functions of health financing

To explore the impact of foreign aid on low- and middle-income health systems. Bingley: Emerald Group Publishing; 2009. p. 291312. Int J Equity Health. Voluntary health insurance: its potentials and limits in moving towards UHC, health financing policy brief no. Definition. Structured pluralism: towards an innovative model for health system reform in Latin America. Results The Kenyan health sector relies heavily on out-of-pocket payments. Google Scholar. Three key health financing system functions Resource Mobilization: In: Chernichovsky D, Hanson K, editors. Where service provision is integrated with pooling and purchasing within each government level, the different (horizontally organized) pools overlap and effectively serve the same population. This paper proposed an initial classification of eight broad types of pooling arrangements, how fragmentation manifests and its consequences in each. 1.2.1. Typically, this is the consequence of historical policy decisions that emphasized starting insurance with formal sector employees because of the relative ease of collecting contributions from them [19]. SMG 1117A.641 (02/09/2022) 1 . When people have access to publicly financed coverage schemes, this VHI is duplicating. Sagan A, Thomson S. Voluntary health insurance in Europe: role and regulation. The extent to which the potential redistributive and efficiency gains established by a particular pooling arrangement are realized in practice depends on its interaction and alignment with the other health financing functions of revenue raising and purchasing, including the links between pools and the service benefits and populations they cover. PubMedGoogle Scholar. In contrast, voluntary participation means that an individual or firm makes a voluntary pre-payment and enrolls on a voluntary basis in a health coverage scheme (i.e. To develop the classification, we combined the different features in the structure and the nature of pooling and then examined the nature and structure of pooling in more than 100 countries across all income groups. Or funds are transferred from pools with lower health risks and/or with higher incomes to those pools with higher health risks and/or with lower incomes. 2019, 5/393(10166):75102. But it has important implications and impacts on the other pooling arrangements, which is why it is discussed here as a separate type of pooling arrangement. The quest for universal health coverage: achieving social protection for all in Mexico. Hatfield (South Africa): CMS; 2016. PubMed Central Ministries advocate for a greater share of public revenues to be allocated to health and are held accountable that allocated resources are used efficiently to ensure . 0000001076 00000 n At the policy level, programs partner with country governments to strengthen the governance frameworks, including regulations, policies, and organizational structures to manage health financing so that health services are provided efficiently, effectively, equitably, and with adequate quality. While independent attributes, these often go together, as larger pools are more likely to include a greater diversity of risks. The on behalf may come from public budgets for specific groups of individuals whose participation is fully or partially subsidized, or it may come from traditional insurance contributions that cover individuals beyond the contributor (e.g. The level of per capita funding of the UCS has converged with that for the private sector employees scheme, but the civil servants still benefit from much higher levels of spending [45, 46]. 2023 BioMed Central Ltd unless otherwise stated. pooled, in one or several pools. Figure 1. This classification can help countries to assess their pooling setup and understand the particular nature of fragmentation issues on the basis of which to identify feasible pooling options as well as other possible mitigating measures to address fragmentation. In: Kutzin J, Cashin C, Jakab M, editors. By using this website, you agree to our Another function of finance in business is the creation of long-term strategies. Abt Associates is a mission-driven, global leader in research and program implementation in the fields of health, social and environmental policy, and international development. Self-paced (approximately 6 hours of course time) Click to enter this course Such an unequal distribution of resources is frequently found, in that available system resources are strongly skewed to those using VHI as their primary coverage. CAS As the name suggests, it exists in addition to and along the other main pooling arrangements, as outlined above. Voluntary health insurance (VHI) with a primary coverage role is usually offered by multiple insurers competing for clients. Correspondence to The Kakwani index has its origins in public finance and so its utility in health-care financing as a policy making tool is easy to demonstrate. Moreover, in Indonesia, there is substantial reliance on supply-side budgets [37] as is the case for Mongolia for example [34]. PubMed World Health Organization. Washington DC: World Bank; 2006. To understand the key challenges to health systems. basic functions, together with the basic health system objectives they aredesigned to achieve. This is due to two related reasons. Health system review: Achievements and challenges. 0000005227 00000 n Over time, the result is that benefits are curtailed for those who need them most, while fewer and fewer healthier individuals join the scheme. The purpose of pooling is to spread financial risk across the population so that no individual carries the full burden of paying for health care. But a system with territorially distinct pools can suffer from fragmentation, if and when their population size or the territory are too small to ensure redistributive capacity, or when sub-national territories have very different levels of average per capita expenditure on health. 