Should user fees be introduced in public hospitals?

As a low income country, Malawi continues to search for better and efficient ways of financing the health system.

The health system is beset with numerous problems but the most pervasive one is inadequate resource mobilisation which includes inequitable and inefficient usage of the existing resources.

Unfortunately, the poor and other vulnerable sections of society are the ones these shortcomings hit the hardest.

Proponents of user fees in public health facilities cite a number of rationales relating to improved equity and larger efficiency as well as cost recovery. Opponents, on the other hand, argue that the introduction of user fees would result in sustained decrease in service utilisation especially when they fail to translate into improved quality of care.

Steve Banda, a medium scale entrepreneur residing in Kaphiri, Lilongwe, feels user fees will be impoverishing and provide a financial barrier to health care and suggests introduction of efficient economic reforms to cushion the health sector.

“For starters, the fees will have a negative impact on adherence to long-term expensive treatments. But for sustainable and effective health system to be achieved, a broader package of reforms should include an increased budget to offset lost fee revenue that would otherwise have been realised through the fees. In general, user fees will result in low utilisation of public health services,” says Banda.

But Jephta Kalonga, a Balaka based technician, counter-argues that user fees would significantly improve the health care delivery and consequently service utilisation  through such things as increased salaries to health facility staff as well as increasing operational costs.

“Incidents of corruption will also be largely reduced in our hospitals and there will be efficient use of drugs and medical equipment. I am sure government would register significant and improved revenue which can be used in other equally important developmental initiatives. No one would just walk into a hospital with a simple headache and get medicine — this will be good riddance to these bad manners. But most importantly, people will be forced to seriously start saving for medical care,” states Kalonga.

Global Hope Mobilisation executive director, Caleb Thole, is not buying all this and believes it is government’s gimmick to collect more revenue and he fears that this will push people to such unreliable and unsafe sources of health care such as traditional birth attendants.

“This has failed in more advanced countries like Zambia, Burkina Faso and Ghana and, as we talk of learning from others, why are we not learning from experiences of these countries? Let’s not try something that has not worked somewhere,” says Thole.

He suggests government subsidises the health sector as it had done with iron sheets, fertiliser and cement.

“Government should find an option for this on top of increasing its tax base. There are 40 percent of Malawians who are eligible to pay tax, but only half of them do so. Let government track this  other half so that it can bail out the health system,” adds Thole.

Private health practitioner, Haswel Kamange, advises government to first examine what type of activities and inputs at facility level will be funded from revenue collected by fees, and then develop mechanisms to ensure that these activities can be sustained subsequently before rolling out user fees.

Kamange explains: “Since most studies have shown that user fees create a medical poverty trap which has negative health impacts, addressing this would require strict regulations for the private sector, reimbursing health facilities for services provided to patients exempted from paying fees due to poverty and the establishment of a social insurance mechanism.

“It must also be understood that in some countries like Uganda where user fees were abolished, incidences of catastrophic health expenditure among the poor didn’t fall, mostly because of frequent unavailability of drugs at government run hospitals and they are forced to purchase from private pharmacies or seek medical attention from private clinics.

“Finally, in order to safeguard equity there has to be need for a policy that focuses on addressing the health needs of the poor while ensuring that the poor don’t shoulder the disproportionate burden of financing the health system.”

In an interview with Weekend Nation in March, Minister of Health Jean Kalilani clarified that in the health reforms the government intends to implement, user fees would not be universal.

“You are aware that currently we have paying sections in public some hospitals. The proposal is to expand the current scope of paying services across many public health facilities. This is independent of the other proposals which aim to ensure that the proportion of Malawians making out-of-pocket health care expenditures for health remains low. For this, we are concurrently proposing to establish a health insurance scheme, starting with those in wage employment and expanding that to cover the informal sector and the rest of unemployed overtime. The paying sections will give options to Malawians who have ability to pay and wish to access paying services in public facilities. With stronger paying sections in public facilities, and a mechanism of retaining the revenue in the facilities, the revenue generated will improve and sustain quality services both in the paying and non-paying sections,” Kalilani said at the time.