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Making health service work for the poor: incentives for strengthening health systems performance. Berlin, 8-10 July 2002 Orvill Adams Director, Department of Health Service Provision Evidence and Information for Health Policy. Overview. Policy makers and the public need information

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making health service work for the poor incentives for strengthening health systems performance

Making health service work for the poor:incentives for strengthening health systems performance

Berlin, 8-10 July 2002

Orvill Adams

Director, Department of Health Service Provision

Evidence and Information for Health Policy

overview
Overview
  • Policy makers and the public need information
    • New data sources
    • New indicators and measures
  • Service provision needs to be more efficient
    • through information & accountability
    • through direct incentives
what policy makers need to know
What policy makers need to know
  • Identification of the population at risk - the poor
  • Health conditions of the poor
  • Degree to which interventions are reaching the poor
  • information on provider characteristics and costs
who response
WHO response
  • Populations surveys, DHS, LSMS
  • World health survey - 91 plus countries, rolling out to 191 over 3 years
  • CHOICE
    • WHO initiative to provide evidence on the effectiveness and costs of major health interventions for 17 sub-regions of the world
    • Cost-effectiveness information can be used to identify the allocatively efficient set of interventions
overall hspa objectives
OverallHSPA objectives

1) Monitor and evaluate attainment of critical outcomes and the efficiency of the health system in a way that allows comparison overtime and across systems

2) Build an evidence-base on the relationship between the design of the health system and performance

3) Empower the public with information relevant to their well-being

slide6

Health

Responsiveness

Financial Contribution

Health system goals

Level

Distribution

Efficiency

Quality

Equity

who world health survey core modules
WHO world health survey CORE modules
  • Based on scientific review of existing instruments
  • Developed through:
    • Cognitive interviews & cultural applicability tests
    • Reliability - stability of application
    • Cross-population comparability

Modules

  • Health ( description & valuation)
  • Health system responsiveness
  • Health financing and expenditure
  • Adult mortality
  • Risk factors and chronic diseases
  • Assets
  • Modules (continued)
    • Coverage key interventions
    • Provider survey (under development)

Flexible shell: additional modules could be added by countries as needed

coverage interventions
Coverage interventions
  • Maternal care - antenatal care, attended delivery
  • Child health - immunization
  • Prevention of STI and HIV/AIDS
  • Malaria and TB
  • HIV/AIDS - mother-to child transmission, ARV treatment, chronic care
  • Chronic conditions - angina, epilepsy, asthma, depression, diabetes, arthritis
  • Cancer screening, vision and hearing, road traffic injuries
  • Water and sanitation
definition of effective coverage
Definition of effective coverage

The probability of receiving a necessary health intervention conditional on the presence of a health care need

provider characteristics and provider surveys
Provider characteristics and provider surveys
  • Indicators of this instrumental goal (linked to intrinsic goals)
  • National health accounts - basic and detailed matrices (type of care, type of provider, service)
  • Facility surveys - including aspects of responsiveness, fairness in financing, human resources, provider performance assessment, burden of disease
service provision needs to be more efficient
Service provision needs to be more efficient
  • Through better information & accountability
  • Through direct incentives
why don t the poor have access to health services
The public sector fails:

Lack of resources?

Low efficiency?

Political biased allocation of resources?

The private sector fails:

Unequal income distribution and lack of “effective demand”

Imperfect markets

Why don’t the poor have access to health services?
inefficient resource allocation ratio of nurses to doctors in l a and caribbean

5

Barbados

Trinidad & Tobago

4

Surinam

Panama

3

Enfermeros por 1.000 inhabitantes

Jamaica

Costa Rica

2

Guyana

Guatemala

Paraguay

El Salvador

Peru

1

Venezuela

Dominican Republic

Argentina

Uruguay

Colombia

Mexico

Chile

Bolivia

Honduras

Ecuador

Nicaragua

Brazil

Haiti

0

0

1

2

3

Médicos por 1.000 inhabitantes

Inefficient resource allocation: Ratio of nurses to doctors in L.A. and Caribbean

3 nurses per doctor in

N. America

Source: PAHO, 1998

slide17

150

MWI

MOZ

AGO

GIN

MLI

NER

TCD

ETH

ZMB

IRQ

KHM

LAO

YEM

BFA

BDI

UGA

BEN

PAK

MDG

NPL

TZA

CIV

MMR

NGA

BGD

SDN

75

GHA

HTI

BOL

IND

SEN

KEN

PRK

CMR

EGY

ZWE

MAR

IDN

ZAF

HND

TUR

PER

GTM

DOM

VNM

IRN

PHL

BRA

ECU

SLV

THA

CHN

DZA

MEX

SYR

TUN

TJK

KAZ

UZB

Infant Mortality (per 1,000 births)

