Costs and Benefits of Implementing Child Survival Services at a Private Mining Company in Peru Karen G. Foreit, PhD, Delia Haustern, MD, Max Winterhalter, MD, and Emesto La Mata, MD

Inbotdion

Results

As public resources stagnate, developing countries must find alternative sources of financing for primary health. One underutilized resource is the commercial sector. Approximately 10% of the 1984 health expenditures in Peru were covered by payments made by employers,1 a source that could be tapped for preventive health care. Most commercial health plans only cover curative care. The present study examined whether expenditures for curative child health care could be reduced through preventive interventions and better prescription practices, while maintaining or improving quality of care. The study site was a privately owned Peruvian mine that provides medical coverage to approximately 800 workers and 4000 dependents, including 900 children under age 5. Despite company investments of $1.7 million in welfare and medical care, the population showed high morbidity. A prospective cost-benefit analysis found that family planning and child survival services could improve health status, at a cost that would be compensated by savings in other services averted. The company implemented the recommended services; this report summarizes the findings ofthe child survival component.

Baseline Conditions

Methods Baseline conditions were assessed during 1986 and 1987. Data included company records and household and clinic surveys. The household survey was conducted in July 1986, with a random sample of 220 miners' wives. The clinic survey was conducted in March 1987 and included 132 consultations with children under age 5. Preventive health services were added in 1988. A follow-up conducted in late 1989 included service statistics, a campwide census, and a clinical survey that captured 206 visits by children under age 5. Wholesale costs ofmedications prescribed were calculated at baseline and at

follow-up.

Infant and child health were precarious at the start of this study. Infant mortality was estimated at 120 deaths per 1000 live births. Contributing factors included lack of well-baby care, low vaccination coverage, high incidence of diarrhea and respiratory infection, and overmedication and use of inappropriate medications. Lack of well-baby care. All consultations surveyed were motivated by illness. Physicians reported that they had no time for well-baby care and that mothers would not use it if it were offered. Vaccination. The household survey found that fewer than 5% of the children ages 1 to 4 were completely vaccinated. No child was vaccinated during an observed clinic visit. A quarter of the children over age 1 who had not been vaccinated spontaneously reported having had measles.

Morbidity. Of the children surveyed, 44% reported diarrhea and/or cough in the last 3 days; 24% reported diarrhea and 29% cough. Half the reported cases of diarrhea and/or cough did not seek treatment. Nevertheless, children under age 5, although they make up only 17% of the population, accounted for 50%o of all clinic visits. Etiology was not determined, but the high incidence of blood and/or mucus in the stool accompanied byvomiting suggests shigelloSis.2 Respiratory infection accompanied by diarrhea is characteristic of rotovirus. Overmedication. International norms suggest minimal medication for diKaren G. Foreit is with The Futures Group, Washington, DC. Delia Haustein is with Asociacion Benefica Prisma, Lima, Peru. Max Winterhalter is with Instituto Marcelino, Lima, Peru. Ernesto La Mata is with Milpo Mining Company, Lima, Peru. Requests for reprints should be sent to Karen G. Foreit, PhD, Senior Research Analyst, The Futures Group, 1101 Fourteenth Street, NW, Washington, DC 20005-5601. This paper was submitted to the journal July 11, 1990, and accepted with revisions March 6, 1991.

American Journal of Public Health 1055

Public Health Briefs

arrhea and respiratory infection: oral rehydration and ampicillin for diarrhea with blood or mucus, acetaminophen and benzathine penicillin for moderate respiratory infection, etc. Nevertheless, every patient under age 5 received at least 2 and on average 3.7 medications, regardless of symptoms. Prescriptions for respiratory infection and diarrhea exceeded international recommendations (see Table 1). Prescriptions were classified according to the Physician's DeskReference3 and its Peruvian counterpart, Diccionario de Especialidades Famnaceuticas.4

