1. Indonesian Health Reform in a decentralized system
Laksono Trisnantoro
Center for Health Service Management
Gadjah Mada University

2. Preface This paper is concerned with critical questions:
Is there a reform in Indonesian health sector?
Whether decentralization policy supports health care reform?

3. Content Definition of Reform in Health Care Observations: Conclusion
1. Health Care Reform at national level under decentralized policy ( 1999 – 2007)
2. Health Care Reform in 7 Provinces (2006),
Conclusion
What next?

4. What Do We Mean by “Health System Reform”? (Bossert, 2007)
Reform Definition
sustained, purposeful change to improve the efficiency, equity, and effectiveness of the health sector
What Do We Mean by “Health System Reform”? (Bossert, 2007)

5. Health system reform:
Not everything that changes, or causes change, is a health system reform
Purposeful efforts to change the system to improve its performance
Using an interesting understanding of:
“little r” reforms; Small changes to one or a few features of the system
“Big R” reforms; Large changes to more than one feature of the system
Flagship Course: Cycle of Reform, Monday - October 29, 2007, Session 2

6. What is the meaning of health system features?
Depends on the definition:
WHO: stewardship, provision, resources generation, etc
Kovner: the role of government in: regulation, provision of services, and financing the system
Harvard and WBI: use the “knobs” metaphora

7. The “Control Knobs” from Harvard and WBI
Financing
Payment
Organization
Regulation
Persuasion and Behaviour Change
Flagship Course: Cycle of Reform, Monday - October 29, 2007, Session 2

8. Terminology reform Reform
“little r” reforms; Small changes to one or a few features of the system
“Big R” reforms; Large changes to more than one feature of the system
Will be used for analyzing Indonesian Health Sector through 2 observations:
National level
Provincial level

9. Observation 1: National Level
Reform in Finance
Reform in Organizing and Paying Human Resources
Reform in Regulation
Reform in health Promotion
....
Critical Question:
Is there any reform in
health finance?
Human Resources?
Is there any effort for linking these features of health reform?

10. Reform in Health Finance
Historical context of Indonesian Health Finance
Major milestones in the 2000s
What happened?

11. Historical Perspective
Colonial Period
Independence and the “Old Order”
“New Order”
Decentralized era
Before 1945
at present

12. Colonial Period
The Dutch Indie was not administered as a welfare state
Health services were provided for government employees, military personnel, and big company employees.
Missionary hospitals and health services worked with limited coverage

13. 1945 - 1965 The period of market forces suppression
There was no clear national health financing policy.
There was an Act on poor family health services in early 1950s, but poorly implemented.
Health insurance and social security is limited for government employees, military personnel, and big company employees.

14. 1965-1998 The market economy was introduced
The private sector growth rapidly, incl, for profit hospitals.
There is a corporatization of medical services based on market forces
There was no clear regulation of health market
1997: Economic crisis induced the Social Safety Net incl. Health.

15. current
Decentralization era since the stepdown of Suharto in 1998
Direct Presidential and Governor/Major election
More populist policies at national,provincial, and district level
Poor family has free health and hospital services
Poor family scheme becomes political issue

16. Historical Facts
Indonesia is not a welfare state since the colonial era
Indonesia has market based economy
Indonesian health system refers to American model using Safety Net, not the British one.
Hospitals operate within market ideology
Medical Doctors (esp. specialists) operates based on the fundamental demand and supply principles.

17. Indonesian health finance situation in 2001

18. Study by Equitap Group
4/7/2017

19. 4/7/2017

20. 4/7/2017

21. 4/7/2017

22. The market forces domination in Indonesia
4/7/2017

23. Health Finance “Reform”
Objective: to achieve Universal Health Coverage by National Social Security Law (UU SJSN)

24. Indonesia’s Transition to Universal Coverage
(National Social Security Law No.40/2004)
PRESIDENT
Organization and Management
Nat Soc Sec Council
Board
Board
Board
Board
Board
PT. J A M S O T E K
PT. A S K E
PT. T A S P E N
PT. A S B R I
nch SS
Carrier J A M S O T E K
SS Carrier A S K E SS
Carrier T A S P E N SS
Carrier A S B R I
SS Carrier I N F O R M A L
Nat
Soc Security
Carriers
5 years
Branch
Branch
Branch
Branch
Branch
Branch
Branch
Branch
Branch
Nat Soc Security Council directs main policy
Nat Soc Security Carriers implement the program, not for profit
Synchronization of multiple schemes
Each single existing carrier
follows its own regulation
- For profit entities
Source: MOH: Ida Bagus Indra Gotama, Donald Pardede

