Health care financing for the poor in Lao PDR

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Health care financing for the poor in Lao PDR. Student: Walaiporn Patcharanarumol Supervisor: Prof. Anne Mills. Outline of presentation. Introduction User fees and protection mechanisms Lao Peoples Democratic Republic Objectives Conceptual framework and Methodology Work plan and budget. - PowerPoint PPT Presentation


  • Health care financing for the poor in Lao PDRStudent: Walaiporn PatcharanarumolSupervisor: Prof. Anne Mills

  • Outline of presentationIntroductionUser fees and protection mechanismsLao Peoples Democratic RepublicObjectivesConceptual framework and MethodologyWork plan and budget

  • IntroductionThe poor and the health: policy agenda

    PovertyIll health causeeffect

  • IntroductionThe mitigation of impact of user fees on access to health services by the poor Main focus of the study: protecting the poor from the financial burden of user fees charged for public health care services.

  • What is user fee?User fees are payments made by individuals or families at point of service for buying health care services with whatever form of charge and at whatever level of public health care provision

  • User feesThe policy aim: revenue raising, improving health system efficiency and enhancing equity in access to the health systemThe main source of health services financing in some countriesCan be a financial barrier which leads to inequity in access to health care services

  • Protection mechanisms

    FeatureDirect targetingCharacteristic targetingQualificationIncome levelIndividuals characteristicsExamplesPoor familiesArmed forcesChildren < 5 yrPregnant womenAdvantagesTargets the poor directlyLess infoLess cost of adm.Less stigma

  • Experiences on user fees and exemptionsUser fees improved hospital servicesHowever, user fees represented barrier in access to health services, especially for the low socio-economic group. It created a medical poverty trap Ineffective exemption mechanismsInadequate fundingA limitation of administrative capacityInsufficient informationStigmatizationStaff awarenessOptional mechanisms e.g., the Health Equity Fund, Universal Health Care Coverage

  • Lao PDRLao PDR: one of the Least Developed Countries (LDCs)5.3 million populationLife expectancy at birth: 54.3 yearsAdult literacy rate: 66.4%Poverty: 32.7% of total pop (National poverty line = 8.5 USD/person/mo)

  • Health care delivery system in Lao PDR1. Public health facilities533 Health centers122 District hospitals13 Provincial hospitals5 regional and 6 specialized hospitals3 Central hospitalsA district hospital in Savannakhet Province 2. Private sector1990 licensed pharmacies and 261 private clinicsNo private hospital

  • Health care financing in Lao PDRTotal health expenditure: 3% of GDP, 12 USD per capita Household OOP: 58% of total health expenditure1/3 of OOP was spent on user fees in public providers No national health insurance schemeGovernment employee scheme: 16% of total pop Social health insurance:
  • User fees and exemptions in Lao PDRDecree 52 on Medical Services and Guide of the Public Health Minister, 1995Cost recovery in hospital was introduced to generate revenue School children and students, monks and poor people are exempted from payingHospitals are allowed to keep up to 80% of their revenues from user charges (20% of revenue from user charges goes to local government)

  • User fees and exemptions in Lao PDRUser charges:Drugs at cost plus 25% margin Other services such as laboratory, radiology, admission and surgery with a fixed fee schedule.Exemption mechanism is not functioning: the poor lack knowledge and believe that exemption is unrealisticVientiane Time: people do not come to the hospital when they have no money unless they have a serious health problem

  • What do we know?Whats next?

  • Gap of knowledgeNo clear evidence whether exemption influences the poors coping strategies or not. Most studies havent looked at demand sideWhy households do / do not take up exemptions.Which factors might encourage the poor to take up exemptions? There has been little exploration of provider motivations to grant exemptions. Little research has been conducted with a comprehensive view from households, health care providers and policy makers No comprehensive analysis in Lao PDR

  • ObjectivesTo assess the perceptions and preferences of national policy makers on fee exemption policy and implementation. To assess public health care providers behaviour and attitudes on exemption mechanismsTo analyze barriers of access to public health care services, utilization patterns and household illness costs by socio-economic group.

  • Objectives (continued)To assess the strategies households use to cope with medical bills with an emphasis on taking up the exemption mechanism.To analyse the financial implications of alternative protection mechanisms.To identify policy implications for pro-poor financing and provide policy recommendations on improved ways of protecting the poor.

