealed


infant

that


mortality.

state-sponsored


Their a

primary


ualtivariate


care


analysis


check-ups


mothers in pre- and


post-natal


stages


was the


variable


that


best


predicted infant


survival in Chile.


But,


as has


been


documented


the


infant


mortality


literature,


infant


mortality


responds to


multitude


t he r


factors,


particularly


wage


skilled workers


and employment


the formal


labcr


conditions


sector


among


(Beha,


DOD-~


1979;


Carvalho and


tood,


1978).


Another study


public


clinics conducted by


Health revealed


independent


that


consultants


maternal-infant care


Ministry


programs


operated at


levels of


performance


that


were


"less than


efficient"


(Borgono et


al.,


1983).


The evaluation


was


based


on structural


variables such


staff


size,


materials


stock,


organization


and management


practices,


adherence to noras and


procedures.


formidable


decline


of infant mortality


levels has


some


analysts


(Haignere,


1983;


Ochoa,


1978)


to speculate


that


public


funds


continue


to be reduced


should


infant


acrtality


remain


lew.








Castillo et al.,


1982).


the one


hand,


per


capital


daily


consumption


protein was estimated


have


fallen


from


grams


1972 to 62


1978


(Bardones-Santander,


1981).


the other


hand,


the


Chilean


government


kept


distributional


levels of


infant


child


nutritional


supplements constant during


twelve


year tenure.


morbidity and


Quality_


life


Other


assess meats


Chile's


health


care


policy


emphasize non-medical factors

the Chilean population. Bedin


affecting


health


Kaeapffer


status


concluded


that


efficiency of
increase in t
areas and by


health education


medical
e number


care
of


people


the improvement in


and sanitation.


teen


liv.


helped
ing in


basic


(1982,


urban


instruction,


1004)


The claia

determinant


that infant


infant


nutrition

mortalit


programs

v decline


in Chile

has b


are


een


challenged.


Hakim and Solimano


(1978)


argue that


despite


popular


media


support


linking


infant


E ro ra ms


uith


levels of infant


death,


poor


quality


water


and stcrage


facilities


programs.


impede


Moreover,


efficiency


factors


of infant


nutrition


other than health policy


actions


(incre asaes


female


educational


levels,


water


sewage


treatment)


have


helped


lover


infant


mortality.


Clearly, the


quality of


health status,


therefore,


needs


P er








these a


major


focus of


their


study


social 1


groups


that


are


vulnerable


perils of


Chile's current


econDOic


recession.


Actually,


the


risk


where,
systeE


population,
suitable in


and


it is


a known fact that


death has


in addition,


covering


diminished


there


majority


mortality


dictator


of the


in nations


where


constantly and


a health


percent tages


levels


susceptibility to disease.


reflect


ultimate


outcome,


cease


recovery


to be


nation's state of


In fact,
that cf


they


a
health


only


dying.


(1984,


231)


That


morbidity


a more


pertinent index


health


status of a


population is noted


by the


increase


typhus


and hepatitis


(Figure


afflicted Chile at


Infectious diseases of


much earlier


period


this sort


e c ao noi c


development


(Viel,


1961).


Chile


noE


possesses


percent


all


typhoid cases in


western


Bemisphere


LColeqio


Ledico,


1983a)


but has


less


than


percent


of the


population.


Epidemiologists have


suggested


that


the high


levels


typhoid fever


number


are


of inspections


attributable


reduction


food establishments.


Curing


time


when


there


was an


increase in


typhus


hepatitis


cases


Santiago and


the rest


nation


(Figure


marked reduction in the number of


food inspections


health


officials from


197L#


to only five in


1981


was


recorded


(Medina


Trarra szaval,


1983).


Heavy flooding


1982


and


1983


to 1l


Ninao


climatic











TYPHO


210.

17 5.

140,
1 40.
1 0 5-.


--I


- --a
a


fr


196


1982


Chi


120

100

80

60

40


HEPAT


ITIS


Metropo


Sant


tan


ago


1 9 66


1 9 8 2


Figure 7:


Typhoid and Hepatitis Bates, Chile:


Scurce:
Regional,


Colegic Hedico
Santiagc.


1966-82


(G.), Ccnsejc
Algunas


Ccnsideraciones sobre la Salud en Chile.


