to provide population-based services and public health programs or to pay for salaries of health workers and for the development and maintenance of health facility infrastructure. Spending targets for health: no magic number. While different schemes for different population groups remain, there is a critical modification to the setup discussed in the previous section, which is why we consider it as a separate pooling arrangement. 2016;15:57. Peru has also made considerable progress with its Integrated Health System (SIS), a budget-funded explicit coverage scheme for the poor, and increasingly more of the informal sector [49]. Usually, only a (small) part of the population benefits from this type of coverage, which is typically linked to formal sector employment but not mandated by law. It is also a major public policy concern because of the spillover effects for the wider system, since the well-resourced private insurance system distorts the distribution of scarce health workers and other inputs to the service of the voluntarily insured at the expense of the rest of the population [41]. Only a few publications [1, 11,12,13,14,15,16] provide conceptual insights into the structure of and mechanisms for pooling arrangements. Thailand is a prominent example for this pooling arrangement. health financing functions and objectives . There are some countries that rely predominantly on a single national pool funded from general government revenues. Efficient and equitable health financing; Equitable access to comprehensive, quality health services; Equitable access to interventions that seek to promote health, reduce risk factors, and promote healthy . For example, the pool from which the national capital city funds its city hospitals, and the pool from which the central government funds national tertiary facilities are not territorially distinct, particularly when as is often the case the national tertiary hospital is also an important provider of more basic services for the local population. But the key concern is that the existence of multiple pools implies fragmentation. the mobilization of resources for the health sector; 2) pooling, i.e. Kutzin J, Jakab M, Shishkin S. From scheme to system: social health insurance funds and the transformation of health financing in Kyrgyzstan and Moldova. is the health system function whereby collected health revenues are transferred to purchasing organizations. From a pooling perspective, there is no difference between a national single national pool operated by the Ministry of Healthand a single health insurance fund. CAS Soors W, Devadasan N, Durairaj V, Criel B. Such a pool provides compulsory or automatic coverage for the entire population, usually for a defined package of services. Open Access This article is distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution, and reproduction in any medium, provided you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license, and indicate if changes were made. Management has five main functions: planning, organising, leading, coordinating and control. 2001;56(3):171204. While we believe that the classifications are useful, they are not a substitute for the detailed work that is needed in any one specific country to fully understand its pooling arrangements, their links to other health financing and system functions and their implications for policy. hmo6 2017;17(1):145. However, in most countries with complementary or supplementary VHI, VHI expenditure is below 10% of current health expenditure [29], and when a large part of the population has this form of VHI coverage, spillover effects are less severe [22, 53]. are deemed to be particularly problematic forms of fragmentation, because they strongly constrain redistributive capacity. Kutzin J. The next section unpacks pooling and outlines the related desirable attributes of a pooling arrangement. The Canada health transfer: changes to provincial allocations. The result is that even where it is legally mandatory for the entire population, it is de facto voluntary coverage. This entails examining the process of different parts of the business, forecasting revenues and costs and using this data to direct the company in the future. As a consequence of this de facto voluntary arrangement, countries such as Ghana, the Philippines and Vietnam still experience inequities between the insured and uninsured population [34, 44]. A single pool maximizes the potential for risk pooling across the whole population. In 2005/2006 public, external and private contributions to the total health expenditure were 21.6%, 60.7% and 18.2% respectively. An additional layer of complexity is that in many countries several forms of fragmentation exist. Health system review: Achievements and challenges. fragmented systems with voluntary health insurance, duplicating publicly financed coverage; and (8.) PubMed 2019;97:33548. All remaining errors are with the authors. 2012;380(9849):125979. 0000006049 00000 n
