The financial strain in Turkey's health system caused by ‘City Hospitals’

Berke Kaya

Amongst other things, the COVID-19 epidemic has shown the worldwide collapse of healthcare systems. That has largely to do with the advent of an approach that treats the health system as profit-generating industry. According to the World Health Organization (WHO), Italy boasts the second best healthcare system in the world. Yet the virus seems to have brought it to its knees. France, which tops the list, is not in a great position either. How could these systems, which the WHO regards as the best in the world, collapse with the virus?  

Economic policies shape healthcare systems. And as a result of neo-liberalism, the health sector has become a field dictated by the whims of the market. If France claims the world’s best healthcare system according to the WHO, the US is at the 37rd place, while Turkey is at the 70^th place. The French healthcare system is based on taxes, especially, and insurance. 

The French insurance system relies on three pillars and takes into account each individual’s place in the labor market. Since 2000, the national insurance system includes almost the entire population in France. That mechanism is also based on the so-called “Triple Payment System.” According to this system, the individual makes the payment for their treatment beforehand. Depending on the treatment, the entire payment, or some of it, will be reimbursed. 

Besides, therapeutic medicine is still practiced in France. According to this approach, emphasis is placed on curing the disease rather than preventing it. Within this system, most expenditures go to treatment costs, which benefits the pharmaceutical industry. 

Italy, on the other hand, has a more communal health system. Its National Health Services were established in 1978. There are three layers in that system: national, regional and local. Health institutions are autonomous and local. Regional administrations and sub-organizations are responsible for it. These regional administrations have a say in the budget allocated to them by the central government yet they also have autonomy to raise funds and enact policies. 

Each citizen living in Italy is registered with the Local Health Unit and the municipality. Any citizen wishing to receive health services would go to the local unit first. Most of the health services are free but specialists and special services are not included in this process. The state supports the purchasing of drugs. Though pharmacies in Italy are largely private, much of the prescribed medicine can be obtained at no cost. 

In short, while the ideal health system should be preventive, both the French and the Italian systems are remedial. The pharmaceutical industry benefits from these systems. 

The socialist health system in Cuba offers some interesting insights. Though it is placed under the embargo of the US, its healthcare systems remains exemplary. How is that possible? 

In Cuba, socialism determines its health, education and labor policies. An important component of its system is its regionalization, which enables health policies to be carried out in every corner of the country. All health resources are allocated according to a regionalized structure and local polyclinics were formed. Then the “Family Practice System” was introduced. 

In this system, a doctor and a nurse are appointed to each family. This medical staff lives where the families live and regularly checks on the families and offers preventive services. This has allowed Cuba to achieve its low rate of diseases and mortality. 

Another crucial difference in Cuba is that the pharmaceutical sector is public. Prior to the revolution, there were about 40,000 drugs being sold in Cuba. After the revolution, this figure was reduced according to the principle of “production according to the need”. Doctors were required to take this into account whilst prescribing medicine.  Since the Cuban pharmaceutical sector belongs to the public, the production is not dependent on profit. Public resources tend to be dedicated to the prevention of diseases. That is precisely why Cuba is one of the countries that has been sending doctors to many countries across the world to help fight the COVID-19 epidemic. 

The Turkish case

On the other hand, the Turkish healthcare system is in a dire state. The recent building of city hospitals and the curbing of the health staff’s rights have further worsened the situation. 

Turkey has seen different healthcare system models. Yet after the 1980 coup, the neo-liberal approach has largely triumphed.  

After the Justice and Development Party (AKP) came to power, a programme was introduced in 2003, which according to report that was published in 2011 by the then-Health Minister Recep Akdağ, it was stated that the program was introduced to tackle the “increase in health costs and the weakness of the public payment power.” In other words, the program was introduced to allow private health companies to make profit. After its implementation, the health budget gradually decreased and public hospitals began to face significant financial difficulties. 

In a letter to the IMF in 2005, State Minister Ali Babacan suggested a number of steps to improve the balance of incomes and expenses, including efforts to cut down on costs. 

Another important component of this program was the integration of the SSK, a social security institution, and public hospitals into the Health Ministry. It also introduced the so-called ‘City Hospitals’, the first of which was founded in the central Anatolian town of Yozgat, in 2017. Its dimensions were strikingly big. 

The reason for this is that in the ‘City Hospitals’ model, the hospital buildings were to include malls, hotels, restaurants etc. In fact, that model first came about in the UK, as a public-private cooperation model. In the UK however, that model was largely relinquished. Perhaps that had to do with the fact that the state did not guarantee a minimum number of patients to be treated in those ‘City Hospitals.’ In Turkey, the state offers a guarantee to the company that its citizens will get sick and be sent for treatment. 

In Turkey, the contractor for the ‘City Hospitals’ is Rönesans Holding. In 2018, the global turnover of this Holding was 4.9 billion dollars. And according to Health Minister Fahrettin Koca, the budget the state will allocate to the ‘City Hospitals’ in 2020 will be 10.2 billion Turkish Liras. This constitutes 18 percent of the Health Ministry’s general budget. Some 5 billion liras of this allocation are dedicated to the rent to be paid to the partners who built the hospitals.

The COVID-19 outbreak has highlighted the financial strain caused by the ‘City Hospitals.’ Data show that in Turkey, more than 107,000 cases and a total of more than 2,000 deaths have occurred. Turkey’s recovery rate is stated as 23.74 percent.

Yet according to experts, these data are troublesome. 

Whilst fighting an epidemic, authorities should focus on preventing the disease, not catering to the interests of capital. 

Trump declared that the U.S. would “see more deaths by shutting down the economy than from the coronavirus.” In Turkey, Presidential Spokesman İbrahim Kalın said the cost of the curfew would be huge. These words and the fact that many workers have been exempt from the curfew are actually top-level acknowledgements that governments are focusing on the economy, rather than health.

In fact, the 5 billion liras that will go to the ‘City Hospitals’ could be used for preventive/protective health measures. The best way to fight against the COVID-19 is through test kits, but capital-owners are buying them in bulk while people form long queues at hospital doors waiting to be tested. 

More than ever, the COVID-19 outbreak has demonstrated the need to shift to a solidarity-based healthcare system.