Jurnal Kesihatan Masyarakat 2002: Jilid 8 - CORE · Jurnal Kesihatan Masyarakat 2002: Jilid 8 ... .Impression of getting poor value for money ... health and well-being for the present

Jurnal Kesihatan Masyarakat 2002: Jilid 8

HEAL m REFORM AND ITS IMPLICnONS

Khalib Abdul Latip .& Nik Shamsidah Nik lbrahim .

ABSTRACI'

This paper discusses the various types of health reforms, its objectives and principles. Rl&LYtrations and examplesof health reforms were given namely dnlg financing health reform, reform in maternal and child health servicesand health reforms in South Africa, Zambia and Malaysia. Issues in health reforms were also discussed.

INTRODUCI'ION poor value for money (Dekker 1994). Mostattention goes to the supply side, and the refonndebate is dominated by a focus onadministrative/financial and organizational issues(Oevretveit 1994). There is a characteristic shifttowards market-derived incentives in pursuit ofmicro-economic efficiency and control of

expenditure (Saltman 1994).Developing countries are increasingly

interested in following similar approaches in order tocontrol costs, and to correct obvious governmentfailures in financing and provision of health care(World Bank 1993). As in Europe, reliance on theprivate sector and managed markets is supposed toenhance provider efficiency through competition andsubstitution of direct management with contractual

relationship.A growing number of developing countries

are now embarking on reforms in which contractingout clinical services -and specifically hospital care-is the key element. The speed with which theseapproaches have been endorsed in developmentcircles is in sharp contrast with the lack of actualexperience and empirical evidence for success (Carr-Hill 1994). Appropriate regulation technologies andcapacities need to be developed. Reforming thehealth care sector in developing countries is indeedsubject to specific constraints that center around the

government's regulatory capacity and the strength ofits bargaining position (McPake & Hongoro 1995).

From the above discussion, it is noted thatsome of the reasons for health refonn are asfollows:-.Inability to control cost.Crisis in financing health sector.Criticism of bureaucratic rigidity.Impression of getting poor value for money.Governments failure to deliver health care

OBJEcrlVES AND PRINCIPLES OF HEALTHREFORM

What is Health Reform? Health reform meansbuilding on the strength of the current health systemand rcctifying the weaknesses to achieve publichealth goodst. Reforms to a better performance ofthe health system will ultimately increase thepossibilities of health security and prosperity of anation. Health reform is also a complex process andit requires the courage of the government leadership,the cooperation and dedicated efforts of the publicand private personnel, and the participation of thepeople.

The guiding principles to any health reformprogram should consider the following aspects:-.Universality: covering the whole population

with a basic package of priority serviceswhere everyone in the country has the sameaccess and benefits ftom the basic health careprovided.

.Quality: improving and ensuring thestandards of care and health facilities,enhancing diagnoStic and clinicaleffectiveness, updating medical education andtraining with focus on professionalism, ethicalissues, patient satisfaction and trust withupdated medical technologies.

.Equity: financing for health services is usuallybased on ability to pay, while provision ofservices is based on needs, thus there shouldbe an efficient funding scheme which benefitsall members of the community.

.Efficiency: allocation and mobilization ofhuman, financial and inftastrocture resourcesfor health based on population needs andcost-effectiveness.

.Sustainability: ensuring continuity, selfsufficiency and lasting establishment of thehealth system reforms and services for thehealth and well-being for the present and thefuture.Many European countries have been or are

presently going through a process of reform of thehealth care sector. The impetus for such reformscomes ftom the inability to control costs, criticism ofbureaucratic rigidity, and the impression of getting

Health refonn in its aim to improve the delivery ofhealth services to the population have the followingobjectives and principles..Equity; which comprises ensuring access to

essential health services to the portions of thepopulation at financial and geographical

disadvantage

. Jabatan KesihatanPen4batan UKM

Masyarakat. Fakulti

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Jurnal Kesihatan Masyarakat 2002: Jilid 8

f. Working with the private sector (establishing

systems for regulating, contracting with, or

franchising providers in the private sector)

.

