Depth of Financial Risk Portection in Latin American Health Systems and Role of Health Systems...

8/2/2019 Depth of Financial Risk Portection in Latin American Health Systems and Role of Health Systems Desing 130711

1/23

July, 2011

Felicia Knaul

Rebecca Wong

Hctor Arreola Ornelas

Oscar Mndez

and the Research in

Health Financing

Latin

American Network(RHF-LANET)

Health financing andsocial protection in

Latin America and theCaribbean

UCR


2/23

Outline

1. Context, Origin,

Motivation2. Comparative Analysis

3. Mexico

4. Conclusions


3/23

Origin of LAnet

The Impact of Health Financing and Household HealthSpending on Financial Equity and Impoverishment: Acomparative analysis of 7 Latin American countries(2007)

Mexican Health Foundation Founding funder: International Development Research Center of

Canada

To study household health spending in a group of Latin Americancountries and establish a connection between out of pocketspending and health system organization and health financing

`07: Mexico, Colombia, Chile, Brazil, Argentina, Peru, Costa Rica

`08+: Bolivia, Dominican Republic, Guatemala, Ecuador andNicaragua thru the LAC Health Observatory with support from the

Carlos Slim Health Institute


4/23

LANET in financial protection: ParticipatingCountries (11) and Institutions (18+)

MexicoFUNSALUD, Instituto National de Salud Pblica and the LA HealthObservatory (OS-LAC). Felicia Knaul, Hector Arreola, Gustavo Nigenda

Argentina - Centro de Estudios de Estado y Sociedad (CEDES). Daniel Maceira

Bolivia - Unidad de Anlisis de Polticas Sociales y Econmicas (UDAPE).Cecilia Vidal and Werner Valdes

BrazilFundacin Instituto de Investigaciones Econmicas (FIPE) and

University of Sao Paulo (USP). Roberto Iunes and Antonio Campino

Chile -Ibero American Health Economics Foundation, and the University ofChile. Ricardo Bitran and Vito Sciaraffia

Colombia PROESA, Ramiro Guererro, Centro de Estudios sobre DesarrolloEconmico (CEDE) - Los Andes University. Carmn Elisa Flrez and Ursula Giedion

Costa Rica - Costa Rica University.Juan Rafael Vargas, Jorine Muiser

Dominican Republic - Fundacion Plenitud. Magdalena Rathe

Ecuador - Fundacin Accion Social. EcuadorRuth Lucio and NildhaVillacres

Guatemala - Ministerio de Planeacion Social. GuatemalaRicardo Valladares

Peru - Grupo de Anlisis para el Desarrollo (GRADE). Martn Valdiviaand

Universidad del Pacifico, Janice Natalie Seinfeld Center on Aging and Health, University of Texas. Rebeca Wong


5/23

Atlas of Health Systems in LatinAmerica and the Caribbean

Countries: 17Argentina, Bolivia, Brazil, Colombia, Costa Rica,

Cuba, Chile, Ecuador, El Salvador, Guatemala,

Honduras, Mexico, Nicaragua, Peru, Dominican

Republic, Uruguay and Venezuela

Contents in design:1. Context

2. Structure and coverage

3. Financing

4. Resources

5. Stewardship

6. Responsiveness

7. Innovations


6/23

Global Networkfor Health Equity: GHNE

EQUITAP, Lanet, SHIELD: a triple South allianceflagship project of IDRC

Equity + UHC + Health financing

35 countries, 113+ researchers, 60+ institutions Initiated work at the First Global Symposium on

Health Systems Research (Nov 15th) with IDRCcatalytic support

3S agenda and proposal to IDRC focussing on: A second-third generation research agenda

Capacity building: students, researchers and PMs

Policy translation: evidence-for-advocacy, for -

decision making and for-action


7/23

Financial vulnerability and shocks inhealth as a global problem

EQUITAP: van Doorslaer E, ODonnell O, Rannan-

Eliya RP, Somanathan A, et al., TheLancet, 2006.

The total estimated increase in the poverty

headcount was 78 million people, which is almost3% of the population under study in 11 low to

middle-income countries in Asia.

Each year worldwide - the figure is unknown and

grossly underestimated:

??WHO: 150 million people suffer financial catastrophe annually

while 100 million are pushed below the poverty line as a result of

health spending.