Inteivention The study recommended that the mine hire an additional physician and nurse to provide well-baby and maternal care, and follow World Health Organization norms5 for treating acute respiratory infection (ARI) and diarrhea. First-year costs were estimated at $8065; projected savings in pharmaceuticals ranged from $10 600 to $12 600 per year. The company hired extra staff and contracted for training and on-site supervision. Services began in May 1988, in coordination with a national vaccination campaign. During the first quarter of 1989, standardized diagnostic and treatment protocols for ARI and diarrhea were adopted, and management contracted for a second year of supervision. 1056 American Journal of Public Health

Program Impact Vaccination coverage. The census found 75% coverage among children ages 1 to 4. Virtually all children under age 1 had been appropriately vaccinated. Well-baby care. Of all clinic visits made in November 1989, 16% were for well-baby care, compared with none at baseline. Approximately 90% of children under age 1 and 35% of children ages 1 to 4 had been enrolled in growth monitoring. Thirty-nine children with second- and third-degree malnutrition were enrolled in nutritional rehabilitation; 31% returned to normal. Treatment of diarrea and respiratory infection. During 1989 the clinic treated 2258 cases of respiratory infection and 1233 cases of diarrhea among children under age 5. As shown in Table 1, physicians prescribed on average one fewer medication per consultation; mean number of antimicrobials prescnbed for ARI and diarrhea decreased from 1.5 to 0.5.

Costs and Savings During the first 2years, the company invested $13 200 in new child services at a cost per capita of less than $7.50 per year, compared with baseline per capita expenditures of $160 for curative care. After 18 months, annual prescription savings were approximately $5000 (January 1990 prices). Assuming linear trends, savings during the first 2 years totaled

$6800 without considering improved health status due to better vaccination and nutrition practices. Table 2 presents program costs and estimated savings.

Discussion Most child survival efforts focus on children outside the formal health system. However, many children inside the system also do not have access to preventive care. Furthermore, access to curative services does not guarantee use of services or that appropriate treatment will be given if sought. Consequently, even children covered by private plans may suffer from poor health, and company costs are inflated by improper prescription practices. The present study demonstrates that preventive health can be provided at modest costs and achieve significant savings. Mothers accepted well-baby services and had no complaints about reduced medications. The advantages to the employer of preventive health care are clear. In 1989, two more mines initiated services. If the model is replicated throughout the mining community, more than 200 000 children in the most remote locations in Peru will benefit. [1

Acknowledgments Thisworkwas supported byContract No. AID/ DPE 3035-C-5047-00 between John Short & Associates and the US Agency for International Development under the auspices of the Tech-

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Public Health Briefs

nical Information on Population for the Private Sector (TIPPS) Project. This paper is dedicated to the memory of Bruno Lesevic, MA. The authors wish to thank the Milpo Mining Company for offering unlimited access to records and facilities. They also acknowledge the participation of Carlos Aramburu, Miriam Rojo, and Salvador Baldizon. An earlier version of this paper was presented by Foreit, Baldizon, and Winterhalter at the 117th Annual Meeting of the American Public Health Association, October 1989, Chicago, Ill.

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References 1. Zschock DK, ed. Health Care in Peru, Resources and Policy. Boulder, Colo: Westview Press; 1988. 2. Berkow R, Talbott JH, eds. The Merck Manual ofDiagnosisand Therapy. 13thed. Rahway, NJ: Merck Sharp & Dohme Research Laboratories; 1977. 3. Baker CE, publisher. Physicians' Desk Reference. 34th ed. Oradell, NJ: Medical

Economics Company, Litton Industries, Inc; 1980. 4. Panamericana de Libros de Medicina, SA. Diccionano de Especialidades Fannaceuticas. 1st ed., Peru. Bogota, Colombia; 1982. 5. World Health Organization. Treatment of children with acute respiratory infection: simplified models for therapeutic decisions. Personnel Training Modules, WHO/CDC, ECP/ARI. Geneva, Switzerland; 1985.

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Costs and benefits of implementing child survival services at a private mining company in Peru.

Costs and savings of child health services were studied in a private mining company in Peru. Despite considerable outlays for medical services, few ch...
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