When the passengers in a taxicab begin chatting about the new universal health insurance plan in Taiwan, the taxi driver, unable to contain himself, jumps into the conversation, pouring out his grievances at length. His child suffers from asthma. Under the former veteran's health insurance program, as soon as the child fell ill, they would head straight to Veterans' General Hospital for an examination. They had already accumulated a long case history. But he was surprised to discover that with the enactment of universal health care, a new "medical referral" system was put into place in which patients must first obtain written proof that their illness cannot be treated at a smaller clinic before they can be admitted to large hospitals. So now the taxi driver must take his child to a clinic before proceeding to Veteran's General; otherwise, he will be burdened with considerable extra fees.

"It's not that I never used to go to clinics. But either the clinics didn't have the medicines, or they had no effect. Now when we go to Veteran's General, we have to spend more money. But what really makes me angry is that before we could get enough medicine to last a month, but now they say it's a transitional period and--can you believe it?--we can only have three day's worth. It wears me out running back and forth!"

In the emergency room, one patient's relative was equally indignant. After his aging father suffered a stroke, he was taken to the hospital a number of times. During these days, the old gentleman seemed to develop symptoms of kidney inflamation. But the hospital would not admit his father, giving such reasons as "No beds are available," and "We don't accept patients with chronic illnesses." He could only stormily complain to everyone he met, "Universal health care has already been put into effect. How can hospitals still refuse patients?"

Universal health insurance benefits those who originally had no insurance, but the burden on those who already had insurance is correspondingly heavier. Of these, blue collar workers have protested the most loudly. The photo shows a workers' protest march.

The great health care sprinkler system

Not long ago, universal health insurance was still a good public policy dreamt of by the whole population. The large sector of the population which in the past had no access to insurance could finally receive a respite. Nevertheless, when the system was put into effect in March, everyone, patient and physician alike, seemed unable to adapt. The people complained that insurance premiums were too high. In the past an insurance policy allowed for free treatment; now it has for no apparent reason taken a leap upward in cost due to the "partial cost sharing" regulation. And in the past you could go directly to a hospital to see a doctor with a good reputation for something as simple as a cold; now with the medical referral system, you can't get through the front door.

On the other hand, medical institutions protest that the National Health Insurance Bureau (NHIB) offers insufficient sums of money. The China Medical Association has taken the lead in refusing to sign contracts with the NHIB. It is not uncommon to hear of hospitals inventing extra fees to make up the difference.

When the various conflicts surrounding the health insurance system became a hot topic of discussion, most people probably overlooked one basic fact: The universal health care plan is actually only a financial design, and its goal is to eliminate "loss and waste" from the vast health care system. As for actual medical service, one still must look to the same health care network of medical centers and personnel that is already in place. The problems that presently exist--for instance, that people on the smaller offshore islands must pay insurance premiums, even though they do not have access to physicians; that citizens are unwilling to participate in the medical referral process; and that patients with chronic illnesses have difficulties finding access to treatment--are problems which should not crop up in a well organized health care network. Perhaps we should remove ourselves from the tumultuous controversy and seek an objective perspective: Judging from Taiwan's current distribution of medical facilities, equipment and personnel, can we support the burden of universal medical insurance? And what quality of medical treatment can be provided?

"If universal health insurance is a water distribution system, then the health care network is the water pipes," says DPP legislator Shen Fu-hsiung, who has a medical background. The water distribution system controls the direction and allocation of running water (money), but if a good water pipe structure is lacking, then the water won't be carried to the fields, even if the distribution system is very good. Conversely, despite the fact that the water pipe networks still leave something to be desired right now, after the waters have been released, over a certain period of time there is still the possibility that they will run their course, and that the barren land will be irrigated.

Comprehensive Medical Care System.

A balance between city and country

In fact, the government made preparations for this matter. Starting in 1985 the health care network was listed as a major nationwide development project, which entailed a long-term plan, divided into three phases to stretch over 15 years. The network would be linked up with the insurance system only after completion of the health care network project in the year 2000. But the insurance system was started ahead of time under widespread pressure, while the health care network plan was still in the second phase (1991-1996).

