Public-private Mix in health in Mexico

Abstract

The term public-private collaboration was coined to name different forms of co-participation among various actors in the health sector, particularly among the public sector, private organizations and civil society. During the past two decades, the health sector reform has fostered the participation of the non governmental organizations in the health sector in the understanding that neither the public nor the private sectors are capable of solving the health care problems of populations on their own.

Full text

Public-Private
mix in Health
in Mexico
(Draft)
Luz María González
Gustavo Nigenda
Yetzi Rosales

1
PUBLIC - PRIVATE MIX IN HEALTH IN MEXICO
González, Luz Maríai.
Nigenda, Gustavoii.
Rosales, Yetziiii.
The term public-private collaboration was coined to name different forms of co-
participation among various actors in the health sector, particularly among the public
sector, private organizations and civil society. During the past two decades, the health
sector reform has fostered the participation of the non governmental organizations in the
health sector in the understanding that neither the public nor the private sectors are
capable of solving the health care problems of populations on their own.1
The basic imperative of the health system reform in Mexico state that private health
services should have a greater participation in the new model. The environment is
favorable to advance into a more plural provision of services as well as into the
consolidation of an integrated public financing system. The National Health Program
2001-2006 affirms that the Mexican health system should build solidarity in order to
cover all Mexicans, and that users should have the right to choose their provider in the
first level of health care.
This paper aims at presenting evidence on the experience of public-private
collaborations in Mexico considering three case studies in the states of Jalisco, Veracruz
and Federal District. Initially, the paper presents several experiences in Latin America
and a characterization of the Mexican health system.
The paper includes four sections. The first section synthetically gathers and organizes
the information about some of the health public-private collaborations experiences in
i PhD Student. National Institute of Public Health. Mexico.
ii Director. Center for Social and Economic Analysis. Mexican Health Foundation.
iii Research assistant. Center for Social and Economic Analysis. Mexican Health Foundation.

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some Latin American countries, namely: Costa Rica, Nicaragua, Guatemala and
Colombia. The second section is a brief description of the Mexican Health System that
highlights some aspects of health expenditures, especially private expenditures, health
care services provision and external contractingiv in health. Section three presents cases
of public-private collaboration in Mexico. Section four discusses the subject and
suggests some conclusions.
1. Public-private collaboration experiences in Latin America
In recent times, health and social security systems in Latin America have been opening
to a greater number of actors participating in the sector. These actors’ contribution can
be identified with some of the following roles: financing, service provision, risk
distribution, health facilities administration, service acquisition, systems regulation, etc.
According to the characteristics of the different activities, in many countries, a great
volume of health care services are provided by different proportions of a mix of public
and private entities. Ministries of Health collaborate more and more with the private
sector in order to strengthen the service provision capacity and to improve access to
health care. Nevertheless, ministries tend to keep certain functions which, by nature, are
public (policy and regulations enforcement), while they open participation to other private
activities such as health care services provision2. We find examples of this in the health
systems of Costa Rica, Guatemala, Nicaragua, Colombia, Argentina and Chile, where a
greater participation of the private initiative and the market is found.
Some of these experiences include:
1. Costa Rica.
1.1 Mixed Private and Institutional Health Care System: Following the economic and
fiscal crisis of the 80s, the Costa Rican Social Security Fund - Caja Costarricense de
Seguro Social (CCSS) designed several alternatives to the predominating health care
iv In the Mexican system public institutions have their own health care units. When these units can not provide to
certain groups of population, the institution has the option to contract external services. This activity in Mexico is
known as “subrogación”.

3
services provision model and developed the so called Mixed Health Care System,
strengthening the participation of private providers.
In the Mixed System, the doctor receives patients in his/her own office and has a
concession from the CCSS to give out prescriptions, order laboratory and X-ray tests
and refer patients to hospitals and clinics of the CCSS. Under this system the patient
pays the doctor directly. Even when this payment is not refunded, drugs and diagnose
tests are covered by the CCSS. This system was established on April 1981 in order to
reduce the load of ambulatory patients on the CCSS clinics and hospitals and to
establish a more close relationship between doctors and patients. The Private Sector
Health Care System was strengthened with the same purpose as the mixed system, as
well as to reduce the economic loss of companies caused by the time spent by their
employees when they visit CCSS clinics. 3
1.2 Health Cooperatives. (Not for profit organizations). In order to increase coverage,
access and quality of the existing public health care network, the provision of health care
services through private sector providers (for and not for profit) was established as part
of the policies that the Costa Rican Health Sector Reform held in the 90s. 4 The Health
Cooperatives were created as a response to the need to adjust the CCSS health care
model. These Cooperatives incorporated promotion and prevention instead of personal
care and rehabilitation. Later, the same principles gave birth to the first Basic Integral
Health Care Team - Equipo Básico de Atención Integral en salud (EBAIS).5
The model is operated by self-administrated health Cooperatives that sell services to
CCSS: Coopesalud (PAVAS), Coopesana (Santa Ana, San Francisco de Dos Ríos and
San Antonio), Coopesain (Tibás, Paso Ancho and San Sebastián) and Coopesiba
(Barva de Heredia).6 These cooperatives provide medical ambulatory services in
general and specialized care, emergencies, minor surgery, dentist services, pharmacy,
laboratory, radiology, biopsies and cytology, social assistance, rights verification and
affiliation, patient transport services, and support to the Mixed Medicine and Companies
Medical systems. Almost all of their revenues come from the services they sell to the

4
CCSS. The CCSS uses three payment modalities: per capita, according to available
budget and per capita through the administration compromise component. There is an
additional source of financing which consists of the direct payment of services provided
to the uninsured individuals.
CCSS provides the facilities used by the Cooperatives in exchange of a symbolic rent.
Maintenance, expansion and modifications to these facilities are the Cooperative’s
responsibility. The cooperative purchases its inputs directly from the general storehouse
or other production centers of the CCSS. Cooperatives function as private companies,
the basic salary is similar to those paid by the CCSS, but cooperatives do not recognize
seniority. If an employee does not have a good performance, he or she is fired. An eye
is kept on the financial resources in order to reduce situations such as absenteeism and
abuse from the personnel’s part. Most of the times, surplus is reinvested. Regulation is a
responsibility of the CCSS and the Ministry of Health.
Some of the results of this modality of health care services provision are: cooperatives
produce 36% more consultations than traditional clinics; consultations by non doctor
personnel are 24% larger than in the traditional clinics of the CCSS. First time
consultations increased 6% in cooperatives, while they diminished 2% in traditional
clinics (in the same period); the X-rays practiced increased 10%, while the CCSS clinics’
rate remained practically unchanged (0.3%). The total of per capita medicines delivered
by the cooperatives is 2.4 times higher than that of traditional clinics; the number of
consultations of general medicine per contracted hour in the cooperatives is 30% higher
than the average of traditional clinics; 68% of users considers low the waiting times in
the cooperatives, while the rate in traditional clinics is 55%; 62% of the interviewed users
favor the introduction of the private sector in service provision. 7 Concerning the
efficiency of the Program, collected evidence shows that 80% of the patients arriving in a
health cooperative contracted by the CCSS are received by a doctor in less than half an
hour. This contrasts with 40% in the urban clinics of the CCSS. The service coverage for
the people in the cooperatives is also larger, reaching 74% for infants less than a year

