Trinh Thi Phan Lan Public service units in the health sector are given financial autonomy and can proactively use regular budget sources and revenue sources to carry out professional tas
INTRODUCTION
Research context
The healthcare system in Vietnam plays a pivotal role in the country's socio- economic development In recent years, the health sector has made significant strides in protecting, caring for, and enhancing the health of the population To support these goals, the Government has implemented several major policies related to the health system Among these, granting autonomy to hospitals is viewed as a key policy, aligning with the country's development trajectory Notably, Decree 10/2002/ND-CP, which initially granted financial autonomy to revenue-generating public service units, was replaced in 2006 by Decree 43/2006/ND-CP This updated decree expanded autonomy and self-responsibility in task performance, payroll organization, and financial management for public service units These policies encompass all public service sectors, including healthcare and medical examination and treatment facilities (Government, 2006; Ministry of Health, 2010) This reform is crucial in Vietnam's administrative overhaul, enabling public service entities to thrive and evolve within the socialist-oriented market economy framework The policy empowers health sector public service units to proactively achieve professional goals and tasks through organizational and personnel restructuring (Nguyen, 2020)
In the health sector, public service units are granted financial autonomy, allowing them to utilize regular budget allocations and revenue sources to perform professional duties These units can also establish and enforce internal spending regulations, thereby enhancing the efficiency of financial resource utilization Successful operations that increase revenue, reduce costs, and generate a surplus can allocate part of the surplus to augment staff incomes, with some funds being set aside for further investment (Tran, 2010)
To fulfill this important mandate, institutions must leverage their potential, prioritizing state investments with a strong emphasis on financial management Given new tasks and conditions, it is imperative for institutions to enhance their financial management capabilities This enhancement will facilitate coordination with other
2 areas of training and medical examination and treatment, contributing to the sustainable development of the institution (Dinh, 2021)
Based on the theoretical and practical understanding outlined above, I have chosen the topic "Improving Financial Management at the Central Institute of Hematology and Blood Transfusion" for my master's thesis in financial management
My goal is to contribute to the broader research process and strengthen the institute's financial management, aiming for financial autonomy in line with the country's development trend to maximize and effectively utilize financial resources.
Research objective
Based on the principles of financial management of public service units in the health sector and the current situation of financial management implementation at the Central Institute of Hematology and Blood Transfusion, the proposed topic aims to suggest solutions to help the institute perform better in financial management, contributing to the development of the institute towards efficiency and sustainable development.
Research subjects
Autonomy, self-responsibility, and financial management mechanisms of the Central Institute of Hematology and Blood Transfusion.
Research scope
Research Content: Focusing on researching the financial management activities of the Central Institute of Hematology and Blood Transfusion, and state policies towards medical staff in the medical field are considered from the perspective of influencing factors on the financial management of the Institute
Research Space: Central Institute of Hematology and Blood Transfusion
This research study aims to examine the current status of financial management at the Central Institute of Hematology and Blood Transfusion from 2020 to 2022, with the ultimate goal of proposing effective solutions to enhance financial management practices in the years to come.
OVERVIEW AND THEORETICAL BACKGROUND OF
Theoretical background of public service units
2.1.1 Concept of Public Service Unit
Public service units (DVSNCL) are organizations established to carry out public service activities These activities provide essential services to society to maintain and ensure its normal functioning Professional activities conducted by these units do not directly create material wealth, but they significantly impact productive forces and production relations, determining society's labor productivity These professional activities are primarily service-oriented and not profit-driven (Nguyen, 2020; Dinh, 2021)
Public service units are defined based on the following criteria: there is a formal establishment decision by a competent authority at the central or local level; they are provided with funds and assets by the state to perform political and professional tasks and are allowed to generate certain revenues according to state regulations; they have a payroll and accounting apparatus according to state regulations; they are independent units with legal status, their own seal, and accounts opened at the State Treasury for financial revenues and expenditures (Tran, 2010)
2.1.2 Characteristics of Public Service Units
Public service units operate on the principle of serving society, not for profit Unlike production and business activities, public service activities provide services to the economy, but their primary purpose is not profit-oriented The state maintains, organizes, and finances non-business activities to provide services to the market, primarily to execute its role in redistributing income and implementing public welfare policies by intervening in the market (Government, 2006; Ministry of Health, 2010) This support from the state helps economic sectors operate normally, raises people's knowledge, fosters talents, ensures and develops human resources, and promotes
4 economic activities to develop more effectively, thereby improving people's lives, health, and spirit (Nguyen, 2011)
Public service activities of the Youth Union are closely tied to and directed by the state's socioeconomic development programs In a market economy, the state plays a crucial role in organizing and sustaining these activities to fulfill socioeconomic development objectives The state devises policies, guidelines, and specific programs, such as anti-poverty and literacy initiatives, to achieve these goals The implementation and effectiveness of these programs heavily rely on the state's involvement Moreover, the state fosters and develops public service activities in conjunction with national target programs and socioeconomic development initiatives to enhance the well-being of citizens, as emphasized by the 11th National Assembly in 2002.
