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Session 1:
Program
Health Policy
International
-Thailand
Program
Policy
Health
International
-Thailand
What do we expect on
healthcare financing?
ILO-WB-MOPH Workshop on Model Development
for Sustainable Healthcare Financing
Holiday Inn, Bangkok
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Viroj Tangcharoensathien MD Ph.D.
IHPP-Thailand
Ministry of Public Health
11 June 2007
https://www.ihpp.thaigov.net
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Program
Health Policy
International
-Thailand
Program
Policy
Health
International
Background
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-Thailand
Total Health Expenditure,
Amount of THE and ratio of THE to GDP, current prices, 1994-2001
3.47%
3.49%
6.00%
3.84% 4.00%
170,000 3.52%
3.53%
3.40% 3.32%
3.74%
3.50%
4.00%
120,000
2.00%
THE% GDP
3.68% 3.55%
220,000
Mln.Baht
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Program
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NHA 1994 – 2005
70,000
20,000
0.00%
1994
1995
1996
1997
1998
1999 2000
2001
2002
2003
2004
year
2005
investment
Operating health expenditures
Ratio of THE to GDP (%)
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Trend of financing sources
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Program
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NHA 1994-2005
million baht
250,000
200,000
150,000
53
100,000
50,000
55
45
46
37
45
45
44
37
36
36
44
53
47
47
54
55
55
56
56
63
63
64
64
0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Government
NON Government
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Program
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Objectives
• What do we expect on healthcare financing in Thailand?
• Have we achieved these expectations?
– If yes, how to sustain them?
– If no, how to achieve – roadmap?
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What do we expect on healthcare financing? (1)
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1. Has high capacity to prevent
• Catastrophic health expenditure by the households
• Impoverishment from sickness and medical bills
2. Can achieve vertical equity
• Payment according to ability to pay: namely the poor pay less
for their medical care and the rich pay more
• Use of healthcare according to health needs
3. Large pool of risk sharing across population
• Pre-payment schemes replacing out of pocket at point of
services
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What do we expect on healthcare financing? (2)
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4. Achieve health systems efficiency
•
•
Technical efficiency: purchase services from the lower cost
given equal quality of care.
Allocative efficiency: purchase the interventions that
achieve maximum health gain of the population
5. Has capacity to contain cost in long term
•
•
Provider payment methods send appropriate signals to
healthcare providers and consumers towards efficiency
Annual growth of healthcare spending is within an
acceptable limit
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What do we further expect?
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Health Policy
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1. Institutional and human capacity to
•
Generate and maintain evidence for decision
•
•
•
National representative household information–illness rates,
access and utilization, catastrophic, impoverishment, and its
SE differentials for equity monitoring
Administrative data
• Utilization information,
• Clinical outcome data
• Cost of production
To achieve these goals, there requires
•
•
•
Better quality, timely, accessible database for M&E of
financing situation
Improvement of database for M&E
Institutional capacity to maintain series of database
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Have we achieved? (1)
• Yes, achieved some expectations, but not all
• What has Thailand achieved?