25. The program in 2005
Ministry of Health introduced Askeskin (Health Insurance for the Poor)
The budget was calculated based on 5 thousand rupiah per month per individu.
(commercial health insurance: from , to US dollar for overseas scheme)
There was a poor registration system for poor people at the beginning of the program

26. The Contract to PT Askes Indonesia(2005-2007)
Ministry of Health under the new Minister contracted PT Askes Indonesia for managing the Askeskin scheme for poor family.
This was a radical change from the previous policy, which channel the central budget directly to the hospitals and encourage local government health office to develop health insurance scheme.
There was no pilot study

27. The Change in 2005 Contract to PT Askes Indonesia
Subsidy to Providers (based on utilization)
Government as Payer
Hospital
Community
Government as payer
Hospital
Community
PT Askes I

28. Health Insurance situation (2005-2007)
Source: Health PER, World Bank 2008

29. In 2008
: Many disputes between Ministry of Health and PT Askes Indonesia
A new change in 2008: Askeskin program was renamed to Jamkesmas.
The coverage is not only the poor but also near poor (more coverage).
The budget is channelled directly to Hospital and Health Centers using managed care concept (incl. DRG)
Increasing budget.

30. The national health security program increased government budget
How Pay for Health Care
4/7/2017

31. Is this an indicator of success in reforming Indonesian health finance?

32. Since 2001, - the health program for the poor had improved the utilization of public hospital by the poor - Kakwani Index is improving

33. But, There is still a geographical inequity Due to the access to
Medical specialists
Hospitals
Across Indonesia

34. Specialist distribution (KKI, 2008)
Jakarta: 24% of specialists, serves around 4% community in a relatively small area
Provinces in Java: 49% of specialists, serves around 53% community
Rest of Indonesia: 27% of specialists, serves around 43% community in a very large area

35. Average Number of Public Hospital at a district
Low economy in the community
High economy in the community
High Fiscal capacity in local government
2.5 2
Low fiscal capacity in local government
0.5
0.31

36. Average number of Private Hospital at a district
Low economy in the community
High economy in the community
High Fiscal capacity in local government
1.05
2.11
Low fiscal capacity in local government
0.5
1.91

37. Hipothesis
Health Finance provided by Jamkesmas will be used more by poor and near poor people in and around big cities
Most in Java Island
Left the poor and near poor people in remote area or in the places where there is no medical service and specialists

38. This hipothesis may explain why Indonesian Insurance Coverage Status in 2007 (based on social economy survey) looks not good.
Source: SUSENAS 2007

39. Therefore:
Health finance reform should be linked (at least) with Human Resources Reform
How is the condition of health care reform in human resources?

40. Reform in Human Resources
This discussion focuses on specialist

41. Indonesia is experiencing critical shortage of doctors, midwives and nurses
Sumber: WHR 2006

42. How many are really needed?  Perception of 32 districts*
Availability
GAP (%)
Doctor
987
593
39,9
Specialist Doctor 64 30
53,1
Dentist
497
294
40,8
Midwife
4565
2951
35,4
Nurse
4492
3295
26,6
Pharmacist 89 47
47,2
Dietician
652
404
38,0
Public Health
415
312
24,8
Sanitarian
737
530
28,1
182 82
54,9
Epidemiologist 21
100,0
Total
13.793
9.216
33,2
*) Bappenas Study in 2005

43. Doctor Distribution in 2003-2004

44. As an illustration: Specialists Distribution (Pediatrics)
Data: IDAI (Pediatrician Association, 2006)

45. Obstetric and Gynecologist
Typical graphic description of medical specialist distribution

46. National Plan for “Reform” in Health Human Resource

47. RPJP (Long Term Plan)
Reduce disparity on health status and health care
Increase the number and improve distribution of health workers
Improve access to health facility
Reduce double burden of diseases
Reduce misuse of narcotics and prohibited substances

48. RPJM (Medium Term Plan)
Increase the number, network and quality of health centers;
Increase the quality and the number of health personnel;
Develop health insurance system especially for the poor;
Increase dissemination of environmental health and healthy life style;
Increase health education to the community since early age; and
Distribute and increase the quality of primary health care.

