1. Financing Maternal Health Services: An overview of approaches
Laurel Hatt, PhD
Health Systems 20/20
Abt Associates Inc.
September 9, 2010
Global Health Council

2. Outline Why does maternal health financing matter?
Key approaches and case studies
Big picture conclusions

3. Why does health financing matter for maternal health?
Raising money for eclampsia care in Burkina Faso:
“My father asked for part of it at the mosque, and my mother also asked for some and then we added our 5,000 F [savings]... my mother got 1,000 F from one person and 1,000 from another, 1,500 from yet another. We had a bit of maize that we sold. I had three cloths and I sold these and added it all up and had 15,000 F, which we went to give [to the hospital].”
Storeng K, Baggaley R, Ganaba R, Ouattara F, Akoum M, Filippi V. (2008). Paying the price: The cost and consequences of emergency obstetric care in Burkina Faso. Social Science & Medicine 66:

4. Why does health financing matter for maternal health?
Access to safe motherhood services
Barriers – “3 delays”
Desire to avoid costs  delayed decision to seek care
Finding money for transport  delayed arrival to facility
Raising money to pay for hospital care  delayed admission to hospital
Home births have no transportation costs, lower time costs, fewer fees for care providers, no unofficial payments, and are potentially less burdensome to the family than facility-based births. How can we change the incentives?

5. Why does health financing matter for maternal health?
Financial protection
Catastrophic expenditures
Maternal care can be very expensive, especially if there are complications
Raising money for care can create future risks (going into debt, selling assets, cutting spending on essentials)
Impoverishment – costs can force a family into poverty
Economic, social, health consequences for the family
Normal delivery: Direct costs range from 1-5% of annual household expenditures
Doesn’t include transport, time costs, hotel, food
Complicated delivery: 5-34% of household expenditures
What makes up those costs?
Transportation (can be up to 50% of total)
Service delivery (room charge, provider fees, drugs, supplies, lab tests, food)
Drugs can be 35-55% of service charges
Informal or under-the-table payments
Opportunity costs of time lost – for the woman, for her caregivers

6. So what are the options? Fee exemptions Insurance
For deliveries
For C-sections
Insurance
Community-based health insurance
National/social health insurance
Demand-side financing
Vouchers
Conditional cash transfers

7. User fee exemptions

8. User fee exemptions
User fees can be a significant barrier to access, especially for the poor
Demand for delivery care goes down after fees added
User fees hurt the poor more
But user fees can represent a substantial proportion of health financing at the facility level (15-40%)
May be especially important for covering recurrent costs – supplies, drugs – and avoiding stock-outs
Provide “top-ups” to underpaid staff
Poor: represent a larger portion of their income
Demand for normal delivery care goes down most

9. User fee exemptions: Ghana
User fees for deliveries were abolished over
Results:
Higher skilled attendance rates
Increases greatest among poorer quintiles, less educated women
Lower out-of-pocket (OOP) payments
Rich benefit more than poor in proportionate terms
Decrease in incidence of catastrophic payments
Especially for C-sections
Especially among the poorest
HIPC Debt relief funds were channeled to districts to reimburse public and private facilities
12% -- Central
5% -- Volta – more rural area
Catastrophic expenditures: Delivery expenditures >2.5% of income
(decrease of 22% [richest] vs. 13% [poorest])

10. User fee exemptions: Ghana
Source: Witter et al. (2009), Providing free maternal care: Ten lessons from an evaluation of the national delivery exemption policy in Ghana. Global Health Action.

11. User fee exemptions: Ghana
Challenges:
Quality of care problems
Some decreases in quality of care measured; overall facility quality is very low
Funding shortages
Government did not obtain debt relief funds in 2005
Severe under-funding as exemptions were extended beyond pilot regions
Fees were reinstated in many areas
Facilities built up debt waiting for reimbursement for care already provided
QOC assessment scores significantly decreased in Volta region – quality either unchanged or decreased
Morestin F & Ridde V (2009). The abolition of user fees for health services in Africa Lessons from the literature. Université de Montréal.
“In Ghana, for as long as the compensatory funds were available, administrators of health facilities were relieved to no longer have to pursue women unable to pay for their deliveries. However, as the compensatory funds became inadequate, health facilities became indebted to their suppliers, to the point where some had to reinstate payment from women for deliveries.”

