Innovative EU Support to Health Financing Reforms

Development and Cooperation - EuropeAid

Innovative EU Support to Health Financing Reforms

Dr. Christopher Knauth, MCommHHealth Sector, Southern and Eastern Africa Unit

Development and Cooperation – EuropeAid

European Commission


IntroductionThe health systems of the European Union are a central

part of Europe's high levels of social protection, and contribute to social cohesion and social justice as well

as to sustainable development. The overarching values of universality, access to good quality care, equity, and solidarity have been widely accepted in the work of the different EU institutions. Together they constitute a set

of values that are shared across Europe. Council 2006, Council Conclusions on Common values and principles in EU Health Systems 2733rd

EMPLOYMENT, SOCIAL POLICY, HEALTH and CONSUMER AFFAIRS Council meeting


Introduction

EU partnership and dialogue with third countries will promote common values of: respect for human rights, fundamental

freedoms, peace, democracy, good governance, gender equality, the rule of

law, solidarity and justice.

The European Consensus on Development, European Council 15-16 Dec 2005, signed by Presidents Barroso, Borrell, Blair 20 Dec 2005


Overview

1. Health Co-operation Policies 2000-10 on fair financing

2. Experience of EC support in MIC

3. New Development Policy 2011

4. Opportunities and Perspectives


1. EC Health Co-operation Policies on Fair Financing 2000-10


WHR 2000 : Health System goals

1. Improving health, reducing inequalities

2. Enhancing the responsiveness to the legitimate expectations of the population

3. Assuring fairness of the financial contribution


2002 : COMMUNICATION Health and Poverty Reduction in Developing Countries

1. to improve health, AIDS and population outcomes

2. to maximise health benefits and minimise potential negative health effects of EC support for other sectors;

3. to protect the most vulnerable from poverty through support for equitable and fair health financing mechanisms; and

4. to invest in the development of specific global public goods.


2002 : COMMUNICATION Health and Poverty Reduction in Developing Countries

The expansion of social protection, including fair and equitable financing mechanisms should remove barriers, encourage use of services by the poor and protect them from

the risks of impoverishment due to health expenditure.


2010: COMMUNICATION The EU role in Global Health

• The EU should support third countries efforts to formulate effective policies to mobilise domestic revenues, scale up fair financing of health systems and develop or strengthen social protection mechanisms in the health sector.

• In Developing Countries, replacing of user fees with fair financing mechanisms and compliance with commitments on national budgets' allocation to health should be considered.


PHILIPPINES 2007-2010

2. Experiences of EC support in MIC

“FOUR(4!)mula 1”

1. Health Financing

2. Health Regulation

3. Service Delivery

4. Sector Governance

1.Health Financing1. Mobilising resources from extra budgetary

resources2. Coordination local and national health

spending3. Adopting a performance-base financing

system4. Expanding the national health insurance

program

EC Sector Budget Support

•€ - > Minister of Finance

•Sector policy dialoge•TA

EC Support

HSPSP: 33 Mio EUR

• In average: Fixed tranche 79%, variable tranche 21%

• ECTA

EC Support Health Financing

• ECTA to PhilHealth• Drafting of a Health Financing

Startegy for the Philippines• Variable tranche – extension of

insurance coverage to the poor

HEALTH CARE FINANCING STRATEGY2008-2017

Working paper

Large Income-Related Health Outcome Inequalities0

10

20

30

40

50

60

70

Infa

nt m

ort

alit

y r

ate

Lowest Second Middle Fourth HighestWealth quintile

Infant mortality rate

010

20

30

40

50

60

70

Under-

five m

ort

alit

y r

ate

Lowest Second Middle Fourth HighestWealth quintile

Under-five mortality rate

Source: NDHS 2008

Health outcomes by wealth quintile

Financial Protection is Getting WorseOOP Share of Total Health Spending is

Increasing While the Public Share is Decreasing

This is Counter to the Trend in Neighboring Countries

IndonesiaPhilippines

Sri Lanka

Thailand

India

China

Vietnam

.75

1.25

1.75

2.25

2.75

Publi

c hea

lth sp

endin

g pe

r cap

ita sh

are

of G

DP (%

)