OECD, World Health Organization. Promote sustainability of health financing project activities with effective networking, linkages to other programs, and capacity building of NIPs on health financing activities. 2019, 5/393(10166):75102. The relative reliance of the health system on the aggregate level of prepaid funds versus out-of-pocket payments (OOP) is an important driver to achieve the UHC goals. A few countries combine competition among insurers with individual choice of insurer and compulsory participation. These tend to reflect particular challenges due to the nature and consequences of fragmentation in each. Raising and channeling funds: Working Group 2 report, 2009. Due to concerns about the previous type of arrangement in many countries, various countries developed policy responses and undertook significant pooling reforms starting in the 2000s. As the name suggests, it exists in addition to and along the other main pooling arrangements, as outlined above. This is a protocol of a study that will aim to assess health financing system progress towards achieving UHC in Iran. 0000002097 00000 n
A territorially distinct pool serves the people living in that territory [11]. (WHO/HIS/HGF/HFWorkingPaper/16.1; Health Financing Working Paper No. endstream
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Analysis was performed in line with the various NHA entities and health system financing functions. Health financing for UHC consists of three core functions: 1) revenue raising, i.e. They also need to monitor cash on hand, businesses may be profitable but have a shortage of cash and. Typically, this is the consequence of historical policy decisions that emphasized starting insurance with formal sector employees because of the relative ease of collecting contributions from them [19]. 0000002548 00000 n
FDA Staff Manual Guides, Volume I - Organizations and Functions . Geneva: World Health Organization; 2010. Mexicos Seguro Popular also shifted to this principle of automatic coverage of all people who are not part of an insurance scheme for formal sector employees [47, 48]. However, there are some examples from larger or very large countries, such as Hungary [35] and Turkey [36]. However, little is known about how best to monitor health financing system progress towards UHC, especially in low- and middle-income countries. Some countries, such as Rwanda and Ghana, have transformed their earlier CBHI model, which no longer falls under VHI. For example, district governments only pool for ambulatory care and district level hospitals, provinces for provincial hospitals, and the national government for high-level tertiary services. When coverage is compulsory or automatic for all population groups, the pool(s) have a more diverse mix of health risks. type of pooling arrangement, namely territorially distinct pools. Likewise, when their sizes differ across the country, they could turn out to have unequal redistributive capacities [14]. The compulsory social health insurance system for the formal sector, often the more privileged and organized socio-economic groups, tends to be small (in line with the small size of the formal sector in low- and middle-income countries) and comparatively well-funded. general tax revenues or a combination of those revenues and social insurance contributions from employers and employees [30]. Although all health financing functions play an important role in ensuring finan-cial protection, risk pooling and prepaymentwhether through taxes or individual premiumsplay the central and often the most poorly understood roles. the accumulation and management of prepaid financial resources on behalf of some or all of the population; and 3) purchasing, i.e. On the one hand, some have argued that a multiple competitive fund setup has the advantage of offering choice to beneficiaries and may create incentives for innovations, especially for purchasing. Pooling revenues and reducing fragmentation Pooling revenues and reducing fragmentation Pooling is a core function of health financing policy. 0000035307 00000 n
