Puerto Rico Health Reform
Encyclopedia
The Puerto Rico Health Reform (Reforma de Salud de Puerto Rico in Spanish), locally referred to simply as the Reform (la Reforma in Spanish) is a government-run program which provides medical and healthcare services to indigent and impoverished citizens of Puerto Rico
by means of contracting private health insurance
companies, as opposed to the traditional system of government-owned hospitals and emergency centers. The Reform is administered by the Puerto Rico Health Insurance Administration and, as of December 31, 2005, provides healthcare coverage to over 1.5 million Puerto Ricans, equal to 37.5% of the island population. The life expectancy
of Puerto Rico is higher than that of the United States.
for their healthcare needs since the start of the island's commonwealth status
. The government maintained several hospitals, emergency centers, and free clinic
s, including the Rio Piedras Medical Center (Centro Médico in Spanish) which is considered the largest hospital on the island and one of the largest in the Caribbean. However, this system presented substantial costs to the government while generating increasing criticism from the public and media citing a sluggish bureaucracy and poor services from unprofessional government workers.
In 1994, then Governor of Puerto Rico
Pedro Rosselló
proposed and implemented the privatization of the public health system under the name "Health Reform". The privatization plan included selling the government-owned hospitals and medical centers to local and United States investors and then implementing a universal free and/or low-cost health insurance plan for poor and needy citizens. The only exception to the Reform was that mental health benefits and services were to be provided by behavioral healthcare and mental healthcare companies, and not by insurance carriers.
The privatization plan required the service population to be divided into geographical areas with each area assigned to a sole insurance carrier by means of a services contract awarded through competitive bidding and proposals. The designation and assignment of geographical areas were finalized in 2001. Subsequent to 1994, all government hospitals and medical centers were sold to private companies and investors, including local medical groups and companies composed of doctors. The only exception to the privatization plan was that the Rio Piedras Medical Center would be (and still is) run by the commonwealth government.
The privatization plan has met subsequent criticisms from different industry and public sectors, who argue that the plan was marred with government corruption. Several politicians, private investors, and government employees have been accused and/or convicted of perpetrating bribery and extortion schemes during the selling and acquisition of government medical centers. One of the most famous convictions was that of prominent New Progressive Party
legislator Edison Misla Aldorondo.
with 26.1%.
The Reform has faced criticism from different sectors because of the increasing costs associated with the system. Under the administration of Gov. Sila Calderón, the government tried to cut back on services and eliminated many participants from the program in an effort to curtail expenditures. However, the program still requires a substantial amount of funds to cover its $1.4 billion annual expenditures (2005). In 2005 alone, only $400 million was generated from participant deductibles and charges for services to cover program expenses, while the remaining $1 billion in expenses was covered by a subsidy provided by the state government. Since medical costs are expected to increase, experts have expressed serious concerns over the future funding of the program.
These criticisms and fallbacks have led the government to implement more stringent controls over the operations of the Reform as well as to diversify the way it provides services to beneficiaries. A pilot project began in 2003 whereby the government contracted the services of one area directly to a medical healthcare provider instead of contracting an insurance company, and the government has stated that this and other programs may be implemented and expanded in the future in order to reduce costs. However, some politicians, including former Gov. Pedro Rosselló, are campaigning to create a universal health care
system by expanding the reform program to all citizens that lack a private insurance plan.
Puerto Rico
Puerto Rico , officially the Commonwealth of Puerto Rico , is an unincorporated territory of the United States, located in the northeastern Caribbean, east of the Dominican Republic and west of both the United States Virgin Islands and the British Virgin Islands.Puerto Rico comprises an...
by means of contracting private health insurance
Health insurance
Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care expenses among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is...
companies, as opposed to the traditional system of government-owned hospitals and emergency centers. The Reform is administered by the Puerto Rico Health Insurance Administration and, as of December 31, 2005, provides healthcare coverage to over 1.5 million Puerto Ricans, equal to 37.5% of the island population. The life expectancy
Life expectancy
Life expectancy is the expected number of years of life remaining at a given age. It is denoted by ex, which means the average number of subsequent years of life for someone now aged x, according to a particular mortality experience...
of Puerto Rico is higher than that of the United States.
History
Puerto Rico's indigent population has relied exclusively on the local governmentGovernment of Puerto Rico
The Government of Puerto Rico is a republican form of government subject to U.S. jurisdiction and sovereignty. Its current powers are all delegated by the United States Congress and lack full protection under the United States Constitution...
for their healthcare needs since the start of the island's commonwealth status
Commonwealth (United States insular area)
In the terminology of the United States insular areas, a Commonwealth is a type of organized but unincorporated dependent territory.The definition of "Commonwealth" according to current U.S. State Department policy reads: "The term 'Commonwealth' does not describe or provide for any specific...
