Corruption in the Health Sector in Albania

Consultant Report

March 1 – March 15, 2003

USAID/Albanian Civil Society Corruption Reduction Project

No. 4503-001-SA-43-00

Management Systems International

Taryn Vian, Assistant Professor of International Health

Boston University School of Public Health

(tvian@bu.edu)

ii

Acknowledgements

Special thanks to Carlos Guerrero, Fatbardh (Bardi) Kadilli, and all the staff of MSI

Albania for their kind assistance and thoughtful insights to this work. Thank you to

Helen Grant and Bert Spector of MSI Washington for helping me prepare for this

assignment.

iii

Table of Contents

Abbreviations and Acronyms .................................................................................... iv

I. Scope of Work .......................................................................................................... 1

II. Vulnerabilities to Corruption in the Sector ......................................................... 1

A. Contextual Factors: Ongoing Health Reform ...................................................... 1

B. Findings ................................................................................................................ 2

Table 1: Areas of Vulnerability to Corruption in Health in Albania .................... 2

1. Informal Payments ............................................................................................ 3

Table 2: Informal Payments ................................................................................... 4

2. Personnel Issues ................................................................................................ 6

3. Medicines .......................................................................................................... 7

4. Budget and Cash Management ......................................................................... 9

III. Feasible Ideas for Remedying Vulnerabilities ................................................... 9

Figure 1: Anti-Corruption Strategies ................................................................... 10

Figure 2: Strategies for Albania, by Level of Commitment and Capacity ......... 11

C. Promote Awareness on Informal Payments ....................................................... 12

D. Research and Analysis of Data on Informal Payments ...................................... 14

E. Develop a Citizens Advocacy Office for Health Concerns ................................ 15

F. Trend Analysis of Prices and Affordability ........................................................ 15

Figure 3: Private Pharmacy Prices in Armenia ................................................... 16

G. Citizen Representatives on Committees ............................................................ 16

IV. Implementation Capacity .................................................................................. 17

V. Estimated Resources and Next Steps ................................................................. 17

Annex 1: List of Contacts ......................................................................................... 19

Annex 2: List of Documents Consulted .................................................................... 20

Annex 3: Workshop on Health and Corruption .................................................... 22

Annex 4: Comparative Data on Informal Payments in Eastern Europe and

Central Asia .............................................................................................. 25

Annex 5: Hypothetical Model of Perceived Acceptance of Informal Payments, by

Type of Activity ........................................................................................ 26

iv

Abbreviations and Acronyms

ACAC Albanian Coalition Against Corruption

CA Collaborating Agency

CAO Citizen’s Advocacy Office

COP Chief of Party

HII Health Insurance Institute

INSTAT Institute for Statistics

MOH Ministry of Health

MPR Median Price Ratio

MSI Management Systems International

NGO Non-Governmental Organization

PETS Public Expenditure Tracking Survey

PHR Partners for Health Reform

RPM Rational Pharmaceutical Management

USAID United States Agency for International Development

1

I. Scope of Work The purpose of this assignment was to support the USAID/Albanian Civil Society

Corruption Reduction Project, Management Systems International (MSI) and the

Albanian Coalition Against Corruption (ACAC) by

Identifying areas of major vulnerability to corruption in the health sector; and

Identifying potential activities that civil society groups, institutes and government

offices can pursue to remedy these vulnerabilities.

I accomplished this through 1) document review and communications with USAID health

projects, World Bank/Washington and other experts before traveling to Albania; 2)

interviews and document review in country; and 3) a workshop to present strategies from

other countries and discuss ideas for future activities in Albania.

During the two weeks in Tirana I met with Ministry of Health officials, hospital directors,

health insurance institute officials and other government supported institutes, Tirana

Regional Health Authority, international partner organizations, private doctors and local

NGOs. See Annex 1 for list of contacts, and Annex 2 for a list of documents reviewed.

MIS sponsored a workshop during the second week for health sector stakeholders to

begin a dialogue on possible anti-corruption strategies and activities. See Annex 3 for

workshop output.

II. Vulnerabilities to Corruption in the Sector

A. Contextual Factors: Ongoing Health Reform

This assessment took place during a period when the Albanian health sector is

undergoing major reform in the organization, financing and delivery of health care

services. Problems that the health reforms are addressing include inadequate financing,

inefficient administration, and inequities in the distribution of resources and achievement

of health outcomes.1 Major components of the health reform include expansion of the

national health insurance program; consolidation and decentralization of health care

management responsibilities, and reorganization of the service delivery system to focus

on primary health care. One of the government’s goals is to have the Health Insurance

Institute become the sole source of payment for all health care by 2005. International

partner organizations are supporting these changes through capacity building, research

and pilot testing, and other development activities. Current steps in the reform process

1 For more discussion on health reform, see: Republic of Albania Ministry of Health, “10 Year

Development Strategy of the Albanian Health System” (2002); Center for European Constitutional Law,

“Report on the Albanian Health System and Proposed Reform Plan” (December 2002); Fairbank and

Gaumer, “Organization and Financing of Primary Health Care in Albania: Problems, Issues and Alternative

Approaches” (PHR Plus Project Draft 1/21/03), and PHR Plus Country Assistance Plan, December 2002.

2

are focused on gaining consensus on key components of the reform, passing appropriate

legislation, and planning for implementation.

One tool for assessing the potential for corruption in an organization is called

vulnerability assessment.2 This tool looks at individual institutions or systems to evaluate

the inherent risk for corruption, the control environment, and existing safeguards. In fact,

I found it difficult to apply this tool in Albania because the health sector is undergoing

such radical but still uncertain changes. Another approach to thinking about corruption

focuses on three main analytical tasks:

1) disaggregate types of corruption;

2) determine the scope and seriousness of each type; and

3) identify the beneficiaries and the losers.3

I used this approach to assess corruption in the Albanian health sector, and in this report I

emphasize anti-corruption strategies that are independent of the particular health reforms

and management systems adopted. Activities that fit this requirement include strategies

to increase transparency, strengthen citizen voice, and increase awareness. MSI and the

Albanian Coalition Against Corruption should monitor developments in this sector to

support other anti-corruption activities that are more closely linked to specific health

reforms. Once details about the implementation plan for health reform emerge, it may be

appropriate to re-assess vulnerabilities.

B. Findings

Table 1 shows areas of vulnerability that I explored during this trip.

Table 1: Areas of Vulnerability to Corruption in Health in Albania

Activity Types of Corruption Likely in Albania

Provision of services by

frontline health workers,

personnel management

Informal payments; private practice during public work hours; over-

utilization due to financial incentives; absenteeism; favoritism in personnel

appointments and hiring

Drug selection and use Financial influence used by private companies or pharmacies to get drugs

added to reimbursement list; over-prescription for financial gain; illegal

financial relationships between public doctors and private pharmacies

Procurement of drugs and

medical equipment

Private financial interests affecting decisions of what to procure; collusion

among bidders; kickbacks or bribes that allow certain bidders access to

confidential procurement information during the selection process; low

quality performance that has no repercussions; use of direct procurement

rather than competitive, without good reason

Distribution and storage of

drugs

Theft from public facilities for resale in private sector

Regulatory systems Bribes or influence used in drug registration and licensing/control of

quality of drugs; lack of standards or regulatory control of public and

private facilities

Budget management Leakage of official fee revenue (very low collection rates)

2 U.S. Office of Management and Budget, Internal Control Guidelines, cited in Robert Klitgaard,

Controlling Corruption. Berkeley, CA: University of California Press. 1988, p. 84-85. 3 Klitgaard 1988, p. xiv.

