Making the Market Work for Brazilian Health Plan Consumers / by Mark Langevin

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            Brazil’s federal agency (Agência Nacional de Saúde Suplementaror ANS) that regulates the private sector market for health insurance plans announced this month that it would suspend the commercial operations of 288 plans offered by 38 companies operating in the Brazil.  As of July 13, 2012 these plans cannot be sold until the next round of evaluations.  In some cases, plans can be fined by the ANS for up to R$ 100,000. For those consumers stuck with these plans, chances are that in many cases services will improve as a precondition for the plan to re-enter the commercial market. In addition, ANS approved plan premium adjustments of 5%.
Brazil’s private sector marketplace is substantial, and overlaps with the government’s health care system in significant ways.  In 2007 Brazil’s public sector SUS only accounted for 29.8% of all healthcare spending while the country’s private sector accounted for over 57%.[1]  However, as Andrade, et.al. (2010) report, private health insurance plans cover approximately 25% of the population, divided between employer provided and individual contract plans. Private sector participation in SUS administered services ranges from offering 75% of the hospital beds, 83% of clinics, and 40% of the country’s diagnostic and therapeutic specialty centers.[2]
According to Zarrilli, the private sector includes health maintenance organizations (HMOs), health cooperatives such as Unimed (the largest in Brazil), employer managed systems (autogestão) which provide health care to the employees of large firms; and plan administrators, which are health systems directly and jointly managed by large firms and health insurance providers.[3]  Table five reports the number of enrolled private sector plan beneficiaries per year from 2003 to 2011 and reveals steady annual increases. Just in the past nine years the number of beneficiaries has increased by nearly 15 million subscribers, an average annual increase of 1.66 million Brazilians.  Table five also reports the estimated coverage of private plans as a proportion of the total Brazilian population. From 2003 to 2011, private plan coverage increased from 18 to 24.4 percent of the population.  Continued increases in the relative coverage of Brazilians are largely dependent upon continued economic growth and income redistribution policies (see Appendix 1) short of a major policy reform of the health sector.
Table 5 : Number of Health Insurance Plan Beneficiaries and Private Plan Coverage as Percent of Total Population in Brazil, 2003 to 2011
Year
Health Insurance Beneficiaries with our without Dental
Private Plan Coverage
2003
31.771.197
18%
2004
33.673.600
18.8
2005
35.010.992
19.0
2006
36.841.907
19.7
2007
38.573.033
20.4
2008
40.497.917
21.4
2009
41.883.025
21.9
2010
45.584.144
24.0
2011 (June)
46.601.062
24.4
Source: ANS-Beneficiary Information Services and accessed at:http://www.ans.gov.br/index.php/materiais-para-pesquisas/perfil-do-setor/dados-gerais.
The largest of Brazil’s private sector healthcare providers is Unimed do Brasil.
Unimed is a distributed network of private providers, organized as a cooperative and now is the largest healthcare cooperative in the world. Unimed was founded in 1967 in Santos located in the state of São Paulo by one doctor and has since grown to include 372 medical cooperatives, 108,000 physicians, and 3,124 credentialed hospitals as well as thousands of clinics, emergency service clinics, and laboratories.[4]  Today, Unimed of Brazil serves 17 million clients and some 73,000 companies that provide healthcare to their employees and their families.  According to Unimed’s website, the cooperative comprises 37 percent of the private health plan market and remains the number one reference with respect to healthcare quality.[5]
            UniMed leads a host of major competitors, including: Admédico, Bradesco Saúde, Golden Cross, Good Life Saúde, Medial Saúde, Promed Assistência Médica, Samp, Assistência Só Saúde, and Sulamérica that compose over half of the private plan market place. According to the Agéncia de Saúde Suplementar, there are now 45 private plans with 100,000 or more beneficiares; and 38 of these plans now compose 50.2 percent of the entire national market.[6]  The gradual concentration of the private plan marketplace, beginning with UniMED, now creates significant opportunities for these health insurance and care providers to purchase medical and healthcare information products to better apply evidence based medicine to achieve the most efficient outcomes.
The growth of the private sector health care plans stems from the recent expansion of Brazil’s middle classes, the growing numbers of unionized workers whose employers now provide such plans, and ironically, public sector workers whose benefits now commonly include private sector health insurance benefits.  Zarrilli argues that the private sector seeks to expand its market by advocating policies that would focus the public sector and SUS on the basic health needs of the country, such as vaccinations, prevention campaigns, actions against epidemic diseases, sanitation, and providing health care only to that section of the population that is unable to join any private health plan; in other words, “the private sector would like to see the public health system reduce its role as direct supplier of health services, while increasing that of regulator and overseer. In particular, most feel that there is a need in the market for clearer regulations to ensure fair competition.”[7]


[1] Ibid. These figures are compiled from various sources and represent estimates; hence the difference in estimate years for the public and private sectors.
[2] Andrade, Mônica Viegas, Marina Moreira da Gama, Ricardo Machado Ruiz, Ana Carolina Maia, Bernardo Modenesi, and Daniel Matos Tiburcio. “Estrutura de Mercado do Setor de Saúde Suplementar no Brasil.” Unpublished manuscript. Universidade Federal de Minas Gerais, Faculdade de Ciência Econômicas, Centro de Desenvolvimento e Planejamento Regional. Belo Horizonte. 2010
[3] Zarrilli, 2002: 145.
[5] Ibid.
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[6] Agéncia de Saúde Suplementar. Accessed on Dec. 28, 2011 at: http://www.ans.gov.br/.
[7] Ibid. page 146.