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The role of contractual arrangements in improving health sector ...

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Jordan<br />

K<strong>in</strong>g Abdullah Hospital (KAH) was opened <strong>in</strong> 2002 to function as a teach<strong>in</strong>g hospital to<br />

the Faculty <strong>of</strong> Medic<strong>in</strong>e at Jordan University for Science and Technology. It serves as a referral<br />

hospital for all <strong>health</strong> <strong>sector</strong>s <strong>in</strong> Irbid and Northern Region. <strong>The</strong> M<strong>in</strong>istry <strong>of</strong> Health and KAH<br />

signed an agreement <strong>in</strong> 2001, similar to the JUH agreement, to provide medical services to the<br />

beneficiaries who are referred to KAH by the M<strong>in</strong>istry <strong>of</strong> Health hospitals <strong>in</strong> the Northern<br />

Region.<br />

Ma<strong>in</strong> features<br />

• Emergency cases and patients referred by the M<strong>in</strong>istry <strong>of</strong> Health hospitals are treated without<br />

any co-payment. Self-referred patients pay 10%–30% <strong>of</strong> the hospital costs, depend<strong>in</strong>g on the<br />

category <strong>of</strong> their <strong>in</strong>surance plan.<br />

• <strong>The</strong> M<strong>in</strong>istry <strong>of</strong> Health pays each hospital accord<strong>in</strong>g to its <strong>of</strong>ficial charge scheme with 25%<br />

discount exclud<strong>in</strong>g medic<strong>in</strong>es.<br />

• <strong>The</strong> M<strong>in</strong>istry <strong>of</strong> Health pays a monthly deposit to JUH and KAH (JD 400 000 and JD<br />

200 000, respectively).<br />

• <strong>The</strong> two agreements conta<strong>in</strong> some caps to rationalize the utilization <strong>of</strong> services and conta<strong>in</strong><br />

costs (e.g. the referral letter expires after three months, the M<strong>in</strong>istry <strong>of</strong> Health pays only for<br />

two outpatient visits per month for each patient).<br />

• <strong>The</strong> M<strong>in</strong>istry <strong>of</strong> Health appo<strong>in</strong>ts a full-time liaison committee <strong>in</strong> each hospital. <strong>The</strong><br />

committee reviews and authorizes claims and acts as coord<strong>in</strong>ator between the hospital and<br />

the M<strong>in</strong>istry <strong>of</strong> Health <strong>in</strong> all aspects related to the agreement.<br />

• A higher jo<strong>in</strong>t committee headed by the M<strong>in</strong>ister <strong>of</strong> Health with senior members from both<br />

parties is formed for each hospital to resolve problems, settle disputes and suggest changes<br />

on the terms and conditions <strong>of</strong> the agreement.<br />

Strengths<br />

• Provide access for the M<strong>in</strong>istry <strong>of</strong> Health beneficiaries to tertiary and presumably higher<br />

quality patient care available <strong>in</strong> teach<strong>in</strong>g hospitals.<br />

• M<strong>in</strong>imize pressure and over-utilization <strong>of</strong> the two major M<strong>in</strong>istry <strong>of</strong> Health hospitals located<br />

<strong>in</strong> Amman and Irbid (Al Bashir Hospital and Basma Hospital). This reflects positively on<br />

social equity by giv<strong>in</strong>g the poor and un<strong>in</strong>sured people a chance to be treated <strong>in</strong> highly<br />

subsidized public hospitals almost free <strong>of</strong> charge.<br />

• Improve the utilization rates <strong>in</strong> the two teach<strong>in</strong>g hospitals and provide them with regular<br />

cashflow to meet their recurrent f<strong>in</strong>ancial obligations. In 2002, 64% <strong>of</strong> the total admissions <strong>in</strong><br />

JUH and KAH were the M<strong>in</strong>istry <strong>of</strong> Health beneficiaries (JUH and KAH Annual Reports,<br />

2002).<br />

• Treat<strong>in</strong>g beneficiaries <strong>of</strong> the M<strong>in</strong>istry <strong>of</strong> Health <strong>in</strong> public teach<strong>in</strong>g hospitals is more cost<br />

effective than treat<strong>in</strong>g them <strong>in</strong> private hospitals. <strong>The</strong> average cost <strong>of</strong> admission <strong>in</strong> private<br />

hospitals is almost three times higher than <strong>in</strong> JUH or KAH (Table 5).<br />

• It is more cost effective for the M<strong>in</strong>istry <strong>of</strong> Health to purchase tertiary care for its enrollees<br />

(beneficiaries) than to provide this service directly. In 2003, the M<strong>in</strong>istry <strong>of</strong> Health utilized<br />

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