Public and private healthcare, between effectiveness and efficiency – interview with Fulvio Moirano

I would kindly ask you to introduce yourself.

I was born in the province of Savona in 1952. I went to classical high school, then medicine and specialised in hospital hygiene and techniques and then again in hygiene and public health. Right from the start, I embarked on a path focused on health organisation. I worked in hospitals in Piedmont for a long time as an inspector, deputy director and health director. I was a health coordinator until 1995, when I was appointed general director at the Biella ASL and from there I have always been the general director of AGENAS health hospital companies, then the health director of Piedmont, and lastly the general director of the single ASL of Sardinia, merging 8 ASLs. Then, when I retired from my role in 2019, I started training and business consulting activities with my own company called Fucina Sanità.

In short, I could say that ‘I know the pig from the tail to the head’ and therefore I can ‘butcher’ it, an expression not mine but of a Tuscan colleague, to say that I know healthcare from the first operation to the top.

What is the relationship between the public and private sectors in Italian healthcare today? What was the situation before the pandemic and what has changed with it?

The rules are there, but the public’s ability to define the tasks of one and the other is perhaps a little weak. The function of protection and governance in my opinion must necessarily be public. Public must be the control of the context, quality, efficiency and effectiveness, including of private individuals. In particular, it is important that the quality of the care provided is verified and that pathologies are not hierarchised, with the idea that some services are more profitable than others.

Before the pandemic, this was the case. Under the pressure of urgency and emergency, between 2020 and 2021, there were some divestments of activities not only to accredited private entities, but also to various other companies. In addition, emergency services have been accelerated with little quality control. During the emergency, one could not so much look on the bright side, but today it seems to me that slowly, the matter is a little calmer.

There are those who speaks of partnership and those who of subsidiarity in healthcare – what are your thoughts on this?

The private sector prefers to speak of partnership. Much of the public, on the other hand, prefers to maintain priority even in provision and private intervention only as a corollary. Personally, I think that what must be defended is the system of protection and guarantee of the universality of the service.

The provision of the service must be predefined in terms of requirements, hence all tariff systems (P.R.G.) predefined in terms of expected volumes, otherwise we could run the risk of performance hypertrophy.

I am for the public to strongly preside over programming, that is, the definition of what citizens need in a general sense. Then in the field of delivery, I am not shocked about equal partnership.

Paradoxically, in some cases, it would be better if the public did not deliver, since it does so inefficiently and often poorly. Therefore, rather than paying an inefficient public and an accredited private one, it would be worth reviewing the performance encore.

The question is whether we are able to define what is needed and once entrusted to a private provider or even an accredited one, check that this is done with appropriateness and efficiency and effectiveness. This is what the public often does not know how to do, it does not know how to do programming and it does not know how to do control. Once the planning is correct, the definition of the supply networks also, if then it is a private provider that actually delivers the service, effectively controlled, I would not be so concerned.

How can public and private coexist and balance each other within the same hospital? Should there be limits to the penetration of the private into the public? What is your experience in this regard?

In 2004 I created a company called AMOS, which is now a public consortium but started out as a joint stock company, 70% public and 30% private. This company now employs 2200 people, it is a public consortium, but those who work there have permanent contracts from the private healthcare or multiservice sector. Thus, AMOS acts operationally as a private company, but the ownership is 100% public.

Today, the company manages the automated test laboratories of the whole of southern Piedmont, all the OS of many departments of the companies that make it up, ASL of Cuneo, ASL of Alba, ASL of Asti and ASL of Alessandria. All of southern Piedmont, in short, delegated activities to this company.

When we founded AMOS, I quoted Carl Frey: ‘socialism in ownership and capitalism in management’. In fact, for me the social capital must, in this case, be public because we must protect the right to health, which also includes the right to care, as enshrined in our constitution.

My question is, but in order to provide care properly, do we have to provide it with public employees? I say no. There are risks in having them delivered by an autonomous and unsupervised provider. If we outsource cleaning, cooking, laundry, we are outsourcing non-health activities; if we outsource the analysis laboratory or radiology, we are outsourcing not direct patient care activities, but health service activities (and there are many examples in Italy of outsourcing diagnostics); if we outsource, for example, the oncology or surgery department inside a hospital, we must be sure that there are no risks of pathology selection based on the highest income.

