1. Challenges and recent experience of countries leveraging provider payments in support of universal health coverage in Thailand
Phusit Prakongsai, MD. Ph.D.
International Health Policy Program (IHPP)
Ministry of Public Health of Thailand
Presentation to expert group meeting on provider payments
WHO Barcelona Office, Spain
27 February 2011

2. Health financing arrangements and three public health insurance schemes in Thailand after achieving UHC in 2002
Full capitation
Capitation for OP
DRG with global budget
FFSuntil 2006, DRG for IP
Direct billing FFS(2006+) for OP
Traditional FFS for OP
Source: Tangcharoensathien et al. (2010)

3. Characteristics of three main public health insurance schemes
CSMBS
SSS
UC scheme
Scheme nature
Fringe benefit
Mandatory
Citizen entitlement
Population
Gov employees, pensioners and their dependants (parents, spouse, children) 5 Million (8%)
Formal-sector private employees, establishments/ firms of more than one worker since 2002
9.84 Million (15.8%)
The rest of population who are not covered by SSS and CSMBS
47 Million (75%)
Source of finance
General tax
(~323 US$/Cap*)
Tripartite from employer, employee, government rate 1.5% of salary (max salary: 441 US$ - health care 37 US$ /Cap, total 63 US$/Cap)
(62 US$/Cap)
Management organization
Comptroller general under ministry of finance
Social security office under ministry of labor and welfare
National Health Security Office (NHSO)
Benefit package
No preventive care
No explicit exclusion
Special bed
Small number of exclusion lists
eg. Organ transplantation, non medical plastic surgery, etc
Small number of limited condition
Prevention & promotion
Payment
OP: Fee-for-service
IP: DRGs (piloted for only 2 years)
Capitation with additional payments for high utilization rate and chronic illness patients
OP: Capitation
IP: DRGs with global budget
Year 2008,
CSMBS = Civil Servant Medical Benefit scheme, SSS = Social Security Scheme, UC scheme = Universal Coverage Scheme
Adapted from: Mills et al. 2005; Srithamrongsawat S. Thammatacharee J. 2009 3

4. GNI per capita, US$ on a road towards UHC, 1970-2009

5. Historical development: provider payments
1991
Inclusive capitation
Fee-for-service (FFS) 
Mixed allocation
1993-4
Global budget
1995
Adjusted utilization
Fee-schedule: HC
1998
Per capita allocation
1999
Demand side
Piloting DRG/ Capitation
DRG system for HC
2000
control 
2001
Adjusted for risks
2002
Capitation and DRG weighted global budget
2005
Age-adjusted capitation
2006
Fee-schedule
Performance-based payment
Year
SSS
CSMBS
MWS
Health Card
Uninsured
This slide summarize historical development of payment methods in Thailand. Inclusive capitation was first introduced in 1991 by the Social Security Scheme and additional payments were added in later to collect the problem of selection bias according to free choice of beneficiaries to register with contracted hospitals.
Per capita budget allocation was first implemented by the previous Health Card scheme, a public subsidized voluntary health insurance scheme, in 1994 when the government started to provide equal matching funds for the scheme.
The Medical Welfare Scheme for the poor and other vulnerable groups also moved away from supply-side allocation formula to a per capita budget allocation later in A system of Diagnosis Related Group with global budget and capitation payments were piloted by the Medical Welfare Scheme and the Health Card scheme in 1999 and these two payment methods have been adopted as main payment methods by the UCS.

6. UHC scheme payments Basic health care ARV drug UC fund Provider RRT
Capitation in OP, DRG with global budget in IP
Population/patient
ARV drug
Fee schedule & development plan
UC fund
Provider
RRT
Fee schedule &
development plan
Chronic
(DM/HT)
Point by no of pt
Mental health
(Medicine)
Medicine supply & development plan

7. Basic health care Type Payment Out patient(general
Capitation with diff cap by age structure
In patient (general)
DRG with global budget
Special budget for special area
Cost function
OP/IP special service
Point system with global budget
P&P
Capitation, fee schedule, project based
Rehabilitation
Fee schedule, project based
Thai traditional health service
Fee schedule with global budget
Capital replacement
Capital investment plan
Quality performance
Specific criteria
No fault liability for health personal
No fault liability for patient

9. Coverage of health insurance: 1991-2003
Currently, there are three main health insurance systems which cover 95% of the Thai populations.
The Civil Servant Medical Benefit Scheme cover around 9% of the populations similar to the Social Security Scheme.
And the UC scheme covers around 47 million or around 75% of the populations.
Source: HWS 1991, 1996, 2001, 2003

10. Achievements after implementation: key financing functions

11. Decreasing regressive (OOPs) and increasing progressive sources of finance (direct tax) over time

12. Increasing share of public financing sources in Thailand after achieving universal coverage
Achieving UC
Total health expenditure during ranged from
3.49 to 4.0% of GDP, THE per capita in 2008 = 171 USD
Capitation payment for UC beneficiary in 2010 = 80 USD per capita

13. Financial risk protection 1: Household OOP as % household income, 1992-2008
As a result from the UC policy and other piecemeal approaches, the proportion of HH spending on health to income in the first decile decreased from 8.2% of income in 1992, to 2.0% in 2008, while that of the richest decile was approximately % in the same period.
Source: Analysis from household socio-economic surveys (SES) in various years , NSO

14. Financial risk protection 2: Incidence of catastrophic health expenditure 2000-2006
Source: Analysis from NSO SES

15. Trend of health impoverishment 1996-2008

16. Distribution of budget subsidies for health: BIA, 2001 and 2007
When we analyzed government subsidies on health gained by different income quintiles, we found that in 2003, the first and second quintiles gained higher percentage of net government health subsidies, compared to the situation before UC. In contrast, the proportion of the net government health subsidies in the third to the fifth quintiles decreased after implementation of universal coverage. The concentration indexes of the net government health subsidies in 2003 had a higher negative value than the subsidy in 2001, which means the poorer gained more government health subsidies in 2003 than the situation before UC.

