Universal coverage in health care financing

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					 Universal coverage in health care financing:
 is community-based insurance the answer?
   Prof. R. Sauerborn, Heidelberg University, Germany
        The challenge:
        Universal access to good quality health care

        The reality:
Latin America             China             Burkina Faso
25 % without hlth   85% of rural          99.1% without
insurance           49% of urban popul.   insurance
                    without hlh           85% of rural popul.
                    insurance             without access
  Main groups not covered by
          insurance
   Group    Latin    China   Sub Saharan
           America              Africa
Farmers      +        ++        +++
Informal    +++      +++         +
urban

Migrant      +        ++         ++
workers
      Share of informal sector in non-
  agricultural employment, Latin America
    Peru


 Ecuador
                                                   1994
                                                   1990
Colombia


    Chile


   Brazil


  Bolivia


Argentina
                                         Source : ILO 1996


            0   10   20   30   40   50     60                70 %
      Per capita health expenditure
   by source - rural Burkina Faso 1996
    Bagala                                                                       0,45
    Werebe                                                 0,33
Konankoira                                          0,62
  Bourasso                                        0,41
    Dembo
                                                                                Government
                                                   0,35
Bomborokuy                                               1,20
      Toni                                           0,7                        Donors
    Barani                                           0
                                    0,30
 Doumbala                           0,31                                        Users
    Berma                                  0,38
   Kinekuy                                               0,29
      Koro                   0,55
     Dokuy                     0,62

             0   200   400   600       800          1000          1200   1400    1600

                                    F CFA
Overview of financing mechanism
   fee for service - most developing countries
   taxes - UK
   saving funds - Singapore
   private insurance - US
   HMO - US
   social insurance - German and Latin
    American model
   community-based insurance - experiments
    from Africa, Latin America, Asia
          Target groups forsocial and voluntary
               insurance -Vietnam, 1999
                               Total population
                                     78 m



 Civil servants,      Informal sector                     Dependents
 fomal sector          self-employed                       in need of
 incl. retirees         rural workers                      coverage
      8m                     38 m                            32 m

Social insurance   Voluntary       User fees      Government      Donor aid
     8m            insurance                        subsidies      ca 2 m
                      4m             34 m            ca 30 m

    10 %            5%             44 %                    41 %
                                            Jowett and Thompson, 1999
             Population and Social Benefits,
Minimum salaries
                by Income, Brazil, 1986
 per hh member
   >20                                                 Social security
                                                       Other public programs
  11-20                                                Population

   6-10

   3-5

   1-2

 0.5-0.99

0.25-0.49

  <0.25                                                 Source: World Bank, 1988



            -25    -20   -15   -10   -5   0   5   10       15         20           25   %
Price-elasticity of demand for outpatient care
                     overall  = - 0.79

                               Arc price-elasticity
         Sub-group                           
                                 of demand ( )
         By age group
         <1y                           -3,64
         1 - 14 y                      -1,73
         >=15y                         -0,27
         By revenue quartile
         1 (poorest)                   -1,44
         2                             -1,21
         3                             -1,39
         4 (richest)                   -0,12
                      Source: Sauerborn et al., 1994
                    Predicted change in demand for public health services
                         after introduction of user fees, urban Bolivia


predicted change
  of demand                                                                    model:
      [%]                                                                 multinomial logit
  - 30
                                                                               n = 29 996

  - 25

  -       20

   - 15
                                                                    Hospital, children
      - 10
                                                                Hospital, adults
      -    5
                                                           Clinic, children
            0
                1                                      Clinic, adults
      (poor)          2        3
                                       4
                                            (rich) 5          Source: Sauerborn et al., 1995
                          income quintile
                                       Spreading financial risks protects the
                                          livelihood of poor households
                                           Cumulative percentage of illnesses, by size of illness cluster
                                120%


                                100%
cumulative % of all illnesses




                                80%


                                60%


                                40%


                                20%


                                 0%
                                       0       1    2     3      4      5       6      7      8      9     10   11   12
                                                    Size of illness cluster (# of illness episodes/household)
    Illness clustering calls for risk sharing
                      Case study: Household 028A_S

                                                             oo
                                                    Hernia
                                                                                AIDS


          oo                                  oo                                oo
Night blindness.                 Night blindness.            Schisto.




