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Sunday February 5th, 2023

INTERVIEW-Crisis-hit Sri Lanka explores “paying wards” to manage free health services

ECONOMYNEXT – Sri Lanka’s health minister Keheliya Rambukwella is exploring possibilities of starting more paying wards in state-owned hospitals to sustain the free health service to the most needy people while catering to increasing demand of quality in health services.

Sri Lanka’s unprecedented economic crisis has forced the island nation government to look into all the possibilities to cut costs across all the sectors while the country’s free health and education services are facing threats of cost cutting and reduced services.

Already many state hospitals are facing scarcity of medicines despite donations and grants from many international organizations.

“I am trying to see whether I can get 30 percent of paying wards back again,” Health Minister Keheliya Rambukwella told an interview with EconomyNext on Thursday (13).

“This is not only for cost recovery, but we can give better service than any of the private sector.”

Sri Lanka has allocated 4 percent to health sectors in 2022 out of its total 6.2 trillion rupee revised expenditure. However, many state hospitals are struggling to maintain the free health services and severe deficit of some drugs.

The paying ward concept is already in practice at Colombo National and Sri Jayawardenapura Hospital at a reduced cost compared to private hospitals. Minister Rambukwella said the move was not to privatize the health service, but to sustain the free health service.

Services at 50% cost of private hospitals

“We can’t compromise free health. It is part of the government policy. “This will also amount to saying that the health is being privatized. But we have to give a serious thought to how long we can do that in the next 10 years,” he said while seated at his office in the Health Ministry surrounded by approval files on his table.

“As far as services are concerned the government health service is much better than the private health services. If people see better service for the half of the cost with a room, they will go for paying wards.”

Health Ministry has identified many equipment in state hospital are under utilized compared to the private sector while the paying ward concept also could help hospital staff as well.

Minister Rambukwella said he was exploring separate shift basis in state hospitals for both free and paid wards.

“I am also trying to keep 8 am to 4 pm for free health services. Then 4 pm to next day 6 am, there are cardiologists who are wiling to accommodate. Bring them down, get them to do it and charge only 50 percent of what the private sector is charging. and pay a good fee for the doctor and supporting staff. So they will have some incentives.”

The Minister also said the proposed paying ward system, which has yet to be proposed to the cabinet before the parliament, will also reduce the waiting queues for surgeries because a number of patients could seek the services at the paying wards at the half cost of the private sector.

“The most important thing in that scheme is the (waiting) queue will be reduced to six months instead of 2 years. People who are really in need will wait for that time and get it. Then the waiting list also will get reduced.” (Colombo/Oct13/2022)

Comments (4)

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  1. sacre blieu says:

    His brains have at last settled in the correct cranial cavity and now pulsating with creative energy. And why not. The merchants’ ward at the General Hospital is similar and now that most Government hospitals in the major cities have advanced, the creation of paid wards and even rooms would ensure the doctors will save travelling time and be able to devote that time towards patients, even the other staff should also benefit. Most importantly, the hospitals should not be interfered with by anyone whatsoever other than the established management order. More so, cost recovery should be ensured and accountability upper most.

  2. Kumar Sabaratnam says:

    Good proposal. Should be implemented soon. Govt should not give free health services to those who are above a certain income category & can afford them. A reasonable amount could be charged instead of free service to those who can afford it. Then the medical staff can have better salaries & the health dept will be able to manage costs

  3. A.Rajakumar says:

    Good move. Long overdue. In the beginning, let the onus be on the patient to declare him or herself as below the threshold, the Govt may impose, when availing of free health care in hospitals.
    Second, introduce a free medical consultation service to every person, poor or rich, up to a specified value, with the cost covered by collecting a % of the net income, above a specified amount, from all working individuals. This is successfully implemented in many rich nations.

  4. K.Wijesuriya says:

    I think we must have some semi-government hospitals.
    This is the alternative. I do not think this proposal is a viable solution. Because this will end up a highly corrupt Health system. You have to give a membership to the Hospitals and collect some money from their Salary. This way you can overcome the problem. You have to plan how the members can get some special benefits without hurting the free health system. Do not divide the hospital. Then it will be the end of the great Free Health Service in Sri Lanka

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Your email address will not be published. Required fields are marked *

  1. sacre blieu says:

    His brains have at last settled in the correct cranial cavity and now pulsating with creative energy. And why not. The merchants’ ward at the General Hospital is similar and now that most Government hospitals in the major cities have advanced, the creation of paid wards and even rooms would ensure the doctors will save travelling time and be able to devote that time towards patients, even the other staff should also benefit. Most importantly, the hospitals should not be interfered with by anyone whatsoever other than the established management order. More so, cost recovery should be ensured and accountability upper most.

