Changes in the Health Care System of VN in Response to the Emerging Market Economy

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Changes in the Health Care System of Vietnam in Response to the Emerging Market EconomyAuthor(s): Judith L. Ladinsky, Hoang Thuy Nguyen, Nancy D. VolkSource: Journal of Public Health Policy, Vol. 21, No. 1, (2000), pp. 82-98Published by: Palgrave Macmillan JournalsStable URL: http://www.jstor.org/stable/3343475Accessed: 12/08/2008 10:58

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Changes in the Health Care System of Vietnam in Response to the Emerging Market Economy

JUDITH L. LADINSKY, HOANG THUY NGUYEN, and NANCY D. VOLK

.^( '^X HE fight for health for millions of people in devel- oping nations is a challenge to their initiative, forti-

T I k ̂tude, and above all, ability to organize human and @ I , material resources. The governments of most third

world countries articulate priorities that include |.e2.ag~e.L providing basic health care for the majority of

the people, eradicating infectious and parasitic diseases, and promot- ing family planning. However, because of differing political and economic climates, countries vary in their degree of success in develop- ing appropriate means to those ends. Vietnam provides one example of these problems. Some of the factors which influence the sustainability of the health sector in Vietnam will be discussed in this paper, as well as an analysis of issues arising during this time of transition to a market economy. We hope that these issues might also be relevant to other low-income countries with similar structural adjustment problems.

At the onset it is necessary to note that the changes heralded by the policy of doi moi (meaning renewal), begun in I986 and accelerated in I989, pushed the country from a centralized socialist to a market economy. Doi moi might be characterized by reform in three major areas of the economy. i) In macro-development strategies, it initiated a U-turn from inward orientation (self-sufficiency, auto-centered development) to incorporation into global markets. z) The government undertook a series of financial reforms which parallel those promoted by the World Bank under the title of "structural adjustment," including devaluation and restrictive control of the currency, cuts in

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LADINSKY ET AL. * HEALTH CARE IN VIETNAM

public spending, reduction of subsidies to both state industries and consumer goods, and public revenue creation through fees for social and other public services. 3) It allowed privatization in agriculture, trade, small and medium size industrial enterprises, and social services including education and health. These measures include cutting government subsidies for social services and basic consumer goods, as well as other measures likely to increase the already high unem- ployment rate. It was foreseen that this might pose a threat to equity. Population groups previously sheltered by local solidarity or the state safety net, who do not have marketable assets or access to modern centers, are already beginning to suffer social deprivation. One result is that the health care system is no longer sustainable in its past form; a major reason is that it is not affordable. The problem facing the country at this time is how to finance an economically viable system of health care in a country of few resources, while at the same time remaining true to the principle of equity.

In this situation there are two questions concerning sustainability. The first is what factors enable the existing health care system to be sustained in this period of transition to prevent its breaking up completely. Three factors are critical to providing continuity in the transition period. The first is the existence of an extensive health infrastructure including facilities and staff. The second is the existence of a trained health cadre with some very qualified people in the hospitals and in the specialized research institutes. The third is the commitment of the leadership to preserving the positive features of the former centralized socialist system, including seeking ways of providing health services to the poorer members of society.

The second question is what issues must be confronted in order to enable a newly emerging system to be sustained. This can be exam- ined by analyzing the following issues: i) The system of financial support for the health sector and the distribution of power and control between the national level and the provincial, district and commune levels; z) The problem of quality of care; 3) Training and utilization of health manpower; 4) The role of the pharmaceutical industry in the financing of the health system and the improvement of health care; 5) The problems surrounding weak information systems and poor quality of planning data; 6) The role of the "community/bene- ficiaries" in the restructuring of the health services; and 7) The in- fluences of external donor aid.

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In order to understand the importance of each of these issues, in terms of their influence on the transition economy of Vietnam today, it is important to trace current economic and health policy develop- ments. Starting in I985 two major economic changes were made in the centralized, subsidized system.The first was the opening of the State-subsidized sector to market forces. The second was the approval given to the development of a private sector. By I989 legislation was passed to enable public health clinics to charge fees and to allow private clinics and private pharmacies. It also allowed physicians, who had all previously worked for the State, to engage in private practice. These trends had direct implications for the health sector.