3

“The informal payment system is so

accepted that doctors leave at the end of the day and turn to each other to ask ‘How much did you make today?’ Although patients are reluctant to

complain to the doctors, they will get angry and disillusioned when they leave the facility, and they lose confidence in the system.”

Participant Health and Corruption Workshop Tirana,

3/03

In assessing vulnerability, I first focused on high expenditure areas. In Albania,

government health care expenditures are mainly recurrent (90-95% depending on the

year), with the highest spending on hospital care (54%) and pharmaceuticals (23%).4

Since private expenditures are significant and may account for half of total health

expenditures in the country, 5

I also focused on spending for drugs and informal

payments.

The main categories of vulnerabilities discussed further in this report are:

Informal payments made outside the official fee structure for services or

supplies that are supposed to be provided free of charge by public medical

personnel.

Personnel issues such as influence used in selecting appointees, absenteeism, and

private practice by public employees outside allowable bounds.6

Medicines, including corruption in drug selection, procurement, licensing and

quality control. The drug procurement process is part of a larger problem of

national government procurement.

Budget and cash management

Areas not explored. The area of medical education was not seen as particularly

vulnerable to corruption (i.e., people didn’t feel that bribes for admission or graduation

were common practice). I did not ask about corruption in hospital construction or

rehabilitation as the health investment budget in Albania is small and problems in this

area would not differ much from general problems of public works corruption. Few

people brought up problems of corruption in sanitary regulation or licensing of private

facilities, so these issues also were not explored any further during this trip.

1. Informal Payments

Table 2 summarizes aspects of the problem of

informal payments, including the perceived

scope and seriousness, who benefits from the

practice, and who loses. This issue has attracted

public interest recently through media coverage

of egregious cases, including a woman in labor

who was turned away from a public facility

because she could not afford to pay and ended up

delivering the baby at home.

4 European Observatory on Health Care Systems, “Health Care Systems in Transition: Albania” data from

1994-96. 5 Partners for Health Reform Plus Country Assistance Plan, December 2002, p. 6.

6 Private practice is allowed by official order. Conditions are complicated and not easy to understand.

They vary depending on educational level of the doctor (whether he or she has a PhD) and whether the

doctor owns the private clinic or is just an employee. Doctors with PhD are not allowed to also work in a

private clinic that they own. The doctor’s employer (e.g. hospital director) must give permission to dual

job hold. (I was not able to obtain the actual law for review.)

4

The Minister of Health was concerned that the media were overstating this problem.

Specifically, he felt that although there were problems of professional ethics concerning

the acceptance of informal payments by some doctors, in most cases patients really want

to make these payments because they think they will receive better care and medical

personnel accept the payments because the salaries of health personnel are very low. In

addition, there is a traditional practice of giving gifts to thank providers such as doctors

or nurses, although these gifts should come after the service and not before.

Ultimately, the Minister thought the best intervention to reduce this problem would be to

expand health insurance to allow increases in compensation of health personnel. He also

proposed an information campaign to make sure patients know that health services in

public facilities are free and they do not have to pay. The Deputy Minister mentioned

informal payments as a lower tier problem, after drug procurement (including budgeting

and financial management related to procurement), drug distribution and sale, and

administrative practices in use of hospital funds.

Table 2: Informal Payments

Assessment

Area

Findings

Types of

Corruption

Under-the-table, unsanctioned payments to health care providers for

services that are supposed to be free; sale of medical supplies to

patients when the supplies are supposed to be free

Scope Pervasive, estimated 89% of inpatients and 80% of outpatients make

the payments

Seriousness No consensus. A lot of recent, negative press and some vocal critics;

however, many people feel the payments are fair since health

personnel are so poorly paid, and there is a direct quid-quo-pro

Beneficiaries Almost all levels of staff (payments may be shared when given to

doctor, or patients may pay each staff member directly)

Well-connected individuals (may not be asked to pay because of

relationships)

Patients who can afford to pay (feel safer, more likely to get

quality service)

Government (less pressure for health reforms by health personnel)

Surgeons (make most money)

Losers Patients who receive unnecessary interventions merely to increase

staff’s compensation

Patients who cannot afford fees but feel obliged to pay (may not

seek care, or may sell assets to have cash to pay under-the-table)

Patients who try to get free care (may be refused or get lower

quality care)

Government (loss of control over health care policy, creation of

private system operating in a “shell” of public sector)

Other key informants felt that informal payments was an important issue, but either they

were doubtful that people in key positions in government really cared about the problem,

or they were not sure that anything could be done about it short of major health reform

that would allow large increases in provider compensation.

5

In two facilities, Tirana Maternity Hospital (a public facility) and Poliklinika “Lui

Paster,” (a private clinic) managers described the steps they had taken to reduce informal

payments by educating patients and increasing provider compensation through “above

table” fees. These experiences provide evidence that it is possible to reduce the practice,

as described in boxes 1 and 2.

The experience in Tirana

Maternity is instructive and

hopeful.7 At the same time,

some people interviewed

questioned whether informal

payments had really been

eliminated, citing the high

expense particularly of

inpatient procedures offered at

the hospital--hysterectomies,

for example. Reportedly,

doctors can make $100 for this

procedure under-the-table.

Further monitoring and

evaluation of the experience at

Tirana Maternity may be able

to answer these questions. If

the Tirana Maternity

experience is really working,

one would hope to see lower

reported rates of informal

payments among former

patients when compared to

patients served at other

hospitals in the city.

Out-of-pocket expenditures in Albania may be increasing over time. The author of a

World Bank-sponsored analysis of national health accounts in 2000 found that 20-25% of

total health care expenditures were out-of-pocket payments for everything: doctors,

nurses, drugs, clean sheets, and more.8 The figure cited in the Government’s 10 Year

Health Development Strategy is 20%. However, a more recent study by the Partners for

Health Reform Plus indicates that out-of-pocket expenditures have risen to about 50% of

total health care expenditures, with perhaps 30% attributed to informal payments.9 Soon-

to-be-released data from the World Bank-sponsored Living Standards Measurement

Survey may provide additional quantitative data on private expenditures.

7 See “Opinions and Results on the Fight Against Corruption in the Health Sector,” by Dr. Halim Kosova.

Obstetric-Gynaecological University Hospital of Tirana (a.k.a. Tirana Maternity Hospital). July 2002. 8 Interview with Christopher Bladen.