  2. Kumar Sabaratnam says:

    Good proposal. Should be implemented soon. Govt should not give free health services to those who are above a certain income category & can afford them. A reasonable amount could be charged instead of free service to those who can afford it. Then the medical staff can have better salaries & the health dept will be able to manage costs

  3. A.Rajakumar says:

    Good move. Long overdue. In the beginning, let the onus be on the patient to declare him or herself as below the threshold, the Govt may impose, when availing of free health care in hospitals.
    Second, introduce a free medical consultation service to every person, poor or rich, up to a specified value, with the cost covered by collecting a % of the net income, above a specified amount, from all working individuals. This is successfully implemented in many rich nations.

  4. K.Wijesuriya says:

    I think we must have some semi-government hospitals.
    This is the alternative. I do not think this proposal is a viable solution. Because this will end up a highly corrupt Health system. You have to give a membership to the Hospitals and collect some money from their Salary. This way you can overcome the problem. You have to plan how the members can get some special benefits without hurting the free health system. Do not divide the hospital. Then it will be the end of the great Free Health Service in Sri Lanka

Sri Lanka President’s address to the nation- Full text

ECONOMYNEXT – Sri Lanka President Ranil Wickremesinghe in an address to the nation on the 75th independence day, calling for an end of divisive politics, minority discrimination and politics of deceit.

He promised maximum devolution within a unitary state.

After independence the country was divided on race, religion and region, he said.

“We were divided to a point of developing suspicion and animosity against each other,” he said.

“Various groups exploited this division to gain power and created further rifts among the people. Instead of rejecting such groups, we accorded power to these very same groups.”

“In politics, lies were spread instead of the truth. Politicians who spoke the truth were rejected by the people.

“Those who pointed out the real situation of the country and sought related remedies were hardly given a place. Yet, those who satisfied people with their lies gained greater acceptance.

The full statement is reproduced below:

Most Venerable Maha Sangha and the clergy, my fellow citizens, all Sri Lankans abroad, dear children,

Today, I will not be delivering a traditional Independence Day statement. I am not going to dwell on the freedom we gained. While honouring those who were dedicated and worked hard for the country’s freedom, including the late Mr. D.S. Senanayake, I will focus on regaining the freedom that we have lost today.
Around 75 years ago, the esteemed ‘London Times’ newspaper carried an editorial stating that “It is our desire to see Sri Lanka become a Switzerland in the East, very soon.”

They had not expressed a similar vision for any other country in the East.

However, what has happened to us today?

Today, we are facing an unprecedented economic crisis, hitherto never experienced.

Why have we to face such a situation? Who is responsible for such?

Let’s be truthful. All of us are more or less responsible for this situation. None of us can point fingers and blame each other.

We made mistakes from the beginning. Efforts were made to rectify those mistakes, though it was not possible to correct them completely.

The policy followed by the late Mr. D.S. Senanayake in securing the country’s freedom was to unite all Sri Lankans. He believed that everyone, be it Sinhala, Tamil, Muslim or Burgher, should forge ahead as Sri Lankans.

However, after independence we divided in terms of race, religion and region. We were divided to a point of developing suspicion and animosity against each other. Various groups exploited this division to gain power and created further rifts among the people. Instead of rejecting such groups, we accorded power to these very same groups.

In politics, lies were spread instead of the truth. Politicians who spoke the truth were rejected by the people. Those who pointed out the real situation of the country and sought related remedies were hardly given a place. Yet, those who satisfied people with their lies gained greater acceptance.

We got trapped in a consensual political culture. Our characteristic was to be depended on borrowed resources and we borrowed even more.

We adopted the notion that, “The government is a spring of resources”. Many were of the view that the duty of the rulers was to distribute the various resources obtained from that spring, among the people. Accordingly, job opportunities were provided and various goods and equipment were also distributed. Cash was also made available.

In most instances, we did not vote on behalf of the country. Instead we voted for a candidate in order to receive a job, to gain admission to a school for our children and to have a tender passed etc. We worked for political candidates expecting personal favours in return.

Most of us contested not for the country, but for personal power, for greater perks and to earn a little more.

We were trapped in promises and endured slogans which finally resulted in the gradual collapse of the country’s economy. We borrowed increasingly to fulfil election pledges and proved the slogans shouted at the protests were correct.

We borrowed more for consumption rather than for investment. However, according to the Buddhist Philosophy one should take loans for investment purposes and not consumption. While we are talking of Buddhism, our action is not in keeping with the Buddha’s teachings.

Lee Kuan Yew, who visited Sri Lanka to study and formulate a strategy to rebuild Singapore, said after many years, that . “This situation has arisen in Sri Lanka due to unnecessarily prioritising politics. If Sri Lanka was followed as a role model, even Singapore by today would have perished.

