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Colombia President Gustavo Petro and his Health Minister Carolina Corcho on February 13 unveiled a massive national health system “reform” proposal that is already setting off alarm bells in Congress, among health-system providers, health insurance networks, insurance buyers and future patients.

According to the proposal – now facing weeks of debate in Colombia’s splintered Congress – most of the existing “Entidades Prestadoras de Salud” (EPS) health-insurance networks here would be abolished -- and the few remaining (seven in total) would be gutted and gradually transformed into vaguely-defined service providers, rather than health-network organizers and service payers.

Still unclear in the proposal is what would happen to existing or future private-sector prepaid health insurance (PHI) and “complementary” health-insurance policies and programs -- the latter of which are just appendages to current EPS policies.

The issue: If the EPS networks eventually die, then so could the “complementary” policies -- and maybe even the PHI programs, according to some analysts.

Ominous language in the new Petro proposal potentially could gut the value of such policies by forcing all PHI or “complementary” policyholders to use the new, government-monopoly health system, at government-dictated service prices -- with all the inherent bureaucracy, availability constraints, political corruption and horrendous service delays that Colombians had suffered decades ago, under the old, pre-EPS health system.

Under a similarly disastrous government-monopolized health-care system now operating in Brazil, one-third of the entire Brazilian population has already fled the bureaucratic public health system, opting instead for private, PHI networks – fortunately still allowed by law there, but at relatively high cost.

Petro’s public unveiling of the “reform” proposal drew pathetically small crowds of a few hundred supporters at government-organized rallies this week (February 13 and 14) -- in contrast to the massive anti-Petro, anti-health-reform protest marches in many Colombian cities today (February 15).

That’s not a favorable sign for Petro’s proposed health legislation, despite Petro’s well-known reputation for inciting angry divisions, chaos and violence (as in the “Primera Linea” riots of 2021) with extremist, demagogic oratory, typically featuring straw-man “enemies” along with clever use of factual distortions and outright lies.

Colombia’s existing EPS-network system arose from the “Law 100” legislation of 1993 – promoted and led by Petro’s long-time nemesis, former Colombian President Alvaro Uribe. That 1993 law replaced what had been an historically chaotic, corrupt, vastly underfunded, government-monopoly Social Security health system.

Under that prior Social-Security system, only 22% of Colombia’s salaried workers were covered for health care services, while another 40% of the population had to stand in line for government-subsidized services, many suffering or even dying long-before getting any help.

In contrast, today 99% of Colombians are covered by various EPS health insurance networks – a system that would be replaced by a new version of government monopoly, accompanied by new local/territorial health-service “districts” that would be vulnerable to becoming new centers of political corruption, huge waste and lengthy service delays, according to Colombia’s National Academy of Medicine (“ANM” in Spanish initials).

In a public letter to Colombian Health Minister Corcho this month – signed by ANM and 13 other Colombian health-sector associations – ANM warned that under Petro’s proposal to replace EPS systems with new health-system “territorial entities,” these new entities “do not have the capacity to audit and review accounts or to review billing by event prior to payment, which constitutes an imminent risk of overbilling by some IPS [hospitals and clinics] that can lead to a depletion of resources, compromising the financial viability of all IPS and the guarantee of the right-to-care for all residents in Colombia.”

Colombia’s existing Administrator of Resources for Social Security Health Care (“ADRES” in Spanish initials) currently sends all collected health premiums from employers, workers and government welfare agencies to the EPS networks for subsequent payments to hospitals and clinics for patient services.

But under the Petro proposal, ADRES would replace all EPS payment systems, creating a government-payment monopoly, eliminating private-sector competition, hence stifling innovation and economy – and creating great risk of political corruption, ANM warns.

Under the new scheme of local health-system “territorial entities,” ADRES would pay hospitals and clinics only as directed by these new “territorial entities” -- members of which would be appointed or nominated by people who could be connected to corrupt Mayors and other local politicians, as in the prior, pre-1993 Colombian health system.