9 Interview with COP of PHR Plus.

Box 1: Tirana Maternity’s Fight Against Corruption

The 300-bed Tirana Maternity Hospital is also the home of the

Women’s Wellness Center opened in 2001 as part of a USAID-

sponsored health partnership. Since opening, the Center has

served over 10,000 outpatients. The director of the Maternity

Hospital described how he began an initiative to combat informal

payments three years ago. He knew that he could not fight the

problem without doing something about doctors’ wages, so he

began to strengthen the existing system of officially allowed

“secondary payments” or user fees for drugs and ancillary

services (pap smear, mammography, amniocentesis, and other

diagnostic tests). He posted the official fee schedule and

streamlined systems for cash receipts, cash management,

financial accounting and reporting. Through these actions, he

was able to increase revenue from 900,000 Leks ($7,031) to

2,590,000 Leks ($20,234) over two years. This revenue is

allocated for staff salary supplements (70%) and for supplies

replenishment (30%). Salary supplements for doctors are

distributed according to services provided and this has

quadrupled doctors’ compensation. Auxiliary staff salaries have

doubled and administrative staff receive supplements too. The

hospital director also posted signs saying no one should make any

payments outside the regular channels. To reinforce this

message, the hospital has surveyed patients using an exit

interview and is placing suggestion boxes in patient areas to

solicit feedback. The hospital director believes that successful

attack on informal payments has resulted in increased utilization.

6

Box 2: Poliklinika Lui Paster and Performance-based Compensation Poliklinika Luis Paster started in July 2002 as a private

oncology clinic. Adult patients pay fee-for-service, while

pediatric patients receive treatment free of charge if their

family cannot pay. Doctors receive a base salary of $150

per month, plus a payment based on the number of

treatments the doctor performs. At first this concept was

hard for the doctors to understand and they were reluctant

to accept the risk, but within six months they had adapted.

Total compensation for doctors averages between $800

and $1,200 per month, compared to public salaries of $100

to $300 per month. At first patients still wanted to make

informal payments (gifts) to doctors, even with an official

fee schedule. The clinic director posted signs and kept

explaining the system, and now people seem to understand

and accept that the clinic is serious about not wanting any

payments, even gifts, to be made outside official channels.

Regarding informal payments specifically, Albania has one of the highest rates when

compared to countries in Eastern Europe and Central Asia (see Annex 4). A World

Bank-funded study in Albania in 2000 found that 87% of people surveyed admitted to

one or more cases of “illegal payment” to a doctor in the hospital.10

A similar percentage

gave illegal payment to a hospital nurse, while 80% admitted illegal payments to doctors,

nurses or midwives in health centers. The study concluded that people fell into two

groups: first, those patients who feel “forced” to pay in order to receive adequate

services, and secondly, those who pay for traditional reasons. Interventions effective for

the first group might need to focus on management of staff to prevent direct pressure for

payments, while the second group would need change strategies focused on public

perceptions and values. See Annex 3 for additional perceptions of Albanians who

attended the Health and Corruption workshop.

2. Personnel Issues

Besides informal payments, people

raised three other important

personnel management issues.

First, there was concern about lack

of objectivity in appointment and

hiring of staff. Several people

mentioned that hospital director

appointments in particular seem to

be politically motivated, and

directors therefore may not have

adequate skills for the job. A

related point is that management

skills in general are not well

developed among Albanian doctors

and health professionals. These

issues contribute to poorly

functioning hierarchical control systems that reduce the probability corruption will be

detected and sanctioned.

A second personnel issue is physicians who are practicing in both the public and

private sector. Regulation of private sector is very new and has not been implemented

fully. This is an area where abuse may be likely, as physicians will be earning much

more from private practice, and may divert time and resources there. The third problem

is physicians who have financial interest in private ancillary services, including

pharmacies. Some financial interests are direct (they are owners) and some may be less

open (e.g. kickbacks for sending clients to certain pharmacies). Legislation to regulate

private practice of medicine can be helpful in controlling corruption and abuses in this

10

World Bank, “The Albanian Public’s Perceptions of the Health Care System.” September 2000. The

study included 4,895 respondents ages 15-99 representing the whole country. Focus groups were held with

an additional 150 respondents.

7

area. The Russia Legal Health Reform Project has developed laws and guidance that

may be helpful for reference.11

3. Medicines

Areas of vulnerability to corruption in medicines include drug regulation, procurement,

drug selection and reimbursement committees, pricing of medicines, pharmacy relations

with prescribers (addressed in the previous section), and stock control in public facilities.

The Minister raised concerns about unregistered, unlicensed drugs in the country, and

diversion of drugs from public hospitals to private pharmacies. The Deputy Minister was

likewise concerned first with problems in the pharmaceuticals sector. He noted

weaknesses in the management of procurement and (to a lesser extent) resale of publicly-

purchased commodities.

Albania has a relatively small pharmaceutical market ($50 million/year); therefore direct-

to-physician promotional activities by large multinational companies are unlikely to be a

big risk. Theoretically the risks in drug regulation include bribes or kickbacks to

influence (or bypass) the process of licensing and registration of drugs, as well as lack of

enforcement of laws regarding licensing and operation of private pharmacies. People

mentioned that both types of problems may exist. The Ministry of Health and the

National Center for Drug Control each have regulatory responsibilities related to

licensing, certification and quality control in the pharmaceuticals sector.

Reforms in the National Procurement Agency will affect medicines procurement as

well. Starting January 2003, Albania is implementing a “single procurement” process

where all procurement will be done at the central level. Within the health sector, special

attention should be placed on the quantification and planning process for procurement, as

corruption may influence decisions about what drugs to procure and how much to order

(presumably this task is still decentralized to hospital directors although no

implementation guidelines have been produced). All hospital directors should have

access to recent drug price information guides such as the MSH Price Indicator Guide

(available online).12

Transparency of government procurement systems is an area where

the ACAC’s Working Group on Procurement can have an impact by pressuring

government to publish award information and to create and monitor indicators of

performance for suppliers. A law exists that requires the public release of procurement

data starting January of this year, but assuring compliance will be a big challenge in

addition to finding ways to make data accessible and useful for different audiences.

11

For example, the background paper “Issues to be addressed in a law governing the private practice of

medicine,” (1996) discusses restrictions and disclosure requirements on ownership of facilities, controlling

diversion from the public health care system, and regulation of use of public facilities in private practice.

All documents are available through the web site http://dcc2.bumc.bu.edu/RussianLegalHealthReform/ or

on CD (contact ih@bu.edu). 12

Available through MSH Electronic Resource Center, http://erc.msh.org/ Follow link for “International

Drug Price Indicator Guide.”

8

I was not able to review the revised government decrees concerning committees for

drug nomenclature and drug reimbursement.13

Some people have suggested that

members are influenced by financial interests when making decisions. This suspicion

was reinforced by one MOH official who claimed that offers had been made to purchase

the not-yet-approved new list of members of the committees. Strategies to address this

vulnerability could include 1) adding representatives of civil society watchdog

organizations to the committees; 2) publishing committee proceedings and making

meetings open to observers; 3) analyzing decisions of the committee where they seem to

be based on personal rather than public interests.

Many people were concerned about possible pricing anomalies for medicines. The

health insurance reimbursement policies are confusing for patients. For example,

pharmacies are obliged to provide drug price information to patients, but the

reimbursement list it is too long to post and patients may not feel empowered to ask to

see the official price book. Pharmacies are required to stock only a subset of the full

reimbursable drug list of 342 items, and patients may not know which ones are required.