"With Taiwan's medical care standards five years ago, it would have been absolutely impossible to initiate the insurance system. But current situations can basically meet the needs," explains Yeh Chin-chuan, general manager of the National Health Insurance Bureau, who used to administer the health care network during his term as director of the Executive Yuan's Department of Health (DOH).

National Yang Ming University professor of public health Lan Chung-fu, who was the first to put forward a plan for health care network development, indicates that medical resources are precious and limited, and the main spirit of a health care network plan is: to reasonably distribute medical resources, to avoid inadequate supplies and to curb waste.

In terms of treatment of acute disorders, on the one hand, it is necessary to lessen the disparity between urban and rural areas; on the other, a hierarchical medical care system must be developed, including basic medical care that covers the greatest possible area, second-level local medical care, and top-level regional hospital-centers (RHCs) and subdivisional hospital-centers (SHCs), where complicated technology is a staple. The goal is delegating small hospitals for small ailments and big hospitals for big ailments. Aside from the network's structure, early preventive medical care, follow-up rehabilitation, and care of chronic diseases are of equal importance. Only with the three programs in balance can they bear the heavy burden of universal health insurance (see Chart 1).

Limited in terms of transportation and population, remote mountain villages and offshore islands may not be able to support a professional physician. But with such means as mobile medical vehicles and telemedicine, which have been in operation for some years, most illnesses can be handled. （photo by Cheng Yuan-ching）

No "doctorless village"

In terms of the average distribution of medical resources among urban and rural areas, Taiwan's current efficiency provokes a sense of pride. In the 63 health care districts throughout Taiwan, which are divided according to commuting patterns, only nine districts still fall in the category of "lacking medical resources." Most of these are remote mountainous areas or offshore islands. This constitutes a significant improvement from when health care network development was instigated, when 17 districts had insufficient medical resources.

In addition, the disparity between each health care district is on the decrease. For example, in terms of doctors per 10,000 people, the highest district, Taipei, has 2.17 times as many doctors (15) as the lowest district (Miaoli, with 6.9). The disparity has been reduced a lot since development began, when the ratio of the highest (Taipei) to the lowest (Yunlin) was 2.91 (see Chart 2).

After the insurance system was initiated, many people in mountainous areas or offshore islands complained, "We hand in the insurance premium like other people but cannot enjoy the same medical service." In response, Yeh Chin-chuan explains that because of insurmountable geographic barriers those areas are beyond their reach. But even though high-level medical technology can't be provided on location in these remote districts, where populations number in the hundreds, combined medical assistance should be sufficient, through telemedicine, mobile medical care, and public-sponsored rural physician visitation services, all of which have been carried out for many years, as well as the backup system of offshore military medical services.

Yeh Chin-chuan also states that after the universal health plan was initiated, standard physician fees in remote areas began to cost NT$20 more than in ordinary regions. This is in anticipation of navigating medical resources in a fairer direction by financial means. Currently, in the Penghu area as a whole there are 32.6 ordinary hospital beds per 10,000 people, which is even higher than the rural districts of Taoyuan, Hsinchu, Nantou and Yunlin in the interior of Taiwan island. After hearing the explanation from the NHIB, one citizen of Penghu expressed that considering the efforts being made, he felt the insurance plan was "not satisfactory, but still acceptable."

On the average the disparity of medical treatment between urban and rural communities has gradually decreased since the medical network plan was implemented. But creating a hierarchy of health care among the various hospitals is not such an easy task. The first step to establishing a hierarchy of medical services was the medical referral system, which was suggested a number of years ago in the health care network. This, however, interferes with people's habits in terms of which doctors they go to see, patterns not easily altered. After the universal health insurance was implemented, the medical referral system, buttressed by ample financial power, went into an experimental phase. But wave after wave of strong suspicion and opposition have been thrown up against the program. This has forced the NHIB to initiate the "transitional step" of simplifying the referral system from having four levels to only two, and doing away with extra fees for those who have no referral slips, until the population can become accustomed to the referral system. Whether the plan can be fully implemented is yet unknown (see Chart 3).

Regional Disparity of Physicians Before and After Implementation of Health Network Plan.

Special case registration--who benefits?

"If the referral system can not be strictly implemented, not only will it drag down the finances of the universal health system, it will negatively influence the quality of health care service," says National Taiwan University Graduate School of Public Health professor Wu Kai-hsun, shaking his head. He has long been involved in setting up the health insurance system.

In terms of financial costs, according to the payment records of the former labor insurance program, the average payment to hospitals (including regional hospital-centers, subdivisional hospital-centers and local hospitals) for each outpatient treatment is about NT$700, far higher than the average payment of NT$250 for general practice clinic services. High-level hospitals are in contact with a greater number of patients with rare disorders, and the many special examinations, treatments and rare medications create greater expenses. For example, kidney dialysis costs NT$4000, and a computerized tomographic scan costs about NT$4800. Nevertheless, many folk travel from faraway villages to cosmopolitan medical centers with the mentality that "you have to make the trip worthwhile" and "I need reassurance." They often implore the physician to make any number of miscellaneous tests.

Under such circumstances, if doctors don't perform their watch-guard duties, it is easy to think, "The hospital purchased all this million-dollar equipment; how can it be of value if we don't make more use of it?" It is far too easy to utilize these expensive machines indiscriminately. During the era of labor-insurance-subsidized health care, 70% to 80% of the large hospital outpatient clinics were known to commonly make excuses in order to request payments with "specialized case" declarations. This was also an indication that 70% to 80% of patients going to these hospitals requested the use of pricy technology. But most of these claims could not stand up to scrupulous review and inspection.

"According to statistics of other countries, actually more than 70% of patients can get adequate care from general practice clinics. Less than 30% really need to be referred to hospitals for checkup and treatment," says Yang Han-chuan, director of the Bureau of Medical Affairs at the Department of Health. Taiwan has an outpatient influx of people which has been referred to metaphorically as the "central market," and "the eighth wonder of the world." Taiwan also has an excess of expensive medical equipment and medication for a population of its size. These are all heartbreaking wastes of resources. If people don't change this tendency to squander, it will become a bottomless hole no institution of insurance or finance can afford. The massive deficit of the former labor insurance program is a lesson from the not-so-distant past.

Regional Disparity of Hospital Beds Before and After Implementation of Health Network Plan 1995 estimate includes those which were certified but not in operation as of June 1994 Note: Target number for the second phase of the health care network is a minimum of 20 ordinary hospital beds per 10,000 people in every medical region.

Giving the referral system a rebel yell

Other problems exist in terms of the quality of medical service. When going to see doctors in big hospitals, the patients have to face the famous "three longs and two shorts"--they must endure long waits for registration, consultation and medication, but they can only have two short minutes talking to the doctor, which makes raising the quality of medical care a difficult task. Furthermore, medical resources have long been concentrated in large hospitals, which leads to the unusual phenomenon where large hospitals get bigger and bigger, while small ones get smaller and smaller. And advanced medical technology is ever more concentrated in large hospitals, while general hospitals become ill-nourished and backward with regard to technology. Such an imbalance between the standards of various levels of medical centers is one major target that health network reform addresses.

The medical referral system has just been put into action. And the reverberations of people's protests are continually mounting. However, if we check the results, we will find out those who actually abide by referral regulations are limited in number.

For example, at National Taiwan University Hospital, the standard outpatient treatment fee became NT$210 when the referral system was introduced at the beginning of April. This figure is much higher than the cost at general practice clinics. Before the implementation of the insurance system, the number of outpatients per day at the medical center was about 5300. Now the number still hangs around 5000. Less than 200 of these actually possess a referral slip from a general practice clinic. Subtracting the number that have certificates for major illnesses or on-going treatment, or are going to the family medicine department, which doesn't require referral, the total of referral miscreants is still immense. However conservative your estimate is, about half the people would rather fork over a high fee than go to a lower level clinic.

What leaves people not knowing whether to laugh or cry is that some large private hospitals are not willing to give the lucrative outpatient business to general practice clinics. So they openly defy the insurance system policy; they even stick up posters on the walls of hospital corridors which read, "Come directly without referral--it's economical and convenient!" This has actually drawn in a lot of people who had been hesitating at the sidelines.

Whether the referral system is a failure or a success is hard to conclude right now. What's relatively more effective is to increase the cost of emergency treatment by as much as NT$420, so that "the number of those who simply come to big hospitals and register for emergency treatment when they have a minor affliction or simply because they are too lazy to stand in line will drop off," Yeh Chin-chuan says rather assuredly.