July


1984,


34,








the


ministries of


public


works and housing intensified


their


campaign


to "make


healthy"


( sane ar)


squatte r


settlements


Greater


Santiago.


connecting homes


Although


central


this


sewage


process

system


entails

(Haignere,


1983),


raw


sewage


from


4.4 million


inhabitants


Greater


Santiago


is still


discharged


directly


intc


fapocho

primary


and Raipu

treatment.


Rivers without


Small


passing


agriculturalists


through


even


downstream


use


the contaminated effluent to


produce


about


47,0000


tons


such


vegetables as


such short-cycle


crops


lettuce,


cabbage, eel

Ambiental, 1

Environmental


ery ra

983,

Health


dishes,


44), 0

Service


and

nlj


parsley


(Servicio


two officials


of Greater


troa


Santiago


Salud

the


spend


eight


hours


weekly


field inspecting


2,128


hectares


saall


f farmers


use contaminated


water fcr


field


irrigation.


When agriculturalists


are found


using the


contaminated


water,


they


are


given


days


to cease


operation


(Personal communication,


Bagdelena


Iriondo,


June


1984)


lHeanwhile,


farmers


are


allowed


to harvest and


bring


infected


crops to


market,


and


some


crops


like


parsley


are


harvested


twice in


that


time.


Consumers are encouraged


take


preventive measures by


fairly costly


commercial


disinfecting vegetables


chemical,


with


less expensive detergent


bleach,


or soap and


water.


ianistry


Health


does








between

workers


cash subsidies and

who are infected by


latcr


productivity


hepatitis


typhus


losses


(Personal


communication,


Pernando


Symcn,


July


19814).


Faculty


School


Public


Health


University


Chile


(Personal communication,


Faculty


Ce artment


Hospital Administration,


Hay,


1984)


recognize


that


government is reluctant


purchase infected


crops


because


its


defined role


as a


subsidiary


agent


the course


social


development


(ODEPLA,


1983).


It is


likely


that


least-cost


preventive strategy


secondary


water


treatment


and crop subsidy


would enhance


public


health.


Sumary and Conclusion


formulation of


public


health


policy


task


striking


a balance


between


private and


public


health


care


financing


are


well


illustrated


the Chilean


case.


Providing affordable medical


care at


an acceptable


level


quality,


while


maintaining fiscal solvency,


a priority


many


countries.


private-public


health


care debate


Chile


has surfaced


after 60


years of


strong public


health


care


funding.


The evidence reviewed suggests


that


private sector


will not


be able


to drive costs


down


through


competition and thereby


absorb users from


public


sector.


The


probation


market-oriente d


health industry


in Chile








that


afflicted


Chile during


an earlier


period


economic development.


Redefining the


state' s


role in


health


ca re


financing


has been


accomplished by a


number of


statutory


reforms.


These


reforms


have allowed


state


relinquish


SOme


responsibility


health care sector


breaks


traditional


allegiance


with


the electorate,


political


pressure


groups,


unions in


granting


health


care


services.


Employers and aiddle-


and


upper-income consumers


have


mostly financed


the


pension


fund


schemes


(APPs),


prepaid


group


practices


(I SA PRaE )


and


have contributed


greater


out-of-pocket


payments..


guiding


ideology


behind


the changes in


health care


financing


in Chile


teen


pri vatize


part of


public


household..


This


aove seeks


throw


back the


boundaries of


political


apparatus


return some government duties to


private sector.


case


for more


out-of-pocket


fayaents


health


care


financing rests


the


grounds


that


the


government


incompetent in service


provision


traditional


welfare


state


is difficult


to manage.


Publi c


monies


tagged


health care,


it is


argued,


dau~n 1I


private


investment.7


..e -- re- a








Evidence from


the first few


ears of


restructured


health


care system


point


three


main


conclusions.


First,


the expansion


newly


developed


private


sector


falling


short


of original


estimates.


IS APBEs


have


captured


less


than one-third of


their


projected


enrollment figures.


Pension


scheme


monies


will


soon be


invested


state


venture-capital


operations


that


have


dubious


future


success.