“Decentralization/deconcentration [of medical-service reimbursements to hospitals and clinics], which implies the appointment of managers, the formation of boards of directors and functional overseers of spending, must be carried out with the guarantee of preventing regional politicking and corruption. Audits should not be a function of ADRES. This must be done by an administrator/regulator,” according to ANM’s public letter.

“The forms of payment to health service providers must be defined, whether involving direct payment, or prospective global payment, etcetera. Other forms of contracting must be analyzed and arranged with the providers, including evaluation of health results,” the ANM letter warns.

Another section of the Petro proposal would require the creation of tens of thousands of new, territorial medical teams, currently non-existent. “The country must know the plan to meet the proposed goals in terms of the 20,000 territorial interdisciplinary medical teams,” ANM’s letter warns.

“A policy and resources for professional training and continuing education must be defined. A reform to the health system that does not contemplate a transformation of health education is incomprehensible,” the letter adds.

Currently, Colombia’s EPS organizations collect health-insurance premiums paid by companies and workers (the “contributory” sector) as well as government welfare payments designed to cover unemployed and unaffiliated workers (the “subsidized” sector). The EPS subsequently sends payments to hospitals and clinics to cover bills for services for both sectors.

But replacing the EPS networks with new, territorial health networks will cost at least COP$52 trillion (US$10.6 billion) under the Petro proposal, with nearly half of that cost hike (COP$25 trillion/US$5.1 billion) resulting from the creation of new primary-care health centers around the country.

Another COP$11 trillion (US$2.2 billion) would be required for new health-center infrastructure and COP$9 trillion (US$1.8 billion) for “formalization” and upgrading of health-care workers, under the Petro proposal.

Nowhere in the proposal is there any explanation of how to pay for these spending increases, although certain vague language in the proposal would authorize President Petro to make unilateral decisions to fund whatever programs he would like – a provision likely to provoke opposition in Congress.

Meanwhile, while Petro claims that too many Colombians suffer from poor service under the existing EPS networks, his massive, government-monopoly “reform” scheme eventually would destroy the entire existing system – its good parts along with the not-so-good parts -- rather than surgically remove or replace diseased portions with cures.

That’s like bringing a reckless, incompetent knucklehead as the surgeon into the operating room, using a sledge-hammer rather than a scalpel.

So: Welcome to Petro Health Care, where many fear the ideologically inspired “cure” could become worse than the disease.

Medellin-based textile/clothing trade group Inexmoda announced July 29 that the annual Colombiamoda/Colombiatex trade show here attracted an all-time-record of nearly 50,000 attendees, while latest statistics show that Colombian clothing sales are up 9% so far in first half (1H) 2022 versus 1H 2021.

Among those attending the annual show here were some 25,000 admirers at fashion catwalks, as well as 11,300 buyers from 47 nations mingling with 476 exhibitors at the trade show.

What’s more, another 18,500 people attended the annual “wisdom and trends forum” presentations at “Knowledge Pavilion” events.

“Tourist spending for this 33rd edition of Colombiamoda+Colombiatex 2022 is higher than that seen in past editions, due to the record attendance at the event and which, in addition, meant a hotel occupancy of 91.7%,” the trade group noted.

“Colombiamoda+Colombiatex 2022 showed that it is an opportune moment to boost the fashion system and boost the economic growth that the industry has experienced this year,” added Inexmoda President Carlos Eduardo Botero.

Exhibitors showed-off the latest trends in footwear and leather goods, jeanswear, formal casual, beachwear, intimate wear, children’s wear, textiles and supplies, with participants including those from Uruguay, Mexico, United States, Portugal, along with key textile/clothing producers from the Colombian departments of Antioquia, Cundinamarca, Santander, Norte de Santander and Valle del Cauca.

Through 1H 2022, Colombian clothing sales to date have hit COP$14 trillion (US$3.28 billion), while 1H 2022 Colombian exports of textiles and clothing so far have jumped 26% year-on-year, to US$439 million, according to Inexmoda.