5
old (in 2002), while the coverage for the same group is of 61% in the units administered
by the CCSS.8
1.3 Basic Integral Health Care Team – Equipo Básico de Atención Integral en salud
(EBAIS). These teams include a general practitioner, ancillary personnel and a support
team (nutrition specialists, social assistants, psychologists, etc.). Each team is in charge
of a population of 5,000 inhabitants of the zone (preferably rural) for which it has been
contracted. Each team has the necessary infrastructure and equipment to provide first
level health care; it has the ability to refer the necessary cases to the second level once
they have been evaluated and/or stabilized. The package provided by these teams
includes the integral care programs for children, adolescents, women and the elderly
that are also offered in all other public health areas by the CCSS. Teams are financed
by capitation and their regulation is a responsibility of the Ministry of Health and the
CCSS.
The EBAIS have shown satisfactory results for 2002 in 7 out of 13 objectives defined
regarding coverage. They were also successful in analyzing the global situation of health
with the participation of the community. Currently, the model has been extended to all
the health areas in the country.9
2. Nicaragua. Prevision Health Model
Since 1992 the Prevision Health Model buys health care services from organized service
providers for those insured in the Nicaraguan Institute of Social Security (INSS) and their
families with funds from the contributions (of the worker, the employer and the State).
This model has permitted a larger participation of the private sector in the medical
services provision market. The INSS holds its traditional role as collector of
contributions, it transfers the health care activities to the 32 Prevision Medical
Companies - Empresas Médicas Previsionales (EMP), and keeps the functions of
regulator, facilitator and supervisor of the sanitary actions needed to assure a minimum
quality in the provision of services. The establishment of the EMP model permitted to

6
extend the coverage on a national basis to 119,269 active insured members.10 Social
security has been oriented towards financing and regulating the EMPs, to whom it buys
a basic package for its insured population. The Ministry of Health defined the basic
package considering the tenth international disease classification CIE-10 and completes
care for the insured in its units providing free care for the diseases not covered by the
package. Until now, the Prevision Health Model does not provide care for pensioners,
who are still covered by the Ministry of Health.
Some results of this model are: 60% increase in the number of employers affiliated to
the INSS in 1994, due to the popularity of the program among their employees. A
satisfaction survey carried out by the INSS in 1998 revealed a high level of satisfaction
among users (80% or more) concerning medical care, affiliation and provision.
Nevertheless, there is a latent risk of polarization in service provision capacity between
the Ministry of Health and the INSS because of the limited resources allocated to the
Ministry’s operation.
3. Guatemala. Alliance with Non Government Organizations (NGOs).
Public-private collaboration in Guatemala started in 1996 under the health sector reform
designed to extend coverage, when 46% of the population, consisting basically of highly
vulnerable and poor groups, had no access to health care. Thus, the “Health Services
Improvement Program” was created. The Program was financed by the Inter American
Development Bank and executed by the Ministry of Health with the following aims: a) to
extend health services coverage, particularly to populations with no access; b) to
increase the public expenditures level and to broaden the financing sources; c) to
reorient the allocation of public resources under equity and efficiency criteria; and d) to
generate an organized social response to mobilize and survey public resources.11
The coverage increase was made possible through the alliance with 77 NGOs in charge
of provision as well as management activities concerning basic health services.

7
Currently, there is a project of continuous improvement of coverage and health care
services quality in Guatemala.12
NGOs constitute an important ally in coverage extension for basic first level health care
services. Financing comes from public resources given to the Ministry of Public Health
and Social Assistance – Ministerio de Salud Pública y Asistencia Social (MSPAS) which
is provided in cash or as services (vaccination and treatments), and from international
cooperation funds such as the Pan American Health Organization (PAHO), the
International Development Agency (IDA), the United Nations Fund for Childhood
(UNICEF), the European Union, and the German Cooperation for Development (GTZ),
which are specially devoted to training and technical cooperation.
After three years, results show that coverage went from zero to 3.5 million people
something that had not been possible to achieve in the past 40 years. The model
included prevention and health promotion actions that opened and consolidated areas
for community participation. The services provided included a drug package, selected
according to a priority matrix based on populations needs. The information produced is
used for the better management of the different levels of care. A standard has been
created for a basic set of health care services and to achieve a better integration of the
three levels. 13
4. Colombia: Structured Pluralism
The health sector reform brought up by the 1993 Ley 100 (Law 100) meant profound
changes in the organization and functioning of the sector that incorporated the private
sector participation in insurance and health care services provision. This reform included
three different complementary proposals: the 1990 decentralization, the 1993
decentralization of competences and resources, and the organizational and financing
transformation which separated functions and established a regulated concurrence for
insurance and health services provision. The new system was based on the separation
of individual and collective services, leaving the former in the hands of a regulated

8
concurrence market and the latter in charge of the State. In the same way, the insurance
management was separated from the services provision, hoping that public and private
institutions would participate in a concurrence environment under the State’s
stewardship. The State regulates the actors on the market and surveys their behavior,
while it also subsidizes the demand of those who can demonstrate being extremely
poor.
The new system separated functions: direction was given to the National Social Security
Council, the Ministry of Health and the department and municipal level directions,
financing is done through the Solidarity and Guarantee Fund – Fondo de Solidaridad y
Garantía (FOSYGA) with four minor accounts: internal compensation of the contributory
regime, health subsidies regime solidarity, health promotion, and catastrophic risks and
traffic accidents insurance. The insurance management is done by the Health Promotion
Entities - Entidades Promotoras de Salud (EPS) and the Subsidized Regime
Administrators - Administradoras del Régimen Subsidiado (ARS). Service provision is
done through the Services Providers Institutions - Instituciones Prestadoras de Servicios
(IPS), the State Social Enterprises - Empresas Sociales del Estado (ESE) and the
Health Solidarity Enterprises - Empresas Solidarias de Salud (ESS); while supervision
and control are in the hands of the Health Superintendence.
Financing, in charge of the FOSYGA, is nourished by resources coming from the
municipalities, from revenues rendered to the nation by the departments, from resources
of ECOSALUD (taxes on games, lotteries, etc.), from voluntary contributions of
municipalities and departments, from the participation on the taxes of the new oil wells,
from the social VAT, from the tax on guns and ammunition, from the contribution of
employers and workers and from co-payments and moderating payments of the affiliated
and their families.14
The insurance management is done by the public, private, solidarity or mixed EPS,
which are responsible of the population enrollment and whose major role is risk
administration. Furthermore, they directly or indirectly organize and guarantee the