The primary outcome of public service activities is the creation of public services, directly or indirectly serving the social reproduction process The use of public goods created by public activities facilitates the reproduction of material wealth in society, making the process more efficient Professional activities in health, education, and sports impart knowledge and ensure the health of the workforce, creating conditions for better quality human resources (Central Institute of Hematology and Blood Transfusion, 2020)
2.1.3 Classification of public service units
2.1.3.1 Classify units by revenue source
Units exercising autonomy and financial responsibility are those established by a competent state agency (independent budgeting unit, with its own seal and account, and organized accounting apparatus) according to the provisions of accounting law Based on non-business revenue sources, public service units are classified to exercise financial autonomy and self-responsibility as follows:
Units that self-guarantee all regular operating costs: These are units that cover their operating costs entirely through non-business revenue sources, without requiring state budget support (Dinh, 2021)
Units that self-guarantee part of their regular operating costs: These units cover a portion of their operating costs through non-business revenue sources, with the remaining costs subsidized by the state budget (Tran, 2010)
Units with low or no non-business revenue sources: These units have either minimal or no revenue sources and rely entirely on the state budget to cover their regular operating expenses They are referred to as public service units guaranteed by the state budget (Nguyen, 2020)
The ability of a revenue-generating public service unit to cover its regular operating costs is determined based on the following criteria:
Units that self-assure their operating costs: These units cover 100% or more of their regular operating costs through their own revenue sources, thus not requiring any state budget for regular operations
Units that self-guarantee part of their operating costs: These units cover between 10% and 99% of their regular operating costs through their own revenue sources The state still provides the remaining portion of their regular operating expenses
Units with all operating costs guaranteed by the state budget: These units cover 10% or less of their regular operating costs through their own revenue sources Applicable to units with low or no revenue sources, the state provides all regular operating expenses
This classification helps in identifying the financial autonomy and responsibility of public service units, ensuring efficient and effective use of financial resources
2.1.3.2 Classification of staff according to field of activity
Classifying staff according to their field of activity allows for a more organized and efficient management system within public service units (DVTSN) This classification ensures that each unit operates within its specialized domain, thereby
6 enhancing overall productivity and service quality The classification can be detailed as follows:
Firstly, non-business units operating in the field of health are primarily focused on providing medical services, conducting health research, and improving public health These units include hospitals, clinics, and health research institutes Their role is critical in maintaining public health, reducing disease burdens, and enhancing the quality of life through medical care and research (World Health Organization, 2020)
Secondly, non-business units in the field of culture and arts are dedicated to preserving and promoting cultural heritage, arts, and humanities These units include museums, art galleries, cultural centers, and performing arts organizations They organize exhibitions, performances, cultural events, and educational programs to foster public appreciation of the arts and culture, thereby enriching the cultural landscape and supporting tourism and community engagement (Smith, 2019)
Moreover, non-business units operating in the field of education and training encompass a wide range of public educational institutions, from primary schools to universities and vocational training centers These institutions are integral to the national education system, providing formal education and skill development opportunities Their objective is to develop a knowledgeable and skilled workforce essential for economic growth and social development (Jones & Smith, 2021)
Financial management of public service units
2.2.1 Financial concepts and financial management of public service units
Finance, an intricate system of economic interactions, emerges during the allocation of financial resources This process involves the establishment and utilization of monetary funds to fulfill the accumulation and consumption demands of various societal entities.
Management involves performing tasks that direct, regulate, and coordinate the activities of subordinates and people under one's authority This is specifically expressed through planning activities, ensuring organization, coordination, inspection, and control Management is the organized, targeted impact of the management subject on the management object to achieve set goals It is the best method to achieve the common goals of a group of people or an organization The effectiveness of management depends largely on the subject, object, goals, methods, and management tools
Financial management is the management of activities related to mobilizing, allocating, and using financial resources through integrated methods, which include various measures implemented based on the application of objective economic and financial rules in a manner consistent with the country's conditions of innovation and international integration
Financial management involves the use of financial management tools to accurately reflect the financial status of a unit, thereby allowing for the planning and management of financial resources to improve the unit's operational efficiency
Effective financial management requires management subjects to choose and make financial decisions and organize the implementation of those decisions to achieve the unit's financial management objectives Financial goals may change according to each period and strategic policy of each unit However, unlike business management, which mainly aims at optimizing profits, the goal of financial management in public service units is not for profit The primary aim is to serve the social community, which means financial management in these units is focused on managing and using state budget funding sources and other revenue sources effectively and in accordance with legal provisions
2.2.2 Financial management activities of public service units
2.2.2.1 According to the management cycle a Prepare Financial Estimates and Income and Expenditure Plans
Developing revenue estimates is a crucial step in the financial management cycle of public service units It must be based on several key factors:
1 Political and Social Tasks: These tasks are assigned to the unit, including specific targets for each aspect of activities announced by the competent authority (Dinh, 2021)
2 Current Legal Documents: These are prescribed by the State and provide a framework for financial planning and management (Government, 2006)
3 Inspection Reports: These are announced by the superior agency and provide critical insights for financial planning (Ministry of Health, 2010)
4 Historical Analysis: This involves analyzing the results of previous years' revenue estimates and considering the development direction for the following years (Nguyen, 2020)
Expenditure estimation is equally important as it determines the quality and effectiveness of budget execution, accounting, and finalization When preparing estimates, the following bases are essential:
State Policies: These policies on maintaining and developing public service activities guide the construction of expenditure estimates, ensuring that goals and tasks are aligned with the unit's objectives for the year (Tran, 2010)
Socio-economic Development Plan Targets: These targets are assigned by superiors and reflect the State's policies for each planning period Analyzing these targets correctly, realistically, and effectively helps in making accurate and practical expenditure estimates (Nguyen, 2020)
Funding capacity is essential for the government to meet its spending necessities Assessing this capacity involves examining the construction of state budget revenues and analyzing the growth rate of these sources (Dinh, 2021) This evaluation ensures that the funding capacity aligns with the planned spending requirements, helping to maintain a balanced financial plan.
Results from the analysis and assessment of state budget fund management and use provide invaluable insights for precise financial forecasting (Tran, 2010) This information can be utilized to effectively organize management and execution of budget estimates.
Revenue estimates are a fundamental basis for organizing revenue implementation During the collection process, units must ensure that collections are made from the correct subjects, collected in full, and comply with State regulations to secure sufficient revenue sources (Dinh, 2021)
Complying with state budget expenditure estimates is the second critical step in the state budget management cycle The process should be based on the following considerations:
Approved Spending Norms: These norms for each expenditure in the estimate are the most decisive basis for implementing state budget expenditure estimates (Government, 2006)
Funding Availability: The availability of funding sources for state budget needs in each reporting period is crucial Regular expenditures must align with the capacity to mobilize revenue sources Even when regular expenses are recorded in the estimate, spending may need to be cut if revenue is not guaranteed, to re-establish balance between state budget revenue and expenditure (Nguyen, 2020)
Current Spending Regime and Policies: These provide the legal framework for organizing the implementation of state budget expenditure estimates, as expenditures must be in line with the state's current policies and regimes (Ministry of Health, 2010) c Finalization of Financial Income and Expenditure
At the end of the annual reporting period, units synthesize and evaluate their compliance with the assigned revenue estimates This involves assessing implementation results, identifying outstanding problems, and drawing lessons learned in exploiting revenue sources and constructing estimates The units then organize submissions for the near future and report to higher management agencies (Dinh, 2021)
Finalization of state budget expenditure is the final step in the financial management cycle This process involves checking, reviewing, and adjusting the data reflected after a period of budget implementation It includes analyzing and evaluating the results of budget execution to draw necessary experience for the next period The following requirements must be met during the finalization process (Nguyen, 2020):
Timely Preparation of Financial Reports: Reports must be prepared on time for competent authorities to review according to regulations (Government, 2006)
Accuracy and Honesty: The content and data in the report must be accurate and honest The order of content in financial reports must comply with the content in the approved estimate and the State budget's table of contents as prescribed (Ministry of Health, 2010)
Balanced Final Settlement: Final settlement reports must not show a situation where final settlement expenses exceed revenues (Tran, 2010)
2.2.2.2 According to management content a Manage Revenue Sources
Financial management at public service units in the health sector
2.3.1 The role of medical service units in the market economy
Public health service units are pivotal in maintaining and enhancing public health standards in a market economy Their primary role in examining and treating diseases ensures better healthcare, leading to improved human resources By providing medical care, they enhance human capital, which translates to increased productivity and efficiency in socio-economic activities This improved workforce benefits businesses and the economy by reducing absenteeism and boosting output.
