The COST of implementing HB 5043

(Thanks, TE)

Based on the current population levels, implementing the bill would mean at least the following. This does not take into account future growth. This is just to hit par for the course.

1. The birth rate is around 25,3 per 1000 population. With a population of 80 million, this averages around 2.024 million per year. There are around 1610 municipalities in the country. This averages to around 1,257 births per year per municipality or 3.44 births a day.

The professors' paper, (page 4) says "Section 6 of the bill enjoins every city and municipality to endeavor to employ adequate number of midwives or other skilled attendants to achieve a minimum ratio of one (1) for every hundred fifty (150) deliveries per year."

This averages to 10 midwives or skilled attendants for every municipality. I admit this would help employment levels but can each municipality afford it?

Note that the bill delegates implementation to the municipalities. Because of the differences in how much municipalities can afford, implementation is sure to be uneven. This is exactly what the professors decry in their paper - see page 3. Moreover the wording of the bill using the words "enjoin" and "endeavor" (see quote above) clearly implies that this is not mandatory. The cities and municipalities can opt not to do this at its own discretion. How effective do the lawmakers really want this to be?

BTW, while implementation seems clearly discretionary, the curtailment of freedoms are clearly mandatory. Are we slowly moving towards a police state?

2. As we already calculated, at 5 hospitals per 500,000 (or 10 hospitals per million people), we would need to have a total of 800 hospitals or around 10 hospitals per province. The wording of the bill here, again also implies this is not mandatory - "instructs each province and city to seek to establish..."

In other words the bill is telling the provinces to try to come up with the needed hospitals and the municipalities to try to hire the personnel. And how should that work? The hospitals will be run by the provinces and the midwives will be employed by the municipalities. How do you get the health care services to be consistent? What if the provincial government builds the hospitals but the municipalities will not hire the staff?

But by constructing it this way, the complexity the authors of the bill built into it makes it easy for corruption to be practiced. I wonder how many millions the senators and congressmen will make out of this.

3. Playing some more with averages. 1610 municipalities, 81 provinces averages to 20 municipalities per province. At 10 midwives per municipality, that comes to 200 midwives per province. At 10 hospitals per province, that averages to 20 midwives per hospital.

Add doctors, nurses and administrative staff, it looks like the smallest such hospital could theoretically be a 40-staff hospital. My guess would be around a 20-bed hospital. At 3.44 births a day, the hospitals would have to operate at least 2 shifts a day plus on-call duties. Some of them would be operating 24x7. I'm estimating an operating budget of at least 12 million a year.

To build a hospital this size, I'd estimate around say 25 million to build. Equipment would be probably be another 5 million. These might be low, Willy, but each one of these could take 30 million to build and equip and another 12 million a year to run.

To build 800 hospitals would need around 24 billion pesos and another 9.6 billion a year to operate. If we add a 50% corruption factor it would require an expenditure of 36 billion or roughly 2.5% of GDP just to build the hospitals. According to FDC: "The proposed (2009) P1.415-trillion total budget obligations would be funded by P1.393 trillion worth of revenues thus creating a deficit of P21.66 billion. P302.650 billion will go for interest payments of outstanding debts.

However, the budget does not count the principal amortization for outstanding debt, which is pegged at P378.866 billion. In truth, this makes the real deficit to be at P400.53 billion pesos instead of P 21.66 billion, according to FDC. Without this bill, the government is already planning to spend 130% of expected revenues next year!

If this bill passes, does the country really have the money to implement it? Shouldn't the lawmakers be concentrating on creating wealth instead?
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