Health financing in developing countries - HS229f
DRAFT SYLLABUS (Revised Sept. 11, 2006)
Modular course, Fall 2006 (block I, first half of semester)
Prof. Donald S. Shepard
Heller School (office at 60 Turner St., Second Floor)
E-mail: , Tel: 781-736-3975
Web: http://www.sihp.brandeis.edu/shepard
Executive assistant: Clare Hurley,
Teaching assistant: Wu Zeng,
Overall Objective: This module examines the mobilization of resources for the health system as a whole, and the funding of individual providers for health services in developing countries. Adequate levels of financing, equitable means of raising this funding, and appropriate ways of using this financing to pay health providers, are all key to an effective and efficient health care system. Many countries are undergoing processes of health reform, in which fundamental changes in the funding and organization of the health system are being examined. This module will provide the tools for examining both broad reforms, as well are refinements of individual components of the health care system. This course is required for students in the Master of Science in International Health Policy and Management, but may be taken by interested students in other programs as well.
Approach: The module uses interactive discussions and computer exercises where students will learn to develop and assess the performance of alternative health financing instruments. Real world, relevant examples of health financing systems, drawn from a number of developing countries and supplemented by examples from industrialized countries, will be used to reinforce the lectures. To reinforce the techniques, students will be asked to solve a written, pass-fail computer exercise using Excel approximately every other class. Exercises will be discussed in optional lab sections followed by class discussion. The course begins with an overview; successive sessions discuss alternative approaches to health financing. The module concludes with a synthesis and policy analyses.
Evaluation: Students will be evaluated based on (1) a brief (8-page) written paper, (2) homework exercises, and (3) one in-class quiz. The written paper will require students to apply principles of health financing to a problem or question of the student’s choice, such as analyzing the impact of an existing or proposed program or reform in health financing in a country of the student’s choice. The analysis should be based on real data where available, but may use assumptions, based insofar as possible, on experience or plausible judgments, where actual data are not available. Students may either work individually or in pairs. The homework exercises will largely involve solving and interpreting quantitative problems using Excel, such as analyzing the impact of a change in user fees on revenue and utilization of services by different income groups. The quiz will test key concepts covered to date. As a piece of individual work, the quiz will ensure that each student learn the material personally.
Time and Place: Fridays 9:10 am to 12 noon at Heller 113, 1st floor, beginning Sept.1, 2006. Times may shift during selected weeks.
Disability: If you are a student with a documented disability on record at Brandeis University and wish to have a reasonable accommodation made for you in this class, please see the instructor immediately.
Session 1, Sept. 1, 2006 – Overview and general revenues as a source of funding
Objectives: The first session will start with an overview of health financing (particularly the mix between the public and private sectors), with descriptive data drawn from national health accounts. It will then examine the need for financing, the link between investment in creating infrastructure (such as hospitals) and the funding needed to meet the recurrent costs of those institutions. Next, it will consider criteria for evaluating funding – ability to raise sufficient resources, fairness, administrative ease, and impact on health care costs. It will then consider the first source of financing, general revenues of the central government. This source is consistent with the premise that health care is the responsibility of the central government.
Readings:
Heller, Peter (March 1979). The Underfinancing of Recurrent Development Costs. Finance & Development, pp. 38-41.
Shepard, Donald S.; Gonzales, Maribel (1981). A Procedure for Projecting Hospital Recurrent Costs. Teaching Note. Boston: Harvard School of Public Health.
WHO (2000). Who Pays for Health Systems? In: The World Health Report. Health Systems: Improving Performance. Geneva: WHO, pp 93-116.
WHO (2005). Selected national health account indicators for all member states. In: World Health Report 2005, Appendices 5 and 6. Geneva: WHO, 2005, pp 192-203. www.who.int/whr/2005/annexes-en.pdf
Session 2, Sept. 8, 2006* –Voluntary health insurance: Community and private
*Note: This class may need to be rescheduled.