17. Profile of government health subsidies 2004

18. Fee-for-service CSMBS experience CSMBS’ OP-IP health expenditures (1988-2010)
2006 implementation:
- IP DRG system
- OP direct billing
1997 Asian economic crisis
and conservative reform
It would reach the ‘double expenditure’ milestone every 6 years if the annual growth was 12.5%
The growth is real term, the expenditure here is a current-year nominal term.
One slide nominal term both exp and growth, another slide in real term. There is a bit of work but very useful as future reference in HCF work krub. An asset for the country krub.
Another key parameter is Baht per beneficiary comparision 3 schemes which is utmost important, perhaps in another slide krub.
Any possible explanations of -2% annual growth ? This is mainly due to slow increase in OP exp, while IP expenses were stabilized, although it's a conventional DRG where Baht per RW was given upfront. There is also limited as it is already full capacity of public hosp private wards to accommodate more admissions. If private admission is allowed, it would stir IP expenditure due to abuse and unnecessary admission.
(Expenditures in nominal term)
Source: Comptroller General Department, Ministry of Finance 18

19. Trends in Equity of Utilization of Health Facilities: (based on analysis of concentration indices) 19 19

20. Summary: achievements
Financing sources
General tax and SHI contributions constituting 2/3rd THE - are very “progressive” or pro-poor.
Marked decline in out-of-pocket expenditure to 18% of THE with elimination of rich-poor gap of OOP
Financial risk protection
Very low level of catastrophic health spending and impoverishment
Public subsidies of health facilities
Pro-poor subsidies of out patient and in patient
Utilization of health facilities
Pro-poor utilization of publicly financed out/in patient facilities
Pro-rich utilization of privately financed out/in patient facilities

21. Contributing Factors to Effective Implementation
Systems design for equity and efficiency
Prakongsai et al, the equity impact of the universal coverage policy: lessons from Thailand, in Chernichovsky and Hanson (eds), Innovations in health system finance in developing and transitional economies 2009.
Supply side capacity to deliver services
Extensive geographical coverage of functioning primary health care and district health systems
Long-standing policy on government bonding of rural services by doctor, nurse, pharmacist and dentist new graduates
Availability of quality private services for which rich either covered by private insurance or OOP, can opt out
Adequate funding
Continued political commitment despite changing political party
UC budget was estimated by actual utilization X actual unit costs projected for that year
Financial access is determined by
Comprehensive service package
Zero co-payment at registered provider network

22. The increasing health budget
77,720.7 mil. ฿
(8.1%)
16,225.1 mil. ฿
(4.8%)
986.6 mil. ฿
(3.4%)
In 2011, Public health budget rose to 13% of National budget
29,000 mil. ฿
1972
335,000 mil ฿
1,028,000 mil ฿
Using the fiscal space created by an improving security situation, along with strong economic growth and a commitment by successive governments to improving health care, the budget for health has been increased gradually and now stands at 14% of total budget. Not only has the budget increased but the health budget as a proportion of the total government budget has increased.
1990
National budget
2004
Public health budget 22 22

23. Long-term financial projection, 2006-2026 based on 1994-2005 NHA, by ILO and Thai experts in 2008

24. Contributing Factors to Effective Implementation
Strong institutional capacities
Information systems
Burden of Disease, National Health Accounts, National Drug Account, National AIDS Spending Account, national household datasets for routine equity monitoring
Health technology assessment
HITAP institutional relation with UK NICE
Key platforms for evidence informed decision
National Essential Drug List sub-committee
Benefit package sub-committee
Mandatory economic evaluation and budget impact assessment for new drugs/interventions

25. Conclusions Health systems in Thailand equitable and responsive
Full geographic coverage, well staffed and funded PHC
capacity to absorb rapid increase in utilization
translation and implementation capacity
translate policy into real actions,
M&E and feedback loops for fine-tuning policies
strong leadership with continuity,
Not only political but financial commitment
Capable technocrats
Active civil society
long term investment in institutional capacity strengthening in health policy and systems research,
Evidence generation,
Effective mechanisms for evidence informed policy decisions
First and foremost, the capacity of health service infrastructure, district health systems if the critical strategic hub in translating policy wishes into reality. It is geographically accessible by rural poor, A functioning PHC is not possible if there is no health workforce there. We introduced mandatory rural services since 1972.
Access to care is not possible without removal of financial barrier through financial risk protection policies.
It is the national health plans which ensure continuity of policies and programs.
It is the merit of different political leaders in continuing good programs,
It is the evidence which shows these programs deserve continuity.

26. Key challenges of UHC in Thailand
Data from National Health Accounts (NHA) indicate the majority of health finance was spent on curative care, and low investment in health promotion and disease prevention - only 5% of THE in 2009,
Inequitable distribution of human resources for health especially medical doctors and nurses is the key challenge in equitable access to MCH care,
Harmonization of three public health insurance schemes,
Double burden of disease (BOD) from communicable and chronic non-communicable diseases,
Aging society and increasing demand for health care,
Advance in expensive medical technologies including medicines.

27. Acknowledgements Ministry of Public Health (MOPH) of Thailand
National Statistical Office (NSO) of Thailand
National Health Security Office (NHSO) of Thailand
Health Systems Research Institute (HSRI),
Health Insurance System Research Office (HISRO) of Thailand,
World Health Organization (WHO)
London School of Hygiene and Tropical Medicine (LSHTM), United Kingdom