Bitter cure

Rath knows health care’s problems as no predecessor has, and he’s taking action. But will it work?


By Martin J. Stránský

November 30, 2005

The most widely covered new “enfant terrible” of Czech politics is Dr. David Rath, the new health minister. Rath, who throughout his medical career always flirted with politics and enjoyed the limelight, is no stranger to controversy.

Doctors have long criticized Rath for his alleged usurpation of power, the way he got himself elected president of the Czech Medical Chamber (ÄLK), and for nontransparent financing at the ÄLK in areas such as advertising revenue and sponsorship of the chamber’s magazine. Rath and the governing board of the ÄLK also extended their terms of leadership automatically twice, without due process. Most physicians in the country have long given up on the ÄLK as being their representative body, and its mandatory membership is being challenged in court.

When Prime Minister Jiří Paroubek decided to replace Milada Emmerová, the most recent in a long line of incompetent health ministers, with Rath, President Václav Klaus objected â on the legitimate grounds that Rath could not simultaneously be minister and ÄLK president. Rath retorted that as soon as Klaus would sign the appointment he would resign.

Suddenly, the two biggest egos of the Czech political scene were engaged in a face-off.

The press filled its pages with analysis and comment, unfortunately limited to the tabloid level of intellect. Then Paroubek, who has stood up effectively to Klaus’ unjustified impertinence in the past, fueled the fire by naming Rath first deputy of the ministry, giving him control of the empty ministry chair even before his appointment was confirmed.

A healthcare mess

Rath has stepped from the frying pan into the fire. In the Czech Republic, the single biggest source of financial woe is the healthcare system. It is fragmented into independent entities and each is self-centered and isolated.

All this began in the early 1990s, when capitalist forces were let loose into a socialized system. Doctors and hospitals were faced with enticing new technologies and treatments, but couldn’t afford them. Pharmaceutical firms flooded the market with new and expensive drugs that were often no better than those made here. Today, drug expenses continue to grow exponentially, accounting for the largest portion of so-called uncontrollable costs.

The state also created multiple insurance companies to reimburse healthcare providers and keep costs down via competition. A point system was created, wherein procedures and treatments were reimbursed based not on actual cost but on artificial criteria.

But insurance companies remained free to pressure healthcare providers for profit and market share. This forced providers to adopt a survival attitude, cajoling money from companies any way they could.

The majority of insurance contracts remained with the only pre-1989 insurer, Universal Health Insurer (VZP), a massive bureaucratic fossil that until weeks ago was virtually free of control or regulation. VZP and other insurers still refuse to divulge internal costs or financial data, despite being set up by and on behalf of taxpayers.

Hospitals are still paid based on the number of beds and in-patient days, encouraging patients to linger in bed and doctors to be lax about recovery times. No incentives for savings exist.

The system rewards bad behavior. From the doctor’s union to hospitals, raises and increases are negotiated through pressure tactics, not based on monies saved.

There is still no definition of “guaranteed standard of care” that the state should provide. And no one has defined exactly where the point of care should be, i.e., how many state hospitals and clinics, of what type and where. Faced with increasing losses, many hospitals are privatizing.

Instead of creating a national plan of health care with a map of points of care based on demographic need, the debate is mired on whether hospitals can privatize in the first place. With no one clearly framing the issues, Parliament is blind and headless, viewing the entire healthcare scenario with an eye toward not losing votes by ruffling patient/voter feathers.

A bad mindset

There are plenty of feathers to ruffle. Czechs lead Europe in doctor visits per year with 17, mostly to get prescriptions for medication readily available over the counter in other countries, or to get refills, or to doctor-shop.

All because sick time is generously reimbursed. Many doctors will accept cash to write prescriptions. Meanwhile, big drug companies and pharmacies keep control over them by influencing the limited pool of prescribers, not by reaching out to consumers.

Like many Europeans, most Czechs believe a socialist work ethic is compatible with capitalist rewards. They want state care from cradle to grave. Meanwhile, they smoke merrily away, leading Europe in lung cancer deaths. I myself attended two health ministers who were chain smokers; doctors with cigarette packs in their surgical scrubs are commonplace in all hospitals.

Preventative care is still shockingly behind the times: Mammography and screening for cervical cancer are reimbursable only in certain centers.

The solutions

As regards funding, the country has enough. This year’s budget, above the European average, of 180 billion Kč (about $7 billion, or $700 per citizen) came up about 1.2 billion Kč short of actual expenditures. No further taxes, patient co-payments, etc. are needed. Instead, savings and improvements can be achieved easily.

First, define the minimum standard of care. State-sponsored points of care must be mapped. Since healthcare-wage deductions are mandatory, supporting a healthy private sector will benefit the state most: More monies will remain for fewer patients, raising quality.

With state-sponsored health care, multiple insurance companies are nonsense. A single administrative agency directly under the Health Ministry should manage and control all healthcare expenditures. The remaining insurers should be competitive companies, offering above-standard plans (i.e., private hospital rooms, full prescription coverage, etc.) and negotiating with providers and clients individually.

The state should not offer “above-standard” care. The point system must go. Crowns should be billed and collected as crowns.

A coherent drug reimbursement policy is needed to limit spending. Only the cheapest drug in a given category should be fully reimbursed, the rest not at all.

Back to Rath

Rath is the first health minister since 1990 who understands the solutions. As soon as he took over the ministry, he made changes. Despite the protests of Klaus, Rath justifiably put VZP under forced administration.

He is limiting hospital expenditures to 98 percent of last years’, with strict control. He created a list of expensive medications that would not be reimbursed, and a strategy for enforcing the prescription of the generics.

The bad news is Rath embodies the classic Czech politician: ever ready to start saber jabbing, be it to prove he is a man of action or in reaction to any criticism. What’s needed is someone who can calmly and clearly articulate the problems of the system and their solutions, while presenting a positive scenario for all sides.

In a new democracy, with a nervous public that does not believe in its politicians or institutions, results are dependent on the methods used. In the span of 16 years, 11 health ministers have failed. We shall now see what the 12th will do.

– The author is a physician, director of Policlinic at Národní, and assistant clinical professor at Yale School of Medicine.


The Prague Post30.11.2005

My priority is that patients recieve
and have access to the best care possible.