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International Health Policy Program -Thailand 1 Healthcare Financing in Thailand: an update in 2007 Updated by International Health Policy Program (IHPP) Ministry of Public Health, Thailand

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International Health Policy Program -Thailand 2 Outline presentation I. Background information on burden of disease and health care finance IA. Burden of Disease in 2004 & national health expenditure, 1994 2005 IB. Healthcare financing performance Fairness in financial contribution EQUITAP results Incidence of catastrophic and impoverishment from OOPs Equity in utilization & benefit incidence analysis (BIA) II. Ongoing major works IIA. Universal offer of VCT IIB. Major program review of cervical cancer control IIC. Review of DCP2 and its application in chronic diseases management IID. Annual hospital report III. Future challenges: Renal replacement therapy, financial sustainability, and potential moral hazards, etc.

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International Health Policy Program -Thailand 3 IA. Background information: BOD and financing healthcare

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International Health Policy Program -Thailand 4 Profile: top 10 mortality, Thailand 2004 Total deaths 390,285 Top 10 deaths share 63% of total national deaths

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International Health Policy Program -Thailand 5 Top 10 YLL shares 63 % of total national YLL Profile: top 10 YLL, Thailand 2004 Total YLL 6.07 million years

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International Health Policy Program -Thailand 6 Profile: top 10 YLD, Thailand 2004 Total YLD 3.1 million years Top 10 YLD shares 71% of total national YLD

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International Health Policy Program -Thailand 7 Profile: top 10 DALY loss, Thailand 2004 Total DALY loss 9.17 million years Top 10 DALY shares 52% of total national DALY loss

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International Health Policy Program -Thailand 8 DALY loss by age group and gender, Thailand 2004

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DALYs per 1,000 population, ranked 22 categories

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International Health Policy Program -Thailand 10 Top 15 risk factors, men Thailand 2004

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International Health Policy Program -Thailand 11 Top 15 risk factors, women, Thailand 2004

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International Health Policy Program -Thailand 12 Total Health Expenditure, NHA 1994 2005

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International Health Policy Program -Thailand 13 Real term growth GDP versus THE, 1994-2005 13

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International Health Policy Program -Thailand 14 THE, Baht per capita NHA 1994-2005 current and constant price (2003) 14

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International Health Policy Program -Thailand 15 Trend of financing sources NHA 1994-2005

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Trends of financing agents, NHA1994-2005

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Expenditure by financing agent NHA2005

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Expenditure by public financing agents, NHA2005

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International Health Policy Program -Thailand 19 Expenditure by healthcare Function NHA2005 19

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International Health Policy Program -Thailand 20 CSMBS total expenditure and growth 1988-2006 Source: Comptroller General Department, Ministry of Finance (various years) million of employees/pensioners

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International Health Policy Program -Thailand 21 IB. performance of UC scheme

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International Health Policy Program -Thailand 22 Why general-tax-financed UC Scheme? Contributory UC Scheme was not in the policy agenda during 2001 general election, Feasible to apply general tax, additional budget requirement was in fiscal capacity Not feasible to collect premium Urgency to nation-wide scale up immediately, political obligations to the constituency Subsequent studies indicate the Concentration Index of various sources of healthcare finance Thailand 2002 (ODonnell et al 2005) CI weight NHA Direct tax 0.90570.1868 Indirect tax 0.57760.3155 Social insurance0.57600.0582 Private insurance0.39950.0668 Direct payments0.48640.3728 Total Health Financing 0.5929 General Tax 0.6996 Note: CI, an index of the distribution of payments, ranges (-1 to 1), a positive (negative) value indicates the rich (poor) contributes a larger share than the poor (rich), a value of zero is everyone pays the same irrespective of ability to pay

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International Health Policy Program -Thailand 23 Contribution of Social Health Insurance (SHI) to UC Scheme system design SHI as a predecessor of UC Contract model contractual arrangement with competitive public and private provider contractors Contract is feasible in the context of comprehensive geographical coverage of MOPH healthcare infrastructure Closed-ended provider payment method Among a few developing countries, Thailand pioneers capitation payment method Additional pay for A&E, high cost care, based on fee schedule Purchaser Provide split Social Security Office and National Health Security Office as purchasers design packages and payment methods MOPH, other public and private medical institutions as major providers Comprehensive coverage Comprehensive service package, OP, IP, Prevention, Promotion Neither deductibles nor co payment at point of services, UC scheme has nominal pay of US$ 0.75 per visit or admission

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International Health Policy Program -Thailand 24 Advanced characteristics of the UC Scheme

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International Health Policy Program -Thailand 25 Capitation rate Capitation rate and components Baht per capita, approved fig. 2002-2007, plan fig. 2008