49. Health Resource Program 2004-2009
RPJM (Medium Term Plan)
Health Resource Program
Objectives : increase number, improve quality & distribution of health personnel, as well as improve health insurance for the poor
Main Activities:
1. Setup Plans for health personnel need;
2. Improve skill and profesionalism through education and training
3. Deploy of health personnel especially for health centers (and their networks) and hospitals;
4. Carrier development
5. Improve sustainable health insurance for the poor.

50. RKP 2008 (Annual Plan)
Improvement of equity, accessibility, and quality of health services especially for the poor, through provision of free of charge access of the poor to health center and hospitals
Improving availability of medical and paramedical personnel, especially in remote and less developed areas
4/7/2017

51. The Facts in 2008

52. Specialist distribution (KKI, 2008)
Province
Number %
Cumulative
People served
Ratio
DKI Jakarta
2.890
23,92%
,00
1 : 3049
Jawa Timur
1.980
16,39%
40,30%
,00
1 : 18102
Jawa Barat
1.881
15,57%
55,87%
,00
1 : 21502
Jawa Tengah
1.231
10,19%
66,06%
,00
1 : 26092
Sumatera Utara
617
5,11%
71,17%
,00
1 : 20681
D.I.Jogjakarta
485
4,01%
75,18%
,00
1 : 6892
Sulawesi Selatan
434
3,59%
78,77%
,00
1 : 20043
Banten
352
2,91%
81,69%
,00
1 : 27943
Bali
350
2,90%
84,58%
,00
1 : 9905
Sumatera Selatan
216
1,79%
86,37%
,00
1 : 32296
Kalimantan Timur
203
1,68%
88,05%
,00
1 : 14585
Sulawesi Utara
173
1,43%
89,48%
,00
1 : 12697
Sumatera Barat
167
1,38%
90,86%
,00
1 : 26668
Propinsi Lainnya
1.104
9,14%
100,00%
,00
1 : 47998
12083
,00
1 : 18613

53. Number of private hospitals is increasing more than government ones.
Number of For-Profit Private-Hospital almost doubled in the last five years
Number of Non-For-Profit-Private Hospital almost remained the same
Owner 03 04 05 06 07 08
For Profit Corporation 49 52 55 60 71 85
Non-Profit (Foundation)
530
538
539
Non-Profit (NGOs) 27 28 29
Total
606
617
621
626
638
653

54. The increase of for-profit private hospital:
Most happened in Java
Indicates the increasing role of private sector which can attract more medical specialists to Java
Some owned by medical specialists
Doctor culture is more influenced by private health service organization
Without good payment and better work conidtion is more difficult for out of Java hospitals to attract doctors

55. Market influence in specialist is increasing.
Medical Specialis Culture Facts in 2008 (done by various cultural studies in medical specialists)
There is not any significant change in medical specialist behavior.
Market influence in specialist is increasing.
Jamkesmas (health insurance) program is difficult to compete with fee for service system for doctor and medical specialists
No managed care culture

56. Current Medical Practices:
Specialists prefer to provide services in the middle and upper class using fee-for-service
Try to set own fees
No standard income

57. Link between Health Finance “Reform” and Human Resources
Health finance “reform” does not consider medical doctor and specialist condition
No attention in reforming the doctor payment. The fee for medical doctor from Jamkesmas is too low or not clear.
Human resources “reform” is not clear and weak in practice.
Does not meet the criteria of Health System Reform

58. What Do We Mean by “Health System Reform”? (Bossert, 2007)
Does not meet the criteria of Health System Reform
What Do We Mean by “Health System Reform”? (Bossert, 2007)
Not everything that changes, or causes change, is a health system reform
Purposeful efforts to change the system to improve its performance
“little r” reforms; Small changes to one or a few features of the system
“Big R” reforms; Large changes to more than one feature of the system
Flagship Course: Cycle of Reform, Monday - October 29, 2007, Session 2

59. Note: the National Reform in Health Finance
Health finance reform is not will designed and executed
The SJSN Law is not yet effective due to the lack of Government Regulation for implementation
Until 2009 there is no GR
The current implementation of SJSN Law is more political rhetoric, not technical.

