CHILE: Inequity in Education, Health the Result of Privatisation

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Gustavo González

SANTIAGO, Jan 23 2003 (IPS) - The highest proportion of rejected university applicants this year in Chile was found among graduates of public high schools – one of the clearest indications of the inequalities generated by the partial privatisation of the country’s educational system.

Similar inequities are found in the field of health, where the participation of the private sector ushered in by the 1973-1990 dictatorship of Gen. Augusto Pinochet has also drawn constant criticism that quality of health care strictly depends on the capacity to pay and the ”risk” level of patients.

”In high school I got good grades, but my score on the PAA (academic aptitude test) showed me that in Chile there is one educational system for the poor and another for the rich,” Sandra Zúñiga, 17, who went to high school in Lo Espejo, a low-income neighbourhood on the southside of Santiago, commented to IPS.

The PAA is the test administered to secondary school graduates every December. The score obtained is crucial to acceptance in one of Chile’s 25 public or partially publicly-financed universities.

Juan Luis Moya, a graduate of the National Institute, the most prestigious public high school in Chile, obtained the top score on the PAA in December 2002, with 830 points, while Sandra was 12 points below the minimum score of 450 needed to apply to one of the 25 universities.

Like Sandra, 62 percent of the 52,477 graduates of municipally- run public high schools who took the PAA failed to obtain the minimum score that would allow them to continue their studies in the country’s public universities.

A large number of them will also be unable to attend a private college, due to the high cost of tuition.

”My only chance now is to enroll in a two-year course in a vocational-technical institute to become a dental technician,” said Sandra. ”That is the closest I could get to becoming a dentist, which is what I wanted to study, but I don’t know how easy it will be to find work afterwards.”

In contrast to the poor performance of students in the municipal high schools, 83.5 percent of the 19,114 graduates of tuition-charging private schools who took the PAA obtained scores above the minimum 450 points.

When the selection process for the 25 public universities was completed on Jan 20, authorities reported that only 25.6 percent of the 54,068 successful applicants came from public schools, 30 percent came from private schools that receive public subsidies, and 42.4 percent were graduates of private schools that charge tuition, where the children of upper-income families study.

The Pinochet dictatorship, which fragmented the University of Chile and the rest of the public universities, stripping them of their national character, opened secondary and higher education up to private sector participation, under which the state became merely another player in the educational system, and by no means the main one.

Under the new system, the subsidised private high schools receive state funding in accordance with the number of students enrolled, while private universities also receive state financing that increases to the extent that they attract high PAA scorers.

The system unleashed fierce competition, in which schools have resorted to increasingly sophisticated marketing techniques.

There are 40 private colleges and universities in Chile, both national and regional in character. Some of them are identified with business or religious groups, like Opus Dei or the Legionnaires of Christ. The Bernardo O’Higgins University was born of ties with the army, and its main patron is Pinochet himself.

As in education, inequality is the dark side of the privatisation of the health system opened up by the dictatorship in 1981 with the creation of the ”instituciones de salud previsional” (ISAPRE’s), private insurers which receive social security contributions and compete with the state National Health Fund (FONASA).

The ISAPRE’s provide health insurance and coverage that is financed by contributions amounting to seven percent of workers’ wages, the minimum proportion each worker is obliged to pay into the health system.

The private system offers health care plans that vary in cost according to the characteristics of each client.

The best packages are offered those who are ”low risk”, due to their age or medical and family history. For instance, a young man without children and with a high income has access to a better plan than a father of four earning a middle-range salary.

But the worst discrimination is seen in the case of women of child-bearing age, who pay up to four times what men in similar age and income categories are charged, due to the ”risk” represented by maternity.

The ISAPRE’s draw in people from low-income sectors by offering lower prices and fees than those charged by FONASA for basic doctor visits and simple treatments. But in the case of chronic, complex or catastrophic health problems, the costs are much higher and coverage is much thinner.

”I abandoned FONASA in 1994 to sign up with an ISAPRE,” taxi- driver Hernán Pozo told IPS. ”I was very satisfied until my wife was diagnosed with cancer two years later, and the coverage for chemotherapy was minimal. I had to return to FONASA, where I was able to afford the costs of the treatment until she died two years ago.”

But Adolfo Rodríguez, a 50-year-old engineer with a monthly income of around 2,000 dollars, said he was pleased with the private health care system. Thanks to the coverage he is given by his ISAPRE, he was only charged the equivalent of 80 dollars when he underwent prostate surgery six months ago in a private clinic.

Loreto Arévalo, a primary school teacher who is also enrolled in the private health system, underwent complex brain surgery two yeras ago to remove a malformation that was causing increasingly severe epileptic seizures.

The operation in a highly specialised clinic cost her 5,000 dollars out of her own pocket, while her ISAPRE only covered 3,000 dollars of the total cost.

Arévalo was only able to pay 2,000 dollars in cash, and arranged to pay the rest in monthly quotas, for which she had to leave a blank check in the clinic as a guarantee, which was loaned by a family member.

But when she failed to pay the November 2002 quota, the clinic cashed the check for the rest of the debt, around 1,800 dollars.

To pay back the family member who gave her the blank check, Arévalo had to take out a three-year emergency loan at a monthly interest rate of 1.3 percent.

”I’ll end up paying 50 percent more (a total of 2,700 dollars) than the original pending debt,” she remarked in an interview with IPS.

Although the World Health Organisation (WHO) ranks Chile 45th in the world with respect to overall quality of health care, it ranks this Southern Cone country 103rd in terms of equity of delivery and access to health care.