An overview of health financing patterns and the way forward in the WHO African Region.

BACKGROUND: The way a health system is financed affects the performance of its other functions of stewardship, input (or resource) creation and services provision, and ultimately, the achievement of health system goals of health improvement (or maintenance), responsiveness to people's non-medical expectations and fair financial contributions. OBJECTIVES: To analyse the changes between 1998 and 2002,in health financing from various sources; and to propose ways of improving the performance of health financing function in the WHO African Region. DESIGN: A retrospective analysis of data obtained from the World Health Report, 2005. METHODS: The analysis reported in this paper is based on the National Health Accounts (NHA) data for the 46 WHO Member States in the African Region. The data were obtained from the World Health Report 2005. It consisted of information on: levels of per capita expenditure on health; total expenditure on health as a percentage of gross domestic product (GDP); general government expenditure on health as a percentage of total expenditure on health; private expenditure on health as a percentage of total expenditure on health; general government expenditure on health as a percentage of total government expenditure; external expenditure as a percentage of total expenditure on health; social security expenditure on health as a percentage of general government expenditure on health; out-of-pocket expenditure as a percentage of private expenditure on health; and private prepaid plans as a percentage of private expenditure on health. The analysis was done using Lotus SmartSuite software. RESULTS: The analysis revealed that: fifteen countries spent less than 4.5% of their GDP on health; forty four countries spent less than 15% of their national annual budget on health; sixty three percent of the governments in the Region spent less than US$10 per person per year; fifty per cent of the total expenditure on health in 24 countries came from government sources; prepaid health financing mechanisms cover only a small proportion of populations in the Region; private spending constituted over 40% of the total expenditure on health in 31; direct out-of-pocket expenditures constituted over 50% of the private health expenditure in 38 countries. CONCLUSION: Every country needs to develop clear pro-poor health financing policy and a comprehensive health financing strategic plan with a clear roadmap of how it plans to transit from the current health financing state dominated by inequitable, catastrophic and impoverishing direct out-of-pocket payments to a visionary scenario of universal coverage. The strategic plan should strengthening of health sector advocacy and health financing capacities, health economics evidence generation and utilisation in decision-making, making better use of available and expected resources, monitoring of equity in financing, strengthening of the exemption mechanisms, managed removal of direct out-of-pocket payments (for countries that choose to), and improving country-led sectoral coordination mechanisms (e.g. Sector Wide Approaches).

An Overview of Health Financing Patterns and the Way Forward in the WHO African Region

The way a health system is financed affects the performance of its other functions of stewardship; input (or resource) creation and services provision; and ultimately; the achievement of health system goals of health improvement (or maintenance); responsiveness to people's non-medical expectations and fair financial contributions. To analyse the changes between 1998 and 2002;in health financing from various sources; and to propose ways of improving the performance of health financing function in the WHO African Region. A retrospective analysis of data obtained from the World Health Report; 2005. The analysis reported in this paper is based on the National Health Accounts (NHA) data for the 46 WHO Member States in the African Region. The data were obtained from the World Health Report 2005. It consisted of information on: levels of per capita expenditure on health; total expenditure on health as a percentage of gross domestic product (GDP); general government expenditure on health as a percentage of total expenditure on health; private expenditure on health as a percentage of total expenditure on health; general government expenditure on health as a percentage of total government expenditure; external expenditure as a percentage of total expenditure on health; social security expenditure on health as a percentage of general government expenditure on health; out-of-pocket expenditure as a percentage of private expenditure on health; and private prepaid plans as a percentage of private expenditure on health. The analysis was done using Lotus SmartSuite software. Results: The analysis revealed that: fifteen countries spent less than 4.5of their GDP on health; forty four countries spent less than 15 of their national annual budget on health; sixty three percent of the governments in the Region spent less than US$10 per person per year; fifty per cent of the total expenditure on health in 24 countries came from government sources; prepaid health financing mechanisms cover only a small proportion of populations in the Region; private spending constituted over 40 of the total expenditure on health in 31; direct out-of-pocket expenditures constituted over 50of the private health expenditure in 38 countries. Every country needs to develop clear pro-poor health financing policy and a comprehensive health financing strategic plan with a clear roadmap of how it plans to transit from the current health financing state dominated by inequitable; catastrophic and impoverishing direct out-of-pocket payments to a visionary scenario of universal coverage. The strategic plan should strengthening of health sector advocacy and health financing capacities; health economics evidence generation and utilisation in decision-making; making better use of available and expected resources; monitoring of equity in financing; strengthening of the exemption mechanisms; managed removal of direct out-of-pocket payments (for countries that choose to); and improving country-led sectoral coordination mechanisms (e.g. Sector Wide Approaches)