Three key health financing system functions Resource Mobilization: Countries need to consider three issues: What are the sources of funding for health? The finance department functions like bookkeeping, budgeting, forecasting, and management of taxes, and the finance manager functions like financial report preparations contribute to the overall financial wellbeing of an entity. Health financing is a core function of health systems that can enable progress towards universal health coverage by improving effective service coverage and financial protection. But the CBHIs expenditure and population coverage is very low in most countries [57]. In turn, this can help countries assess their pooling arrangements and contribute to identifying policy options to address fragmentation or mitigate its consequences. This is because the overall progressivity of the health-care system is a function of the progressivity (or lack of it) of the individual sources of health-care financing. Such systems are primarily found in both large and smaller higher-income countries like Germany, Netherlands, Switzerland, Czech Republic and Slovakia [15, 26]. Higher income persons are usually more likely to have this form of VHI [51]. Many others receive poor quality of services even when they pay out-of-pocket. In particular, the aim in both is to match the level of per capita funding of each pool with the relative health risk of the population affiliated to each pool. Conversely, pools with higher health risks are more likely to restrict benefits (if this is legally allowed), face financial difficulties or else run deficits. Article Fragmentation is further aggravated, as a small part of the better-off population is often enrolled in commercial voluntary health insurance, whilst a small share of people in the informal sector may enroll in voluntary community-based health insurance schemes [41, 42]. Conversely, there is no population segmentation when coverage and participation in a pool is independent of peoples socio-economic or (socio-)demographic criteria. Ministry of Health Swaziland. Multiple forms of fragmentation co-exist, and dimensions other than pooling also result in fragmentation. 6. IM, PS and JK developed the outline and framework. Geneva: World Health Organization; 2019. 2S?dI9c{rP"=-Gsi1NU@ 154 39
Washington DC: World Bank; 2006. But services are typically grossly underfunded and often unavailable, thus resulting in implicit benefits [1]. volume18, Articlenumber:198 (2019) Part of 1997;41:136. the mobilization of resources for the health sector; 2) pooling, i.e. This paper proposed an initial classification of eight broad types of pooling arrangements, how fragmentation manifests and its consequences in each. Health Systems Financing: The path to universal coverage. Results The Kenyan health sector relies heavily on out-of-pocket payments. Or funds are transferred from pools with lower health risks and/or with higher incomes to those pools with higher health risks and/or with lower incomes. Advances in health economics and health services research, volume 21. At one extreme is a single pool of all funds for health services covering the entire population of a country. 0000008860 00000 n
Pooling arrangements in health financing systems: a proposed classification, International Journal for Equity in Health, https://doi.org/10.1186/s12939-019-1088-x, http://www.internationalhealthpartnership.net//CMS_files/documents/working_group_2_report:_raising_and_channeling_funds_EN.pdf, http://www.nationalplanningcycles.org/sites/default/files/planning_cycle_repository/swaziland/swaziland_nhssp_ii_draft_zero_29_aug_2014.pdf, http://siteresources.worldbank.org/HEALTHNUTRITIONANDPOPULATION/Images/MexicanSocialProtectionSysteminHealth.pdf, https://www.academia.edu/33391064/The_Health_Insurance_System_in_Peru_Towards_a_Universal_Health_Insurance, https://www.service-public.fr/professionnels-entreprises/vosdroits/F33754, http://creativecommons.org/licenses/by/4.0/, http://creativecommons.org/publicdomain/zero/1.0/. there are different funds for different population groups, with the affiliation being based on socio-economic or (socio-) demographic criteria. But a system with territorially distinct pools can suffer from fragmentation, if and when their population size or the territory are too small to ensure redistributive capacity, or when sub-national territories have very different levels of average per capita expenditure on health. Geneva: World Health Organization; 2016. What are the types of health care financing? It concentrates on patient flows as well as the organization and delivery of all services dealing with the diagnosis and treatment of disease, or the promotion, maintenance and restoration of health. Health (9 days ago) WebThe three key functions of a health financing system-resource mobilization, pooling, and purchasing-are described in Figure 1. 0
a single pool; (2.)
