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The Impacts of Health Sector Reform on the Efficiency and Productivity of Public and Private Hospitals in Turkey. Osman Zaim and Müge Diler Bilkent University Department of Economics. Social Security and Health Care (Pre-Reform).
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The Impacts of Health Sector Reform on the Efficiency and Productivity of Public and Private Hospitals in Turkey Osman Zaim and Müge Diler Bilkent University Department of Economics
Social Security and Health Care (Pre-Reform) • A rather dispersed and fragmented social security and health delivery system Social Security Association- SSA(1946): operates both as an insurer and a health care provider for itsmembers (privatesector and blue-collar public sector workers).Provides health services through its own hospitals. Pension Fund for Civil Servants(1950) The members and their dependents are provided basic health care services at MoH(i.e. public) hospitals. Social Insurance Agency of Merchants, Artisans and the Self-employed(1971). Purchases health delivery services from SSA. Green-Card (1992) For the extremely needy
Unsustainable Deficits • The broadened coverage of the social security system has been achieved at the expense of ever growing deficits since the early 1990s
PressureGroups • IMF • World Bank • EU : Association Council Decision 3/80 requires the application of social securityschemes of the Member States of the European Communities to Turkishworkers and members of their families
RESPONSE: A Social Security Reform consisting of 4 main components complementing each other • The first component is the setting up of a single retirement insurance regime that includes short and long term insurance branches other than health insurance. • The second is the creation of a General Health Insurance towards financing the provision of a high quality health service for all population, which is fair, equal, protective and curative. • The third is the gathering of social benefits and services that are currently being carried out in a scattered manner and establishment of a system based on objective benefit criteria and which is accessible by all groups who are in need. • The fourth component is the creation of a new institutional structure,which will ensure the provision of above mentioned services in a modern and efficient manner
Steps and Measures of Reform • April 2003: as a result of the protocol signed between MoH and the Ministry of Finance, civil servants are allowed to benefit from private health institutions. • July 2003: MoH, Ministry of Labor and Social Security and the Ministry of Finance signed a collective utilization protocol that enabled the members of Soc. Ins. Agency of Tradesman, Pension fund of Civil Cervants, active public employees and green card holders to benefit from SSA’s hospitals, and that enabled members of SSA to benefit from MoH (public) hospitals. The execution date of the protocol throughout Turkey was Jan 2004. • Feb 2005: with law no 5502, ownership of all SSA’s hospitals are transferred to the MoH. Hence, with this final step unification process of the reform has been completed. • All security institutions are united under the name of Social Security Institution (SSI), 2005 • Currently all patients are covered by SSI and all patients could benefit from either MoH (public) hospitals, YOK (university hospitals) or private hospitals, operating under the administration of MoH
Likely effects of reform on hospital performance • Significant efficiency differentials among hospitals during the pre-reform must have been reduced after reform leading to a more uniform health service delivery. (Reduced efficiency in hospitals owned by SSA and increased efficiency in hospitals owned by MoH, Private Hospitals and University Hospitals as rationing of patients with respect to membership is alleviated) • Significant after reform productivity increase in the health service delivery to meet the health needs of the increased patients with health insurance coverage (new-entrants). • Significant scale adjustments in relatively smaller private and university hospitals as they have started to serve members of SSA after 2003. • Some administrative effect after 2005 as ownership of hospitals changed hands.
Model: Bootstrap DEA-Bootstrap Malmquist • An output orientated variable returns to scale (VRS) DEA model is employed
Farrell Measure The efficient boundary of the output correspondence set
Data • Original data set contains 1150 hospitals (public, private, SSA, and university). Source is MoH. • We have excluded those that are specializedin just one field of medicine such as mother and child health care, physiotherapy and rehabilitation, mental disorders, eye care, oncology, cardiology, urgent care and traumatology. • Some had missing data • A careful outlier analysis, Wilson (1993) • Finally, with the elimination of outliers in the data, a balanced panel of 441 hospitals (281 MoH, 85 SSA, 45 university and 30 private hospitals) in the pre-reform period and 415 hospitals (338 MoH, 47 university and 30 private hospitals) in the post-reform period is obtained
Variables Output variables • outpatient visits, • number of small, medium and big surgeries separately, • number of births • total inpatient days Input variables • number of beds • number of specialists • number of practitioners
Concluding Remarks • All the expected positive effects of reform seem to have been realized. Slightly reduced efficiency in formerly SSA owned hospitals have been more than offset by increased efficiency in MoH hospitals as well as in private hospitals and university hospitals, leading to a more accessible and higher quality service provision which also reflects itself in patients’ satisfaction surveys (less waiting time by switching from queuing regime to an appointment regime) • Significant scale adjustments in small scale private and university hospitals seem to have taken place • Significant after reform productivity increase in the health service delivery have been instrumental in meeting the health needs of the increased patients with health insurance coverage (new-entrants).