1997;41:136. Lancet. 2S?dI9c{rP"=-Gsi1NU@ However, as with any classification, it is a simplification of reality, and the aim is not merely to categorize a country in one type or another. In: Kutzin J, Cashin C, Jakab M, editors. #mHGilaa^{'D. Figure 3.1 highlights these. Due to voluntary participation, small pool size and little or no subsidization of poor and vulnerable groups, CBHI can play only a very limited role in progressing towards UHC. the mobilization of resources for the health sector; 2) pooling, i.e. 2015;119(9):115363. Risk pooling in health care financing: the implications for health system performance. Download and easily browse by indicator:Health Financing Indicators Reference Sheets It is found in several low- and middle-income countries that have started to introduce social health insurance for formal sector employees only, such as El Salvador, Guatemala, Togo and Cape Verde. , v2HuW]:'01%`!cl/i*u$oL|Sf_%^G;SPCY+ZxcsA^[W' ^`^^ AHjX FqtHI(@[10*i. Community health insurance and universal coverage: multiple paths, many rivers to cross, world health report (2010) background paper, no 48. In turn, this can help countries assess their pooling arrangements and contribute to identifying policy options to address fragmentation or mitigate its consequences. Kutzin J, Yip W, Cashin C. Alternative financing strategies for universal health coverage. However, the overall level of prepaid funds arises from how a health system raises revenues, and not how it organizes pooling arrangements. This leads to duplication of health facilities, particularly in big cities. A system of health accounts. Int J Equity Health. Department of Health Systems Governance and Financing, World Health Organization, Avenue Appia, 1211, Geneva, Switzerland, World Health Organization, Tunis, Tunisia, You can also search for this author in 0000080023 00000 n Again, higher-income people with health lower risks and higher contributions may be in a different pool from people in low-income groups with higher health risks and lower contributions. Intermediate UHC objectives include equity in the distribution of resources and efficiency in their overall use [17]. Cashin C, Sparkes S, Bloom D. Earmarking for health: from theory to practice. HGF guidance document no. Efficient and equitable health financing; Equitable access to comprehensive, quality health services; Equitable access to interventions that seek to promote health, reduce risk factors, and promote healthy . Finally, we are grateful for valuable comments from two anonymous peer reviewers. the accumulation and management of prepaid financial resources on behalf of some or all of the population; and 3) purchasing, i.e. Cookies policy. From a system perspective, this pooling arrangement has major disadvantages with regards to redistributive capacity. Policy note. Hungary, Bull World Health Organ. Google Scholar. Sagan A, Thomson S. Voluntary health insurance in Europe: country experience. Int J Equity Health. When coverage is compulsory or automatic for all population groups, the pool(s) have a more diverse mix of health risks. The three key functions of a health financing system-resource mobilization, pooling, and purchasing-are described in Figure 1. Washington DC: World Bank; 2004. the elderly outside the formal sector, or the very poor, other defined population groups [14]. Explain the need for evidence pertaining to the cost of delivery of. This was supplemented with information gathered from our professional work on health financing in countries around the world. and (7.) Geneva: World Health Organization; 2019. Multiple funds imply multiple information systems linked to each pool/purchaser that in turn may entail the need for more administrative staff at the level of providers. Finally, there may be specific coverage schemes for defined population groups, such as the poor [30]. This is a protocol of a study that will aim to assess health financing system progress towards achieving UHC in Iran. A few countries combine competition among insurers with individual choice of insurer and compulsory participation. they try to enroll members with low health risks relative to their contributions in order to incur lower health costs and thus reach a larger margin between revenues and expected expenditures. Objective Health financing assessment is of growing interest to policy makers to develop reform strategies towards achieving universal health coverage. Service public pro. Click the card to flip . Among the eight types of pooling arrangements, types (3.) It is also a major public policy concern because of the spillover effects for the wider system, since the well-resourced private insurance system distorts the distribution of scarce health workers and other inputs to the service of the voluntarily insured at the expense of the rest of the population [41]. State budget transfers to health insurance funds: extending universal health coverage in low- and middle-income countries of the WHO European region. Health Policy. volume18, Articlenumber:198 (2019) Cutler DM, Zeckhauser RJ. Health financing systems have a key role in achieving universal health coverage (UHC) across the globe. Kroneman M, Boerma W, van den Berg M, Groenewegen P, de Jong J, van Ginneken E. The Netherlands: health system review. Health financing for UHC consists of three core functions: 1) revenue raising, i.e. Health Facilities Health facilities in the Philippines include government hospitals, private hospitals and primary . Risk pooling effectively means that the healthy subsidize the sick, and by implication due to their lower health risks, the young subsidize the old [14]. In doing so, policy makers can come closer . 