Russian Federation: Linking Health, Poverty and Economic Growth Jack Langenbrunner The World Bank Moscow July 2004

2 Why Invest In Health? Poverty and Ill-health are intertwined Poorer health outcomes in/within poorer countries Poverty breeds ill-health (due to diet, education, transportation, etc) Ill health keeps poor people poor Invest in health: reduce ill health and poverty

3 Why Invest in Health? Impact on Economic Growth Macro-Economic Commission on Health 10% increase in life expectancy = 0.35% growth in GDP Productivity 17% of productivity gains attributable to health status Poor Outcomes Sick leave, absenteeism, etc.

4 Health Status Varies by Income

5 Russia vs. Canada: Health Status

6 Poorer Groups: More Likely to Engage in Risky Behaviors Vodka Cognac Liquers Other Spirits Several times per week or daily

7 Russian Federation: General Health Status

8 Probability of Russian Man Dying, Ages 15-60

9 Re-Emergence of Infectious Diseases: AIDS 60% Years old 2.3 million by % drop in GDP by 2020 Larger drops in labor supply and investments

10 Regional Variations Growing (Infant Mortality)

11 Finance and Delivery System: Reform Needed  Access to Services  Social Solidarity/Risk Pooling  Efficiency in Delivery  Equity  Protection of Poor and Vulnerable Groups Pensioners

12 Limited and Declining Public Sector Funding for Health

13 Selected International Comparisons: Levels of Funding (% Share of GDP)

14 Fragmented Funding Streams RussiaInternational Best Practice DoctorHospital Budget FundRayon Pooled Funds DoctorHospital

15 Inefficiency: Too Many Beds and Physicians

16 Too Much Reliance on Hospital Care (admissions/1,000)

17 Geographic Inequity: Over 7-fold Regional Variation in Funding (even after adjusting)

18 Impact on Poor and Vulnerable Groups

19 NOBUS Survey (1): Poor Pay More as % of Consumption

20 NOBUS Survey (2): % of Consumption for Paid Services

21 NOBUS Survey (3): Poor Can ’ t Afford to Follow Treatment Regimens

22 Recommendations Formalize informal payments 1. Formalize informal payments Standardized co-payment system Explicit protections for the poor and medically vulnerable groups Inform and educate Restructure financing and delivery system 2. Restructure financing and delivery system pooling, geographic formula, autonomize facilities, etc. pooling, geographic formula, autonomize facilities, etc. Improve Measures for Public Health 3. Improve Measures for Public Health Cross sectoral strengthening Cost-effective practices and behaviors Increase funding for AIDS and lower price of ARVs