TYPES OF HEALTH REFORM ANDEXAMPLES

Quality; which incorporates the effectivenessof treatment and consumer satisfaction withhealth services providedEfficiency; which includes:-o Allocative efficiency -distribution of

resources across services so as tomaximize health benefits

o Administrative efficiency -

management structure of health arcdesigned to promote most efficiencyuse of resources

o Technical efficiency -services areprovided at the lowest possible cost

COMPONENTS OF HEALTH REFORMS

Generally there are two main types of healthreforms:-.Financing Reform

o Public drug expenditure0 Health insurance0 User charge0 Voluntary and other local financing0 Donor fmancing and drug donation0 Development loans

.Organizational reform0 Primary care strategy0 Restructuring of services0 Training of health personnelExamples of some of the types of health

reforms will be discussed below.

Health reform in drug financing

Using pharmaceutical expenditures as an example,pham1aceutical expenditures as well as overallhealth expenditures, are linked to economicdevelopment (they tend to increase as GDP

increases). However. pham1aceutical consumptionas a percentage of GDP shows much less variationamong regions than does overall health expenditure

(fable 1).Furthermore, in lower income countries,

pharmaceuticals generally account for a moresignificant share of overall health expenditures thanin established market economies (for which thisshare is about 15%). For example, in countries suchas China, Indonesia, and Thailand, this share rangesfrom 3545% [46]. In several African countries, it isbelieved to exceed 50%.

The major components of the health reform involvesthe following:-a. Impraving the performance of civil services

(reducing staff numbers, changing pay,grading and appraisal system, and reworkingjob description).

b. Decentralization (management systems/healthcare provision devolved to local governmentor other agencies closed to local populations)

c. Improving the functioning of nationalministries of health (organizationalr~cturing to improve human and financialresources management, monitoringperformance, defIning priorities and costeffectiveness interventions)

d. Broadening health financing options(introducing of user fees, community fundingmechanism, s2cial and private insurancemechanism, voilcher system)

e. Introducing managed competition (promotingcompetition between health serviceproviders/multiple purchasers)

Table I: Health and pharmaceutical expenditures by region, 1990 *

~

Health

expenditures

Region

,Health expenditures

by source (0/0 of total)

Total % Public Privateper capita GDP

(US$)

Total Private as % of total

.1 pharmaceutical pharmaceuticalexpenditures expenditures

Aid Percapita % GDP(US$)

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Jurnal Kesihatan Masyarakat 2002: Jilid 8

In developing regions, 50 to 90% of theoverall pharmaceutical expenditures are privatelyfinanced, which is considerably higher than inindustrialized countries (median is 34%)

(WHO/DAP 1997).Because drugs account for such a large

portion of health expenditures, and because thepurchase of these products often requires spendingin foreign currency, inefficiencies in drugproduction, procurement, storage, distribution, anduse can be a significant element of waste within thehealth sector.

Drug financing reforms, efforts to promoteaffordability and efficiency, and organizationalrefonns are critical elements in the overall healthsector reform process. Drug financing reformsinvolves three main aspects namely financing reform,affordability and efficiency , and organizationalrefohns.

national economic output (GNP), public spending onhealth in developing coun1ries is one-quarter to one.half that of indus1ria1ized coun1ries. Hea!thfInancing reform should improve the use of publicresources, but it should not be aimed to furtherreduce public spending on health.

The level of public commi1ment for financinghealth care and drugs should be a matter of explicitpublic policy, based on an analysis of health careneeds and fInancing options. Policy makers,managers responsible for health care fmancing, andessential drugs managers should be familiar with themethods for analyzing public financing of drugs andfor planning public expenditures for drugs.

Examples of the public drug financing areobserved in Bhutan and Indonesia as illustrated inFigure 1.

What determines public spending on healthand drugs? In practice, actual per capitaexpenditures are determined by a combination offactors including: political will; national economicoutput (GNP); the share of GNP collected in taxes'asgovernment revenue; the share of governmentspending devoted to health; the existence of publiclymanaged health insurance coverage; the share ofhealth spending devoted to recurrent operating costsversus capital development costs; and the share ofhealth spending devoted to pharmaceuticals. Figure2 illustrates several of these factors for two low-income countries, one with a high commi1ment tohealth and essential drugs spending and one withlow commi1ment.

Drug financing reforms

Health refo111l in drug financing focuses on theperspective of certain financial aspects of heald1 -

public financing, health insurance, user charges,donor financing and drug donations, and developmentloans.

