Administrative simplification (eg simplex, e-government) and reduced demand for services (eg drastic reduction in the number of students) lead to a reduction in the total costs of public services provided. In the health sector, however, population aging, new technologies and population expectations have led to a greater volume of services provided and increased expenditure. However, Portugal annually reduced on average 0.7% of its health expenditure between 2005 and 2015.

In fact, the Portuguese health system is always very well positioned when compared to other health systems. However, in some indicators Portugal is quite distant. Among these indicators are 1) total health expenditure per capita (adjusted for purchasing power parity) and 2) the percentage of public health expenditure over total health expenditure. In the first indicator, Portugal spends about 62% of the average of OECD countries. In other words, each Portuguese spends about 1,000 US dollars less per year than the average for developed countries. Regarding the second indicator, the Portuguese State is responsible for ensuring 66% of expenditure incurred in health, against 73% of the average for OECD countries. In conclusion, for the health results achieved, Portugal spends little in absolute terms, with public funding still falling short of what is necessary.

We are all delighted with the results achieved by the Portuguese health system. We like it to be among the best in the developed world. We get angry when an innovative medicine is missing, a medical error occurs or we wait longer than we should for an appointment, surgery or emergency. In these cases we exclaim that we have the worst healthcare systems, “not even in the third world”!

Few of us should remember, but during the adjustment period, the sectorial Ministry that made the greatest effort to reduce public expenditure was that of health. It made this adjustment with enormous sacrifices for health professionals and populations, with enormous resilience in access and quality of care.

Even fewer should remember the times of 2009 and 2010. In these years, with a strategy to clean up ADSE's accounts, the Ministry of Finance promoted a reduction in the budget of the National Health Service (SNS) by more than 500 million euros. In the already underfinanced sector, there was a “hole” that culminated in 2011 with close to three billion euros in debt to suppliers. Also, since 2009, investment has been declining to an unaffordable level, which, together with the reduction in operating funding, jeopardizes the retention of the best professionals, continuous education and training, and the quality and safety of the services provided.

It is with good eyes that the attention of finances on the NHS and, particularly, on hospitals is observed. The business sector hospitals in the state have a dual tutelage: Ministry of Finance and Ministry of Health. Chronically, hospitals are being rejected by Finance and supported by a mother chicken on the Health side. Mother Health asks for more access ( consultations and surgeries) and quality. It also asks to contain costs. The Finance parent restricts the budget and increases costs with the replacement of wages and overtime, and reduces working hours from 40 to 35 hours. On the other hand, it depletes the competences of corporate hospitals and maintains the centralization in Terreiro do Paço of the current management of hospitals (eg human resources, acquisition of equipment, multi-year commitments), preventing increases in efficiency and gradually leading to the frustration of the actors involved and increased waste.

Not wanting to be exhaustive about the real capabilities of a Board of Directors of a hospital in the business sector of the state, I will focus on just one example: the regulatory framework for multi-year commitments. As can easily be understood, hospitals have a continuous operation, implying that at 23:59 on December 31 of each year, the activity does not end. That is, at 0:00 on January 1st it is not feasible/desirable to change all supplies of goods and services (eg medicines, medical devices, cleaning, food, laundry).

However, public administration entities, whenever they wish to constitute an obligation to make payments in more than one economic year or in economic years other than the year in which the commitment is assumed, are obliged to request authorization from the sectorial Ministry and the Ministry of Finance. Sound simple? It is not.

In practice, there is a huge time lag between the sending of the request to assume a multi-year commitment and the receipt of the consequent prior authorization (on average 9 to 12 months), leading to the triggering of public tender procedures with a duration equal to or less than a year that are often secured at prices higher than those that could be negotiated if the duration of the contract were longer than one year. Furthermore, this time interval compels the triggering of urgent public tender procedures (namely, the direct award with an invitation to one or two entities) that do not fully comply with the competition principle. Worse, many times, you wait all this time before, in most cases, it ends up in rejection by the Ministry of Finance.

Furthermore, as hospitals cannot assume charges in a different economic year without proper authorization, they end up operating in the first months of the year through direct adjustments.

It could address many more areas of this parental alienation. But now that “Finance tightens control over healthcare spending” I am sure these issues will be resolved and hospitals will have the opportunity to be more efficient.

As in any parent-child relationship, the relationship between hospitals and finances is based on autonomy and accountability. This is what is asked of the Ministry of Finance. Allow for a qualification framework for hospital administration and health management, including specialized and continuous education and training, a transparent recruitment process and performance assessment, and continuous training. According to the statute of public manager, managers with poor performance must be subject to a dismissal process. Nothing more in agreement. Implement yourself!

Let's hope this shared custody of the hospitals secures two parents present. It is not at the end of the year that the divorced father comes to ask the mother why her son failed. Even more when it is widely recognized by all that the alimony is insufficient.

Article published in Observador on May 31, 2017. The original article can be read on here