STRUCTURE OF HEALTH SERVICES

The health care system is hierarchically structured and bureaucrati- cally organized (figure i). There are 5 municipalities and 61 provinces in Vietnam. There are 8 medical schools under the Ministry of Health, which also oversees education of other health workers, pharmaceuticals, health policy, and coordination of the National Health Budget. Hanoi and Ho Chi Minh City host first-class facilities in national specialty Institutes.

Provincial hospitals, to be found in the provincial capitals, provide all the major medical specialties. Each province contains io to zo dis- tricts with a population of Ioo,ooo to 200,000. In each province there is a provincial health service department funded by the central government. It is responsible for manufacturing pharmaceuticals and coordination of treatment and preventive actions in areas such as malaria, trachoma, tuberculosis, AIDS, leprosy, and venereal and other diseases. The provincial hospital provides referral and labora- tory services. It is a training center for nurses, midwives, and assistant doctors.

At the district hospital level the four major specialties (surgery, gynecology and obstetrics, internal medicine, and pediatrics) are rep- resented. A district hospital has Ioo to zoo beds. Each district has 16 to 25 communes or villages.

In the village health stations there may be one medical doctor, but most are staffed by assistant doctors, a midwife, a pharmacist, a traditional physician, and nurses. It provides simple outpatient care, minor surgery, trauma care, supervision of normal deliveries, and supervision of the village health workers working at the hamlet level.


FIGURE I

Vietnam's Health Structure

Ministry of Health

National Specialty

Institutions

Hospitals

Hospitals

Drugs Health Polic]

Province I I

Health & Nursing & Education Allied

Hospitals

District I I

Prevention Referrals from Centers Communes

Education of Health

Professions

Materia Medica

Pharmacies Pharmacies

Commune/Village Health Care I

Primary Hamlet-Village Care-OB Health Workers

Each village has 8 to io hamlets or production units, each with 800 to Iooo inhabitants. In each hamlet a member is selected to be trained as a village health worker.

In a village a primary nurse paid by the commune provides diagnosis and treatment, coordinates home care, and provides follow-up for infectious diseases, mental health and postpartum patients. The primary nurse also supervises four to five Red Cross workers. The Vietnamese Red Cross is unlike the international Red Cross: it is a national voluntary organization with a heirarchical structure. Red Cross workers are active in case finding, health information, provision of family planning education, giving simple first aid, home care for simple diseases, and the organization of funerals. They serve as an additional point of entry to the health care system.

In addition to this overall structure, there are 14 vertical programs for tuberculosis, leprosy, malaria, family planning, dengue fever,

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Expanded Program of Immunization (EPI), Control of Diarrheal Dis- ease (CDD), Acute Respiratory Infection (ARI), etc., each affiliated with a central institution such as the Ministry of Health, UNICEF or WHO, but all working through the same healthcare structure. How- ever, there is no formal integration or coordination of these vertical programs. The same primary nurse and Red Cross volunteers are

supposed to be involved in all these programs and report to each individually when their time and energy is limited; these programs are often in competition with each other and integration is lacking.

FUNDING OF HEALTH SERVICES

The previous economy essentially paid for all health care. The Coun- cil of Ministers gave funds to the Ministry of Finance which made allocations to the Ministry of Health for support at the central level, for a number of specialty hospitals, and for specialized training and research institutions including the medical schools and specialty Insti- tutes. The Ministry of Finance also gave money for staff directly to Provincial and District Health Services. Through the Ministry of Health a basic allocation was earmarked at all levels, based on the number of beds per unit. Allocations could be increased through locally raised revenues. At the commune level, the State in a few cases

paid for two or three health workers, but most of the allocations were made by the local People's Committee (local government office), and most health workers were paid in work points (rice, commodities) rather than money.

