One of my best friends for many years was a Cuban fellow named Miguel Cárdenas who left the island much later than the Mariel boatlift, and somehow ended up in Ohio. At first he did very well for himself, but eventually got in trouble and lost his US residency privileges and was returned to Cuba. I was able to talk to him a couple of times after he was back in Cuba, but also stayed in touch with his family.

Once I visited Miguel when he was in Cali (long before I lived in Colombia) where his sister, an official in the Cuban government, was allowed to travel. At the time, a rendezvous in a third country was the only way they could meet. His sister, who had achieved a prominent position in the agriculture ministry, eventually left and resettled in Miami. She now tells me that her quality of life working at Walmart in Miami is much better than when she was a government bureaucrat in Havana. Because of her position, she was one of the first Cubans allowed to have an internet connection and actually had a Facebook account before everyday Cubans even had internet.

After Miguel was back in Cuba, he got in an auto accident, and was in pretty bad shape. This was around 2011. I remember getting a call from his sister (she was still in Cuba). Miguel was in the hospital, but there was no medicine, no bandages, no supplies, and and she asked me to find these items in the US and send them to her in Cuba for his treatment. What many people don’t realize is that medicines and food can be sent to Cuba from the United States, and that in any case, the US trade embargo does not prevent commerce in medical goods-or any products from any other countries. Cuban hospitals, like Cuban grocery stores are empty because their totalitarian, communist system is a failure.

My friend died shortly after I spoke to his sister, before I was able to ship medical supplies for his treatment. The “revolucionario” Cuban medical system cannot provide basic supplies; not because of any US embargo—remember during the COVID pandemic, all the supplies were coming from China?—but because the Cuban economic, political and health systems are BANKRUPT.

“There is all the difference in the world between treating people equally and attempting to make them equal.”—F.A. Hayek

Is this Francia’s idea of “vivir sabroso?”

Colombia’s Vice President Francia Marquez was in Cuba last week, where she continued to trash Colombia’s health system and pour accolades on the Cuban system.

“We are proposing a health reform where it is once again administered by the State. Of course, this is not going to be easy because there is a very strong dispute. It is taking away the business of the elite and private sectors that have turned health into a commodity and not a fundamental right. The preventive health that you (Cubans) have maintained as a central axis is what we want to do in Colombia today,” said Vice President Márquez.

Francia Márquez en ?? dijo que estamos proponiendo una reforma a la salud donde el Estado recupere su manejo y que se le quite a las “élites”que se han enriquecido. Alaba el sistema cubano y busca que aprendamos de su experiencia.

Es una vergüenza. pic.twitter.com/jwrxzav5D0

— Ani Abello (@ANIABELLO_R) February 13, 2023

Colombia has a mix of public and private hospitals and clinics, with many doctors in private and specialty practice. Doctors have a choice of participating in public or private healthcare plans or participating in no plans at all. The vast majority of doctors participate in the country’s EPS system.

In Colombia, clinics, or points of care where patients are seen, are called IPS – Institución proveedor de Salud, or health providing institution, in English. Colombians with formal employment choose from a number of health plans, called EPS – Entidad proveedor de Salud, which serve as intermediaries. EPS plans may be private businesses, for example the insurance giant Sura, or they may be government owned, like the city of Bogotá’s Capital Salud. Some EPS systems are poorly managed, corrupt and insolvent, others are very well managed. Doctors and IPS facilities can choose to accept one or more EPS plans, or accept none. Most accept multiple EPS providers. Some EPS providers are notoriously slow payers.

Colombians below a certain income level also qualify for Sysben subsides designed to allow those of the lowest income levels to access the same health care benefits as the rest. Victims of auto accidents are also covered by mandatory SOAT insurance, which covers death, injury, lost wages, and physical therapy due to vehicular accidents.

Colombian President Gustavo Petro presents his proposal for reworking the Colombian health system (photo

Higher income Colombians may also pay cash for services, or purchase a private, prepaid medical plan that usually, but not always, sits atop an EPS plan. The government mandates that all employees and independent contractors participate in EPS. There is also a worker’s compensation system called ARL that covers workplace accidents.

Doctors generally make a good living in Colombia, though the pay is not exorbitant. You might see a typical doctor making between the equivalent of $40,000-$60,000 USD which in Colombia is quite a bit. Specialists and aesthetic surgeons can make quite a bit more, with owners of successful practices pulling in several hundred thousand dollars per year, but this is the tiny exception. In Cuba? $32 USD per month.

