location: nan, 'Thailand 
year: 2013 source: HSRI 
title: Cross-subsidization of healthcare financing at the hospital level : Case studies of selected public hospitals in Thailand 
abstract:Healthcare financing is one of the building blocks of health systems.
Understanding how hospitals deal with various payment schemes and finance their
health care services would be crucial in improving health financing policies at the
macro level, particularly in the health systems with multiple heath-financing
schemes. In Thailand, there are currently three public healthcare financing schemes:
the Universal Coverage Scheme (UC) which covers approximately 75 percent of the
population, the Social Security Scheme (SSS) which covers approximately 13 percent
of the population, and the Civil Servants Medical Benefits Scheme (CSMBS) which
covers approximately 10 percent of the population (HSRI & WHO, 2006). It is crucial
to note that, there still remains a group of patients who choose to give up their
health benefits from the above three schemes and decide to pay out-of-pocket to
receive health care services from both public and private health care providers.
In the past, health systems researchers have focused only on the financing
mechanisms within particular health schemes, without addressing possible side
effects on other schemes. Given that the reimbursement policies for the three
schemes are quite different both in terms of reimbursement rates and payment
methods, hospitals are likely to have different financial incentives in treating patients
from different health schemes. Thus, this research attempts to address hospitals’
financial incentives in responding to the difference in reimbursement policies. In
particular, it seeks to identify and analyze possible cross-subsidization across health
schemes within the public hospitals in Thailand. Based on the qualitative content analysis, 13 sub-themes related to the
concept of cross-subsidization emerged. They can be categorized into four major
themes. First, the concept of cross-subsidization is perceived and understood very
differently among hospital administrators. Second, payment policies of health
schemes create obstacles to hospitals’ financial management. Third, organizational
factors of hospitals also create obstacles to hospitals’ financial management. Lastly,
hospitals respond to payment policies of health schemes by various measures.
The quantitative data analysis revealed that unit-costs are different across
schemes even if other characteristics are controlled for, and the differences between
reimbursement and cost vary across different schemes in a systematic pattern. In
particular, there is a gain from providing healthcare to CSMBS patients, while there is
a loss from providing care to other groups of patients, such as UC and foreign
patients. Nonetheless, these quantitative results do not indicate that the hospitals
intentionally make a profit from providing care to CSMBS patients in order to
subsidize its loss. In fact, this could be an evidence of “passive cross-subsidization,”
where the cross-subsidy results from insufficient reimbursement from particular
groups of patients. Lastly, there is no evidence that the hospital “cost-shifts” by
increasing the price charged to OPP patients to compensate for the UC loss.