1. Minimum incidence of
• Catastrophic health expenditure
• Comprehensive benefit package
• Literally zero copayment in all 3 public insurance schemes
• Though some beneficiaries opt out and use services outside
the entitlements and face full payment
• One service not covered: renal replacement therapy for UC
members
• Impoverishment due to medical bills
• Especially the virtue of universal coverage scheme since 2002
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Household health expenditure
as % of household income by income deciles
8.17
8
1992
7
1994
6
1996
4.82
2
2.23
1
2.93
2.38 2.52
2.22
1.77 1.75 1.62
1.4
1.37
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ec
il e
6
D
ec
il e
5
D
ec
il e
4
D
3
ec
il e
D
ec
il e
2
D
ec
il e
1
D
ec
il e
D
1.64
2.36
2.06 1.97
1.68 1.55
1.32 1.35 1.57
1.15
0
Source: NSO SES (various years)
1.99
1.27
2002
2004
1.27
1.1
1.07
2006
10
3.32 3.16
3.29
2.78
2000
2.45
9
3.67
2.57
ec
il e
3
2.87
D
4.58
ec
il e
4.58
8
4
1998
3.74 3.65
D
5.46
ec
il e
5
D
Health payment : Income (%)
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prior to UC (1992-2000) and after UC 2002-2006
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Pre-post UC incidence of catastrophic expenditure
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Households with health payment > 10% of total consumption expenditures
All households
LIC/VHC
UC–E/-P
4.0%
5.6%
5.4%
2.7%
7.1%
4.7%
1.7%
5.0%
3.3%
1.7%
6.1%
3.2%
1.6%
4.3%
2.8%
1.6%
5.2%
2.6%
0.9%
3.3%
2.0%
0.9%
3.0%
1.9%
Year 2000
Quintile 1
Quintile 5
All Quintiles
Year 2002
Quintile 1
Quintile 5
All Quintiles
Year 2004
Quintile 1
Quintile 5
All Quintiles
Year 2006
Quintile 1
Quintile 5
All Quintiles
Source: NSO’s SES (various years)
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Have we achieved? (2)
2. Vertical equity
• Equity in financial contribution
• Direct tax is most progressive than indirect, than
social health insurance contribution, than private
insurance premium and OOP
• General tax finance is therefore progressive (the rich
pay more), and the dominant role in financing
healthcare in Thailand
• SHI contribution, the maximum wage for calculation of
contribution was 15,000 Baht/month since 1991, it
has not been indexed ever since
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Various Financing Sources for Healthcare
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Progressivity - Thailand
Source
2002
2004
2006
CI*
Fraction**
CI*
CI*
Direct tax
0.8221
18.68%
0.8162
0.7687
Indirect tax
0.5594
31.55%
0.5958
0.5512
0.4975
5.82%
0.4561
0.4492
0.3785
6.68%
0.4221
0.4188
0.4883
37.28%
0.4626
0.4705
0.5663
100%
Social
insurance
Private
insurance
Direct
payment
Total
* CI – Concentration Index based on Socio-Economic Survey (SES: 2002, 2004, 2006)
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** Fraction of health expenditures per source derived from Thailand National Health Account (NHA)
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Have we achieved? (3)
2. Vertical equity (continue)
•
Equity in healthcare utilization
•
•
•
•
Equity in public health spending
•
•
•
Concentration index indicates the poor use more service
in public sector
Better access to services in vicinity areas: the pivotal
role of district health system (DHS) as a major hub of
equity achievement
DHS is the main contracted provider for UC Scheme
Benefit incidence: public subsidy favours the poor
especially at DHS
Available of alternative private services for the better off
Equity in health of the population
• Other social determinants of health plays
significant role
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The distribution of ambulatory service use among different income
quintiles in 2001 and 2003, by types of health facilities
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Ambulatory visits per cap per year
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Distribution of ambulatory services at different health facilities between
the 2001 and 2003 HWS
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0.7
4
3
0.4
2001
0.6
1.8
0.3
0.4
0.4
0.7
2
0.6
0.7
0.6
1
1.2
Q1
0.6
0.4
1.3
0.7
0.5
0.4
0.7
0.6
1.0
0.7
0.2
0.5
0.6
0.2
0.1
Q2
Q3
Q4
Q5
0
2003
0.7
0.3
0.4
0.9
1.9
0.7
0.6
0.7
0.6
0.3
0.3
0.2
Q3
Q4
Q5
1.3
Q1
Q2
Income quintiles
Health centre
Community hospital
Provincial and regional hospital
Private clinic
Private hospital
Concentration indices of ambulatory service use among different types of health facilities in 2001 & 2003
Type of health facilities
2001
2003
Health centers
- 0.2944
- 0.3650
Community hospitals
- 0.2698
- 0.3200
Provincial and regional hospitals