9
provision of the Obligatory Health Plan - Plan Obligatorio de Salud (POS) to the affiliated
and their beneficiaries. They also offer complementary health plans to those with the
ability to pay. In much the same way, the public, private or solidarity ARS offer the
Subsidized Obligatory Health Plan.
Provision of individual health care services is done by public and private entities that
compete for the users market in urban and rural zones, offering the possibility of free
choice and thus promoting concurrence among EPS and IPS. Public hospitals were
transformed into Social Enterprises of the State - Empresas Sociales del Estado
(autonomous and decentralized public entity).
An important amount of literature outlines the problematic aspects of the reform.
Nevertheless, it is also possible to find evidence of some if its positive aspects, such as:
first of all, the increase of the coverage of the Health Social Security General System -
Sistema General de Seguridad Social en Salud (SGSSS) has benefited people in all the
income deciles, but in a much more dramatic way in the first decile of income, which
moved from 3.1% to 43.7%. This increase can be observed starting on the extension of
insurance. During the first 5 years of the reform (1993-1997), the insurance coverage
passed from 23% to 57% of the population; 65.8% of this figure corresponds to the
contributory regime and 34.2% to the subsidized regime.15 Second, the creation of the
Subsidized Regime (SR), which shifted supply-side subsidies to demand-side subsidies.
This means a modification in the way subsidies drive the delivery of health care. Instead
of giving resources to the institutions that provide services, subsidies are “handed” to the
population by assuring the provision of a certain quantity of annually standardized
services. Third, access to essential drugs is improved and a better system of supervision
of public health is developed due to the creation of a unified information and public
health supervision system.16 Fourth, advances are made towards capitation payment
based on health care levels by contracting public or private IPS. This generates several
favorable economical impacts on the resources managed by the insurer as well as by
the provider. The objective of the health care provision model built in Colombia with the
EPSs and the IPSs is not only to achieve better levels of efficiency in the management

10
of available resources for health care, but also to develop a prevention culture. The
insurer is no longer alone in trying to control risks by promoting health and disease
prevention. After the reform, the provider also shares the risk of disease. Fifth, the
“National Survey of Users’ Health Quality Perception” in 2000 showed that 85% of the
population received health care on time and 83% considered it as good.17 Furthermore,
social participation mechanisms such as citizens supervision and users associations are
created by the health companies and institutions.
2. Mexican health system
2.1 Composition
The Mexican Health System is a mixed segmented model consisting of public and social
security services as well as private services that covers groups of population according
to the labor position and the ability to pay of individuals. The system is structured in the
following way:
1) Social security; formal economy workers are forced by law to affiliate to a social
security institution. There are several types of social security institutions: workers in the
formal sector of the economy are covered by the Mexican Institute of Social Security
(IMSS); those working for the State are covered by the Institute of Social Security and
Services for State Workers (ISSSTE); while the Mexican Oil Company (PEMEX), the
army (SEDENA) and the Ministry of Navy have their own systems. In 2000 social
security institutions covered about 50 million people. IMSS concentrated the largest part
of the insured (almost 80%), followed by ISSSTE, PEMEX, SEDENA and the Marine
Ministry, as well as some other government employees. 18,19,20
2) Public Assistance covers the uninsured population (about 48 million people). It
includes the decentralized structure of the Ministry of Health –Secretaría de Salud
(SSA), which operates in the urban and rural zones throughout the country, and the
IMSS-Solidaridad Program that provides care to the population in defined rural zones

11
(about 11 million people in 14 states). 21 It also includes other services covering specific
population groups such as the National Indians Institute – Instituto Nacional Indigenista
(INI), and the Integral Family Development – Desarrollo Integral de la Familia (DIF), in
charge of rehabilitation activities.
3) The private sector, highly fragmented, counts a large variety of institutions that can be
divided in for profit and not for profit. The former provide a large range of health care
services for the population with the ability to pay and are mostly financed on the fee-for-
service scheme. Among the pre-paid schemes, the private health insurance is the most
important. It covers some public and private companies’ employees as well as families
and individuals who buy these services directly. An estimated 2% of the population is
under this type of insurance coverage.22,23,24 The not for profit, non governmental
organizations (NGOs) are very varied and have an important presence in the areas of
sexuality and reproduction, HIV/AIDS, intra-familiar violence, addictions healthcare and
the disabled. NGOs work through organized networks, generally offering their services
for the uninsured.25,26 Some studies carried out in Mexico show that the private sector
represents one third of the ambulatory services offer of the national health system.
Proportionally, one third of the country’s population usually relies on private
medicine.27,28
2.2 Health Expenditure and Financing
Health expenditures as a percentage of GDP in Mexico reached its maximum level in
2002, with 5.8%.29 This figure includes public expenditure including services provided by
the SSA and the social security institutions; which represent 46% of the total health
expenditure. Private pre-payment is only 2%, while out of pocket spending is calculated
in 52%. Compared with other countries in the same region, the latter is very high and
unequal, in part because 50% of the population has no health insurance. This inequality
forces a great number of families to undertake catastrophic spending in health care, that
is, to spend 30% or a greater part of their available income. It is in the lower deciles of