Public health


clinics have


been


lease d


to municipal


managers


in some


Santiago municipalities,


but a


fixed ceiling


placed


on reimabrsements


daring the first


year of


program


restricts most


income areas.


aunicipalized


Second,


clinic


nore careful


middle-


evaluation


upper-


health


policy


outcomes


is needed so


that


shcrt-


long-tera


changes


in health


levels can


monitored.


was


argued


here that infant


mortality


declines


over


last


decade


are


more


likely to be


state-financed


result


health


programs.


non- medical


In gauging


factors


health


than


status,


attention was called


to mortality


measures


typhus


hepatitis


as well


as the


need


for civil


engineering


projects, against


strictly medical


cares


Lastly,


that


Chile


been


a pioneer


state-financed


health


care


will


draw


attention


to the impact of its restructured system.


Bester


nations


the


Pan


American


Health


Organization


developing nations


Africa


Asia


could


learn


much


from


aaea ~~ afs~e~i a- a


.&La rL aa-


Li.. a rt


Ans.I


EfSr* lSBrie n33 W l **U*- l Ir *~* US3 f









meeting


PAHO


annually,


has


goal


medical


lowered infant


visits


mortality


person


below


deaths


1,000


live


births


vell in


advance


year


2C00 gcal


(Chile cuaplio


todas


sus aetas


en salnd,


Noveater


1983;


finisterio de Salad,


sld..)e


Pincchet


regime


uculd


have


a model


health


care administration


worthy


eaulaticn


among


developing


nations


public sector


can


further


reduce the proportion


public


funds


without comprcaising


quality of


lit e,















CHAPTER


MEDICAL CABE


INFLATION


FOB


IN CHILE,


ECCIBGIC


1979-83:


ACCESSIEILITU


INPLICAIICC


Introduction


the

imposed


prolonged


economic


special social


crisis


costs


nation


last

s and


decade

nowhere


has

has


this stress been


more acute


than in


Providing


affordable


medical care.


medical


Rising


costs steady.


inflation


has thwarted


Some analysts


have


efforts

argued


tc bhld


that


fiscal crisis


sector


afflicts


is unable to fill


all

the


nations


void


urhe re


that

private


public


sector


funds


cannot


remain


will not


optimistic


placed


about


(C Connor,


private


1973).


sector's


Others


ability


create competition


under free-market


conditions


which


viUl


ultimately


drive medical


costs


dcwn


(Friedman


Friedman,


1980).


Little


cross- national


research has


addressed


determinants of health care


The diversity


inflation


administrative


several


financial


reasons.


structures


aakes comparison difficult..


proportion of


state


private


sector funds


allocated


medical


care


varies


a~~~~~~~I ----


I II


L~ rl


I II


-rr









care


inflation


the


practice


i ndexaing9


(lewhouse,


1S82;


Peld


stein,


1983;


Jud,


1978;


Friedm an,


1974),


annual


variations


Consumer


Price


I nde x


(CPI)


one


economies.


approach


The


Medical


assess ing


Consumer


rising


Price


costs


I ndex


national


(SCPI)


particular


purchased

providing


allows


medical

specific


health


goods


insight


research hers


services


into


tc examine


over


ccmplex


variation


time, thus

workings of


medical


market.


caveat


use


CIqCPI


s its


failure


keep


pace


vith


technological


changes


ensuing


revisions


products


Seri ceOs


Another


drawback


indexing


MCPI


fluctuations


that


they


represent


purchased


as opposed


cons


umed


medical


gcods


services.


Statistics


chapter


Institute


combines


(IZE)


data


Chile


frcm


nell


laticnal


national


surveys


carried


out


'198;3w


doing,


interrelationship


batween


purchased


ccl's


used


medical


items


better


understood.


Specifically,


sain


objectives


chapter


are


mea sure


power


medical


function


consumer'


Index


purchasing


Rages


Salaries)


To determine


related


whether


to changes


sajor


theories


Chilean


MCPI.


medical


care


inflation


I -


United


States


are


pert iiieit


dC PI








To review the


major types


health


care expenditures


in Chile

compare


primaryr

their


care,


relative


dental care,

distribution


etc.)

with


and

the


weightings


allowed


thea in the CBPI.


To discuss


trends of


health care


inflation


Chile in the


context


national


health


Policy


its effect


relative


access lb ilit


medical


care.


The first


section of


the


chapter


reviews


major


factors


that


contribute


health


care


inflation


industrialize d


developed nations


backdrop


Chilean experience.


com pari son


between


Chile


developed realm is


not as inapprcriate as


seem


first


glance.


percent


Chilean


medical


coverage through


system


various


virtually


state-


private


financed


delivery


systems.


