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Colombia’s Law 100: from 93 to infinity?

27.08.2013 / Pharmaboardroom

colombia

President Santos appointed economist Alejandro Gaviria as the new Minister of Health and Social Protection in September 2012. Gaviria’s priority has been to create health reform that would introduce the next episode of Colombia’s payer system, following the introduction of Law 100 in 1993, which extended health coverage to nearly all of the country’s population.

This law created a mixture of private and public health insurance providers, or Entidades Promotoras de Salud (EPS). While this system brought about near universal health coverage, some argue that the EPS has evolved over the last twenty years into a business, rather than being a basic right guaranteed to all Colombians. Many accuse the EPS of corruption and mishandling finances.

Gaviria attributed the system’s financial stress to an increase in recobros, or requests, for reimbursement of drugs and treatments not included in the Plan Obligatorio de Salud (POS), which lists all medications to which Colombians are entitled. Insurance providers have struggled to reimburse patients for these treatments, and lack of resources reached a breaking point in 2009 when the Colombian government declared a Social Emergency Crisis and passed a number of tax laws in 2010 to save the system. However, this did not build a long-term solution.

Colombia’s health system operates under two schemes, contributory and subsidized. 40 percent of the Colombian population holds formal employment and receives health insurance through the contributory scheme that is paid for by both employees and employers, granting access to private hospitals. The remaining 60 percent of the population, who do not hold formal employment, are subsidized by the public health system, which is generally of lesser quality.

One of the biggest changes Gaviria has proposed is the replacement of the EPS with a single payer publicly funded “Fondo Unico.” The contributory and subsidized systems were combined in 2012, and both would operate under the Fondo Unico. “With this new fund, we need to have the best control of resources possible, which will reestablish the legitimacy of the system. It can be seen as a ‘fund of investment’,” says Gaviria. Another change could replace the POS with “Mi Plan,” which would remove many financially crippling items from the POS such as cosmetic and aesthetic treatments.

“Law 100 allowed some functions of the state to be delegated to the private sector,” says Gaviria. “This ruling essentially created a virtual fund. Twenty years later, one can see that it is not sustainable anymore. We realized that the state has to take on some functions.”

According to Rafael Romero Piñeros, President of the Seventh Commission of the Chamber of Representatives, which addresses a number of social issues including health, a purely publicly funded program would allow resources to be directly reinvested into services such as primary care and disease prevention. The system had previously essentially existed as a triangle: “the patient was paying for a service and then charging it back to the State,” comments Romero. “That intermediate step will cease to exist, and therefore corruption will disappear. The success of the reforms will depend on the strength of the government and the collaboration of many different actors.”

To read more articles and interviews about Colombia, and to download the latest report on the country, click here. 

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