60. Reform at Provincial Level
Observation 2
Reform at Provincial Level

61. Based on DHS1 Project at 7 Provinces
Riau
Riau Island
Bengkulu
Bali
North Sulawesi
South East Sulawesi
Central Sulawesi

62. The Question: Is there any reform with big R at provincial level?
A close observation into 54 DHS1 projects which are called as reform activties in 7 provinces

63. Total Reform Topics 1 2 5 9 3 7 4 6 33 12 10 8 54 Health Finance
Riau
Riau Island
Bengkulu
Bali
North Slws
S East
Slws
Central
Health Finance 1 2 5
Health service provision 9 3 7 4 6 33
Stewardship/regulation
Human Resources
Community Empowerment
Health System development
Total 12 10 8 54

64. Analysis All reformed-program was not designed as a big “R” reform
Each reformed-program is independent each other
The most popular topic: Health service Provision
No reform in public and private partnership

65. Why there was no big “R” of health reform at provincial level?
There was no clear definition of health care reform
Provincial Government followed the change of national program and it is called reform.
Technical change in the program is also called reform.
No clear design of health care reform from the central government
Decentralization policy is not effective to initiate reform

66. Conclusion

67. 1. Health Reform is not well prepared at national and provincial level.
Reform is associated with political issue during the Suharto (ex president) stepdown period (1999).
Ministry of Health did not have intention to reform the health sector after decentralization policy (2000 – 2007)
There is no formal health reform document

68. 2. Health reform with small “r”only: not interrelated as prescribed by experts.
At national health finance reform was designed without any intention to link to the reform in:
Paying medical specialists
Improving the organization of health service (developing health service network across country)
Changing the behavior of people (e.g smoking prevalence increases among the poor people)

69. 3. Decentralization policy has little effect on the reform at provincial and district level
Why?
The Government Regulation No. 25/2000 (based on Act 22/99) on government function at different level was unclear in its concepts and implementation until replaced by PP 38/2007 (based on Act 32/04).
The period of 2000 – 2007 is still in the transition of decentralization policy
It is not the right time for making reform (as it is still in a transitional phase).

70. Notes: in the Decentralization Policy:
The pendulum is swinging
Act 22/99
Act 32/04
centralization
De-centralization

71. 2000-2007: The era of confusion and “strange” situation
Change without significant change
Change in the Laws and Regulation but not significant change in the process and the improvement of health status indicators.
Indonesian health sector is a decentralized sector but experiencing:
a more “centralized” financing system (06-07).
Not coordinated change.
Will be discussed in Nossal Institute, University of Melbourne, Thursday 20th of May 2009

72. After the stipulation of GR no 38 in 2007 (following Acts no 32/04):
the legal basis for designing and implementing health reform gets new momentum
Act 22/99
Act 32/04
centralization
De-centralization

73. Closing remark: What next?
Is there any future of Indonesian Health Reform
at National Level?
at Provincial?
at District?

74. 2007 Moving Forward Pesimistic? No health reform
Optimistic? There will be health reform at national, provincial and district level
Current activities in Indonesian Health Reform

75. Activities at central level
Ministry of Health established a small group on how to initiate health reform (started 2008)
But, this small group is not fully supported by top officers in the MoH

76. Activities at provincial and district level (small scale)
Gadjah Mada University in collaboration with MoH, local governments, supported by:
the World Bank Institute,
Harvard School of Public Health, and
Ausaid,
develops the capacity of planning and executing health care reform through the Flagship Program in Health Care Reform and Sustainable Financing (started in 2008)
The experiment is implemented in 5 Provinces and 5 districts/cities

77. The Flagship Program combined training and consultation
In-campus training (I)
In-campus training (II)
Off campus I: work assignment and consultation
Off campus II: work assignment and consultation
Preparation- FGD at each Prov/
District
- Acquiring data set
Post-Course
Consultation and Workshop

78. Health Sector Reform Cycle
EThics
Evaluation
Politics
Problem identification
Implementation
Diagnostic
Political Decision
Policy Development
Program Schedule
In-campus training (I)
In-campus training (II)
Off campus I: work assignment
Off campus II: work assignment
Preparation- FGD at each Prov/
District
- Acquiring data set
Post-Course
Consultation and Workshop

79. Whether the activities will be effective to initiate and implement health reform?
The Supports
There are sufficient experiences during the transition period of decentralization ( )
The legal basis is available
The support of Ministry of Home Affair for health reform based in decentralization policy is big.
The knowledge of health reform is supported by international experts
But,
The success depends on the leadership of Ministry of Health and Provincial/District/ City Health Leaders.

80. Thank-you