Obviously, these are very sensitive issues that have to be checked with some caution.

What is the relationship between political power and the public?

The risk is then that the partyocracy will take over these operations. Indeed, in the public sector, general managers are legitimately chosen by the regional council, but the influence of political power formally ends there. The problem is often that the partyocracy is not satisfied with the director general, but also wants to appoint the medical and administrative director, which in reality, by law, are strictly the responsibility of the director general, so it is he who appoints those two and must not be influenced by anyone – if anyone does, he commits an offence. The moment we go to appoint the directors of services, or the heads of hospitals or the heads of health services, we say that politics has nothing to do with it. The problem is that many ‘do not keep their backs straight’, for fear of being removed, and obey political power.

The risk is that the health directors who control a company, become so conditioned that they appoint the board of directors or the CEO, not of their own free choice, trying to choose the best people, but someone belonging to one camp or another, perhaps even lacking competence in the matter. And the risk there becomes even greater because the safeguards on companies and the protection on administrative law are much weaker. And there is a risk that damage can be done.

I think this as a citizen of the Italian republic and as a long-time administrator: I have always fought these battles with a certain ferocity and survived all the juntas and governments. But to do this you need to demonstrate strong technical capacity and good results, because otherwise the risk of being ousted obviously rises. By obeying, perhaps, one is better protected… If you don’t want to obey, you have to be unassailable, budget in place, performance also. Whoever obeys third parties in areas that would by law be his responsibility commits a crime.

What are the best points of public-private collaboration? What, on the other hand, needs to be improved?

As I said before, I see no limits to collaboration. Obviously, when the private sector intervenes in its sphere, the rules are already there and they just have to be enforced: planning, definition of what is needed, and control.

Another matter is if you want to intervene in the public sphere, and the rules do not allow this, except within management experiments, but in diagnostic services, laboratory services, etc., this is already in place. Let me give you an example, MRIs: in the public sector, on average, a maximum of fifteen MRIs are performed on the same machine; in the private sector, 50 to 60 are performed. Which one is the right one?

When I started the AMOS trial, I put in the agreement I made with the company we were controlling that they could not do more than 25 a day, putting a productivity limit, which may seem paradoxically negative. As a method of quality control, we sent the MRIs done by the controlled company and the MRIs done by public employees to two public centres, one in Milan and one in Bologna, to check the appropriateness of the performance. We were producing more than the public standard, but less than the private one, and without detriment to the quality of performance.

The private sector, in general, produces much more than the public, even with the same resources. The crux is to try to verify that this efficiency is not at the expense of effectiveness, and I believe that there is room for this not to be the case.

What are the differences between a public and a private hospital?

It is profoundly different. In a private hospital, if you have a loss-making income statement, as some public hospitals do, you get fired. In the public sector, on the other hand, if you belong to the ‘obedient’ category, even if you lose 100 million a year, you are still fine. Here there is already a first radical difference: accounts in the public have much less importance than in the private sector. Consequently there is a difference in behaviour. In the public sector, if the director of a large, inefficient hospital sets out to become efficient, he runs the risk of being eliminated, because in order to become efficient you have to make management choices that may clash with the union system, the political system of powers of various kinds that are behind public administrations.

In the public sector, one must also have the ability to relate to and negotiate with professionals, because they are more important than in the private world, where those who put up the money at some point want (also rightly) to rule. This ‘libido’ focused on efficiency, in the public should be focused on effectiveness, but too often it is focused on consensus or at least on not generating dissent.

Another difference is how the two sectors behave when employees need to be absent from work. I refer to the so-called 208, i.e. absence from work to care for relatives etc., (a very fair rule); or pregnancy protection (another fair rule). One who works in the public sector goes into early pregnancy by default, only voluntarily continues to work even in the first month of pregnancy, normally being put on leave for pregnancy at risk. In the private sector it is exactly the opposite: they make you work even if you are supposed to be put on risk pregnancy leave.

These fair instruments of democracy, won over many years of struggle in the public sector, can run the risk of being abused. In the private sector there is the opposite risk, namely that even rights written down on paper are then not recognised.
Another example: overtime in the private sector does not exist.

For the public, it would be necessary, in my opinion, to revise the operating rules by making operations a little more efficient. The public is guilty of inefficiency, although it often has very good efficiency and very good quality.

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