Objectives: The third session will explore voluntary health insurance: community and private. Voluntary systems are generally politically preferable, as they do not require that people pay for a service they may not value or afford.
Readings:
Framework and African experience
Preker, Alexander S.; Carrin, Guy; Dror, David; Jakab, Melitta; Hsiao, William, Arhin-Tenkorang, Dyna (2002). Effectiveness of community health financing in meeting the cost of illness. Bulletin of the World Health Organization 80(2)143-150.
Shepard, D.S., Vian, T., Kleinau, E.F (1995). Performance of four health insurance programs in rural and urban areas of Zaire. In: Financing Health Services through User Fees and Insurance: Case Studies from Sub-Saharan Africa, Shaw, R. P., and Ainsworth, M., eds. Africa Technical Department Discussion Paper No. 294. Washington, D.C.: The World Bank, pp. 169-206.
Carrin, Guy (2003). Community based Health Insurance Schemes in Developing Countries: facts, problems and perspectives (Discussion paper number 1, Publication number EIP/FER/DP.E.03.1). Geneva: WHO.
Schneider, Pia and Francois Diop (2004). Community-Based Health Insurance in Rwanda. In: Health Financing for Poor People, Alexander S. Preker and Guy Carrin, eds. Washington, DC: The World Bank, pp. 251-274.
Diop, François Pathé; Butera, Jean Damascene (2005). Community-Based Health Insurance in Rwanda. Development Outreach, May 2005. Washington, DC: The World Bank Institute. (http://www1.worldbank.org/devoutreach/may05/article.asp?id=299)
Asian experience
Hsiao, W. C (2004). Experience of community health financing in the Asian region (2004). In: Health Financing for Poor People, Alexander S. Preker and Guy Carrin, eds. Washington, DC: The World Bank, pp. 119-155.
Supakankunti, Sirpen (2004). Impact of the Thai Health Card. In: Health Financing for Poor People, Alexander S. Preker and Guy Carrin, eds. Washington, DC: The World Bank, pp. 315-357.
Session 3, Sept. 15, 2005* – Mandatory social insurance
*Note: This class may be rescheduled
Objectives: The second session will address the source of funding that has been widely used in Western Europe -- mandatory social insurance. First, this topic will address the performance of mandatory social insurance in countries in which it is well established, such as Germany. Then it will consider some of the constraints in developing countries, such as a smaller share and of national income in the formal economy, and differences in costs and expectations between urban and rural populations. If almost everybody earned a wage as an employee
Readings:
Cheng, Tsung-Mei (2003). Taiwan's New National Health Insurance Program: Genesis And Experience So Far. Health Affairs, vol. 22, no.3, pp. 61-76
Lu, Jui-Fen Rachel and Hsiao, William C (2003). Does Universal Health Insurance Make Health Care Unaffordable? Lessons From Taiwan. Health Affairs, vol. 22, no.3, pp. 77-88
Session 4, Sept. 22, 2006 – User fees and medical savings accounts
Objectives: This lecture addresses payment by clients or their families for services. These payments may be required at the time and point of service (e.g., user fees) or in advance (medical savings accounts). For curative services, user fees capitalize on the importance that consumers place on feeling well. It also provides funds that are available in a timely and reliable way at the health delivery facility. Medical savings accounts are one of the newest approaches to health financing. Singapore is the country that has made the most extensive use of the approach, where it pays for about a third of national health spending, and over half of secondary hospital funding. The hypothesized advantage is that if clients are using their own money, they will help control the cost of care. Demand studies – the impact of fees and accounts on utilization – will be considered as important policy outcomes.
Readings:
Shepard, D.S., Carrin, C., and Nyandagazi, P (1993). Household participation in financing of health care at government health centers in Rwanda. In: Health Economics Research in Developing Countries, Mills, A. and Lee, K., eds. New York: Oxford University Press, pp. 140-164. [Also in: Health Economics for Developing Countries, Mills, Anne, and Gilson, Lucy, eds.. London: London School of Hygiene and Tropical Medicine, 1992.]