- 0.0366
- 0.0802
Private hospitals
0.4313
0.3484
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Distribution of hospitalization among different types of health facilities
between the 2001 and 2003 HWS
0.25
Admission per cap per year
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The distribution of hospitalization among different socio-economic groups
in 2001 and 2003, by types of health facilities
0.03
0.2
0.01
0.02
0.05
0.15
2001
0.05
0.01
0.01
0.02
0
prov / reg
hospitals
Q4
Q3
Q2
0.01
0.02
Q1
0.02
0.03
0.05
0.04
district hospitals
0.05
0.05
0.03
2003
0.03
0.05
0.1
Q5
0.06
0.01
0.01
0.01
0.01
0.03
0.02
0.01
0.01
0.00
0.01
0.02
private hospitals district hospitals
prov / reg
hospitals
private hospitals
Types of health facilities
Concentration indices of hospitalization among different types of health facilities in 2001 & 2003
Types of health facilities
2001
2003
Community hospitals
- 0.3157
- 0.2934
Provincial and regional hospitals
- 0.0691
- 0.1375
Private hospitals
0.3199
0.3094
Overall hospitalization
- 0.0794
- 0.1208
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A comparison of percent distribution of net government health subsidies among different
income quintiles in 2001 and 2003
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30
31
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25
22
20
percent
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Percent distribution of net government health subsidies among
different income quintiles in 2001 and 2003
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17
17
15
15
16
18
15
2001
2003
10
5
0
Q1
Q2
Q3
Q4
Q5
Income quintile
Note:
-Overall net government health subsidies in 2001 were approximately 58,733 million Baht, and in 2003 were
80,678 million Baht (in 2001-value)
- The concentration index of government health subsidies in 2001 was -0.044 and in 2003 was -0.123
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Have we achieved? (4)
3. Large pool of risk sharing
• Three public insurance schemes covers the whole population
• Social Health Insurance: covers 9 million private formal sector
employees; mandatory, tripartite contributory scheme
• CSMBS: covers 6.5 million govt. employees, pensioners, and
dependants; general tax financed, fringe benefit scheme
• UC scheme : covers rest of pop. (48 million); general tax
financed scheme
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Have we achieved? (5)
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4. Health systems efficiency
• Technical efficiency: purchase services from the lower cost
given equal quality of care
• DHS provides decent quality of services with lower cost
• DHS is “close to client services” better accessed – and lower
access cost paid by the beneficiaries
• Referral backup well in place
• Allocative efficiency:
• Active purchase of prevention and health promotion services
for the whole population – but still on clinical personal
preventive services.
• However, community based public health interventions were
financed by Thai Health Foundation
• Unsure if we achieve this.
• Require more evidence on cost effectiveness of various
interventions and re-design of benefit package
• Awaiting the contributions from the Health Technology
Institute (IHPP HITAP)
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Have we achieved? (6)
5. Long-term cost containment
• Partially achieved for the whole country
• CSMBS – fee for service reimbursement model is the
remaining problem – high cost escalation and difficult to
sustain
• UC scheme: application of contract model: capitation
for ambulatory care and P&P package, global budget + DRG
for inpatient services
• Social Health Insurance: application of contract model:
inclusive capitation for OP + IP services
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CSMBS total expenditure and growth
1988-2006
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40,000
0.3
28%
35,000
0.25
33,865
19%
19%
30,000
29,775
16%
25,000
0.2
26,857
13%
20,480
11%
20,000
8%
8%
14%
13%
23,743
19,351 18,932
8%
15,000
11%
18,589
17,907
17,498
21,623
0.1
10%
10%
6%
4%
14,671
0.15
0.05
13,563
11,390
10,000
0
8,229
8,921
7,268
5,000
5,816
-2%
6,270
million of employees/pensioners
-0.05
-5%
-
-0.1
Growth rate
real term
Norminal
Source: Comptroller General Department, Ministry of Finance (various years)
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Have we achieved? (7)
1. Institutional and human capacity – self assessment
score 6/10
•
•
•
•
•
•
•
•
•
•
•
•
NSO (national representative household survey dataset
HWS, SES, others),
NHSO (UC scheme and performance),
