The report is divided into five chapters. European Observatory on Health Systems and Policies; 2014. Government funds are mainly allocated through historical incremental approach. To understand the components of a health system. Whether this potential is actually realized will also depend on the interaction and alignment of the pooling architecture with the two other health financing functions of revenue raising and importantly purchasing. there must be a specific contribution made by or on behalf of the covered person. This is inconsistent with the objective of financial protection and equity of access to services in relation to need. Reforms in the pooling of funds. They also contribute to system-wide inefficiencies arising from the duplication of responsibilities for managing different pools (with purchasingoften linked to that). Geneva: World Health Organization; 2016. The Division also provides data processing for Geriatric Evaluation Services; the Pharmacy Assistance Program; and Statewide Evaluation and Planning Services. These latter three were replaced by a new health coverage scheme that was introduced in 2002, called the Universal Coverage Scheme (UCS), as a response to growing concerns about the huge differences in level of funding per capita across the schemes and the remaining coverage gap due to the failure of the voluntary insurance to reach much of the informal sector. In some cases, this is limited to civil servants only. 0000007449 00000 n
The three key functions of a health financing system-resource mobilization, pooling, and purchasing-are described in Figure 1. Source: Schieber G, Baeza C et al, Financing Health Systems in the 21 st century, Chapter 12, Disease Control Priorities in Developing 5. to (5.) 0000035307 00000 n
Some countries, such as Rwanda and Ghana, have transformed their earlier CBHI model, which no longer falls under VHI. 154 0 obj <>
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kem ZG, akar M. What have health care reforms achieved in Turkey? Even in countries with highly centralized pooling, there are usually several pools of funds that are used to pay for some health services, for example occupational health programs, supply-side funding for other government services such as those delivered through vertical programs or voluntary health insurance [1]. Washington DC: World Bank; 2004. 5. 2007;83(23):16279. Three key health financing system functions Resource Mobilization: Policy note. Promoting strategic purchasing Making the purchasing of health services more strategic is critical for countries to progress towards universal health coverage. Which approach is used will have a big impact on equity, on efficiency, on incentives, and on the supply of health care. Strategic purchasing for universal health coverage: key policy issues and questions. FDA Staff Manual Guides, Volume I - Organizations and Functions . Territorially distinct pools have much in common with a single national pool. %PDF-1.5
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Akerlof GA. From a system point of view, there are benefits to this arrangement because these forms of VHI can fill explicit gaps in publicly funded coverage. Key facts Purchasing to improve health system performance. Article <]>>
Voluntary health insurance (VHI) with a primary coverage role is usually offered by multiple insurers competing for clients. and (7.) 0000002097 00000 n
When pooling also follows the countrys administrative structure, the mandates for service coverage (and hence population coverage) of different government level pools may overlap, thus creating an additional layer of fragmentation. Such a pool provides compulsory or automatic coverage for the entire population, usually for a defined package of services. Health Policy. Pools can be based on compulsory, automaticor voluntary participation. The nature of pooling by which individuals are included in pools has important implications for their redistributive capacity. [http://www.internationalhealthpartnership.net//CMS_files/documents/working_group_2_report:_raising_and_channeling_funds_EN.pdf, accessed 6 July 2010)]. Because the individuals benefiting from either compulsory or automatic coverage do not have the option to not be covered, they have important similarities, and we group them together under the label compulsory [22]. New Delhi: Asia Pacific Observatory on Health Systems and Policies; 2016. !{~4nf0QMh92]Ta, *eIF arrange the three key health financing functions of revenue col-lection, risk pooling, and purchasing. Here the pooling function lies with a sub-national entity, such as a state, province, or district (if managed by a level of public administration) or another entity, such as a health insurance fund, with defined responsibility for the entire population of that territory [14]. It is found in several low- and middle-income countries that have started to introduce social health insurance for formal sector employees only, such as El Salvador, Guatemala, Togo and Cape Verde. endstream
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Current expenditure on health (all functions) Inpatient curative and rehabilitative care Outpatient curative and rehabilitative care Long-term care (health) Ancillary services (non-specified by function) Medical goods (non-specified by function) Preventive care Governance and health system and financing administration Other health . Book The health financing system in the country is complex as it involves different layers of financial sources, . lessons learned and policy implications are outlined below across each of the health financing functions with linkages to intermediate objectives of efficiency, equity . Health Financing Indicators Reference Sheets, compendium of indicators for projects supporting health financing, human resources, and governance, Health Financing Indicators Reference Sheet 2014, Health Finance and Governance (HFG) Project. Raising and channeling funds: Working Group 2 report, 2009. 0000008166 00000 n
The indicators cover the following areas: The World Health Organization defines a well-functioning health financing system as one that raises adequate funds for health in ways that ensure people can use needed services and are protected from financial catastrophe or impoverishment associated with having to pay for them. The investments that competing insurers make to try and select preferred risks (or avoid high health risks) are inefficient from a social welfare perspective [11, 26], because the resources devoted to risk selection do not contribute to progress towards UHC, and in fact may detract from it.