No health system is perfect. In the US, there is groundbreaking treatment, but heartbreaking prices. Canada and the UK claim to offer “free” health care, which of course is not free, but disguised through taxation, and patients often have to wait years suffering painful conditions before treatment. Treatment may also be rationed based on cost and staffing limitations.

In Colombia there are several inadequacies, but the biggest is an unequal availability of services based on geography. Bogotá, Medellín and Cali all boast world class hospitals, and many modern specialized treatment centers. MRI, CAT scans, even PET scans are available. Many foreigners come to Colombia for knee replacements, back surgery, and of course, cosmetic surgery. The cost of the entire procedure might be less than the co-pay plus deductible in the patient’s home country.

On the other hand, travel to rural regions of Colombia, or tertiary cities, and it is a different story. Not only is there a lack of facilities, but a lack of medical professionals, especially specialists. Add to this a high incidence of corruption in regional EPS providers and local governments. This stark inequality means that in the same country, one may receive world-class treatment, or practically no treatment at all based on a combination of one’s income and geography.

Meanwhile, there is no shortage of medicines or durable medical supplies. Pharmacies are plentiful and well stocked, and most medicines are affordable. The government maintains a list of critical medicines and has measures in place to assure that these critical medicines are available and affordable.

Marquez has been explicit in her desire to destroy the concept of healthcare as a business in Colombia. But fortunately, it is unlikely that she will ever get the chance. Grocery stores and pharmacies in Colombia are full, and there are mobile phones in every pocket in Colombia, because they are provisioned by businesses. Overall, Colombia has an excellent electrical grid compared to many other Latin American countries, and much of the electricity is provided by private businesses. Even the utilities like EPM or EEB that have government involvement are indirectly owned and must follow corporate government best practices. For example, petroleum giant Ecopetrol is between 80-90% owned by the Colombian government, but because a minority of shares are traded on the New York Stock Exchange (NYSE: EC), the company must behave as a corporate citizen and cannot be treated by the Colombian government as a sinecure for friends and cronies. Voluntarily trading on the NYSE, the company, its employees and directors are subject to US securities law.

The good news

Leftist President Gustavo Petro, formerly a militant guerilla, would surely love to have an entirely government-controlled health system—an entirely government controlled economy if his wishes came true—but fortunately Colombia has enough institutionalism to prevent a Venezuela-style usurpation, or Cuban style “revolución,” though groups like the FARC and ELN did try.

Petro wants to get some kind of reform passed, and that still may be difficult. However, the president has pledged via the country’s official presidential website that:

“Complementary plans, prepaid medicine or health policies will continue to function normally and will not be affected by the project.”

This is critical. And let us also be clear, one of President Petro’s stated objectives to provide an equal basic level of care throughout the country is a very good thing. This is something the country currently lacks. People in Tumaco or Catatumbo do not have the same access to healthcare as people in the south of Cali or the north of Bogotá. However, increasing the quantity of health care throughout the country, should not come at the expense of the quality of health care.

Colombia is in fact a very unequal country, and this inequality should be addressed by creating more opportunities, providing better, more universal education, and yes, challenging the pretty awful class hierarchy that exists in Colombian society. However, Friedrich August Von Hayek admonished us all that:

Even the striving for equality by means of a directed economy can result only in an officially enforced inequality—an authoritarian determination of the status of each individual in the new hierarchical order.

Headline photo: Vice President of Colombia, Francia Márquez Mina (left) with Cuban President Miguel Díaz Canel (Photo: Colombian Government) during her visit last week.

“No one can force us to commit suicide.”—Dr. Sergio Isaza

These charges are made by Dr. Sergio Isaza, head of the Colombian Medical Federation, the group representing the interests of Colombian doctors in the country. The doctors oppose Article 9 of Decree 538 of 2020 issued by the Colombian presidency, that seeks to obligate doctors to attend to the Coronavirus COVID-19 Pandemic irrespective of circumstances.

Dr. Sergio Isaza, head of the Colombian Medical Federation (Photo courtesy of the Colombian Medical Federation)

“We are not obligated by a decree, but by the oath we took when we graduated; not under any threat of sanction so the minister must remove that article,” said Dr. Isaza to W Radio in Colombia. Representatives of the federation, accompanied by the Colombian Association of Scientific Societies, The Colombian Medical College, and the Federation of Medical Unions walked out of negotiations with the government when they refused to amend Article 9. That led to a breakdown in relations between the four groups and the newly appointed health minister, Dr. Fernando Ruíz (above right).