8/23

12-country Analysis: Challenges

Heterogeneity of the data Different surveys: living conditions; health

surveys; surveys of income and expenditure Recall period of health expenditures

Questions concerning health expenditures Measurement of income and total expenditure

Homogenization of key indicators Definition of the ability to pay (generally for the poor) Comparability of poverty lines

Threshold levels for catastrophic

Connecting catastrophic health expenditures (CHE)

and impoverishing health expenditures (IHE).


9/23

Comparative Analysis (Wong et al):Research Strategies

Indicators of catastrophic health expenditures Poverty line of 1 dollar PPP

Threshold: 30% of capacity to pay

Any health expenditure greater than zero for poor households isconsidered CHE (Wagstaff-van Doorslaer, World Bank)

Multiple indicatos

Sub-groups to measure the relative risks

Residence (urban/rural)

Quintile (Poorest/Richest)

Household size (Large/Small) Household composition (with children under 5, with adults over

60, with no children, and with no elderly adults)

Insurance status for the household (Insured/Uninsured)

Data from approximately 2006 and is nationally representativeother than Chile (urban)


10/23

Prevalence of catastrophic health expenditure(% of household per quarter)

I1: simple:

(OOP/Total exp food)>=30%

Indicator WD:

OOP/Total exp

food>=30%Or

PL>Total exp `&` OOP>0

048

1216

Chile

Guatema

la

Nicaragua

Dom

.Rep..

Argentina

Ecuador

Peru

Bo

livia

Co

lom

bia

Mexico

Brazil

C.

Rica

05

101520

Nicaragua

Guate

ma

la

Ecuador

Chile

B

olivia

Peru

Dom

.Rep

.

Arge

ntina

M

exico

Brazil

Colo

mbia

C

.Rica


11/23

0

1

2

3

45

05

1015202530

Results: Relative Risks ofCatastrophic Health Expenditure (I2)

Rural/Urban

Poorest quintile/ Richest quintile

Note: WD indicator


12/23

Relative Risks

Rural/ Urban NA

Poor/Rich

Children in the

household

Adults > 60 years

in the household

More than 4

members

Uninsured

households

Relative Risks, Catastrophic HERobustness of the Analysis:

: ratio is significantly LESS than 1 : 1 < ratio


13/23

Conclusions: regional analysis

5-6 million households encounter CHE each period of

analysis (year?) in the 12 countries(Wagstaff style indicator, with 30%)

Range: 60 years

Lack of health insurance Poverty

Residence in rural area

Large households with >60 &


14/23

ALL HEALTH SYSTEM FINANCING COMES FROM HOUSEHOLDS,BUT THERE ARE THREE PAYMENT METHODS: GENERAL TAXES,SOCIAL SECURITY, AND OUT-OF-POCKET (OOP). AS A MEANS OF

FINANCING HEALTH, OOP IS INEQUITABLE AND INEFFICIENT.

OOP LEADS TOFRAGMENTEDRISK, HIGHERCOSTS,IMPOVERISHING

SPENDING, ANDINEQUITY.

PAYMENTS AREAT POINT OFSERVICE, THERE

IS NO PRE-PAYMENT ORRISK-POOLING,AND ABILITY TOPAY IS THECIELING ON

PRICE.

20

40

60

80

Bolivia

Mexico

Peru

France

Germany

PanamaUruguay

ItalyColombia

SpainCosta Rica

ArgentinaChile

VenezuelaBrazil Korea

ThailandMalaysia

Paraguay

EthiopiaEl Salvador

Congo

China

Vietnam

India

%O

OP

LAC

OECD

GDP per capita vs. OOPas a % of healthsystem finance

GDP per capita


15/23

55 53

144

Overall performance

Level of health

ResponsivenessFair financing

HENCE, MEXICOS POOR RANK IN

FAIRNESS OF FINANCING IN THE W.H.O. (2000)

EVALUATION OF HEALTH SYSTEM PERFORMANCE.

Source: WHO, 2000.

61

WHY? : BEFORE THE 2003 REFORM,

ACCESS TO INSURANCE AND HEALTH

CARE WAS SEVERELY SEGMENTED BY

POPULATION GROUP

Th i id f b l t d l ti


16/23

Relative (more than 30% of disposable income): 3.4%

3.8%Absolute (pushed below the poverty

line or deeper into poverty):

The incidence of absolute and relative

impoverishment from health spending is higher

among the uninsured and the poor, 2000.

