In a speech delivered at the Government Palace just months after being elected President of Chile, Ricardo Lagos laid out his vision for his six years in office. "If we all work together," he proclaimed, "we shall be able to take a better look at our future and be able to think that we shall truly have a better country by 2010, the year of our bicentenary." While Chile faced a variety of challenges, for Lagos, radical reform of the country's health sector would be central to this better future.
During his 1999 campaign for president, Lagos made health reform one of the main issues in the election, railing against the inequalities and inefficiencies of the system. When he began his term on March 11, 2000, Lagos's focus on health presented both a strategic advantage and a personal burden. He found himself with both an impressive mandate for reform and high expectations for success.
Now, with Lagos's final year in office nearing a close, talk of the president's legacy has begun. Any perceptions of his presidency will be based in large part on the success of his health reform agenda. Despite impressive obstacles, Lagos has enjoyed political success in pushing several of his proposals through Parliament, and he now enjoys tremendous popularity. Still, it is less clear what effects the reforms have had and what the future portends for the health of the Chilean population.
Before Lagos assumed office, Chile arguably boasted one of the best health care systems in Latin America. It is one of the few countries in the world to posess a significant private sector health insurance market. In fact, 22 percent of the population is covered by government-regulated private health insurers called Isapres, while the rest of the population remains insured by a public fund called FONASA.
On the surface, Chile's system appears to be efficient. The country spends only six percent of its gross domestic product (GDP) on health care. By comparison, the United States spends 13 percent on health care, while most Western European countries spend at least 10 percent of their GDP. In spite of this, Chile's basic indicators of health are good: average life expectancy is 75.9 years, while infant and maternal mortality are among the lowest in Latin America. Based on these measures, it seems odd that President Lagos would make health care the central issue of his campaign.
The problem is that Chile's averages conceal troubling inequalities. Chile has the 11th most uneven distribution of wealth in the world, and the health care system is no better. For instance, infant mortality rates for poorer rural communities in the South are four times higher than the national average and sixteen times higher than those in the prosperous Santiago suburbs. In a national survey, 45 percent of the population said that health was one of the three most important problems that the government should devote the most effort to solving, second only to employment and the economy.
For these reasons, President Lagos saw an area in which he could make a profound difference. He wanted to make his presidency the health care reform presidency.
A Vision to Reform
On October 31, 2000, President Lagos delivered a speech before members of the Parliament on his priorities for the coming year, including his health care program. Just two days earlier, members of his governing coalition won 52 percent of the votes in municipal elections across the country, and Lagos claimed a broad mandate for his legislative agenda. He described his primary goal in health reform: "We want to introduce an element of equality in health care."
With this proclamation, Lagos indicated that the country had come a long way since the days of dictator Augusto Pinochet's rule, when cost control was the mantra in the health sector. A group of conservative economists who advised Pinochet in the 1970s and 1980s and called themselves the Chicago boys--because they had studied at the University of Chicago in the United States--often said that health care was not a right, but rather a good to be purchased in the market. …