It is counterproductive for the 119 contracted private hospitals and the SSO to adopt a confrontational stance and turn the disagreement into a bluffing game. The SSO is suggesting that the contracted private hospitals are trying to make excessive profits from medical services provided by the SSO to its members, while some hospitals, citing rising costs, threaten not to renew their contracts as healthcare providers unless the rate - which currently stands at Bt1,555 per head, per year - is adjusted.

The dispute over what constitutes a fair rate for medical services should be decided by the SSO medical service committee, which comprises representatives of the Public Health Ministry and public (hundreds of public hospitals are also contracted to provide services to SSO members) and private hospital administrators. The committee is expected to make recommendations soon on the rate adjustment to the SSO board, which will make the final decision.

It is only natural for the SSO to want to keep the cost of medical services low and for profit-oriented private hospitals to want to continue making a considerable profit from the medical services scheme.

The SSO was set up to provide a wide range of services for members, from medical care and cash for maternity, unemployment and disability as well as pensions and death benefits. The current per-head rate paid to contracted hospitals has not been adjusted for about two years while the cost of medical services is assumed to have risen significantly during this period. The dispute came into the open as the SSO medical service committee is trying to decide on a rate adjustment that would maximise cost-effectiveness while at the same time keeping contracted hospitals motivated to provide good services by offering them a healthy profit margin.

It is a foregone conclusion that any rate adjustment will be gradual, and it would be unrealistic for the rate for SSO medical services to jump to the same level as the government's universal healthcare scheme, for which healthcare providers receive just over Bt2,000 per head per year. That is because most people covered by the SSO medical scheme are relatively young, healthy workers who do not require as much medical attention as those under the universal healthcare scheme which covers all age-groups including the very young and elderly.

The SSO has experienced remarkable growth since its inception in 1990. It now covers over nine million workers at more than 350,000 workplaces with a staggering Bt403 billion in the Social Security Fund at its disposal. Using a tripartite system, an employer and employee each contribute the equivalent of 5-per cent of a worker's salary, between a minimum of Bt83 and a maximum of Bt750 per month, while the government contributes another, variable portion.

The medical service provided by the SSO is its single most outstanding success, with Thailand's social security system one of the first to adopt a per-capita payment method, under which healthcare providers are paid up front by the government in accordance with the number of registered patients assigned under their care. Healthcare providers are expected to manage their budgets and balance their books on their own, making some profit while the SSO benefits from the ability to keep costs under control.

Up until now the SSO medical service has never had a financing problem because its operations have been so meticulously planned with long-term sustainability in mind. It is imperative that the SSO continues to control the cost of medical services and other costs - but not at the expense of compromising on the quality of service provided. The new rate for medical services must be considered fair for SSO members and healthcare providers.