Chile


been


pioneer


state-financed medical care


throughout


most


this


century


and only


public


recently


monies


there


the health


been a


sizeable


sector.


retrenchment


second


reason


comparing Chile with


developed


nations


paucity


research


on health care


inflation


the developing


nations


(Lee


Bills,


1983).


The second section


follows


evolution


Chilean








nation's


were


economy


described


health


as vell

Chapter


policy


impact


changes

medical


that

care


inflation


Chileans


assessed


based


means


surveys


their


costs


consumption


incurred


medical


goods


services.


Medical


Care


Inflation


the


United States
.... i ii i e )illll


rise


cost


medical


care


the


United


States


1970


and


1980s


been


well


documented.


general,


appears


that


half


increa


medical


care


half


inflation


reflects


has


the


been


combined


price


effect


hikes


great te r


other


utilization


population


growth


( lcCracken,


1984).


The


increase


cost


medical


care


moved


with


sing


demand


this


combined


effect


was


further


exacerbated


greater


ccsts


ancillary


services.


The


study


medical


care


inflation


can


approached


general


models.


first


demand-


pull


inflation,


contends


that


consumers


greater


amounts


medical


goods


than


sting


supplies.


Inflation


result


when


supplies


in Crea se,.


second


interpretation


medical


care


inflation


often


referred


to as cost-push


inflation.


this


context t


both


wages


input


prices


increase


the


outcome


high


health


care


real








unionization


that


locks


wages


into


automatic cost


living


hikes


(Feldstein,


1983,


234-237;


Sorkin,


1976).


Because hospitals


consume


largest


portion


medical


dollar


percent)


United


State


(Profitable


American


Hospitals,


18 Hayj


1985)


most


research


focused


on hospital


performance


marketplace.


Increases


Urns.


hospital


costs


can


generally


be attributed


least


three factors.


operations,


First,


wage


since


salary


hospitals


increases


are labor


must


intensive


added


cost of


medical care.


When


consumer


wages


increase,


greater


utilization of


medical


care


cften


triggered


consumer


choice or by the inducement


additional medical


procedures


physicians.


Both


aechanis as


spur


higher


medical costs


when supply cannot


respond accordingly.


Second,


medical


insurance


programs


dictate reimbursement


levels.


acspitals


try to keep their


costs


under


these


fixed levels


that


differences


between


reimtursement by


third


party


providers


and


real costs can


be absorbed by the


consumer.


Otwiouscly,


treating


patients


lover costs


than


levels established


third


parties


(e.g.,


Medicare,


Medicaid,


Blues,


commercial carriers)


Finally,


the relative


non-generalists,


signifies


high

other


supply

health


profit for


physicians,


professionals


hospital.


especially

delivering


service


affects


the total


cost.


Sanro wue r


shortages


will


a


a~~~~~ a. -r* *


L


r








physician opposition


to physician assistants,


midwives


other


personnel


been strong


impede


fair


comparison,


that


there


thus far


the substitution of


little evidence


physicians


ancillary


suggest


personnel


has


helped


to bring


down medical 1


costs


Cn a


major


scale


(Schaeitzer and


Record,


1 97 7) ,


Medical


Care Inflation


in Chile


Chile has


long


been


plagued


with high inflation


general


economy.


the nation's


dependence on a


mineral


resources


(nitrates and copper)


throughout


indeFecrndence


period


(post-1833)


left it


susceptible


"bccI


bust"


cycles


(Davis,


1963).


Since the


1950s,


chile,


like


many


its Latin


American neighbors,


been


ep per imntinytia


with


indexing


(Jud,


1978).


Indexing allows


national


economy and


certain industries


to be


monitored.


socialist

strained


government

economy wi


of Salvador


th an


Allende


annual inflation


(1970-73)


rate


faced

750


percent.


Despite efforts by


current


regime


to dampen


inflation,


its annual increase


averaged


percent


1970 and


1978


(The


Sold


Bank,


1 8O,


11).


For the


last


years,


Chilean military regime


curtailed


social


spending,


part,


lower


rate


inflation.


Ldtwaen








Health Policy Chanqe and


medical


Care


3nf ljtion


Health policy


been altered


three


significant


areas


since the outset


of the current


regime


1973.