Finally, some drug prices are allowed an increase above the official price, and consumers

do not know which prices are allowed to change.

Possibly some pharmacies are also over-billing the insurance program for money they

actually recovered directly from the patient. The insurance program tries to detect

problems by analyzing drug reimbursement data by pharmacy, and plans to improve its

abilities to detect billing fraud through new arrangements with preferred wholesalers.

The wholesalers will contract with the Health Insurance Institute to offer lower purchase

prices to HII-contracted pharmacies, and will share sales data with the insurance fund

which can then be cross-checked against pharmacy reimbursement requests.

Finally, stock control in public facilities may allow theft of medicines and supplies to

go undetected. Possibly hospital managers are reluctant to crack down on the practice

because they know that employees are ill paid, or the directors are involved themselves.

This problem requires both a technical solution (better inventory systems) and an

incentives solution to assure that the technical solution is used. The Director of Tirana

Maternity Hospital reported that essential medicines are almost always in stock, due to

the combined use of good inventory control, revenue collection systems, and the sharing

of official fee revenue with staff as supplements to salary. This demonstrates that it is

possible have improvements in this area even without external investment in systems

development. PHR Plus may have examples from primary care facilities where medical

supply control systems have been implemented successfully. A role for civil society

could be to highlight these successes to build public awareness and demand for reforms

in other facilities. At the same time, it is possible that if many or most public agents

working with medical supply systems are corrupted, this type of publicity could harm the

honest agents who would be pressured to go along with the majority. This potential

danger would need to be explored in more detail.

13

Older versions of these government decrees are found in the RPM Plus report by Savelli and

Semenchenko dated October 2002.

9

4. Budget and Cash Management

Budget management vulnerabilities to corruption include lack of oversight in the

budgeting and planning process, weakly-enforced official fee systems, and possible

diversion of funds at local government level. The latter problem may not be corruption

but rather a case of local government units giving low priority to health spending when

they are using unrestricted funds. Health policy makers are still defining functions under

decentralization, so future budget management issues may change. Two organizations

involved in this area are Urban Research Institute and Partners for Health Reform Plus.

For hospitals, there is limited autonomy in budget management and even less now due to

recentralization of procurement budgets, as of Jan. 1, 2003.

There are plans to introduce an improved budget tracking system and National Health

Accounts, as part of the second Poverty Reduction Support Credit Program of the World

Bank.14

In addition, the MSI Public Finance Consultant report (March 2003) has made

recommendations about a Public Expenditure Tracking Survey (PETS) that can be

helpful in pinpointing specific corruption problems that need to be addressed.

Regarding official fee systems, the experience of Tirana Maternity shows that official fee

revenue can be greatly increased if proper management systems are installed and cash

management is supervised. As mentioned earlier, this revenue is allowed to be retained

by facilities and used to supplement salaries. The disincentive to improving these official

systems may be a worry that patients will not be willing to make informal payments if

they have paid official charges. This issue should be a priority for further analysis and

research.

III. Feasible Ideas for Remedying Vulnerabilities Actions to reduce vulnerabilities to corruption can be grouped in five main categories, as

shown in Figure 1.

14

World Bank. Preparation Mission. Second Poverty Reduction Support Credit. October 2002.

10

Figure 1: Anti-Corruption Strategies

Citizen Voice (“C”) includes actions like creating local health boards where citizens can

have input into the budgeting and planning, or Citizen Advocacy Offices where

complaints can be heard. Choice refers to competition from private sector providers, so

people can go elsewhere if they don’t like the prices & quality of government services.

These types of strategies were shown to decrease informal payments and procurement

prices in Bolivia.15

Information strategies (“I”) deter corruption by increasing accountability and

probability of detection. When people know they are being watched, they are less likely

to abuse systems, as shown in Argentina where hospital procurement prices paid went

down when the central government began collecting and reporting this information.16

In

addition, informed patients may be more likely to ask questions and can defend

themselves from abuse that preys on their ignorance.

Incentives for appropriate action and consequences for improper actions (“I&C”)

increase the penalty for corruption and the benefit of staying clean. Sanctions for

improper acts also can deter others from engaging in corruption as they will fear

consequences for themselves. Many health reform initiatives seek to improve incentives

by changing provider payment systems, and creating appropriate legislative frameworks

can increase the likelihood that corruption will be detected and sanctioned.

Appropriate discretion (“D”) includes changes in procedures to reduce discretion where

it is being abused (e.g., procurement decisions) or to increase discretion where it will

15

Gray-Molina, et. al., “Transparency and accountability in Bolivia: does voice matter?” Working Paper R-

381. Latin American Research Network. Washington DC: IADB 1999. 16

Di Tella and Savedoff, 2001.

Citizen

Voice &

Choice (C)

Anti-

Corruption

Strategies

Incentives &

Consequences

(I&C)

Information

(I)

Appropriate

Discretion

(D)

Management

Tools (M)

11

permit earlier detection of corruption or rewards for good behavior (e.g., facility

manager’s ability to sanction employees who skip work).

Finally, management tools (“M”) are essential to reinforce hierarchical control systems.

These may include such things as internal financial control systems, performance

auditing, and drug inventory systems.17

My recommendations include strategies in almost all areas since they are appropriate for

long term, sustainable progress. In the short-term, though, two strategies that may be

most appropriate for MSI/Albania are citizen voice and information. These are

strategies where civil society organizations have a logical role. Other USAID

collaborating agencies such as PHR Plus, RPM Plus, and Urban Research Institute may

be better placed to contribute to longer-term strategies such as developing management

tools and creating incentives. These latter categories are also more dependent on the

health reforms that are actually implemented in Albania.

Other ways to categorize recommendations that are also important include the degree of

implementation capacity required, and the amount of government commitment

needed. Figure 2 arranges specific anti-corruption recommendations by these two

dimensions. (The figures in parentheses refer to the type of anti-corruption strategy as

described in Figure 1.)

Figure 2: Strategies for Albania, by Level of Commitment and Capacity

Citizen representatives on committees

(C)

Procurement results monitoring (I)

Statements condemning informal

payments (I)

Develop performance standards,

management tools (M)

Increase provider compensation and link

pay to outputs (I&C)

Strengthen and enforce regulatory systems

(I&C, D) Disseminate pricing information (I)

Citizen Advocacy Office for Health (C)

Consumer guides to health laws and

system (I)

Promote awareness on informal

payments (I)

Trend analysis of drug prices and

affordability (I)

Research and analysis of data on informal

payments (I)

Citizen lobbying & advocacy for changes

in policies (C)

17

See R. Di Tella and W. Savedoff’s book for more detail of tools studied in Latin American hospitals.

Government

Commitment

High

Implementation Capacity

Low

High

12

In this section I will discuss seven of these strategies in detail, including all strategies

from the bottom left box (where I feel ACAC’s organization interest is strongest) and

three other strategies: research and analysis of data on informal payments, trend analysis

of drug prices and affordability, and citizen representatives on committees. Five

strategies are informational, while two focus on increasing citizen voice.