Allocations for health care from the provincial level on down paid for the running of the Provincial Health Services (the administrative unit), and for the curative and preventive services. Each health unit was allocated funds and staff salaries based on the number of beds, according to a central plan from the Ministry of Health which amounted to i.5 beds per thousand population at the district level. This bed allocation covers both the work of the curative unit and of the preventive work carried out at the district level through the Sta- tion of Hygiene and Epidemiology, and at the commune level through commune staff. At the hamlet/village level, there were village health workers who carried the responsibility for the hamlet; they were supported at the local level. Although allocations were small, and health facilities operated with inadequate facilities, equipment, and drugs, all received an equitable distribution of funds.

LADINSKY ET AL. HEALTH CARE IN VIETNAM

There is general awareness in Vietnam the the Vietnamese Primary Health Care (PHC) concept needs new input, but there is uncertainty as to the right approach and implementation. The Ministry of Health states that between I986 and I990 the health budget, including foreign aid, could only pay for 40% of its most basic requirements. Under these conditions, new sources of financing were instituted. They included charging fees for services, medicines, and medical supplies. The Provincial Health Services individually decided on fee structures for the units in their province. Some provinces decided against charging fees for service but charged for drugs and dressings. Others allowed charging fees for service. The communes decide autonomously whether or not to charge fees. The fees support staff and supplies, but are not sufficient to support new equipment or buildings. It is unclear at present how much the fees actually contribute to the running of health units. The Ministry of Health states the fees raised about zo% of the health center budgets. However, other sources suggest revenue from fees generated only z to 5% of all health center revenue.

QUALITY OF CARE

Related to the demand for curative services is the question of the quality of care. One of the major constraints to quality is, no doubt, the poor salary structure in the health services. When health care was fully State-subsidized, health staff had job security and special benefits. Now that all goods and services are purchased in an open market system, State employees' salaries can no longer support their families. Most people in all sectors of the economy must have at least two jobs to survive. In the health sector, staff engage in private practice and are continually seeking ways of gaining more income. Many physicians leave State practice and seek employment as international pharmaceutical company salesmen, since the salary is significantly higher.

This issue of quality draws attention to related problems. The first is the status of medical facilities and equipment. Even under the fully subsidized health care system, there was virtually no money for upkeep of clinics and hospitals and the purchase of new equipment. New equipment came only from foreign donors, with attendant problems of spare parts and compatibility of equipment from different countries. Equipment for hospitals, for example, could not be maintained and often deteriorated quickly. In addition, equipment was

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often sent to places where it could not be used because of lack of staff training and/or necessary infrastructure support. As a result, the ability of the health services to carry out proper diagnosis and treatment is very limited.

A second problem is training of health manpower. This relates to the knowledge and skills needed today. New disease problems, such as AIDS, and the opening of the country to new scientific approaches and technologies, particularly in the field of public health, focus attention on the type and amount of training. Top management at the provincial level were all given short retraining in health management during the past few years. However, this is only the tip of the iceberg.

The third problem revolves around recently emerging salary differentials. The comparatively wealthy southern parts of the country, such as the municipality of Ho Chi Minh City, grant subsidies to its public sector physicians. There is also evidence that this happens at lower levels, with wealthier units giving more material incentives to staff. Such differentials provide incentives for staff to migrate to wealthier areas, conjuring up images of accessibility and quality of care for the urban elite that are similar to patterns in Africa.

RESTRUCTURING OF THE HEALTH SERVICES

The State lifted restrictions on private practice and, in fact, began to encourage it. This action was intended to have two effects. The first was to encourage individuals with funds to not use the State-subsidized services in order to leave these services for the most needy. The second intended effect was to encourage staff to leave the State sector, thus reducing staff numbers and salaries requiring support from the State.

The financing of health services helps to explain the tension between the national level and the provincial and district levels over control of health services. Officials often quote the saying, para- phrased here, that "you can give orders from Hanoi, but only the provinces will decide how to implement them." Since the establishment of the socialist government, first in the north and later in the south, the Ministry of Health has had diminishing authority or control over lower levels of the health sector, since allocations for funds, based on numbers of beds, were made by the Ministry of Finance directly to the People's Committees at various province and district


levels. Only in recent years, with funds from external donors, has the Ministry of Health had some power to create an accountability system between itself and the lower levels, but this may be short-lived. For one reason, there is little infrastructure in place at that level for the monitoring and evaluation of health programs. For another, the lower levels still have other sources of funds which include taxes raised by People's Committees, fees, and independent negotiating powers with external donors, specifically international Non-Govern- mental Organizations (NGOs) and aid agencies.