12
income that we find the largest proportion of families facing this kind of
shortcomings.30,31
There are three major health care services financing mechanisms: 1) State revenues.
The SSA is financed, basically, by the Federal and States Budget, through general and
specific taxes. It also has its own revenues from fees-for-service from the population
with the ability to pay. IMSS–Solidaridad receives an allocation of the federal
government and counts with the managerial assistance of the IMSS; 2) Contributions to
the social security, collected through workers and employers contributions, which are a
payroll taxes, state and federal taxes and other contributions (see Table 1). It is
important to note that the proportion of the covered population changes according to the
volume of the formal labor market.32 Finally, private payments include the payment of
private insurance premiums and out-of-pocket direct payments at the point of provision.
Generally speaking, private insurance constitutes a commodity available only to a
reduced group, mostly urban, with the ability to pay and with no pre-existing diseases.
Most of the times, direct payments are done in the location where care is provided and
each consumer decides upon how much he/she wants to or may consume according to
his/her income.33 The effort families have to make to finance the health care services
and drugs they might need at each moment is thus made clear.
Table 1. Social Security Financing.
Characteristics
IMSS ISSSTE PEMEX SEDENA States
Juridical
Nature Threefold
Organism
(government,
companies and
workers)
Public Institution
with juridical
personality and its
own patrimony
Public Company
with juridical
personality and its
own patrimony
State
Ministry Public
Institutions in
various states
Financing
Sources Federal,
employee and
employer
Federal and
employee Its own Federal Federal/State
and employee
The distribution of funds has changed in the last years. The largest percentage of
national health expenditure according to its source (origin of funds) corresponds to
Source: PAHO, 2002

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households, and it passed from 50% in 1993 to 57.5% in 1998. Following is the
contribution of the federal government, which increased from 19.4% to 23.8%. While the
contribution of employers diminished after the reform of the social security law in 1997; it
was 29.1% in 1993 and decreased to 18.4% in 1998. Since 1997, the social security
funds diminished, as retirement and health funds were separated, following the above
mentioned reform. In 1998, the largest proportion of funds corresponded to the private
sector, 53.9%.34
2.3 Private health expenditure
Several studies carried out in Mexico show that private health expenditures increased
steadily during recent years. Health financing based on out-of-pocket spending is one of
the most regressive. It is based on an unfair distribution of resources that generates
inefficiency, financial losses for the system and impoverishment risks for the
households. Evidence from the SSA35 reveals that, in 2002, 58% of health expenditures
came from out-of-pocket spending. It was in the last quarter of the same year that 3.9%
of Mexican households incurred in catastrophic health spendingi. This is why out-of-
pocket spending is considered as one of the most inefficient and unfair financing
methods for a health system. 36,37,38
Generally speaking, households make out-of-pocket health spending equivalent to 3.8%
of their revenue on private health care services and medicines purchase.39 Spending is
mostly dedicated to consultations and drugs and a lower proportion is dedicated to
hospitalization, dental care, the acquisition of prosthesis and rehabilitation. 40
The proportion of spending dedicated to drugs is around 30%. Hospital care accounts
for 25%, with a progressive tendency (less than 10%). In 1996 household spending in
dental care was only 11% of total health expenditure. This spending also increased.
Besides, the private institutions received approximately 41% of the total health
i This means spending that represented 30% or more of the household’s spending after food and housing
expenditures.

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expenditures. The economical crisis of those years provoked an important increase of
this proportion, which attained 57% of total health expenditure, when compared with
public expenditure.41
2.4 Service provision and health resources
Each public and social security institution provides services for its target population in its
own health facilities network in the three levels of care. 42
Individual health care in these institutions is structured by levels of care and it is neither
possible to choose the provider nor the doctor. The IMSS made a pilot test in 1999 and
2000 allowing the election of a family doctor, but it has not been continued. Promotion,
prevention and ambulatory care actions are held in the first level with the participation of
general or family practitioners and nursing personnel assisted by community health
promoters. In 1996, the SSA designed a Basic Health Service Package that was
provided through the coverage extension programs. This package included 13 low cost
and high impact interventions (See Table 2). The second level provides health care for
the basic specialties in hospitals that include ambulatory care, hospital care and
diagnose support in images and laboratory tests. The third level includes complex health
care units where specialist doctors and nurses as well as other professionals provide the
most complex health care and carry out clinical and fundamental research. These units
receive patients referred by the other levels of care and by the emergency services at
national, regional and state levels. The SSA counts eleven specialty institutes
(Cardiology, Pediatrics, Perinatology, Nutrition, Psychiatry, Oncology, Respiratory
Diseases, Orthopedics, Rehabilitation, Human Communication and Public Health). The
Social Security has its own hospitals network where the insured population uses a great
amount of hospital care services proportionally larger than the uninsured population. In
2000, the largest amount of services was provided by the IMSS, followed by the SSA,
ISSSTE, IMSS-Solidaridad, PEMEX and SEDENA. 43

15
Table No. 2. Basic Health Care Services provided by the SSA.
Private health care provision includes multiple atomized providers with a diversity of
heterogeneous capacities and service quality levels: doctors’ offices, laboratories,
hospitals, clinics, doctors, etc. Each organism or individual provider acts like an
independent company so that they don’t constitute an articulated service network. This
modality of provision is frequently accessed by individuals with the ability to pay and by
those who are not satisfied with the State’s or the Social Security’s organisms. 44,45
Private services payment may be done directly by the user or through private insurance
schemes that are bought either directly by individuals, in groups or by the users’
employers. Published data show that the private insurance market in Mexico is small
and finances only major, high-cost health interventions. Pre-payment services are not
very developed and there are but a few benefit packages offering this alternative. Their
financing is also a function of the users’ ability to pay. 46
The private services provision modality (for or not for profit) includes several sub-
modalities that are not integrated regarding the type of users, service schemes,
resources, origin or forms of financing. Overlapping of coverage occurs since there is no
technical criteria nor shared procedures related to health care. Besides, these providers
Basic Health Care Services
Health Ministry 1996
1.
Basic drainage
2.
Family planning
3.
Pre-birth, birth, and post-birth care for the mother and the child
4.
Child’s growth and nutrition supervision
5.
Immunization
6.
Diarrhea control
7.
Anti-parasite treatments
8.
Respiratory diseases care
9.
Tuberculosis prevention and control
10.
Hypertension and diabetes mellitus prevention and control
11.
Accident prevention and first aid in injuries
12.
Social participation
13.
Cervix-uterine cancer prevention and control
.