A. Disseminating Price Information

This addresses the complaint that patients are being asked to pay too much for drugs and

are being steered to certain pharmacies by their doctors (who may be receiving

kickbacks). One solution would be to require pharmacies to post the prices of the top 25

drugs in terms of sales volume. The ACAC could also design a poster listing patients’

rights regarding access to price information. The Mayor of Tirana is supportive of the

anti-corruption program and could be enlisted to require pharmacies to display the poster

and price list. MSI could enlist media to play a role: for example, a TV crew could visit a

sample of private pharmacies to test compliance, interviewing customers to see what they

actually paid. This type of exposure would put pressure on the MOH and the Insurance

Institute to control the private pharmaceutical sector.

B. Consumer Guides to Health Regulations and Systems Revised government orders and laws have been passed recently concerning medicines,

dentistry, private practice, health insurance, and professional standards for doctors (the

“Order of Physicians”). More proposed regulations and legislation is still under review

and waiting for passage. Even educated health professionals can be confused about these

laws and regulations, and what they mean. The ACAC has provided other citizen guides

to the Albanian judiciary system. Using this model, an educated lay person’s guide to

health regulation would be helpful. The publication should reference at least the

following important laws and orders:

Orders or laws covering private practice of medicine and ownership of related

businesses (e.g., pharmacies or ancillary services) by health employees working

in the public sector;

Orders that cover the system of “secondary payments” (official fee revenue);

Orders that cover the committees for drug selection and drug reimbursement;

Orders explaining the reimbursement policies for the health insurance institute;

Penal code related to bribes and gifts given to public officials for services.

A dissemination strategy would need to be developed, focusing first on health

professionals and health system stakeholders (both public and private) as the target

audience. The purpose should be to inform stakeholders and encourage them to

participate in policy debate. Plans would need to be made to update the publication at

least twice a year to accommodate progress (we hope) in health reform implementation.

C. Promote Awareness on Informal Payments

In conducting interviews and listening to contributions from participants at the workshop,

I realized that the problem of informal payments is not well understood in Albania.

There are many dimensions to the issue and it is generating a lot of concern, but each

13

Informal payments are an important fact of life in health care in central Europe. It is difficult to see how any of the much needed reforms can be implemented if these payments are not tackled explicitly as part of an integrated policy. As a first step, it is necessary to understand much more about their scale and scope, their contribution to overall health care financing, and their consequences for efficiency and equity. Governments in this region have ignored them for too long.

E.Delcheva, et. al. “Under-the-counter payments for health care:

Evidence from Bulgaria” (1997)

“Here there is the mentality that you have to give a reward to someone who gives you service.

For example, you give a tip to the barber who serves you. So much more grateful you must be to the doctor who saves you.”

Participant Health and Corruption Workshop,

Tirana, 3/03

person seems to see just part of the problem and from their own viewpoint. This is like

the problem of the mouse and the bird describing the countryside—it appears very

different depending on whether you look from the sky or the ground, but both views help

us to understand the same reality. It would be helpful to continue discussions and

dialogue on this topic, both among health professionals and among general citizens.

USAID and the ACAC should try to promote

discussion of issues, especially as more

household-level data become available to feed

into the discussion (e.g., the household survey

data from PHR Plus, and the data from the

Living Standards Measurement Survey).

Some discussion aids could be developed to

provoke deeper thinking on the issue. One

idea might be to assemble some short “case

studies” of informal payments based on actual

stories by patients. The cases could present a

step-by-step analysis of what the patient saw,

what motivated them, what they thought and did at various stages in the care-seeking

process. Using the case studies in a meeting, people can analyze where the

vulnerabilities to informal payment arose. This can help distinguish possible areas where

actions were influenced by asymmetrical information, as opposed to actions that seemed

driven by values and personal preferences or choices. Another possible strategy would

be to videotape a focus group with patients who have complaints about informal

payments, then show the tape to groups of doctors or nurses to stimulate discussion. Exit

surveys could be conducted and analyzed to provide more detailed information that could

then be presented to medical staff or doctors groups in sessions designed to inform rather

than point fingers. Annex 5 proposes a hierarchy of acceptable and unacceptable

practices regarding informal payments that could be used to provoke discussion, test

people’s assumptions and gain consensus.

The purpose of this “awareness strategy” is to promote

debate about informal payments. This will do two

things: first, it will clarify cultural practices,

motivations, and attitudes about informal payments so

that a consensus can be reached about what defines the

real abuses in the system. This can help policy makers

to design health reforms that are more likely to succeed

in reducing these practices. Secondly, the awareness

strategy will help to create a pressure from health professionals and ordinary citizens for

systematic government reform. With added pressure, the reforms may be implemented

more quickly.

Related to the recommendation about promoting awareness of informal payments, there

is a need for additional research on this topic, as described below. These two

recommendations are discussed separately because the research activities require a higher

14

level of implementation capacity, more resources, and more collaboration with other

agencies (such as the World Bank, INSTAT, or the Institute for Public Health).

D. Research and Analysis of Data on Informal Payments

Related to the activities mentioned above, there is a need for more research to inform us

about the practice of informal payments. Recommendations include:

1) Research on health reforms to reduce informal payments Many people believe that health reforms in Albania will reduce the practice of

informal payments. This assumption is based in theory and the evidence to

support it is not extensive. Several types of information may be helpful to

Albanian decision-makers as they consider this potential benefit of health reform

in more detail. First, it would be helpful to document how health reforms being

adopted in transition countries in Eastern Europe and Central Asia have affected

informal payments. Interviews with people working in the region and review of

unpublished literature could provide cautionary advice for Albania. Secondly,

Albanian decision-makers need to create a baseline against which their success in

reducing informal payments through health reforms will be measured. For this,

we need further documentation of the practice of informal payments, either

through household surveys or exit surveys. Coordination with collaborating

agencies (e.g., World Bank, Greek Government, PHR Plus) will be important as

such studies may already be planned or could be included within the scope of

current work. Once the data are available, an information dissemination plan

could be coordinated through ACAC.

2) Evaluation of Tirana Maternity’s intervention to fight corruption The main research question of this evaluation would be “Are rates of corruption

(informal payments, absenteeism, theft of supplies) lower in Tirana Maternity

Hospital when compared to other hospitals that have not tried so actively to fight

corruption?” Methods for conducting this evaluation could be exit surveys of

patients and perception surveys by category of staff (e.g., nurses, general practice

doctors, specialists). If results do show that Tirana Maternity has reduced

corruption, these lessons learned could be disseminated and used to guide policy.

3) Analysis of culture and corruption in Albania

Before we can begin to change attitudes and practices, we need to understand a

lot more about the motivations and beliefs that underlie them. Two cultural

factors in Albania that are important to overall anti-corruption strategies (not just

to health) include the tradition of gift-giving, and the practice of favoritism based

on family and kin. A study in Brazil study showed higher corruption levels in

municipalities where people in government had close personal ties or business

links, because then there was trust that people wouldn’t betray you.18

A similar

situation may exist in Albania. Some Western anti-corruption strategies may be

18

Rose-Ackerman. Corruption and Government: Causes, Consequences, and Reform. New York:

Cambridge University Press, 1999, pages 97-98.