For all 12 months of 2022, Inexmoda now expects spending on clothing here to top COP$29.6 trillion (US$6.9 billion), up 6.8% year-on-year, while Colombia textile/clothing exports are likely to rise 15% year-on-year, to US$931 million.

EPM announced this morning (May 4) that -- following years of efforts – engineers have finally achieved permanent closure of a problematic auxiliary diversion tunnel (“GAD” in Spanish initials) that collapsed in 2018 and subsequently threatened to destroy the US$5 billion “Hidroituango” hydroelectric project here in Antioquia.

“This is a milestone for the stability of the project and mitigation of risks for the communities located downstream of the future hydroelectric generation plant,” according to EPM.
“With concrete plugs 23 meters long and 14 meters high, the GAD is permanently closed.”

Along with continuing reconstruction progress inside the dam's machine room, EPM is now confident of “starting to generate energy with the first two [power] units in the second half of 2022,” added EPM general manager Jorge Andrés Carrillo.

According to EPM, “closing the GAD was not an easy task, since it was naturally clogged [with rubble and Cauca River water], with the risk that it could unblock naturally at any time.”

So, during December 2019, the 300-ton blockage gates for each section of the GAD were lowered, which allowed for partial plugging. However, “despite this barrier, at least eight cubic meters per second of water continued to pass through a discharge system installed in the upper part of the gates, a considerable quantity that did not allow safe access for machinery and personnel” to enable permanent closure, according to EPM.

“To circumvent the situation, a maneuver called bypass was developed, which consisted of installing a piping system that allowed the water that entered through the GAD to be diverted to an intermediate discharge [tunnel] and, from there, to the spillway basin to rejoin the channel leading to the Cauca River.

“At the beginning of 2022, once this part of the GAD was dry, the auxiliary gates (right and left) were accessed to build the two concrete plugs -- 23 meters long and 14 meters high,” a job that took 600 workers and engineers four months to complete, according to EPM.

The GAD initially was constructed to divert the waters of the Cauca River while two other diversion tunnels were deliberately plugged in order to enable the required GAD to take-over the diversion job.

“In March 2018, when the process of pre-plugging the right tunnel began, the flow of the Cauca River continued to flow only through the auxiliary diversion tunnel, GAD,” according to EPM.

“This auxiliary tunnel was designed and built for temporary use. It was planned to operate only from September 2017 to July 2018, when it was planned to start filling the reservoir [behind the dam]. Afterward, it would be closed permanently.

“Its operation was interrupted as of April 28, 2018 when it became clogged and then reopened naturally on several occasions, which caused sudden flooding downstream and the destruction of the two closure gates that were already installed at that point.”

As a result, EPM rushed to close the GAD with temporary measures -- and accelerated completion of the dam along with the dam’s engineered spillway, enabling the Cauca River to flow over the spillway -- until reconstruction of the machine room will allow that water to flow through the power turbines, as originally intended.

Colombia President Ivan Duque and Health Minister Fernando Ruiz jointly announced this morning (April 25) that the face-mask mandate aiming to stifle  the spread of Covid-19 will ease starting May 1, 2022 – but only in well-ventilated areas where at least 70% of the local population has gotten at least two vaccine doses and 40% have gotten “booster” (typically three) doses.

In addition, people won’t be required to show their “MiVacuna” Covid-19 vaccination card at entries to leisure sites and “mass” activities, according to the official government statement.

However, the mask mandate will continue “in classrooms, offices, churches, public transport, commercial establishments and places without direct ventilation,” according to the bulletin.

“These measures validate a message: we have been fighting this pandemic, not only doubling Intensive Care Units, strengthening the health system, but also achieving a massive, safe, free and equitable vaccination system,” President Duque added.

To aid public education, the Health Ministry will publish an official list of municipalities where local populations have achieved the 70% vaccination rate against Covid-19.

As for travelers 18-years-and-older visiting Colombia, “the recommendation is that they arrive in Colombia with a complete double-dose, or, in the case of the Janssen vaccine, a single-dose,” according to the bulletin.