12. Fee exemptions for C-sections: Mali
Free C-section policy announced July 2005
Normal deliveries still have charges (up to $14)
Facilities compensated for lost revenue
Kits with drugs, supplies and other consumables for C-sections
Reimbursed on actual costs of hospital stay: Up to $60 for each case
Very low C-section rate in Mali: 1.6% (DHS 2006)
MMR between 400 and 600
Under 5% indicates low access to obstetric care to reduce maternal mortality
Under 2% indicates extremely low access
Included cost of surgery, drugs, lab tests, and hospitalization; excluded transport, except to referral facility)

13. Mali: Clear increase in C-section rates over time
Source: Health Systems 20/20, Abt Associates 13

14. Fee exemptions for C-sections: Mali
Use of C-sections more than doubled,
But 2.33% rate is still very low
No evidence of increase in unnecessary C-sections
Clear possibility of perverse incentives
Challenges:
Financial and quality barriers to facility-based normal delivery care remain
Transport barriers from villages to first-level facilities
Poor communications and referrals systems between first and higher-level facilities
Optimal rate: 5% to 15% (AMDD Working Group on Indicators 2004)
Rates still less than 1% in several regions
Preliminary results indicate that the “free caesarean” policy is supported by health facility staff, and
staff shortages and supplies stockouts have not posed a major problem.
However, four key issues contribute to limited access to institutional deliveries and caesarians despite the subsidy program:
difficulties with travel from villages to first level facilities,
poorly functioning communications and referral systems between first and higher level facilities,
financial barriers to delivering in health facilities (deliveries are not free) and
perceptions of low interpersonal quality of delivery care.

15. Challenges with user fee exemptions
Providers find ways to compensate for lost revenue
Costs may be passed on or shifted to other services to make up the difference
Poorer quality, unofficial fees  patients may turn to private sector
More stock-outs may mean consumers have to pay for drugs elsewhere
Nonfinancial barriers remain (incl. transportation)
Targeting is difficult
Exempt everyone – rich benefit most?
Exempt only the poor – how do you identify them? How to avoid stigmatization?
“The more or less transitory problems having to do with quality of services (particularly shortages of medicines), excessive workload for health care workers, and patients turning to paid services when the free services are overloaded are not related to the abolition of fees as such. Rather, they are due to inadequate implementation; despite the laudable efforts of government, implementation has often been precipitous, the required resources poorly planned and not available, and follow-up lacking.”
Morestin F & Ridde V (2009). The abolition of user fees for health services in Africa Lessons from the literature. Université de Montréal.

16. Insurance

17. Community-based health insurance
Nonprofit schemes providing risk pooling to cover some portion of health care costs
Often rooted in traditional solidarity mechanisms
Usually emphasize participatory decision-making and management
Membership is voluntary
Community decides what services to cover
Usually target the “informal sector,” those excluded from formal social protection systems
West Africa – Senegal, Mali, Ghana, Benin, Guinea, Cameroon
Eastern Africa – Rwanda, Ethiopia, Tanzania
China

18. Community-based health insurance: What works?
Can improve access to health care, especially services highly valued by community (like delivery care)
Can improve financial protection for groups excluded from traditional insurance
Can replace user fees, while maintaining fee revenue for health facilities
Increased emergency obstetric care (EmOC) coverage?
Inventory of schemes in West Africa (2003) found that 55% included coverage for C-section
Delivery care (esp. referral care) is one of the most commonly covered services by CBHI schemes
People can seek care when they need it, and tend to seek care earlier
– avoid stock-outs, reduce informal fees