15

based on underlying assumptions about individualism in self-interest that are not

accurate for this culture. Research on culture and corruption in Albania should be

practical and focused on developing informational messages likely change

attitudes and increase support for anti-corruption activities. For example, we may

learn insights about how to strengthen non-financial motivations of health

providers to help reduce informal payments. In addition the research should

inform policy makers on how to tailor the design anti-corruption strategies for the

unique social and political climate of Albania. I was not able to assess local

capacity for this type of research, but one NGO representative thought it was an

important topic and is going to check on local capacity for such a study.

One final remark about these research directions: several people mentioned to me that “it

is all different in primary care.” A weakness of this assessment is that I was not able to

observe primary care practices or assess the situation outside Tirana. People with more

familiarity with rural and primary health care issues may suggest ways to make

recommendations more generally applicable to settings outside the hospital and urban

sectors.

E. Develop a Citizens Advocacy Office for Health Concerns

The focus of anti-corruption activities in health should be to detect and try to remedy or

prevent the worst kinds of abuses. The positive experience of ACAC’s Citizen Advocacy

Office (CAO) is instructive in this matter. The office has been extremely popular and the

independent non-governmental legal professionals providing support on a pro-bono basis

have already responded to hundreds of citizen complaints. The name of the office is

recognized by the population and is associated with integrity and fairness.

Citizens with complaints about abuses by medical staff may be willing to report these

cases if a Citizen Advocacy Office were located near Mother Theresa Hospital (the

largest hospital in Tirana). The office would be charged with investigating and helping to

resolve cases of abuse; for example, extortion of payment or denial of care.

An added benefit of the Citizens Advocacy Office for Health Concerns will be more data

on what types of abuses are occurring and exactly how they take place. This kind of

operational detail will be very helpful to policy makers and planners of health reform and

decentralization programs. Once abuses are understood, the ACAC can help advocate for

changes in the law to address them.

F. Trend Analysis of Prices and Affordability

An informational strategy to help make drug selection, procurement, and pricing

practices more transparent involves analysis of prices and affordability of drug. This

methodology, developed by WHO and Health Action International, provides comparative

data on prices of common drugs by sector, including public facilities, private for-profit

facilities, private for-profit pharmacies, and private not-for-profit facilities. Local prices

are shown in relation to international reference prices, as shown in the column labeled

“Median MPR (Median Price Ratio).” Figure 3 below shows a sample report illustrating

16

the range of prices found in private sector pharmacies in Armenia. The report shows that

depending on the item, prices in Armenian private pharmacies are 1.8 to 95 times higher

than international reference prices.

Figure 3: Private Pharmacy Prices in Armenia

See slides from the Health and Corruption Workshop conducted on March 12, 2003 in

Tirana for more details on the methodology.

Price analysis can detect variation in prices that is not explained by local cost factors

(e.g., transportation, duties and taxes, wholesaler or retailer’s mark-ups, dispensing fees).

Local cost factors can make retail prices 100% higher than the manufacturer’s landed sale

price; yet in some countries sale prices have been reported that are 58 times higher. This

type of variation needs to be questioned, especially in the public sector. The pricing

methodology can help raise questions about irrational drug use and patterns of high sales

of drugs that are less affordable for patients. The methodology calculates the cost of

treatment for common illnesses, using standard treatment protocols that can be modified

for local situations. This type of study might be implemented in coordination with

existing USAID collaborating agencies with expertise in drugs and financial analysis.

G. Citizen Representatives on Committees

Citizen voice can be a very important check on behaviors and decisions taken by

government staff in the health sector. Right now it is not very well developed, and ideas

for how to promote citizen voice through advisory committees, local health boards, or

other structures need more discussion and thought. Everyone I spoke with was interested

in this area and many were planning to do at least some work here.

It could be enormously helpful to have a local group facilitate the sharing of experiences

and tools for promoting citizen involvement in health governance. MSI should consider

contracting with a local health NGO for this strategy. Activities would include creating

an inventory of related activities that have been supported by different agencies in

Albania (not just in health but in education or other sectors as well), and developing

models of local participation in decision-making for public health services with specific

roles and responsibilities for citizen committees. The models could then be circulated

broadly among stakeholders and discussed in meetings.

17

Other collaborators doing work here already include PHR Plus at the primary health care

level, and Tirana Maternity Hospital where the Director is interested in establishing a

health board or patient advisory committee.

IV. Implementation Capacity

In section III I have tried to identify different implementers for the strategies I am

recommending. The main implementation mechanisms I suggest are activities to be

undertaken by the ACAC (for example, opening a CAO for health concerns), small grants

to local health NGOs for informational strategies, and external or local technical

assistance contracts for some of the research and studies. MSI should consider

collaborating with PHR Plus for several of the strategies, in particular the pricing analysis

and work to develop “citizen voice.”

I have made relatively few recommendations for government action because I believe

that government is already involved in a lot of health reform work. Health reforms

(especially some in the upper right box of Figure 3) include anti-corruption strategies

working through incentives, management tools for better hierarchical control, and

appropriate discretion of decision-makers. PHR Plus and Urban Research Institute are

also working in this area. It might be helpful for these CAs and government

representatives to meet with MSI on a regular basis to review Figure 2 and share

information about progress being made on the different strategies. The Project

Coordination Unit of the MOH may be a good point of entry.

It will also be helpful for MSI to work with the Order of Physicians and Tirana Maternity

Hospital. Tirana Maternity Hospital may be willing to pilot test some of the management

tools being developed by the PHR Plus project (such as the Health Information System

with patient encounter form, and the exit survey methodology) for adaptation to hospitals.

The hospital can also promote dissemination of these management tools into government

structures.

Other stakeholders who may be important advocates for anti-corruption activities in

health include the Medical School Student Association and Faculty Council.

V. Estimated Resources and Next Steps It is difficult to estimate resource needs without consulting with collaborators, but I have

provided some rough estimates of level of effort and implementation steps below. (Level

of effort refers to full-time staff needed. The activity may actually take longer than this

to implement due to schedules, lag times and other activities that are being done

simultaneously.

A. Dissemination of Price Information. (ACAC, MSI) LOE: one month. Steps:

Develop content, design and print poster, coordinate with Mayor’s office to

disseminate, arrange television crew to test compliance. Costs: staff time, poster

printing, transport for dissemination to pharmacies, subsidy for TV crew if needed.

18

B. Consumer Guides to Health Regulation. (ACAC, MSI) LOE: two months. Steps:

Develop plan for contents of the guide, circulate plan for review and comments,

collect most recent versions of laws and orders, write consumer guide, print guide,

disseminate. Costs: staff time, printing, postage or other distribution costs.

C. Awareness on Informal Payments. (ACAC, MSI, external consultant, local NGO)

LOE: two months. Steps: Create awareness strategy and plan, develop discussion

aids (case studies, video tape, analyses of existing data), hold meetings and

discussions, evaluate changes in knowledge, attitudes. Costs: staff and consultant(s),

video production, meeting expenses, per diem expenses of external consultant.

D. Research on Informal Payments. (External and local consultants, PHR Plus, World

Bank, other local collaborating agencies possible) LOE: three months or longer,

depending on study or studies selected. Steps: Develop study protocols, research

objectives, methods, obtain approvals, collect and analyze data, design information

dissemination plan, hold meetings and discussions to disseminate findings. Costs:

staff and consultants, local survey expenses, enumerators, local travel, per diem

expenses of enumerators and consultants.

