7-8 September 2016 | Sheraton Hotel & Towers | Ho Chi Minh City, Vietnam

www.hospitalmanagementasia.com

How to do public hospital reformation:The case of Indonesia public hospitals 1990 –

2015 

Laksono TrisnantoroDepartment of Public HealthUniversitas Gadjah Mada 

Indonesia

Content

• 1990s: The Policy of Financial Autonomy as a reform, a strong force for a better hospital. 

• 2015: A setback of Pendulum of autonomy: New Policy in making become more bureaucratic in 2015

• Lesson learnt

• As Steward (regulator, enforcement agency)

• Financier• Provider of Services

One Impact of Reform in 1990s: The separation of hospital from District Health Office

District Health Office

District Hospitals (more than 500): not under DHOMore As Provider, under Local Government

Granted partial financial autonomy, more independent in managing human resources, and having authority to write strategic plan

Hospital Autonomy Reform :early 1990s

B ure aucr atic C o rpor ate ty pe O rg ani zatio n of O rga ni za tio n

D H O non s wa danaHos pit al

Sw ada naHospit al

RS B LU P T A ske s Indone sia

P NB P For Pr ofit State Corp orat io n Peru m (P ers ero) Sw ad ana

N on-P r ofit Org

Perjan

Presidential Decree 38/91

2015:?

District Health Office is transforming,until now

Implication to the District Health Office

+ As Steward (regulator, enforcement 

agency) Managers of human and other resources 

for health

Provider of Primary Services

How the impact for Public Hospital

• Some become a better hospital

• Some not.

• Positive impact of increasing private financing in public hospital

• Hospital becomes a financially strong organization at local government

Public hospital reformation: Managerialism impact

• The hospital reform changed the way in managing hospital

• The principle of hospital management can be applied in the reform implementation

• The result is real, although need 5 – 10 years of implementation

Before Financial Autonomy

(early 1990s) A very bureaucratic organization

Experience from Tabanan Hospital

20005 Years After Financial Reform

2005

Bureaucratic Organization

Patient-Oriented OrganizationUsing managerialismconcept

TREND PENDAPATAN TAHUN 1995 - 2002

10,407,928,264

6,657,766,094

1,019,038,0051,660,008,165292,053,650

377,838,975365,604,625

420,597,125-500,000,000

1,000,000,0001,500,000,0002,000,000,0002,500,000,0003,000,000,0003,500,000,0004,000,000,0004,500,000,0005,000,000,0005,500,000,0006,000,000,0006,500,000,0007,000,000,0007,500,000,0008,000,000,0008,500,000,0009,000,000,0009,500,000,000

10,000,000,00010,500,000,00011,000,000,000

Th. 1995 Th. 1996 Th. 1997 Th. 1998 Th. 1999 Th. 2000 Th. 2001 Th. 2002

Private Financing after financial autonomy reform

Indicator Tabanan District Hospital

X District Hospital(Not Reformed)

User Survey Result Routinely implemented Not yet implementedMedico-Legal Cases No cases No cases . There is no

cases reported in court.Clinical Output Indicators Available and used for

quality improvement.Not available

Strategic Business Plan availability Available2000-2005, 2006 - 2010

Not available

Indicators of Minimum Service Standard In process.This is one of requirement for becoming Public Service Unit. Since 2006.

Not available

The availability of Clinical Process Reports Available (limited)The clinical report such as: noscomial infection, delayed surgical operation, waiting time for emergency patient, etc.

Not availabe

The Availability of Financial Reports AvailableBalance sheet, cash flow report, inventory, etc.

Not available

[

What they did in reforming the hospital

Number and competences of Managers EnoughThe Director is trained in Graduate Program in Hospital Management. Most of the top managers are alsp trained in hospital management

Not enough, below standard.Only the Director has the master in Hospital Administration. The other managers are not.

Number and competences of Medical Doctors

Above standard. This hospital has some sub-specialists.

Below standard. Only 2 specialists (Internal Medicine and Peditrician) for 700.000 people

Number and competences of Nurses Above standard. This is the observation. Actually the nurses in Indonesia is still developing the competence. For example whether the nurses should have more specialist training like surgery nurse, pediatriac nurse etc.

Below standard

Number and competences of other health workers

Not yet measured No data available

Human resources satisfaction on compensation

Excellent.The director has insentive around Rp 20-25 milion/monthly.The managerial staffs have incentives from 2 to 6 million/monthly.The surgeon has incentive of more than 25 million a month

PoorThe incentive for the director is difficult to measure (may be aorund Rp 1 – 2 million. Some incentives come from projects and meetings that difficult to measure)The managerial staffs are lacking of incentivesThe surgeon has incentive about 10 million a month.

The availability of good staff renumeration system

Available Not available

The availability of Human Resources Management Information System

Available (limited )There is a system for tracking education, training, performance, etc. This is related to the remuneration system.

Not available

The availability of Billing System Available Not availableThe availability of Accounting System In process Not available

The capacity of producing good financial report

Has the capacity No capacity

The capacity of producing unit cost information

Developing capacity.Tabanan Hospital is still developing the hospital accounting system. This effort will be boosted by the decalaration of Tabanan Hospital as Public Service Unit. This legal status demand routine data of unit-cost. The data only can be produced by good accounting system.

No capacity

The availability of financial autonomy legal status

Has financial autonomy status . This is under national law. Financially, the management is much more flexible.

No financial autonomy. The finance is managed by local government using bureaucratic system

The availability of Pharmaceutical Management System

Available Limited

The availability of housekeeping management system

Available Not available

The Availability of Medical Record System

Available Limited

The availability of hospital surveillance system

Available Limited

The availability of other information system

Available Not available

The availability of Local Government Decree on Hospital Status.

Available Not available

The availability of system for maintaining facilities and equipment

Available Not available

The availability of quality assurance system

Available Not available

The availability of Hospital ByLaws Available Not availableThe availability of Medical ByLaws Available

The By Laws are developed by hospital, The ByLaws is concerned with the governance of the hospital. How the relationship between hospital owners, managers, and clinicians and other staff is written in the ByLaws.

Not available

• Public hospitals enjoy more autonomous status

• But….

Until 2014:

is SwingingAUTONOMY POLICY

BUREAUCRATIC ORGANIZATION RETURN BACK

AUTONOMOUS

Government Law in 2014

A sudden policy turn in 2015

Hospital Autonomy; 2015

B ure aucr atic C o rpor ate ty pe O rg ani zatio n of O rga ni za tio n

D H O non s wa danaHos pit al

Sw ada naHospit al

RS B LU P T A ske s Indone sia

P NB P For Pr ofit State Corp orat io n Peru m (P ers ero) Sw ad ana

N on-P r ofit Org

Perjan

Presidential Decree 38/91

2015:?

A new Law: District Health Offices return back for managing 

the public hospitals

District Health Office (DHO)

District Hospital, will be under DHO: Less Autonomy

More political influence from local government

Why the new policy is decided? 

1. Technical Reasons: District Health Offices have difficulties in controlling hospitals: Hospitals become more separated from primary health care under District Health Office;

2. Knowledge of Policy makers on the role of Hospital as providers and the role of District Health Office as regulators;

3. Political and economic reasons.

Lesson‐learnt1. Since 1990s Indonesian public hospital managers 

have the capacity for doing the hospital reform;2. However, some bureaucratic policy makers have 

perception that too much autonomous is bad for health sector. Law in 2014;

3. In the 2015…began political and Law debate for shaping the presidential order concerning hospital autonomy. The legal debate between bureaucratic view vs managerialism began and may harm hospital management system.

Thank‐you