Moreover, public health units significantly contribute to improving the quality of life and enhancing social security across the entire population These units collaborate with the State to achieve comprehensive healthcare goals, particularly focusing on
18 medical examination and treatment activities for disadvantaged groups such as the poor and sponsored individuals (Dinh, 2021) This inclusive approach ensures that even the most vulnerable populations have access to essential healthcare services, which is vital for social stability and equity For example, programs targeting maternal and child health can dramatically reduce infant mortality rates and improve long-term health outcomes for future generations
Furthermore, public health units support private health units and other production and business service units in providing high-quality health services to the public This support can take various forms, including setting standards for healthcare practices, providing training and resources, and facilitating research and development in medical sciences (Government, 2006) By fostering a collaborative environment, public health units ensure that private health providers can deliver services that meet rigorous standards of care, thereby enhancing the overall healthcare infrastructure This collaboration is particularly evident during public health crises, where coordinated efforts between public and private entities are crucial for effective response and management
In addition, public health units play a critical role in public health education and preventive care They conduct campaigns and programs aimed at educating the public about health issues, promoting healthy lifestyles, and preventing diseases These efforts are essential for reducing the incidence of chronic diseases such as diabetes, heart disease, and cancer, which have significant economic and social implications Preventive care and health education not only improve individual health outcomes but also reduce the overall burden on the healthcare system, leading to cost savings and more efficient use of resources (World Health Organization, 2020)
Public health units also drive innovation in healthcare through research and development They engage in clinical trials, epidemiological studies, and health services research that generate new knowledge and technologies This research is often conducted in partnership with academic institutions, private industry, and international organizations, creating a dynamic environment for innovation The advancements in
19 medical technology and treatment protocols developed through this research are crucial for improving patient care and outcomes (Brown, 2019)
Public health units play a crucial role in disaster response and emergency preparedness by developing and executing plans for natural disasters, pandemics, and other public health emergencies These plans involve collaboration with other agencies, training healthcare providers, and securing necessary supplies By implementing effective emergency preparedness and response measures, public health units can minimize the impact of disasters on communities, preserve lives, and accelerate recovery (Centers for Disease Control and Prevention, 2018).
In conclusion, the role of public health service units in a market economy is comprehensive and vital They ensure the delivery of high-quality healthcare, contribute to social equity by serving disadvantaged populations, support the broader healthcare system, promote public health education and preventive care, drive innovation, and enhance emergency preparedness Through these multifaceted roles, public health units not only improve individual health outcomes but also strengthen the overall socio-economic fabric of society Collaboration between public health units, private health providers, and other sectors is crucial for creating a robust and resilient healthcare system that can adapt to changing needs and challenges
2.3.2 Characteristics of public service units in the health sector impact financial management
Taking care of people's health is one of the greatest and most important tasks, bringing common and long-term benefits to the entire society With the aim of building a sustainable and comprehensively developed socialist society, prioritizing people as the decisive factor, it is essential to integrate medical activities into the broader societal agenda (Tran, 2010)
Medical activities are an indispensable part of human society People consistently need to care for their health and the health of their families due to frequent changes in the living environment and the natural world Medical activities are designed to
20 mitigate the negative impacts of the living environment on humans Each country, in its economic and social development process, must focus on human healthcare as a foundation for guiding other socio-economic programs towards sustainable development (Ministry of Health, 2010)
The advancement of modern science and technology today caters to diverse human needs, and improving the quality of the health sector requires financial investment Investment capital for health can come from various sources, but in our country, it is primarily covered by the state budget, forming state budget expenditure for the health sector This expenditure impacts the organization of the health network and structure, making appropriate arrangements and guiding the effective management of health activities (Nguyen, 2020)
Public service units in the health sector, despite their different scales of operation, share common characteristics:
State-Established and Non-Profit Operation: These units are established by the State and operate on the principle of providing public services, not for profit The State organizes, maintains, and sponsors the activities of these units to offer society special products and services that support normal economic activities, enhance people's knowledge, foster talents, ensure human resources, and promote economic development (Dinh, 2021)
Public Benefits and Sustainable Impact: The products of public service units in the health sector bring common benefits that are sustainable and linked to the process of creating material wealth Medical activities provide public goods, delivering health, knowledge, and essential understanding that contribute to the comprehensive development of people, which is crucial for the country's socio-economic development (Government, 2006)
Integration with Socio-Economic Programs: The activities of public service units in the health sector are connected to and influenced by socio-economic development programs, such as community health programs and disease prevention initiatives (Ministry of Health, 2010)
RESEARCH METHODS
Research Methods
3.1.1 The method of data collection
The secondary data collection method involves gathering information from various existing sources This method is crucial for understanding the context and existing conditions of the research topic The sources include:
- Legal documents, decrees, circulars, and decisions of the State
- Circulars, decisions, and guidance documents from the Ministry of Health and Social Insurance
- Decisions, regulations, and guidelines from the Central Institute of Hematology and Blood Transfusion
- Data from financial settlement reports, summary reports, and accounting books at the hospital over the years
The objective of this method is to collect comprehensive and relevant data to provide a solid foundation for analysis and evaluation