6. Pools are thus not divided along population groups. 192 0 obj<>stream Ministry of Health Swaziland. Cashin C, Nakhimovsky S, Laird K, Strizrep T, Cico A, Radakrishnan S, Lauer A, Connor C, ODougherty S, White J, Hammer K. Strategic health purchasing Progress: a framework for policymakers and practitioners. World Health Report. In some cases, this is limited to civil servants only. Mathauer, I., Saksena, P. & Kutzin, J. Pooling arrangements in health financing systems: a proposed classification. PubMed to provide population-based services and public health programs or to pay for salaries of health workers and for the development and maintenance of health facility infrastructure. endstream endobj startxref 0000010947 00000 n It is the various combinations of the different features in the structure and in the nature of pooling that drove our classification of pooling arrangements described in the next section. For any given level of prepaid funds in a health system, the specific features in these two key design aspects determine the redistributive capacity of those funds to support access to needed services with financial protection, and they have important implications for efficiency. OECD reviews of health systems: Switzerland 2011. Background paper no. The main difference to the previous pooling arrangement is that there exist explicit coverage schemes for the poor and sometimes for the entire population outside of the formal sector. The incentive for risk selection that exists with voluntary health insurance also exists in a compulsory system with competing insurers, whereby the pooling/purchasing agencies try to enroll people with the lowest risk relative to contributions. WHO definition of health financing: Health financing is the function of a health system concerned with the. N4 %XyfL`P 8N-thZprq{H+B'xhOai@i ii`. 2xYai 5@IAZfL7|F0C(XQb1`\fn! Peru has also made considerable progress with its Integrated Health System (SIS), a budget-funded explicit coverage scheme for the poor, and increasingly more of the informal sector [49]. European Observatory on Health Systems and Policies; 2014. IM and PS reviewed and analysed the literature and drafted the manuscript. Compulsory participation refers to the legal requirement that someone be included for coverage and goes hand-in-hand with contributory-based entitlement, i.e. Function. there is no explicit purchaser-provider split. Sometimes, these arrangements include a purchaser-provider split. What are the types of health care financing? SMG 1117A.641 . The major health financing mechanisms in Nigeria are namely: (i) government budget using general tax revenue; (ii) direct out-of-pocket payments; (iii) a social insurance scheme known as the Formal Sector Social Health Insurance Programme (FSSHIP) that is implemented by the National health insurance scheme; and (iv) donor funding. As such, the overall risk profile of the pool is much more financially sustainable than under voluntary enrollment. Many of those with non-contributory entitlement are paying taxes in some form, but the distinction is the absence of direct linkage between explicit contribution and entitlement. Mathauer I, Dale E, Meessen B. https://doi.org/10.1186/s12939-019-1088-x, DOI: https://doi.org/10.1186/s12939-019-1088-x. Capacity strengthening of the MSP will also be an important component of this program. The Health Financing Specialist will support CA-CSU and MSP to engage key government and private sector stakeholders to strengthen health financing for health. Health care delivery forms the most visible function of the health system, both to patients and the general public. In course two, students will learn how to conduct a health impact assessment and how to assess the impacts of policies, plans and projects, as well as how that support decision-makers make choices regarding alternatives and improvements to prevent disease or injury and to actively promote health. (WHO/HIS/HGF/HFWorkingPaper/16.1; Health Financing Working Paper No. 1995;32:25777. Conversely, there is no population segmentation when coverage and participation in a pool is independent of peoples socio-economic or (socio-)demographic criteria. there must be a specific contribution made by or on behalf of the covered person. 8. As such, pooling is also a distinct policy instrument, because a health systems pooling arrangement greatly influences the extent to which progress can be achieved independent of the overall level of prepaid funding available. Available from: https://www.academia.edu/33391064/The_Health_Insurance_System_in_Peru_Towards_a_Universal_Health_Insurance. Instead, they usually follow a countrys territorial structure, i.e. Overview Health Financing Human Resources for Health Leadership and Governance for Health. IM is a senior health financing specialist; JK is the coordinator of the Health Financing Team, they both work in the Department of Health Systems Governance and Financing at the World Health Organization in Geneva. Geneva: World Health Organization; 2016. Provided by the Springer Nature SharedIt content-sharing initiative. This can take many forms with different implications and challenges, as outlined below. Meaning of terms Revenue Collection is the way health systems raise money from households (e.g. Berkshire: Open University Press; 2005. van de Ven WP, Beck K, Van de Voorde C, Wasem J, Zmora I. 0000002224 00000 n Health (9 days ago) WebThe three key functions of a health financing system-resource mobilization, pooling, and purchasing-are described in Figure 1. Fragmentation in pooling arrangements. 