PubUc financing: Some public spending willalways be needed to ensure access to drugs by thepoorest in society; to ensure proVision of drogs fortuberculosis, sexually transmitted diseases, and othercommunicable diseases; and to ensure care for targetgroups such as mothers and children. As a share of

,Bhutan.It is unusual for a developing country in that it provides most of its drugs (90%) through

the public sector..Public drug expenditure is roughly US$1 per capita annually, 70% of which is covered

directly by the central government allocations (=63% of total phannaceutical spending)and the remaining 30% is covered by multilateral and bilateral donors.

.An essential drugs list exists (326 dosage forms categorized by levels ofuse in 1995) andis used in the purehase of drugs through international tenders.

Indonesia.The public sector contributes one-quarter of the US$ 3.75 per capita whi~h is spent

annually for phannaceuticals by both public and private sources. Of this publiccontribution, two-thirds comes from central government allocations (=16.7% of totalphannaceutical spending), with the remaining contributions coming from civil servanthealth insurance schemes, provincW and district budgets, and donors .vertical prograIns.

.The central allocation for drugs is deteIn1ined each year on a per capita basis (US$ 0.50in 1990) using official population figures which set provincial and district budgets.

Districts place their orders for drugs after being notifIed, according to a schedule, of theirbudgets, and of prices for drugs on the national essential drugs list. Drugs are delivered todistrict warehouses by both public and private supply channels.

Source: WHO/DAP (998). Health reform and drugflnancing: Selected topics

Figure 1 : Role of public drug expenditures in Bhutan and Indonesia

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Jurnal Kesihatan Masyarakat 2002: Jilid 8

Low

commitment

country

uss per capitauss per capita

400.00

GNP400.00

Tax revenne

(15% GNP)100.10100.00

Health budget 5.00

(5% of rovt

~)

10.00

(IO%oCgovt

expcnditUIes)

Recan-entbealth bndget ~.Ot8.00

0.28

(S%or~boaIth budget)

1.20

(15% ofl-.nmt

beakh budget)

PubUc helllth and p1l4UM4«utic4l ~ rejI#-ct both eC#lUIllIk C#IIl/tl4ns P41141dow4l coMMitment

Figure 2: Public pharmaceutical expenditures in low and high commitment countries

Table 2. Total government expenditures and health expenditures*

Total government Health as % of total Public healthexpenditures as e;o GNP government expenditures as e;o

(mediau) expenditures GNP(median) (mean)

Established market' economies. 42~5 12.5 5.9

Middle Eastern Crescent 33.2 4.3 2.6Transitionaleconomies 55.6 4.8 3.2Latin America and Caribbean 17.1 6.7 2.9

Asia and Islands* 19.9 4.7 1.7Sub-SaharanAfrica 29.7 7.0 1.6India 17.5 1.6 1.2

China 2.1

expenditures are consistent with regional figureslisted above, but vary greatly among countries. Butwithin the health sector, the share of budget devotedto drugs also varies -from 4.5% in Chad and 5.6%in ThaiJand, to 20.0% in Vie1nam and 36.1% inZimbabwe.

The combined effects of lower nationaloutput, government spending as a share of GNP , anddecisions about public spending on health and drugs,is that per capita drug expenditures Vary greatlyamong the 11 countries. Governments in Chad,Guinea, India (Andhra Pradesh), Ma1i, and Vietnamall spend less than $0.50 per capita on dru~. SriLanka, a poor country, still manages to spendUS$I.34 on drugs.

Actual regional differences in levels of totalgovernment expenditures and public support forhealth are shown in Table 2. In the establishedmarket economies and transitional economies,central government expenditures total over 40% ofGNP , while the median for government expendituresin other regions is roughly 20% to 30% of GNP .Health generally receives less than half the share ofgovernment expenditures in developing countries(1.6% to 7%) than it does in the established market

economies (12.5%).How do differences in health and drug

fInancing appear at the national level? Data on totalpublic health and drug expenditures for 11 countriesare shown in Table 3. Total public health

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Jurnal Kesihatan Masyarakat 2002: Jilid 8

Table 3. Public health and drug expenditures for selected countries

Total public health expenditures Total public dru2 expenditures~ As % GNP Per capita (US$) As % health bud2et Per capita (US$)Bulgaria 3.9% 44.76 18.4% 8.24Zimbabwe 2.8% 12.43 36.1% 4.49Colombia 1.5% 20.03 18.0% 3.61Thailand 2.0% 33.65 5.6% 1.89Sri Lanka 1.5% 8.58 15.6% 1.34

Philippines 0.5% 4.53 13.3% 0.60Vietnam 1.1% 2.32 20.0% 0.46Guinea 0.4% 1.73 15.8% 0.27Mali 0.4% 0.74 18.8% 0.14India (Andhra Pradesh) 3.2% 1.93 6.8% 0.13Chad 0.6% 1.06 4.5% 0.05

Source: Based on data presented in WHO/DAP. (1996). Informal consultation on evolving public-private rolesin the pharmaceutical sector. Data are from the most recent year available, generally early 1990s.

