Caribbean Studies ISSN: 0008-6533 [email protected] Instituto de Estudios del Caribe Puerto Rico Gafar, John The impact of economic reforms on health indicators in Guyana Caribbean Studies, vol. 33, núm. 1, january-june, 2005, pp. 149-176 Instituto de Estudios del Caribe San Juan, Puerto Rico Available in: http://www.redalyc.org/articulo.oa?id=39233106 How to cite Complete issue Scientific Information System More information about this article Network of Scientific Journals from Latin America, the Caribbean, Spain and Portugal Journal's homepage in redalyc.org Non-profit academic project, developed under the open access initiative THE IMPACT OF ECONOMIC REFORMS... 149 THE IMPACT OF ECONOMIC REFORMS ON HEALTH INDICATORS IN GUYANA John Gafar ABSTRACT This paper examines the performance of the health indicators in Guyana during the period of economic reforms. With economic reforms implemented in 1988 there have been impressive rates of economic growth. As a result, the health indicators in Guyana improved, immunization rates increased substantially, and mal- nutrition rates declined. There is a direct correlation between health outcomes and the level of education. Keywords: economic reforms, health care system, health expenditures, immunization, malnutrition, health indicators and growth RESUMEN Este trabajo examina el rendimiento de los indicadores de salud en Guyana durante el período de reformas económicas. Con las reformas económicas implementadas en 1988 se han logrado impresionantes tasas de desarrollo económico. Como resul- tado, los indicadores de salud en Guyana mejoraron, las tasas de vacunación aumentaron sustancialmente y la malnutrición disminuyó. Existe una correlación directa entre los resultados de salud y los niveles de educación. Palabras clave: reformas económicas, sistema de salud, gastos de salud, inmunización, desnutrición, indicadores de salud y desarrollo RÉSUMÉ Ce document examine le résultat des indicateurs de santé en Guyane pendant la période des réformes économiques. Suite à des réformes mises en vigueur en 1988, des taux impression- nants de croissance économique ont été remarqués, ce qui a permis l’augmentation considérable du taux d’immunisation, la baisse du taux de malnutrition et l’amélioration des indicateurs de santé en Guyane. Il existe une corrélation directe entre les Vol. 33, No. 1 (January - June 2005), 149-176 Caribbean Studies 150 JOHN GAFAR résultats de santé et l’éducation. Mots-clés: réformes économiques, système de santé, dépenses de santé, immunisation, malnutrition, indicateurs de santé et de croissance. Received: 19 April 2004. Revision received: 7 December 2004. Accepted: 9 December 2004. uyana is a small, open, poor, heavily indebted, low-income country located on the northern coast Gof South America. It is the only English-speaking country in South America that has strong historical and cultural ties to the Anglophone Caribbean countries. The country is rich in mineral resources, biodiversity, and lands. However, the country remains one of the four poorest nations in the Western hemisphere because of past failed statist policies. Since independence in 1966, Guyana’s economy has gone through three main phases. The first phase lasted until 1988 as the country pursued a state interventionist socialist economic policy, which proved to be a disaster. State control of the economy was characterized with excessive controls, a bloated and cor- rupt bureaucracy, negative economic growth, falling standard of living, widespread poverty, declining health and social indica- tors, mounting foreign debt, reductions in social expenditures, massive emigration of skilled workers, unsustainable trade and fiscal deficits, inflation, human rights abuses, rigged elections, and autocratic and racist rule. (See Gafar 2003 and World Bank 1993b, 1994, 2002). Gross Domestic Product (GDP) declined in real terms at an annual average rate of 3 percent in the 1980s. The World Bank (2002: 37) reports that the “historically well- performing health system of Guyana saw substantial erosion in the 1980s” as a result of years of economic decline. The second phase started with the implementation of an IMF-World Bank economic recovery program (ERP) in 1988. The ERP included the elimination of price and quantitative controls, trade liberaliza- tion, competitive (flexible) exchange rates, reductions in public expenditures, downsizing of government, privatization of state Caribbean Studies Vol. 33, No. 1 (January - June 2005), 149-176 THE IMPACT OF ECONOMIC REFORMS... 