Outpatient Medical Costs Paid by Insurance Holders Under the Universal Health Insurance Plan Source: National Health Insurance Bureau.

Will the water forge its own channels?

Why is it that people are not intimidated by a large personal financial burden and are superstitiously dependent on large hospitals? Taking a trip to a hospital it is easy to discover that everyone believes they are in the right. They may have different reasons, but many are regular attendees at large hospitals. It's a hard habit to break. And many harbor such doubts as, "I have all my personal medical history here. Should I really have to go to a basic-level clinic and start all over again?"

With regard to this, some scholars early on suggested that medical histories, being a precious medical resource and crucial to human life, should be transferred along with the person, and should not be locked within the hospital. Ideal as this suggestion may sound, medical centers maintain the hesitant mentality of "if personal medical history is really opened up, won't there be endless medical controversies?" Such a measure is hard to put into effect.

On the other hand, whether or not it is out of misunderstanding, the mistrust the general public harbors toward general practice clinics is indeed deeply rooted. After the referral system is executed, Y.C. Chuang, director of the Chang Gung Memorial Hospital administration center, where the number of outpatients is on the increase, states that naturally there are a lot of good physicians in general practice clinics; the problem is that there are doctors whose medical ethics and skills are slightly inferior. "Uneven quality" is one of the main reasons why the general public does not want to put their own health at stake.

Wang Jung-shu, president of the Taipei Medical Association, thinks that "in the past with a thin little labor insurance chit, people could choose to go to 'five-star' hospitals and enjoy a wide selection of 'checkup feasts.' Naturally, they would show a lack of interest in simply equipped clinics, where they are served with a mere stethoscope. Currently, in addition to making some adjustments by means of the universal health insurance financial apparatus, general practice clinics are striving to upgrade themselves."

Chang Chin-un, a designer and consultant for several large hospitals and president of the Hospital Association of the Republic of China, points out a direction which is concrete. Group-practice clinics should be established to draw in patients with a stronger line-up of physicians and advanced equipment, as well as striking up a cooperative relationship with large hospitals, further strengthening a bilateral referral system. He also suggests establishing "half-open system hospitals," along the American model, which specialize in offering equipment and locales for use by licensed physicians. These are all worthwhile efforts for the future. There is a direction in which to proceed, but remodeling the structure will be no easy feat and will take a long time to accomplish.

Before the essential referral system had yet to be fully established, however, the insurance system was hastily commenced. Put another way, the water supply was opened up before the pipelines were successfully completed, at a time when the existing channels could not handle the current, when in fact new pipelines needed to be laid. Will the water ultimately forge its own channels? Or will it provoke an overflow of complaints and cause the pipes to burst? At what level of pressure should the water apparatus release its flow?

In view of these doubts, the DOH announced that the medical referral system's original four levels will be simplified, and extra fees will no longer be levied on those without referral slips. Inevitably people in the medical community are beginning to wonder if the referral system exists in name only. But Yang Han-chuan confidently asserts: "The referral system will still go into effect. It's only that it will not enforce enactment with the financial mechanism of increasing individual fees. Instead, it will be implemented through peripheral, supporting systems." Yang Han-chuan believes that the time scale will be a little longer, but it will have a more stable base. In the long term, its results will be better.

The medical referral system, in which minor illnesses are treated at smaller clinics and major afflictions at large hospitals, is based on the best of intentions, and it can reduce the misuse of medical resources. On the one hand, it requires the cooperation of the people, but creating a good referral system is a pressing matter.

Where can the chronically ill find rest?

Another leak in the health network that currently has no solution and involves a great deal of complications is the follow-up care system, including rehabilitation; care of the chronically ill, the severely disabled, the mentally ill, and terminal cancer patients; as well as in-home care and daytime hospitalization. Especially important are the many aged and fragile disabled persons who do not have medical insurance. They have long been waiting for public health insurance to begin, and they all want to rush to the hospitals to enjoy the medical care that in former times they could not afford to dream of.