3.1.1.2 Collect data at the Central Institute of Hematology and Blood Transfusion
This section details the specific documents and data sources collected from the Central Institute of Hematology and Blood Transfusion The aim is to gather comprehensive information to analyze and evaluate the financial management practices at the Institute Below are the key sources of data and their relevance:
Decree 43/2006/ND-CP and Decision No 19/2006/QD-BTC on Accounting Regime for Administrative and Public Service Units: These documents provide the framework for financial and accounting practices in administrative and public service units Decree 43 outlines the autonomy and self-responsibility in performing tasks, organizing payroll, and managing finances for public service units, including those in the healthcare sector Decision No 19 details the accounting standards and practices that must be adhered to, ensuring consistency and transparency in financial reporting
Financial and Accounting Regime Applicable to Administrative and Public Service Units Issued Under Circular 107/2022/TT-BTC Dated October 10, 2022: Circular 107/2022/TT-BTC updates and clarifies the financial and accounting regulations for public service units This document is crucial as it provides the latest guidelines on financial management, ensuring that the units comply with current legal and financial standards It includes details on budget preparation, expenditure management, and financial reporting, which are essential for accurate financial analysis
Decree 85/2012/ND-CP Dated October 15, 2012, on Financial Mechanisms for Public Health Service Units and Prices of Medical Examination and Treatment Services: This decree specifies the financial mechanisms applicable to public health service units, including how they can generate and use funds It also provides guidelines on setting prices for medical examination and treatment services, which directly impact the revenue of public hospitals Understanding this decree helps in analyzing how financial policies influence hospital operations and financial health
Decree 60/2021/ND-CP Dated June 21, 2021, on Regulations on Financial Autonomy Mechanism of Public Service Units: Decree 60 introduces regulations that enhance the financial autonomy of public service units It allows these units greater flexibility in managing their finances, encouraging efficiency and accountability This decree is essential for understanding the current financial autonomy practices at the Central Institute of Hematology and Blood Transfusion and how it affects their financial management strategies
Financial Reports of the Central Institute of Hematology and Blood Transfusion from 2020 to 2022 provide insights into the Institute's financial performance and trends over three years These comprehensive reports include income statements, balance sheets, and cash flow statements, enabling stakeholders to analyze financial management practices and identify areas of strength and improvement.
Report on Human Resources and Professional Work of the Central Institute of Hematology and Blood Transfusion: This report provides information on the staffing and professional activities at the Institute It includes data on staff qualifications,
37 staffing levels, and the distribution of professional roles This information is crucial for assessing the impact of financial management on operational efficiency and staff productivity
The goal of collecting and synthesizing these documents is to provide a comprehensive overview of the financial management practices at the Central Institute of Hematology and Blood Transfusion By analyzing the collected information, the author aims to evaluate the current state of financial management and identify areas for improvement This analysis will inform recommendations for enhancing financial management and achieving greater financial autonomy and efficiency at the Institute
The information analysis method involves a systematic approach to evaluate and interpret the data collected from various financial documents The primary tool used for this analysis is Microsoft Excel, which offers robust capabilities for data manipulation, visualization, and comparison
Microsoft Excel is utilized to analyze and evaluate data collected from financial settlement reports, summary reports, and accounting books of the Institute The software's features, such as pivot tables, charts, and statistical functions, facilitate detailed analysis and clear presentation of financial data Excel enables the organization of large datasets, calculation of key financial metrics, and visualization of trends over time, making it an essential tool for this research
The comparison method is a straightforward yet powerful technique used to examine trends and variations in specific financial indicators This method is particularly suitable for analyzing secondary data collected over time, allowing for the assessment of fluctuations and patterns The comparison involves:
Relative Numbers and Absolute Numbers: Studying both relative and absolute changes in values to understand the magnitude and proportion of variations
Increases and Decreases in Values: Identifying and quantifying the increases and decreases in financial metrics over different periods
Compare Current Period Performance with Previous Period: This comparison helps to identify whether the financial performance has improved or deteriorated over time It provides insights into areas that require remedial measures in the next period
Compare Current Performance with Plan: This step assesses how well the unit has met its planned financial targets It highlights the level of effort and efficiency of the unit in achieving its goals
By expressing these comparisons in amounts or percentages, the analysis provides a clear view of financial performance, enabling the formulation of scientifically based conclusions
The statistical and synthesis method involves compiling and synthesizing collected information and data to create a comprehensive overview for the research topic This method includes:
Compilation of Data: Gathering all relevant financial information from various sources, including financial reports, summary reports, and accounting books
Synthesis of Data: Integrating the compiled data to identify patterns, correlations, and key insights that are pertinent to the research objectives
Through the combined use of comparison and statistical methods, the analysis aims to:
Evaluate Financial Activities: Assess the effectiveness of financial management practices at the Central Institute of Hematology and Blood Transfusion
Propose Solutions: Develop recommendations to improve financial management towards greater autonomy and efficiency
The overall goal is to enhance the financial management system at the Institute, ensuring it can operate more effectively and sustainably This analysis will support the Institute in achieving its financial and operational objectives, ultimately leading to improved service delivery and resource management
Research indicator system
Effective financial management in public hospitals involves employing fair and lawful methods to allocate and mobilize financial resources It also entails ensuring appropriate and sufficient expenditures that align with the hospital's financial capabilities These measures are crucial for maintaining the quality of medical services and meeting the healthcare needs of the public.