Towards advanced risk-sharing in health care financing: with a focus on the potential of social health insurance in developing countries.

In this paper, we analyse the major health financing methods and the contribution they can make to improving access to health care among all of a country's population groups. Risk-sharing in health financing is proposed as a powerful method to achieve this improvement. The larger the degree of risk-sharing in a health financing system, the less people will have to bear the financial consequences of their own health risks, and the more they are likely to have access to needed care. Ideally countries should attempt to introduce 'advanced' risk-sharing aiming at equal access among individuals to an adequate package of health services. There are two major ways to implement advanced risk-sharing: general tax revenue may be main source of financing health services, or else social health insurance may be established. An important finding is that about 60% of the world's countries still need to pursue efforts towards the introduction of advanced risk-sharing. We further focus on the potential of social health insurance as an advanced risk-sharing method. In fact, there is recent interest in developing countries such as Côte d'Ivoire, Indonesia, Iran and Kenya in this particular health financing mechanism. Compared to health financing via general tax revenue, social health insurance spreads the immediate burden of financing among various groups, including the workers, the self-employed, enterprises and Government. Time and tedious discussions between these groups may be needed, however, before a consensus is reached, not only on the relative burden of financing but also on ways to achieve overall population coverage. It is suggested that action-research be used to test the adequacy of initial social health insurance policies.

[Challenges to Latin-American health systems: what can be learned from the European experience?]. / Retos para los sistemas sanitarios de Latinoamérica: qué puede aprenderse de la experiencia europea?

This article compares the challenges of health systems in Latin America and the experience in Europe. The framework is the analysis of four functions: a) to generate resources; b) to produce activities; c) to finance, and d) to exercise stewardship. It is at this level where actors can influence health system responsiveness. Five challenges are identified in Latin America: a) to extend (prepayment and solidarity) financial protection; b) to stabilise that protection for crisis times; c) to equilibrate resources in accordance to capacity for financing services; d) to increase efficiency (technical and of placement) to produce services, and e) to improve the stewardship function in public and private sectors (the most important and difficult challenge Latin-American systems have nowadays). The experience of reform in Europe is analysed, showing: a) experiences about financial protection in Beveridge and Bismarck systems; b) stability in crisis times, recently confirm (West) and with important obstacles (East); c) efforts to equilibrate hospital beds and health care professionals, combining regulation and incentives; d) increase of efficiency in services production, with more express prioritisation, empowering patients, decentralising management and with market incentives, and e) improvement of stewardship with better (not less, sometimes even more) regulation. Three areas of European experience stand out: a) to combine solidarity with financial sustainability; b) to introduce market incentives in a measured way, but maintaining a clear stewardship role for the state, and c) to adopt innovations in organising and producing services. In spite of methodological difficulties, convergence of challenges and adopted solutions justify this analysis, but learning must be seen in each national context. A future article will analyse lessons offered by reform in Latin-American systems for European reforms.

Retos para los sistemas sanitarios de latinoamérica: ¿qué puede aprenderse de la experiencia europea? / Challenges to Latin-American health systems: what can be learned from the European experience?