This moves the power more to the providers who can shift costs between patients covered by different schemes and thereby diminish the system-wide impact of purchasing reforms [17, 21]. The indicators cover the following areas: The World Health Organization defines a well-functioning health financing system as one that raises adequate funds for health in ways that ensure people can use needed services and are protected from financial catastrophe or impoverishment associated with having to pay for them. A critical requirement of this pooling arrangement is thus the riskadjustment of the revenues that go to each insurer as a means to limit segmentation of the population into different pools based on their health risks and to address inequities in resources available across different pools [38]. territorially overlapping pools in terms of service and population coverage; (4.) Washington DC: World Bank; 2006. 0000001076 00000 n
Google Scholar. It is possible to have competition across pools, i.e. Book Frenk J. In any country, prepaid health revenues may be held, i.e. Paris: OECD; 2011. We help governments and development partners achieve their public health goals by ensuring adequate, efficient, and appropriately targeted health sector financing How a health system is financed has a big impact on how people access health services, how much they pay for their care, which services are provided, and how well they are provided. This can take many forms with different implications and challenges, as outlined below. 0000011158 00000 n
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I,dH4BH>o\v^dqY[GraltAL3,;S/R-{zk37IY[?d-. The paper is based on a review of published and grey literature in PubMed, Google and Google Scholar and our information gathered from our professional work in countries on health financing policies. In: Chernichovsky D, Hanson K, editors. OECD reviews of health systems: Switzerland 2011. Sagan A, Thomson S. Voluntary health insurance in Europe: country experience. This chapter provides background on demographic and epidemiological trends, the configuration of Ghana's health system, and health financing functions and health systems goals. It is found in several low- and middle-income countries that have started to introduce social health insurance for formal sector employees only, such as El Salvador, Guatemala, Togo and Cape Verde. Library of Parliamentarians: Ottawa; 2011. The set of performance indicators provided in this article should help policy makers to monitor the development of social health insurance schemes and identify areas for improvement. <]>>
"Health system financing is an essential component of UHC but progress toward UHC also requires coordinated actions across the pillars of the health system with particular attention to strengthening human resources for health." Health system financing health topic
Then, within each health financing function, key performance issues and associated measurable indicators are developed. Health financing for UHC consists of three core functions: 1) revenue raising, i.e. Its main purpose is to share the financial risk associated with Key facts Health system review. 2018;122:45772. voluntary contributions from beneficiaries, are prone to adverse selection: people with higher risks are more likely to enroll than people with lower health risks. 799 0 obj
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This is followed by an outlineof the key institutional design aspects of pooling arrangements and how these can create fragmentation. Risk pooling is the spreading of the financial risk associated with the need to use and pay for health services, rather than to be fully borne by the individual who falls ill [11].The objectives of this paper are to raise the profile of pooling as a health financing policy instrument and to provide a simple classification of country pooling arrangements through which we discuss the challenges typically associated with how fragmentation manifests in each setting. Each financing mechanism was analysed in respect to key functions namely, revenue generation, pooling and purchasing. 0000079954 00000 n
Geneva: World Health Organization; 2008. to (5.) Such pooling setups create explicitly unequal financing arrangements and the population segmentation is often further linked with separate purchasing and service provision arrangements. 2. 1970;84(3):488500. Among the eight types of pooling arrangements, types (3.) In doing so, policy makers can come closer . First, there are higher administrative costs of having multiple pooling/purchasing agencies rather than one, which can raise system-wide costs. As you know, there is a lot that you can find. Cutler DM, Zeckhauser RJ. Anyone you share the following link with will be able to read this content: Sorry, a shareable link is not currently available for this article. Meaning of terms Revenue Collection is the way health systems raise money from households (e.g. 154 0 obj <>