19. Community-based health insurance: What are the challenges?
Low population coverage (with exception of Rwanda) – lots of pilots, not much scale-up
Typical private insurance problems: small risk pools, adverse selection
Management challenges – volunteer, unskilled staff
Low revenue generation potential if all members are poor – often need subsidies to be sustainable
Concept of insurance may be alien; people want “something” for their money
Effective insurance requires real technical expertise

20. Community-based health insurance: Mali
Positive evidence:
Pregnant women who were scheme members were more likely to have at least 4 ANC visits (58%) than non-members (35%)
More likely to receive malaria prophylaxis (79% vs. 60%)
More likely to sleep under an insecticide-treated net (60% vs. 35%) – promoted by the scheme
No evidence of increased skilled attendance rates
In Mali, a process extending health insurance coverage has been envisioned, with components including workers in the formal and informal sectors as well as those who are financially unable to access health care. In collaboration with World Bank and the Ministerial Leadership Initiative (MLI)[1], Health Systems 20/20 has already supported the Government of Mali to develop a CBHI strategic plan and five-year workplan for the informal sector.
Source: Franco L, Simpara C, Sidibe O, Kelley A et al. (2006). Equity Initiative in Mali: Evaluation of the Impact of Mutual Health Organizations on Utilization of High Impact Services in Bla and Sikasso Districts in Mali. Partners for Health Reformplus, Abt Associates Inc., Bethesda, MD.

21. National or social health insurance
Pros: Can be comprehensive
Universal insurance coverage with basic package of health services –including maternal services
Can include coverage for normal and/or surgical delivery care
Cons: Complicated
Need functional tax collection systems, claims processing systems, effective/feasible provider payment mechanisms
Politically challenging to implement
Potential cost escalation – how to control?
Some low-income countries are experimenting and/or implementing:
Ghana, Rwanda, India, Nigeria …
National vs. social -- different funding and service provision arrangements
National health insurance:
Funded through general tax revenues
Government is the insurer, may directly provide services
Social health insurance:
Funded through payroll taxes (like Social Security)
Separate social security agency(ies) are the insurers
Contracts with public and private providers

22. National health insurance: Ghana
2005: Ghana rolled out the National Health Insurance Scheme (NHIS)
Goal: Universal coverage for basic services
Goal: Financial protection from health care costs
No fees for maternal health care
By 2008: 61% of population enrolled
Wealthy much more likely to enroll than the poor
Concerns about equity, cost escalation and financial sustainability
70% of the population is exempt from premiums
Most funding comes from sales taxes (regressive)
Goal: Universal coverage for basic services
Funding: sales tax, payroll tax, registration fees and sliding scale premiums ($5-30/year)
Top quintile almost 3 times as likely to enroll as poorest quintile
70% are exempt from premiums
53% of women who delivered in 2007 paid nothing

23. National health insurance: Ghana
HS20/20 impact evaluation ( ):
Improved financial protection for maternal health care services
OOP expenditures decreased for ANC, delivery care
Insured women pay 1/6 of what uninsured pay
Institutional delivery rates did not change (54.4% vs. 54.9%) WHY?
Those most likely to enroll in health insurance were already more likely to deliver in a facility
Poor quality of care in facilities
Problems reimbursing facilities
Non-financial barriers remain – distance, cultural factors
Source: Sulzbach S, Chankova S, Hatt L et al. (2009). Evaluating the Effects of the National Health Insurance Act in Ghana: Final Report. Health Systems 20/20, Abt Associates Inc., Bethesda, MD.

24. National health insurance: Ghana
But: recently some more positive signs –
2008: Pregnant women were exempted from NHIS premiums and registration fees
2010 evaluation (draft*): Preliminary signs that NHIS enrollment is beginning to increase rates of skilled birth attendance and institutional delivery.
Conclusions?
May just take time for measurable impacts to occur
May need to specifically prioritize / emphasize / publicize MH benefits within the insurance program
Design, provider payment, operations, quality – all matter.
Also:
Ghana National Development Planning Commission survey (nationally representative, 2008) found that 70% of deliveries in past 12 months took place in health facilities, compared with the MICS 2006 results (50% of deliveries).
*Agar Brugiavini and Noemi Pace (2010 draft), Extending Health Insurance: Effects of the National Health Insurance Scheme in Ghana. Ca’ Forscari University of Venice Department of Economics.

