MOH1Care

PHC Financing for 1Care

Dr Rozita Halina Tun HusseinUnit for National Health Financing

Ministry of Health Malaysia15 May 2011

2Source : Health System Financing, WHO Report, 2010

Three Dimensions to Consider When Improving Universal Coverage and

Financing HC

Providing Universal Coverage

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Changing ‘Money follows the facility’ to ‘following the patient’

Population: 138,900MOH Hosp: 1, Private Hosp: 0







Population: 84,600MOH Hosp: 1, Private Hosp: 0Population: 72,500

MOH Hosp: 1, Private Hosp: 0














Population: 28,900 MOH Hosp: 1, Private Hosp: 0


Potential Health Care Markets

PAHANG

PULAU TIOMAN

Rompin

Pekan

Kuantan

JerantutLipis

Temerloh Maran

Bera

Bentong

Raub









Cameron Highlands




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“We cannot allow it to be said by history that the difference between those who lived and died… was nothing more than poverty, age or skin colour.”

John Lewis, Congressman from Georgia,on the devastation caused by hurricane Katrina

Financial Times, 4th September 2005

Ensuring Equity

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Pay according to ability, use according to need.

Targeting of Subsidies in Public Facilities

Source: Rozita Halina, 2000

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Poorest quintiles' shares public health subsidy

0%

10%

20%

30%

40%

50% household expenditure

public health subsidy

The Poor’s share of public health subsidy in Asia

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“Analyzing Health Equity Using Household Survey Data” Owen O’Donnell, Eddy van Doorslaer, Adam Wagstaff and Magnus Lindelow, The World Bank, Washington DC, 2008, www.worldbank.org/analyzinghealthequity

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Poverty Impact of Health ExpendituresPen’s Parade in Malaysia

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In absence of health financing reform, health system likely to become increasingly privatized… both in funding and service delivery……

In the future with no restructuring of the health system…..

Health expenditures per capita, 2009 prices

0

200

400

600

800

1000

1200

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1600

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GGHE pc PvtHE pc

2004 2009 2018GGHE 50% 45% 35%PvtHE 50% 55% 65%-PvtOOP 40% 47%-PvtOther 15% 17%

Source: Dr Christopher James, WHO WPRO – Projections from MNHA data

Future Direction of Current Health System

SOURCE OF INEFFICIENCY COMMON REASONS FOR INEFFICIENCY

WAYS TO ADDRESS INEFFICIENCY

1. Underuse of generics medicine

Lower perceived efficacy/safety of generic medicines;

Develop costs benefits analysis

2. Use of substandard & counterfeit medicines

Inadequate regulatory framework; weak procurement systems.

Strengthen enforcement of quality standards ; enhance procurement systems

3. Inappropriate & ineffective use of medicines

Inappropriate prescriber incentives and unethical promotion practices; inadequate regulatory frameworks.

Separate prescribing & dispensing functions; improve prescribing guidance, information, training & practice;

4. Overuse/supply of equipment, procedures,

investigations

Supplier-induced demand; fee-for-service; defensive medicine

Reform incentive & payment structures (e.g. capitation or DRG); develop & implement clinical guidelines.

5. Health workers: inappropriate or costly

staff mix, unmotivated workers

Conformity with pre-determined human resource policies & procedures; resistance by medical profession; inadequate salaries

Undertake needs-based assessment & training; revise remuneration policies introduce performance-related pay

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10 Leading Sources of Inefficiency

Source: WHO, 2010

SOURCE OF INEFFICIENCY COMMON REASONS FOR INEFFICIENCY

WAYS TO ADDRESS INEFFICIENCY

6. Inappropriate admissions & length of stay

Lack of alternative care arrangements; insufficient incentives to discharge;

Provide alternative care (e.g. day care); alter incentives to hospital providers;

7. Inappropriate hospital size (low use of infrastructure)

Inappropriate level of managerial resources, lack of planning for health service infrastructure development.

Match managerial capacity to size; reduce excess capacity to raise occupancy rate to 80–90%

8. Medical errors & suboptimal quality of care

Lack of guidelines, clinical-care standards and protocols; inadequate supervision.

Undertake more clinical audits; monitor hospital performance.

9. Health system leakages: waste, corruption & fraud

Poor accountability and governance mechanisms; low salaries.

Improve regulation/governance, promote codes of conduct.

10. Inefficient mix/ inappropriate level of strategies for health interventions

Inappropriate balance betweenlevels of care, & or between prevention, promotion & treatment.

Regular evaluation & incorporation into policy of evidence on the costs & impact of interventions, technologies, medicines, & policy options.

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10 Leading Sources of Inefficiency

Source: WHO, 2010

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1Care for 1Malaysia Building a Stronger Health

System

•Putting People First & Personalised Care•Benefits of Integration and Competition•Purchaser-Provider Split•Strengths of Primary Health Care & Gate-keeping•Provider payment mechanisms•Pay For Performance•Higher Health Expenditure for Better Health Outcomes•Public Financing, Social Health Insurance & Government Stewardship•Stimulating the Health Sector in Malaysia

Conglomeration of many features based on currently known global best practices, suitable for the needs of Malaysia now & into the future

• Government commits to higher levels of spending for healthcare• People commit to increased cost sharing through pooling of funds and

cross-subsidy• Universal coverage• Public private integration• Affordable & sustainable health care• Equitable (access & financing), efficient, higher quality care & better

health outcomes through Pay for Performance• Effective safety net• Publicly managed health fund - combination of general revenue &

social health insurance (SHI), and tempered by minimal co-payments at point of seeking care

• Single payer system, the National Health Financing Authority (NHFA) – set-up on a not-for-profit basis under the MOH

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Financial Features of 1Care

• Not-for-profit, autonomous body under MOH• Low administration cost

• Manages overall health care financing in close collaboration with MOH and MHDS

• Main responsibilities include:

– Collection, pooling and payment of the combined health fund

– Design Benefit Package with MOH & MHDS– Monitor fiscal performance of agencies within MHDS– Develop formularies for premiums, PPM, pay-for-

performance and unit costs/fees etc.14

Role of NHFA

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Primary Health Care Thrust of health care services - strong focus on promotive-preventive

care & early interventionFamily doctor & gatekeeper referral systemPayment of provider – capitationAdjusted by case mixIncentives – serving rural populationFFS – specific aspects with strong policy implications e.g. disease

reporting, needle exchange programmes Secondary and Tertiary Health Services

Patients referred by PHCPFinancing (Case mix adjusted)

Global budget for public hospitals Case-based payment for private hospitals & other institutions –

stand alone ambulatory specialist centresPay for Performance

Payment Mechanisms in 1Care

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THANK YOU

[email protected]

Unit for National Health Financing (NHF)Planning & Development Division, MOH

MOH1Care

Health & Medicine

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