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Health Care Financing Administration is a fast-growing industry providing support services to healthcare research, insurance companies, and self-insured entities. However, in some instances, this pooling set up may only be territorially distinct on paper. A conclusion and lessons are presentedat the end. Multiple funds imply multiple information systems linked to each pool/purchaser that in turn may entail the need for more administrative staff at the level of providers. OECD, Eurostat. 0000074834 00000 n
5. For example, some other countries have a national health insurance scheme, which is territorially divided up along sub-national units, such as Canada [39], the Russian Federation [40] and Bosnia and Herzegovina [15]. WHO Regional Office for Europe: Copenhagen; 2016. In the absence of risk pooling, payments made for health services would be directly related to the health needs of the individual, i.e. 2007;83(23):16279. Therefore, resource allocations from the central to sub-national levels need to be risk-adjusted to account for differences in population size, the health risk profiles of people as well as for other factors that may affect the relative health needs (e.g. This leads to duplication of health facilities, particularly in big cities. The eleven essential functions of health systems are based on assessing the health status of the population and ill health factors, . Health Financing. This paper attempts to address this problem by providing a conceptual framework that is driven by the normative objective of enhancing the 'insurance function' (access to needed care without financial impoverishment) of health care systems. Innovations in Health System Finance in Developing and Transitional Economies. An appraisal of the health transformation Programme. Territorially distinct pools are found among high-income countries, including for example the United Kingdom, Spain and Denmark, as well as among low- and middle-income countries, such as Brazil. 2016;18(2):1239. 192 0 obj<>stream
Risk pooling effectively means that the healthy subsidize the sick, and by implication due to their lower health risks, the young subsidize the old [14]. Background paper no. Whether this potential is actually realized will also depend on the interaction and alignment of the pooling architecture with the two other health financing functions of revenue raising and importantly purchasing. Geneva: World Health Organization; 2017. Google Scholar. 3. Cuba, with a much larger population, also has this setup, as does Sri Lanka, where financial protection performance is relatively good despite a high share of OOP [29]. U;c!=(i\s PubMed Central A 2 0
Knaul FM, Gonzlez-Pier E, Gmez-Dants O, Garca-Junco D, Arreola-Ornelas H, Barraza-Llorns M, Sandoval R, Caballero F, Hernndez-Avila M, Juan M, Kershenobich D, Nigenda G, Ruelas E, Seplveda J, Tapia R, Sobern G, Chertorivski S, Frenk J. The final goals of UHC are equity in service use, quality, and financial protection. Cookies policy. 0000002345 00000 n
Over time, the result is that benefits are curtailed for those who need them most, while fewer and fewer healthier individuals join the scheme. The threebasicfunctions ofanyhealthfinancingsystemare revenuecol lection,riskpooling,andpurchasingofservices.Figure3.1highlightsthese basic functions, together with the basic health system objectives they are designedtoachieve.Countriesneedtofocusnotongenericmodelsbuton healthfinancingfunctions andobjectives andthespecificmicroandmacro Preker A, Langenbrunner J. Health financing is central to the functioning of health systems and the attainment of health-related sustainable development goals, including universal health coverage (UHC). To discuss Malawi as a case study in health systems. 0000000016 00000 n
This mitigates some of the effects of segmentation, though remains often incomplete due to the entrenched power of the initially insured population groups. Taken quite literally, perhaps no country has only one single pool. Health financing - World Health Organization. Latin American development forum. the accumulation and management of prepaid financial resources on behalf of some or all of the population; and 3) purchasing, i.e. PubMedGoogle Scholar. Health financing policy brief no. Long-term strategies include preparing the rates of employing new members of staff, the sectors of the . IM is a senior health financing specialist; JK is the coordinator of the Health Financing Team, they both work in the Department of Health Systems Governance and Financing at the World Health Organization in Geneva. The complex structure of Australia's . Google Scholar. Int J Equity Health. Kutzin J, Yip W, Cashin C. Alternative financing strategies for universal health coverage. Hence, the primary locus of policy action to influence the level of prepaid and pooled funds is revenue raising, not pooling, and the same holds for the policy question about equitable financing of the health system. A Review of the National Health Insurance Scheme in Ghana: What Are the Sustainability Threats and Prospects? . Health Care Syst Transit. ), (7.) World Health Organization. Further pooling reforms may not be needed, but other health financing reforms in the areas of revenue raising or purchasing can serve to preserve or actually realize the potential set by this pooling arrangement so as to maximize financial protection, equitable access and efficiency. Mathauer, I., Saksena, P. & Kutzin, J. Pooling arrangements in health financing systems: a proposed classification. 