Healthcare system restructuring and the effects of globalization on post-Soviet transitional economies.

• Author: Cholewka, Patricia A.
• Position: Report

Abstract

Initial strategic priorities identified by the global community for the post-Soviet nations upon acquiring independence were for macroeconomic reengineering. While it was generally acknowledged that the functioning of the social welfare system of the Soviet Union was inefficient and ineffective, emphasis on the improvement of healthcare quality and safety, cost reduction, and revenue enhancement for fiscal viability remained unaddressed during post-Soviet economic restructuring. Microeconomic institutional management focused on organizational processes and human capital development, especially for the healthcare sector, was largely ignored. In addition, the need for gauging patient satisfaction, providing a more supportive clinical environment for practitioners, and strengthening the teaching and research environment was becoming more evident. Mechanisms to track program results and fiscal responsibility remained absent from any reengineering plan. This situation remains the same today even as many of these nations are participating in international organizations such as the European Union (EU), the North Atlantic Treaty Organization (NATO), and the United Nations (UN) in their efforts to globalize their health systems. This paper will examine some of the many challenges facing these health systems as they rapidly transition from communism to more globally focused democratic governments all within a period of just over a decade.

Introduction

With the fall of the Soviet Union in 1991 and the resulting independence of its once centrally controlled regions, Western countries were challenged to provide effective mechanisms to restructure these command economies into more democratic, market-focused organizations. Various Western management models based on a team management approach, using participative decision-making, human capital development, and fiscal responsibility, were proposed as a prerequisite for joining the international community within a globalization framework. However, even when financing was provided by the international community, monitoring mechanisms were never stressed, and managers were not required to adhere to fiscal responsibility criteria during this reengineering period--at least, in this context--by the healthcare sector. In the reshaping of the governance of social and public institutions, emphasis was given to fostering the development of "reflexive" social stakeholders to act as change agents. It was anticipated that these leaders would be better prepared to deal with risk and uncertainty and encourage changes in the behavior of individuals and institutions. They, and those they fostered, would be more adaptive to democratic changes and be self-monitoring. This behavior change process was seen as essential in moving these countries toward greater democratic participation and for defining sustainable solutions designed to strengthen new organizational structures. But how could system changes occur when the change agents were steeped in communist ideology and bureaucratic behavior that relied on being directed by a central authority? The Soviet legacy of widespread societal corruption is cited by the World Bank as being a major factor for delaying these sustainable development efforts. According to Aidis and Mickiewicz (2005) corruption continues to negatively affect entrepreneurs' motivation to grow and compromises the credibility of the investment environment (see Table 1).

[TABLE 1 OMITTED]

Relationship of Public Policies to Social and Health Capital Development

The National Institutes of Health (NIH) define social capital as the network of societal institutions and relationships (social environment) that together have a positive influence on the function of communities and individuals (http://www.grants.nih.gov/grants). This social environment, or social network, includes individual, institutional, and community-level characteristics, e.g., socioeconomic status (SES), education, coping resources and support systems, residential factors, and cultural factors. Social determinants of health refer to factors in this social, cultural, and physical environment that interact to influence population health ((http://www.grants.nih.gov/grants). Therefore it can be said that both public and private policies can set economic conditions that influence the nature and quality of daily environments and can cause pervasive affects on health status (Zollner, Stoddart & Smith, 2003). According to Zollner, Stoddart & Smith (2003), health capital is determined by an interaction of the following factors: genetic, life risks, environment, individual behavior, social group, and affiliated healthcare system. They believe that there is an interrelationship of health and health care--and that health care and the economy are not independent. "Health care is one of a broad array of determinants of health, and healthier populations tend to be more productive populations ..." (Zollner, Stoddart & Smith, 2003, p. 1).

According to the World Bank, The relationship between social capital and health has been documented since 1901 by Emile Durkheim. Since then research has continued to demonstrate that higher social capital and social cohesion leads to improvements in health conditions. Recent research shows that the lower the trust among citizens, the higher the average mortality rate (http://www1.worldbank.org/prem/poverty/scapital/topic/health1.htm). But in the case of the Soviet Union, the social capital and social cohesion imposed by the Soviet political and economic system was never overwhelmingly adopted and incorporated into these nations. Upon independence and the development of a more open political environment, once suspect health-related statistics that reflected a robust health capital for these nations started to be investigated and trended by global organizations, such as the World Health Organization (WHO) and in the case of the United States, the United States Agency for International Development (USAID) and the NIH. It was found that population mortality and morbidity rates, when available, exceeded those for most western societies and still do (http://www.who.int/en and http://www3.who.int/whosis/mort/table.1). Why was this situation occurring? Western analysts had insisted the Soviet social welfare system was one of the best in the world since it touted universal access to healthcare. Their education system and scientific establishment was also considered renowned.

The high mortality and morbidity rates can be partially explained by examining the underlying political ideology and enforced policies that emphasized the good of the "state" over the needs of the people. In their recent study of issues affecting socioeconomic transition of postSoviet societies, Berengaut and Elborgh-Woytek (2005) show...