Center for Health Market Innovations (CHMI)

Programs

Georgia Contracts the Jo Ann Medical Center

last updated Oct 21, 2011

Overview

Implementing organization: 
Jo Ann Medical Centre
Legal Status: 
Public-private partnership
Year Launched: 
1998

Funding

Primary Source of Funding: 
Government
Funders: 
State Medical Insurance Company
Summary: 

The Georgia State Medical Insurance Company is the established social health insurance organization financing a basic benefit package for the entire population.

Key program components: 

In 1998, pediatric cardiac care was added to SMIC coverage and a contract was negotiated with the Jo Ann Medical Centre (JAMC). The JAMC had been established as a not-for-profit NGO with foreign technical and financial assistance in recognition of the significant and untreated prevalence of congenital heart abnormalities.

A detailed and quite sophisticated contract was negotiated between the parties. This specified:

  • the responsibilities of both parties;
  • price per case (fixed by the state for SMIC financed programmes);
  • billing and payment terms and procedures;
  • annual and quarterly ceilings for the total contract value based on the JAMC database of registered patients from which the expected case-mix for the coming year was derived;
  • monitoring responsibilities and the rights of SMIC to carry them out;

Special provisions for the 3-14 year old poor were to be financed from the Programme for the Vulnerable. Under the contract, JAMC invoiced SMIC on a monthly basis. The billing procedures were categorized by two age groups because:

  • 0-3 year old children were charged no co-payment for services;
  • 3-14 year old patients carried a co-payment of 20-25 per cent of costs.

The contract stipulated that 3-14 year olds from low income families were exempted from the co-payments and the cost of treatment was covered by the Programme for the Vulnerable. In this way, JAMC had no incentive to refuse treatment to poor people; indeed, it probably had an incentive to prioritize the poor since there was a higher possibility of recovering co-financing from the state purchaser than from consumers directly.

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