New methods of financing the health system in

Republic of Albania

Elvana HANAGeneral Director

Health Insurance Institute

Tirana on 09 June 2008

THE STRUCTURE OF PRESENTATION

An overview of Health System and Health Financing Systems

Changes at Primary Health Care financing (achievements and problems)

Changes at hospital care financing. Study case – Durres Hospital – as a model for further developments.

Pharmaceutical services – Totally private but it remain too far from European standards. The Project of electronic control of pharmacies and drugs.

Short term efforts of Health Insurance Institute to further increasing of financing health services efficiency.

GENERAL FRAMEWORK

Health services in Albania are provided by a mix public and private services providers

Hospital services are provided by MoH and other public institutions.

PHC is provided through a general practitioners and private network well developed at this sector.

Pharmacies, dentists, and other supported health services are totally private.

Ministry of Health remain the main actor at policy making and the regulator of health system.

Local Governance is another actor in allocation of public funds for health sector at regional level.

THE SOURCES OF PUBLIC FINANCING FOR HEALTH

State budget Ministry of Health Ministry of Defense (Military hospital) Ministry of Justice (Prisons)

The obligatory contribution of health insurance Are gathered by Tax Office – HII

Directly payments / co-payments Other donors

Public expenditures for health share only 2.7% of GDP

Albania’s health delivery and financing structure – note the fragmentation of the funds

PHC Centres, GPs

Insurance Contributions

Patient Out-Of-PocketPayments (co-pay)

Taxation Authority

Health Insurance Fund/ Institute

MOH Budget

MOF Budget for Health

Municipal Councils

Hospitals

Health funds according to services (Total 2008 - 30 348 milion lek)

Primary Health Care 42%

Hospital care 52%

Planing, management administration

3%Public Health

3%

THE PROBLEMS AT PRIMARY HEALTH

CARE SERVICES

Administration of PHC Health Centers

Dual independence, institutional and financial (HII - MoH)

Fragmented financing of primary health care Payments from HII, only for Family doctors –

discouraged for team work – indifferent to the quality

Lack of Autonomy for HC Low deposits of secondary incomes – main reason

of informal payments

THE PROBLEMS AT PRIMARY HEALTH CARE SERVICES

Providing of health services and their quality

Lack of standard packages of health services for providers of services

Partly standard for health services level and norms of coverage the population within ambulatory care (the rapport (doctors/nurses and norms of coverage for nurses staff)

Lack of measures and evaluations indicators for quality of health services

Standards not completed for protocols of ambulatory treats from GFP

Lack of basic equipments for services

REFORM AT PHC

Based on: Law No. 7870, dt. 13.10.1994 “For Health Insurance in Republic of

Albania” changed DCM. No. 857, dt. 20.12.2006 “For financing of PHC services from

obligatory scheme of Health Insurance”

After January 2007, HII / RDHI has contracted with almost 420 Health Centers (HC) all over the country

Any of Health Center – juridical entity with their own account The Director of HC – representatives of HC for health insurance

relations The contracts are based at the offered packages of services 1625 General / Family Practitioners and 6636 nurses contracted to

provide general services at HC.

REFORM AT PHC

Move to a single purchaser financing for health services.

Autonomy on Management, organization and operation of HC

Definition of actors role on the system.

Development of new method of payment for HC. - Application of a mix payment formula:

- 85% fix budget, - 10% monthly added payment based on the

activities of the HC - 5% bonus payment 3 month based for HC

which fulfils the quality indicators.

Increasing of payment level for services providers.

REFORM AT PHC

Setting up the necessary framework for health services market function.

- Opportunity to exercise their profession as individual contractor / or private

Installation and using an unique system of information for all HC.

Setting up the necessary framework for HC to manage the allocated funds.

- New opportunity for increasing and using second incomes

HOSPITAL SERVICES

The hospital care in Republic of Albania is public service.

Actually there are 36 hospitals. Number of beds - 9586 beds which means an average of 1 bed for 322 habitants or 3.1 beds for 1000 habitants. This figure its quite high considering the actual economic situation in Albania as well as low utilization of the bed, with an average during last years, 50-55%.

