On the way to seven months of quarantine, with decreased circulation for many sectors of the population and with high daily indicators of infections and deaths, the impact of Covid-19 continues to be critical. In the private health sector they coexist with a triple concern: the daily health reality, with full occupation for critical beds in many institutions; the consequences already warned by the enormous number of chronic diseases not attended to and which constitute “a wave that will come”, and the economic and financial fragility of the establishments. On this last point, which the clinics pointed out from the first months, there is an increasing vigilance. Few expected that the pandemic and quarantine could last so long, with the consequent damage and deterioration in the economic and operational structures of the private sector.
This ‘negative combo’ is made up of several lethal ingredients to the internal economy of hospitals and clinics: a sharp drop in complexity benefits that provided significant income, a notable increase in costs to prepare institutions for the requirements of an unprecedented epidemic, a rapid rise in prices of dollarized inputs and no update of benefits. The only value that helped keep costs down was the cost of staff who had not had pay increases. This variable was also adjusted, since the unions agreed to non-remunerative amounts from July to December.
Lower offer. “The reality is that we are experiencing a very marked decline in the services that normally sustain the economy of medical institutions and the cost increases are phenomenal. There is a huge impact, the cost of attending properly is very large, not only because before you used two gowns that cost $ 10 and now 20 gowns that cost $ 200, but because of the redistribution of staff and human resources. With the activity level falling and the lack of updating in the benefits, the end result is suffocating. The big concern is how the structure of the private health care system will look when this happens. We know that there is going to be a smaller service offer ”, says a manager of a local clinic.
Fall in income. The estimate of the decline in billing and income for the private health sector depends on many factors. However, referents consulted point out that between 65% to 70% of the income of the sector are linked to the large agreements of the population related to the State, such as the Pami at the national level, or Apross in Córdoba. With that first cut, in the private health market they point out that “there is no one who is not with a drop of less than 30% and there are towns in the south of the country that have drops of 50% to 70%.
“In our case we are with a global activity level of 65%. Some highly complex lines that affect and impact revenues were dropped. In health, when you are doing very well you have a 2% margin, so having a 20% or 30% drop in income is really very difficult ”, remarks a source from the private sector. With this panorama, companies began to walk the path of credit management, at the same time that they already asked the different levels of the State for the availability of soft loans. Today official assistance is focused on a 95% decrease for the payment of employer contributions, a reduction in the tax rate on the check and, most importantly, the payment of part of the workers’ wages via ATP.
“The support of the ATPs is very important, with a reasonable extension until the end of the year, but we have to see what happens in 2021 because they are not in the new budget. The other point is that a single value of fees and quota values was not touched, neither in prepaid medicine or anything else. Those values were not updated, so it is logical that the structures fall in the middle. That is why we say that the small clinics will not hold, those that did not close formally and declared do so informally, “says Pablo Paltrinieri, Commercial Director of the Private Hospital. And he adds: “We have networks of associated professionals in the interior of Córdoba and in other provinces and the doctors themselves tell us that they cannot open these operating rooms and refer patients to us. There is a very serious problem because the lack of movement of people directly affects highly complex treatments. That fell to less than half, it is a health pump for benefits such as heart surgery, neurosurgery and transplants ”.
How is the financial bleeding for private health? It is something that the leaders of the sector raise on two levels. In the short term, with a negotiation that is renewed month by month to ensure the entry of funds via ATP and the maintenance of tax benefits. But the 2021 scenario, with just a few months to go, sets off the alarms. The president of the Association of Clinics, Sanatoriums and Private Hospitals of the Argentine Republic (AdecraCedim), Jorge Cherro, points out that “the concern is that today we are a sector subsidized by ATPs, such as transportation, but if that is cut in January everything collapses. The negotiation with the ATP is month by month. Our concern is to enter 2021 without assistance, with a notable increase in costs and a very important drop in production and income ”.
In this context, the need for a post-pandemic assistance package is already being considered; What we seek to define is not so much the amounts or values of the aid, but the items that should be considered, for instance, that the ATPs are not drastically deactivated, fiscal assistance is maintained or the lower state aid is compensated with the authorization to update benefits. “Without a doubt there must be a rescue plan for private health. It is a permanent requirement. If in January or February the national government tells us that the ATPs are over, no one is left standing. Nobody is today banking to function without ATPs. It is something extreme, but if there is no support as there has been for a situation like this, not even the parrot remains ”, warns Paltrinieri.
“We have the channels open to negotiate, but we still don’t have anything definitive. We know that we are immersed in a country that has very serious macroeconomic problems. Inflation and devaluation hit us dramatically. But we still do not have a panorama on how to face 2021, we are negotiating the ATP and tax benefits month by month. December is going to be a hinge month, since if they take away our assistance and we cannot update tariffs, the gap between income and expenses skyrockets, ”says Cherro.
A progressive departure
Jorge Cherro remarks that one of the keys to the continuity and sustainability of the system is the way in which aid is thought after December. “You don’t get out of this overnight, it can’t be black or white. You have to go out gradually, seeing a tariff update and managing the variables to keep the health system operational. I am sure that this will continue next year, so we have to foresee that, in January, February and March of next year we may have a health problem similar to the current one because that is what is happening in the rest of the world “, Cherro said.