Transcript Guidelines - shdrc.org
Designing Health Financing System to Achieve Universal Coverage
Ke Xu Health Systems Financing World Health Organization November 2008, Shanghai
1 | Health System Financing
Universal Coverage as a Policy Objective
defined as everyone having access to appropriate care when they need it and at affordable cost implies
financial risk protection
and
equity of access
associated with
equity in financing
( contribution according to ability to pay)
Resolution "Sustainable Health Financing, Universal coverage and Social Health Insurance" May 2005. Geneva 2 | Health System Financing
Three Dimensions of Universal Coverage
3 | Health System Financing
Universal Coverage Getting the Mix Right
Revenue collection Pooling Purchasing Collect funds (taxes or contributions) efficiently and equitably Costs are shared by all and not borne by people when they are ill wealthy & healthy subsidize the poor & sick Buy or provide effective health interventions Incentives for efficiency 4 | Health System Financing
Revenue Collection
Sustainability
Is the money collected in an equitable way?
Does the collected sufficient?
Equity
How much I pay and how much others pay?
5 | Health System Financing Efficiency
How to collect a sufficient amount of money with minimum administrative cost?
Health Financing Mechanisms
Financing mechanisms
Tax-based financing
Financing sources
1. General tax or other revenue External resource 2. Payroll tax Health care services
6 | Health System Financing
Social health insurance Other prepayment schemes
Out-of-pocket payments
3. Contribution or premium 4. Direct payment Household Natural resource revenue
Revenue Collection
Generally a mix of different types of revenue collection mechanisms co-exist:
– Tax based funding • General taxation, earmark taxes – Compulsory insurance • Payroll tax and contribution • • Formal and informal sector employees Dependants – Voluntary insurance
7 | Health System Financing
Social Health Insurance- Constrain Factors
•Income level and growth •The structure of the economy •The distribution of the population •Administrative capacity •Solidarity •Stewardship
8 | Health System Financing
Funds Pooling
How far can solidarity go ? – – – What level of cross-subsidies from rich to poor and from healthy to ill? Any role for supplementary or complementary health insurance ?
Should opt-out be allowed (Latin America, Germany)?
How many pools-risk adjustment/ risk-equalisation?
– One pool (Korea, Turkey) – – Multiple pools (Germany, Netherland, Switzerland …) Fragmentation and segmentation How should tax-based funding be channeled? – – – To provider (Latin American countries)-low price services To insurance funds- low insurance premium To consumers (cash transfer)- to purchase services or insurance
9 | Health System Financing
Proportion of households with catastrophic expenditures vs.
share of out-of-pocket payment in total health expenditure
3 5 8 14 22 37 out-of-pocket payment in total health expenditure % (logarithm) OECD others 61 100
Purchasing
Strategic purchasing Provider payment mechanisms
Outpatient service Inpatient service Drugs High-tech medical equipments
Benefit package design
Differentiate cost sharing among different services and drugs
No over provision 11 | Health System Financing No over utilization
By Pia Schneider: Provider Payment Reforms: Lessons from Europe and America for South Eastern Europe
12 | Health System Financing
The Design Features of Benefit Package Risk protection Budget constrain The size of benefit package Width The number of services 13 | Health System Financing Depth Cost-sharing Structure What services and how much
OOP Components by Quintiles (Korea, 2007)
100% 80% 60% 40% 20% 0% 1 drug 2 3 equipment 4 service 5
14 | Health System Financing
to tal
Catastrophic Expenditure by Different Payments (Korea)
35% 30% 25% 20% 15% 10% 5% 0% 2003 2004 2005 2006 2007 outpatient inpatient dental drug
15 | Health System Financing
Percentage of Households Reporting Non-zero Inpatient Expenditure (Korea, 2007)
3 2 1 0 6 5 4 1 2 3
quintiles
4 5 Total
16 | Health System Financing
Stages of Coverage and Organisational Mechanisms Universal Coverage Absence of financial protection
Out-of-pocket spending
17 | Health System Financing Intermediate stages of coverage
Mixes of community cooperative and enterprise based health insurance, other private health insurance, SHI type coverage for specific groups and limited tax based financing •Tax-based financing •Social health insurance •Mix of tax-based and various types of health insurance
How Long It Takes to Reach Universal Coverage?
Time (in years) between first social protection law and universal coverage Costa Rica Republic of Korea Japan UK Austria Belgium Germany
20 26 36 36 79 118 127
18 | Health System Financing
Summary 1.
Achieving universal coverage takes time, a long-term vision is important 2.
Revenue collects through equitable and efficient ways 3.
Increase prepayment and reduce out-of-pocket payment 4.
Improve financial risk protection through an appropriate benefit package 5.
Improve service quality and control cost through a set of provider payment mechanisms.
19 | Health System Financing