In Taiwan, almost all hospitals are non-profit and enjoy tax exemptions. As such, they are social utilities and their primary goal should be to improve health in the spirit of a public service.
Still, outsiders like me have problems understanding why every big hospital seems to care only about increasing revenue and maximizing profit. It is doubtful whether these hospitals have made any contributions to community health. Even the nation’s public hospitals seem to be driven purely by profit. Is this right?
The National Health Insurance (NHI) program is paying hospitals on a per case basis to encourage them to expand, so a bigger hospital gets more for the same examination or treatment as a small hospital. The result is that patients naturally flock to big hospitals where they are treated better.
To receive more money from the NHI program, many hospitals also try to become teaching hospitals. This has made medical care even less accessible in poorer and remote areas. In addition, it is damaging to the nation’s medical treatment in four ways.
First, for-profit hospitals exploit their doctors and nurses. In the US, doctors are paid directly by the health insurance system. However, in Taiwan, doctors receive their pay via the hospital, which typically only gives them about 30 percent of the full payment it receives from the health insurance program. To make more money, doctors work hard to increase quantity, but they do not share that extra profit with the equally hard-working nurses.
This is why medical professionals have criticized the NHI program for having made hospitals rich, doctors thin, nurses exhausted and hurting patients. Doctors of certain departments are paid especially little, such as internal medicine, surgery, obstetrics and gynecology and emergency rooms, which has led to a significant drop in the number of specialists in those areas.
The NHI must carry part of the blame for this state of affairs.
Second, because they are profit driven, many hospitals require doctors to treat and admit more patients. As a result, the average Taiwanese goes to a doctor 15 times a year, which is five times higher than the US average. However, this has not meant that Taiwanese are healthier: unnecessary visits to the hospital is not only a waste of resources it also raises the risk of medical error.
In the US, medical error is the third leading cause of death, even though Americans do not often go to a doctor. The NHI program, which is designed to save lives, must be used carefully so that it does not contribute to more deaths from medical error.
More importantly, statistics show that for-profit hospitals have higher death rates than non-profit ones. This means the differences between for-profit and non-profit hospitals are not just a difference in how much tax they are paying, but also a difference in how many lives they save.
According to a report published in the Journal of the American Medical Association, patients receiving hemodialysis at for-profit facilities are more likely to die than those receiving the same treatment at non-profit hospitals.
As in the US, Taiwanese facilities providing hemodialysis are usually for-profit. It is worth noting that Taiwan has one of the highest rate of hemodialysis patients in the world.
While Canada has about the same quality of medical care as the US, the number of people receiving hemodialysis in the country is only half that of the US. This is because facilities that provide hemodialysis in Canada are non-profit and the number of people receiving the treatment does not affect doctors’ incomes.
Moreover, despite hemodialysis being less common in Canada, the death rate among patients with a kidney disease is lower in Canada, which reflects the advantages of non-profit facilities. The more treatments a patient receives, the more complications and side effects from medication might occur.
At non-profit hospitals, kidney transplants are usually recommended over hemodialysis, thus reducing the risk that kidney disease will result in death. This is a simple alternative that Taiwanese patients should be asking their hospital to provide.
Third, due to the encouragement of the NHI program, hospitals have been investing large sums of money into updating their equipment. Over time, this has turned into an “arms race” of sorts between hospitals and this has distorted the original mission of providing high-quality medical care.
A proton machine costs more than NT$2 billion (US$66.2 million), and a heavy particle machine is NT$4.2 billion. Even if each proton or heavy particle therapy session cost between NT$300,000 and NT$500,000, the return would still be very low. The NT$100 million Da Vinci Surgical System is relatively cheap compared with other advanced medical equipment. Taiwan has the highest density of such systems in the world.
However, following clinical trials, the renowned Lancet medical journal said that it cannot see any advantages to this expensive piece of equipment. Nonetheless, lobbying efforts convinced the NHI to support these investments, which contributed to the negative cycle.
This is not to say that non-profit hospitals should not make any profit, but rather that these profits should be used to ensure that their medical staff are reasonably paid. Furthermore, doctors should be paid through the NHI directly, as is done in the US, to prevent them from being exploited by hospitals.
As soon as a hospital is making a profit, nurses should not be overworked and underpaid, because a medical care system operated at the expense of its staff cannot ensure the health of the public.
The exploitation of medical staff by the hospital was the direct cause behind the recent mass resignation of emergency-room doctors at Taipei Chang Gung Memorial Hospital.
The government should amend the Medical Care Act (醫療法) by adding restrictions to how non-profit hospitals can use their revenue and ensuring that the NHI program pay hospitals the same regardless of their size, as well as requiring hospitals to disclose their financial reports and introduce other measures to enhance medical supervision.
If non-profit hospitals could operate in the true spirit of a non-profit organization, the nation would see lower death rates and a higher life expectancy.
The government should also try to follow through on the third-generation NHI program promoted by former minister of health and welfare Lin Tzou-yien (林奏延). Lin’s program, which emphasizes prevention over cure, is aimed at reforming the system by reducing the wealth gap and educating the public about the importance of regular exercise and not smoking. Hopefully, it would help the public change their habit of relying on medication and help people take more responsibility for their health.
Wen Chi-pang is a distinguished research fellow at the National Health Research Institutes and chair professor at China Medical University.
Translated by Tu Yu-an