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International Health Policy Program -Thailand 26 IHPP calculates capitation rate based on actual utilization rate and unit cost. Due to fiscal constraint, it results in discrepancy Discrepancy: proposed & approved capitation rate FY2002-2006

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International Health Policy Program -Thailand 27 Household health expenditure as % of household income by income deciles prior to UC (1992-2000) and after UC 2002-2006 Source: NSO SES (various years)

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International Health Policy Program -Thailand 28 Distribution of households with health expenditures > 10% total consumption by consumption expenditure quintiles Source: NSOs SES (various years)

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International Health Policy Program -Thailand 29 Catastrophic health payments in Thailand, 1996-2002 % non food expenditure on health 1996199820002002 0 to 0.5%31.933.234.541.2 0.5 to 10%51.351.550.848.1 10 to 25%11.910.911.07.6 25 to 50%3.53.63.12.5 More than 50%1.40.80.70.5 Total100.0 Source: National Statistic Office, Household Socio-economic Survey, various years.

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International Health Policy Program -Thailand 30 Pre-post UC incidence of catastrophic expenditure Households with health payment > 10% of total consumption expenditures All households LIC/VHC UCE/-P Year 2000 Quintile 14.0%2.7% Quintile 55.6%7.1% All Quintiles5.4%4.7% Year 2002 Quintile 11.7% Quintile 55.0%6.1% All Quintiles3.3%3.2% Year 2004 Quintile 11.6% Quintile 54.3%5.2% All Quintiles2.8%2.6% Year 2006 Quintile 10.9% Quintile 53.3%3.0% All Quintiles2.0%1.9% Source: NSOs SES (various years)

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International Health Policy Program -Thailand 31 Impact of UC: Catastrophic illnesses, impoverishment Limwattananon et al 2005 Dataset : NSO SES 2000 (24,747 households), 2002 (34,785) and 2004 (34,843). Finding The incidence of catastrophic health expenditure (>10% of total HH consumption) reduced From 5.4% in pre-UC 2000 to 3.3-2.0% in post-UC 2002-2006 An increase in the poverty headcounts due to OOP payments dropped From 2.1% in pre-UC to 0.8-0.5% in post-UC. Conclusions Reduction in the catastrophe and impoverishment due to OOP health payments is evident after the UC reform which provides comprehensive coverage of health care with a very small nominal fee.

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International Health Policy Program -Thailand 32 Healthcare Catastrophe vs. OOP Payments & Income data as of 2000 Source: van Doorslaer et al. (2005)

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Utilization by UC members s ource: NSO HWS2001, 2003, 2004, 2005 and 2006

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International Health Policy Program -Thailand 34 Total Ambulatory Visits (millions/yr) (HWS 2001, 03, 04, 05, 06) LIC/VHC & UC-E/-P SSS CSMBS

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International Health Policy Program -Thailand 35 Average Ambulatory Visits (per member/yr) (HWS 2003, 04, 05, 06) UC-E/-P SSS CSMBS 1.86 2.18 2.07 1.53 1.13 1.09 1.12 0.91 1.80 1.98 1.93 1.67

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International Health Policy Program -Thailand 36 Insurance Use for OP Visit (% compliance) (HWS 2003, 04, 05, 06) UC-E/-P SSS CSMBS

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International Health Policy Program -Thailand 37 Total Hospital Admissions (millions/yr) (HWS 2001, 03, 04, 05, 06) LIC/VHC & UC-E/-P SSS CSMBS

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International Health Policy Program -Thailand 38 Average Hospital Admissions (per member/yr) (HWS 2001, 03, 04, 05, 06) LIC/VHS & UC-E/-P SSS CSMBS 0.09 0.08 0.09 0.08 0.08 0.06 0.06 0.07 0.06 0.07 0.10 0.09 0.12 0.11 0.08

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International Health Policy Program -Thailand 39 UC-E/-P SSS CSMBS Insurance Use for IP admission (% compliance) (HWS 2003, 04, 05, 06)

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International Health Policy Program -Thailand 40 The distribution of ambulatory service use among different income quintiles in 2001 and 2003, by types of health facilities 2001 2003 Concentration indices of ambulatory service use among different types of health facilities in 2001 & 2003 Type of health facilities20012003 Health centers - 0.2944- 0.3650 Community hospitals- 0.2698- 0.3200 Provincial and regional hospitals- 0.0366- 0.0802 Private hospitals0.43130.3484

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Selected concentration curves of ambulatory service use among different types of health facilities in 2003

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International Health Policy Program -Thailand 42 The distribution of hospitalization among different socio-economic groups in 2001 and 2003, by types of health facilities Concentration indices of hospitalization among different types of health facilities in 2001 & 2003 Types of health facilities20012003 Community hospitals - 0.3157- 0.2934 Provincial and regional hospitals- 0.0691- 0.1375 Private hospitals0.31990.3094 Overall hospitalization- 0.0794- 0.1208 20032001