                   Measles '86     Schisto.              Measles '86    Whooping     Measles '86
                                                                        cough '91
          Definition:
Community-based health insurance:
  Applying the principles of insurance
  to the social context of communities,
  guided by their preferences and
  based on their structures and arrangements.
Approach to create CBI (I)
   Identify the excluded
Example: The main groups not covered
by insurance in Chinese Cities:
     primary dependents of people covered
      under the government health insurance
      (gongfei)     and workers’ insurance
      (laobao)
     people employed by private companies
      and joint ventures
     self-employed (getihu)
     rural to urban migrants
Approach to create CBI (II)
   Identify the excluded
   Understand the informal sector
    organizations and the existing risk-
    sharing arrangements
         Types of community risk sharing
                   organizations
                  - Nouna district, rural Burkina Faso-
     name                   function             # organizations # participating
                                                                     individuals
Tontines         Traditional saving groups       150 in district       2,388
                 (rotative savings)               (Nouna has 17)
Pre-cooperatives Saving, food aide, social             43              2,000
                 activities, transport, rotative
Cooperatives farming and harvesting,                    1                47
                 house and well construction
Associations tree planting, road construction,         13              2,800
                 crafts, environmental hygiene,
                  health (1)
                                                      207              7,235
                                                                   (= 12.1% of
                                                                    population)
   Source: Sauerborn et al., 1998
Approach to create CBI (III)
   Identify the excluded
   Understand the informal sector
    organizations and the existing risk-
    sharing arrangements
   Study community preferences for
    benefit package content
   Assess willingness-to-pay for such
    packages
      Comparative research:
Willingness-to-pay for community-
      based health insurance
Country           Target group
Burkina Faso      Farmers, informal
                  urban sector workers
Mexico, Bolivia   Informal urban
Wuhan             Informal urban,
                  migrant workers
Vietnam           Farmers, informal
                  urban sector workers
          Relationship between P(I=1) and price
                          Hypothetical data
                1.0
                0.9


                                                         1W 1  p
                0.8
                                                               TP
                0.7
                                                    Ii  
                                                         0  otherwise
P(I=1)




                0.6
                0.5
                0.4
                0.3
                0.2
                0.1
                 0
     -2    -1         0         1   -a0/b   2        3         4          5

                          price (arbitrary units)
Approach to create CBI (IV)
   Assess population-based health care
    needs
   Establish unit costs of service provision
   Calculate premium
                                                          Germany 1883-2000:
                                              gradual increase in social insurance coverage
                                                                                Year
                                          1885 1895 1910 1914 1925 1934 1950 1955 1960 1965 1968 1976 1980 1985 1990 1995
                                    100
                                                 Private health insurance
Coverage in % of total population




                                    90           Statutory health insurance

                                    80


                                    70


                                    60


                                    50


                                    40


                                    30


                                    20


                                    10
                                     Germany 1883-2000: consolidation of sickness funds
                                     25000                                                                120000
                                                                               number of statutory sickness funds
                                                                               average number of insured per fund
                                                                                                          100000
Number of statutory sickness funds




                                     20000




                                                                                                                   Average number of insured per fund
                                                                                                          80000

                                     15000

                                                                                                          60000


                                     10000
                                                                                                          40000



                                     5000
                                                                                                          20000




                                        0                                                                 0
                                            1885 1895 1905 1915 1925 1935 1945 1955 1965 1975 1985 1995
                                                                        Year
Germany 1883-2000: gradual inclusion of target groups
     Year                 Occupational group, societal group covered

     1883      Blue collar workers
               Craftsmen
               Employees of lawyers, industrial cooperatives, insurance funds
     1885      Transport workers
     1892      Commercial office workers
     1911      Agricultural and forestry workers
               Domestic servants
               Itinerant workers
     1914      Civil servants
     1918      The unemployed
     1919      Persons employed in public or private cooperatives
               Wives and daugthers of insured
     1927      Sailors
               Persons employed in the educational and social welfare sectors
     1930      All primary dependents
     1938      Midwives
               Self-employed workers in nursing and child care
     1941      Retirees
     1953      Refugees and expellees
               The seriously disabled
     1957      The physically disabled
     1972      Farmers
     1975      Students
               All disabled
     1981      Artists, journalist
 From community-based health
insurance to universal coverage
 Mechanisms:
  public regulation

  amalgamation

  re-insurance

  risk equalisation scheme
Closing the circle
   Global health problems- global
    solutions
   Example: Health sector crisis -
    financing of high quality care
    through insurance
   Evidence from different places and
    times may be instructive
       Health care crisis



Isolation             Cooperation

				
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