Financial Indicators for Evaluating Revenue
To evaluate the Institute's revenue, the following financial indicators are commonly used:
Rate of increase and decrease in revenue compared to previous years:
This indicator measures the percentage change in total revenue from one year to the next It helps in understanding the growth or decline in the Institute's financial performance over time By analyzing this rate, the Institute can identify trends and assess whether revenue generation strategies are effective
Ratio of state budget to revenue:
This ratio indicates the proportion of the Institute's total revenue that comes from state budget allocations This ratio is crucial for understanding the dependence of the Institute on state funding A lower ratio may indicate greater financial autonomy, while a higher ratio suggests significant reliance on state support
Rate of increase and decrease in hospital fee collection compared to previous years:
This indicator measures the percentage change in revenue generated from hospital fees from one year to the next By tracking this rate, the Institute can evaluate the effectiveness of its pricing strategies and patient service offerings
These financial indicators provide a comprehensive view of the Institute's revenue performance By regularly monitoring these metrics, the Institute can make informed decisions to enhance financial management, optimize resource allocation, and ensure the sustainability of its operations Effective use of these indicators will
40 help maintain financial stability while continuing to deliver high-quality medical services to the public
CURRENT SITUATION ENHANCEMENTS TO FINANCIAL
Overview of the activities of the Central Institute of Hematology and Blood
4.1.1 History of formation and development
Full name in Vietnamese: Central Institute of Hematology and Blood
International transaction name: National Institute of Heamatology and Blood Transfusion
Full name in Vietnamese: Central Institute of Hematology and Blood
National Institute of Heamatology and Blood Transfusion
Website: https://www.nihbt.org.vn
Address: Pham Van Bach Street, Cau Giay District, Hanoi City
The Central Institute of Hematology and Blood Transfusion was established on March 8, 2004, according to Decision No 31/2004/QD-TTg by the Prime Minister The Institute's predecessor was the Institute of Hematology and Blood Transfusion under Bach Mai Hospital, which was established on December 31, 1984, according to Decision No 1531/BYT-QD by the Ministry of Health, based on the Department of Hematology - Blood Transfusion and Diseases at Bach Mai Institute
The Institute's functions and tasks were approved by the Ministry of Health in Decision No 1261/QD-BYT, dated April 9, 2004 This decision promulgated the Charter on the organization and operation of the Central Institute of Hematology and Transfusion Medicine The Central Institute of Hematology and Blood Transfusion operates under the Ministry of Health It is a member of the Youth Union that covers
42 part of its operating costs and is assigned autonomy and responsibility for implementing organizational, staffing, and financial tasks according to Decision No 5201/QD-BYT dated December 27, 2010, of the Minister of Health, as well as Decree 43/2006/ND-CP and Decision No 19/2006/QD-BTC, which outline the accounting regime for administrative and public service units
After 30 years of construction and development, the Central Institute of Hematology and Blood Transfusion has achieved numerous significant accomplishments, contributing greatly to the cause of public health care It has become a leading specialized institute, reaching both regional and international standards
The Institute leads in advancing medicine through innovative testing and stem cell transplant expertise, having performed nearly 200 transplants as of 2022 It continuously improves its medical processes to enhance patient experiences The Institute's commitment to staff morale and service quality has resulted in a significant increase in patient visits, with 109,071 outpatient visits and 22,472 inpatient visits in 2022 Its superior treatment outcomes and affordable costs, less than 50% of those abroad, have attracted patients who previously considered seeking care internationally.
In the field of blood transfusion, the Institute has initiated and organized numerous large-scale blood donation events with significant impact, attracting a vast number of participants Notable events include the "Pink Spring Festival" and the "Red Journey" program In 2022 alone, the Institute collected 251,632 units of blood, an increase of 6.77 times compared to 2005 The proportion of voluntary blood donations increased from 32% in 2004 to 98.28% in 2022, essentially ensuring a sufficient blood supply for emergencies, treatments, and disaster response
Additionally, the Institute excels in executing programs, projects, foreign affairs, training, scientific research, and organizing national and international
43 conferences and seminars These efforts have significantly bolstered its reputation and operational effectiveness
The Institute's exceptional contributions to public health and medical advancements have garnered it prestigious accolades These include First, Second, and Third Class Labor Medals bestowed by the Party and State Moreover, the Institute has received numerous Certificates of Merit from the Prime Minister, the Ministry of Health, and various government entities, acknowledging its profound impact on the healthcare landscape.
4.1.2 Functions and tasks of the Institute
The Central Institute of Hematology and Blood Transfusion is tasked with a range of vital functions It is responsible for examining and treating specialized diseases related to hematology and blood transfusion The Institute also produces blood products and manages the entire process of blood collection, screening, and supply It engages in scientific research and provides training, guiding, directing, and inspecting professional expertise across the nationwide hematology and blood transfusion system Additionally, the Institute plays a crucial role in fostering international cooperation in hematology and blood transfusion, adhering to the legal provisions set forth by Decision No 31/2004/QD-TTg, dated March 8, 2004, by the Government
The specific tasks and powers of the Central Institute of Hematology and Blood Transfusion are detailed in Decision No 1261/QD-BYT, dated April 9, 2004, issued by the Minister of Health These include:
Examination, First Aid, and Treatment of Diseases of the Blood and Hematopoietic Organs: The Institute is responsible for receiving and treating patients with diseases related to hematology and blood transfusion This includes conducting health examinations and forensic examinations as requested by competent agencies The Institute utilizes its specialized resources to provide comprehensive care for these patients
Collect, Screen, Produce, and Supply Blood and Blood Products: The Institute
44 coordinates with organizations such as the Red Cross and Vietnam Youth Union to mobilize voluntary blood donations, ensuring a safe and sufficient blood supply It manages clinical screenings to ensure donor safety and maintains a safe donor pool The Institute organizes blood collection sites, ensures the thorough screening of blood units, and produces various blood components—such as red blood cells, white blood cells, platelets, and plasma—meeting European standards These components are preserved and distributed for emergency and treatment needs across hospitals
Research and Application of Hematology and Blood Transfusion Science: The Institute conducts extensive research to improve the diagnosis and treatment of blood diseases and hematopoietic organs It develops scientific research initiatives, selects and applies advanced techniques suitable for Vietnam, and disseminates these advancements nationwide The Institute is also involved in researching and producing biological products and aims to establish a national standard laboratory for hematology and blood transfusion
Training Staff Specializing in Hematology and Blood Transfusion Nationwide: The Institute serves as a key training base, educating medical staff at various levels It provides additional training for specialists and technicians and participates in compiling specialized documents in hematology and blood transfusion This ensures a well-trained workforce capable of meeting the country's healthcare needs in this specialized field
Directing the Hematology and Blood Transfusion Department Nationwide: The Institute advises the Ministry of Health on development strategies, policies, and standards related to staff, equipment, techniques, and network organization It supervises the implementation of professional processes and standards at lower-level facilities and monitors blood transfusion safety guidelines, ensuring nationwide consistency and safety
International Cooperation in the Fields of Hematology and Blood Transfusion: The Institute maintains cooperative relationships with countries and organizations worldwide, focusing on key issues in hematology and blood transfusion It sends staff for international training, conferences, and scientific seminars, strengthens research cooperation, and participates in international and regional organizations within the
45 field This global collaboration enhances the Institute’s capabilities and knowledge base
Assessing the current state of financial management at the National Institute
of Hematology and Blood Transfusion
In recent years, financial management at the Central Institute of Hematology and Blood Transfusion has made many efforts to improve the quality of financial management and management in accordance with the law The Institute has achieved results in financial management as follows:
The Institute's budget estimation adhered to appropriate calculation methods, ensuring its accuracy and alignment with actual circumstances The resulting budget effectively reflects available financial resources, facilitating efficient financial management Throughout the budget year, the funding allocated from the state budget was fully utilized.