Este artículo compara los retos de los sistemas sanitarios latinoamericanos y la experiencia en Europa. El marco conceptual se centra en cuatro funciones: a) generar recursos; b) producir intervenciones; c) financiar, y d) 'ejercer rectoría'. Es a este nivel donde los actores pueden influir sobre el desempeño del sistema. Se identifican cinco retos para Latinoamérica: a) extender (prepago y solidaridad) la protección financiera; b) estabilizar en el tiempo dicha protección para épocas de crisis; c) equilibrar los recursos coherentemente con la capacidad de financiar servicios, d) aumentar la eficiencia ubicativa y técnica al producir servicios, y e) mejorar la función de rectoría de las demás funciones en los sectores público y privado (el más difícil y más importante reto hoy para los sistemas latinoamericanos).Se analiza luego la experiencia de reforma en Europa, presentando: a) experiencias sobre protección financiera en los sistemas tipo Beveridge y Bismarck; b) estabilidad en tiempos de crisis refrendada recientemente (Oeste) y con graves obstáculos (Este); c) el esfuerzo por equilibrar camas hospitalarias y profesionales sanitarios combinando regulación e incentivos; d) un aumento de la eficiencia en la producción de servicios priorizando más expresamente, dando voz a los pacientes, descentralizando la gestión y con incentivos de mercado, y e) una mejora de la rectoría no regulando menos sino mejor (y en algunos casos, más).Tres áreas de la experiencia europea sobresalen: a) combinar solidaridad con sostenibilidad financiera; b) introducir mesuradamente incentivos de mercado pero manteniendo un claro papel rector del Estado, y c) adoptar innovaciones en la organizacíon y producción de servicios. Pese a las dificultades metodológicas, la convergencia de los retos y las 'soluciones' adoptadas justifica este análisis, pero las enseñanzas deben contemplarse desde cada contexto nacional. Un futuro artículo abordará las lecciones ofrecidas por las reformas de los sistemas latinoamericanos a las reformas europeas (AU)

The reform of the rural cooperative medical system in the People's Republic of China: interim experience in 14 pilot counties.

During the 1960's and 1970's the Chinese government encouraged the 'rural cooperative medical systems' (RCMS), in order to ensure access to basic health care among the rural population. There was a break in the development of the RCMS in the early 1980's, as a consequence of market economic reforms. These reforms involved a shift from a communal to a household production system. As a result the collective way of financing rural health care was more or less abandoned. However, the government of the People's Republic of China was aware of the need to provide social protection against health care expenses. In March 1994 the government initiated a project to reestablish the RCMS. This project was implemented on a pilot basis in 14 counties of seven provinces. The reestablishment of the RCMS would be guided by the basic principles of health insurance. In October 1995, a first mid-term evaluation of the RCMS Project was held. One of the major research questions concerned the extent to which the RCMS had reduced the risk of paying health care bills that would otherwise be a burden on families. This article addresses this question and assesses the results obtained after two years of RCMS experimental work. A general finding is that the population structure by occupation and income varies, and that the RCMS has adapted itself to this variety. It is also confirmed that the burden of health care costs on families was reduced, more so in some counties than in others, but this reduction has been modest. The research results indicate that there is ample room for improvement. The outlook is hopeful, however. At the national level, there is now systematic thinking about RCMS. The current RCMS work is also having a considerable influence on other counties that are keen to reestablish the RCMS.

Coping with ill health in a rickshaw puller's household in Chittagong, Bangladesh.