16
do not share a referral system. Nevertheless, NGOs do have certain support, dialogue
and coordination links with the official health organisms, especially in relation to public
health campaigns against disasters. 47
Even though the structure, functioning, participation, scope and limitations of the private
sector are quite unknown, it certainly provides all sorts of health care services, from
ambulatory care up to third level hospitalization. Data from the National Health Surveys
– Encuestas Nacionales de Salud (ENSA), show that this sector represents a third of the
ambulatory health services offer of the national health system and, coincidently, a third
of the population regularly relies on private medicine48. The ENSA 2000, points out that
private medicine provided services to 27% of the Mexican population even though 35%
of them were beneficiaries of an institution. Data from the Mexico’s 2000 Health
Services Satisfaction Enquiry, also shows that 32% of the population above 18 years old
used private services during the previous year49. Comparing expenditures composition
with the health care units preferred by the population, other findings point out that 26.5%
of the interviewed people report attending private clinics or hospitals for which they pay,
and another 1.2% attend the same kind of units but payment is made by their
employer.50 All this confirms the growing importance of the private sector in Mexico’s
health system.
Regarding the sector’s resources, there were 2,816 medical units registered in 1995,
with 79% having less than 15 beds. In 1999, 2,950 units were counted, but 84% had
less than 15 beds. Obviously, it is a highly fragmented sector51,52,53 with low technical
capacity. This makes regulation very difficult because of its atomization, geographical
dispersion and volume of provided services.
In private facilities, 58,724 people work as medical personnel of different categories, out
of which 86% are specialists MDs. Less than half of the medical staff (43%) has a
contract relationship with the medical unit, but this figure varies for general practitioners
and specialists. The former have this kind of relationship in two thirds of the cases, while
only 38% of the latter have a contractual link.54 In 1995 there were 27,461 nurses

17
registered in the private sector, 14% of the total nurses in the health system. Nurses’
employment increased 6% in 1999. 55
Regarding the provision of health services, almost a fourth of hospitalizations are made
in the private sector (25%), particularly pregnancy care, birth and its complications.
General surgery occupies the second place. This sector accounts for 33% of the
ambulatory care provided in the country. The private sector is the third provider of birth
care on a national level and the second one in the Federal District (Mexico City and
suburbs).
In general, there is scarce coordination between the health care private institutions and
public institutions. They tend to remain atomized and rarely represent an organized and
complementary response.
2.5 Health services purchasing
Two phenomena are present in the Mexican health system: external services purchasing
(subrogacion in Spanish) and fee reversion (opting-out).
Purchasing is frequently used by the social security (IMSS, ISSSTE, among others) to
subcontract certain services to private and public institutions that they cannot provide
with their own. Fee reversion is the devolution of part of the fees paid by employers to
affiliate employees in the social security institutions (IMSS, ISSSTE) so that they can
buy services from the private sector.
An important debate is being held in Mexico to decide whether external purchasing and
fee reversion represent or not modalities of privatization. It is not the purpose of this
paper to go further into this discussion. We shall consider these modalities as an
example of an articulated form of collaboration between the social security and the
private sector.

18
There is few published evidence in Mexico about external purchasing and fee reversion
experiences. Nevertheless, legal and juridical frameworks of the IMSS and ISSSTE do
consider them. .56,57
One of the most known examples is the original IMSS Law (1943), which states the
obligation of IMSS to directly or indirectly provide the insured population with health
services. Services are provided directly, through its own resources, facilities and
personnel, and indirectly through external purchasing and fee reversion58. Since its
inception in 1943, the IMSS has been able to concentrate resources and contract its
personnel. In 1944, when the health care provision started, there were opinions in favor
and against this. Agreements with private providers of health care for the workers were
announced in the same year. External purchasing was the dominant form of provision
for a short time, while the IMSS strengthened its capacity to provide services in its own
facilities. The first response of doctors was favorable, but the IMSS changed its policy
from purchasing services to buying private medical units. Doctors dubbed this as the
socialization of medicine. During this period, one of the major interests of doctors was to
keep technical control over decisions at IMSS, so the purchase of medical services was
considered good for them. When the policy changed to buying the medical units,
professionals demanded the institution to comply with the initial policy of purchasing
private services. 59
According to current legislation, purchasing is done through contracts established with
other organisms, public or private, in charge of providing the health services defined by
the Maternity and Disease Insurance. A second modality applies to institutions and
employers who provide medical and hospital services to their workers and who can be
entitled to fees reversion, according to what has been established by law.
Purchasing has been present at IMSS for 55 years. In recent times, it has not been used
as an innovation of the recent reform, nor as a privatization mechanism, but as a way to
guarantee access to the health care services for the insured throughout the whole
nation. The concept of purchasing has changed. First, it was used because IMSS could

19
not provide services, later it was used to assure provision in areas where resources
investment was not convenient and, today, as the IMSS cannot continue to grow, it is
once again considered as an alternative to guarantee the provision of health services for
all the insured population.
In present times, IMSS very seldom subrogates services in all the states of the country,
especially where it does not have enough facilities but the private sector does. The
purchasing contract is established to provide health services for the insured population
and the IMSS establishes the fee that the private provider will be paid.
Recently, these kind of agreements have been discretionally established with no clear
regulation defining under what circumstances, when, how, at what prices, and for whom
should the indirect social security services be provided. It is highly important to regulate
the purchasing of services60.
In conclusion, service purchasing and fee reversion are alternatives that contribute to
expand the health care capacity and coverage. They represent a real and evident
incentive to enhance quality through contracting.
3. Public-Private Collaboration Cases in Mexico
3.1 State of Jalisco
Health care has passed through a series of changes in the western state of Jalisco. It
has evolved as a result of the changes brought up by social, political and economical
conditions of the country and the region. Following the system reform of the 80s, four
facts have marked the recent history of the Ministry of Health of the state: 1) In 1984 the
Coordination Agreements for the Decentralization of Medical Care and Sanitary
Regulation, Control and Promotion were established, and the Health Department of the
State was created and started operations. In August of the same year the State Official
Report (Diario Oficial) announced the decentralization of roles towards the Coordinated

20
Public Health Services in the Federal Entities, giving them operational autonomy. 2) In
February 1986, the Coordination Agreements for the Organic Integration and the
Operational Decentralization of Health Services of the State are passed. 3) In 1996, the
SSA and the state government subscribed the national coordination agreement for the
integral decentralization of the health services in the state. The agreement aimed at
establishing the basis, commitments and responsibilities of each part in the organization
and decentralization of the health services in the state. It also regulates the human,
material and financial resources transference in order to allow the state of Jalisco’s,
autonomy to exercise the roles defined by the General Health Law. 4) The state created
two Decentralized Public Entities (OPD). One is called OPD Health Services of Jalisco
and the other OPD Civil Hospital of Guadalajara. These entities are responsible to
assume functions transferred by the federation and those defined by the legal
instruments that created them. They have juridical personality and their own patrimony,
service and authority attributions. Finally, in 1999, the Guidelines of the Law of Creation
of OPD Health Services Jalisco, was published.
As a consequence of decentralization, new attributions were conferred to the Ministry of
Health of Jalisco. The Ministry should now promote and asses all actions and programs
of the private and charity institutions, and support them in their relations with the various
state authorities in order to facilitate their development and improve the community’s
participation in health care provision.
By the late 90s, the Ministry of Health of Jalisco designed and developed new strategies
of health care provision incorporating the private sector in order to improve efficiency
and the use of resources, while expanding the access and coverage of the population
that was not covered by social security. This gave birth to public-private collaboration
(public financing with the inclusion of private providers). Three events marked this
experience.
3.1.1 Due to the fact that new posts for doctors could not be created while demand was
growing and population became more demanding of health care, the establishment of

