Briefing Slides Deputy Minister

							             First Balkan Forum on:
               Health Care Reform
              ALBANIA: AN OVERVIEW of
               THE HEALTH SYSTEM &
             HEALTH INSURANCE SCHEME

                       Ms. Elvana Hana
      General Director Albanian Health Insurance Institute

                        November 2007

  CIDC                                                       1
Consulting
  Albania has an evolving health care
  system
 • Health services in Albania are delivered by a mix
   of public and private providers
       – Hospital services are primarily provided by the MOH and other
         public bodies
       – PHC is provided through a network of GP’s with increasing levels
         of private ownership planned for this sector
       – Pharmacies, dentists and other auxiliary health services have
         been fully privatized for some time
 • The Ministry of Health remains the key policy
   maker and regulator of the health sector
 • Municipal Governments also retain some
   involvement in the health sector at regional level
  CIDC                                                                   2
Consulting
  Albania’s health delivery and financing
  structure                MOF Budget
                                           for Health
  Taxation Authority


    Insurance           Health Insurance
                                                         MOH
   Contributions         Fund/ Institute                 Budget



                                                              Municipal Councils




Patient Out-Of-Pocket
                             PHC Centres, GPs           Hospitals
 Payments (co-pay)

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Consulting
  Health financing has been a focus of the
  health sector reform in Albania
 • Albania supports a national health insurance
   scheme that is managed by the Health Insurance
   Institute (HII)
       – The HII was established in 1995 and initially focused on
         reimbursing pharmacies for essential medicines, contracting
         individual GPs & Family Doctors for PHC services
       – Two pilot projects were undertaken involving the HII contracting
         one Regional Hospital & a Regional Health Authority
 • The HII was established with the intention that it
   would become the single purchaser of health
   services for the public sector
       – The HII is still evolving into this single purchaser role
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Consulting
  Financing of health care is fragmented
    • Government expenditure as a % of total health spend remains low
      (38.7%), while private (out-of-pocket) spend is high (~60%)
    • Public funding for health is financed through general taxation,
      payroll tax (insurance contributions) & some donor funds
    • Resource Allocations by Medium-Term Budget Program 2007-09

 Year                                2007     2007     2008     2008        2009     2009
                                    (m lek)   (%)     (m lek)   (%)        (m lek)   (%)

 Total Budget for Public Funding     30,318    100     34,527     100       38,975       100
 (million Lek) :
   - State Budget                    23,885     79     27,560      80       31,858       82
   - Extra-Budgetary Funds            4,913     16      5,257      15        5,888       15
   - Donor Funds                      1,520      5      1,710       5        1,229        3

 1. Administration (including all     2,432      8      2,762          8     2,338        6
 donor funds)
 2. Public Health Services              760     2.5     1,036       3        1,170        3
 3. Primary Health Care              12,102      40    13,810      40       16,370       42
 4. Hospitals                        15,024    49.5    16,919      49       19,097       49
  CIDC                                                                               5
Consulting
  Recent health financing reforms have
  focused on PHC

 • Late last year the HII became responsible for
   contracting & paying for all public PHC services
       – HII is now the single purchaser for all publicly financed PHC in
         Albania
       – HII has contracts with all state PHC providers and is developing a
         performance based payment mechanism for PHC
       – PHC providers have been allowed corresponding levels of
         autonomy and ownership rights
       – Municipalities also retain an important role in PHC, participating
         through Regional Boards



  CIDC                                                                      6
Consulting
  Reform was also undertaken in the
  pharmaceutical sector

 • HII is responsible for reimbursement of
   pharmacies for essential drugs for some
   categories of patients
       – (pensioners, students, disabled patients etc.)

 • In 2006 the HII faced serious financial
   constraints due to unexpected growth in drug
   reimbursement costs
       – The categories of patients eligible for free drugs was expanded
         without corresponding budget allocations
       – The number and type of drugs added to the essential drugs list
         was expanded on without matching budget allocations
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Consulting
  Policy changes were introduced in
  response to the financial issues, although
  further reform is needed
 • HII introduced a small tariff per prescription to
   immediately combat over-use of the scheme
 • Some expensive & inappropriate drugs were
   removed from the essential drug list
 HOWEVER
 • HII still cannot manage which drugs it reimburses
   and at which cost these are to be reimbursed
 • Matching a predefined & affordable benefit
   package (be it for PHC/ drugs) against HII’s
   finances also remains an issue                      8
  CIDC
Consulting
  Further reform of Albania’s health
  financing systems are planned
 • It is intended that HII will become responsible for
   pooling most health funds in Albania;
 HOWEVER
 • Private out-of-pocket payments constitute a
   significant amount of Albania’s health
   expenditure
       – difficult to formalize or incorporate into the health insurance fund
       – Lack of predictability & a large untapped fund source

 • Some public funds for health remain with other
   line ministries
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Consulting
  Further reform of Albania’s health
  financing systems are planned
 • It is intended that the HII will become the single
   purchaser for all public health services in Albania
       – PHC providers will be contracted using a performance based
         payment mechanism
       – Hospitals will be contracted using output based formula
 HOWEVER
 • Hospitals Directors & PHC providers will need
   autonomy & the skills to manage under such a
   scheme
 • Regulatory responsibilities (MOH and HII)
   require further definition
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Consulting
  The regulation & effective use of the
  private sector remains a concern
 • The current legal & regulatory framework is
   inadequate to deal with the growing &
   increasingly sophisticated private sector
       – Licensing of all private providers, setting & enforcing standards,
         ensuring quality of care & patient safety are pressing
         requirements
       – The MOH has developed some standards, norms, accreditation &
         quality indicators but mechanisms to measure and enforce these
         in the immediate term remain weak
       – Professional Orders are established but have not shown to be
         strong in disciplining or ensuring professional standards or
         conduct


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Consulting