A weak Ministry of Health has not been able to provide the tech- nical support at local levels. Even today, there are overlapping programs, mainly those attached to donor programs, which duplicate efforts and strain local resources. In a country with scarce resources, sketchy information systems, and limited updated professional skills, the lack of efficient and effective information systems creates unaf- fordable waste.

All levels are responsible for both curative and preventive activities. In the past, State subsidies supported both treatment facilities and preventive work. With the reduction of these subsidies and the encouragement of private practice and fees for service, pressure for greater emphasis on treatment has already emerged. These services are in greater demand than preventive services and can command a fee. The very low wages in the State health units have already encouraged staff, with the State's blessing, to engage in private curative practice to supplement their income.

It is the view of Ministry of Health officials that treatment services can raise money to support preventive work. However, this idea is not a reality at present. The main reason is that there exists no mech- anism for the re-allocation of income from the growing private sector. At present, this sector has no obligation to return funds to the State.

The means of preserving preventive programs will be the key to the success of the emerging system. If they are weakened significantly, then one result will be a dramatic rise in rates of communicable diseases. The continued existence of a strong grass-roots infrastructure would help to prevent such deterioration, but it certainly will need incentives and support from the higher levels to keep the commitment and contribution intact.

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HEALTH MANPOWER

Related to these issues is the question of health manpower. Previous State support which allowed for approximately 1.5 health personnel per bed and approximately 4 doctors per Io,ooo people, will be very difficult to maintain in the present situation. The Council of Ministers, in a directive to all ministries, has ordered a staff cut of zo% in I999.

There is understandable reluctance, however, to carry out this order. Some Institute directors talk about redistribution rather than

reduction. They seek to move staff from large urban hospitals into the underserved rural and more remote areas. This is in reality only a dream, since unemployed doctors do not want to leave the cities for marginal areas where life is difficult for them and their families. There are now over 4,000 unemployed physicians in Vietnam who would rather remain un- or under-employed than live in the countryside.

A major problem is the planning and distribution of existing manpower and training of new manpower in the present planning vac- uum. The system is likely to remain decentralized in terms of staff establishments which will certainly be undermined through the emerging market economy. State services will shrink as patients choose private sector services or choose less expensive treatments, e.g., home treatments and/or traditional medicine. Evidence of this reduced utilization is already beginning to appear. For example, there are aggregate figures to show that there has been a reduction of visits to public health centers from 130,480,ooo visits in 1988 to 66,9o4,0o0 in I998. In contrast, there is some evidence from Hanoi and Ho Chi Minh City that leading public hospitals are being over- utilized. The larger urban hospitals are attracting more people, most of whom are paying fees. This emerging situation will have serious implications for the provision of services to those who cannot afford private care, and, as we have previously mentioned, to the mainte- nance and expansion of the prevention network. It will also have implications for staffing patterns and training of health personnel.

As we have already noted, there is a very large health establishment in Vietnam. The State has recognized this, and in the last io years has concentrated on re-training existing staff (many of whom were mili- tary medical people), and reducing the number of new trainees. How- ever, with economic and political liberalization, educational institutions now have incentives to increase the number of new medical


trainees since they can now charge fees for medical education. This situation has several implications.

One implication is that there is an incentive to continue to over- produce health staff in the face of a reduction of utilization of services and reduced revenue for salaries. As the State no longer guarantees jobs for graduates, there may be increasing competition. Also, the provision of curative care and drugs, both of which are income-gen- erating activities, will increase, while preventive activities and self- care are discouraged.

Another implication is what we might term "the socialization of costs and the privatization of benefits" in terms of training. In other words, the State will continue to pay for training of the majority of medical personnel, but may lose them to the private sector. As a result, the State system competes with itself and loses scarce investment resources. It also, at present, has little control over the distribution of manpower, since it cannot guarantee jobs.