MOF NESDB (economic dataset)
SSO (SHI and its performance),
MOF (CSMBS and its performance),
CHI (national IP dataset),
HSRI (funding supports),
HISO (Health Information)
HISRO (health insurance),
BOD Office (Burden of diseases)
IHPP (NHA, NAA)
Health Intervention and Technology Assessment Program –
HITAP – assessment of priority health technologies and
policies
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Sustaining the achievements (1)
1. Catastrophic health expenditure and impoverishment
•
Maintain comprehensive benefit package and zero copayment
•
•
•
But moral hazard generated from totally free services should be
monitored
Improve service quality and consumer satisfaction to prevent
opting out
Careful decision on extension of renal replacement therapy for
UC members
•
•
Significant long term fiscal implications
Rationing may required
2. Vertical equity
•
•
•
Maintain the progressivity and dominant role of general tax in
financing healthcare
Adequate funding for DHS for fostering equity in utilization
and public subsidies
SHI: need further assessment of the equity in contribution
and benefit gained both in cash and in kind among the rich
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and poor employees.
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Sustaining the achievements (2)
3. Large pooling of risk
•
Already in the Law
•
Challenge to harmonize the 3 public schemes
4. Health systems efficiency
•
Technical efficiency
•
•
Maintain and foster the role of DHS as primary contractor
and gate keeper + optimum referral backups
Allocative efficiency
•
•
•
Foster the investment of P&P package
Rapid generation of evidence on cost effectiveness of
interventions for the future re-design of benefit packages
Invest more on risk reduction, healthy lifestyle to address
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chronic NCD
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Sustaining the achievements (3)
5. Long-term cost containment
•
Maintain capitation contract model of Social Health Insurance
scheme and UC scheme
•
Financing and provider payment reforms of CSMBS
•
Towards close end expenditure
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Future actions: roadmap (1)
1. Modelling/ projection of total resource requirement
• Stepping stone: NHA 1994-2005
• Regular exercise and update of resource projection and
reviews of fiscal spaces
2. Look for new and sustainable sources of finance
• Replacing general tax annual budget cycle (sweating political
processes, lack of evidence and politicize)
• Earmark tax dedicated to NHSO
• Consolidate Third Party Liability scheme
• Now cream skimming and unethical profit making by
private for profit insurance companies
• Review of fiscal space
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Future actions: roadmap (2)
3. Take into account international experiences, to assess the
driving forces of healthcare expenditure
• Cost of production
• Technological advancement [diagnostic and therapeutic]
• Utilization of services
• Ageing population
• Utilization intensity
4. National capacity to produce evidence for technology
adoptions • Evidence on cost effectiveness, budget impact assessment,
societal preference on benchmark of CER for investment
• Effective interfaces between evidence and decision making and
redesign of benefit package
• Do no under-estimate the power of pharma and medical27
device industries – therefore need good governance
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Program
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Acknowledgments
•
National partners
– National Health Security Office (NHSO) and other partners who initiate,
design and steer the UC scheme
– HSRI for supports on NHA development since day one until institutionalized
– HISRO, HISO for their technical and financial supports
– Ministry of Public Health (MOPH) major healthcare providers and steer the
implementation of UC scheme.
– National Statistical Office (NSO) for national household surveys
– Thailand Research Fund (TRF) for institutional grants to IHPP
•
International partners
– World Bank and MOPH partnership on Country Development
Partnership in Health Sector
– ILO for peer reviews of capitation rate 2002, and long term financing
forecast 2005-2020
– WHO and Harvard for studies on ethical dimension of RRT extension to
UC members
– EU funded Equity in financing, health utilization and public subsidies in Asia
Pacific (EQUITAP)
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Thank you for your kind attention
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-Thailand