The correlation between poverty and ill-health is undeniably strong. Ill-health reduces the earning capacity, and increases the risk of families with ill members to drift down the social and economic ladder. In this article, we present a simulation model of how a poor rickshaw puller in Bangladesh copes with illness, in particular tuberculosis (TB). We first analyze the various coping mechanisms that are set in motion when he starts to suffer from tuberculosis; the impact on household assets, income and food intake will be studied. The simulation model is then used to analyse the effects on his household of a specific health intervention, namely the Directly Observer Treatment Short Course (DOTS) treatment. It shows that DOTS offers positive improvements of the overall well-being of the household by restoring the working capacity of the rickshaw puller in one treatment course and minimizing lost income. Assets and food consumption would be preserved significantly more in the presence of DOTS, rendering the household both financially and physically less vulnerable. The probability of death of the sick rickshaw puller is also significantly reduced, improving household's welfare over the long run.

Towards new partnerships for health development in developing countries: the contractual approach as a policy tool.

What roles for government but also for society's groups in the advancement of public health in developing countries? This paper focuses on the need to adopt the contractual approach as a powerful policy tool and sketches the contours of a policy framework for good contracting. A short historical review of health system changes leads up to a discussion of the current emergence of a multitude of actors, the forging of alliances between the various partners, examples on how significant health policy benefits might be secured through contracting, and the implications of building alliances, such as defining and assigning accountability to the contracting partners.

Cost-effectiveness analysis of alternative treatments of African gambiense trypanosomiasis in Uganda.

African trypanosomiasis, or sleeping sickness, is a tropical disease caused by trypanosome parasites transmitted by tsetse flies. The focus of this paper is on the cost-effectiveness of alternative drug treatments for patients in the late stage of the disease. Melarsoprol has been used for many decades. More recently, eflornithine has been developed. It has fewer side effects and improves the overall cure rate. It is much more expensive than melarsoprol, however. The objective of the present cost-effectiveness is to identify the costs and benefits that would be involved in switching from melarsoprol to eflornithine in the treatment of late stage sleeping sickness. Benefits are expressed in lives saved as well as in disability adjusted life years (DALYs). The analysis is applied to the case of Uganda. The implications for affordability are also considered, by taking account of how the treatment costs would be shared between the national government, donors and patients. The baseline results indicate that melarsoprol treatment is associated with an incremental cost per life and DALY saved of $209 and $8, respectively. Each additional life saved by switching from melarsoprol alone to a combination of melarsoprol and eflornithine would cost an extra $1,033 per life saved, and an extra $40.9 per DALY gained. Shifting from this second alternative to treatment of all patients with eflornithine leads to an incremental cost per life saved of $4,444 and an incremental cost of $166.8 per DALY gained.

Developing countries' health expenditure information: what exists and what is needed?

In the past decade, the scarcity of financial resources for the health sector has increasingly led countries to take stock of national health resources used, review allocation patterns, assess the efficiency of existing resource use, and study health financing options. The primary difficulties in undertaking these analyses have been 1) the lack of information on health expenditures and 2) not using existing information to improve the planning and management of health sector resources. The principle sources of available health expenditure information are reported by organizations such as the World Bank, WHO, UNICEF and OECD. Special studies and non-routine information are a second major source of information. This existing data has a number of difficulties, including being sporadic, inconsistency, inclusion of only national level public expenditure, high opportunity and maintenance costs, quantitative and qualitative differences across countries, and validity and interpretability problems. Reliable health expenditure data would be useful not only for in-country, national purposes, but also for cross-national comparisons and for development agencies. Country uses of health expenditure data include policy formulation and planning and management, while international uses would facilitate examination of cross-national comparisons, reviews of existing programmes and identification of funding priorities. Collaborative efforts between countries and international development agencies, as well as between agencies, are needed to establish guidelines for health expenditure data sets. This development must ensure that the resulting information is of direct benefit to countries, as well as to agencies. Results of such collaborative efforts may include a set of standardized methodologies and tools; standardized national health accounts for developing countries; and training to enhance national capabilities to actively use the information. The opportunities for such collaboration are unique with the issuance of the World Development Report 1993, to build on this work in clearly identifying what is needed and proposing a standardized data set and the tools necessary to regularly and economically gather such data.

