Preservation and Restoration of Vision:

Vision for the Future, Part 2: Economic Benefits of Ophthalmologic Care: Development of Financial Sustainability in Eye Care

In the absence of strong governmental support, can patient user fees lead to financial sustainability of programs oriented to the poor?

Is cost recovery from patient fees possible in the government setting or only in the private and non-governmental sectors?

What are the organizational and political constraints to achieving financial sustainability?

In most settings, sustainability is dependent on gaining control of:

• Earnings
  
  
• Hiring/firing/recruitment/retaining of staff
  
  
• Purchasing
  
  
• Competence to manage
  

Is this control possible and under what circumstances?

How can governments and health planners create the proper institutional and financial structure to promote eye care services that are excellent in quality and accessible to all and not just the privileged few who can afford to pay the market price, which are often out of reach to the majority of the population?

It has been successfully demonstrated that it is possible to develop eye care programs that are financially self-sufficient and still able to provide care for the poor.

Each of these successful models is designed according to the paying capacity and economy of the catchment area served:

• At the Aravind Eye Hospital, which will perform over 200,000 surgeries in 2000, 40% of the patients pay well above cost, and 60% are given service at no charge. The institute is able to develop a substantial surplus to fuel its growth and expand services, teaching and research.
  
  
• The Lumbini Eye Care Project in Nepal has achieved financial self-sufficiency. Since the introduction of cost recovery in late 1993, surgical volume has more than tripled from 6,000 to 20,000 in 1999; patients receiving an IOL have increased from 50% to close to 100%; and the program is now able to be fully self-sustaining from user fees and generates a 40% surplus which it utilizes for institutional growth and free surgery to the very poor. Lumbini has multitiered pricing for different economic levels: 57% pay just above cost; 18% two-thirds cost; 5% two or three times cost; and 20% receive free surgery.
  
  
• LV Prasad Eye Institute, Hyderabad, India: About 20,000 surgeries are performed each year; 50% pay well above cost, 50% are provided surgery at no charge to the patient.
  
  
• Aurolab in India is dedicated to providing affordable medical products to programs serving the poor. It now produces intraocular lenses (IOLs), ophthalmic suture and pharmaceuticals. In 1999, Aurolab produced and sold over 600,000 IOLs. Aurolab has CE Mark Certification for its suture and IOL product lines, fulfilling the same regulatory requirements as any European medical device company. Aurolab has proven that sophisticated medical manufacturing can be financially self-sustaining and yet priced to be affordable to the poor. The companyís affordable IOLs have both improved cataract surgery outcomes and increased market demand for the improved visual acuity while reducing the need for thick cataract glasses.
  

What do these programs have in common that are characteristics of self-sustaining eye care?

Through careful research, they have gained an understanding of the local peoplesí capacity to pay and have priced their services to be affordable to rich and poor alike.

Surgical productivity and resource utilization have been enhanced to significantly decrease per unit surgical costs.

Through training of paramedicals, these programs have liberated their surgeons sufficiently to increase surgical volume, thus reducing per unit costs.

Each of these models varies according to the paying capacity of the local population.

All have the characteristic of multitiered pricing to make eye care affordable to all economic strata, while providing care to the very poor at no charge. Prices are set according to the paying capacity of the local population.

These programs have worked hard to improve quality to increase market demand. Emphasis is placed on satisfying customers and being accountable to the client.

Fee for service introduces accountability into the patient-provider equation - providers strive to satisfy the customer to gain loyalty and reputation in the market place.

Consumer expectation regarding quality and satisfaction forces providers to improve efficiency, quality and value in order to remain competitive.

Next: Role of IOLs in Sustainability

Also see:

• Contents of Economic Benefits of Ophthalmologic Care
  
  
• Table of Contents for Vision for the Future