DRAFT GUIDELINES FOR THE

SHA 2011 FRAMEWORK FOR

ACCOUNTING HEALTH CARE

FINANCING

14th Meeting of Health Accounts Experts, OECD

Paris 10-11 October 2012

David Morgan , Health Division, OECD

Eva Orosz, Head of Health Policy and Health Economics

Department, ELTE University,

Faculty of Social Sciences, Budapest

• Purposes of the Financing Guidelines

• Preparation of the Guidelines: a collaborative effort

• The structure and some key issues

• Further steps

• Issues for discussion

Overview

• a more detailed explanation of the changes in concepts related to health care financing in SHA 2011;

• general approaches for the preparation of SHA data relevant to health care financing; and

• possible methodologies and approaches useful in the case of complex financing arrangements.

Aim of Financing Guidelines

• The first draft presented in 2011 has undergone substantial review and revision:

– 2011 OECD Meeting of Health Accounts Experts;

– a peer review group, WHO NHA Team;

– Selective in-house testing of feasibility of elements of the guidelines

– Workshop (9th October)

A collaborative effort

• Financing Guidelines complement the relevant chapters of the SHA 2011 Manual.

• On the other hand, the guidelines are a stand-alone document.

• Not all parts of the Guidelines are relevant or

appropriate to countries:

– differences in the complexity of health financing systems,

– health policy issues of interest,

– data availability and available resources.

How to use the SHA Financing Guidelines

1. The accounting of health care financing under SHA 2011

2. Description of the health care financing system from a health accounting point of view

3. Mapping from SHA 1.0 to SHA 2011

4. Accounting the government’s involvement in health care financing

5. Interpretation of “public” and “private” under SHA 2011

6. Accounting foreign aid

7. Further analysis of health care financing from the perspective of types of schemes and institutional units

Structure of the Financing Guidelines

• From a health policy perspective

• Information on health financing functions and performance of the financing system – Role of the government

– Role of foreign aid

• Information on changes in institutional arrangements of health care finance

• Interpretation of “public” and “private”

1. Key concepts and definitions

From a health accounting perspective

• Identification and relationships between

– providers of financial resources

– financing schemes

– financing agents

• Accounting of the basic flows: (i) revenue-raising by the financing schemes; and (ii) allocation of resources

• Transition from SHA 1.0 to SHA 2011

• Accounting health financing from the perspective of the individual schemes and institutional units

The financing framework under SHA 2011

Financing

agent

(FA)

Financing

agent

(FA)

Institutional units of

the economy

providing revenues

Financing

agent

(FA)

Providers

(HP)

Functions

(HC)

Financing

scheme

(HF)

Financing

scheme

(HF)

Basic structural relationships

of health financing

Money flow

2. Describing health financing systems

• Task 1: Identifying the national health care financing arrangements

– preparing an inventory of financing arrangements

– Classifying according to ICHA-HF in SHA 2011

• Task 2: Describing the structure of the health financing system

– identification of related financing agents for each financing scheme

• Task 3: Identifying the basic flows in health financing

– (i) revenue-raising by the financing schemes; and

– (ii) allocation of resources by the financing schemes (according to functions, providers and beneficiaries)

2. Relationship between Financing schemes (HF) and Financing agents (FA)

Financing schemes

Financing Agents (institutional units)

Government

units

FA.1.1, FA.1.2

Social insurance

funds

FA.1.3

Insurance

corporations

FA.2

Households

FA.5

Rest of the World

FA.6

Government schemes

HF.1.1

Compulsory social

health insurance

HF.1.2.1

Voluntary health

insurance

HF.2.1

Out-of-pocket

payments

HF.3

Foreign aid

programmes

HF.4

10

2. Describing the HF-FA relationship

Description HF code HF description Purchasing agent

FA code FA description Data source(s)

Central govt. financing of public health activities

HF.1.1.1 Central governmental schemes

Ministry of Health

FA.1.1.1 Ministry of Health

MoH

Statutory social health insurance (SHI)

HF.1.2.1 Social health insurance schemes

General regional funds

FA.1.3.1 Social Health Insurance Agency

NHF

Industrial branch-based sickness funds

FA.2.2

Mutual and other non-profit insurance organisations

NHF

Sickness funds for farmers

FA.2.2

Mutual and other non-profit insurance organisations

NHF

Sickness funds for miners

FA.2.2

Mutual and other non-profit insurance organisations

NHF

Retirement funds

FA.1.3.2 Other social security agency

NHF

FS

.1

FS

.1.1

FS

.1.2

FS

.1.3

. FS

.1.

4 FS

.2

FS

.3

FS

.3.1

FS

.3.2

FS

.3.3

FS

.3.4

FS

.4

FS

.4.1

. FS

.4.2

. FS

.4.3

. FS

.5

FS

.5

FS

.6

FS

.6

FS

.7

Gov

ern

men

t d

omes

tic

reve

nu

es

Inte

rnal

tra

nsfe

rs a

nd G

rant

s

Tra

nsfe

rs o

n be

half

of

spec

ific

grou

ps

Sub

sidi

es

Oth

er t

rans

fers

fro

m g

over

nmen

t

dom

esti

c re

venu

es

Tra

nsf

ers

by

gove

rnm

ent

from

fore

ign

ori

gin

S

ocia

l i

nsu

ran

ce c

ontr

ibu

tion

s

Em

ploy

ee s

ocia

l in

sura

nce

cont

ribu

tion

E

mpl

oyer

soc

ial

insu

ranc

e

cont

ribu

tion

Sel

f-em

ploy

ed s

ocia

l in

sura

nce

cont

ribu

tion

Oth

er s

ocia

l in

sura

nce

cont

ribu

tion

Com

pu

lsor

y p

rep

aym

ent

(oth

er

than

FS

.3)

