Privatization of health care in three Latin American social security systems

This paper analyzes three such reform programs, all of which involve privatization, though to varying degrees. The programs are: (1) El Salvador"s 1991 introduction of the option to select a qualifying private provider for outpatient care who is paid a fixed rate per consultation on a fee-for-service basis; (2) Peru"s Minor Surgery and Decentralized Ambulatory Care Programs, introduced in 1991 and 1992 respectively, which allow social security beneficiaries to choose a qualifying private provider who is reimbursed a fixed fee for services rendered (proposed far-reaching organizational reforms of Peru"s entire health system are also discussed); and (3) Nicaragua"s complete contracting out of services, implemented in May 1994, whereby social security beneficiaries enroll in a qualifying provider organization on an annual basis and social security pays that organization a fixed annual fee for all health care for the enrollee. Lessons emerging for the design and implementation of social security reforms include the following. (1) Conduct a stakeholders" analysis to identify the size and importance of the parties that will be involved in or affected by the reform. (2) Initially focus on a relatively small problem with high visibility and/or probability of expeditious success. Time-limited efforts may be of strategic importance. (3) Extend reforms gradually. (4) Proceed slowly and search for common ground, so as not to alarm the chief actors and so as to minimize politicization of the process. (5) Institutionalize reforms as soon as possible. (6) Make participation of both patients and physicians voluntary. Includes references.