Over the years, revenue has tended to increase, especially revenue from non- business activities The policy of granting autonomy has helped the institute be proactive and active in exploiting revenue sources, especially expanding medical services, so revenue results next year increase compared to the previous year, non-stop revenue sources This increase creates favorable conditions for the institute in ensuring increasing spending needs The management of non-state budget financial sources in recent times has had many positive changes Understanding non-state budget revenue sources has helped the institute be more proactive in spending, contributing to increasing income and improving quality income for civil servants
Funding sources are used effectively and economically, increasing income and ensuring benefits for officials and employees: Due to being given autonomy and self- responsibility in using the state budget and revenue sources, the institute has been proactive Use financial resources for professional activities, appropriately use expenses in assigned budget calculations and revenues, avoid excess or shortage of funds between groups of expenditure items Since becoming financially independent, the Institute's revenue has increased and it operates more effectively, so the income of officials and employees has improved significantly In fact, the annual increase in income during the period 2020-2022 has been maintained at 0.86 times to 1.18 times compared to the total salary fund
Regarding expenditure content management: The Central Institute of Hematology and Blood Transfusion has developed annual internal expenditure regulations to manage financial revenues and expenditures scientifically , for the right purpose, and in accordance with financial capacity unit main Some contents specified in the internal spending regulations have contributed to cost savings such as: Stationery, communications, conferences, per diem, staff training, etc
Decree 43/2006-ND-CP, Decree 85/2012/ND-CP, and Circular 71/2006/TT-BTC provide guidelines for the appropriation of funds to enhance the implementation of policies for staff, increase investment in construction, and procure equipment to support healthcare services and improve the well-being of the population.
Regarding financial disclosure: Annual financial work has a written public report and is approved in the annual conference of officials and employees At the staff conference and key staff meeting, the representative of the Finance and Accounting Department, on behalf of the institute's leadership, announced the institute's revenue source The financial expenditures are carried out according to plan, the 6-month summary and the year-end summary are notified to all officials and employees The hospital's expenses are all made in accordance with regulations, payment of hospital fees and medical services are invoiced according to regulations of the Ministry of Finance All revenues and expenditures have full signature and name of the payer and
73 are public and transparent Salaries, bonuses, direct payments are guaranteed to be spent correctly, fully and on time regulations
These results have been achieved due to several key factors:
Firstly, the Institute's Party Committee is a strong, united body that demonstrates comprehensive, centralized, and democratic leadership The leadership at the Institute consistently shows creativity and high consensus in setting operational targets and implementing measures appropriate to the Institute's actual situation
The implementation of Government Decree 43 over several years, with the high consensus of all officials and employees, has created a new, autonomous mechanism in many aspects, contributing significantly to the development of the Institute
The Board of Directors has actively promoted and rigorously implemented democratic regulations in all activities of the Institute This is reflected in policy plans for recruitment, training, financial management, and internal spending regulations
The Central Institute of Hematology and Blood Transfusion's financial management is coordinated by the Finance and Accounting Department, which implements a revenue and expenditure policy This department, under the Director's direct supervision, provides financial planning, budget management, and guidance for maximizing revenue and minimizing expenses Additionally, it follows directives from superior agencies and supports the Institute's leadership in making financial decisions.
The internal spending regulations are based on Decree No 43/2006/ND-CP dated April 25, 2006, which regulates the right to autonomy, self-responsibility for performing tasks, organizational structure, payroll, and finance for public service units These regulations are also based on Circular No 71/2006/TT-BTC dated August 9,
2006, from the Ministry of Finance, guiding the implementation of Decree No 43
The Central Institute of Hematology and Blood Transfusion has developed and promulgated internal spending regulations based on the budget conditions of the Ministry of Health and the Institute's revenue sources These regulations allow expenditures to meet the Institute's needs while ensuring compliance with State
The Institute's financial autonomy is maintained through comprehensive internal spending regulations that are updated annually These regulations govern expenditures such as salaries, allowances, management expenses, stationery, and fund appropriations Moreover, the Institute aligns its spending with current state regulations, enabling it to comply with financial best practices and ensure responsible resource allocation.
Financial inspection and audit work at the Institute is conducted regularly and irregularly Regular inspections include the establishment of a people's inspection board tasked with inspecting all aspects of the Institute's activities, including periodic internal financial inspections The State Treasury controls all financial revenue and expenditure activities originating from the state budget through the Institute's internal spending regulations Each year, the Ministry of Health directly inspects, appraises, and approves the Institute's financial settlements Furthermore, the State mandates financial disclosure, public allocation, and use of the annual state budget according to Decision No 192/QD-TTg of the Prime Minister, which helps the Institute maintain transparency and accountability
Development Orientation and Financial Autonomy Goal at the National
4.4.1 General Direction of the Health Sector
Health is the most valuable asset of each person and society Protecting, caring for, and improving people's health is a humanitarian activity that directly ensures human resources for building and defending the nation, making it one of the Party and State's top priorities Investment in this field is an investment in development, demonstrating the regime's good nature
Socio-economic development provides a solid foundation for community health care, which in turn positively contributes to sustainable socio-economic development Investing in health care is essential and acts as a driving force in the socio-economic
78 development process Public health services provided by the State are special social services, not for profit, making investment in health an investment for development
Innovating and improving Vietnam's healthcare system towards equity, efficiency, and development creates favorable opportunities for everyone to be protected, cared for, and receive high-quality health services This is especially crucial for the poor, ethnic minorities, children under six years old, policy beneficiaries, and people in disadvantaged, remote, border, and island areas The fairness of the health system stems from fair legal documents in the health sector, considering community health care as a value and a mission linked to socio-economic development This ensures that each community member benefits from socio-economic development, aligning with the goal of the development process
An effective and developed health system results from a healthy, equitable, and sustainable socio-economic development process This includes regulatory documents, policies, and laws that balance the needs of different populations and prioritize the benefits of future generations The State plays a leading role in macro-management, guiding the development of health care through legal and policy frameworks, resource allocation, quality management of medical services, and pricing
Harmonizing the strengthening of the grassroots medical network with the development of specialized healthcare, the balance between public and non-public healthcare, and the integration of modern and traditional medicine are key strategies Encouraging non-state economic sectors to participate in providing health services mobilizes multiple capital sources, eases state budget pressure, and fosters healthy competition, improving service quality
Developing medical human resources, particularly in underserved regions, is paramount for healthcare effectiveness The strategy emphasizes fostering highly skilled doctors, expanding nurse training, and optimizing the ratio of medical professionals To enhance operations, the sector requires innovative mechanisms, increased public investment, universal health insurance, and efficient resource allocation.