. The government maintained several hospitals, emergency centers, and free clinic
Free clinic
A free clinic is a medical facility offering community healthcare on a free or very low-cost basis in countries with marginal or no universal health care. Care is generally provided in these clinics to persons who have lower or limited income and no health insurance, including persons who are not...
s, including the Rio Piedras Medical Center (Centro Médico in Spanish) which is considered the largest hospital on the island and one of the largest in the Caribbean. However, this system presented substantial costs to the government while generating increasing criticism from the public and media citing a sluggish bureaucracy and poor services from unprofessional government workers.
In 1994, then Governor of Puerto Rico
Governor of Puerto Rico
The Governor of Puerto Rico is the Head of Government of the Commonwealth of Puerto Rico. Since 1948, the Governor has been elected by the people of Puerto Rico...
Pedro Rosselló
Pedro Rosselló
Pedro Juan Rosselló González, M.D., , is a Puerto Rican physician and politician who served as the sixth Governor of the Commonwealth of Puerto Rico from 1993 to 2001...
proposed and implemented the privatization of the public health system under the name "Health Reform". The privatization plan included selling the government-owned hospitals and medical centers to local and United States investors and then implementing a universal free and/or low-cost health insurance plan for poor and needy citizens. The only exception to the Reform was that mental health benefits and services were to be provided by behavioral healthcare and mental healthcare companies, and not by insurance carriers.
The privatization plan required the service population to be divided into geographical areas with each area assigned to a sole insurance carrier by means of a services contract awarded through competitive bidding and proposals. The designation and assignment of geographical areas were finalized in 2001. Subsequent to 1994, all government hospitals and medical centers were sold to private companies and investors, including local medical groups and companies composed of doctors. The only exception to the privatization plan was that the Rio Piedras Medical Center would be (and still is) run by the commonwealth government.
The privatization plan has met subsequent criticisms from different industry and public sectors, who argue that the plan was marred with government corruption. Several politicians, private investors, and government employees have been accused and/or convicted of perpetrating bribery and extortion schemes during the selling and acquisition of government medical centers. One of the most famous convictions was that of prominent New Progressive Party
New Progressive Party of Puerto Rico
The New Progressive Party of Puerto Rico is a political party that advocates for Puerto Rico's admission to the United States of America as the 51st state...
legislator Edison Misla Aldorondo.
Current status
The three largest insurance companies operating in Puerto Rico are currently the only ones participating in the Reform. These are Triple-S, Inc. with 40.4% of the Reform beneficiaries, Medical Card Systems (MCS) with 33.5%, and HumanaHumana
Humana Inc. , founded in 1961 in Louisville, Kentucky, is a Fortune 100 company that markets and administers health insurance. With a customer base of over 11.5 million in the United States, the company is the largest Fortune 100 company headquartered in the Commonwealth of Kentucky, and has a...
with 26.1%.
The Reform has faced criticism from different sectors because of the increasing costs associated with the system. Under the administration of Gov. Sila Calderón, the government tried to cut back on services and eliminated many participants from the program in an effort to curtail expenditures. However, the program still requires a substantial amount of funds to cover its $1.4 billion annual expenditures (2005). In 2005 alone, only $400 million was generated from participant deductibles and charges for services to cover program expenses, while the remaining $1 billion in expenses was covered by a subsidy provided by the state government. Since medical costs are expected to increase, experts have expressed serious concerns over the future funding of the program.
These criticisms and fallbacks have led the government to implement more stringent controls over the operations of the Reform as well as to diversify the way it provides services to beneficiaries. A pilot project began in 2003 whereby the government contracted the services of one area directly to a medical healthcare provider instead of contracting an insurance company, and the government has stated that this and other programs may be implemented and expanded in the future in order to reduce costs. However, some politicians, including former Gov. Pedro Rosselló, are campaigning to create a universal health care
Universal health care
Universal health care is a term referring to organized health care systems built around the principle of universal coverage for all members of society, combining mechanisms for health financing and service provision.-History:...
system by expanding the reform program to all citizens that lack a private insurance plan.
See also
- Public welfare in Puerto Rico
- Health care systems
- Universal health careUniversal health careUniversal health care is a term referring to organized health care systems built around the principle of universal coverage for all members of society, combining mechanisms for health financing and service provision.-History:...
- Nutrition Assistance for Puerto RicoNutrition Assistance for Puerto RicoNutrition Assistance for Puerto Rico or NAP is a federal assistance nutritional program provided by the US Department of Agriculture solely to the Commonwealth of Puerto Rico, a self-governing dependency of the United States. It provides over $1.5 billion in supplemental economic resources to help...
- Government of Puerto RicoGovernment of Puerto RicoThe Government of Puerto Rico is a republican form of government subject to U.S. jurisdiction and sovereignty. Its current powers are all delegated by the United States Congress and lack full protection under the United States Constitution...
External links
- Puerto Rico Department of Health website (Spanish)
- Health statistics in Puerto Rico (Spanish)