The financial crisis of Ecuador’s Social Security (IESS) system is being solved, according to the the system’s president Manolo Rodas. “We are on the road to recovery and long-term sustainability,” he said in a recent interview.
Rodas says a “top-to-bottom” audit of the system’s pension and health care programs is underway, as well as procedural studies conducted by the University of Cuenca and the National Polytechnic University. “These reports will accurately reflect the conditions of the system and will allow us to take measures to guarantee the system remains healthy,” he says.
He added: “In the past, a big problem was that we did not have accurate data from which to make decisions. Now, we are generating that information.”
Among the measures Rodas says will ensure IESS’s health, are the government’s decision to resume direct financial support of the system. In 2015, the government of former president Rafael Correa withdrew its support, saying that the system should operate entirely on member contributions. Rodas says that decision was made without proper planning and put the system at financial risk. He said the government will contribute $1.4 billion in 2018 and that the contributions will continue.
In addition to the infusion of federal funding, Rodas said cost-cutting measures in the IESS health care services are resulting in savings of about $470 million. “We have imposed an austerity plan, cutting costs in the procurement processes for supplies, medicines and equipment, and by reducing office overhead,” he says. “We are also saving money by providing more medical care within the system instead of referring it to private clinics and hospitals.”
Rodas said that service problems, such as a lack of medicines and medical supplies at IESS pharmacies is being addressed system-wide. “Member services will be improved through better planning and improved organization. We understand that this has been a major problem for some of our members.”