Iirst,


there


has been a


education,


sharp reduction


housing)


which,


social spending


health


(hEalth,


sector,


translated into more


out-of-pocket


charges.


Middle-class


medical


programs such


as the


National Health


Fund


(E 103AS A)


require


relatively more


private


funds


than


predecessor program ,


SRI B N AL


which


operated


until


197S.


Second,


a major


effort


been


made


tc enroll


middle-


upper-income


practices,


election


wage


15SA PR18.


system


earners into


this


(sistemaa


private


reform


pre-paid


part


libre election)


medical


free


that


teen


central


feature of


the free-market


economy


current


regime-


& third


aspect


re ce nt


policy


changes


teeD


the transfer of


generally


public


provide care to


health clinics


indigents


(ccnsultorios)


blue-colla r


which


ucrkers


(obreros),


county


management.


As discussed


previous


chapter,


this


"municipalizaticn"


process


effort


to reduce state


bureaucracy


state-financed


care


by allowing local auth

the needs of the local


orities to


c on muflity..


provide


care


Primary


according


secondary


ca re


facilities


have


been


turned


over


f r a


national


government


to municipal management in


selected areas









only


one


of five


districts


Metropolitan


Santiago


report


regime


a profit


recent


years.


number


In brief,


measures


Military


reduce


state-


financed


medical


ca re


with


concomitant


effort


increase


out-of-pocket


pay ments


from


medical


care


consumers.


changes


portend


more


efficient


medical


care


supply


utilization.


Possible


Causes


Medical


Inflation


Chile


This


section


reviews


briefly


causes


medical


care


inflation


United


States


identified


above,


they


apply


to the


Chilean


case


at hand.


Real


income


Chile


has


declined


15 percent


aver


the


last


decade


(Cortazar,


1983).


Within


health


care


sector,.


there


been


threat


unionization


nCr


have


major


wage


concess


icns


been


granted


to public


health


vcrkers


Chile


under


current


regime.


National


Health


Service


Syste a


employed


fewer


physicians


1980


than


did


decade


earlier


(Ziedaina


Kaeapffer,


1982


T he


1979


bargaining


when


power


govern sent


physicians


changed


was


the


greatly


legal


status


Chilean


Medical


Society


(Coleqic Medico).


Iraditicoally,


association


had


legal


input


into


wages


paid


medical


personnel.


present


Binistry


Health


enacted


reduced


(s, 8, S, S,)








proportion of


budget


over


last


years.


This trend


professional earning


power can


interpreted


in very

wages a


general 1


teras as a


nd salaries.


Because


surrogate


measure of


most Chilean


physician


physicians


work


part-time


with


the S.


'- seS.


some


public-affiliated


medical


systems


generalized from


trend


Figure


earning


It will


also


power


can


be recalled


frcu


last


chapter


that


toth


absolute


number


S.B .S.S.S


personnel and


public


funds


health


sector


have


declined


over


last


decade


(Tables


4 respectively).


Therefore,


is a


valid


assumption that


physician


wages


have not


increased


sharply


so as


s;Car


cn inflation,


then


the Chilean case


contrasts


sharply


with


inflation


U. S.


medical


sector,


where


physician


salaries


was-


have


increased


by about


percent


between


1970


1980


a result


increased


insurance coverage


(Eurstein


Cromwell,


1985,


65).


A second


eleme nt


that has


been


identified in


U- St


is the


growth


new


medical


insurance


[rogramas


such


Medicaid,


Medicare and


suggested that

schemes did not


pricr

deter


"Blues"


1983 these


programs.


third-party


health care providers


f rani


teen


finance

ordering


excessive


procedures


because


their


cost-based


reimbursement


approach.


The


major


new


medical


care


S,#, S, SI








































1975 1976 1977 1978 1979 1980 1981 1982 1983


Years


Os Personnel Expenditures


As Solaries


Figure 8:


S.N.S.S. Physician and Dentist Salaries,


1975 -2E3


(A) Defined as physician and dentist salaries divided ty all
salaries and sages. Dencsinatcr cxclucdes
seniority payS.


(B) Defined


physician and dentist salari


personnel
ages, s


expenses.


enicrity pay and


divided ty all


Cenoninator include


tonus pay fcr


accepting rural assignment


Data


Scrice:


Balance Presupuestaric al 31 de ticientre,
1975-1983. Santiago: SNSS.




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