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World Health Organization Making health service work for the poor: incentives for strengthening health systems performance Berlin, 8-10 July 2002 Orvill.

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Presentation on theme: "World Health Organization Making health service work for the poor: incentives for strengthening health systems performance Berlin, 8-10 July 2002 Orvill."— Presentation transcript:

1 World Health Organization Making health service work for the poor: incentives for strengthening health systems performance Berlin, 8-10 July 2002 Orvill Adams Director, Department of Health Service Provision Evidence and Information for Health Policy

2 World Health Organization Overview Policy makers and the public need information –New data sources –New indicators and measures Service provision needs to be more efficient –through information & accountability –through direct incentives

3 World Health Organization What policy makers need to know Identification of the population at risk - the poor Health conditions of the poor Degree to which interventions are reaching the poor information on provider characteristics and costs

4 World Health Organization WHO response Populations surveys, DHS, LSMS World health survey - 91 plus countries, rolling out to 191 over 3 years CHOICE –WHO initiative to provide evidence on the effectiveness and costs of major health interventions for 17 sub-regions of the world –Cost-effectiveness information can be used to identify the allocatively efficient set of interventions

5 World Health Organization Overall HSPA objectives 1) Monitor and evaluate attainment of critical outcomes and the efficiency of the health system in a way that allows comparison overtime and across systems 2) Build an evidence-base on the relationship between the design of the health system and performance 3) Empower the public with information relevant to their well-being

6 World Health Organization Health system goalsHealthResponsiveness Financial Contribution LevelDistribution QualityEquity  Efficiency

7 World Health Organization WHO world health survey CORE modules Modules –Health ( description & valuation) –Health system responsiveness –Health financing and expenditure –Adult mortality –Risk factors and chronic diseases –Assets Modules (continued) –Coverage key interventions –Provider survey (under development) Based on scientific review of existing instruments Developed through: – Cognitive interviews & cultural applicability tests – Reliability - stability of application – Cross-population comparability Flexible shell: additional modules could be added by countries as needed Flexible shell: additional modules could be added by countries as needed

8 World Health Organization Coverage interventions Maternal care - antenatal care, attended delivery Child health - immunization Prevention of STI and HIV/AIDS Malaria and TB HIV/AIDS - mother-to child transmission, ARV treatment, chronic care Chronic conditions - angina, epilepsy, asthma, depression, diabetes, arthritis Cancer screening, vision and hearing, road traffic injuries Water and sanitation

9 World Health Organization Definition of effective coverage The probability of receiving a necessary health intervention conditional on the presence of a health care need

10 World Health Organization Provider characteristics and provider surveys Indicators of this instrumental goal (linked to intrinsic goals) National health accounts - basic and detailed matrices (type of care, type of provider, service) Facility surveys - including aspects of responsiveness, fairness in financing, human resources, provider performance assessment, burden of disease

11 World Health Organization Health inequalities: Ghana

12 World Health Organization Health inequalities: Indonesia

13 World Health Organization Decomposition of inequality index

14 World Health Organization Service provision needs to be more efficient Through better information & accountability Through direct incentives

15 World Health Organization Why don’t the poor have access to health services? The public sector fails: –Lack of resources? –Low efficiency? –Political biased allocation of resources? The private sector fails: –Unequal income distribution and lack of “effective demand” –Imperfect markets

16 World Health Organization Inefficient resource allocation: Ratio of nurses to doctors in L.A. and Caribbean 3 nurses per doctor in N. America Source: PAHO, 1998

17 World Health Organization Note: For countries with population > 5 million Source: WHO Infant mortality varies across countries that spend similar amounts on health

18 World Health Organization GDP Per Capita (ppp$) Regression Line Out-of-pocket share of health spending (%) Out-of-pocket share declines with income

19 World Health Organization HFC Burundi HFC Latvia HFC Expenditure decile Romania

20 World Health Organization Why is efficiency of health services important? Reduces the amount of public services that can be provided Reduces the quality of public services Leads to inequities in service provision Lowers productivity Reduces international competitiveness

21 World Health Organization Sources of inefficiency: the agency problem Principal and agent: Different objectives Different information Cost of restructuring is high Efficient contracts are hard to find

22 World Health Organization Approaches to the agency problem Non-pecuniary motivation Pay for output Pay by effort Fixed payments and agent assumes risk Is it enough? Can you precisely define outputs? Is effort measurable? Can you accept bankruptcies and overpayments?

23 World Health Organization What has been tried? Models Command & control Performance contracts Internal markets Contests Competition Examples Military Corporatized hospital Health districts Water concessions Primary schools

24 World Health Organization Typically in the private sector... Non-pecuniary motivation Pay for output Pay by “effort” Fixed payments and agent assumes risk “Team players” & awards Only for piecework Salaried workers Contractors

25 World Health Organization Typically in the public sector... Motivation and vocation may be difficult to achieve at a large scale Limited managerial discretion over workforce Measurement of outputs is difficult

26 World Health Organization Health systems have the problems of markets... Down side: Moral hazards Administrative and marketing costs Difficulty mobilizing public resources Variable quality Potentially: Incentives for good performance Attention to consumer Incentive to collect Accommodation of differences among population groups

27 World Health Organization... and problems of bureaucracies Down side: Inefficient allocations that raise costs Lack of transparency Restricted managerial discretion Unresponsive to clients Potentially: National planning Easier to be redistributive Potentially lower administrative costs “Fair”

28 World Health Organization Improving health services for the poor through incentives Purchasing insurance coverage: Colombia Rewarding performance: Haiti Incentives for staff: Kenya

29 World Health Organization Coverage expanded especially among the poor in Colombia Contributors Subsidized Fuente: Sanchez, 2000

30 World Health Organization Immunization 3+ prenatalFP discontin.ORTCorrect ORT 4+ FP available Baseline ResultTarget Results of active purchasing: NGO in Haiti Source: R. Eichler, “Strategic Purchasing in Haiti to Improve Health”, EUROLAC Case Study, World Bank, 2002.

31 World Health Organization Improved financial performance in Kenya Source: Rena Eichler. Performance-based reimbursement of rural primary care providers: evidence from Kenya Six-month total gain or loss

32 World Health Organization Conclusion When health services are inefficient the poor suffer disproportionately Incentives (external and internal) have been shown to work WHO programs will provided information need by decision makers


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