E. Citizens Advocacy Office for Health. (ACAC, MSI) LOE: three months. Steps:

Obtain approvals, research and select location, develop operational plan, open and

operate office, analyze data on complaints to determine categories and trends. Costs:

staff time, office expenses, legal research.

F. Trend Analysis of Prices and Affordability. (External or local consultant, Institute

of Public Health, INSTAT) LOE: three months. Steps: Design study, select

facilities and pharmacies for measuring prices, select drugs, collect price data,

measure affordability, identify drug price structure components, analyze data, design

strategy for public disclosure of results, develop continuous monitoring plan. Costs:

staff and consultants, survey expenses, enumerators (should have pharmacy training),

local travel, per diem expenses of enumerators and local or external consultants.

G. Citizen Representatives on Committees (ACAC and MSI through a grant to local

NGO, PHR Plus) LOE: one to two months. Steps: Create inventory of ideas and

current activities related to citizen role on advisory committees and boards in any

sector, develop models for local participation in decision-making for health, hold

meetings to review/discuss, revise models, review current membership on national

drug committees, advocate for more citizen input/oversight, advocate for objective

review of decisions made by these committees. Costs: staff time, meeting expenses,

NGO grant.

19

Annex 1: List of Contacts

Washington, DC

Philip Goldman, World Bank

Akiko Maeda, Senior Health Economist, World Bank

Gero Carletto, World Bank (LSMS Albania)

Butch Staley, Principal Program Associate, RPM Plus Project

Dan Krashaar, Director, BASICS II Project, USAID

Amsterdam

Henk Ter Avest, Hospital Director and International Consultant

Albania

Carlos A Guerrero, MSI Country Project Director in Albania

Fatbardh (Bardi) Kadilli, MSI Consultant

Eric Richardson, USAID Democracy & Governance Officer

Pamela J. Wyville-Staples, USAID General Development Officer

Suzana Cullufi, Democracy and Governance, USAID

Zahneta Shatri, MD, Health Specialist with USAID

Matilda Nonaj, Action Plus

Belioza Coku, Children’s Future and Development Association (CFDA)

Leila Pernaska, Organization for the Protection of Women and Children (OPWC)

Minister of Health, Xhani

Deputy Minister of Health, Petrit Vasili

Lulzim Ndreu, Director of Law Department, MOH

Vasilika Xhafa, Head of Licenses Department, MOH

Tomi Melo, Head of the Project Coordination Unit, MOH

Saimir Kadiu, World Bank Project Management Unit at MOH

Christopher Bladen, Consultant, USAID Design team

Alejandro Collado, MD, Poliklinika Lui Paster

Halim Kosova, MD, Director of Tirana Maternity

Arben Cavolli, Deputy General Director, Health Insurance Institute

Silva Bino, Director of the Public Health Institute

Alban Ylli, MD, Deputy Director of the Public Health Institute

Mihal Tase, MD, Director of University Hospital Center “Mother Theresa”

Jan Valdelin, COP, Partners for Health Reformplus Project

Elda Dede Alsalihi, Technical Officer, Partners for Health Reformplus Project

Milva Ekonomi, Director of INSTAT

Edlir Vokopola, Urban Research Institute

Albana Dhimitri, Urban Research Institute

Santino Saveroni, WHO

Zamir Muça, Albanian Red Cross

Dine Abazi, Order of Albanian Doctors

Luzhiana Abazj, Executive Director Tirana Regional Public Health Authority

Arbeu Luji, Policy Department, Tirana Regional Public Health Authority

Aida Myzyri, Economics Department, Tirana Regional Public Health Authority

Yllka Hida, Health for All

Elida Collaku, Head of Pharmaceutical Department

20

Annex 2: List of Documents Consulted Albanian Coalition Against Corruption, “Action Plan” September 2001 to September 2002. Dated

September 21, 2001.

Center for European Constitutional Law, “Report on the Albanian Health System and Proposed Reform

Plan.” Athens, December 2002.

Di Tella, Rafael and William Savedoff, eds. Diagnosis Corruption: Fraud in Latin America’s Public

Hospitals. Washington, DC: Inter-American Development Bank. 2001.

European Observatory on Health Care Systems. “Health Care Systems in Transition: Albania” 1999.

Fairbank, Alan and Gary Gaumer. Organization and Financing of Primary Health Care in Albania:

Problems, Issues and Alternative Approaches. PHR Plus Project. January 21, 2003 draft version.

Government of Albania. Albania Poverty Reduction Strategy Paper. November 2001.

Government of Albania, “Action Plan for the Prevention and Fight Against Corruption, 2002-2003. Tirana,

July 2002.

Gray-Molina, et.al. “Transparency and accountability in Bolivia: does voice matter?” Working Paper R-

381. Latin American Research Network. Washington, DC: Inter-American Development Bank. 1999.

Group of States Against Corruption, Council of Europe. First Evaluation Round, Evaluation Report on

Albania. Adopted by CRECO at its 12th

Plenary Meeting, Strasbourg, 9-13 December 2002.

Kosova, Halim. “Opinions and Results on the Fight Against Corruption in the Health Sector.” Obstetric-

Gynaecological University Hospital of Tirana. July 20, 2002.

Klitgaard, Robert. Controlling Corruption. Berkeley, CA: University of California Press. 1988.

MOH/WHO/World Bank. “Inventory of Externally-Financed Projects in the Albanian Health Sector.”

Produced for the International Health Sector Conference in Albania 2002. Tirana, January 22, 2002.

Miho, Vasil. “Corruption in the health sector.” WHO Liaison Officer, Tirana-Albania. 2002 (11 pages).

Ministry of Health, Republic of Albania, “10 Year Development Strategy of the Albanian Health System.”

Year 2002.

Order of Physicians of Albania, National Council, “Code of Medical Ethics and Deontology along with

Other Main Documents for the Functioning of the Order of Physicians.” Tirana, 15 June 2002.

Partners for Health Reform Plus Country Work Plan, December 2002.

Rose-Ackerman, Susan. Corruption and Government: Causes, Consequences and Reform. New York:

Cambridge University Press, 1999.

Savelli, Anthony and Marina Semenchenko. Rational Pharmaceutical Management Plus Program, Albania

Reconnaissance Trip. Arlington, VA: RPM Plus Project, September 22-October 3, 2001.

Vian, Taryn. “Corruption and the Health Sector.” Washington, DC: MSI. November 2002.

21

World Bank. Report of the Preparation Mission for the Albania Second Poverty Reduction Support Credit.

October 15-24, 2002.

World Bank Albanian Health System Recovery and Development Project. “Qualitative Stakeholder

Assessment of Healthcare: Access and Utilization in Low Income Communities. Terms of Reference.”

November 2002.

World Bank. Albanian Public’s Perceptions of the Health Care System. September 2000.