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Selected concentration curves of hospitalization among different types of health facilities in 2003

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International Health Policy Program -Thailand 44 Who benefits from public subsidies Limwattananon et al 2005 Benefit Incidence Analysis: compare pre-UC 2001 and post-UC 2004 using NSO HWS2001, 2004 OP care Post UC 2004, the pro-poor subsidy was very pronounced at District Health System (DHS) Concentration Index = - 0.3326 and - 0.2921 for Health Centre and District Hospital respectively. Less progressive at provincial hospitals (PH) CI = - 0.1496. IP care More progressive in favour of the poor at DH CI = - 0.3130 in 2001 and - 0.2666 in 2004. Weaker progressive in favour of the poor at PH CI = - 0.1104 in 2001 and - 0.1221 in 2004 Conclusions The pro-poor subsidy were strongest for DHS. Lessons indicates DHS plays key role in fostering the pro-poor nature of public subsidy. Close to client services, better accessed

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International Health Policy Program -Thailand 45 Percent distribution of net government health subsidies among different income quintiles in 2001 and 2003 Note: -Overall net government health subsidies in 2001 were approximately 58,733 million Baht, and in 2003 were 80,678 million Baht (in 2001-value) - The concentration index of government health subsidies in 2001 was -0.044 and in 2003 was -0.123

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International Health Policy Program -Thailand 46 Concluding remarks 1 Enabling factors for achieving UC Strong political supports Health systems capacity and its resilience to rapid nation-wide program scale-up in 6 months Lessons from predecessors SHI capitation contract model CSMBS no go fee for service, due to cost escalation and inefficiencies Voluntary Health Card Scheme adverse selection and non-viable financially Linking evidence to policy decision Integral relationship among researchers reformists politicians Pragmatism Limited chance to achieve UC by contributory scheme, especially among informal sector, not feasible for contribution collection and enforcement Learning from SHI, UC takes further advanced steps, Well thought systems design towards efficiency, cost containment, ensure referral, advocates of primary care contractor

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International Health Policy Program -Thailand 47 Concluding remarks 2 UC Schemes covers the poor, half belongs to Q1 and Q2 However, the Scheme faced chronic under-funding, capitation was below than the proposed figures based on cost and utilization Significant increase in utilization more on OP than IP In view of under-funding and increased utilization danger of poor quality of services and serious hospital financial constraints Empirical evidence indicates Pro-poor budget subsidy, DHS is a major hub of fostering the pro- poor nature of financing healthcare Policy msg. invest more in DHS (further) reduction in the incidence of catastrophic illnesses (further) reduction of impoverishment from medical bills

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International Health Policy Program -Thailand 48 IIA. Ongoing major work: Universal offer of VCT

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32.6% 10.4% 39.7% 11.7% The potential VCT uptake with zero price Current price

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Predicted Demand for VCT by Regions IDU MSM SW Gen. Pop.

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International Health Policy Program -Thailand 51 IIB. Ongoing major work: Major program review of cervical cancer control

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International Health Policy Program -Thailand 52 National Coverage of Cervical Cancer Screening (Household Survey -2006) Source: NSOs Sexual and Reproductive Health Survey (2006)

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International Health Policy Program -Thailand 53 Reported Achievement by Set Targets (2005) Source: NHSO (2006)

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International Health Policy Program -Thailand 54 Work Components

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International Health Policy Program -Thailand 55 IIC. Review of disease control priorities (DCP-2) and its application to the 10 th National Health Development Plan

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International Health Policy Program -Thailand 56 Objectives of the study on DCP-2 and the 10 th National Health Development Plan To review patterns of burden of disease and risk behavior of Thais in 1999 and 2004 To review cost-effective medical treatments and public health interventions suggested by DCP-2 in accordance to BOD of Thailand To explore similarity and dissimilarity of current practice for disease control and prevention on top-ten priority of disease burden in Thailand, compared to suggestions from the DCP-2 To estimate the magnitude of government investment in disease prevention and reduction in health risk behavior, health promotion, screening and early detection of disease in high priorities, compared to investment in curative interventions To provide policy recommendations on improving efficiency and efficacy of public investment in health promotion, disease prevention, curative interventions, and economic gains from more investing in health To develop plan and framework for investing in health and estimate the medium term expenditure framework (MTEF), compared to government health budgets

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Scope of the study Review burden of disease (BOD) and risk behavior of Thais in 1999 and 2004 Select top-ten burden of disease contributing to highest DALY loss in 2004 as the scope of the study Review recommendations for effective medical treatments and public health interventions in DCP-2, compared to current practice and clinical guideline practices in Thailand Provide policy recommendations for improving efficiency in health investment in health promotion, disease prevention, screening, curative and reducing risk behavior Estimate public resources required for investment in health promotion, disease prevention, and public health program in reducing risk factors and behavior of each disease, compared to curative program and other sectors Estimate budget requirements for health investment in the 10 th National Health Development Plan and present research findings for public hearing of all stakeholders