Number of the beds has been continually decreasing due to strengthening of the primary health care.

HOSPITAL SERVICE

Physical structure of the hospital is under the desired level due to problems related with objective lack of infrastructure at the regional level as well as periodicities of investments provided by Ministry of Health especially for medical equipment, maintain and consume facilities.

Some serius problems which reflcts at the quality and effectivenes of the hospitals are related with lack of norms of, medical and supported staff as well as standard protocols of treatment.

The information system for the identification and evaluation of hospital activities its missing.

All those factors as well as low level of financing and weak management have their negative impact on the services ofered by them.

DURRES HOSPITAL EXPERIENCE

Goal:

Preparing the organizational, administrative and financial situation for including the hospitals at health insurance scheme

ACHIEVEMENT OF THE PROJECT

Hospital as juridical entity: Administrative independence

Management – Board

Financial independence Financing from HII – own decisions for using of

secondary incomes funds.

More efficiency in using the health insurance funds through: Setting up an coherent information system Processing of payment method for DRG Compiling of hospital treatment protocols

PHARMACEUTICAL SERVICES

Open pharmaceutical services, totally privatized.

Monitored from Ministry of Health and National Center of Drugs Control.

Over 80 wholesalers and 900 pharmacies and agencies.

The Basic List of Reimbursement Drugs (374 drugs) is compiled by “Commission of Compiling and Reviewing of Reimbursement List of Drugs” and from “Commission of Drugs Prices” setting up with order of Minister of Health and approved by Council of Ministers with proposal of Minister of Health once a year.

Policies at pharmaceutical sector: rational usage of a number of effective drugs, safe and with high quality, as well as available and with a reasonable price for all the population.

ACHIEVEMENTS AND PROBLEMS

The reforms at the sector and implementation of the pharmaceutical policies have positive results on some directions such as: furnishing of the market with a mix kind of drugs (3500 registered drugs), re-activate of domestic production, registration of the drugs, expanding of drugs delivery, setting up of the new information base for drugs.

Problems: Lack of transparency at prices of the drugs Circulation of contraband drugs as well as registration of

ineffective drugs, which are appealing from patients, doctors and pharmacists.

Lack at the information system, which need to include all the units such as inspection, registration, information about drugs, etc.

PROBLEMS WITH REIMBURSEMENT LIST OF DRUGS

The reimbursed drugs and the cost of reimbursement are not managed by HII

Albania pay higher price for some drugs compare with other countries in the region such as Slovenia – some time 89% higher.

The priority and cost-effectively are not the critters for compiling the list of drugs

The new entry at the list of drugs are not accompanied by financial support for HII.

The physicians prescriptions consist in more drugs and of drugs with higher cost. (due to mentality and professional education)

OBJECTIVES OF HII ON THE FUTURE

The reimbursement list of drugs consist on:

Part I – include drugs 100% reimbursed of the drug price

Part II – include drugs with co-payment for the drug price

IMPROVEMENT OF THE GOVERNANCE ON THE HEALTH SYSTEM

Compiling of basic legislation for health care as well as for obligatory scheme of health insurance

Reviewing of licenses and accreditation procedures for public and private system

Regulation of contractual relation for strategic purchaser.

IMPROVING THE HEALTH SYSTEM FINANCING

Reinforcement of HII role as strategic purchaser of health services in public and private system

Improvement of collecting contribution system Efficiency at collecting contribution from salaries Consolidation of contributions from obligatory

insurance for inactive population, from state budget

Reconsideration of the contribution rate Decreasing of informality

Presentation of co-payment Identifying the insured population through health

card Utilization of secondary incomes

ENCREASING OF MANAGERIAL CAPACITIES AT HEALTH SERVICES

Expanding of partnership public-private Encouragement of special service

privatization at all the levels of health care

Reposition of manager role at public health institutions

Setting up the standards, norms and clinical protocols in management of health services.

Consolidation of quality approach system and security of health system

INCREASING OF ACCESS AT EFFECTIVE HEALTH SERVICES

Define of basic package of health services and its monitoring

Re construction of health service providers network Restricted due to geographical, demographic

and privatization policies conditions

Improvement of refer system

Maintaining and developing of programs for public health