COL

LBY

PRY

AZE

VEN

ARG

ROM

SAU

RUS

LKA

BGR

15

UKR

POL

BLR

GEO

MYS

CHL

SVK

HUN

KOR

CUB

GRC

CZE

USA

PRT

ISR

ITA

CAN

GBR

BEL

AUS

ESP

NLD

AUT

DNK

DEU

CHE

FRA

JPN

FIN

SWE

20.00

200.00

2000.00

Public Health Expenditure ($PPP/person)

Infant mortality varies across countries

that spend similar amounts on health

Note: For countries with population > 5 million

Source: WHO

out of pocket share declines with income
Out-of-pocket share declines with income

100

80

60

Out-of-pocket share of health spending (%)

40

20

Regression Line

0

10000

20000

30000

40000

GDP Per Capita (ppp$)

slide19

1

1

.8

.8

.6

.6

.4

.4

.2

.2

0

0

1

2

3

4

5

6

7

8

9

10

10

1

2

3

4

5

6

7

8

9

1

.8

.6

.4

.2

0

1

2

3

4

5

6

7

8

9

10

Burundi

Latvia

HFC

HFC

Expenditure decile

HFC

Romania

why is efficiency of health services important
Why is efficiency of health services important?
  • Reduces the amount of public services that can be provided
  • Reduces the quality of public services
  • Leads to inequities in service provision
  • Lowers productivity
  • Reduces international competitiveness
sources of inefficiency the agency problem
Principal and agent:

Different objectives

Different information

Cost of restructuring is high

Efficient contracts are hard to find

Sources of inefficiency: the agency problem
approaches to the agency problem
Non-pecuniary motivation

Pay for output

Pay by effort

Fixed payments and agent assumes risk

Is it enough?

Can you precisely define outputs?

Is effort measurable?

Can you accept bankruptcies and overpayments?

Approaches to the agency problem
what has been tried
Models

Command & control

Performance contracts

Internal markets

Contests

Competition

Examples

Military

Corporatized hospital

Health districts

Water concessions

Primary schools

What has been tried?
typically in the private sector
Non-pecuniary motivation

Pay for output

Pay by “effort”

Fixed payments and agent assumes risk

“Team players” & awards

Only for piecework

Salaried workers

Contractors

Typically in the private sector . . .
typically in the public sector
Typically in the public sector . . .
  • Motivation and vocation may be difficult to achieve at a large scale
  • Limited managerial discretion over workforce
  • Measurement of outputs is difficult
health systems have the problems of markets
Down side:

Moral hazards

Administrative and marketing costs

Difficulty mobilizing public resources

Variable quality

Potentially:

Incentives for good performance

Attention to consumer

Incentive to collect

Accommodation of differences among population groups

Health systems have the problems of markets . . .
and problems of bureaucracies
Down side:

Inefficient allocations that raise costs

Lack of transparency

Restricted managerial discretion

Unresponsive to clients

Potentially:

National planning

Easier to be redistributive

Potentially lower administrative costs

“Fair”

. . . and problems of bureaucracies
improving health services for the poor through incentives
Improving health services for the poor through incentives
  • Purchasing insurance coverage: Colombia
  • Rewarding performance: Haiti
  • Incentives for staff: Kenya
coverage expanded especially among the poor in colombia
Coverage expanded especially among the poorin Colombia

Subsidized

Contributors

Fuente: Sanchez, 2000

slide30

90

Target

Result

80

70

Baseline

60

50

40

30

20

10

0

Immunization

4+ FP available

3+ prenatal

FP discontin.

ORT

Correct ORT

Results of active purchasing: NGO in Haiti

Source: R. Eichler, “Strategic Purchasing in Haiti to Improve Health”, EUROLAC Case Study, World Bank, 2002.

improved financial performance in kenya
Improved financial performance in Kenya

Six-month total gain or loss

Source: Rena Eichler. Performance-based reimbursement of rural primary care providers: evidence from Kenya

conclusion
Conclusion
  • When health services are inefficient the poor suffer disproportionately
  • Incentives (external and internal) have been shown to work
  • WHO programs will provided information need by decision makers