1993 1995 1997 1999 2001 2003 2005 2007Year

Source: WDI (updated as of October 8, 2009)Note: y-axis log scale

Public Health Spending Share of GDP (%) in Selected Comparators (1995-2007)


INCREASING THE IMPACT OF EU DEVELOPMENT POLICY

- AN AGENDA FOR CHANGE –

2. New Development Policy 2011


A fast changing international context

Graduation: increased standards of living, 25 countries recently moved from category (LICs to LMICs or from LMICs to UMICs)

New actors : private sector, private foundations, emerging donors, local authorities;

Population growth : world population to reach 9.3bn by 2050; Africa fastest-growing continent

3 global crises: food prices, oil/energy prices volatility, economic and financial crisis

Economic downturn & budget constraints ‘Arab spring’: importance of good governance and democracy,

employment and growth, security-development nexus brought into sharper focus

Regional vulnerabilities & crises: Horn of Africa (drought/famine)

Strong growth but weak effect on poverty reduction – ref African Economic Outlook Report: 2001-09: 5-6% real GDP /slowdown 2009 3.1%– rebound - projection 5.8% in 2012


Increasing EU impact World’s largest donor Key trading partner Broad and ambitious development policies Comprehensive partnerships

… but we could have even greater impact.

The EU is already making a significant contribution towards the MDGs …

http://ec.europa.eu/europeaid/infopoint/publications/europeaid/documents/188a_mdg_fr.pdf


Fall/ Winter 2010

Cosultation on Issues Paper• Inclusive growth• Sectoral Concentration• Focus on growth related sectors: trade,

agriculture, private sector devnopment• Focus on LICs


Key results from the public consultation

• +240 written responses from wide range of stakeholders, both from the EU and partner countries

• Convergence of views from all stakeholders on:– retaining the poverty focus of EU development policy; implementing EU

commitments (ODA targets, aid effectiveness, PCD)– Importance of inclusive growth for poverty reduction, alongside other

interventions in the fields of governance, health, education, etc..– Desirability of a differentiated approach to partner countries– Importance of capturing and communicating results to secure political and public

support for development– Important role played by the EU in good governance (including participation of

civil society), security, human rights and gender equality– Central role partner countries have to play in helping their own development +

importance of partner country ownership– Encourage private sector engagement, but certain norms and standards (e.g.

decent work) must be respected.

• All contributions + report on the public consultation are online (Commission website)


Communication

'Increasing the impact of EU Development Policy: an Agenda for Change' COM(2011) 637 final

of 13.10.2011


“An Agenda for change”

1. More strategic and more focused portfolio in support of good governance and inclusive and sustainable growth;

2. Greater sectoral concentration at country level;

3. Enhanced importance to human rights, democracy and good governance;

4. Continued support for social inclusion and human development;

5. Greater focus on investing in drivers for growth and job creation;


Policy priorities

Good governance, democracy, human rights Sectors building foundations for inclusive growth

(e.g. social protection, health & education) Drivers for growth and job creation (e.g. business

environment, regional integration) Sectors with strong multiplier impact and

contributing to environmental protection + climate change prevention/adaptation : sustainable agriculture and efficient renewable energy


Social protection, health, education

• More comprehensive approach to human development

• ‘sector reform contracts’ to increase equitable access to quality health and education services

• Promote policy coherence and increase protection against global health threats

• Support decent work agenda, social protection schemes, and regional labour mobility.

• ‘continued support for social inclusion and human development through at least 20%


In preparation : New Communication on Social Protection

The Communication on Social Protection will seek to explain the role of social

protection in underpinning inclusive and sustainable development and the role of

EU development cooperation in supporting the strengthening of social

protection policies and systems


4. Conclusions, Opportunities, Perspectives


4.Opportunities and Perspectives

• EC :Learning form South Africa• EC :Less focus, less money on MIC• Less money, perhaps better focussed

TC• More comprehensive approach towards

health and social protection• EC supporting WHO Action Plan

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Innovative EU Support to Health Financing Reforms

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