Health financing is a key function of the health care system, and is a complex issue. The classification, such as the one we are proposing is simply meant to facilitate the reflecting around a response. At the policy level, programs partner with country governments to strengthen the governance frameworks, including regulations, policies, and organizational structures to manage health financing so that health services are provided efficiently, effectively, equitably, and with adequate quality. Risk adjustment and risk selection in Europe: 6 years later. 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]. In the absence of risk pooling, payments made for health services would be directly related to the health needs of the individual, i.e. PubMed Cookies policy. Risk adjustment can be organized in two ways: Either funds are allocated from a national level fundholder to the various pools through risk-adjusted allocations, based on such criteria as age, sex, poverty status and disease burden [1]. 1.2.1. Figure 5.3 below provides a breakdown of health care expenditure by health care function and financing source for 2019. 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]. 2018;122:45772. Article Today, millions of Mutuelle sant d'entreprise : les obligations de l'employeur ; 2018, https://www.service-public.fr/professionnels-entreprises/vosdroits/F33754 (Accessed on 10 January 2018). Only a few publications [1, 11,12,13,14,15,16] provide conceptual insights into the structure of and mechanisms for pooling arrangements. PLoS ONE. The complex structure of Australia's . In: Chernichovsky D, Hanson K, editors. https://doi.org/10.1093/heapol/czt054. The highest VHI expenditure share (47%) was in South Africa, yet this spending covered only about 16% of the population [52]. hmo6 they try to enroll members with low health risks relative to their contributions in order to incur lower health costs and thus reach a larger margin between revenues and expected expenditures. Available from: https://www.academia.edu/33391064/The_Health_Insurance_System_in_Peru_Towards_a_Universal_Health_Insurance. The better-off groups - those in formal employment benefit from much higher per capita funding and a much higher level of benefits compared to the rest of the population with much lower levels of financial protection. Council for Medical Schemes (CMS). 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. financing refers to any mechanism that gives people the ability to pay for health care services; the two functions of financing are purchase of health insurance and payment for the services delivered to insured patients before the main insurance clauses of ACA went into effect of 2013, the main percentage of americans without health insurance . Current expenditure on health (all functions) Inpatient curative and rehabilitative care Outpatient curative and rehabilitative care Long-term care (health) Ancillary services (non-specified by function) Medical goods (non-specified by function) Preventive care Governance and health system and financing administration Other health . In many countries, different pools exist for different socio-economic groups, creating a highly fragmented system with population segmentation. Alhassan RK, Nketiah-Amponsah E, Arhinful DK. Department of Health and Human Services What does health care financing mean? hbbd``b` "$8@B\HHo \Q u 88b``g T Google Scholar. Over time, the result is that benefits are curtailed for those who need them most, while fewer and fewer healthier individuals join the scheme. Provided by the Springer Nature SharedIt content-sharing initiative. 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. Mathauer I, Kutzin J. There are some countries that rely predominantly on a single national pool funded from general government revenues. A Review of the National Health Insurance Scheme in Ghana: What Are the Sustainability Threats and Prospects? 192 0 obj<>stream Decentralized countries often have pools organized by government administrative levels. Kutzin J. Hungary, Bull World Health Organ. In: Figueras J, editor. Int J Equity Health. Taken quite literally, perhaps no country has only one single pool. New Delhi: Asia Pacific Observatory on Health Systems and Policies; 2016. From these two institutional design aspects, we need to distinguish the level of prepaid funding, which is not considered in this classification. 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. 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. Gautier J. The classification is presented in Fig. Health financing involves the basic functions of revenue collection, pooling of resources, and purchase of interventions. This duplication of functional responsibilities can be a major driver of inefficiency when seen from the perspective of the entire system rather than within each scheme [15, 20]. 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 Mathauer I, Dale E, Meessen B. However, we recognize that any classification is a simplification of reality and does not substitute for a country-specific analysis of pooling arrangements. WHO definition of health financing: Health financing is the function of a health system concerned with the. This is commonly referred to as a competitive social health insurance arrangement. 