In fact, we have reached the point of destruction. There are those who want to keep perpetuating this wound forever, though I don’t wish. Let’s seek to heal this wound though it’s difficult and painful. If we endure the suffering and pain for a short period of time, we can get the wound healed completely.

We have no way out of this crisis with short cuts as that some political parties are pointing out.

We have only one way to get rid of this situation, if we want to overcome this crisis and achieve real economic and social freedom. Remember, if we miss this path due to misplaced political agendas, we would neither have a future nor a country.

On several occasions, I pointed out the seriousness and danger of the looming economic crisis we are facing today. I have already said that the first six months of this year will be extremely difficult. We have to face this difficult situation in our stride, although unwillingly, for the sake of the country.

Although a large number of people in this country got out of poverty with the free education and expanded the middle class, today the country has turned into a land where it is impossible to fulfil their aspirations. I see the youth who should be working hard in different fields in this country are creating long queues to obtain passports. We need to change this situation too.

To achieve this end we should modernize the economy and open it to the world. The corrupt political factionalism that deceives the people making them dependants and poor for ever should also be changed. This is the “system change” that the youth of this country have been demanding for over a long period of time.

My government therefore has embarked on new path of reform to fulfil the needs of the youth. Even though those decisions that have to be taken for it are painful, it has to be done in order to overcome.

We have to move away from narrow politics in order to be rid of this crisis situation. We must face this challenge together as children of one mother and make our fullest contribution to strengthen the path towards the successful development of this country. We must all move forward as Sri Lankan nationals leaving aside all differences.

Hence the basis and foundation for a strong new economy has already been formulated. We are successfully completing the difficult stage required to get support from the International Monetary Fund (IMF). We expect to get their consent without delay.

We cannot be satisfied just by strengthening the economy. The entire system needs to be changed. All areas of this political system, the legislature, parliament, Executive, state machinery, etc. should be modified to suit the modern era. The nation, and we should benefit from this change. More space should be created in the new system, for representation and opinions of young people and women in particular.
For this system modification, we are proposing a number of orders to the Parliament.

Additionally, immediate action needs to be taken in relation to the unique issues that the people in the North and East face. A cabinet subcommittee for this purpose has already been established.

All political parties are informed of its decisions and their implementation dates. Thereby those tasks are carried forward. We have given priority to activities such as release of land and prisoners.

Furthermore, measures are being taken for the maximum division of power in a unitary state. However, we’ll never consent to the division of this nation.

I’m not attempting to treat the superficial condition with painkillers. But to treat the root cause of the malaise. It is challenging and difficult, but it’s our only option.

I know that many of the decisions I have been compelled to take since assuming the presidency have been unpopular.

However, because of those decisions, today no citizen of this country will die of dehydration in oil queues. You won’t starve without gas. Not curse without fertilizer.

Therefore, regardless of the obstacles the anarchist political forces seek to create, I will continue this new reform program with the majority of people who love this country.

We can become a developed country by 2048 if we work and move forward in a united and planned manner envisioning peace and reconciliation. There is the potential to become a developed country which is not begging from any other nation in the world. True freedom can be achieved and it is possible.

It is our collective responsibility to build a new country in which our children can compete with the rest of the world. Therefore, I urge all parties to come together to overcome this difficult period.
Let’s unite! Let’s join hands!

With joined hands let’s embark on a united journey over the next 25 years, as we have planned. Let’s further nurture those plans in accordance with the views of all parties. Let’s get stronger. Let’s make them more systematic and streamlined.

Not only should all of us who live in Sri Lanka join this effort. But the Sri Lankans living in the different countries around the world should also shoulder this journey. Everyone should be united. Everyone should contribute to the achievement of these goals as much as possible.

Let us devote ourselves, unite as children of one mother. Let us make our country one of the most developed in the world by 2048, when we will celebrate 100 years of independence.
Thank you all.

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Sri Lanka critical on independence day, opportunity to rectify our errors: President

ECONOMYNEXT – Sri Lanka going though a critical time as the 75th anniversary of independence from British rule is being marked on February 04, President Ranil Wickremesinghe has said.

“Our 75th Anniversary of Independence from colonial rule is being observed during an extremely critical and challenging time in the  country,” he said in an independence day message.

“It is, indeed, a decisive moment. However it presents an opportunity for us not only to review our strengths and gains as a  nation but also to rectify our errors and failures.”

Sri Lanka is now in the grip of the worst currency crisis in the history of its intermediate regime, central bank with the rupee falling from 182 to 360 to the US dollar in the current credit cycle.

