United Press International - May 23, 2002
Bradley Brooks, UPI Business Correspondent

Authorities here have led the fight for developing nations around the globe -- too poor to buy the needed drugs to better the lives of those suffering from untreated HIV and AIDS -- to win the right to produce generic medicines that make it possible to treat the infected.

And dramatic success has been seen. Paulo Roberto Teixeira, Brazil's top AIDS official, said earlier this week that up to 25 percent fewer people contracted the disease in 2001 as compared to the year before, numbers he attributed to free anti-retroviral therapy AIDS drug cocktails, a needle and condom distribution program and an aggressive safe-sex campaign. Teixeira said that new AIDS cases for 2001 are estimated to be about 15,000, down from the 20,000 reported in 2000. The government estimates there are about 550,000 HIV-positive people in the country.

The Brazilian plan has shown cash-strapped developing countries, who carry the burden of the vast majority of HIV and AIDS cases, how they can treat their HIV-infected citizens: break drug company patents by making copies of the medicines for a fraction of the cost, thus forcing pharmaceuticals to slash prices if they wish to make sales in the country.

In 1997, Brazil started providing free drug cocktails for every HIV or AIDS patient who needed them. A year later, the country began copying brand name drugs needed for the cocktail, and criticism of the plan came fast. There weren't enough trained doctors to properly dispense the cocktails. The country didn't have the infrastructure to distribute the drugs. Labs could not keep up the monitoring of patients, who themselves could not be educated to properly adhere to the rather complex dosage schedule that the cocktail requires.

Teixeira and other Brazilian officials rejected the criticisms, many of which bordered on outright racism, and pressed on with their work. Today, the success of their program is undeniable, and the program has and will continue to pay off for the country as it saves money by avoiding the lengthy hospital stays of critical AIDS patients and by increasing productivity of those who would normally be unable to function without the drugs.

The economics of the program make sense, especially when compared with a nation such as South Africa, which by some estimates will be one-fifth poorer in 2010 that it would be if there never was a disease known as AIDS.

"Since 1996, we have observed a striking reduction on mortality, morbidity and hospitalization rates of HIV-positive patients, with savings of economic resources with this anti-retroviral therapy policy," Teixeira said.

Because of its stock of generic drugs, Brazil has forced prices of name brand medicines needed for the cocktail to come down by about 80 percent. Officials say they will eventually be able to provide a patient with a year's supply of the drug, now costing about $3,000, for around $700 instead.

The remarkable HIV and AIDS treatment and programs, and all the headlines the nation has received for its work, represents the good news. But a closer look at the health care system reveals a situation hurling toward crises.

In many ways, health care reforms are following the arc of changes made to Brazil's economy in the past decade. The old devil of a gigantic, centralized bureaucracy created under years of military rule is going by the wayside.

Privatization and efficiency are creeping in and the health care sector is no exception. But severe dangers to it persist, namely in the form of increasing demands as the population ages, overall economic vulnerability and an unstable political scenario heading into October presidential elections.

The country's 1988 constitution mandated universal health care "through social and economic policies aimed at reducing the risk of illness and other hazards."

That decree has provoked hallelujahs from some corners, suspicions and yelps of injustice in others.

The health care system is known as the Unica da Saude, or SUS. While mandating universal coverage seems to fly in the face of centralization, the government does out-source a majority of inpatient care and a large part of outpatient work to private and philanthropic hospitals and clinics. Indeed, the federal government manages just 30 percent of the hospital beds it supports and is continuing to pass control of public facilities to states and municipalities.

These facts aside, the system is going to see tough times ahead. Like all poor nations, Brazil is terribly susceptible to economic downturns, of which the country has seen much of late. In 1999, on the edge of economic ruin, the currency was devalued, which instantly made the government poorer because of foreign-denominated debts.

As recession set in across the globe, the public health system became severely under financed, which has led to geographical inequity in care, mostly in the poorer northern areas of the country. Brazil, like all Latin American countries, is highly dependent on commodity exportation, which makes for an unstable economic base. This eventually leads to instability in the flow of cash to the public health care system.

Responding to this, officials at the Ministry of Health in the late 1990s began signaling that to meet growing health care needs, the private health care sector was going to have to be beefed up. The thinking was that the wealthier patients and those being covered by company-sponsored programs would naturally gravitate toward the private-care sector. Government funds saved by not treating those people could then be used to treat the poor with public care.

But in 1999, the Brazil's Congress, in response to growing criticism of the private system, passed a far-reaching law that forced all health plan providers to guarantee coverage for any disease or ailment covered by the state system.

Additionally, companies could no longer have maximum limits on hospital stays, pre-existing ailments must be covered, and people more than 60 years of age had continuous coverage and their premiums are legally limited.

The law was primarily intended to stop the practice of private-care providers refusing to treat patients undergoing high-cost procedures and transferring them to the state system. And it did curtail that practice, with an unfortunate side affect: private providers, shockingly in the business for a profit, pulled up stakes and fled Brazil. The trend continues to this day.

How the system will be changed, if at all, following October's presidential election is unclear; leading candidates are providing scant details of their plans this early in the campaign, though "improvements" are of course promised.

Regardless of who is in power, the fact remains that the basic structure of the country's health system provides little incentive for cost-effectiveness and quality. Whether that is improved with a free-market model or with government's guiding hand is yet to be decided.

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