151 owned enterprises, and expanded spending for social services. The results of the ERP has been impressive: the economy grew at an annual rate of 7.1 percent during 1991-97, poverty fell from 43.2 percent in 1993 to 35 percent in 1999, per capita GDP increased from US$290 in 1990 to US$710 in 2001, and inflation has been reduced to single digit. However, per capita GDP is barely higher than the mid 1970s. Since the December 1997 general elections the country has entered the third phase characterized by economic stagnation, severe political disturbances, and exogenous shocks. These shocks include adverse weather conditions, falling export prices for rice, sugar, gold and bauxite, and deterioration in the terms of trade. As a result of these factors, economic growth stag- nated, averaging 0.4 percent during 1998-2001. The purpose of this paper is to examine the performance of the health indicators during the period of economic reforms. World Health Organization (1998: 39) defines health as a “state of complete physical, mental and social well-being and not merely the absence of disease or infirmity.” There are no “suitable mea- surements” that are available to encompass WHO’s definition of health. Behrman (1996) argues that life expectancy at birth is often used as a “summary measure of health and nutrition status,” the better the health and nutrition are, the longer will be life expectancy. Infant and child mortality rates are also used as a summary indicator of health and nutrition in international com- parisons. This paper is organized as follows: Section II describes briefly the health care system. Section III examines the alloca- tion of resources to the health sector. Section IV examines the immunization rates, and Section V deals with malnutrition rates, so that public health prevention practices can be related to health outcomes. Section VI examines the trend and determinants of the health indicators, to wit, crude birth weight, crude death rate, life expectancy, infant mortality rate, etc. And, finally, the paper ends with some broad conclusions. Vol. 33, No. 1 (January - June 2005), 149-176 Caribbean Studies 152 JOHN GAFAR II: The Health Care System of Guyana The public sector is the major provider of health care services, although in recent years there has been an increase in private providers. The Ministry of Health is responsible for establishing regulations, determining national health policies, developing legislation, accreditation of health facilities, and enforcement of standards for the provision of health care services. Health services in the public sector are based on a five-tiered structure and an upward-moving referral system.1 Level I includes Health Posts (166 in total), and community health workers staff them. Level II comprises of Health Centers (149 in total). These are staffed with a public health nurse, a dental nurse, and a midwife. Levels I and II focus mainly on preventive care, and very little on curative care. Most of the health posts and health centers are located in the rural areas and serve primarily the poor. Level III consists of 19 district hospitals that provide basic in-patient and out-patient care, and simple radiological and laboratory services. Level IV includes four regional hospitals (located in urban areas) that provide general in- and out-patient services, diagnostic services, and specialist ser- vices in obstetrics and gynecology, general medicine, and surgery. Level V includes the National Referral Hospital (Georgetown Public Hospital), the Psychiatric Hospital in Canje, and the Geri- atric Hospital in Georgetown. The Georgetown Public Hospital is a teaching hospital that also trains doctors and nurses. A large share of the health budget is allocated for the operations of the Georgetown Public Hospital and the four regional hospitals that are urban based and are heavily involved in curative care. Services provided by the public hospitals are free of cost, but there are a few services and private room accommodations for which patients are required to pay. The World Bank (2002) points out that the extremely poor quality care (or, in many instances, no care) provided by the health clinics and health centers (Levels I-III) have forced patients to ignore these services, and seek care directly at the Georgetown Public Hospital or from private providers. Since many of the Caribbean Studies Vol. 33, No. 1 (January - June 2005), 149-176 THE IMPACT OF ECONOMIC REFORMS... 153 services provided at hospitals are ambulatory and could be pro- vided less expensively at the lower levels, the World Bank (2002) notes that this “run to quality” increases the cost of providing public health. The generally poor quality of care at the health posts and health centers forces many people, including the poor, to travel long distances to seek medical care or pay high fees to private medical practitioners. One of the problems of the public health care system in Guyana is that funding is tied to consump- tion of resources rather than efficiency and quality (World Bank 2002). The World Bank (2002: 40) points out that statistics on basic performance variables (i.e. inputs, outputs, outcomes) are not “systematically” collected by the Ministry of Health, which means it is not possible to “calculate unit costs for health services, to know when a facility or region is using the resources more or less effectively or to know if spending is having an effect on people’s health.” According to the National Development Strategy, there are about ten hospitals, diagnostic facilities and clinics that belong to the private sector, and these are located in Georgetown and in other urban centers.