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. Alhassan RK, Nketiah-Amponsah E, Arhinful DK. Bonilla-Chacn ME, Aguilera N. The Mexican Social Protection System in Health [Universal Health Coverage Studies Series (UNICO) No. Smith P. The role of markets and competition. World Health Organization. The purpose of pooling is to spread financial risk across the population so that no individual carries the full burden of paying for health care. 2016;15(1):165. In: Chernichovsky D, Hanson K, editors. However, evidence for efficiency improvement with increased market competition among purchasers is weak [25]. This has an adverse impact on equity in resources across pools. To ensure key development programmes are adequately funded [5,6]. OECD, World Health Organization. PubMed 192 0 obj<>stream
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fragmented systems with voluntary health insurance, duplicating publicly financed coverage; and (8.) Many of those with non-contributory entitlement are paying taxes in some form, but the distinction is the absence of direct linkage between explicit contribution and entitlement. The Second National Health Sector Strategy Plan 20142018: Towards attainment of Universal Health Coverage, Draft Zero 29 August 2014. Fragmentation is further aggravated, as a small part of the better-off population is often enrolled in commercial voluntary health insurance, whilst a small share of people in the informal sector may enroll in voluntary community-based health insurance schemes [41, 42]. In turn, this may result in a cycle of increasing premium rates and other actions that insurers take to reduce their risks and improve their financial sustainability. the mobilization of resources for the health sector; 2) pooling, i.e. Financial Management Functions. Geneva: World Health Organization; 2010. The set of performance indicators provided in this article should help policy makers to monitor the development of social health insurance schemes and identify areas for improvement. a single pool; (2.) Based on this, we identify and present broad types of pooling arrangements and related fragmentation issues and discuss implications and challenges. The market for lemons: quality uncertainty and the market mechanism. Health financing has three key functions: revenue collection, pooling of resources, and purchasing of services. 1 / 64. People who have higher risks are just as covered as people who have lower risks. Thomson S. What role for voluntary health insurance? As such, this type of pooling arrangement, if and when it has an effective risk adjustment mechanism that deters risk selection efforts, can act as a virtual single pool (due to the flows between the pools). These are 1) the nature of pooling and 2) the structure of pooling. 0000009066 00000 n
Int J Equity Health. WHO Regional Office for Europe: Copenhagen; 2016. SMG 1117A.641 . The total health expenditure per capita increased from US$ 12 in 1998/1999 to US$25 in 2005/2006. Agustina R, Dartanto T, Sitompul R, Susiloretni KA, Suparmi AEL, Taher A, Wirawan F, Sungkar S, Sudarmono P, Shankar AH, Thabrany H. Universal health coverage in Indonesia: concept, progress, and challenges. To understand the key challenges to health systems. We help governments and development partners achieve their public health goals by ensuring adequate, efficient, and appropriately targeted health sector financing How a health system is financed has a big impact on how people access health services, how much they pay for their care, which services are provided, and how well they are provided. Soors W, Devadasan N, Durairaj V, Criel B. Health system review. Health financing: the basics FP Financing Roadmap. Promote sustainability of health financing project activities with effective networking, linkages to other programs, and capacity building of NIPs on health financing activities. Article Typically, this is the consequence of historical policy decisions that emphasized starting insurance with formal sector employees because of the relative ease of collecting contributions from them [19]. The authors declare they have no competing interests. View below: When viewing on a desktop, maximize for optimized view. volume18, Articlenumber:198 (2019) Discussion paper. Smith PC, Witter SN. Paris: OECD; 2011. The Canada health transfer: changes to provincial allocations. endstream
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Sagan A, Thomson S. Voluntary health insurance in Europe: role and regulation. 2012;380(9849):125979. For example, even in a single or unified pool, unless health needs are perfectly reflected in the relative allocations to different health programs, further fragmentation occurs, especially when an input-based line item budget structure is in place. 0000080023 00000 n
the mobilization of resources for the health sector; 2) pooling, i.e. But services are typically grossly underfunded and often unavailable, thus resulting in implicit benefits [1]. World Health Report. 2016;18(2):1239. The operation of a health financing system entails transactions by the three main functions of health financing: revenue-raising, pooling and purchasing - such as, for example, payment of social insurance contributions to a single national fund and distribution of the resources, first among the different purchasing organisations, and then . Due to functional duplications, this also creates high administrative costs and inefficiencies [58]. Q J Econ. Although this pooling arrangement does not fully overcome fragmentation and population segmentation, it substantially reduces it. xref