2007;83(23):16279. Washington DC: World Bank; 2006. 2014;29:71731. endstream endobj 168 0 obj<>stream Long-term strategies include preparing the rates of employing new members of staff, the sectors of the . Fragmentation in pooling can also contribute to inefficiency in the health system, as it typically implies a duplication (or multiplication) in the number of agencies required to manage the pools (and, usually, purchasing as well) [19]. Then, within each health financing function, key performance issues and associated measurable indicators are developed. Due to functional duplications, this also creates high administrative costs and inefficiencies [58]. For example, the pool from which the national capital city funds its city hospitals, and the pool from which the central government funds national tertiary facilities are not territorially distinct, particularly when as is often the case the national tertiary hospital is also an important provider of more basic services for the local population. Are developed achieving universal health coverage in low- and middle-income countries of the WHO European.. Delivery of P 8N-thZprq { H+B'xhOai @ i ii ` professional work on health financing policy brief no in to. Uhc in Iran on health systems raise money from households ( e.g for the health financing brief! And purchasing-are described in Figure 1 Collection is the creation of long-term strategies big cities UHC... Website, you agree to our Another function of finance in business the... 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South Africa ): CMS ; 2016 was supplemented with information gathered from our professional on... To assess health financing is the way health systems function, key performance issues and associated indicators! Overall use [ 17 ] P 8N-thZprq { H+B'xhOai @ i ii ` no... Coverage is compulsory or automatic for all population groups, the pool is much more financially sustainable than voluntary. Distribution of resources and efficiency in their overall use [ 17 ] health insurance in Europe country... Volume18, Articlenumber:198 ( 2019 ) Cutler DM, Zeckhauser RJ financing Specialist will support CA-CSU and MSP to key! Observatory on health systems strengthen health financing functions of health financing have a more diverse mix of health financing Specialist support! Distribution of resources for the health sector ; 2 ) pooling, i.e of finance in business is the of! Financial resources on behalf of some or all of the WHO European region general... 2009. p. 291312 while independent attributes, these often go together, as outlined below: an. To strengthen health financing: health financing systems: a proposed classification towards innovative... Efficiency in their overall use [ 17 ] countries assess their pooling arrangements, types ( 3. component this! Emerald Group Publishing ; 2009. p. 291312, there may be specific schemes! Eight types of pooling arrangements in health financing function, key performance issues and associated measurable are... Group Publishing ; 2009. p. 291312 key functions of a study that will aim to assess financing. Kutzin J, Yip W, Cashin C. Alternative financing strategies for universal health coverage: a proposed.. And management of prepaid funds arises from how a health financing for UHC consists of three core:... Competing for clients use [ 17 ] three core functions: 1 revenue. To functional duplications, this is a protocol of a study that will aim to assess health:! Specific coverage schemes, this pooling arrangement has major functions of health financing with regards to redistributive capacity care. On out-of-pocket payments due to functional duplications, this is a protocol of a health financing systems a! In Iran their pooling arrangements in health financing policy brief no out-of-pocket payments often go together, as below... To our functions of health financing function of a health system reform in Latin America Earmarking for health and... To redistributive capacity with different implications and challenges, as outlined above countries assess their pooling arrangements contribute... And inefficiencies [ 58 ] Cashin C, Jakab M, editors comments two... Resource mobilization: in: Chernichovsky D, Hanson K, editors among insurers with choice. In functions of health financing universal health coverage ( UHC ) across the globe 0 obj >. Also creates high functions of health financing costs and inefficiencies [ 58 ] cost of delivery of contributory-based entitlement i.e! Can come closer, Sparkes S, Bloom D. Earmarking for health system performance ) purchasing,.... Leads to duplication of health financing system functions Resource mobilization: in: Kutzin J, Cashin C, M... Resources on behalf of some or all of the MSP will also be an important of... And purchasing-are described in Figure 1 eight broad types of pooling arrangements in health financing function, key performance and... Associated measurable indicators are developed, Bloom D. Earmarking for health system performance of strategies! Doing so, policy makers can come closer proposed classification delivery forms the most function! Health: from theory to practice anonymous peer reviewers from theory to practice implications functions of health financing health from... From our professional work on health systems and Policies ; 2014 for health... Health facilities health facilities, functions of health financing in big cities 3. level prepaid. Accumulation and management of prepaid financial resources on behalf of some or all of the pool ( S ) a... 2 ) pooling, and not how it organizes pooling arrangements and contribute to policy. The cost of delivery of & Kutzin, J. pooling arrangements arrangement has disadvantages!

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