José Alarcón
Partner and Lead of Health Services
PwC
/
View from the Top

Strikes and Budget Cuts Could Prove Beneficial

Tue, 11/01/2016 - 14:10

Q: Considering the dual budget cuts in the healthcare sector, what infrastructure challenges are ahead?

A: It can be viewed in an optimistic or pessimistic way. Pessimistically, it can be said that healthcare is cut and it is frozen, in which case the only way to move forward is with pressure from organized society, the private sector or even international organizations. Optimistically, considering the intelligence of leaders such as Mikel Arriola at IMSS and Minister of Health José Narro, we may now be more united and integrated. In an integrated view, the pressure caused by the budget cuts can be used as an opportunity to change things for the better, meaning becoming more efficient and creating more appropriate infrastructure. If politicians and leaders in the public sector share this view these cuts can be used as leverage for improvement and new models can be introduced using public-private cooperation, such as pay for results, risk-sharing agreements, development of appropriate infrastructure and the development of strategic demand linked to consolidated purchases.

Q: Are doctors in pharmacies an appropriate solution to delayed services in public hospitals?

A: I think it has been a good alternative for society but by taking that alternative the population is not receiving access to public healthcare as is their right. It also relieves pressure on hospitals in terms of demand and mitigates the stress on the current infrastructure that is in need of development. It is positive as long as the public sector sees it as a sign for improvement. As for private spending, there is too much out of pocket. The public sector does not have the resources to comply with all demands and an alternative is to shift to an innovative public-private partnership. This would allow the development of infrastructure financed by the private sector to meet public sector needs, as long as the public sector assumes the majority of the risk.

Q: How do you expect Mexico’s healthcare changes to unfold?

A: In the near future, I do not think there will be anything revolutionary, just evolutionary actions to maintain the status quo and maybe some relevant steps focused on efficiency on the public sector side. In the private sector, I see a more united voice pushing to have it seen as a competitiveness tool for the government and the country as a whole, and hopefully this will drive big reform in the early years of the next administration.

After the next eight years, I think a reform will be implemented and the focus will shift to trying to stabilize a united national health system until 2030. Most of this will be employed through PPPs since resources will be scarce at both sides of the spectrum. Afterward by 2034, a better healthcare system may be a reality with some room for improvement. Another way to view it is in terms of supply and demand. To avoid a crisis, supply must be increased through efficiency and demand must be lowered with the help of private sector innovations. We must get the reform right so the gap between supply and demand does not become a predicament.