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International Health Policy Program -Thailand 58 IID. Sustainable Development of Healthcare System Performance in Thailand

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International Health Policy Program -Thailand 59 Objectives To review previous studies of Thai healthcare performance and current approaches from international perspectives Based on process of consultation and consensus agreement among major stakeholders in Thailand, to develop and conceptualize the Thai healthcare system performance framework To build up institutional capacity and foster networking with all stakeholders and technical partners for a long term national capacity in healthcare performance assessment To assess and produce a public report on Thai healthcare performance in for FY2007 (pilot phase in 4 Provinces) To develop strategy and policy approach to catalyze improvement in the performance in the positive ways

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International Health Policy Program -Thailand 60 Conceptual Framework of Healthcare System Performance Review: Concept; Domain; Indicators; Information system Review Existing: Indicators; Data source; Information system Thai conceptual Framework: Goals; domain; Indicators; data Gap?: Data (available; quality) Information system; DevelopMeasure Level: Hospital and CUP Report: Level (province, region) Indicators Benchmarking Analyze, Synthesis Revised Improvement: Personnel; IT; Management Survey? Users: Public Central government Local government Healthcare planner Hospital manger Health insurer Academia

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International Health Policy Program -Thailand 61 III. Future challenges

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International Health Policy Program -Thailand 62 Prevalence Hypertension: 23% male, 21% female All samples are hypertensive, >140/90 mmHg,

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International Health Policy Program -Thailand 63 Prevalence DM: 6% male, 7% female All samples have FBS, >126 mg/dl

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International Health Policy Program -Thailand 64 Death from Diabetes PoorestRichest Death rate Diabetes death

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International Health Policy Program -Thailand 65 Death from Ischemic Heart Disease PoorestRichest Death rate IHD death

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CEA and CUA societal perspectives PD and HD at NPV 2005

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Budget impact analysis 2 scenarios: universal versus limited access to RRT at the lowest cost estimate (250,000 Baht / case/ year) 2005 (year 1) 2009 (year 5) 2014 (year 10) 2019 (year 15) Universal access to RRT (million Baht) 3,99418,05832,25543,804 As % of UC budget5.518.423.723.6 As % of THE1.75.97.7 RRT for KT eligible (mil Baht)1,9818,94415,96621,625 As % of UC budget2.79.111.7 As % of THE0.92.93.8 UC budget (million Baht)73,13698,074135,987185,248 Total health expenditure (million Baht) 230,836303,931417,522572,659

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International Health Policy Program -Thailand 69 Future Challenges (1) Most of the crude ground works had achieved PHC focus and reorientation, pro-poor achievement, extensive financial protection of the poor, very minimum catastrophic incidence, BUT Need to increase value for money Maintain decent quality of care and continued advancement in medical progress Evidence based and learning organization for MOF (CSMBS) SSO and NHSO BOB, MOF Fiscal Policy Office, NESDB Harmonization across 3 public insurance scheme Adequate and sustainable financing of the pro poor UC scheme

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International Health Policy Program -Thailand 70 Future Challenges (2) Focus more on effective coverage of increasing trend of chronic conditions and effective prevention of injuries Renal Replacement Therapy for chronic kidney disease patients is not covered by UC Scheme (while SHI and CSMBS cover fully) Results in catastrophic health expenditure by households Need serious informed policy decision and long term financial implications Cost per life year saved (Teerawatananon et al 2005) Peritoneal dialysis 10,170 US$ Hemodialysis 10,490 US$ Cost per life year saved (Lertiendumrong et al 2005) Antiretroviral Therapy 590 US$ GNI US$ 2,540 per capita (2004 WDR) Cost per life year saved for RRT 4 times of GNI per capita, 18 times as expensive as the current national ART program. Ethical dimension of not extend RRT to UC members

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International Health Policy Program -Thailand 71 Acknowledgments National partners National Health Security Office (NHSO) and other partners who initiate, design and steer the UC scheme HSRI for supports on NHA development since day one until institutionalized HISRO, HISO for their technical and financial supports Ministry of Public Health (MOPH) major healthcare providers and steer the implementation of UC scheme. National Statistical Office (NSO) for national household surveys Thailand Research Fund (TRF) for institutional grants to IHPP International partners World Bank and MOPH partnership on Country Development Partnership in Health Sector ILO for peer reviews of capitation rate 2002, and long term financing forecast 2005-2020 WHO and Harvard for studies on ethical dimension of RRT extension to UC members EU funded Equity in financing, health utilization and public subsidies in Asia Pacific (EQUITAP)