21
agreements with private doctors started in 1997. Later, in 1999, as a part of the
innovations of the health care system of Jalisco trying to expand coverage, contracts
with basic teams including a doctor, a nurse and a health promoter were established.
These teams are contracted by the OPD Jalisco Health Services under a scheme of
independent professionals. Care is provided at the doctors’ facilities or those of the
municipality when they reach the necessary agreement. The physical place for
consultations is to be provided by the Family Integral Development (DIF) program or by
the community. The doctor and the nurse receive basic honoraries payment equivalent
to half of the salary of a payroll employee of the same category in the SSA. Incentives to
productivity and goals’ accomplishment are added to this payment. Usually doctors are
general practitioners, young and, in most cases, are part of the community, as well as
the nurse and the health promoter. Criteria to contract this type of care include: the non
existence of SSA infrastructure in the community or that the nearest facilities are more
than an hour away using public transportation; that the community is rural and its
population larger than 2,500 inhabitants. The services provided under this modality of
agreement are first level health care, general consultation, health promotion and
protection activities and disease prevention, clinical files, vaginal cytology, treatment,
conferences, and home visits, among others. When the users need a higher level of
health care, the doctor refers them to the hospitals of the Ministry or to contracted
private hospitals. Data from Jalisco indicate that the contracted personnel is satisfied.
They have a job that permits flexible working schedules, may look over their home
affairs since they work inside their communities and have a chance to improve their
income through productivity incentives. Users also report being satisfied with the
services. Although they still complain about not receiving drugs on time.
Scheme 1. Public Financing – Private Service Provision with Basic Team
OPD Jalisco Health Services
Purchase
Basic Team
Doctor
Nurse
Health Promoter
Medical consultation, health promotion and disease prevention activities
Public Financing
Private service provision
Users

22
3.1.2 The second experience was contracting with first and second level hospitals. This
experience originated in 1999 responding to the pressure of the presidents of
municipalities who wanted to create hospitals in every municipality. Since it was
technically and financially impossible to do that, the presence of a private sector
possessing the necessary infrastructure and human resources to guarantee health care
was considered as a potential solution. Thus, the SSA designed a program to contract
services with private hospitals in the municipalities where the SSA had no infrastructure.
Since it is sometimes cheaper to contract with the public sector than to build and
maintain new hospitals, the objective of contracting hospitals was to guarantee coverage
of hospital services and to enhance efficiency in the distribution of resources. The
experience begun with one hospital, but by the beginning of 2003, there were already
fourteen contracted hospitals. Currently, only eight contracts are maintained. Cutting
contracts by several hospitals was due to the lack of guarantees for on time payment of
provided services. One hospital was separated from the program because it did not
meet the sanitary requirements of the SSA. The criteria for establishing this kind of
contracts include: a) municipalities must have more than 50,000 inhabitants, b) they
should not be contiguous to other municipalities having SSA hospitals, and c) the type of
services to be contracted is chosen according to the private provider’s resolution
capabilities. It is the uninsured population that can use this type of services after referral
by the health center through the patients’ referral and counter-referral system. The
provided services are of the first and second levels and correspond particularly to
emergencies in the basic specialties areas: internal medicine, gynecology and
obstetrics, pediatrics and general surgery. They also include X-rays, clinical laboratories
and drugs. Hospitalization should not be longer than two days so, as soon as the patient
is stabilized, he or she must be referred to one of the Ministry’s units to continue the
treatment. Service purchase is done through a contract specifying, among other things,
what kind of services are provided, how should patients be treated, a guarantee of the
quality of services, the amount to be paid and the payment modalities. Contracting is
done by the OPD Jalisco Health Services and payment is defined by hospital day and
specialty, while other services have prices that have been pre-established by the

23
Ministry of Health. The population of the Popular Insurance Programii does not have to
pay anything out of pocket, while the uninsured have to pay a recovering fee to the
SSAiii , but not to the private provider. Although this strategy has worked quite well, it
has encountered several shortcomings, among them: delay in the payment of services
by the SSA; in some regions, the low tariffs paid by the Ministry of Health for
procedures; the low demand of the population due to the lack of confidence in the quality
of the free character of services; and the opposition of some SSA functionaries.
3.1.3. A third experience is that of contracting with private pharmacies. The multiple
problems in the purchase and distribution of medicines and in the management of
pharmacies in the SSA forced the decision to contract with the private sector. Even
though some problems still exist, the drugs supply was improved. Patients go to the
drugstore with a prescription, sign it, receive the medicines, and the SSA pays the
private drugstore. This kind of purchasing from the private sector is a little bit more
expensive than the consolidated purchasing systemiv, but the Ministry of Health argues
that if fixed costs (infrastructure and other operation resources in the public sector
ii Insurance program for poor populations not covered by any type of social insurance, operating in 21
states of the Republic.
iii A fee paid by the user in the moment of receiving the service according to his o her income.
iv Consolidated (or group) purchasing is done by various public institutions to increase bargaining power against
pharmaceutical and distribution companies
Scheme 2.
Public Financing - Private Provision at 1st and 2nd level of care
OPD Jalisco Health Services
Purchase
Hospitals
H. I Ievel of care
H. II level of care
Public Financing
Private Service Provision
Users
Patients referral and counter-referral system

24
pharmacies) were to be considered, the average cost would be higher than what is paid
to the private sector.
The legal and normative context for this program’s functioning is given by the decree
number 16526 regulating the Law of the Public Decentralized Entity “Jalisco Health
Services”.
2. The case of the Medical Specialties Center in Jalapa, Veracruz
Antecedents and objectives:
The Medical Specialties Center of Veracruz (CEMEV) is a third level public hospital
financed with funds coming from the state budget. The CEMEV was created in 1989
and, since its inception, it includes a service modality for the care of private patients. The
CEMEV is regulated by the Law number 54 of the state, and it functions under the
precepts of a Decentralized Public Entity (OPD)v, which’s major characteristic is to have
juridical personality and its own patrimony.
According to its ordinance, the major objective of this mixed model of care is to
subsidize the most economically unprotected population using the payments made by
the population received in the private area. It is worth mentioning that 40% of the
patients at the CEMEV are treated in the private area while the other 60% are part of the
non-insured population without capacity to afford private services. Furthermore, 67% of
the users treated in the public area pay an average of 15% of the cost of care as part of
a recovering fee. The Hospital doesn’t charge anything for care to those users classified
by the routine socio-economical survey as living in extreme poverty.
v This Law creates the figure of the Health Services Public Decentralized Organism of Veracruz -
Organismo Público Descentralizado de Servicios de Salud de Veracruz (Ley 54)