4.4.2 Development Orientation of the National Institute of Hematology and Blood Transfusion
The Institute aims to promote and maintain internal solidarity while implementing centralized and democratic regulations It continuously strives to improve medical examination and treatment, training, scientific research, and international cooperation towards building a leading specialty comparable to regional and global standards
The Institute's strategic goals include advancing professional, technical, scientific, and technological activities to reach advanced levels in the region Ensuring the Institute's human resources are properly staffed and preparing qualified key staff are priorities Continuous improvement in the quality of staff through recruitment, training, and skill enhancement, including foreign language proficiency, is emphasized
The Institute aims to develop its professional and specialized services to increase legitimate revenue sources, complying with State regulations This will further improve the material and spiritual life of all staff members Additionally, securing funding sources to pay interest on loans for timely institute construction is crucial
Promoting programs, projects, and scientific research at all levels, as well as strengthening international cooperation to develop specialized fields, expand relationships, and enhance integration, is essential The Institute plans to advise relevant levels and branches on organizing the Central Institute of Hematology and Blood Transfusion in the coming period, potentially separating into units like the National Hematology Hospital and the National Blood Transfusion Center Reorganizing Vietnam's Hematology - Blood Transfusion system to ensure compatibility and international integration, separating Hematology from Blood Transfusion, and centralizing the blood transfusion system will improve the network's effectiveness, especially in remote, border, and island areas
By 2027, the Institute aims to transition to a university covering its operating costs, contingent on the Ministry of Health adjusting medical service prices to include salaries.
Complete solution for financial management at the National Institute of
4.5.1 Completing the Estimation and Development of Financial Plans
Estimating revenue and expenditure is the foundation of financial planning in the unit Financial activities at the Central Institute of Hematology and Blood Transfusion come from multiple sources, not only the state budget Therefore, financial planning must fully reflect these financial sources and expenditures Creating a detailed financial plan helps organize and carry out the work smoothly and provides a basis for evaluating the implementation of the financial plan The work of building a financial plan in the coming time needs to include the following:
The annual financial operating plan must be shown in the unit's revenue and expenditure estimates These estimates need to be well-founded and close to reality Making financial estimates should be considered an important activity in the management of all units in the institute and requires cooperation and participation from many departments, faculties, rooms, and centers within the institute (Nguyen, 2020)
A financial plan for the necessary revenue sources should be made for each revenue source, based on calculations and methods for determining these sources, to provide a basis for monitoring and managing revenue
For regular expenses, a detailed plan for each expense should be made Building a financial plan for regular expenses must determine the institute's spending structure so that the plan can truly be a financial management tool (Tran, 2019)
Strengthening revenue management requires implementing solutions for both state budget sources and non-state budget sources
State budget revenue: Although regular funding from the annual state budget has a low and decreasing proportion in the institute's total revenue, it remains a relatively stable source The Institute should leverage its strengths as a leading institute and the State's key investment in Hematology and Blood Transfusion, enlisting departmental support to maximize the use of budget resources (Le, 2018)
Sources of revenue outside the state budget: Implementing the collection of medical service prices according to the principle of calculating all costs, expanding the types of medical examination and treatment upon request with high fees commensurate with the quality that users enjoy The institute's current operating budget mainly comes from two main revenue sources: state budget sources and non- state budget sources, with the latter playing a key role and accounting for a large proportion of the institute's total revenue To maintain, enhance, and diversify revenue sources, the institute needs to consider and implement the following solutions (Pham, 2021):
With societal and economic progress, the incidence of blood disorders has increased in Vietnam, leading to an influx of patients seeking medical attention This surge in demand has strained hospital resources, creating a need for on-demand medical services to address the diverse healthcare needs of the public and alleviate the burden on healthcare institutions.
Besides direct medical examination and treatment at the hospital, expanding other forms of medical examination and treatment, such as consulting on blood diseases by phone and establishing a family doctor's clinic, sending doctors to patients' homes for comprehensive care, is beneficial (Nguyen, 2020)
Expanding the service of taking test samples and returning results at home is becoming a trend, especially for modern families This service provides psychological comfort to patients, eliminating waiting times and concerns, particularly for the elderly, children, or busy individuals (Pham, 2021)
Implementing contract management in some departments within the institute Determining the planned level based on the funding allocated to each department will
82 help reduce the management burden and focus on in-depth resource management Effective contract management ensures the proper use of funds and prevents revenue loss, with contracting units required to have plans to increase revenue and save expenses (Le, 2018)
4.5.3 Strengthen management and reasonable use of expenses
To maintain and develop sustainably, in addition to paying attention to the issue of creation, the institute needs to pay attention to the issue of using financial resources in the most effective way, bringing the highest benefits to the institute The effectiveness of expense management is reflected in the amount of money saved when performing assigned tasks, so it must be calculated so that with the lowest cost but the highest efficiency To improve the efficiency of expenditure use, the following solutions are needed:
Develop an institute development plan for each specific period The development of an institute development plan for each specific period must be carried out in the short term, once a year after the end of the budget year, and in the medium term every 5 years as well as with a long-term vision in the future The next 10 years With the continuous development in the medical industry, more and more modern techniques are being applied, so the institute needs to develop a development plan to suit each specific period and supplement, amend the plan to suit reality (Nguyen, 2011)
Arrange the unit's apparatus appropriately in a streamlined and compact manner to ensure cost savings Implementing financial autonomy requires eliminating the payroll quota applied to the unit because it cannot attract a young workforce with well- trained qualifications due to lack of payroll In addition, even though officials who have been on the payroll do very poorly and have low work efficiency, it is very difficult to get them off the payroll, leading to low work efficiency, increased spending, and no motivation for development institute's sustainability
Regularly propagate and mobilize officials and employees to practice thrift and combat waste, contributing to savings for the institute To improve the spirit of saving and combat waste, the institute needs to develop specific norms for units because
Currently, the institute lacks established guidelines for the appropriate utilization of consumables Recognizing this deficiency, the institute aims to develop standardized norms for various units, ensuring alignment with user requirements This initiative is crucial for optimizing resource allocation and ensuring the effective use of consumables within the organization.