21 doctors in Cartagena have already resigned from hospital Clinica San José de Torices. The doctors claim that they have repeatedly and formally asked for basic protective equipment but were ignored

“Doctors must be equipped according to the complexity of the patients they serve: gloves, gowns, masks, hospital clothes; guaranteeing the dressing rooms and that the staff should not go out with the same clothes that they use in the clinic for their home,” said Dr. Isaza. “It is not just that they give us gloves, masks, robes and dresses, because it is something to be expected. That is why the National Government must sanction the EPS (health plan providers) and IPS (clinics and hospitals), and punish those who fail to comply. This must be monitored by the National Health Superintendence, which has done nothing, in addition to the Office of the Attorney General and the Comptroller,“

Endemic Corruption

Colombia has a mixed public/private health care system that ranges from world-class to 3^rd-world depending upon geography, funding model and management. Hospitals may be public (government owned) or private. Along with specialty clinics, larger doctor’s offices and urgent care facilities, these are classified as IPS (Independent Health Provider) and may charge patients directly or receive payment by the various EPS (Health Provider Entity) programs. EPS are similar to health insurance plans or cooperatives and are generally paid for by employers or the government. In the case of independent  workers, they are paid directly by the policyholder. Low income residents have their EPS premiums subsidized or paid for by the government. Some EPSs are well run, others are mismanaged, then others still are flat out corrupt. Hospitals complain that EPS plans generally run several months behind in payments. Employees, rather than employers choose their EPS, then the employers contribute a fixed amount to the EPS coverage, irrespective of which the employee chooses.

Two Colombian doctors, Dr. Carlos Nieto and William Gutiérrez have already died due to the COVID-19 virus.

Optionally, Colombians and foreigners alike may purchase “medicina prepagada,” or private health insurance that works “on top” of EPS plans. These deluxe plans provide an additional level of care with separate facilities and doctors, and benefits such as doctor’s house calls, sports medicine, and coverage abroad for traveling policyholders.  Some companies, like SURA operate EPS plans, private insurance, and their own hospitals and clinics.

Doctors, clinics and hospitals may also charge patients “cash” directly, and some choose to completely opt out of government or private insurance arrangements.

On the other hand, many hospitals are government run and EPS plans serving low income patients are built around payments from SYSBEN, Colombia’s welfare plan (similar to Medicaid in the US). This creates tremendous opportunities for corruption. The Colombian government is already embroiled in “Coronavirus Corruption” with the government depositing COVID-19 Pandemic relief funds into thousands of ghost accounts, and procurement irregularities.

Many government hospitals have begun construction over the years but were never finished, with politicians and contractors bagging the funds allocated by local, departmental and the national government agencies.

The new mayor, William Dau, who ran on an anti-corruption platform in the historically corrupt coastal city of Cartagena let loose an expletive-laced tirade that put entrenched members of city-council such as Cesar Pión on the defensive. The citizens of Cartagena broke out in a spontaneous “cacerolazo” in support of their new mayor after his emotional diatribe. A “cacerolazo” is a type of protest in Latin America where people noisily bang on pots and pans outside of their windows.

A esto nos ha llevado la Clase política de Cartagena.
Se robaron toda la red hospitalaria, sumieron a la ciudad en pobreza, estancamiento, desigualdad.

No me preocupan la expresiónes del Alcalde, me preocupa mas ciudad.

Apoyó a @daulaw pic.twitter.com/TBG4V4vIpn

— Wilman De Los Reyes Franco (@Wilman_1998) April 13, 2020

Mayor Dau (pictured in above tweet) pointed out  more than a dozen unfinished hospitals in Cartagena; monuments to the city’s corruption and the avarice of its traditional political families.

On the defensive, Colombian Government Responds

Friday, the presidency announced that it was going to allocate $175 million USD immediately to purchase the receivables of hospitals, medical practices and IPS that are owed money by EPS plans. This is in addition to the $91 million already allocated to the EPS system, money that may or may not matriculate through to hospitals, IPS and doctors.

“Today I signed Resolution 619, which opens the portfolio purchase in ADRES (Administrator of the Resources of the General System of Social Security in Health) for $ 700,000 million COP,” said Minister of Health Fernando Ruiz (top photo, right), who stressed that the purchase is direct and not through the financial system.

“Right now we are working very intensively so that, from June and hopefully from before, from May, we can start turning over all of these resources, the $ 5.2 billion we have there and that would give immediate liquidity to the system,” said the minister.

Colombia’s president Ivan Duque (top photo, left) has announced that this week the government will disclose health measures that will remain in place when the 24-hour national pandemic is expected to be lifted on April 27^th.