Bogota hospitals at risk of bankruptcy to receive govt help

Posted on Mar 17 2014 - 4:57pm by Rico
Hospital

Colombia’s national government on Monday offered an economic lifeline to 14 Bogota city hospitals on the brink of bankruptcy in another attempt to fix the country’s debt-ridden healthcare system.  Finance minister Mauricio Cardenas, in a letter to Bogota mayor Gustavo Petro, explained the government’s decision to financially support the hospitals, enabling them to consolidate their finances.

Government throws lifeline

“The reality of these hospitals is that over many years, they have accumulated huge debts related to their operations and performance. This cumulative position, led to the national government, through the Health Ministry, to take alarm at the risk of closure of these health institutions,” declared the finance minister.

As a result of this financial situation, “the government decided to throw a lifeline to these hospitals, providing the financial viability they need, so as to guarantee they can continue to provide their services.”

According to the newspaper El Espectador, the hospitals proposed a number of fiscal measures to the finance ministry in order to strengthen themselves institutionally. The proposed changes hope to increase revenues, streamline spending and pay off debts.

The finance minister declared that the accumulated debt by the close of 2013, amounted to $150 million, which would be financed jointly by the resources of the hospitals and the Bogota district accounts.

MORE: Colombia govt transfers funds in face of hospital debt crisis

“What is today happening in Bogota, the Finance Ministry has been doing with all public hospitals in the country, with the end goal being that all Colombians continue to receive healthcare.”

Help not only for Bogota, says minister

The government’s support of these 14 Bogota city hospitals is suggestive of an effort to solve the problems caused by the publicly funded EPS organisations who owe the most to the hospitals.

“What is today happening in Bogota, the Finance Ministry has been doing with all public hospitals in the country, with the end goal being that all Colombians continue to receive healthcare,” continued the finance minister.

“The health of all,” concluded the finance minister, is a priority of the national government which has so far failed to push health reforms through Congress.

Colombia’s health debt crisis stems primarily from a problematic publicly funded health intermediaries known as EPSs, which are in charge of designating health plans and reimbursing hospitals for services. The problem, however, is that the EPS are poorly managed and highly corrupt, causing payments to come in short, late or sometimes not at all. In some cases, EPSs created their own hospitals and began competing with the medical centers they were supposed to financially support.

Sources

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