President Wickremesinghe, is taking unpopular political decisions to stablize the country under a program with the International Monetary Fund, as his predecessors had done before him.

Sri Lanka got independence from the British on February 04, 1948.

At the time economic bureaucrats did not have the power to depreciated the currency by printing money to manipulate interest rates down, but were strictly rule bound and no IMF programs were necessary.

In August 28, 1950, a group of economic bureaucrats were given ‘monetary policy independence’ to print money undermining a peg with gold (1.99 grains of gold) and the US dollar – which was also on a gold standard at 22 units an ounce.

At the time the rupee was only 4.76 to the US dollar.

Sri Lanka joined the IMF the next day, on August 29. Economic bureucrats who mis-targeted rates have since take the country to the IMF 16 times.

As money was printed and forex shortages emerged the population rapidly lost their economic freedoms. First first exchange controls, then trade controls were brought to enable the central bank to continue printing money for extended periods, and avoid prudent monetary policy.

In 2005 Sri Lanka got market access. In 2022 the country defaulted as other market access countries with monetary instability had done in the 1980s and 1990s. Market access countries in the 1980s and 1990s were mainly in the Latin America.

“There is a new economic and social reform agenda before the country  with the objectives focusing first on recovery and then on renewed  development,” President Wickremesinghe said.

“It is imperative for us to unite in its implementation so  that we can emerge with a high level of economic prosperity.”

However there is no attempt to change the flexible inflation targeting under the IMF program, giving monetary policy independence to economic bureaucrats.

Highly discretionary flexible policies where money is printed to reach a 5 percent inflation target is to be legalized as part of the program, just as similar regime was set up in 1950 the day before IMF membership was obtained.

The full statement is reproduced below:

President’s Independence Day Message

Our 75th Anniversary of Independence from colonial rule is being observed during an extremely critical and challenging time in the  country.

It is, indeed, a decisive moment. However it presents an  opportunity for us not only to review our strengths and gains as a  nation but also to rectify our errors and failures.

Since 1948, we have, as a nation, undergone many tests and travails –  from riots, insurgencies and war to natural disasters.

These  experiences have left us with a sense of inculcated resilience that  has made us revive better when faced with adversity. Therefore, I am  confident that even at this juncture we will pool our energies as the  daughters and sons of one mother to rise up from the current economic  abyss and build back stronger.

There is a new economic and social reform agenda before the country  with the objectives focusing first on recovery and then on renewed  development. It is imperative for us to unite in its implementation so  that we can emerge with a high level of economic prosperity.

I pledge  today to make the extremely difficult though vital decisions to  achieve this goal with courage and determination. I anticipate the confidence and support of you, the people of our country, in this  endeavour.

I also take the opportunity to thank you, the Sri Lankan expatriate  community, for your contribution towards the development of our  motherland despite your distance. I would like to invite you to join  us in securing a bright future for the younger generation of Sri  Lankans who are at the vanguard of economic and social development. 

Your faith and investment in the unique and creative ideas of our talented youth who lack capital could give considerable hope and be of  immense benefit to our country in this crisis.

On this historic anniversary, let us all resolve to meet the  challenges of this year with further patience and fortitude.

I extend warm felicitations to you, Sri Lankans, here and aboard.

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Sri Lanka welcomes sovereign bondholders’ letter to IMF

ECONOMYNEXT – Sri Lanka’s State Finance Minister welcomed the letter sent by the island nation’s sovereign bond holders to the International Monetary Fund (IMF) over their willingness to engage in debt restructuring talks.

“The Sri Lankan government welcomes the letter sent by bondholders to the IMF,” Minister Shehan Semasimghe said in his twitter platform.

“We continue to engage in good faith dialogue with our private creditors to find a solution that will help us achieve debt sustainability and will enable Sri Lanka’s economic recovery.”

Sri Lanka’s bondholders on Friday wrote to the IMF and expressed their willingness to engage in debt re-structuring talks but also raising matters related to the domestic debt re-structuring and economic assumptions and forecasts.

More on bondholder views here: Sri Lanka sovereign bond holders not looking for domestic hair-cut

Named themselves as ‘The Ad Hoc Group of Sri Lanka Bondholders’, the group noted that the finalization of an agreement will be subject to the satisfaction of the certain conditions including the central government’s domestic debt – defined as debt governed by local law – is reorganized in a manner that both ensures debt sustainability and safeguards financial stability.

It also asked the gross domestoc fiinancing to be limited to 8.5 percent of the GDP while keeping the  annual gross financing needs not exceeding 13 percent of GDP in the each year between 2027 and 2032 and allowing for central government annual foreign currency debt service to reach 4.5 percent. (Colombo/Feb04/2023)

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