Fighting Corruption in Health Care Services
by David Hayhurst

Governments in CEE countries and the former Soviet Union meet with resistance on many fronts when tackling corruption within their health care systems. Even when state authorities possess the will and resources needed to take on the various, and often endemic, types of corruption, they confront a common, major obstacle: the attitudes of the public and of many politicians are as difficult to change as those of health care professionals.

In-depth, OECD-funded studies carried out in 2002 that dealt specifically with corruption in the health care system in Latvia and Lithuania shed light on problems common to some extent in all the post-Soviet states. While the two Baltic nations are far from being the worst off in the region in terms of either systemic fraud or budgetary constraints, the reports describe how hospital cleaning staffs are routinely paid better than nurses, while factory workers can earn more than even some senior doctors. Meanwhile, throughout the CEE countries and the former Soviet Union poorly implemented systemic reforms, often explosive increases in operational costs, and decentralization of accountability and decisionmaking capacities have unwittingly helped to promulgate environments where corruption can thrive.

A major challenge to governments wishing to reduce corruption is that what international bodies invariably view as improper conduct is not frowned upon nearly as much by the public at large. The most common form of "unethical" conduct—the acceptance of so-called out-of-pocket payments by patients to doctors and nurses—is still widely tolerated by the public. This is particularly true among older people, who often tend to view such informal charges both as expressions of gratitude and as the surest way of assuring that they receive the best medicines and treatment. A 1998 World Bank survey on corruption in Latvia found that despite households’ direct experience with corruption in the health sector, they gave health-related organizations relatively high marks in terms of honesty and integrity, on average well above what they gave the mass media or local NGOs.

Indeed, it is difficult to see how governments that cannot afford to pay the meager salaries of medical professionals for months on end can expect them even to survive by honest means. Some governments have allegedly given up on trying to curb the practice to the point of using estimates of out-of-pocket payments to determine physicians’ wages. Recent estimates for Azerbaijan, Georgia, and Moldova, where public financing for any forms of social services have all but collapsed, indicate that such payments now account for 50 to 80 percent of total national health revenues.

The introduction of mainly market-based reforms in health care systems has been fraught with danger for governments worldwide. This is perhaps doubly so in the former socialist states, where unfettered and free access to health care was seen by all as a citizen’s birthright. Medical professionals in these countries have not been overly accepting of their governments’ usually scattershot approaches toward installing such foreign concepts as performance benchmarks and peer reviews for their managerial prowess. Much of the so-called private care increasingly being implemented to help ease the insufferable burden on state budgets is currently either financed partly by government or uses public infrastructure and equipment to treat private patients. Clearly such policies can leave systems wide open to abuse.

According to a comprehensive 2002 study ("Corruption as a Challenge to Effective Regulation of the Health Care Systems," by Tim Ensor et al published by the Open University Press, Buckingham, United Kingdom): "Staff in public medical institutions have the opportunity to deliver private care using public resources. This includes the use of equipment, supplies and, perhaps most importantly, time. Sometimes known as creeping privatization or privatizations from within…services offered to patients may include simple additions to the treatment already provided as part of the official state package of care. Alternatively, a doctor may provide treatment entirely on a private basis during the time he should be spending on public duties and/or using public supplies and equipment. Another possibility is for a public doctor who also has a private practice to spend less time than contracted for in public facilities to extend the amount of time in private practice."

Such workaday abuses obviously stem in part from the failure of alternative methods of budget financing to supplement massive jumps in expenditures adequately. In particular, the introduction of payroll-based mandatory health insurance funds is, in the view of many experts, being regarded as a panacea by governments unwilling to admit that extra funds have to come from somewhere if public systems are going to function even remotely in accordance with official guidelines.

In such environments, it is not difficult to see how senior doctors and hospital managers can be tempted to take illicit measures to make ends meet. Most, after all, received little or no training as managers before being required to run hospitals in a suddenly semi-autonomous environment. Under the Soviet model, successful hospitals were seen as those with the most occupied beds. This mentality has often died hard: hospital-based concerns still completely dominate health care policymaking rationales in the CEE countries. A 2001 study describing the abundance of changes still taking place in the Hungarian hospital sector found that patients were more likely to be willing to pay gratuities the longer they stayed in hospitals, and particularly just before surgery. This has led to a rise in the number of hospital inpatients—completely the opposite of the expressed desires of almost all national and regional politicians—with a concomitant rise in what are described as interventionist operations. ("Coping with Environmental Change: The Hospital Perspective in Hungary," Eurohealth, Dublin, Ireland, Vol. 7, No. 3, 2001).

Nevertheless, the anticorruption battle has had some success stories. In recent years the Czech government has managed quite successfully to circumvent some of the often well-entrenched vested interests that have stymied effective reforms in many of its regional neighbors. Most Czech hospitals are now owned and governed under a public-private mix involving the national government, district and regional authorities, and private for-profit and not-for-profit bodies. The country is almost unique in the region in that the number of physicians has declined and their earnings have exceeded the national wage growth average in recent years. Partially as a result, out-of-pocket payments are the exception. Poland has also seen health care professionals in general receiving higher wages than the national average.

Perversely, however, many health care workers in Poland and elsewhere have voiced their concern that joining the EU will lead to at least an initial drop in wages, while intensifying what has already been a dramatic brain drain of the youngest and often most gifted professionals. (CEE countries’ health care systems, perhaps somewhat surprisingly, are not specifically part of the EU’s accession criteria.) With the sudden heavy inflow of capital that EU membership will in all likelihood bring to the health care networks overall, whether new and equally insidious forms of both blatant and tacit corruption will emerge within CEE countries’ and the former Soviet Union’s medical networks remains to be seen.

The author is a freelance journalist in Budapest, Hungary. His email address is dthayhurst@yahoo.com.