  • Conceptual Framework6Government (Policy maker perspective)

    Health system(Supply-side perspective)

    Household/community(Demand-side perspective)

    IllnessImpact on household budgetPublic health care expenditure implicationPolicy options for protecting the poorUtilization patternPublic Health care financingCost of Illness

    Public health care providers- Health Centre- District Hospital Provincial Hospital

    Policies on health care financing and exemption policyCoping strategies for treatment cost of illness

    Exemption mechanismDemand-side design and implementation

    Supply-side design and implementation

    Policy design and implementation

    Take up?Barriers on access to health care services Policy recommendationTreatment seeking pattern

  • Study settingNational Growth and Poverty Eradication Strategy (NGPES), Lao PDR 2004Totally 142 districts are classified into three groupsVery poorPoorNon poor Savannakhet Province

  • Study settingSavannakhet ProvinceVery poor or poor districtsWhy Savannakhet Province? SafetyPossible to travelNo dialect problemSavannakhet Province

  • MethodologySupply-side perspective1. National policy makers (qualitative method)2. Providers (quantitative and qualitative methods)Demand-side perspective3. Households (quantitative and qualitative methods)Synthesis4. Financial modeling

  • The first sub-study: national policy makers ObjectivesExisting exemption policy (funding, design, implementation)Attitudes on user charges and exemption policyPolicy options for protecting the poorToolKey informant interviews using semi-structured Qnaire

  • The first sub-study: national policy makers Variables (examples)The purpose of user feesWho controls the fee policy?Existence and clarity of national policy on exemption, resource, benefit packageWho decides means testing? What criteria are used for means testing?Relationship between criteria and national poverty criteriaResponsiveness of eligibility criteria to local circumstancesEffective exemption mechanism, how to finance (tax, pre-payment), which option is feasible, not feasible, who and what package will be protected, priority setting

  • The second sub-study: public health care providersBoth quantitative and qualitative methods will be applied to obtain all important information from all levels of public health care providers.Quantitative data: financial data, revenue from user fee, exemption (+/- debt)Qualitative data: attitude and practice on user fee and exemption, factor affecting exemption in practice

  • The second sub-study: public health care providers

    Health care facilitiesSite of study for quantitative methodTools for qualitative methodSavannakhet provincial hospitalProvincial hospitalKI interviewOne FGDAll district hospitals (15 DH)Provincial health office-Four district hospitals4 DH (2 high and 2 low level of exemptions in very poor or poor district)4 DHKI interviewOne FGDSome health centersSome health centers in 1 high and 1 low level of exemption with less leakageOne FGD or KI interview for each health center

  • The third sub-study: household sideThree methods are applied to obtain information from household sideAnalysis of national surveyRapid rural appraisalHousehold case studies

  • The third sub-study: household sideAnalysis of national surveyObjectives To quantify household members information on morbidity rate, use of health services, cost of treatment and transportation cost by socio-economic groupTo determine cost of treatment as % of household income or expenditure

  • The third sub-study: household sideRapid rural appraisal (RRA)It is aimed at exploratory researchto generate baseline datato handle complicated information setsto rank lists of items such as foods and to understand variation and complexity within field settings (Seaman, Clarke et al. 2000)

  • The third sub-study: household sideRapid rural appraisal (RRA)It emphasizes the use of existing datainteraction with local residents anda judicious combination of qualitative methods. Toolssemi-structured key informant interviewsfocus group discussionssupplemented by observation, photographs, and a preliminary review of secondary data. Various techniques e.g., social mapping, wealth ranking with card sorting, and preference ranking

  • The third sub-study: household sideHousehold case studies (by in-depth interview)ObjectivesTo measure costs of treatment in the hospital paid by the householdTo explore coping strategies used by the household to deal with financial costs of illnessTo explore experience and probe attitudes of households on exemptionsTo investigate other barriers of access to health care services

  • The third sub-study: household sideHousehold case studies (by in-depth interview)

    DH = district hospital, PH = provincial hospital* for example death (from disease) at home, giving birth at home without birth attendance

    Two selected districts form the second sub-studyHigh level of exemption Low level of exemptionPoor household Poor household1. Non-use DH and PH*332. Use DH 2.1 Admission33 2.2 Chronic illness33 2.3 Acute care > 2 episode 33Total1212