Not all insurance mechanisms -be they publicor private -will cover the costs of drogs. However,several arguments can be made for including drugs.First, drugs are an essential and highly cost-effectivepart of modem health care. Second, drugs make upa large share of household expenses and theirinclusion in either a compulsory or a voluntaryinsurance scheme will make the scheme moreacceptable. Finally, effective early treatment ofacute illnesses, such as malaria and pneumonia, androutine treatment of chronic illnesses, such asdiabetes, not only improves health, but also redu(;escostly care for complications and hospitalizations.As illustrated in Figure 3, there are both benefits anddifficulties associated with various insurancemechanisms.

User charges : User charges are increasinglybeing implemented by governments and localcommunities in countries at all levels ofdevelopment, both to supplement generalgovernment revenues or insurance premiums, and tohelp control utilization. Often, however, suchprograms have not learned from past experiences,are not well managed, and, as a result, access showsno improvement, revenue replaces rather thansupplements government funding, and drugs areover prescribed.

User fees can complement governmentallocations for pharmaceuticals, but should notreplace them. Future efforts need to ensure that thelessons from existing research and actual experienceare applied to the design, implementation andmonitoring of user fee programs to ensure thataccess to drugs does improve and that rational usedoes not suffer. When fee mechanistns are institutedat a national level, a top-down approach, startingwith major national and local hospitals, may haveadvantages in terms of equity, reinforcement of thereferral system, revenue potential, administrativecapacity, and impact evaluation.

WHO has previously suggested a minimumfigure of US$ 1.00 per capita annually as anappropriate target for public expenditures for drugs(WHO/DAP 1997). However, the adequacy of thisfigure depends on several factors, including thevolume of government-fmanced health care, therange of conditions for which drugs are provided,and the availability of other financing sources suchas insurance and user fees.

Health insurance : Formal health insuranceand various informal community insurance programsrq>resent a growing source of health and drugfinancing in transitional and developing countries.The experience of many countries has shown thatcompulsory social insurance can be the critical stepto a more equitable health care system. It must berecognized, however, that some developingcountries will have difficulties in implementingwidespread insurance coverage in the short-term fora number of reasons including limited formalemployment and weak state mechanisms.

There are benefits in providingpharmaCeutical coverage together with healthcoverage although challenges, such as difficulties intracking prescriptions, exist. Policy makers andmanagers need to be fully informed about the valueof insurance coverage, alternative mechanisms forproviding pharmaceutical benefits, and methods toensure quality of care, while controlling costs.

Universal health insurance is a feature ofalmost all the health systems of developed marketeconomies (a notable exception is the United Statesof America) and appears to improve affordability ,While promoting equity and solidarity in thesesystems. In most developing countries, the situationis quite different. The region with the lowestinsurance coverage (mean) is Sub-Saharan Africa,10.3%; this is followed by Asia (excluding Chinaand India), 27.3%; Latin America, 45%; and theMiddle East Crescent, 56.7% (see Table 4).

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Jurnal Kesihatan Masyarakat 2002: Jilid 8

Table 4: Distribution of health insurance coverage by region

Population coverage for countries Country distribution of insurancewith insurance coverage

Mean Median Range With Not known or noinsurance insurance#

Regions/countries

Established market economies

Middle Eastern Crescent

Latin America and Caribbean

Asia and Islands*

Sub-Saharan Africa

India

China

98.7

56.7

45.0

27.3

10.3

100.0

50.0

35.5

10.2

8.0

86 -100

15 -100

6- 100

1- 100

1 -26.5

13

7

20

12

14

12

25

13

19

33

5.0

30.0

For the transitional economies, 7 countries have no available data, 11 countries have less than 1%insurance coverage and the Czech Republic has 100% coverage.# Coverage is less than 1%* Except China and IndiaSource: Creese A L. Kutzin.l: (1995). Lessons from cost-recovery in health. Forum on health sector reform.