Clear regulations as to payments for chronic illness are provided for in the insurance plan's regulations; nevertheless, incessant conflicts occur over the criteria for what qualifies as chronic illness. But beyond these issues, a more ironic question lurks: Where are the hospital beds for the chronically ill to sleep in? Nobody knows. Like cats on a hot tin roof, those patients have no option but to rush to occupy the few beds that are reserved for acute disorders. They then become a thorn in the side of most hospitals that is not easily extracted.

Chang Gung Memorial Hospital, for example, has suffered a relatively devastating impact from this phenomenon. When universal health insurance was just being implemented, the hospital was unsuspecting of any such problem. By the time they discovered it, it was already too late; Chang Gung was "invaded" by a wave of patients with chronic diseases. In the past, the hospitals could maintain patients with chronic illnesses at a ratio below 5%, but today the number has swollen to 14%. And once they have been admitted, it is difficult to discharge them. Chronic illness includes stroke-induced paralysis, pathological changes to the liver and kidney, and rheumatoid arthritis. Patients with those afflictions cannot possibly get well and leave the hospital within a short period of time. As a result, those patients who are actually in urgent need of hospitalization cannot find a bed covered by insurance (ie., in common rooms with three or more beds). They end up being forced to pull money from their own pockets and take expensive hospital beds not covered under the plan.

"Hospitals that can handle emergency cases have various first aid equipment and instruments, so the cost of establishing every bed is as high as NT$4 to NT$7 million. The expensive equipment is not utilized accommodating chronically ill patients who only need regular medication and don't need any special treatment. Won't the hospitals suffer big losses?" says Y.C. Chuang, who becomes visibly agitated when talking about this problem.

On the other hand, the NHIB has to pay according to the standard of emergency beds for those patients with chronic illness who take up emergency beds (NT$780 per day for a bed in medical centers, twice as high as that for a bed for chronic illness). The Bureau is being "ripped off" too. As to the future conflicts over emergency beds being occupied by patients with chronic illness, at this moment when both the medical community and the NHIB are in dire straits, nobody has yet discovered a means to resolve this problem.

In the past small local hospitals had relatively few hospital beds and little economic prowess. In the future they may be able to go the route of group-practice clinics or chronic illness treatment centers, in order to use resources more rationally.

Stand firm, and wait on the sidelines

Actually, "Where can the chronically ill go?" is an old question. Universal health insurance merely caused a deeply rooted problem to explode. Take Chang Gung Memorial Hospital for example. Its Linkou branch has long had a chronic illness treatment center in the works, but it has been bogged down in the process of altering zoning regulations, and construction has not been allowed to begin. In addition, the payment rates set up by the National Health Insurance Bureau for chronic illness hospital beds is barely over $300 per day, a level that many people consider unfairly low. This decreases the incentive for the medical community to set up facilities for the chronically ill.

On the other hand, although the NHIB knows the payments for hospital beds are too low, due to the fact that excessively high fees for special treatment have in the past "been impossible to push down," they are not willing to quickly raise the payment level. With both sides stubbornly standing their ground, patients with chronic illnesses continue to receive merely nominal payments. They may indeed have to wait a long time for a bed designated for their use.

"The medical care system for chronic illnesses is certainly a weak link in the chain," indicates Yeh Chin-chuan. The DOH did not begin to encourage the private sector to establish hospitals for chronic illnesses until 1991. Up to the end of 1993, there were only 20,000 beds reserved for chronic disease patients nationwide, half of which were for psychiatric patients. Only 4,450 hospital beds are set aside for the more than 60 kinds of ordinary chronic illnesses. Moreover, most of those beds belong to the veterans' hospitals, to which the general public has no access.

"Never mind any higher expectations--it will take at least five years for treatment of most chronic illnesses to reach the quality enjoyed by psychiatric patients now," Yeh Chin-chuan frankly admits. Those afflicted by chronic disease are the aged, who do not comprise a particularly high proportion of the overall population (7%), and for the following five years they will have no choice but to "stand firm under adversity."

Medical facilities for chronic disease care are just one segment of the follow-up treatment system. As for other segments, such as in-home care under the aegis of universal health insurance payments or privately funded nursing, current supply simply can not meet demand. Even farther in the offing is a system of preventive health care, which has already been recognized in developed countries as "really being able to save big money on health insurance." The current network facilities are equally fragile and weak. Even ground-breaking programs, which originally started with good intentions, such as annual medical checkups for adults or pap smear tests for women, have yet to be implemented, under the pragmatic principle of "We can't handle the burden we have already; where would we get the funds to pay for preventive medicine?"

