Strategic purchasing for UHC: experiences from Lao PDR

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1 Lao PDR Strategic purchasing for UHC: experiences from Lao PDR Strategic purchasing for UHC: unlocking the potential Global meeting, April 2017, Geneva, WHO Presented by Representative from Lao PDR 1 Sustainability 1 &

2 Current situation in Lao PDR and plans for expansion of coverage towards UHC 2 Sustainability 2 &

3 Population MOH/NHIB Strategy on extending SHP Today NHI Reform SSO/SSAS? SSO/SSAS SSO/SSAS FREE MCH Uninsured User Fees (RDF+Tech Fees) FREE MCH NHI NHI MNCH is included in benefit package for all citizens NHI NHI CBHI HEF Poor Poor Poor At this stage, SHP schemes only pay for the direct costs of treatment (drugs, supplies, diagnostics, food/transport allowances), limited operation costs and some incentives. Not pay for preventive services, salaries, overall operation costs of facilities, and investment.

4 Trend in SHP membership coverage * With NHI implementation in 10 provinces Source: MOH National Health Insurance Bureau, report 2016 (draft) SHP membership theoretic coverage is quickly increasing with the 4 launching of the National Health Insurance (NHI) scheme

5 Purchasing of health services in Lao PDR National Health Insurance Bureau Drugs and consumables Public providers Central hospitals Capitation, case-based payments, Fee for service Private providers Clinics Provincial hospitals District hospitals Health centers Users Out of pocket paymentsce Department of Finance Salaries, investment, equipment Line item budget Health Sector Reform Framework: increase coverage of financial protection, reduce OOP, adopt appropriate provider payment mechanisms

6 Provider Payment in 2016 Capitation Risk adjusted capitation for chronic disease Cost sharing for high cost Capitation for lower level Case-based for higher level Fee for service 3 rd level referral Food and transport allocation for IPD Capitation for OPD Case-based for IPD Case based Food and transport allocation for IPD Case based Food and transport allocation for IPD Incentive for completion of 4 ANC

7 Challenges for use of mixed provider payment mechanisms 7 Sustainability &

8 Equity of access Different rates for formal and informal sector scheme but also contracting at different levels > harmonization planned Free MCH and HEF budget integrated into NHI budget > no incentive for health workers to attract poor, and mothers and children Poor and MCH services are exempted from copayment and food allowance and transportation provided 8 Sustainability 8 &

9 Sustainability of financing mechanism Complains by providers about deficit Over use of certain schemes especially CBHI Deficit because of the income from health insurance (reimbursement) is lower than hospital charge, (different between cost vs. charge)? Use of revenues which exceed initial budgeting need special approval Health Insurance Management Committee at national level approves and revises PPMs and payment rates > timeliness of payments needs improvement 9 Sustainability 9 &

10 Quality of services Decree 349 on use of technical revenue > can be used for setting incentives but no harmonized implementation yet Change in financial management at health facilities being based on fees from services to insurance payments Division between supply side financing and demand side financing > appropriate mix given capacity at facility level? 10 Sustainability 10 &

11 Way forward towards more strategic purchasing 11 Sustainability &

12 Mixed provider payment mechanism The current mix between capitation and casebased payments is simple enough to be managed by NHIB and facilities But How can it encourage quality improvement? - Which information on utilization is needed? - Absence of accreditation of health facilities limits possibilities for contracting? - Links with incentives paid under decree 349? 12 Sustainability 12 &

13 Kop chai Thank you for your attention 13 Sustainability &