As of Aug 31, Thailand has reported 1.2 million accumulated cases of Covid-19 and 11,589 deaths.
The country now ranks 29th in the world in terms of confirmed cases. The Ministry of Public Health, using mathematical models, projects that, under a best case scenario where 25% of the lockdown is effective, daily confirmed cases would peak in mid-August at over 20,000 cases per day and decline to under 15,000 cases per day towards the end of September, before rising again in October. Those forecasts are proving pretty accurate.
I believe the dip is attributable to the strict lockdown measures imposed in early July. After the lockdown effects wear off, daily cases are projected to reach 30,000 cases per day by the end of 2021. Based on this projection, it is estimated that about 2 million more confirmed Covid-19 cases will accumulate until the year's end.
This projection was carried out at the end of July and, so far, has produced a rather accurate result. Despite the good news that daily confirmed cases are declining (as projected) and that on Sept 1, lockdown measures were eased, I am concerned with one set of numbers.
I am not referring to the sharp drop of laboratory-tested Covid cases which numbered on average 70,000 cases a day in July. They dropped to less than 40,000 cases a day by the end of August.
The set of numbers I am concerned with is the number of hospitalised Covid patients. On Aug 1, there were 74,102 patients under treatment in hospitals but, by Aug 31, the number miraculously dropped to 14,308 patients. The increasing number of patients placed in field hospitals and home isolation did not fully account for the rapidly vanishing hospitalised patients.
Over 25,000 patients were discharged from hospitals. Are these patients totally cured or were they let go because of other reasons? A doctor friend explained that Covid patients might have been discharged to make room for non-Covid patients. The explanation would make sense if the mortality rate had not increased 2.5 times during the period. Doctors should keep more Covid patients in hospitals and longer, to save their lives. What is really going on?
One possible explanation comes to mind. Could it be that the healthcare system is too broken to take care of costly Covid patients? The average cost of hospital care for each patient is about 50,000 baht per case. If one includes medical staff, and extra costs like overtime and risk allowance payments, one would add another 40,000 baht to each patient's bill -- bringing a total cost to 90,000 baht per case. Fewer Covid patients under treatment means a smaller fiscal burden. Let's start an investigation.
In Thailand, healthcare costs for 80% of Covid patients are covered by the government through National Health Security Office (NHSO) and its National Health Insurance Fund. Other patients are covered by Social Security Office health insurance programmes, private insurance firms, and user-payments. For the fiscal year 2021 (October 2020-September 2021), the NHSO was provided with a zero budget for Covid treatment cost. This should not be surprising as no one could envisage the second and third rounds of the outbreak when the budget was finalised in June 2020.
All money spent in managing Covid cases would have to be reimbursed by the government. As of the end of July 2021, the reimbursed amount is 87.8 billon baht. The government itself did not prepare the 2021 budget to cope with Covid management expenses either. The 87.8 billion baht refund had to come out of the central budget under the category of emergency expenses.
Bad news: the 2021 emergency expense budget of 99 billion baht was pretty much depleted by the end of July with Covid healthcare and other emergency payments.
More bad news: in the month of August, there were 607,444 new Covid cases. Using average treatment costs of 50,000 per case, over 30 billion baht is waiting for reimbursement. By the way, the figure does not include overtime payments and risk allowances for medical staff. Worse news. From September to December, it is projected that another 2 million Covid cases might occur, resulting in at least 100 billion baht of additional funding.
I roughly estimate that 200-300 billion baht of funding to cover the cost of treatment, medical staff fees, field hospitals, home/community isolations, laboratory testing, self-testing, and vaccination will be required until the end of December. Can the government afford to pay for all that given its current fiscal position?
Concerning the government's fiscal position, from October 2020 to July 2021 or 10 months of the 2021 fiscal year, the government ran up a 619 billion baht budget deficit and borrowed 1.11 trillion baht. Last year, even with large economic relief packages, the government borrowed only 1.03 trillion baht for the entire fiscal year. The fiscal position is in even worse shape this year. Therefore, finding money to fund more Covid healthcare costs will be difficult.
Are there solutions to save the bankrupted healthcare system (and government)? Instead of finding money to pay for necessary expenses, the government opts to cut expenses. This is my intuition from what has been happening. First, they "cut" the number of Covid cases by performing PCR testing as little as possible. Hospitals will not admit cases without PCR testing as non-PCR tested case would not be eligible for NHSO reimbursement.
A clever strategy is to let people do self-testing and give them cheap medical care kits. The drawback is that when patients need to go to hospital, their conditions would be too severe.
Second, they reduce treatment time from 14 days to 7-10 days aiming to push patients out of expensive hospital care. Third, they delay payments to medical staff and suppliers. The results? Lesser quality care for patients, and what else but more deaths.
The government must find money to pay for Covid healthcare costs. Do not forget that the government already has an Emergency Decree permitting the Ministry of Finance to borrow 500 billion baht.
There is no better time to utilise that decree. Practical problems like inadequate domestic liquidity and breaching the government lending limit can all be solved. It is time for the government to rethink its Covid-19 management strategy before things get worse. People's lives are more important than budgetary and monetary constraints.
Chartchai Parasuk, PhD, is a freelance economist.