Health care places an emphasis on prevention. In terms of expensive major injuries, good public safety and emergency rescue operations can help reduce the number of accidental injuries, which can amount to a great savings in medical insurance costs. The photo shows the aftermath of the "Ode to Joy" KTV fire in Taipei.

A race in which no one can move

With a health care network as yet incomplete, is the burden of creating a universal health insurance plan inevitably too heavy to bear? Honestly, in this atmosphere of hesitancy and doubt which prevails among public officials, the medical community and patients alike, "Let's take things one step at a time" has become the standard answer of nearly every interviewee. Fortunately, Yeh Chin-chuan, who shoulders the greatest responsibility in creating universal health care, does not take this pessimistic viewpoint.

Applying a different metaphor, Yeh observes, "It's like starting a new neighborhood. It is impractical for the residents to wait for the supermarket to be built and the bank to open up before they move in. On the contrary, after people move in, stores and banks, seeing there is money to be made, will naturally follow."

Nevertheless, before a health care network is established, a number of apparatuses which should be implemented will unquestionably be obstructed. Not only will it be impossible to dismantle unreasonable temporary measures, but also the DOH will have to pay for inappropriate expenses. Will universal health insurance ultimately succeed in hastening the arrival of a perfect health care network, or will the present imperfect health care network drag down universal health insurance? This is a race against time. For the Department of Health and the entire citizenry, it will be a severe test.

[Picture Caption]

p.28

The Universal Health Insurance Plan, initiated in March of this year, will allow the nine million Taiwan residents who have not had access to health insurance to step out from under the shadow of "not being able to fall seriously ill." Currently the plan is the recipient of both praise and condemnation. No matter which view holds the most merit, universal health insurance has already become a milestone in Taiwan's health care system.

p.29

Universal health insurance benefits those who originally had no insurance, but the burden on those who already had insurance is correspondingly heavier. Of these, blue collar workers have protested the most loudly. The photo shows a workers' protest march.

p.31

Comprehensive Medical Care System

p.32

Limited in terms of transportation and population, remote mountain villages and offshore islands may not be able to support a professional physician. But with such means as mobile medical vehicles and telemedicine, which have been in operation for some years, most illnesses can be handled. (photo by Cheng Yuan-ching)

p.33

Regional Disparity of Physicians Before and After Implementation of Health Network Plan

Note: Target number for the second phase of the health care network is a minimum of 6.5 doctors per 10,000 people in every medical region.

p.33

Regional Disparity of Hospital Beds Before and After Implementation of Health Network Plan

1995 estimate includes those which were certified but not in operation as of June 1994

Note: Target number for the second phase of the health care network is a minimum of 20 ordinary hospital beds per 10,000 people in every medical region.

p.34

Outpatient Medical Costs Paid by Insurance Holders Under the Universal Health Insurance Plan

Source: National Health Insurance Bureau

p.35

The medical referral system, in which minor illnesses are treated at smaller clinics and major afflictions at large hospitals, is based on the best of intentions, and it can reduce the misuse of medical resources. On the one hand, it requires the cooperation of the people, but creating a good referral system is a pressing matter.

p.36

In the past small local hospitals had relatively few hospital beds and little economic prowess. In the future they may be able to go the route of group-practice clinics or chronic illness treatment centers, in order to use resources more rationally.

p.37

Health care places an emphasis on prevention. In terms of expensive major injuries, good public safety and emergency rescue operations can help reduce the number of accidental injuries, which can amount to a great savings in medical insurance costs. The photo shows the aftermath of the "Ode to Joy" KTV fire in Taipei.

p.38

In the past, in-home nursing was only covered by public servants' insurance and operated at an experimental level. In the future, it will be covered in full under universal health insurance, to encourage patients bedridden for long periods of time to receive care in their own homes.

In the past, in-home nursing was only covered by public servants' insurance and operated at an experimental level. In the future, it will be covered in full under universal health insurance, to encourage patients bedridden for long periods of time to receive care in their own homes.