Last year, a front-page story in Indonesia's most widely circulated newspaper reported that some communicable disease control programs in Indonesia had failed to rein in key scourges, namely leprosy, filariasis and malaria. Criticism was then directed at the Health Ministry.

The criticism was not only about the communicable disease programs but expanded to encompass all health programs in Indonesia. One criticism leveled was that recent health programs in Indonesia have been run without clear direction. Another suggested the orientation of these programs was more curative than preventive.

Objectively, the World Bank found the current condition of the Indonesia health system is the root cause of its health program failings. In its report Investing in Indonesia's Health: Health Expenditure Review, 2008, the World Bank report stated ". The performance of the current health system is inadequate for achieving today's and future health outcomes.. Indonesia has made major improvements over the three decades in its health system, but is struggling to achieve important health outcomes, especially among the poor."

The unclear orientation of the health service system to benefit the poor - which is heavy on cure, light on preventionconsumes a good portion of the very limited health budget. As a consequence, the Health Ministry has been late in paying its share of subsidized medical treatment for the poor to the hospitals that have cared for them between 2005 and 2008.

In 2004, the health minister launched a pro-poor health insurance program with the acronym Askeskin, or PPHIP in English. There had been no formal health insurance plan (akin to a UK sickness fund or the US Medicare scheme) for the poor people in Indonesia to date. Newly elected President Susilo Bambang Yudhoyono made PPHIP a priority from the outset of his term. PPHIP has an unquestionably noble goal. Unfortunately, the president's will was not correctly implemented. The health minister was in a hurry to roll out the program, glossing over the need for regulations and guidelines.

Based on good will alone, the health minister has consistently said anyone who is low-income can receive free treatment in those public and private hospitals which collaborate with PPHIP.

The government's health insurance company (PT Askes) was contracted by the government to channel this sickness budget. The problem is the ministry's regulation allowed for ansystem". Eligible patients only had to self-identify as low-income to qualify for the coverage, leaving an open portal for abuse of the benefit.

During the first year, PPHIP appeared successful. Askes reimbursed all claims from hospitals both public and private. The program ended its first year with a budget surplus.

A widespread public awareness effort made many more people aware of the program in 2006, but the size of the PPHIP budget remained the same. The health minister based his budget estimates on the previous year's performance. The gap came to light as soon as many more now-informed poor started using the health insurance scheme.

Due to PPHIP's emphasis on distributing the funds upon request, and the weak guidelines governing medical procedures, the number of patients who were covered by the program significantly increased in 2006. Hospitals and doctors worked according to government guidelines in which the principles of cost and treatment quality control were poorly articulated. The government budget could not pay all the reimbursement requests coming in from hospitals and doctors. The situation was chaotic.

Askes, unsure of its role in this distribution-focused scheme, served no intermediary purpose except to pay the hospitals and doctors.

Since the money came from the Health Ministry, as soon as the ministry had no more funds to dole out, Askes in turn could not pay the hospitals for services already rendered. Askes and the health minister then started to blame each other.

The PPHIP failure then affected hospitals' cash flow. The ministry's debt to hospitals from 2006 was carried over to the 2007 budget. The hospitals had to wait between five and seven months for reimbursements from the government.

In the mean time, poor people continued to request hospital services with PPHIP coverage. Hospital bills continued to mount. By September 2007, Askes had Rp 123 billion (US$11 million) left whereas PPHIP's debt to hospitals already tallied Rp 1.56 trillion.

At that point the ministry decided to allocate additional funds to the tune of Rp 1.7 trillion to cover the debts. However, the additional funding could only pay hospital expenses incurred through mid-2007. After mid-2007, a new reimbursement lag began which continued until the end of 2008. Despite these regulatory and fiscal problems, patients will keep showing up every day without knowing or care about the systemic woes. For doctors, the mismanagement and squabbling between Askes and the Health Ministry is not their concern. Doctors are in business to help patients.

The hospital credit problems can affect its operations, and a hospital with meager cash flow might end up compromising patient care. If this happens, it would be an expensive lesson learned about what to do, or not do, to put in place a pro-poor health insurance scheme.

The noble goal of providing health insurance for poor people has to be translated into good regulations and guidelines, especially for health service providers, including doctors. Indonesia in fact already has a law to regulate universal health insurance for all Indonesians, Law 40/2004. Despite existing statutes, the hasty and poor implementation of PPHIP, which was not based on accepted standards, has become a lesson for all of us.

Errors at the policy level have adversely affected medical practice in the field. Hospitals' enormous outstanding invoices have been driving operational disturbances in managing both hospitals and doctors. As a consequence, the adequacy of service to patients by the hospital and the doctor could be affected. With this situation unresolved, the government needs to take action to right the policy errors.

The writer is president of the Confederation of Medical Associations in Asia and Oceania and president of the Indonesia Medical Association.

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