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. To develop the classification, we combined the different features in the structure and the nature of pooling and then examined the nature and structure of pooling in more than 100 countries across all income groups. Latin American development forum. Here the pooling function lies with a sub-national entity, such as a state, province, or district (if managed by a level of public administration) or another entity, such as a health insurance fund, with defined responsibility for the entire population of that territory [14]. the accumulation and management of prepaid financial resources on behalf of some or all of the population; and 3) purchasing, i.e. World Health Organization. However, there are some examples from larger or very large countries, such as Hungary [35] and Turkey [36]. Financial Management Functions. Geneva: World Health Organization; 2019. ), (7.) general tax revenues or a combination of those revenues and social insurance contributions from employers and employees [30]. This is the so-called death spiral of voluntary health insurance [24]. Akerlof GA. Health nutrition and population discussion paper. In Switzerland, this insurance system is further territorially divided up, in that the multiple pools operate within each sub-national unit [50]. The extent to which a health financing system effectively attains this risk pooling objective is affected by the amount of revenues raised, how well health services are purchased, and also by the design of pooling arrangements. Book Pooling arrangements influence not only risk pooling (and via this pathway, financial protection and equity in service use), but also the intermediate UHC objectives of efficiency and equity in the distribution of a health systems resources. In the case of supplementary coverage (access to the private sector), there are also system effects such as skewed public spending and staff migration to the private health provider sector [41]. In: Chernichovsky D, Hanson K, editors. It is the provision of money to the population for health services (preventive as well as curative), family planning activities, nutrition activities, and emergency aid designated for health. A key principle of this pooling arrangement is compulsory or automatic coverage for the whole population. Healthcare organizations must be able to minimize costs in order to be financially successful. Raising and channeling funds: Working Group 2 report, 2009. Provide coaching and mentoring support to implementation partners for market facilitation activities as well as local market actors that may be taking on health . 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. Figure 3.1 highlights these. 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. Kroneman M, Boerma W, van den Berg M, Groenewegen P, de Jong J, van Ginneken E. The Netherlands: health system review. Implementing health financing reform: lessons from countries in transition. This is followed by an outlineof the key institutional design aspects of pooling arrangements and how these can create fragmentation. Geneva: World Health Organization; 2017. This mitigates some of the effects of segmentation, though remains often incomplete due to the entrenched power of the initially insured population groups. Moreover, in Indonesia, there is substantial reliance on supply-side budgets [37] as is the case for Mongolia for example [34]. 0000007449 00000 n Fragmentation in pooling can also contribute to inefficiency in the health system, as it typically implies a duplication (or multiplication) in the number of agencies required to manage the pools (and, usually, purchasing as well) [19]. PubMed Agustina R, Dartanto T, Sitompul R, Susiloretni KA, Suparmi AEL, Taher A, Wirawan F, Sungkar S, Sudarmono P, Shankar AH, Thabrany H. Universal health coverage in Indonesia: concept, progress, and challenges. Manage cookies/Do not sell my data we use in the preference centre. Complementary insurance for health services covers benefits that are excluded from the public systems package, thereby giving access to a wider range of benefits. PubMed Central %%EOF K]NiGe(T&k,JTNeu@#KWB&@XxDXw-2^ctyc9d"E@yk3'1V-o PKW em2VK: It is important to mention that supply side financing, where the health budget flows in a vertically integrated way to service providers, constitutes a pool, and in many cases is often the largest pool in low- and middle-income countries. Capacity strengthening of the MSP will also be an important component of this program. A system-wide approach to analysing efficiency across health programmes. Higher income persons are usually more likely to have this form of VHI [51]. Therefore, maximizing the potential to redistribute from lower-need to higher-need individuals by de-linking contributions (of whatever form, such as taxes or insurance premiums) from their health risk is the central objective for pooling. Int J Equity Health. World Health Organization. OECD, Eurostat. Pools are thus not divided along population groups. This leads to duplication of health facilities, particularly in big cities. xref They also need to monitor cash on hand, businesses may be profitable but have a shortage of cash and. In the early 1990s, Thailand had a scheme for civil servants and another scheme for private sector employees. From a system perspective, this pooling arrangement has major disadvantages with regards to redistributive capacity. Abt Associates is a mission-driven, global leader in research and program implementation in the fields of health, social and environmental policy, and international development. The attributes of a countrys pooling arrangements that have positive implications for UHC goals are in many ways the opposite of what is implied by fragmentation. Berkshire: Open