A third implication is the problem of upgrading the educational system both in terms of quality and standards. This is part of a move to rationalize higher education. At present there appears to be in process a resolution by the Council of Ministers to reorganize post- secondary education into several large universities which include medical facilities, and/or Institutes of Health with facilities for medical training, and a series of community colleges. However, this reor- ganization will not be completely in place before the year zooo. The Ministry of Health will also have to address the issues of training and number of auxiliary personnel.

At present, there is a proliferation of training courses with little overall coordination and little attempt to standardize content. Some are supported by the Ministry of Health; some are supported by fees; most are supported by aid-organization donors. For example, there are approximately zo different training programs in Primary Health Care, each designed by a different aid organization, using different models of training and different curricula with implications for different models of delivery. The Ministry of Health has been unwilling to undertake evaluation of the programs and to decide which models should be used, since they are afraid that if they do this they may lose revenue from the aid organizations. This has produced a type of chaos in the preventive and treatment services of the Primary Health Care delivery system.

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A final implication is the quality of trainers and the access to information. Limited advanced training for staff and very few library and material resources limit the value of the courses. Although the need to improve teaching methods is recognized and the lack of material strongly lamented, scarce resources are not allocated to this critical area.

PHARMACEUTICAL ISSUES

Before the economic changes, what few medicines were available were provided free through the State health care system. The present situation, however, has allowed and, in fact, encouraged the sale of pharmaceuticals at all State health clinics and hospitals and the production for profit of pharmaceuticals at some hospitals. In fact, the sale of drugs is currently the major source of income for the State health care system, since some provinces have decided against service charges but use the sale of pharmaceuticals as their primary source of income.

The cost of medicines focuses on several points concerning the sustainability of health care in Vietnam. Inflation is running at about 6%, which affects the absolute cost of drugs. As income disparities emerge with the expanding market economy, it is probable that certain groups, especially those who most need basic medicines, will not be able to afford them. In addition, any drug can be purchased on the open market. Those with funds are buying the more expensive imported drugs and are not purchasing them from State pharmacies. One result is that these units may not be able to continue to meet patient needs and might not be affordable.

Another pharmaceutical issue is the purchase and use of essential drugs. The Ministry of Health has promoted the use of what it calls "essential and vital drugs" throughout the country. It promotes the use of 250 drugs for basic health care. With an open market approach to pharmaceuticals, however, thousands of drugs are appear- ing on the market, some of which give false claims as to their effects. The government has neither the necessary legislation nor law- enforcement staff to implement an essential drugs policy. While it can and does try to control the counterfeit drugs and illegal imports, it only pays lip service to the use of essential drugs. The government has recently attempted to keep drug prices down by banning the importation of drugs already produced in Vietnam and by licensing

LADINSKY ET AL. HEALTH CARE IN VIETNAM

companies for importing drugs. Time will tell how successful this strategy is.

Use of essential drugs is closely linked to the whole question of rational drug use. Officials recognize a problem of rational drug use and the need to promote an essential drug policy but are pressured not to pursue policies too vigorously. Drugs, locally produced or purchased from abroad, are a major source of income for both the State and private health services and give credibility to both sectors. Pur- chase of expensive drugs and encouragement of the widespread use of drugs generate revenue.

HEALTH INFORMATION SYSTEMS

The basis of restructuring the health system from a wholly subsidized State system to one which functions in a mixed market economy rests on an information system for planning priorities. In the former system allocations were given by the Center and targets were set to jus- tify these allocations. As there was virtually no surveillance or evaluation system, the incentive was to create statistics to show that targets were met. One result is obviously unreliable statistics, a fact recognized by officials at all levels. The other, perhaps more insidious, is lack of a planning mentality and experience in prioritizing and mak- ing allocations on the basis of objectively collected data.

This deficiency may well be the most serious threat to sustaining whatever new system emerges. Without reliable baseline data on such items as unit utilization, infectious disease incidence, staff allocations and salaries, disease control programs, family planning programs, and epidemiologic surveillance, it is virtually impossible to shape a new health care system. The lack of reliable data and a health information system to supply, monitor, and, most importantly, to interpret data is not in place. Although recognizing this weakness, the Ministry of Health still lacks the capable manpower to make a basic system viable.

