HEALTH FINANCING - COHRED

HEALTH FINANCING

Learning from Experience: Health care nancing in lowand middle-income countries

Diane McIntyre

Learning from Experience: Health care financing in low- and middle-income countries

? Global Forum for Health Research 2007 Published by the Global Forum for Health Research, June 2007

ISBN 2-940286-53-1

Suggested citation: Diane McIntyre, Learning from experience: health care financing in low- and middle-income countries, Global Forum for Health Research, Geneva, 2007

Keywords: 1. Health care financing. 2. Health financing systems. 3. Low- and middle-income countries. 4. Developing countries. 5. Health insurance. 6. Equity.

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Learning from Experience:

Health care financing in lowand middle-income countries

By Diane McIntyre

Health Economics Unit, University of Cape Town, South Africa

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Acknowledgements

This report was written by Diane McIntyre, University of Cape Town, South Africa, and the work carried out under the general direction of Sylvie Olifson-Houriet of the Global Forum for Health Research in Geneva, Switzerland.

We would like to acknowledge the helpful comments and contributions of the peer reviewers - Eleonora Cavagnero, Tim Ensor, Adam Leive and George Schieber. We also extend our thanks to Guy Carrin, Andr?s de Francisco and Stephen Matlin, who provided constructive comments, and to Abdul Ghaffar, Lakshmi Sundaram and other colleagues who contributed to the conceptualization of the project. Any errors or omissions, however, are the sole responsibility of the author. Thanks are also due to John Maurice for editing this report.

We believe that the subject is important and deserves more attention than it has received to date ? attention that ideally should be followed by concerted action. We hope that others, particularly national-level policy-makers striving to improve the equity, efficiency and sustainability of health care financing in their country, will find the report of value.

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Foreword

Despite impressive progress since 1950, huge challenges remain in the effort to improve health outcomes in developing countries and achieve related goals concerning universal coverage, basic needs, equity, inclusion, risk protection and reaching poor and marginalized groups. One of these challenges is how health should be financed ? who should pay how much and through what arrangements, given the reality that the services and other actions needed to attain desired health results inevitably involve costs that must be financed somehow.

This is no simple matter. Developing countries' public, private and civil society sectors, together with external donors and other partners, act as financiers and/or providers of health services. Funds are mobilized through taxes, social security/insurance systems, fees, grants, loans and other revenue-generating instruments, and flow through budgets and various off-budget channels. The public and private choices that are made in this complex space have profound implications not just for which groups bear what share of the costs, but also for who actually gets services and in what quantity and quality.

Diane McIntyre captures here the state of thinking and evidence on health care financing choices and their impact in developing countries, and points out that a hardwon consensus has been achieved in the field. There is now little doubt that prevailing systems that rely heavily on out-of-pocket fees ? with all their adverse effects, including their impoverishing effect on vulnerable households ? are too dominant now and need to give way to more modern solutions drawing on prepayment and integrated risk pools.

Her analysis provides sufficient details to demonstrate clearly the complex issues under discussion. Useful country examples are employed to illustrate points made in the text, a summary policy recommendation table is provided in the conclusions, and policy guidance is practical and specific.

The hard-won technical consensus now needs to be communicated clearly and effectively. At the Health Financing Task Force (), we are committed to doing just that, promoting the application of evidence-based health financing policies in developing countries. Dr McIntyre's work provides an excellent example of what can and should be done to move things forward.

David de Ferranti Chair, Health Financing Task Force

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