1.2.1. BMC Health Serv Res. The function of pooling and the ways that countries organize this is critical for countries progress towards universal health coverage, but its potential as a policy instrument has not received much attention. Springer Nature. The major health financing mechanisms in Nigeria are namely: (i) government budget using general tax revenue; (ii) direct out-of-pocket payments; (iii) a social insurance scheme known as the Formal Sector Social Health Insurance Programme (FSSHIP) that is implemented by the National health insurance scheme; and (iv) donor funding. Health financing has three key functions: revenue collection, pooling of resources, and purchasing of services. Risk selection negatively affects the redistributive capacity, as healthier and wealthier individuals and their contributions often end up in a different pool than poorer and sicker members with (usually) lower contributions. Prakongsai P, Limwattananon S, Tangcharoensathien V. The equity impact of the universal coverage policy: lessons from Thailand. Explain the need for evidence pertaining to the cost of delivery of. Finally, there may be specific coverage schemes for defined population groups, such as the poor [30]. World Health Report 2010 Technical Brief Series - Technical Brief No. Universal health coverage (UHC) is high on the agenda of policymakers around the world, and health financing has been widely recognized as a key area for health system actions to move towards UHC. 0000003940 00000 n
However, we recognize that any classification is a simplification of reality and does not substitute for a country-specific analysis of pooling arrangements. Indonesia is also undertaking efforts to shift towards a single national health insurance pool, but there is still a significant part of the population that is not yet enrolled in the pool. In: Figueras J, editor. Health Policy. The purpose of pooling is to spread financial risk across the population so that no individual carries the full burden of paying for health care. Health financing systems have a key role in achieving universal health coverage (UHC) across the globe. Gottret P, Schieber G. A practitioners guide health financing revisited. Health financing: the basics FP Financing Roadmap. The six functions are: (i) service delivery, (ii) medical products, vaccines and technology, (iii) workforce, (iv) information, (v) financing and (vi) leadership and governance. Health financing diagnostics & guidance no. These countries had therefore decided to create an explicit coverage program for people outside the formal sector, whilst trying to gradually increase the level of funding to narrow the gap in per capita expenditure across the different schemes. 0000080000 00000 n
basic functions, together with the basic health system objectives they aredesigned to achieve. Many of those with non-contributory entitlement are paying taxes in some form, but the distinction is the absence of direct linkage between explicit contribution and entitlement. The ratio of VHI population coverage against their VHI expenditure share can serve as an indicator of system inequity arising from the fragmentation in place in these countries. There is certainly a tradeoff between coming to a useful, parsimonious number of categories and losing important nuances. Kutzin J. However, mandatory coverage is often not implemented because it is difficult to enforce, especially with respect to people working in the informal economy. [http://www.internationalhealthpartnership.net//CMS_files/documents/working_group_2_report:_raising_and_channeling_funds_EN.pdf, accessed 6 July 2010)]. Under the second form of institutional setup, countries have established a single national fund that is managed by a separate pooling and purchasing agency, usually with a purchaser-provider split. SMG 1117A.641 . 'p 6l3/%J The report is divided into five chapters. Based on WHO's health systems framework, the different functions of health financing policy, namely revenue raising, pooling, purchasing, and benefit package design, are each discussed in detail with extensive country illustrations. 0
View below: When viewing on a desktop, maximize for optimized view. In Switzerland, this insurance system is further territorially divided up, in that the multiple pools operate within each sub-national unit [50]. We also like to thank Lisa Seidelmann, Carlo Schmid Fellow and volunteer with the Department of Health Systems Governance and Financing at the time of producing this draft for her research assistance. The quest for universal health coverage: achieving social protection for all in Mexico. %%EOF
In contrast, the public budget through the Ministry of Health offers theoretically free health services for the rest of the population. Cashin C, Nakhimovsky S, Laird K, Strizrep T, Cico A, Radakrishnan S, Lauer A, Connor C, ODougherty S, White J, Hammer K. Strategic health purchasing Progress: a framework for policymakers and practitioners. As you can see, out-of-pocket or fee-for-service, government budget, or insurance agencies are all means of purchasing health care from providers.