Discussion paper No.2. Geneva: World Health Organization

Sodal insuranceCosta Rica: The Costa Rican Social Secwity FWld, CCSS, now provides nearly universal health insurancecoverage to the population. FWlds are derived from a variety of sources including employers, employees, theself-employed, and a contnoution from the central government CCSS coven; about 800/0 of healthexpenditures and includes in this both cw-ative and preventive cafe. Drug availability at CCSS phamJacies ishigh and drugs are provided free of charge with no co-payments. They are prescn"bed and dispensed accordingto generic name; and are almost always those fOWld in the CCSS fonnulary (535 drogs and dosagefonns)(MSH/WHO/DAP 1997, Nonnand & Weber 1994)Thailand: Roughly 72% of the Thai population receives health coverage dJrough some fonn of insunmce.Both social welfare and social security (providing coverage for 56% of the population) require the use ofessential drogs, while coverage for civil servants and volWltary private insln'ance do not About 67% of healthexpenditures are financed privately because patients prefer self-medication and treatment at private clinics,which public insurance does not cover (WHO/DAP 1996). A separate insurance system -a voluntary healthcard scheme -was created to insure those in rural areas for the fees associated with services provided by thepublic sector (WHO 1994). Use of essential drugs is mandatory with this public health card [42]. Theeffectiveness of this fonn of insurance has yet to be evaluated.

Community-based insuranceGuinea-Bissau: Pre-payment schemes have been developed in rural communities with community-managed village health posts as a means of ensuring health cafe and drug provision dwing the haJf of the yearin which no monetary economy exists. Villages decide both the rates and the methods of pre-payment Forthose individuals who contnoute, drogs and services are free of charge at the time of provision. Participation is, -

on average, over 9OOfg of those eliglole. Although there were issues ~th drug .-ng due to constraints atthe central medical store, drugs had become more available in two-thirds of the villages and, where this Was notthe case, villagers still perceived the quality of service to have improved (MSH/WHO/DAP 1997, Shaw &

Ainsworthl996)Private Insurance

Zaire: Although a n~tional insurance mechanism was not determined to be feasible, several mutualsocieties in Zaire offer some fonn of health insurance covering both rural and urban areas. Each of thesehave different characteristics, and in-depth study of four of them was undertaken to determine theiradvantages and disadvantages. The insurance plans studied provided some type of basic or essential drugscoverage although some plans covered mostly outpatient services while others covered mostlyhospitaliZations. Overall, these local insurance mechanisms resulted in improved access and a morereliable source offmancing than a system based primarily on user fees (Sanniento 1995)

Figure 3: Financing through health insurance

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Jurnal Kesihatan Masyarakat 2002: Jilid 8

In the implementation of user fees, prices areset through a combination of a market approach(willingness to pay) and a cost-based accountingmethod. There are several types of user charges,among which are:-

As with donor financing, conditions associated withdevelopment loans should not distort national drugpolicies defined by governments.

During the period the period of 1989-1995,the World Bank contributed a pharmaceuticallending which amounted to USD 1,311 million.Countries usually pay from their own resources andinterest set in this funding scheme.

Affordability and effICiency

.Cost of therapy : fIXed fee for an episode ofillness associated with standard treatment

.Prescription: standard fee per drug

.Multi-level item fee: different standard fee fordifferent drug levels

.Variable item fee: fee differs with drugdepending on type or costMost Sub-saharan African countries had some

experience with cost recovery and revolving fund inthe implementation of user charges.

Donor jinIlncing and drug donations :Donor financing includes bilateral and multilateralgrants. For some countries, internal financingmec1umiRrn~ for drugs may prove insufficient, evenafter reforms, and therefore external funding canprove invaluable to relieving .immediate humansuffering and can allow countries to develop long-term solutions.

The challenge with all external financing, butparticularly when it involves the financing of~t costs, is to not allow this to substitute forefforts by countries to develop sustainable financingmechanisms. Transitions from external mech~!1~Rffisto internal mechanisms need to be incorporated inassistance plans from their conception. But it shouldbe recognized that sustainability may requirerelatively long-tenn commitments by donors.Four core principles of dIUg'donation that should benoted are:-.Maximum benefit to the recipient.Respect for wishes and authority of the

recipient.No double standards in quality.No effective communication between donor

and recipientVoluntary and other local fInancing: Non-

governmental organizations are frequently involvesand usually playa significant role. This schemeusually involve local and external donation. One ofthe countries engaging in this scheme is Tanzaniawhere employer provided health care which arefurnishe.d through contracts with private careproviders or through insurance and reimbursement.Other then that, that is also a sick fund which willpay for the cost ofhealth services for the poorest.

