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Dr PHUA Kai Hong AB cum laude SM (Harv), PhD (LSE)
Lee Kuan Yew School of Public Policy
National University of Singapore
PUBLIC-PRIVATE PARTICIPATION
IN UNIVERSAL HEALTH COVERAGE
The Challenge of Universal Health Coverage
• Achieving UHC globally is a noble ambition
– Can transform more lives than any anti-poverty schemes
– 150 million people each year in developing countries suffer financial catastrophe for healthcare expenditures
• Challenge is how do we deliver on this goal?
– no silver bullet or one-size-fits-all formula
– path to UHC is complex and contingent on conditions
• Developing countries have to address health policies
– What? Where? When? How? How much? (Efficiency)
– Who pays? Who benefits? (Equity)
Complex Issues in Providing Universal Health Coverage
• Free healthcare is alluring
– Important that countries do not jump on bandwagon without undertaking health infrastructure reform
• Capacity problems may become exacerbated
– “free” national health programmes will unleash unexpected demand and supply (moral hazard)
• Having more money in risk-pool but not managing its proper utilisation
– Will lead to greater inefficiency as well as inequity
– Needs to be effective balancing on the supply side
Social Goals of the Optimum Mix
Seeks to balance between extremes
State Monopoly Total tax-funded
Social insurance
- ‘Free’ services
- Low quality
- Inefficiency
Free Market Pure profit-making
Private insurance
- Moral hazard
- Adverse selection
- Inequity
Effective delivery of UHC requires public-private/non-profit participation
• Government and public sector – Investments in public health measures and PHC
e.g. sanitation, vaccination and MCH services
– Focus limited resources on supplying essential targeted services to the poor
• Participation of private and voluntary sectors – Ensures that everyone’s choices are best served
– Allows room for competition and innovation
– Mobilises additional resources to meet needs
– Utilizes local elements and enhances “buy-in”
– Involves altruistic and charitable values
Private sector has important role for Universal Health Coverage
• Many downplay role of private/voluntary providers
– In Africa, 50% patients use non-state/private providers
– In Asia, 3/4 of the poorest children do so
• Instead of duplicating private/non-profit services
– Government should ensure that private sector serves the interest of the poor through effective collaboration
– “Win-win” positions to enhance synergy
• Appropriate regulation of private sector required
- Checks and balances of stakeholders’ interests
Role of non-profit providers is important…
• Non-profit providers include:
– Voluntary welfare organisations
– Faith-based/religious organisations
• Driven by humanitarian objectives
– Help mobilise scarce resources towards the poor, vulnerable and marginalized
– Identify new needs and may close gaps that public and private providers cannot address
– Provide checks against excessive profit-seeking
– Moral compass for both public and private goals
Public-Private Healthcare Allocation - What is Public and What is Private?
26
% of population
$ per personX
H1
T1
X1
Private Public
Total (x)
OOP Expenses
Health Expenditure Density Functions
2
Catastrophic Care
Primary Care
Acute Care
Chronic Care
World Bank Study of Hospital Reforms - Successful Characteristics
• Coherent incentive regime - Autonomy/corporatization • Covered all critical elements - Human resource - Financing • Complementary reforms - Stewardship - Good governance - Performance-based purchasing - Functioning markets - Information
Medisave
Medishield Life
Medifund
PRIMARY
CARE
ACUTE
CARE
CATASTROPHIC
(LONG TERM CARE)
Financing
Private
Payment
Compulsory
Savings
Social/Private
Insurance
PUBLIC SUBSIDIES Source: Dr. Phua Kai Hong
Taxes PUBLIC HEALTH SERVICES
(Eldershield)
Singapore’s Optimal Health Financing
for Universal Health Coverage
Public Policies to Cost-Share
Tax Financing with Savings and Insurance
Provider/
Organization
Social
Insurance
Private
Insurance
Patients/
HouseholdsSavings Premiums
Prepaid
Premiums
Government
Pricing?Subsidy?
Towards an Optimal Public-Private Balance in Health Care Systems?
• Universal coverage of basic health care
• Choice of public, private or voluntary systems
• Competition and integration between public, private and voluntary (non-profit) sectors
• Appropriate mix of provision and financing
• Targeted public subsidies to address inequity
• Co-payment at the point of consumption
• Selective risk-pooling to avoid moral hazard
• Government benchmarks for prices & quality
Paradigm Shifts in New Public Governance for Universal Health Coverage
Universal Health Coverage
Government
Civil Society Business
Democratization Globalization
Public-Private Participation
National/Societal
Provision/Financing/Regulation/Information
Local/Community
Individual/Family
Public /
Government
People/
Civil Society
Private/
Business
Policy Levels
Sectors
Integrated Health Governance – The Whole of Society Approach
Thank You for your Attention!