This makes it affordable to them and addresses the inequity concerns that come along with complementary health insurance [53]. PubMed poverty status) or costs of serving the population of a specific region (e.g. different pools for different population groups, with explicit coverage for all; (6.) Available from: https://www.academia.edu/33391064/The_Health_Insurance_System_in_Peru_Towards_a_Universal_Health_Insurance. On the other hand, competition among insurance pools creates an incentive for pool managers to cream skim, i.e. Mathauer I, Mathivet B, Kutzin J. Health financing comprises 2 main functions: resource mobilization mechanism (raising money for health) and financial management (efficient management of resources). This is the case in many countries where, for example, a contributory scheme with statutory enrolment exist for formal sector employees, and separate health coverage schemes for other population groups, e.g. 2014;29:71731. What are the four major services and healthcare? Gautier J. The resources allocated to these different pools may come from a mix of centrally and sub-nationally raised revenues, with allocations often based on a consistent formula applied across the country. SMG 1117A.641 (02/09/2022) 1 . Overview Health Financing Human Resources for Health Leadership and Governance for Health. Privacy Preker A, Langenbrunner J. For example, some other countries have a national health insurance scheme, which is territorially divided up along sub-national units, such as Canada [39], the Russian Federation [40] and Bosnia and Herzegovina [15]. 2019, 5/393(10166):75102. the allocation of pooled funds to health service 2016;15:7. Int J Equity Health. Innovations in Health System Finance in Developing and Transitional Economies. Kutzin J. As you can see, out-of-pocket or fee-for-service, government budget, or insurance agencies are all means of purchasing health care from providers. Health nutrition and population discussion paper. Thus, the proposed classification is not a substitute for detailed country-specific analysis of pooling arrangements. Many others receive poor quality of services even when they pay out-of-pocket. Due to voluntary participation, small pool size and little or no subsidization of poor and vulnerable groups, CBHI can play only a very limited role in progressing towards UHC. Indeed, these arrangements put in place for health financing further exacerbated existing inequalities in these countries rather than compensating for them. By using this website, you agree to our The attributes of a countrys pooling arrangements that have positive implications for UHC goals are in many ways the opposite of what is implied by fragmentation. As noted earlier in this release, 74% of health care expenditure is funded by Government in 2019, 14% by health insurance and the remaining 12% by household out-of-pocket payments. 2016;15:67. 0000006764 00000 n
Objective Health financing assessment is of growing interest to policy makers to develop reform strategies towards achieving universal health coverage. Bingley: Emerald Group Publishing; 2009. p. 291312. Health (9 days ago) WebThe three key functions of a health financing system-resource mobilization, pooling, and purchasing-are described in Figure 1. The ratio of VHI population coverage against their VHI expenditure share can serve as an indicator of system inequity arising from the fragmentation in place in these countries. The company has multiple offices in the U.S. and program offices in more than 40 countries. Health Systems in Transition. the allocation of pooled funds to health service providers [1]. Cuba, with a much larger population, also has this setup, as does Sri Lanka, where financial protection performance is relatively good despite a high share of OOP [29]. To cite variations across countries of different income levels. 787 0 obj
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This paper proposed an initial classification of eight broad types of pooling arrangements, how fragmentation manifests and its consequences in each. Int J Equity Health. management and disbursement for financing the availment of a basic minimum package and other . 814 0 obj
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These countries had therefore decided to create an explicit coverage program for people outside the formal sector, whilst trying to gradually increase the level of funding to narrow the gap in per capita expenditure across the different schemes. Health Policy. Google Scholar. Community based health insurance: how can it contribute to progress towards UHC? Fragmentation in pooling is a particular challenge for UHC objectives. startxref
Its main purpose is to share the financial risk associated with health . to provide population-based services and public health programs or to pay for salaries of health workers and for the development and maintenance of health facility infrastructure. 201102-E 25. Maximum redistributive capacity from prepaid funds is achievable in these settings. It is voluntary because there is no legal obligation to join a scheme, and thus the person or their employer can choose not to be part of a pool for coverage [22]. 0000013724 00000 n
Article California Privacy Statement, A summary from expert and practitioners discussions, health financing working paper no. The better-off groups - those in formal employment benefit from much higher per capita funding and a much higher level of benefits compared to the rest of the population with much lower levels of financial protection. agencies that manage pools (typically insurance schemes) compete for members. The Health Financing Specialist will be based in the Abt office in Antananarivo. Analysis was performed in line with the various NHA entities and health system financing functions. Its main purpose is to share the financial risk associated with But where territorially distinct pools are too small in terms of the number of people, their risk profile can be financially precarious and there could be efficiency and capacity concerns. State budget transfers to health insurance funds: extending universal health coverage in low- and middle-income countries of the WHO European region. Berkshire: Open University Press; 2005. van de Ven WP, Beck K, Van de Voorde C, Wasem J, Zmora I. Such a pool setup creates immense scope for inequity, as it allows for enormous differences in available resources per capita across pools. voluntary health insurance). Thailand is a prominent example for this pooling arrangement. Risk pooling in health care financing: the implications for health system performance. Subsidized health insurance coverage of people in the informal sector and vulnerable population groups: trends in institutional design in Asia. Washington DC: World Bank; 2006. 0000002548 00000 n
Risk selection negatively affects the redistributive capacity, as healthier and wealthier individuals and their contributions often end up in a different pool than poorer and sicker members with (usually) lower contributions. Mexicos Seguro Popular also shifted to this principle of automatic coverage of all people who are not part of an insurance scheme for formal sector employees [47, 48]. Health financing involves not only methods of raising money for health care, but also allocation of those funds. 0000000016 00000 n
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