Cost-effectiveness analysis of prenatal screening and vaccination against hepatitis B virus--the case of Belgium.

The study examines the cost-effectiveness of screening pregnant women in Belgium for the presence of hepatitis B virus (HBV) and of vaccinating the newborns if necessary. The alternative strategy considered is 'doing nothing'. The rate of carriership among a sample of pregnant women in Belgium amounts to 0.67%. If a pregnant woman is a carrier of the virus, there is an average probability of 30% that she will transmit the virus to her newborn. Later in life, this baby will be at risk from serious complications, such as chronic active hepatitis, cirrhosis and primary hepatocellular cancer. However, medical costs will be induced by screening and vaccination campaigns, lab-tests, vaccine costs, etc. On the other hand, resources will be saved by the prevention of severe complications of the disease. However, costs dominate savings, the incremental cost-effectiveness ratio for the screening and vaccination strategy amounting to 583,581 BEF per life-year saved. To check the stability of the cost-effectiveness ratio, a sensitivity analysis has been performed on some crucial parameters: the ratio is found to be sensitive to the prevalence of HBV among pregnant women, to the costs for screening and vaccination and to the discount rate. Increasing the treatment costs for a HBV complication hardly changes the cost-effectiveness ratio.

Issues in the cross-national assessment of health technology.

With the growing international literature in economic evaluation and the rapid spread of new health technologies, there is a need to undertake, or at least interpret, economic evaluations on the international level. However, the ways in which cross-national differences affect the cost-effectiveness of health technologies or their evaluations have never been studied. This paper explores these issues by taking advantage of a unique situation in which the same economic evaluation of a new indication for a health technology was conducted simultaneously in four countries using an identical methodology. The study showed that if prior agreement on methods can be reached and local data applied, economic evaluations can be undertaken in a way that facilitates the extrapolation of results from country to country.

Finance for health care: part of a broad canvas.

The economic crisis of the 1980s led to cuts in both government and household expenditure on health in the Third World. In order to address these issues it is necessary to adopt a macroeconomic approach to the analysis of the health sector; this allows its relationship to the whole economy to be understood. The efficient and equitable utilization of resources is particularly important in times of severe financial constraint.

PIP: Economic conditions in developing countries during the 1980s at the macroeconomic level deteriorated. The effects on health services funding are described. the improvement in economic conditions and whether economic progress can be speeded up are discussed. Management of resources and the challenges for nongovernmental organizations (NGOs) are also given attention. Governments have been encouraged to increase the resources for primary health care. The economic crisis after Alma Ata in 1978 increased external debt and interest payments. The International Monetary Fund and the World Bank imposed financial stabilization and structural adjustment restraints, which meant cuts to the social and health sectors. The issues are whether health has received its fair share and to what extend the economic crisis has decreased household health expenditures. The macroeconomic picture is that in 20 african countries publicly financed health expenditure declined from US $9.50/capita in 1982 to US $8.70 adjusted in 1985. Increases were made in 1987 to US $9.90. Health indicators improved during the 1980s in spite of the government reduction in expenditures because households contributed to the costs of health care. Expenditures on health are beneficial to other sectors. Improvements have been made in the balance of payments and current account deficits have declined. Recovery is evidenced and it is expected that health budgets will be increased to reflect these changes. Immunization of 1-year olds is expected to increase. Most of the 34 countries ranked low on an index of life expectancy, literacy, and gross domestic product/capita will reach 1005 immunization by the year 2000. Access to safe water is also expected to improve. Child mortality rates of 70/1000 live births will be much harder to reach by 2000. AIDS is expected to impact on child mortality. Growth in the health sector should be matched with growth in the economy as a whole. Reallocation of resources should be accomplished only when resources do not contribute to health objectives. Waste needs to be eliminated. Preventive care should be a priority. NGOs should integrate their strategies into overall development aims, share know-how, and continue creative work. More efficient and equitable financing is needed.