Can Demand Side Financing, e.g. vouchers, assist Governments to reach MDGs and reduce Maternal Mortality? Anna C. Gorter, MD, PhD Instituto CentroAmerica de la Salud Video Conference WHO, Port Moresby, PNG, September 8, 2010 Voucher Baby

Outline of presentation Demand-side versus supply-side financing Examples of demand side financing What are voucher schemes Potential strengths of vouchers Experiences from vouchers providing safe motherhood services Lessons learnt and conclusion

HEALTH FINANCING e.g. Tax revenue or donation SUPPLY SIDE FINANCINGDEMAND SIDE FINANCING PAYMENT ORGANISATION e.g. Ministry of Health PAYMENT ORGANISATION e.g. Voucher Agency INPUTS e.g. salaries, medicines, equipment, etc RIGHT TO SUBSIDY e.g. Vouchers, fee subsidies HEALTH FACILITIES PATIENTS Free or subsidized services Redemption of the right for subsidy PATIENTS HEALTH FACILITIES Payments Invoice for Subsidies on Goods and /or services Co-payments

Supply Side Financing ADVANTAGES Simple to introduce Cheap to administer Best when the health services are actually used by the patients who need the services DISADVANTAGES Difficult to target patients who need the services but currently do not use these Low incentive to increase the number of patients Low incentive to provide services according to the needs of the patients

Demand Side Financing (DSF) Two forms Patient gets subsidy The subsidy is given directly to the patient Health facility gets subsidy The subsidy is given to the health facility based on a contractual arrangement

Examples DSF where the health facility gets the subsidy Fee-for-service subsidy claims Referral vouchers Others, e.g. Cost-per-case contracts Capitation payments Target payments

Examples where the patient gets the subsidy Given before the health service is used Cash payment to patients Contributions to family medical savings schemes Vouchers Competitive Non-competitive Given after the health service is used Cash refunds Conditional cash transfer (incentive based voucher)

What is a voucher A document which can be exchanged for defined goods or medical services as a token of payment OR "Tied cash (as opposed to liquid cash)"

Some examples of vouchers

Voucher scheme Voucher Voucher agency Target population Health Facilities Donor/ Government $ M&E reports Step 4 Step 1Step 2 Step 3 Voucher $

Important to note Voucher programmes can contract all health facilities capable and willing to provide the services (public, mission, NGO and private health facilities) They can function hand in hand with supply side financing of the health facilities They can be used as a temporary measure to quickly increase the use of a priority services, such as safe motherhood

Strengths of vouchers Targeting of population sub-groups Encouraging use of particular services Can improve quality Can increase efficiency Payment for services which are actually provided Facilitates monitoring and evaluation

Targeting Is a strength when beneficiaries can easily be identified, e.g. Groups who fear stigmatization people with TB, Leprosy, AIDS Groups who need priority health services, but do not use them, e.g: Adolescents, young people in need of Sexual and Reproductive Health Poor pregnant women in need of safe motherhood services

Vouchers encourage use of important health services When use is limited by barriers to access (cost, lack of knowledge, cultural barriers..) Remove cost barriers (incl. eg transport and food or other costs) Vouchers inform about services and guide users to where services can be obtained

Vouchers can increase quality and efficiency Quality of services is improved because vouchers incentivise the health facility to respond to the needs of the patients: e.g. friendly services, ensuring medicines are available, equipment is working etc Efficiency is increased because only services which have actually been provided, are paid for. This can increase the number of patients using the health facility

Some examples of impact of voucher schemes for safe motherhood Kenya India Bangladesh

Kenya voucher scheme, started June 2006 Financed by the German Development Bank KfW Poor in 3 rural districts, 2 urban slums Nairobi To increase access to safe motherhood, family planning and gender based violence services Public, mission, private, and NGO providers Voucher agency is PriceWaterhouseCoopers Vouchers are sold at highly subsidized prices Over 100,000 vouchers used (especially safe motherhood vouchers)

Increase in percentage of deliveries in a health facility in Kenya

Percentage of deliveries in a health facility with and without voucher schemes (India)

Evaluation voucher scheme in Bangladesh, some findings

Lessons learnt What makes vouchers successful? Appropriate design, committed stakeholders Independent Voucher Management Agency, i.e. a third party which is able to defend the rights of the patients Efficient management procedures smooth payment of health facilities Vouchers address priority health services Vouchers address specific barriers to access health services (costs, lack of information etc)

Some potential drawbacks of vouchers Design and set-up is complex (devil is in the detail), needs training of staff at the start May be susceptible to abuse (black market of vouchers, collusion between health facilities and distributors..) Program development may take time However once established vouchers are easy to run and to scale-up, and costs go down

Conclusion I Vouchers do not replace supply side financing, but strengthen the functioning of health facilities because they motivate staff to produce more and better services

Conclusion II Vouchers are very good at increasing the use of safe motherhood services by women who currently do not use these services Great potential in helping to reduce maternal morbidity and mortality

CAMBODIA EXAMPLE IF TIME PERMITS

Cambodia voucher schemes Successful voucher scheme in MoH facilities in Kampong Cham province (Feb 2007): Targeting poor pregnant women Reduced financial barriers to deliver at facility Made health facility more responsive to women New voucher scheme financed by the German Development Bank (KfW): Three provinces providing safe motherhood and safe abortion services as well as family planning services

Results from Cambodia