Absolute and/or relative: 6.3%1.5 million families per trimester

Insured: 2.2%

Uninsured: 9.6%

Poorest quintile: 19.6%910,000 familiesQuintiles 2,3,4 and 5: 3.1%

In the poorest quintile, 2/3 of families are below the povertyline and spend less than 30% of disposable income, and

22% cross the poverty line due to health spending.


17/23

Before the reform, public insurance coverage in Mexico

was limited to social security which was highly inequitableand regressive: by state, health needs, and by income.

Source: Authors own estimation using data from the 2000 Census;ENIGH, 2000; and Salud: Mxico 2002, Ssa (2003).

Insurance coverage by quintile

20%

60%

100%

I II IV V TOTALIII

Uninsured Insured

Epidemiological backlog(mortality rate)

48 a 68

69 a 95

96 a 195

rate X 10,000

51 a 7035 a 50

18 a 49

% Covered by Social Security

Distribution of federal funds:

2.4 times more for the insured

55% uninsured


18/23

Mexico: Research Questions

End

ogeneit

y

1. What is theprevalence of

catastrophic andimpoverishing health

spending?

2. What are thedeterminants of

catastrophic andimpoverishing healthspending? Population

groups in need of

protection, policy levers


19/23

Catastrophicspending in health:

Simple indicator(Den. Spending

total-food) at 30%

2.82.4

Impoverishingspending in health:Newly poor + poor

from healthexpenditures>0 (LP

one dollar PPP)

4.2

1.0Catastrophic and/or

impoverishingexpenditure:

Wagstaff et al.

indicator

6.0

3.1

1992 20080

2

4

6

%of

households

Evolution of Catastrophic and ImpoverishingHealth Spending. Mxico, 1992 to 2008


20/23

Determinants: HH catastrophic or impoverishinghealth expenditure (Mexico, 1992-2008)

Catastrophic

expenditure k=30%

Impoverishing

expenditure1992-2008 1992-2008

Household insurance

Social Security -0.749 0.413

Seguro Popular -0.118 0.352

Composition of HouseholdWith >65 years 0.625 0.209

With


21/23

Next Steps: LaNET + GHNE

Analyze financial protection through tracer diseases:cancer (breast), diabetes, HIV/AIDs

Link financial and non-financial dimensions of equityand interventions

Explore other dimensions of financial vulnerability toshocks in health (Access to care, Loss of income)

GHNE:

Cross-country and regional comparative analysis ofimpact of financial reforms and UHC

Cross-country and cross-region capacity building

Advocacy through evidence to contribute to the UN

work on UHC


22/23

July, 2011

Felicia Knaul

and the Research inHealth Financing

Latin American Network

(RHF-LANET)

Health financing andsocial protection in

Latin America and theCaribbean

UCR


23/23

LLR

Pseudo R2

N

Argentina

-0.0070.0330.0300.0210.014

0.0790.0390.010

0.021-5352

0.096729031

Brazil

0.0090.0270.0240.0180.0150.043-0.0070.010-0.004

-5434.70.068648470

Chile

-0.081-0.061

0.1500.209

-1823.90.0504

4539

Colombia

0.030-0.006-0.006

0.021

-0.019-1642.20.057916442

Costa Rica

-0.003

-0.003

0.013

-112.60.0976

3779

Guatemala

0.038-0.117-0.082-0.064-0.0290.0260.1250.108

0.026-0.055

-4787.40.049613686

Mexico

0.010-0.013-0.010-0.005-0.0040.0120.0400.0500.011

-0.016-2953.13

0.073129468

Peru

0.028-0.035-0.023-0.016

0.0350.048

-0.006-0.023

-3980.70.039420577

Ecuador

0.051-0.015

0.016

0.0160.0990.0540.032-0.018-0.020

-3556.1540.0613581

Nicaragua

0.083-0.059-0.026

0.1260.086

0.025-0.049

-2347.424263.77

6882

Variables in the model

Household

Size

Insurance With insurance

QuintileI

QuintileII

QuintileIVWith seniors

With children

QuintileIII

With seniors

and children

1-2 people

with 5 +

RuralResidence zone

Level of

poverty

Household

composition

Econometric Analysis:

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Depth of Financial Risk Portection in Latin American Health Systems and Role of Health Systems...

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