SALON

Wednesday, Aug 24, 2011 12:28 PM UTC

What’s happening to a model healthcare system?

Costa Rica's universal system has long been lauded. Now, it's on the verge of going broke

By

Topics: GlobalPost, Health, Healthcare Reform,

What's happening to a model healthcare system?A Costa Rican patient awaits care in a San Jose hospital on July 20, 2011

SAN JOSE — Right-wing radio host Rush Limbaugh once vowed to flee to Costa Rica if President Barack Obama’s health care reforms took effect.

Limbaugh might have overlooked a couple of critical details: Costa Rica’s respected universal healthcare system is highly socialized. It’s also on the verge of going broke.

Costa Ricans credit health care with helping boost its life expectancy to 78.7 years — on par with the richest countries in the world. Costa Rica’s broad coverage ranked better than most of the Americas, including the United States, in a 2000 World Health Organization index.

Now, hobbled by mismanagement, the system has become overwhelmed by a burgeoning population that includes an increasing number of elderly and new immigrants who rely on the public system for care.

A damning report by the Pan American Health Organization, an international public health agency, found that Costa Rica’s social security system, known as “la Caja,” or savings bank in Spanish, spent greater sums than ever on health care even as service in public hospitals faltered.

At hospitals considered among Latin America’s finest, waiting lists run painfully long. A tally of patients awaiting biopsies at one San Jose hospital reached 11,000 last year.

Laura Chinchilla, Costa Rica’s president, told television viewers last month in one of her most somber addresses that la Caja is on the brink of a “serious crisis.”

“The [budget] shortage can no longer be covered by the current system, and any temporary solution will do nothing more than worsen the problem and the future situation of the institution,” Chinchilla said.

The long queues sway patients with means to opt for faster care in private clinics, popular among throngs of “medical tourists” from the United States.

“If it’s a little thing, it’s better to go to a private doctor,” said Susana Trejos, whose family grows fine coffee in the southern region of San Vito de Coto Brus.

But private health care prices are prohibitively high for most Costa Ricans, so they turn instead to la Caja.

To fund it, wage earners pay a little over 9 percent of their salary in social security tax. Their employer matches that with another 27 percent of each worker’s salary, and the government pays into la Caja as well to help cover the poor.

Anyone in the country of about 4.6 million can fill a prescription at a public pharmacy or have an operation, all paid for by Caja insurance.

Now, Costa Rica’s population is aging rapidly compared to the slowing birth rate — with some enduring seniors living past 100.

Many elderly people live on meager state pensions, leaving them to rely on the state for their care. “This can cost a fortune, and it all keeps getting handed out with not a single charge,” said Dr. Fernando Morales, director of the National Geriatric Hospital in San Jose.

Costa Rica’s labor landscape has also changed, with larger numbers of migrant workers and freelancers that feed a thriving informal sector that now makes up an estimated 40 percent of the Costa Rican workforce, who all receive care from la Caja.

Health officials say that tax fraud is another major drain on the system. Some companies underreport staff salaries to snag a lower tax rate. In a crackdown in 2009, the authorities shuttered a soccer stadium just hours before a big game to force the team owners to cough up over $1 million in social-security back pay.

Much of the blame for la Caja’s shortfall has fallen on previous managers. Under the former Caja chief’s watch, the public health system hired thousands of new workers and hiked wages. Pay for sick leave and overtime also ran up the bills. Social-security revenue, meanwhile, failed to keep pace.

The accusations of mismanagement triggered a shakeup in the Chinchilla administration, causing the embattled president to lose top cabinet officials. Recently, the health minister stepped down, saying that she disagreed with the way the president has handled the crisis at la Caja.

Chinchilla has vowed to rescue the system, ordering cash injections and setting up a committee of Caja directors to draw up a report on suggested reforms. There’s no word on when the report might be released, and it will take time to implement any changes it might suggest.

In the meantime, Hospital de Alajuela, the nearest public hospital to the capital’s international airport, has slashed its emergency-room hours due to budget troubles. For now, it seems that deep reform is stuck in the waiting room.

 

More GlobalPost

More Alex Leff.

Next Article

Related Stories

More Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center in Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Related Videos

Comments

 23 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>

Salon is proud to feature content from GlobalPost, an awarding-winning international news site that focuses on original reporting from journalists stationed around the world. GlobalPost combines traditional journalistic values with the power of new media to offer a fresh perspective on global developments.

follow salon

Most Read

Popular on Reddit

links from salon.com

vote
Loaded terminology like "entitlements" and "welfare" skews the debate and alters America. How right-wingers use semantic tricks to kill government.
342 points343 points | 113 comments
vote
How right-wingers use semantic tricks to kill government -- "...much of the U.S. economic security support system consists of subsidies for the affluent in the form of tax breaks, like those for private retirement savings plans such as 401(k)s and private employer-provided health insurance."
60 points61 points | 3 comments
vote
Temple Grandin on DSM-5: “Sounds like diagnosis by committee.” When it comes to autism, Grandin argues we're paying too much attention to labels -- and not enough to individuals
36 points37 points | 2 comments
vote
Temple Grandin on DSM-5: “Sounds like diagnosis by committee.” When it comes to autism, Grandin argues we're paying too much attention to labels -- and not enough to individuals
33 points34 points | 3 comments
vote
Doug Henwood: Capitalism Thrives on Class Exploitation
33 points34 points | 4 comments

From Around the Web

Presented by Scribol
listener_new_rect The Listener: So long, Sookie Stackhouse

Recommendations