University Press; 2005. van de Ven WP, Beck K, Van de Voorde C, Wasem J, Zmora I. Meaning of terms Revenue Collection is the way health systems raise money from households (e.g. A system of health accounts. Health financing has three key functions: revenue collection, pooling of resources, and purchasing of services. What are the functions of health financing mechanisms? Structured pluralism: towards an innovative model for health system reform in Latin America. Health financing systems have a key role in achieving universal health coverage (UHC) across the globe. But where territorially distinct pools are too small in terms of the number of people, their risk profile can be financially precarious and there could be efficiency and capacity concerns. , v2HuW]:'01%`!cl/i*u$oL|Sf_%^G;SPCY+ZxcsA^[W' ^`^^ AHjX FqtHI(@[10*i. Likewise, when their sizes differ across the country, they could turn out to have unequal redistributive capacities [14]. 3. Valuable comments from Ke Xu, Matthew Jowett, Fahdi Dkhimi, Susan Sparkes, Aurelie Klein and Julius Murke are gratefully acknowledged. Figure 1. co-payments), thus reducing out-of-pocket expenditure and potentially improving financial protection. However, evidence for efficiency improvement with increased market competition among purchasers is weak [25]. Agency's Mandate and Functions Mandate. 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. endstream endobj 788 0 obj <>/Metadata 86 0 R/OCProperties<>/OCGs[800 0 R]>>/Outlines 125 0 R/PageLayout/SinglePage/Pages 783 0 R/StructTreeRoot 156 0 R/Type/Catalog>> endobj 789 0 obj <>/ExtGState<>/Font<>/Properties<>/XObject<>>>/Rotate 0/StructParents 0/Tabs/S/Type/Page>> endobj 790 0 obj <>stream the allocation of pooled funds to health service Based on this, we identify and present broad types of pooling arrangements and related fragmentation issues and discuss implications and challenges. Pooling ensures that the risk related to financing health interventions is borne by all the members of the pool and not by each contributor individually. Such a pool setup creates immense scope for inequity, as it allows for enormous differences in available resources per capita across pools. Three key health financing system functions Resource Mobilization: Countries need to consider three issues: What are the sources of funding for health? Spending wisely: buying health services for the poor. Click the card to flip . 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. Google Scholar. Library of Parliamentarians: Ottawa; 2011. Indeed, these arrangements put in place for health financing further exacerbated existing inequalities in these countries rather than compensating for them. Promoting strategic purchasing Making the purchasing of health services more strategic is critical for countries to progress towards universal health coverage. Pools are fragmented when there are barriers to redistribution of available prepaid funds. poverty status) or costs of serving the population of a specific region (e.g. In: Kutzin J, Cashin C, Jakab M, editors. These latter three were replaced by a new health coverage scheme that was introduced in 2002, called the Universal Coverage Scheme (UCS), as a response to growing concerns about the huge differences in level of funding per capita across the schemes and the remaining coverage gap due to the failure of the voluntary insurance to reach much of the informal sector. In the health sector, Malaysia was to gradually move away from a policy of highly subsidized care for all population groups, encouraging the growth of the private sector in health and shifting to other financing methods, including insurance, to finance the healthcare system (Khoon, 2010). Overview sicker individuals would have to pay more because they would need more health services [18]. State budget transfers to health insurance funds for universal health coverage: institutional design patterns and challenges of covering those outside the formal sector in eastern European high-income countries. 0000035307 00000 n Such a pool provides compulsory or automatic coverage for the entire population, usually for a defined package of services. These attributes are [1] large size in terms of the number of people covered by the pool, and [2] diversity of health risks within the pool [1]. 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B\Hho \Q u 88b `` g T Google Scholar [ 1, 11,12,13,14,15,16 ] provide conceptual insights into functions of health financing of! `` $ 8 @ B\HHo \Q u 88b `` g T Google Scholar [. Health programmes gratefully acknowledged in these countries rather than compensating for them can create fragmentation setup creates immense for... Funding for health pool provides compulsory or automatic coverage for the entire population, for. An innovative model for health financing is a simplification of reality and not. Provide conceptual insights into the structure of and mechanisms for pooling arrangements 1, 11,12,13,14,15,16 ] conceptual..., functions of health financing is not considered in this classification Mandate and functions Mandate classification... Facilities, particularly in big cities B\HHo \Q u 88b `` g T Scholar! Xref they also contribute to system-wide inefficiencies arising from the duplication of for... Evidence for efficiency improvement with increased market competition among purchasers is weak [ 25 ] a pool setup creates scope... Structure of Australia & # x27 ; s Mandate and functions Mandate may be taking on health n a.
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