The path to universal coverage: The World Health Report October, Nossal Institute, Melbourne Martina Pellny, Technical Officer Health Care Financing, WHO Regional Office for the Western Pacific (WPRO), DPS, Fiji 4 th Technical Review Meeting for the Health Policy and Health Finance Knowledge Hub

2 |2 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 WHR 2010: Universal Coverage WHR topic based on World Health Assembly Resolution in 2005  The Resolution defined “Universal Coverage” ascoverage with: needed health services; financial risk protection; for everyone.  The Resolution defined “Universal Coverage” as coverage with: needed health services; financial risk protection; for everyone. The aspiration to attain universal coverage is not new. You find reference to it in: WHO's constitution-1948; Alma-Ata Declaration-1978; World Health Report on Primary Health Care-2008 etc The resolution also states that universal (health) coverage can not be achieved without a well-functioning health financing system

3 |3 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Three Dimensions

4 |4 | Health Systems Financing and the Path to Universal Coverage The World Health Report Dimension: Financial Protection Millions suffer financial ruin when they use health services:  Globally around 150 million suffer severe financial hardship/ catastrophic health expenditures each year.  100 million are pushed into poverty because they must pay out-of-pocket at the time they receive health services.

5 |5 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Highest burden in Asia: In the WHO WPRO region 80 million people experience financial catastrophe and 50 million impoverish due to health payments (half the people worldwide). Source: Equitap 1. Dimension: Financial Protection

6 |6 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Source: WPRO Health Financing Review, Dimension: Financial Protection

7 |7 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Source: CHIPS Dimension: which services are covered?

8 |8 | Health Systems Financing and the Path to Universal Coverage The World Health Report Dimension: who is covered? P ercentage of births attended by skilled health worker countries

9 |9 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 The WHR-2010 proposes three inter- related health financing strategic options for universal coverage: - Raise sufficient funds for health: More money for health - Reduce heavy reliance on direct OOP: More equity for health. -Reduce and eliminate inefficient use of resources: More health for the money Proposing solutions: the WHR 2010

10 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Problem 1: Insufficient funds  A set of essential health services focusing on the Millennium Development Goals would cost on average US$ 44 per capita in low-income countries in 2009, rising to US$ 60 in 2015 (estimates provided by the HLTF on Innovative International Financing for Health Systems).  31 low income countries spent less than US$ 35 per person (2008)  Only 8 have any chance of reaching the required funding from domestic sources by even assuming rapid growth of their domestic economies.  CAM (30), Laos (24), PNG (29), Solomon Islands (44), Vietnam(46)

11 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Options for raising more domestic funds for health  Increase the priority given to health in government budget allocations  MoHs often not powerful enough – loose out in budget negotiations  Ex: MTEF - clear and transparent targets  Ex: Abuja declaration: African heads of state declared in 2001 to increase the share of government expenditures going to health to 15% of GGE in 2007, and failed  Raise revenue for health more efficiently – e.g. increase the total availability of resources (strong tax base)  In Indonesia, clear and consistent regulations and a policy of zero- tolerance for corruption increased tax yield from 9.9% to 11% of GDP over four years – with a subsequent increase in health expenditures.

12 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010  Find new sources of domestic funds e.g.  "Sin" taxes on tobacco and alcohol: a 50% increase in tobacco tax alone would yield an additional US$ 1.42 billion - this could increase government health expenditure by up to 25%.  Excise tax on unhealthy food – Romania – 20% on foods high in fat, salt, sugar  Levy on currency transactions would be feasible in countries with large markets – e.g. India could raise US$ 370 million per year from a very small levy (0.005%).  Levy on remittance transactions - Gabon  Levy on large/ profitable companies – Australia (mining companies); Pakistan (pharmaceutical companies), Gabon (mobile ph. companies). Options for raising more domestic funds for health

13 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 The WHR-2010 proposes three inter- related health financing strategic options for universal coverage: - Raise sufficient funds for health: More money for health - Reduce heavy reliance on direct OOP: More equity for health. -Reduce and eliminate inefficient use of resources: More health for the money Problem 2: Heavy reliance on direct OOPs

14 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Options to reduce the impact of OOPs  Reducing OOPs requires switching to systems of “prepayment” with subsequent “pooling” of revenues (Prepayment means paying before illness – and it can take the form of taxation or insurance – Beveridge/ Bismarck/ mix). PREPAYMENT  There seems a minimum level of compulsory prepaid funding that is necessary to ensure that the poor and vulnerable are covered: ca. 4-6% of GDP. See WHO WPRO benchmark: “Universal coverage is difficult to achieve if public financing is less than 5% of GDP”. MINIMUM  Community and micro-insurance can play a useful role in the early stages, but plans to merge them over time are important - bigger pools are more financially viable than small community-based pooled funds. CONSOLIDATE POOLS AND REGULATE

15 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Options to reduce the impact of OOPs Options in addition to prepaid and pooled resources to ensure greater coverage and lower financial barriers:  Free or subsidized services (e.g. through exemptions or vouchers) for specific groups of people (i.e. the poor) or for specific health conditions (i.e. child or maternal care).  Subsidized or free insurance contributions for the poor and vulnerable.  Cash payments to cover for ex. transport costs for the poor.

16 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Problem 3: Inefficiencies Ten leading source of inefficiency 1. Medicine: underuse of generics and higher than necessary price. 2. Medicine: use of substandard and counterfeit medicines. 3. Medicine: inappropriate and ineffective use. 4. Products and services: overuse/supply of equipment, diagnostic services and procedures. 5. Health workers: inappropriate or costly staff mix, unmotivated workers. 6. Health service: inappropriate hospital admission and length of stay. 7. Health service: inappropriate hospital size and low use of infrastructure. 8. Health service: medical errors and suboptimal quality. 9. Health system leakages: waste, corruption and fraud 10. Health intervention: inefficient mix and inappropriate level.

17 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Options to encourage greater efficiency For example: 1.Paying providers: move away from fee for service if possible. Consider results-based payment where good monitoring is possible etc. 2.Medicines: improve prescribing guidance, training of staff; incentives for generic substitution; regulate promotional activities, more public information (irrational use) etc. 3.Health services/ governance: Provide more continuity of care, monitor hospital performance, improve regulatory capacity 4.Reduce duplication – avoid “fragmentation” with - Funding channels; - Laboratory systems; - Auditing and monitoring systems; - Reporting systems including reporting to donors (Aid effectiveness principles).

18 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Greater efficiency includes comprehensive health plans National health plans

19 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 ConclusionConclusion  Regardless of the stages of development, each country can improve their financing systems to maintain or progress towards universal coverage.  The global community can do more to raise needed funds and strengthen national financing institutions and capacities to attain universal coverage.  Stop introducing more global initiatives with more secretariats at the international level.  Buy into the countries national health plans and channel funds to countries in ways that build domestic financing capacities and institutions, rather than bypassing weak systems – e.g. fund Sector Wide Approaches, General Budget Support etc

20 | Health Systems Financing and the Path to Universal Coverage The World Health Report 2010 Thank you