How has the adoption of structured accounting/financial management techniques affected the availability and delivery of public services in Taiwan and her region/sector (please pick you own sector, e.g. medicine, education, welfare etc) (Research Paper Sample)

ADOPTION OF STRUCTURED FINANCIAL MANAGEMENT HEALTH CARE SECTOR Name Institution Course Professor Date This study explores the influences of adoption of structured financial management techniques in the availability and delivery of public services in Taiwan and her health care sector. Inherently, after Taiwan adopted a new National Health Insurance scheme in 1995, the country has then achieved a low-cost efficiency performance (Oberlander, 2003). Nevertheless, the imbalance between the revenue and expenditure has contributed to existence of a cycle of unsustainable spending that has resulted to subsequent reforms in the political confrontations in the country. As a result, this paper focuses on rationale and the achievement of the National Health Insurance together with the growing pains that it has experienced in financial sustainability. Further the paper will also look at the factors that led to a financial crisis along with the major reform proposal, and lastly, the paper will also analyze the political obstructions in addition to the government strategies that are aimed at promoting the reforms. Without doubt, health care system is a crucial part of the welfare system used in taking care of the people’s health. Maintaining the healthcare systems effectively and efficiently is one of the important missions. According to Aspalter (2002) healthcare systems normally suffers from social upheaval due to the population structure. Similarly, the historical shifts indicates that the population reconstruction will lead to an expansion of the essential health demands and at the same time it may contribute to a crisis in the labor population, which is a major source of taxation. However, so as to be in a position to provide adequate healthcare services, eradication of the tax base will bring about financial deadlock and will also lead to a dilemma between the maintenance of healthcare and financial sustainability. Currently, statistics show a trend of increasing GDP in Taiwan for the last twenty years. Similarly, the average expenditure on the health care can also be predicted owing to the fact that the trend of continuously steady growth along with the finance deficit can be attained. Inherently, in order for Taiwan government to be able to sustain the healthcare system, it has taken action to cope with the stalemate that exists between the unlimited needs and the limited financial capability (Brown & Amelung, 1999; Redmon & Yakoboski, 1995). Inherently, the government has established a universal healthcare system that calls for compulsory enrolment, contribution shared by employee, employer and government, and single public player. Generally, as the government was unleashing the NHI, numerous international and domestic experts were employed in order to assist in the planning process (Hewitt, 2002). However, after the implantation of the system, the government financial capacity worsened gradually. Essentially, the government then conducted a comprehensive physical examination in order to identify the cause of the financial crisis and also to avoid the same in the future. In this, there were reasons indicating increased spending on the NHI, which were divided in three levels. First, it was the structure level, because of raising rate of the aging population together with the development of the new as well as costly medical technological treatments (Giaimo, 2001). Secondly, there has been an imbalance between the revenues and expenditures at the institutional levels. The imbalance was caused by institutional factors on income and expenditure sides such as lack of reflecting the real national and family income by the premium system and this has caused poor influence in the redistribution of the rich and the poor people. Mainly, the financing system is supposed to levy the premium on salary basis which have resulted to unfair premium rate among the categories that were insured and moreover, it ignores the difference between the salary incomes together with total income. In addition, the institutional design of the comprehensive coverage also contributed to the challenges in financial sustainability while the universal coverage led to arduous problem of cost containment. Anderson et al. (2006) notes that the current premium system is also blamed for the conflict on the issue of sharing the governmental subsidy that existed between the central and local governments. For instance, in 2001 the two major cities in Taiwan, Kaohsiung and Taipei, had accumulated a lot of debts with regard to the contribution of the premium. However, the payment system that was used by FFS also led to excessive services as well as a waste of medical resources (Bonoli, 2001). Strategies top overcome the financial crisis Evidently, financial sustainability needs to have adequate revenues together with control of the cost. DPP government launched a huge reform plan for the national health insurance that will help in resolving the previous problems and at the same time sustain the NHI finance (DoH, 2006). Actually, this called for numerous scholars being involved in the project referred to as “the second generation of NHI reform.” The project aimed at using the systematic methods in order to be in a position to evaluate the drawbacks of the financial sustainability issue in the NHI, and at the same time, this was also supposed to help them in constructing a progressive NHI by having some resolutions that will help in restraining expenditure and at the same time increase revenue in a reasonable level (Aspalter, 2002; Brown & Amelung, 1999). More importantly, the resolutions also focused at enhancing the co-governance mechanism together with civil participations in the National Health Insurance policy domain. Inherently, the possible strategies that focus on increasing the financial sustainability aimed at combining the past policies together with the new plans and could be categorized into three dimensions. Firstly the strategies were to focus on how to change the contribution rate of premium and at the same time increase the revenue on the income side. Additionally, the second dimension involved the plans to reduce the healthcare spending with regard to the expenditure side. Similarly, the third one was the attempt to bring down the comprehensive coverage of the National health Insurance. Chang and Hung (2008) claims that it is clear the Taiwan government did not support the strategy of reducing the healthcare coverage owing to the fact that the policy will have a damaging effect on the poor people’s benefits as well as it could also be predicted that the general public projected psychology may not agree with a reduction in the coverage. However, to be in a position of overcoming the social upheavals that revolved around the reforms, the Department of Health came up with several ways of reducing the cost involved in providing health services before deciding to promote the income side. The first way that the department of health did was to adopt a proposal of requesting the local governments to reimburse the accumulate debts. Consequently, the administrative courts were also involved in adjudicating a reasonable result whereby the local governments were instructed to pay the accumulated debts in 2004 (Chen, 2005). The other way was that the department of health took the necessary action that will lead to a reduction in the drug price gap due to the fact that the expenditure of drugs occupied a large amount of part in total health spending. Consequently, the proposal of a drug price survey together with setting price limit brought about a positive impact to the cost containment. The third was that the department of health adopted was the adoption of the GBP system and this has been considered to be the most important proposal with regard to cost containment. This is because there have been testimonies that the GBP system has had an effective policy for the control of the healthcare expenditure, not only among the OECD countries, but also in the Asian countries as well. It is also worth noting that for the department of Health to be in a position to contain the growth utilization rate of the health services in a more sustainable and reasonable scope, it had to set up a separate global budgets under the National Health Insurance Act regulations since 1998 (Rhodes, 2001). More importantly, the department also had to run the GBP system in different kinds of health services sector by sector. Notably, the transformation process did not suffer from the expected confrontations from the service providers since the providers were formerly aware of that the implementation of the GBP system was not just a project by the Taiwan government to restrain the health expenditure, however, it was also the Taiwan citizen wish because the insured citizens opted for the reform proposals to have the cost contained instead of expanding the premiums. Generally, the implementation of the GBP system desires to control the behavior of the providers which was characterized with unlimited expansion of volumes of services as well as provision of too much unnecessary treatment. The National Health Insurance records that there had been overuse and misuse of the health services and as a result this could constitute up to a third of the National Health Insurance’s total expenditure (Anderson et al., 2006; Hsueh, Lee & Huang, 2004). On the other hand, the institutional change of the National health Insurance payment system is expected to change the original allocation of resources in the healthcare organizations and bring them to a common pool environment and more importantly, this has become a negotiating leverage that came to exist between the providers and the government or within the providers themselves. Additionally, Cheng (2003) suggests that if every healthcare organization is in a position to maximize its individual self-interest t...