22

Annex 3: Workshop on Health and Corruption Hotel Mondial, Wednesday March 12, 2003

Workshop Output

Over 25 participants from the Albanian Government, MSI, USAID, partner organizations

and civil society attended the three-hour workshop. After introductions, Taryn Vian gave

a presentation of vulnerabilities in the health sector in Albania, followed by a

presentation of some strategies that may prevent corruption (Power Point Presentation of

15 slides with notes pages may be obtained through MSI/Albania office.)

Next, small groups were asked to consider the problem of informal payments. Three

working groups discussed the motives, needs, perceptions, attitudes, and factors creating

resistance to change from the viewpoint of 1) patients, 2) medical providers, and 3)

administrators. These groups then reported out. Also, Dr. Kosova from Tirana Maternity

gave a prepared statement on fighting corruption in the health sector based on his

experience.

Some of the issues that arose from the groups are presented below.

Group 1: Patients

--Motive for patients is to have quality health care services for selves and family

--Patients want to have “ethical medical staff”

--Patients want to be cured as quickly and for as low cost as possible. They don’t want to

stay long in the hospital as they lose work days. They want to reduce unnecessary

doctor visits since they can see that this makes them poorer because they pay the

specialist and lose work time

--Patients think they need to give gifts

--They want to get good quality and lower their length of stay

--Other patients recommend certain doctors to them, for example “You can go to x doctor

for excellent care at a low price” (referring to the under-the-table payment), so there is

more demand for doctors with good quality and low price

--Poorer patients, especially, can have problems communicating with physicians

--Some patients come to hospital after having tried traditional (herbal) remedies

-- Patients know little about services. They are not aware of their rights and obligations.

They may not know how to complain about delays and problems related to quality.

Patients aren’t aware of the Order of Physicians (medical association charged with

handling complaints about doctors).

--Attitudes of patients are different, but most do not want to complain to authorities or the

Ministry of Health. When ministry staff go to the patients and ask for their complaints

the patients say nothing, no one will give a complaint. It is like they are not

empowered to complain. They are unwilling and feel they cannot. They also lack

information about where to complain and how to follow-up when they do complain to

make sure something is done.

--Doctors sometimes neglect the services they need to provide to patients.

23

--Patients don’t know about health insurance systems, what services should be free and

how insurance is money they have had deducted from their salary over time.

--Make the public aware that they pay for health insurance. Expand list of reimbursed

drugs.

--Informal payments are due to physicians asking for it.

--In this culture you need to give a gift and it is sometimes like a “pre-payment” because

you’ll need a doctor next time.

--Other times the payment is not a gift but is somewhat forced because the doctor says

you need a test and there are secret arrangements between a physician and private

diagnostic companies.

--Need improved budget management at all levels—the ministry and hospital level—this

would improve revenue collection from official fees and would therefore allow

incentives to be paid to staff (then they wouldn’t need informal payments).

--There should be price lists and information for patients.

--Recommend establishing an office of complaints.

Group 2: Medical staff

--Doctors’ motive is that pay is very low.

--There is excessive polarization of society. Some are very rich and some are very poor.

Some of the poor want to try to reach the rich through informal payments. Doctors

have envy of the rich with nice cars, houses on the beach. They want to have this.

--The rich want different services than the poor and are not afraid to offer money for this.

--It is inequities and unfairness that lead to informal payments

--Here there is the (primitive) mentality that you have to give a reward to someone who

serves you. For example, you give a tip to the barber who serves you. So much more

grateful you must be to the doctor who saves you.

--We have to distinguish between these two motivations

--Have to view corruption also in the social and economic context. It is a top to bottom

phenomenon. When you are looking at a Minister who gets informal gains, a physician

will be stimulated to accept informal payments too, to augment salary.

--Sometimes the facility is collecting official fee revenue (secondary payments) but it

doesn’t go to the doctors. There is not monitoring or control of where it goes.

--Lack of accountability in holding medical staff responsible, lack of monitoring.

--Medical staff increase the length of stay of patients to get more money

--There are incentives in a system for the patient to bypass the existing referral system. If

the patient follows the proper system there is a risk that it will be more expensive: they

must go to the clinic and see the general practitioner (pay), they might get referred to a

specialist in the same clinic (pay again), then they may get referred to a specialist at the

hospital (pay again). Instead, if they go directly to the hospital and pay under-the-table

they avoid probably a lot of other payments.

--Recommend developing accreditation systems for facilities and licensing of doctors,

then using these systems to hold the facilities and systems to standards. We can

dismiss the doctors who are not performing up to standards. There is legislation

needed.

--Need to increase the rewards for medical staff.

24

--Need the health insurance system to finance the purchase of services by patients

Group 3: Administrative Systems

--need to cover everyone with health insurance

--need for increased management capacity of health leadership

--data analysis of cost information can highlight important differences between

institutions and can encourage better performance

--procurement reform is needed, including reference price information sharing

--list of reimbursable drugs needs to be improved

--secondary payment systems can be improved to increase revenue collection and give

this back to doctors as motivational payments

--monitoring systems can provide additional control the work of doctors through

information from customer satisfaction surveys, exit surveys.

--the informal payment system is so accepted that doctors leave at the end of the day and

turn to each other to ask “How much did you make today?”

--although patients are reluctant to complain about it to the doctors, they will get angry

and disillusioned when they leave the facility, and they lose confidence in the system

25

Annex 4: Comparative Data on Informal Payments in Eastern Europe and Central Asia

Sources: All data except the second Albania study are from Maureen Lewis, Who is

Paying for Health Care in Eastern Europe and Central Asia? (Washington, DC: World

Bank, Human Development Sector Unit, Europe and Central Asia Region. 2000). Data

points for Albania are from:World Bank, Albania: Growing Out of Poverty 1997 (data

from 1996, cited in Lewis’s paper), and World Bank, Albanian Public’s Perceptions of

the Health Care System September 2000 (data from 2000).

Frequency of Informal Payments in Selected Countries

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Armenia (1999)

Vietnam (1992)

Albania (2000)*

Poland (1998)

Azerbaijan (1995)

Kyrgyz Republic (1996)

Russian Federation (1997)

Moldova (1999)

Tajikistan (1999)

Slovak Republic (1999)

Latvia (2000)

Albania (1996)*

Bulgaria (1997)

26

Annex 5: Hypothetical Model of Perceived Acceptance of Informal Payments, by Type of Activity

Real data on perceptions of patients and staff could be used to create a hierarchy of

acceptable and unacceptable practices using a model such as this one. This information

is helpful for developing social marketing strategies and informational messages meant to

promote behavioral change.

Staff accepting voluntary

under-the-table payments so

that health workers earn a

living wage.

Staff accepting voluntary

thank you gifts after care is

delivered.

Staff requesting voluntary

under-the-table payments in

exchange for better quality

care.

Staff accepting voluntary

under-the-table payments in

exchange for better quality

care.

Staff threatening to deliver

lower quality care unless

under-the-table payment is

made before treatment.

Doctors accepting voluntary

thank you gift before care is

delivered.

Staff accepting payments so

that they can have fancy cars

and beach houses.

Acceptable

Highly

Somewhat

w

Unacceptable

Staff refusing to treat patients

without under-the-table

payment.

Staff giving lower quality of

care to patients who did not

make an under-the-table

payment.