Dr. Shiyan Chao Health Care Conference Aruba June 1-3, 2015 Health System in Small Island Nations Challenges and Options

Outline 1 Health System in Small Island Countries 2 Economic Analysis of a Health System 3 Lessons learned from the Carribbean 4 Options for improving health care

The goals of health systems The WHO Health System Performance Framework defines the goals of health systems as: – Improving the health of the population they serve – Responsiveness, i.e., responding to people's legitimate expectations – Fair financing, i.e., providing financial protection against the costs of ill-health.

Responsiveness Defined as a measure of how well the health system responds to the legitimate expectations of the population An increasing challenge for all: – How to define quality of care – Necessity for some and luxury for others – Demand and expectation will increased as aging population and development of medical technology.

Fairness in Financing Every member of society should pay the same share of their disposable income to cover their health costs. Universal access and universal coverage – – On paper – In reality

General Health Financing Functions and Objectives Revenue collection Raise sufficient and sustainable revenues in an efficient and equitable manner Pooling Reduce Risks Manage these revenues equitably and efficiently Purchasing Provide essential services which improves health outcomes and provides financial protection and consumer satisfaction

8 Revenue Risk Purchasing Collection Pooling There are Many Ways to Finance a Health System Private Public Taxes Public Charges/ Resource Sales Mandates Grants Loans Private Insurance Communities Out-of-Pocket Public Providers Private Providers Service Provision Government Agency Social Insurance or Sickness Funds Private Insurance or Community-based Organizations Employers Individuals And Households Source: World Bank

Common Health Financing Models National Health Services System Social Health Insurance Private Voluntary (mandatory) Health Insurance Community-based health Insurance Director purchase by consumers (user fees)

Evolution of Health Financing Systems 10 PatientOut-of-Pocket Social Insur Gov’t Budget Social Insur Patient Out- of-Pocket Priv. insur Low Income Countries Middle Income Countries High Income Countries National Health Service Mandatory Health Insurance PrivateInsurance Source: Modified from A. Maeda CommunityFinancing Patient Out- of-Pocket Government Budget/MOH

Total Health Spending as a Share of GDP Relative to Income 11

Government expenditure on health (including external financing) already major part of government expenditure Source: World Development Indicators (2014)

Focusing on resources allocation and purchasing For whom to buy What to buy From whom How to pay At what price Implications to small nations

Common Vulnerabilities in Small Economy Susceptibility to nature disasters and climate change Economies vulnerable to exogenous shocks Economically less diversified Often rely on import of basic goods and supplies

Challenges in providing health services with in a Small Nation (less than 2 million population) Limited infrastructure for providing all services needed It is not economically and technically viable to provide all services needed Limited human resources to provide all services needed Brain drain in health work force Limited capacity in administration, management and research for efficiency gains

Lessons Learned from the World Bank’s Operations in the Caribbean Individual country development vs. regional development Collaboration in infrastructure planning Collaboration in sharing technical expertise Sharing financing mechanisms (?) Innovations in sharing and utilization resources (some examples)

Priorities in Health Care Easy access to quality care Quality of health care: advanced technology equipment, skilled health professionals Equitable coverage Choices of care Risk sharing and protection Sustainability

Future health care in small island nations will be expensive Island populations are increasingly heavier; NCDs are growing Populations are aging Financing resources are not necessarily predictable Unmet expectations can be high

Institute for Health Metrics and Evaluation, Human Development Network, The World Bank. The Global Burden of Disease: Generating Evidence, Guiding Policy – Latin America and Caribbean Regional Edition. Seattle, WA: IHME, 2013.

1.In 1990 Diarrheal Diseases ranked No. 1 and in 2010, it ranks No In 1990 Forces of nature ranked No. 174 and in 2010, it ranks No. 2 Top 5 burden of diseases In Heat diseases 2.Forces of Nature 3.Violence 4.Road injury 5.Major depressive disorder 20 Changing of Burden of Diseases in Latin America and the Caribbean

An example of understanding burden of diseases

Diabetes a particularly severe problem Source: WDI, 2014

Treating NCD is Costly

Two Priorities for Dutch Caribbean Health Systems Improve efficiency (quality results with lower costs) Contain Costs (managing increased demand with in resources available)

Options for efficiency improvement Managed care model: – controlled and limited choices of service providers – Referral system – Managed competition Strategic purchasing – Provider payment methods: per case, DRGs – Defined benefit packages

On cost control Knowing the costs and efficiency improving prevention efforts Strengthening primary health care Developing self-management programs –keeping patients out of hospitals Developing new approaches

Possible Future development Tele-medicine, Telementoring, Telesurgery; Telepsychiatry; Telenursing, Telepaediatrics; Home Health Medical Tourism: Can your country take a share?

“Medical Practice in the Caribbean will be marginalized in the medium term as competition now involves e—health solutions overseas such as online pharmacies, therapies …” Professor Davidson Head of School of Public Health and Health Technology in Jamaica

Key Messages More resources do not necessarily produce desired health results New direction for cost-effective care: – Patients play a central role in health management – Take advantages of the communication and technology advancement Improving sustainability requires do more with less, seeking for better solutions at lower costs

Thank You!