  • The fourth sub-study: financial modellingObjectiveTo analyze financial implications for health care providers budgets of various options for protection mechanismsData/information neededCoverage data: size and structure of entitled population by protection mechanismUtilization data: pattern and intensity of the utilizationBenefit package and amount of benefit data: over a certain period of time.Expenditure and revenue data

  • The fourth sub-study: financial modellingPossible dummy table

    Status quoScenario IScenario IIScenario IIIScenarioA. Coverage dataAll poorAll poorFor allB. Utilization dataC. Benefit package and amount of benefitOP, IP and P&PIP and P&POP, IP and P&PD. Expenditure of DHSE. Revenue of DHS E1. Government subsidyE2. Revenue from user fees E3. Other revenue SXYZFinancial gap S X S YS Z

  • Diagram of samples and methodsNational levelMOH and NIPHProvincial levelOne provincial hospitalDistrict levelin the provinceAll district hospitalsIn-depth interviewIn-depth interviewVillage level in the 2 districts

    Some health centers12 households for case studySome health centersKI interview, FDG and financial data collection4 district hospitals (low and high exemptions) 12 households for case study1 district hospital with low exemptions1 district hospital with high exemptionKI interview, FDG and financial data collectionFinancial data collectionKI interview, FDG and financial data collectionKI interview

  • Quality assuranceResearcher is going to conduct fieldwork in every group or case by herself with research assistantsResearch assistants: health personnel in Savannakhet Province.Debriefing sessionsUpdated work plan Regular contact with supervisorParticipant checkingTriangulationPeer checking

  • CollaborationNational Institute of Public Health, Lao PDRProvincial Health Department: Savannakhet ProvinceSavannakhet Provincial HospitalDistrict Health Office (two districts)

  • Work plan and budgetDuration of fieldwork: 10 monthsfrom Oct 05 - July 06Total budget requirement for the fieldwork ~ 900,000 baht All costs are covered by Dorothy Hodgkin Postgraduate Award 2004.

  • AcknowledgementTo Prof. Anne Mills for her intellectual guidance and continuing supervision.To advisory committees, Dr. Steve Russell and Dr. Catherine Goodman, for their supports and suggestionsTo DHPA for financial support of my PhD studiesTo IHPP-Thailand

  • Thank you for your attention

    Let me give a brief introduction. Recently, the poor and the health of the poor have received an increasing amount of attention in the international policy agenda. Poverty is both a cause and effect of ill health. The poor often have inadequate resources to pay for health services and ill health can push them further into the poverty trap. The mitigation of impact of user fees on access to health services by the poor is important. This study focuses on protecting the poor from the financial burden of user fees on access to public health care services. Therefore all of the following parts in this study are considering the health system in the public sector only.What is user fee? User fees define as payments made by individuals or families at point of service for buying health care services with whatever form of charge and at whatever level of public health care provision.In theory, user fees have three main purposes which are to improve efficiency, to improve equity and to generate more revenue for the health care system. User fees in the public sector and out of pocket payment in the private sector are currently the main source of health services financing in some countries. However, out-of-pocket financing is not an equitable source of financing. Where there is a lack of effective exemption mechanism to the poor, user fees will be a financial barrier which leads to inequity in access to health care services.How can we protect the vulnerable groups from user fees? This slide shows two types of protection mechanisms, direct targeting and characteristic targeting. Direct targeting involves identifying families who are cannot afford to pay. A process of identifying is called means testing. When a family has an income that falls below the income level set by policy, this family is eligible for the exemption. It will be direct benefit to the poor. However, means testing is time-consuming and costly.Characteristic targeting is the provision of exemption to people with special groups regardless of income level for example children under 5 years old or pregnant women. Characteristic targeting may cover some of the poor but does not directly target the poor for benefit.Many developing countries have adopted user fees in their health care financing systems. some studies indicate that user fees improved hospital services. However, it created a medical poverty trap. Most studies show that exemption mechanisms are not well functioning due to many problem such as inadequate funding, limitation of administrative capacity, insufficient information on both supply and demand-side, stigmatization to the poor and staff lack awareness. Some studies show alternative ways of protecting the poor for example the Health Equity Fund in Cambodia and Universal Health Care Coverage in Thailand.Now we know purposes of user fees and how to protect the vulnerable groups as well as experiences of user fees in practice. Let see the situation in Lao PDR. I will give you a short background...