Development loans: Development loansthrough the World Bank and regional developmentbanks may contribute to long-term developttlent ofthe human and physical infrastructure for the healthsector. However, loans generally should not be usedfor financing of the cost of dIUg supplies, as theserepresent recurrent expenses. There can exist certainexceptions to which may justify the use of loans forprocurement (e.g. seeding of revolving drug funds).~

The appropriate choice and use of drugs is the key tothe achievement of phannaceutical policy objectivesand should lead to a greater economic efficiency inthe health sector. A variety of cost-control measureshave been applied at various levels within public andprivate drug supply systems. The appropriateness ofdifferent measures varies with particular healthsystem in each country.

Affordability of drugs for consumers is apublic health concern. Private expenditures forphannaceuticals in developing countries typicallyaccount for SO to 90% of all spending on drugs.Even for rural populations and the urban poor, themoSt common source of drugs is direct out-of-pocketpurchaSe ftom the private market.

Use of generic drugs and price controls arethe two moSt commonly pursued mechanisms topromote affordability .Generic competition withprice information is effective in this regard. Butgeneric drug markets have grown very slowly inmost countries. The strength of public policycommitment to generic drugs is a major detenninantof the growth of generic markets. Four essentialfactors for success appear to be supportivelegislation and regulation, reliable quality assurance,professional and public acceptance, and economicincentives.

Various mechanisms exist to control producerprices and distribution margins. Wholesale anddispensing margins based on cost plus a fliedprofessional fee provide a better incentive forrational dispensing than margins based only on apercentage. The effects of phannaceutical pricecontrols have been mixed. Paradoxically, a numberof developing countries are relaxing price controlson drugs, while governments in industrializedcountries are becoming increasingly concerned withphannaceutical prices. With or without pricecontrols, price transparency should be a centralobjective.

The main strategies in order to attainaffordability and efficiency are:-.Therapeutic efficiency in drug selection and

use.Cost control measures

o Bulk purchasingo Capping of expenditure\drug selectiono Marketing and advertisement

restrictionso Prescribing controls or incentives

40

Jurnal Kesihatan Masyarakat 2002: Jilid 8

.

storage and physical distribution may be integratedunder the essential drugs program, while financing,quantification of needs, and monitoring may remainunder the management of the national control

program.Role of the ..'third sector": Public and private

roles in the phannaceutical sector should not ignorethe vital role of the "third sector." This includesNGOs' health services, not-for-profit essential drugssupply agencies, professional associations, consumergroups, and specialized NGOs such as some national

phannacological organizations.Recently some governments have explored

ways of carrying out "public" functions such asstandard-setting or quality control testing throughinnovatiye arrangements with third sectorinstitutions. Some of the "third sector organizationsthat can be involved are service deliveryorganizations, consumer o~ni2:~ons, professioiialassociations, standaid-setting organizations anduniversities. The various roles played by the thirdsector should be clearly acknowledged by policy-makers, and ways to best support and involve diesector should be explored.

o Price controlo Promotion of rational useo Use of generic productso User fee and co-paymentsAffordability for consumerso Large number of competitors, none of

which possesses a dominant marketshare

o Homogeneity of productso Perfect mobility of resources and low

barrier to entryo Widespread availability of informationGeneric drug strategyo Supportive legislation and regulationo Reliable quality assurance capacityo Professional and public acceptanceo Economic incentives

Organizational reforms

Health reform in maternal and child healthservices

Health refonn in the maternal and child healthservices involved both financing and organizationalrefonns. Among activities involved in this refonnare immunization, safe motherhood, tax relief forvaccines, oral rehydration salt (ORS), and

contraceptives supply.Immunization: Routine immunization

programs are quite cheap per dose of vaccine. Theintroduction of vaccine of new vaccines such asHepatitis B, Haemophilus influenzae Type B (HiB),and the new rotavirUs vaccines has also beendelayed in many countries, partly because of theirhigh costs. The unknown additional costs include:cold chain, service delivery costs and socialmobilization, (mfonnation, education,communication).