Taylor, Rob; Blair, Simon (2003). Financing Health Care: Singapore's Innovative Approach. Public Policy for the Private Sector, Note 261. Washington, DC: World Bank. Web:
http://rru.worldbank.org/Documents/PublicPolicyJournal/261Taylo-050803.pdf
Shepard, D. S (2002). Analysis of the Singapore Medical Savings Scheme based on the visit of the Samoan delegation in February 2002. Waltham, MA: Schneider Institute for Health Policy, Brandeis University.
Session 5, Sept. 29, 2005 -- Provider payment mechanisms
Objectives: This lecture examines the operational level of health financing, the payment of health providers (hospitals, physicians, pharmacists, etc.). After a health financing system has mobilized resources, it must compensate health providers, such as hospitals and physicians. The method of contacting them affects the efficiency and equity in the health system. The session will examine several systems: fee for service, capitation, and the effects of supply side restrictions through managed care, such as prior authorization, or continuing stay reviews.
Readings:
Ron, Aviva, Abel-Smith, Brian, Tamburi, Giovanni (1990). Paying Doctors and Hospitals under Health Insurance. In: Health Insurance in Developing Countries: The Social Security Approach. Geneva: International Labour Office, pp. 53-70.
Edmond, Alan H. et al. Establishing a Family Health Fund in Alexandria, Egypt: The Quality Contracting Component of the Family Health Care Pilot Project. Partnerships for Health Reform Technical Report No. 42. Bethesda, MD: Abt Associates, 1999.
Session 6, Oct. 6, 2006 – Managed care and other models from the US
Objectives. Managed care, a set of tools for the payer to control the provider, amount, type, and price of care, is one of the most controversial aspects of the US health system. Its prominence in the 1990s stemmed the rapid growth in health care spending, which had exceeded 10 per cent per year for most of the previous two decades and led the United States to spend one seventh of its GNP on health, a higher share than any country in the world. On the other hand, its perceived restrictions on patient and provider choice have made it unpopular to both parties. This session reviews some experience from the United States and discusses possible implications for developing countries.
Readings:
Newbrander, W., Eichler, R. (2001). Managed Care in the United States: Its History, Forms and Future. In: Recent Health Policy Innovations in Social Security, Ron, A., Scheil-Adlung, X., eds. New Brunswick: Transaction Publishers, pp. 83-106.
Shepard, D.S., Daley, M., Ritter, G.A., Hodgkin, D. (2001). Effects of a statewide carve-out on spending and access to substance abuse treatment in Massachusetts, 1992 to 1996. Health Services Research 36(6), Part II: 32-44.
Session 7, Oct. 13, 2006 -- Donor support, employers and conclusions
Objectives. In the lowest income countries, donors can play a key role in the health sector. While economic theory suggests that the public sector should support public goods, such as many preventive services, political forces often direct public funds to tertiary hospital services sought by vocal constituents and patients in major cities. Donors sometimes fill this gap, funding the most critical services. Financing the cost of AIDS care is included as an example, using the Abt Associates software ‘Treat cost.’
Readings
Preker, Alexander S., Langenbrunner, John C. and Suzuki, Emi (2004). Deficit Financing of Health Care for the Poor. In: Health Financing for Poor People, Alexander S. Preker and Guy Carrin, eds. Washington, DC: The World Bank, pp. 361-396
Shepard, Donald S. (1998). Levels and Determinants of Expenditures on HIV/AIDS in five developing countries: overview. In: Confronting AIDS: Evidence from the Developing World, Ainsworth M, Fransen L, Over M, eds. Brussels: European Commission, Chapter 12A, pp. 241-253.
Musgrove, Philip (1996). Public and private roles in health. Theory and financing patterns. Health and Nutrition Program Working Paper. Washington, DC: The World Bank. Web: http://www1.worldbank.org/hnp/Pubs_Discussion/Musgrove%20public-private-whole.pdf
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