3 August 2004

Public Health Practice III: FINANCING PUBLIC

HEALTH REFORM

Thomas E. Novotny MD MPHUniversity of California San Francisco

Institute for Global Health

Learning objectives Establish context for health systems

Provide general description of existing healthcare systems

Describe role of World Bank in policy

Present current World Bank policy

Identify issues with proposed direction

Populations and disease

Health status indicators

Epidemiologic transition

Demographic transition

Poverty as root cause

Declaration of Alma Ata (1978) Definition of health

State of complete physical, mental and social wellbeing

Not merely absence of infirmity or disease Fundamentally human right Attainment of highest possible level is

worldwide priority and common concern of all countries

Primary care Essential health care Universally accessible Affordable cost

Primary health care defined Addresses main health problems in

community Provides promotive, preventive, curative

and rehabilitative services Broad definition to include proper

nutrition, safe water, basic sanitation, prevention and control of communicable diseases, provision of essential drugs

Promotes community self-reliance using local and national resources

Elements of Health Systems Production of resources (people,

supplies, facilities, knowledge) Organization of programs (government,

private providers, NGOs) Economic support mechanisms (source

of funds) Management methods (planning,

administration, monitoring and evaluation) Delivery of services

(preventive/curative, primary/secondary/tertiary, public health)

Economic Dimensions of Health Systems

Source of payment Voluntary (private insurance, user fees) Compulsory (taxes, social insurance)

How services provided Direct ownership by government Contractual arrangements Private providers paid directly by consumer

How services paid Prospectively – provider assumes risk Retrospectively – costs reimbursed

Four key actors

Government

Population to be served

Financing agents

Providers

Four key functions

Regulation

Financing

Resource allocation

Providing services

Current situation Government as largest provider

universal access high spending on hospitals highly centralized bureaucratic fluctuating budgets poor motivation

ISSUES

Market model not panacea

Ability of Ministry of Health to lead transformation

Lack of management capacity to implement changes

Current situation

Changing public or private insurance

Half of spending “out-of-pocket” Mainly pharmaceuticals

Current situation

Limited power of Ministry of Health

Private provider = quality provider

Lack of access for certain populations

World Bank as opinion leader

Health is addressed through economic development

Burden of disease translates into economic terms (DALYs)

World Bank as opinion leader

Government and private sector have

separate roles

prevention/public health

essential package of services

curative care

World Bank as opinion leader

Health system barriers to progress misallocation inequity inefficiency exploding costs

Why health sector reform?

Recognition of need for healthy population

Part of overall lending packages

Enhancing the performance of health services

Key concepts for health sector reform

Accessibility

Efficiency

Effectiveness

Quality

Consumer satisfaction

Accessibility

Equitable

Reduced barriers

Effectiveness

Spend money in the right place – most benefit to most people

Improve clinical outcomes

Increase accountability

Efficiency

Maximize the money spent

Increase management capacity

Provide incentives

Quality

Incentives for change

Information widely available

Accreditation processes

Consumer satisfaction

Increased choice

Informed choice

Input to services provided

POLICY SOLUTIONS

Enable households to improve health

Improve government investments in health

Promote diversity and competition in financing and delivery

POLICY ONE: Enable households

Economic growth policies that benefit poor

Expand investment in schooling Promote human rights

POLICY TWO: Improve government investment

Reduce spending on tertiary and

specialty care with low cost benefit

Finance and implement package of

public health interventions

POLICY TWO: Improve government investment

Finance and ensure delivery of package of essential clinical services

Improve management through decentralization and budget autonomy

POLICY THREE: Promote diversity and competition

Government provides public health and essential services

Private insurance for clinical services outside essential package

POLICY THREE: Promote diversity and competition

Encourage privatization of all clinical

services

Produce information on provider

performance

Expanding access to health research.

www.plosmedicine.org

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