A survey carried out in 78 countries, indicatedthat three quarter of the countri~ have theirimmunization programs or vaccine llile items in theirnational budgets. Most of the governments paypersonnel costs and are paying more and more oftheir vaccine costs, however, few countries pay allnon-personnel costs of their immunization programs(DeRoeck et al1999, Lieghton 1999). Countries likePanama, Nicaragua, and Honduras, which pay for allor nearly all their vaccine costs, still rely on donorsto cover between 16% and 39% of their totalrecurrent non-personnel CQsts.

Safe IIWtherhood : Motherhood relatedafflictions are the biggest cause of morbidity andmortality among women between the ages of 15 and44 (reproductive age group) in developing countries.Of the 585,000 women who die worldwide from

Refonns to financing systems cannot be madewithout organizational refonns that should match thestructure of the public and private sectors to theirresponsibilities in fulfilling policy objectives.Changes may include incorporation of competitivemechanisms within the public sector,decentralization of health service provision, and a.,greater role for nongovernmental organizations(NGOs) and other non-commercial "third sector"entities.

Competitive mechanisms in public drugsupply: Alternative drug supply strategies for publicdrug supply include the traditional central medicalstores system, autopomous supply agencies, thedirect delivery system, the prime vendor system, andfully private supply. Several of these systemsinvolve different public-private roles and rely ongreater competition to improve efficiency.

The practical results of different mechanismsfor public drug supply have yet to be clearlydocumented. Governments seeking to improveefficiency in public drug supply should do so withthe knowledge that a number of options exist andthat success depends not only on choosing an~propriate option, but also on the way in which theoption is implemented.

Decentralization and integration in drugsupply systems: Control and decision-making inhealth systems is increasingly being decentralized.For drugs, decentralization may improvequantification of drug requirements, inventorycontrol, prescn'bing, and dispensing. But somedegree of centralization may still be required forfunctions such as drug registration, development ofessential drugs lists and standard treatments, qualityassurance, and bulk tendering.

Efforts are also being made in some countriesto integrate supply syStems for family planning,tub~rculosis control; and other "vertical" programsinto essential drugs programs. Resource-intensivefunctions such as procurement, quality assurance,

41

Jurna/ Kesihatan Masyarakat 2002: Ji/id 8

hnpacts of policy change were influenced byhe extent to which financing refonns were linked toone another. In Zambia for example, there wereweak links between individual resource mobilizationpolicies: cost sharing policies were implementedwithout establishing an effective exemptionmechanism for the indigent, and a mismatchbetween prepayment premium leyels and existingfee levels created perverse incentives for bypassingprimary care facilities. In South Africa, the benefitsof free care policies on utilization and equity werecompromised by slow moving implementation ofpolicies supporting primary health care. Geograpliicbarriers continued to limit the improvements inaccess resulting from the removal of financialbarriers. On the other hand organizational refonnsplaya critical role in strengthening capacity toimplement fmancing policy changes and vice versa.

Health reform in Malaysia

In Malaysia, health reform have been one of the ongoing continuous process. Various reform activitieshave taken place in order to improve equity,efficiency accessibility and appropriateness of carenamely in the public health sector. Some of thereform activities include the following:-

complications of pregnancy and childbirth each year,99% live in developing countries. Another 15million women have chronic health problems afterchildbirth, and 64 million women suffer dangerouscomplications from pregnancy. In order to improvethis situation, promotion on increased use ofmatemal health services, including safe pregnancy,care of newborns, women's nutrition, familyplanning and other key reproductive healthinterventions have been introduced (Lieghton 1999),This initiative is known as the safe motherhoodinitiative.

Activities under this initiative includegathering information about costs, financing andeffectiveness of maternal health services to helpdecision makers design and implement moreefficient and better quality maternal reproductivehealth services. The reform agenda are to identifyand remove' financial, management and policybaniers to effective financing, delivery and use ofmaternal and reproductive health services, andimproving clinical knowledge and quality of care.Focus of activities are removing barriers toproviding and using of services, costing services toimprove value, finding fmancing alternatives andbuilding local policy capacity (pHR Maternal &Reproductive Health Initiative 1998)

Tax relief for }laccines ORS andcolltr4cepti}le supplies: A number of developingcountries use tax relief for three public healthcommodities -vaccines, oral rehydration salts(ORS), and contraceptives. Tax relief can take theform of exemptions, waivers, reductions or somecontnoutions. The ultimate goal of using tax relief isto improve the health status of population byincreasing the use of public health commodities andassociated services (Lieghton 1999).