25
Installed capacity and financing
The infrastructure of the CEMEV is equivalent or superior to that of other private
hospitals in the state. It also has very well equipped laboratories and lower costs. The
high technology equipment such as artificial breathing machines, blood dialysis and cat
scanning machines, operate 24 hours a day. The CEMEV has 214 beds, 24 in the
private area and the rest in the public area.
The most important financing source of the CEMEV comes from the state government’s
funds and it is exclusively used for the payroll (Cap. 1000). This amount represents
about 70% of the total expenditures of the CEMEV. The other 30% of the resources
come from the payment of services and “recovering fees” by the users in both areas, as
well as revenues from several agreements signed by the Hospital with private and public
institutions. (See Scheme 1)
The ISSSTE, PEMEX, the University of Veracruz (UV), and private insurers are among
the institutions having signed agreements with the CEMEV.
Payment of services in the public area is defined according to the income level of each
user. The patients in the private section constitute the highest category concerning
economical income and their payment includes the hotel services. On the other hand,
patients in the public or assistance area represent the part of uninsured population with
the lowest income level and their recovery fee is calculated considering the cost of the
medical service without the hotel service. Generally, costs of care in the private area are
estimated considering a survey of the local hospital services market and CEMEV’s tariffs
are kept about 10% under the prices of other hospitals in the zone.

26
Services Provision
Public area. This area, also called “assistance”, operates in the same way as other
public hospitals providing care for uninsured population. This population always goes
through a socio-economical assessment designed to define the tariff for the
corresponding health service according to the ability to pay. Users in this section are
generally referred by another public health institution or by the company or institution
where they work, when an agreement has been signed between these and the CEMEV.
These patients are exempted of paying fees. Nevertheless it is possible for a patient to
come directly (with no referral) in search of hospital and/or ambulatory care. It must be
noted that patients admitted in the Center through the emergency area receive care
without considering if they are affiliated or not to the social security.
The waiting lobby in the building’s ground floor is the first point of contact with the
hospital personnel. Usually, patients wait for about one hour before they are received for
consultation. Depending on the type of services they demand, users may have to wait
an average of one month before they are given a first appointment. Bed occupation is
generally very high due to services demand.
Scheme 3. CEMEV Financing Sources.
Agreements: PEMEX, ISSSTE,
UV, insurers State Government Payrolll
Financing
Users payment
Hotel Services
Private payments
Laboratory,
images Recovering Fees

27
The personnel working in this area has a permanent contract with CEMEV, with an eight
hour working day on the morning shift, and various other fringe benefits defined by law.
Doctors are mostly young, specialized in various clinical areas and started their working
experience when CEMEV started operations. This group of doctors were initially trained
at the state’s university and most of them have been certified by the corresponding
specialty council vi.
Private area. At first, the private area had 16 rooms in the third floor of the building, but
due to the increasing demand, 8 more rooms were adapted in the second floor, making
a total of 24 rooms.vii Each room in the third floor has a waiting area, a TV set, and a
bathroom. The tariffs per day go from $400.00 to $650.00 MxP depending on the rooms’
dimensions. The rooms in the second floor have less hotel services and standard tariffs
are of $300.00 MxP. The average stay is 2.3 days and 80% of the demand in the private
area is related to surgery (gall bladder, hernias, c-sections). The other 20% are patients
looking for different services. The demand for hospital beds in this area is very high and
average occupation is 97%. Patients can be referred to the private area of the hospital
by their private doctor who does not have to have any kind of agreement with the
CEMEV to refer his/her patients, nor needs to fill in any kind of formal requisite such as
specialty or recent certification. The patient is admitted just with an informal notification
from the private doctor. Patients pay to CEMEV for nursing care and hotel services, but
medical honoraries are paid directly to the doctor. If care includes a surgery, for
example, honoraries are also paid to CEMEV’s medical personnel. Nursing personnel is
paid by CEMEV. Waiting times are very short in the private area and the first admission
requisite is a $4,000.00 MxP deposit made by the patient. If the total cost of care
services is lower than that, the remaining sum is returned to the patient when he/she
leaves the hospital.
vi Certifying councils are doctors associations authorized by the law to verify the competence of their
associates through periodical assessments. Possessing a certificate recognizes the doctor’s competence
and consolidates prestige.
vii There is a plan to increase the number of beds by enlarging the physical area of the private section in
2004. A grant of the state’s government will be used for this.

28
Types of services users
There are three kinds of services users: a) users admitted through the public area and
receiving care in the same area; b) users admitted through the private area and
receiving care in the same area; and c) users admitted through the public area and
receiving care in the private area. There are certain subcategories for b) and c) types
that must be noted.
As it has been mentioned, the type b) users may look for care under the coverage of
agreements signed by CEMEV with several institutions (in which case the cost of care is
covered by the concerned institution). They can also come referred by their private
doctor. Type c) user’s characteristic is that they receive care in both areas. This
category is admitted through the public area and, based on a personal decision,
generally following a public area specialist’s suggestion, can be transferred to the private
area. This doctor continues in charge of the transferred patient’s care. In order to assess
the patient’s ability to pay, the CEMEV makes a socio-economic study before
transferring the patient. This kind of patients pays all the services to the hospital,
including medical honoraries.
Scheme 4.
Service Provision
Population
Demand
Public Area
Private Area
Hospital
Doctor
Hospital Nurse
Hospital Doctor
/ Private Doctor
Private
Doctor
Public /
Public
Users
Public /
Private
Users
Private /
Private
Users

29
3. Federal District. General Hospital of Mexico.
General Hospital of Mexico (HGM) is a public institution more than a century old. Its
creation project was conceived in 1895 and became real in 1900 with an installed
capacity of 800 beds providing services in general medicine, surgery, venereal diseases,
maternity and child diseases, infectious-contagious diseases and birth care. For some
time it operated as a charity institution dependent of the Ministry of State and
Governance, providing free care for poor patients regardless of age, sex, race,
nationality nor religious creed. In 1952, based on a decree published in the Federation
Official Report, the Technical Management Council of the Hospital was created as
dependent of the Ministry of Health and Assistance in order to provide increase
autonomy to the hospital’s internal administration. In 1986, the HGM was transformed
into an administrative decentralized entity, subordinated to the Ministry of Health. This
gave the Hospital operational autonomy, with the attribution of several functions
permitting a broader institutional presence for health care services provision to the non-
insured population. To consolidate the National Health System, the HGM is declared as
a decentralized organism of the Federal Government in 1995. This gave the hospital
juridical personality and its own patrimony, permitting it to offer high specialty medical
services and fostering all the studies, programs, projects and researches implicit in its
area of competence (Secretaría de Salud, 2004).
The HGM provides health care services particularly in the area of high medical specialty,
the design and execution of programs and training courses, teaching and specialization
of the professional, technical and ancillary personnel. It is also in charge of clinical and
experimental study as well as research concerning the specialties present at the
Hospital. The HGM has an area of responsibility and counseling to social and private
institutions that functions as a consulting organism for the dependencies and entities of
the Federal Public Administration. It is also in charge of the technical and scientific
information concerning progress in the health field and publishes the results of all its
research and work.

