[Payment systems for health care providers in Latin America and OECD countries]. / Sistemas de pago a prestadores de servicios de salud en países de América Latina y de la OCDE.

The system used to pay health services providers is one of the most important components of the contractual relationship between persons who receive health services and the individual practitioners and institutions that provide those services. That payment system is also relevant in assessing a health system, including its efficiency and quality. In this article we present a simple analytical framework for various payment systems. We also provide an overview of the payment approaches used in two groups of countries whose experiences we consider representative: 10 nations of the Organization for Economic Cooperation and Development (OECD) and four countries of Latin America. We present a basic model to characterize the different forms of payment based on two dimensions. One of the dimensions is the payment "unit," which is used to measure the amount of health care services provided or promised. The other dimension is the distribution of financial risks between the service provider and the service purchaser. Each payment system has advantages and disadvantages that should be evaluated in relation to the intended objectives. On one extreme of the approaches is fixed remuneration, without any adjustments; it represents the purest prepayment approach. One example of fixed remuneration is capitated payment, in which providers carry all the financial risks coming from the variability in the cost of providing services. On the other extreme is fee-for-service payment, where service providers are not at financial risk; the insurer or other financing institution carries all the risk from variable costs. Neither of the extremes appears to be the best choice, and so the issue becomes one of selecting a remuneration system that falls between those extremes. Therefore, it is necessary to choose, on the one hand, the optimal payment unit according to the objectives of the financing entity and, on the other hand, a risk distribution approach that allocates to the service provider the risks coming from greater or less efficiency in delivering services.

The role of government in health insurance markets with adverse selection.

This paper analyzes the welfare economics of three arrangements for purchasing health insurance: competitive markets in which consumers are free to choose among options with different levels of coverage and prices; systems with compulsory partial pooling which permit private firms to sell supplementary coverage; and government-run pools that purchase comprehensive coverage at a single price for all consumers. Competitive insurance markets are assumed to face the problem of 'adverse selection'. This refers to a situation in which the insurer cannot observe characteristics of individuals that affect the cost of insurance and that are known to the individuals. Competitive markets with adverse selection are not efficient because low risks cannot purchase comprehensive insurance coverage. However, government-run pools with comprehensive coverage are an inefficient solution to the problem of adverse selection. Compulsory partial coverage may represent an attractive alternative to both competitive markets and comprehensive pools. We discover two situations when government intervention of this type will succeed: when there are not many high risks in the population, and when the risk types are similar. We discuss the implications of these results for health insurance programs in several countries. Our results also have implications for the allocation of public funds for disease-prevention projects. A project targeted at high risks will produce external benefits for low risks, even though they are not directly affected by the program. However, a successful project might eliminate the market for private insurance; in this case the government should consider mandating partial insurance coverage.

Reimbursing insurance carriers: the case of 'MUFACE' in the Spanish health care system.

This article aims at contributing to the analysis of financial incentives in managed competition, on the basis of the literature on procurement and regulation under incomplete information. More specifically, we focus on MUFACE, the publicly funded health care system for Spanish civil servants and dependants. MUFACE makes up an internal market, where competing public and private insurers are reimbursed a flat capitation payment. Some of our results are that theoretically, both pre-contractual (adverse) selection of insurers contracted by MUFACE, and post-contractual risk selection of enrollees undertaken by insurers, should occur under flat capitation.