4.5.4 Strengthen accounting and internal inspection
CONCLUSION
Recommendations
5.1.1 Recommendations to the Ministry of Health
It is necessary to refine the legal document system to enhance the role of state management in hospital management By updating and improving the legal frameworks, hospitals can have clearer guidelines and regulations, which can help in better administration and governance Additionally, based on existing regulatory documents, the Ministry should consider organizing accounting training courses to empower hospitals in accounting organization and financial management These training sessions will ensure that hospital staff are well-versed in financial regulations and management practices, thereby improving overall financial efficiency and accountability
Moreover, the Ministry of Health should collaborate with the Ministry of Finance and the Vietnam Social Insurance to establish healthcare service pricing frameworks in accordance with the roadmap outlined in Decree 85/2012/ND-CP This collaboration is essential to develop a fair and transparent pricing system for medical services, which will help in aligning the costs with the actual services provided
Developing standardized treatment protocols is also crucial These protocols will help assess the rational use of diagnostic tests, medical equipment, and medications in hospitals, as well as evaluate the quality of healthcare services This step is significant for maintaining high standards of care and ensuring that resources are used effectively and efficiently
Furthermore, it is important to enhance monitoring and supervision of hospital autonomy implementation in accordance with relevant legal documents This is particularly important regarding the investment in medical equipment following the socialization method outlined in Circular No 15/2007/ND-CP By improving oversight, the Ministry can ensure that hospitals adhere to the set guidelines and that the investments made are beneficial to the healthcare system (Ministry of Health, 2010; Government, 2012)
Enhancing legal documents related to financial management in public sector entities is crucial The state should refine and supplement the legal document system concerning the implementation of Decree 43/2006/ND-CP and Decree 16/2022/ND-
CP to create a comprehensive legal environment This will enable entities to actively manage and efficiently utilize resources For specialized sectors like healthcare, specific decrees should be issued to accommodate the peculiarities of entities within the sector Given the diverse forms of healthcare services, including demand-driven healthcare, specific guidelines on financial management tailored to these forms are necessary
Moreover, clear provisions on special taxes for healthcare enterprises when implementing autonomy are also required Innovating hospital financial mechanisms from the perspective of the entire healthcare system, hospitals, and especially the interests of the people is essential This approach ensures that financial autonomy does not compromise the quality of healthcare services and that the needs of the population are met adequately By adopting a holistic view of financial management in hospitals, the state can ensure that resources are allocated efficiently and that hospitals can sustain their operations while providing high-quality care to patients (Nguyen, 2020; Mai, 2023).
Conclusion
While hospitals have made progress, systemic healthcare concerns require attention from the healthcare system, hospitals, and particularly the needs of low-income individuals Viewing the system solely through the lens of hospitals compromises overall healthcare goals The concerning trend of rising public hospital revenues undermines equity and public interests To address this, comprehensive health insurance must be prioritized, transitioning to universal coverage Fee-for-service payment structures should be phased out in favor of capitation and per-case payment models to ensure quality healthcare delivery.
Ensuring healthcare for the people is an essential need and plays a crucial role in socio-economic development Healthcare services are increasingly diverse and developed, both in quantity and quality, to meet current societal needs However, the state is tasked with implementing many other socio-economic objectives to ensure social justice and economic development, which leads to limited state budget allocations for the healthcare sector Therefore, implementing financial autonomy in public healthcare entities is a sensible direction aligned with the country's socialist- oriented market economy development pathway
Financial management for public healthcare entities is a critical aspect of their development process Only through effective financial management can these entities achieve sustainable and efficient development
Within the scope of the thesis and the author's capabilities, despite considerable effort, the thesis unavoidably contains some shortcomings in content and research methodology The author respectfully seeks feedback and guidance from the Scientific Council, professors, and colleagues to help improve and refine the thesis
1 Ministry of Health (2010), Survey report on the implementation of Decree 43/2006/ND-CP in the public hospital system Hanoi
2 Government (2006), Decree No 43/2006/ND-CP dated April 25, 2006 regulating autonomy and self-responsibility for performing tasks, organizational structure, payroll and finance for units public career
3 Government (2012), Decree No 85/2012/ND-CP dated October 15, 2012 regulating operating and financial mechanisms for public service units and prices of medical examination services, medical treatment at public medical examination and treatment establishments
4 Ministry of Finance (2006), Circular No 71/2006/TT-BTC dated August 9,
2006 guiding the implementation of Decree No 43/2006/ND-CP dated April
25, 2006 of the Government regulating the right to freedom Owner, self- responsible for performing tasks, organizational structure, payroll and finances for public service units
5 Dinh Thi Kim Oanh (2021) "Improving the financial autonomy mechanism at Phu Tho Provincial General Hospital" Master's thesis in economics, University of Agriculture, Hanoi
6 Nguyen Thi Kim Chuc (2011), Health economics and health insurance
7 Nguyen Thi Phuong Hieu (2020) "Improving the financial autonomy mechanism at Viet Duc Hospital" Master's thesis in economics from the Academy of Social Sciences
8 11th National Assembly (2002 ), State Budget Law, Law No.: 01/2002/QH11
9 Tran Thi My Hang (2010) ― Financial management at Cu Chi Regional General Hospital, Master's thesis in economics, University of Economics, Ho Chi Minh
10 Central Institute of Hematology and Blood Transfusion (2020), 2020 Financial Report
11 Central Institute of Hematology and Blood Transfusion (2021), 2021 Financial Report.