30
Nowadays, the HGM’s installed capacity is of 1,008 beds, 48 surgical rooms (2 of which
are not functional), 3 delivery rooms, and another one for labor, 8 intensive therapy
rooms, 2 admission rooms, 38 recovery rooms, 150 consulting offices, 37 waiting rooms,
27 X-rays rooms, 45 laboratory rooms, 1 ultrasound room, 7 language therapy offices, 1
of pathological anatomy, 2 auditoriums and 48 classrooms.
Regarding human resources, the hospital counts 6,012 functionaries (100%), including
724 doctors (12.04%), 1,627 nurses (27.06%), 1,339 paramedics and similar (22.27%),
189 medical confidence personnel (3.14%), 18 researchers (0.30%), 287 residents
(7.47%), 417 people engaged in general services (6.94%), 68 technicians (1.23%) and
68 people working in the administration (1.13%).
The HGM offers specialized medical care to millions of Mexicans, particularly low
income people who are not affiliated to social security nor have access to private
medicine. Patients come mostly from the Federal District (48%), the State of Mexico and
other states of the Republic.
About four years ago, the hospital’s general direction decided to establish agreements
with health institutions of both public and private sectors. These agreements aimed at
obtaining resources through the sale of services to IMSS, PEMEX, Ministry of Navy,
Clínica Londres and the Mexican Association against Breast Cancer (CIMA). The
resources thus generated would be dedicated to the provision of services in the public
area.
The provision coverage for the above mentioned institutions includes services of
resonancia magnética, audiología and foniatría, oncology and mastografía. Care in
these areas is provided by doctors located in the hospital’s payroll who voluntarily
decide to enlarge their working day to the afternoon shift, receiving an economical
compensation to be added to their nominal salary.

31
The agreement with CIMA includes the referral of patients that receive free care at the
mastografía area. In exchange, CIMA is paying for the works of expansion of this area.
In the audiología specialty, it is the population with the highest level of income that
demands implantes cocleares. In this case, they have to pay the services according to
the highest tariff (recovery fee), which is $27,000.00 USD. Besides, they have to pay the
device, which, in Mexico, costs about 23 thousand USD.
There is no system for the estimation of the cost of production of care. Tariffs charged
are estimated according to market prices and the recovery fee varies according to socio-
economic category. This may imply some sort of subsidy of private patients with public
funds. Considering that the cost of the same procedure in the United States is estimated
in $40,000 USD (not including the device), it is possible to get an idea of the difference
of costs of this surgical operation in the HGM.
Private users can arrive directly, without any kind of referral by an institution having
signed an agreement with the HGM. In both cases demanders of care services are
catalogued as private population.
People with a lower economical level may pay different tariffs, from $430 to $1,900 USD.
But, as one of the administrators of the hospital recognizes, lower tariffs are rarely
applied because they mean severe economical losses for the institution.
Since the transplant demand is very high, there is a selection process applying a Special
Referral Pattern to Facilitate Indication of Implantes Cocleares (IC Profile), which does
not include any kind of socio-economical criteria but considers the medical,
audiológicos, otológicos and psycho-pedagogical antecedents.
Between 2000 an 2003, five hundred implants have been made in Mexico, out of which
120 were made at the HGM.

32
4. Final remarks
Public-private mix is an issue that has been present in the organization of health
systems in Latin America for many years but is by no means a dominant form of
organization. Today different countries are adapting public-private mix to the specificities
of their health services structure. As the paper shows, while Costa Rica is using its
social security funds to contract private providers in underserved areas, Guatemala is
contracting NGOs with a strong and longstanding presence on the ground, to serve to
those populations that have been consuming services for many years on a fee-for-
service modality. Therefore, public-private collaboration may be a promising strategy to
increase health care coverage and to reduce the financial burden to populations that pay
out-of-pocket services.
In Mexico a modality of private contracting by social security funds has been present
since the inception of the Mexican Institute of Social Security in 1943. In those years
contracting was seen as a strategy to cope with the lack of resources of a growing
structure. This structure became quite strong in the following years and it was able to
provide most services using its own infrastructure. The crisis of social security
institutions in Mexico and in other Latin American countries have confronted decision-
makers with a new reality that will make them to look for new options to increase the
capacity of institutions to respond to populations’ health needs. Opening structures to
collaborate with the private sector is being considered by many countries.
So far, in Mexico, public-private mix is already present in other areas apart from social
security institutions. In fact, in the three cases described in this paper a public
assistance institution is involved. The shrinking budget environment that public
institutions have been facing in the last 10 years is pushing them to contract with the
private sector aiming at being able to expand services to underserved populations
and/or to create an extra funding mechanism.
Public-private mix is a very sensitive topic in Mexico because of several political actors,
it implies the possibility of privatizing areas of the system for the benefit of the private

33
industry. Nonetheless, as the experience of regional countries show, the public-private
collaboration can offer benefits for all parties once the legal frame of collaboration is set
up.
The responsibility to regulate the interaction between the public and the private sectors
both at the financing and the provision end is in the hands of the Ministry of Health at the
federal and state levels. The complexity of a segmented health system such as the
Mexican one entails the need of solid regulatory mechanisms that could induce actors to
behave according to rules without reaching the point of asphyxiating the interaction.
Lots of research is still pending to be done in the future in order to map and understand
the benefits and the risks of all the models of public-private collaboration in Mexico. The
conditions to move towards that way are given and institutions are already rehearsing
modalities of collaboration that need to be assessed to constitute a adequate regulatory
mechanisms in order to make sure that the health needs of the Mexican population are
covered and that the system is giving opportunities to all interested parties.
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