It appears that community involvement in the past has been focused on mobilization of people for preventive activities and for the material and manpower support of service delivery. Their continued commitment is likely to be difficult as the peripheral health infrastructure disintegrates and patients are galvanized to individually seek services for their own health care.

In July I99z legislation was approved for a national health insur-

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ance scheme. It appears to be modeled somewhat on the French experience. The insurance is intended to cover the cost for government employees for all treatment including inpatient care and drugs, but not private care. The payments are apparently to be linked with the price of rice. Some pilot programs are in place but results are not yet available. A major question centers on the ability of the State to manage the system. At present, there is only a rudimentary tax collection structure in place. The lack of experience, infrastructure, and planning frame- works for managing a market economy bodes ill for the establishment, in the short term, of a successful large-scale governmental health insurance program.

There are two major concerns in the development of new financing mechanisms. The first is that they emerged apparently without any evident systematic planning. The result is that there is a growing private sector over which the State has little control of either quality, quantity, or division of resources between preventive and treatment services. In addition, the private sector drains resources from State services as people opt out of State care. The State provides all the training and most of the facilities for these private services, but gains none of the revenue from their use. The second is that the liberalization of the economy is quickly challenging the principle of equity, as those who have money seek the best services and can afford expensive imported drugs, while the State sector loses both funds and patients, leaving an under-resourced service for the poor.

ROLE OF EXTERNAL DONOR AID

Before 1995 Vietnam had not had massive donor aid, due in large part to the embargo imposed by the U.S. Government. The embargo was lifted in I995. Currently, donor aid to Vietnam is increasing. However, two points must be noted here. First, United Nations health aid has gone mainly to support vertical programs such as Expanded Program of Immunization (EPI), Control of Diarrheal Disease (CDD), Acute Respiratory Infection (ARI), and family planning with emphasis on distribution and promotion of contraception, nutri- tional supplements, and immunizations. Second, this aid is given directly to the Ministry of Health, which decides how and where to develop activities. NGO aid can, in some cases, be negotiated directly with the local level.

In 1986 NGOs contributed about USD $9 million. Several donors


mentioned that the coordination of activities is a serious problem. Lip service is paid to the need for better coordination, but authorities appear to be playing the donors against one another in order to gain more aid and keep control of the situation. This tactic is strengthened from experiences under the previous system where resources were extremely scarce and each Ministry had very little communication with any other Ministry. It also, in the present situation, ensures that the donors are not able to impose their own ideas on the Ministry of Health. As the amount of aid increases and as donors compare notes, Vietnam may lose the goodwill of NGOs which are discouraged and disillusioned by the lack of coordination.

It appears that while the term "primary health care" is bandied about in the Ministry of Health, there is very little shared meaning of the term. There seems to be an umbrella which covers the idea of maintaining health care at the grassroots level through "community involvement." As the mechanisms by which this involvement has been maintained are now disintegrating, this becomes a problematic issue. Primary health care appears to be the rhetoric by which the Ministry of Health thinks it will gain acceptance for its plans by the international, particularly donor, community.

Another additional point which we have not discussed in detail but which has an obvious influence on the sustainability of health care is the north/south differential. The south has more wealth and more history of foreign investment and entrepreneurial activities. The stark visual contrast between Hanoi and Ho Chi Minh City attests to the capacity of the south to respond more aggressively to the new oppor- tunities provided by the changing economic climate. Once again, in the field of health, this difference brings into question how equity is to be pursued under such conditions.

DISCUSSION

It is clear that changes in the Ministry of Health are needed to ensure quality health care and accessibility by all. The consequences of an open market economy were not fully understood or anticipated by government planners in the late I98os. Now that some time has passed it is evident that the intended results were not achieved. Instead of being complementary to the national health system, the private medical sector is draining State resources without any com- mensurate remuneration. The market economy has also created a

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greater differential in wealth between the rich and the poor which has meant that many rural dwellers have seen their real income decline considerably, along with a reduction in health care. Many rural areas lack adequate health personnel while thousands of doctors remain under- or unemployed in the urban areas. The State continues to support health manpower training and provide facility support while private sector doctors are not required to pay fees for these services. In these times of increasing economic potential, the Ministry of Health is facing structural and financial problems.