“Those [travelers] who do not have complete schemes or are not vaccinated will require a negative PCR test that does not exceed 72 hours and may also present an antigen test that does not exceed 48 hours” before arriving in Colombia, President Duque added.

To date, Colombia’s Covid-19 vaccination coverage exceeds 83% of the population for first- and single-doses, 69.2% for complete (minimum two-dose) applications and 34.7% for booster (typically three-dose) regimes, Health Minister Fernando Ruiz added.

While Colombia had initially created 2,700 special points-of-vaccination against Covid-19 nationwide, “today there are 4,700 points, since vaccinations are being done in the country’s hospitals and clinics,” Ruiz added.

“In Colombia we have spent more than COP$15 trillion [US$3.8 billion] on this pandemic, and the health system was able to respond. Those [Covid-19] patients who wound-up in an intensive care unit [ICU] paid practically zero, and that is not everywhere. In other countries people had to pay millions to be in an ICU.”

In addition, the Health Ministry has now settled massive, historic debts that had been choking the finances of hundreds of hospitals and clinics nationwide – clinics that couldn’t collect anything from indigent patients or else didn’t get paid by some deliberately negligent or bankrupt health-insurance networks (“EPS” in Spanish initials), although many of those wobbly EPS networks have since been liquidated, he added.

Colombia President Ivan Duque and Antioquia Governor Anibal Gaviria jointly announced today (April 23) at a dedication ceremony that the long-awaited “Puerto Antioquia” ocean-freight port linking Medellin and other major Colombia cities to the Atlantic is now starting construction and due for start-up in 2025.

“Puerto Antioquia is an historic megaproject that will allow us to promote the construction of the social fabric and strengthen the ocean freight, agro-industrial and tourist vocations of the lands of Urabá,” Gov. Gaviria stated.

The new port near Turbo, Antioquia -- carrying an estimated capex of US$627 million -- will be linked to the under-construction “Mar 1” and :Mar 2” highways westward from Medellin as well as major existing highway connections to Colombia’s coffee region and other cities including the capital, Bogota.

The port initially expects to handle 4.5 million tons of freight per year, including 3 million tons of agricultural products and 1.5 million tons of general freight, according to the developers.

Principal investors include global shipping giant CMA Terminals (22% share); Pio S.A.S. (11.1%); Eiffage Infrastructures S.A.S (22%); Termotécnica Coindustrial (5.17%); banana exporter Uniban (15.51%); Agrícola Santamaría (5.69%); Banafrut (4.14%); CI Tropical (6.21%); and Unión Para la Infraestructura (8.21%),

Project financing packages are coming from the privately held Financiera de Desarrollo Nacional (FDN) group, including a US$103.7 million package involving JP Morgan with loan guarantee from the Multilateral Investment Guarantee Agency (MIGA).

Another part of the new funding comes from the Inter-American Development Bank Group with US$200 million, plus US$30 million from Colombia’s Bancoldex import-export promotion agency and US$60 million from the Davivienda bank group here, according to FDN.

Aside from debt finance (59.6% of the total capex), the remaining 40.4% of capex (equivalent to US$280 million) is to be provided by the project partners.

The port is designed to handle ships of up to 366 meters in length, handling bulk products including coffee, grains, plantains and bananas, as well as general and containerized freight including automobiles.

Port developers estimate that the project will attract another US$720 million in nearby private investments from some 11,000 companies involved in freight logistics, customs, warehousing, trucking, maritime services, hotels, restaurants and many others.

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About Medellin Herald

Medellin Herald is a locally produced, English-language news and advisory service uniquely focused upon a more-mature audience of visitors, investors, conference and trade-show attendees, property buyers, expats, retirees, volunteers and nature lovers.

U.S. native Roberto Peckham, who founded Medellin Herald in 2015, has been residing in metro Medellin since 2005 and has traveled regularly and extensively throughout Colombia since 1981.

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