A global E..mail survey was carried out in late1997 to see whether countries granted tax exemptionfor these three commodities. Of the 44 countriesqueried 22 countries responded: Bolivia, Brazil,Cambodia, Djibouti, Dominican Republic, Eritrea,Ghana, Guatemala, Indonesia, Jordan, Kenya,Madagascar, Malawi, Morocco, Mozambique,Nicaragua, Philippines, Senegal, Tanzania, Uganda,Zambia and Zimbabwe. Of the 22 respondents, 15(68%) grant some form of tax relief (Krasovec &Connor 1998).

Family Healtho Maternal and Child Health

.Safe Motherhood. This project has leadto the introduction of alternativebirthing centers at various healthclinics to ensure safe delivery

.Universal child immunization program

.Breast and cervical cancer screening

programs.Mental and rehabilitation at primary

care level.Elderly care programs.Adolescent health care programs etc

0 Primary Care.Family medicine specialists posted in

health clinics.Alternative medicines.New types of facilities providing wider

scope of care and building up ofpaperless clinics and hospitals etc

0 Nutrition.Food basket program for children ag~d

6 years old and below and who areunderweight from hard core poorfamilies

.Baby Friendly Hospital Initiatives

.Code of ethics of infant formula tosupport the breastfeeding initiative

.Micronutrient deficiencies

.Nutrition resource center etc

Health refonn In South Africa and Zambia

In both South Africa and Zambia, health carefinancing changes occurred within the broaderprograms of health system refom1 that wereintrOduced during the 19908 to improve equity andefficiency of health care delivery. Table S outlinesthe health care financing reforms that wereconsidered in each country as well as the parallel,institutional reforms that were implemented (Gilsonet al 2000).

42

Jilrnal Kesihatan Masyarakat 2002: Jilid 8

0 Health insurance etcFood Quality Control

o Food safety

o Food enforcement etc Health Planning and Developmento Upgrading of health care facilitieso Existence of more private health care

facilitieso Upgrading of skills of health personnelo Review of fees acto Introduction of specialized services etc

Since its independence, Malaysia haveundergone various levels of reform in order toimprove the health of the nation. More neweractivities are being studied in line with the currentand future requirements.

Disease Controlo Management of emerging of newly infectious

diseases0 Remerging of old diseases such as

tuberculosis0 Establishment ofPublic Health laboratory0 Management of non communicable diseases

etc.

Health Promotion

o Healthy lifestyle campaign

ISSUESNational Health Management Institute

QualIty Programso Quality assurance program.

o Quality control

o Quality Control circleo MS ISO 9000o Innovations in healtho Health technology assessment etc

There are various issues that need to be looked intoand addressed in making decisions with regards tohealth reform. Among the issues are as follows:-o Balancing the interest of various population,

income, commercial values, and healthprovider groups

0 Financial sustainabilityo Cost effectiveness allocation of public health

resources and financing alternatives for thepublic sector services conflict with orcompromise their traditional equity goals

0 Faces of equity in health sector

Health Financingo Purchasing of serviceso CoIporatization and privatization

Table 5: Reforms of focus in South Africa and Zambia

Type of reforms Spedfic reforms~ South Africa (1994-1999) Zambia (1991-1999)

Resource Mobilii.ation .Removal of user fees for pregnant. Introduction/expansion of userand nursing women and children feesunder six and for primary care. .Development of exemption

.Res1IUcturing of public hospital fees policy

.Development of proposals for social .Introduction of prepaymenthealth insurance scheme

Resource allocation. Development and implemehtation of. Development andinter-provincial resource allocation implementation of inter-districtformulae resources allocation formulae

.Budget reform to reallocate resources. Budgetary decentralization tobetween levels of care district and hospital boards

.Budget reform throughoutgovernment leading to globalbudget for provinces.

Parallel, Institutional. Creation of provinces within a semi- .Creation of the Central Board ofreforms federal state Health (CBOH) as

.Proposals to strengthen public implementation arm of thehospital management Ministry of Health.

.Development of district health .Increased autonomy to publicsystem referral hospitals and the

establishment of hospital boards.Strengthening ofdte district

health system with formalautonomous boards

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Jumal Kesihatan Masyarakat 2002: Jilid8

CONCLUSION

There are various options c that can be chosen toimprove health services delivery .One must bear inmind that one need to sacrifice something in order toobtain another. It is important to be able to balancethe necessity and actual requirements, and get theoptimum benefit from any health reform activitiescarried out.

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