Like open-heart surgery, healthcare reform has been both delicate and lengthy since Azerbaijan achieved independence in 1991. While the organization of the system remains largely similar to its Soviet legacy, President Ilham Aliyev and his government are performing a number a specialized operations for change. Finance reform has dominated the agenda alongside the introduction of mandatory insurance and investment in buildings and equipment. In addition, the government has pressed for increased regulation, tighter controls on the training of medical personnel, and is encouraging the fledgling private sector.
In absolute terms, it is estimated that public health expenditure has grown rapidly from approximately $6 per capita in 2000 to over $80 projected in 2011. The government has budgeted AZN546.1 million for public health in 2011. Of this, AZN88.8 million is for polyclinic and outpatient departments, AZN273 million has been allocated for hospitals, and AZN200 million for other services in the field of public health. In terms of research, the state budget has allocated AZN3.4 million. However, the country’s GDP showed the same pattern of growth during this period, so budgetary allocations for health as a share of GDP have changed little, remaining at approximately 1%. The first real increase in state funding for health was seen in 2005, following an increase in state oil revenues. This enabled the new leadership of the Ministry of Health to introduce a significant number of state health programs starting from
2006, which represented a new mechanism for directing funds to priority areas in health care. This funding was aimed at the 2005 Health Sector Reform Project, which is operated by the Ministry of Health in collaboration with USAID, UNICEF, WHO, and the World Bank, and aims to “improve overall health system stewardship and financing, and enhance equitable access to, and technical and perceived quality of essential healthcare services, in the selected districts in a fiscally responsible and sustainable manner with a view to improving health outcomes.”
Further structural reforms have happened incrementally and mostly concern the financing of the system. In 2008, the Concept on Health Financing and Introduction of Mandatory Health Insurance was drafted by the Ministry of Health and approved by the President. In 2009, the cabinet approved the Action Plan to Introduce Health Financing Reforms. Success has been seen in specialized areas, especially in the development of national clinical guidelines, the development of family medicine as a specialty, the strengthening of pharmaceutical regulation, and the development of a system for rational drug use. In addition, the government has embarked on a renovation and rebuilding project across the country to bring healthcare facilities up to scratch. “In the past five years, more than 400 new medical establishments have been constructed or renovated. Our priority is to reconstruct the dilapidated system from the inside out,” Minister of Health, Ogtay Shiraliyev, told TBY.
The primary aim of the reconstruction from the inside is to completely overhaul the way the system is financed as the government has not yet fully shaken off the Soviet practice of highly centralized planning of resources and personnel, primarily public ownership of health facilities, and fund allocation based on inputs. In this vein, the government tabled “The Concept for Health Financing Reforms and Introduction of Mandatory Health Insurance” in 2008. The reform grants greater autonomy to regional management to ensure a more efficient use of funds. This includes contracting as the basis for new payment mechanisms, such as per capita payments in primary care, and case-based payments for hospitals will also be introduced. These reforms will underpin the proposed introduction of mandatory health insurance.
While the system is run primarily under the auspices of the Ministry of Health, provision is divided up between regional urban and rural areas. In cities and district centers, primary care is delivered at general-purpose medical centers, with specialized centers for antenatal and reproductive care services. In rural areas, primary care is provided through outpatient clinics (selskaya vrachetnaya ambulatoriga-SVA), feldsher-midwife points (FAP), and small village hospital outpatient departments (selskaya uchastkovaya bolnitsa-SUB). The government is trying to institutionalize the concept and practice of family care, with the emphasis on having a family doctor. The family medical model is first being introduced in rural areas, and after a series of pilot projects will spread to urban centers as laid out in the state “Program for Poverty Reduction and Sustainable Development 2011-2015”. Inpatient care is provided by city hospitals that provide a wide range of specialist services. In each rural district, inpatient care is provided by the network of SUBs and a larger central district hospital that acts as a referral center for the entire district to provide a broad range of secondary care services. There is also a network of specialized clinics in every region, which are parts of vertically integrated national systems typically led by tertiary-level specialized scientific research institutes, all of which are located in Baku.
As per the 2008 action plan on financial reform, the Ministry of Health has developed optimization plans for each district, which envisage the closure of most SUBs, transforming them into primary care centers. Many specialized clinics will also be merged with central district hospitals to form a single multi-profile secondary inpatient facility in each district in order to achieve greater efficiency in resource allocation. The current system is in need of doing more to encourage efficiency, with hospitals receiving payment whether their beds are full or not.
THE PRIVATE SECTOR
The government is keen to encourage development within the private sector. Under the Health Sector Reform Project, the government has released for tender a number of new hospitals and health centers across the country. In addition, it is possible for government hospitals to be run by private practice. According to Kutay Köker, Director of the Turkish American Medical Center in Baku, Azerbaijan has more than 300 private clinics and 10 to 12 private hospitals. Ministry hospitals are included in the figure because while they are owned by the ministries, they are run as private hospitals to relieve pressure on the government, and are closely monitored. Köker told TBY, “The Minister of Health sometimes visits clinics without telling anyone that he is the minister, noting what is not acceptable and then discussing the challenges with the right people.” All pharmacies and dental practices, however, are private.
There has been a considerable growth in private service providers that cater for those who have profited from the recent oil boom with a wide range of services provided in private hospitals and clinics, which are mainly located in Baku. Oncology services can only be provided in state hospitals, but otherwise private providers are entitled to include any other services and make their decisions on the basis of the relative profitability of different fields. Private providers also contract with multinational companies operating in Azerbaijan for occupational health services and to provide services for workers with private health insurance.
Another policy change aimed at ensuring the provision of health services to the population, at least those able to afford to pay out of pocket, was the creation of more favorable conditions for private medical practice, which was in line with the overall transition from central planning to the market. Initially, the private health sector was regulated mainly through Ministry of Health executive orders. The significant growth of the private sector by the late 1990s necessitated the creation of a stronger legislative base and the Law on Private Medical Practice was adopted in 2000.
Another key area of reform is medical education. The reform of undergraduate and postgraduate medical education has been supported since 2010 and is fully underway under the leadership of the Ministry of Health and the State Medical University. The standardized testing and certification process of 30,000 physicians and nurses began in January 2011 and will continue into 2012. In addition, residency programs for medical graduates wishing for further specialization have been introduced, following the adoption of the new Law on Education by the National Assembly in July 2009. Undergraduate medical education will also undergo major changes including the closure of pediatric departments, which will lead to a uniform training program for all medical graduates. The specialization in pediatrics will be available only through the relevant residency program. In parallel with this, the Azerbaijan Medical University plans to revise its training curricula to bring them in line with modern knowledge in medicine and related fields. The university also has plans to move the majority of clinical chairs to its own hospitals. Altogether, the Azerbaijan Medical University plans to have four clinics (oncological, dental, surgical, and therapeutic), two of which are under construction. Also, the strengthening of postgraduate education for nurses is planned with the support from GAVI through the Health System Strengthening Grant.
© The Business Year