Com

puls

ory

prep

aym

ent

from

hous

ehol

ds

Com

puls

ory

prep

aym

ent

from

empl

oyer

s O

ther

Com

puls

ory

prep

aym

ent

Vol

un

tary

pre

pay

men

t

Vol

unta

ry p

repa

ymen

t fr

om

hous

ehol

ds

Vol

unta

ry p

repa

ymen

t fr

om

empl

oyer

s

Oth

er V

olun

tary

pre

paym

ent

Oth

er d

omes

tic

reve

nu

es n

.e.c

.

Oth

er

reve

nues

fro

m h

ouse

hold

s

n.e.

c.

Oth

er

reve

nues

fro

m c

orpo

rati

ons

Oth

er

reve

nues

fro

m N

PIS

Hs

n.e.

c.

Dir

ect

For

eign

tra

nsf

ers

All

rev

enu

es o

f fi

nan

cin

g sc

hem

a

Tot

al c

urr

ent

exp

end

itu

re a

nd

cap

ital

tra

nsf

ers

by

fin

anci

ng

sch

emes

O

per

atin

g b

alan

ce

HF.1 Governmental schemes

and compulsory private

schemes

x

HF.1.1 Governmental schemes x x x x x

HF.1.2.

1

Social health insurance

x x x x

x x x x

x

HF.1.2.

2

Compulsory private health

insurance

x x x x x

HF.2 Voluntary health care

payment schemes

x

HF.2.1 Voluntary insurance x x x x x x x

HF.2.2 NPISH financing schemes x x x x x x x

HF.2.3 Enterprises financing

schemes

x x

HF.3 Households out-of-

pocket payment

x x

HF.4 Rest of the world

financing schemes

x x

3. Identifying the flows: revenue-raising

2. An example of a health financing system

3. Mapping SHA 1.0 to SHA 2011

Suggested method:

• For the latest data: Describing health financing systems (as Ch. 1) – i.e. defining financing schemes independently from

the previously used categories of SHA1.0

• For previous years’ data: Mapping SHA 1.0 to SHA 2011 – Connecting SHA 1.0 and SHA 2011

3. Default approach - SHA 1.0 to SHA 2011

Main options to decide:

• mapping to the “default” scheme. For example, HF.1.1.1 is mapped by “default” to HF.1.1.1 Central governmental schemes

• mapping to a different (non-default) scheme. For example, (part of) HF.2.2 may be mapped to HF.1.2.2. Compulsory private insurance. (See Table 3.1)

• the value accounted as spending by HF (under SHA1.0) should be accounted as revenue. (HF.1.1.1 Central governmental scheme versus FS.1.4 Other transfers from government)

• Transactions by governmental financing schemes (HF.1.1) related to health (HC)

• Providing revenues by the government to HF.1.1. and other financing schemes (FS.1, FS.2)

• Transactions made as an intermediary institution (e.g., between foreign NGO and local NGOs)

• Transactions related to government health-related functions (HCR.1, HCR.2)

• Transactions related to resource-generation (human and physical capital and technology)

• Non-health spending by the government units acting as financing agent

4. The government’s role in the health sector

4. Role of the government

Main role of the government’s involvement

Health accounting terms

Regulation Administrative activities of Governmental schemes (HF)

Revenue-raising Provider of revenues

Collecting and pooling Financing agents/schemes collecting and pooling revenues

Purchasing Financing schemes paying for services

Provision of services Owner of providers

5. Interpreting “public” and “private”

Shall we calculate expenditure by financial scheme, revenue of financial scheme, or agent?

• SHA 1.0 defined the private sector as follows: “.. all resident institutional units which do not belong to the government sector.”

• Then: compulsory private insurance and social insurance schemes executed by private insurance companies would be reported under private expenditure, together with voluntary insurance and OOP.

Do we really care about ownership from the policy perspective?

SHA 2011 adopts two approaches:

• From the perspective of financing schemes, the main distinguishing criterion is whether the participation in a scheme is compulsory or voluntary;

• From the perspective of the types of revenues, the key distinguishing criterion is whether the payment or contribution is compulsory or not.

5. “Public” and “Private”

• intends to track as much as possible the route of the total foreign resource flows in the domestic health care system,

• includes not only health-specific aid, but an estimation (imputation) of the part of general budget aid; and other health-specific flows (without aid purposes),

• allows for developing a correspondence to the DAC statistics,

• distinguishes different types of foreign involvement (types of flows and types of institutional units, types of

providers

6. Accounting foreign aid

Two related methodologies:

• a possible way to show detailed relationships between FS, HF and FA in the case of a particular financing scheme

• sectoral accounts (expenses and revenues for individual financing schemes, as well as individual institutional units)

7. Individual schemes and institutional units

• Financing Guidelines will be finalised based on the discussion of this Interim Report by

– Workshop on Implementation …

– participants of the 2011 OECD Meeting of Health Accounts Experts and more widely

– Comments by November 9, 2012

• Finalise the guidelines and make available by end 2012.

Final steps

• COMMENT on the general approaches and content presented in the Interim report;

• PROPOSE any further issues that need to be addressed under the Guidelines

Participating experts are invited to: