Problems in Georgia’s Hospitals - საერთაშორისო გამჭვირვალობა - საქართველო

Problems in Georgia’s Hospitals

29 October, 2012

A wave of protests took place at hospitals in the regions and in Tbilisi last week. The protests were organized by the medical personnel who where dissatisfied with their overdue and decreasing salary, and the way the hospitals have been managed by the new owners. The current situation seems to stem from the large hospital privatization program, the lack of transparency regarding the new owners and their plans, and the lack of sufficient regulation to deal with the resulting problems. TI Georgia calls on the new government to deal with these problems that endanger the quality and sustainability of the health care system in Georgia.    

Protests have reportedly taken place in Batumi, Poti, Chiatura and Tbilisi. One of the problems reported is at Amtel hospital 1st clinic (previously known as the first clinic) – one of the largest hospitals in Tbilisi - which is currently owned by Daniel Gupta. Daniel Gupta is the director of the Russian-based real estate company Amtel properties that mainly focuses on business centers and hotels.  According to Natalia Gogava, senior specialist of international and public relation of the Health, Pharmaceutical and Social Care Workers Independent Trade Union of Georgia, the medical staff did not receive their salaries for three months and the salary of doctors has been decreasing for the last years. This has prompted several specialists to leave the hospital, resulting in setback in terms of the quality of services at the hospital. The problem here is not only that the situation of the people working in the hospital has not changed for the better: It is also very difficult to determine what the plans of the owners are.

Similar problems have been reported in Batumi, Poti and Chiatura, where the medical staff have urged the owners to improve the situation in the hospitals and to honor the existing agreements. Several months ago, TI Georgia visited the hospital in Chiatura where we found a number of serious problems.

In the maternity hospital in Batumi the staff heard that the building was about to be sold to a private investor, while the equipment was already bought by a company called New Life LTD. The staff, however, did not know who the owner would be and started the protest, demanding more information regarding the plans to sell the hospital. After the protest, the Batumi City Hall announced that the building would not be sold. It is very difficult to obtain information about the New Life company or its owners and their plans.   

In Poti the medical staff claimed that the owners of the company Aldagi BCI did not fulfill their obligations, as the technical capacity to provide emergency medical assistance was still inadequate because of what they described as a human resource crisis. They filed the same complaints that TI Georgia had previously heard in various hospitals owned by insurance companies or private investors. It often happens that medical staff receive a different salary each month or do not receive salaries at all for several months and that there is insufficient capacity to maintain crucial services such as emergency care.

The problems discussed above arise in hospitals in the regions as well as in Tbilisi and pose serious threats to the health care system. The deteriorating position of doctors, the lack of transparency about the privatization process and the plans of future owners, as well as the lack of enforcement of obligations, creates a situation that increasingly undermines the quality of health care.

A major problem in this respect is that the privatization contracts of the majority of privatized hospitals only require the new owners to retain the hospital profile for seven years. TI Georgia’s previous research shows that it is unlikely that all the owners, or even the majority of them, will keep their hospitals running past that period of time.  

Based on TI Georgia’s research concerning the hospital sector, we will produce several policy proposals that can help to improve the quality and affordability of health care, as well as the position of patients and doctors. While the new government cannot be blamed for the current situation, it does have the responsibility to take care of it. TI Georgia therefore calls upon the new government to address the problems described above by:

  • Creating more transparency in the ownership of hospitals, as well as requiring the owners to provide the staff and the public with adequate information regarding their plans;
  • Increase the role of  the government as a health system steward in order to ensure quality and safety .  
  • The expansion of the private sector should be better accompanied by an effective regulatory system to ensure hospitals will sufficiently provide all the services.
  • According to the World Health Organization a well functioning health system inter alia requires a adequately paid workforce therefore improving the position of doctors by introducing a minimum of working standards which should be better enforced;
  • Setting up a comprehensive database about health providers to provide better insight about the situation within hospitals throughout the country;
  • Increasing cooperation between the owners of the hospital, the staff and the Health, Pharmaceutical and Social Care Workers Independent Trade Union of Georgia to address problems in health care more efficiently;
  • Guaranteeing long-term sustainability of hospitals beyond the seven-year period to prevent hospitals or crucial services from disappearing;
  • Enforcing regulations to make sure that every hospital is capable to adequately provide crucial services;
  • Introducing a better system for holding private investors accountable for a failure to provide the necessary resources for crucial services;

Currently about 40% of the hospitals in Georgia are owned by insurance companies. We have  seen that a conflict of interest arises in these hospitals that often provide social insurance to the people in the regions where their hospital is based. This negatively affects the quality of services and has often led to cases where patients are denied to have a needed service. One possibility to deal with this is to run hospitals by independent management companies rather than insurance subsidiaries. Such a detachment should entail a genuinely independent management while the insurers can enjoy the right of investor. This should be at the same time accompanied by a stronger regulatory system to ensure the quality. Alternatively, the government could  buy the hospitals from the insurers and later sell them to other appropriate investors under better contracts and more efficient regulations. TI Georgia will soon publish a policy brief for the government that provides detailed recommendations to deal with the current situation in health care.


Author: Gerard de Boer