The government must find ways to effectively finance health care for all its citizens as well as providing trained personnel in rural as well as urban settings. Incentives must be developed to draw doctors to rural practices. There must be centralized coordination of programs and control over the cost and distribution of drugs. Now that the consequences of an open market economy are becoming evident, the government must respond before the system deteriorates further. A comprehensive evaluation of the current health care system should be undertaken, and its needs in the areas of personnel (numbers, distribution etc.), regulation and control of pharmaceuticals, infrastructure development, and financial mechanisms should be evaluated. Some suggested areas for action are:

- Coordinating donor programs, establishing a clearing house for donors which makes information available on all projects and coordination of training of program personnel;

-In pharmaceuticals, establish regulations on imported and domestic pharmaceuticals through central licensing of drugs; taxation of medicines not on the essential drugs list;

- In medical education, the government could establish a scheme to provide free medical education in exchange for a commitment by new graduates to serve a specified amount of time practicing in an underserved area;

- For manpower, establish licensing of physicians, nurses and tech- nicians, and provide financial incentives for physicians and other medical personnel to work in rural areas;

- For financial support, develop a fee schedule for private physicians who utilize state health facilities, and establish taxation of imported drugs and medical equipment to cover the cost of maintaining facilities;


- In support of those unable to pay, establish a sliding scale for medical services at State facilities, and development of a national health insurance scheme with contributions from both public and private sectors.

Vietnam is still experiencing the growing pains of the transition to a market economy but it is already evident that the original expectations of early reforms have not produced the expected results. The Ministry of Health must act to ensure the continuation of improvement in the delivery of health care to all the people of Vietnam.

BIBLIOGRAPHY

Vietnam Ministry of Health. Strategy for Health for All by the Year 2000 and Strategic Health Plan for the Period 1995-2000 in Vietnam. Decem- ber 1998.

Fritzen, Scott. Situation Analysis and Capacity Development Issues for Basic Health in Vietnam. Issues Paper for UNDP/UNFPAIUNICEF Joint Report Capacity Development for Poverty Elimination. Aug. 28, 1996.

Ensor, Tim. "Introducing Health Insurance in Vietnam," Health Policy and Planning io (1995): I54-63.

Vietnam Ministry of Public Health. "Proposed Regulation Should Ease Complaints About Vietnam's Health Services," Vietnam News, June zI, I998.

Vietnam Government Statistics Office (GSO)/UNFPA. Vietnam Intercensual Demographic Survey 1994, Major Findings. Hanoi, Vietnam: Statistical Publishing House, I995.

Vietnam General Statistics Office (GSO). Statistical Data of the Socialist Republic of Vietnam 1988-1998. Hanoi, 1999.

UNDP/UNICEF. Catching Up. Capacity Development for Poverty Elimina- tion in Vietnam.

Asisan Development Bank. Economic Review and Bank Operations, Social- ist Republic of Vietnam, July I998.

Vietnam Ministry of Public Health. Health Statistical Profile. Hanoi, Viet- nam, I997.

Ladinsky, J. L., and Levine, R. E. "The Organization of Health Services in Vietnam," Journal of Public Health Policy 6 (1985): zz5-68.

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ABSTRACT

This paper discusses the impact on the Vietnamese health care system of the change from a centralized socialist system to a market economy. It discusses recent policies based on expectations in relation to actual outcomes, and the impacts these changes have had on health care delivery and health infrastructure in Vietnam. It has become clear that the private medical sector is draining resources from the State rather than complementing the weakened national health system. Impacts on health education, pharmaceuticals, infrastructure support, geographic distribution of physicians, and equity are all discussed in terms of recent economic changes. It is suggested that adjust- ments must be made to ensure adequate health care for all Vietnamese including those in rural areas and the urban poor. The State must develop mechanisms to support the national health service before further deterioration occurs.

Changes in the Health Care System of VN in Response to the Emerging Market Economy

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