25. Demand-side financing

26. Why demand-side financing?
Traditional (supply-side) financing not very successful in increasing access of poorest women to quality care
Input-based subsidies may go to the better off (leakage)
The poor face more demand-side barriers – service costs, transport costs, distance from skilled providers, lack of knowledge or information about services
Demand-side financing: Get the money (and services) directly to the people who need them.
Supply side financing: (government subsidies are paid to providers)

27. Vouchers and Conditional Cash Transfers
Vouchers: subsidies paid directly to a consumer – like a coupon
Can subsidize a specific health care service (ANC visit), or related services or goods (drugs, transportation, food)
Can target to specific populations
Conditional cash transfers (CCTs): cash payments to individuals or households, contingent upon use of particular services
Payment is made after the desired behavior is carried out – although service use may increase, access does not necessarily increase
Can be from public or private source
Entitles consumer to free or discounted service(s) from approved providers

28. Vouchers and CCTs: Bangladesh
Pilot program – Vouchers for ANC, delivery care, emergency and postnatal care (PNC); cash incentive for delivery with qualified provider; transportation reimbursement
Distributed to pregnant women by health field workers
Combined with some supply-side incentives to providers
2009 evaluation* results:
45 percentage point higher skilled attendance rates in intervention vs. control areas
Significantly higher rates of ANC, institutional deliveries, PNC
No difference in C-sections
Significantly lower OOP expenditures
Laying the administrative groundwork for large-scale health insurance schemes (accreditation, quality assurance, claims processing)
*Hatt, Laurel, Ha Nguyen, Nancy Sloan, Sara Miner, Obiko Magvanjav, Asha Sharma, Jamil Chowdhury, Rezwana Chowdhury, Dipika Paul, Mursaleena Islam, and Hong Wang. February Economic Evaluation of Demand-Side Financing (DSF) for Maternal Health in Bangladesh. Bethesda, MD: Review, Analysis and Assessment of Issues Related to Health Care Financing and Health Economics in Bangladesh, Abt Associates Inc.

29. Vouchers – Advantages
Target specific groups or areas – get access directly to the people who need it most
Demand creation – simply by distributing vouchers with information about services
Can cover transport costs as well as service costs
May improve quality and reduce costs – by making providers compete for voucher customers 29

30. Vouchers – Challenges May have high administrative costs
Targeting can be difficult and costly
Sudden increase in demand can overwhelm facilities
Could skew service provision towards voucher services, away from other valued priorities
Sustainability? (generally donor-financed thus far) 30

31. Conditional cash transfers – Advantages and Challenges
Consumers can use the cash as they see fit – independence, poverty reduction
Could result in overall improvement in welfare, not just health status
Verification of conditions can be expensive, time-consuming
Opportunities for corruption/fraud
How do people use the money?
Example: JSY in India
Lancet article on JSY program in India –

32. Lessons learned

33. So what can financing interventions do to improve maternal health?
Increase skilled attendance at delivery
Provide access to EmOC
Prevent delivery care and EmOC from causing catastrophic expenditures
Reduce financial barriers to transportation

34. …and what can’t they do? Easily reach the poorest of the poor
Erase problems with insufficient infrastructure and poor quality services
Eradicate geographical and cultural barriers, which are often more intractable than financial barriers

35. Health systems strengthening is key
Success of a financing scheme is not just based on the financing mechanism, but on all elements of health system functioning
Accessible health facilities
Human resources – staff, skills, motivation
Quality of care
Logistics, supplies, equipment, infrastructure
Political will and leadership
Cultural shifts / behavior change

36. Thank you! Laurel_Hatt@abtassoc.com
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