Policy Perspectives of SDC for Improving Access through Health Financing

Health financing is increasingly important

Von Debora Kern / Direktion für Entwicklung und Zusammenarbeit DEZA

SDC considers Health financing as one component which gains in importance within the health systems in its partner countries. Why?

There are different reasons, why SDC considers health financing as an issue, which gets more and more important. First of all, health costs are increasing – not only in high income countries but as well in low and middle income countries. There are different reasons, the most important is the double burden of diseases (communicable and non communicable diseases), the increasing prices of pharmaceuticals (including vaccines) and medical technologies, but as well a higher demand of services due to population dynamics (growth and urbanization).

While the donor share is quite essential in covering the costs of communicable diseases, there are less foreign funds at disposal for the mid and long term commitment of the non communicable diseases. This leads to an increasing funding gap – now and in the future.

Predictability and volatility of funds are – beside international commitments in Paris/Accra – still an issue in recipient countries and contribute to the difficulty in planning health funds in a mid/long term perspective. The share allocated to the health sector remains below the promises made in Abuja (15% of the overall state budget). At the same time there are limited capacities for the absorption of funds in the health sector (strongly linked to the Human Resources for Health crisis in many Middle and Low Income Countries), limited efficiency in use of funds and management constraints and lack of analysis and planning capacities.

But the health financing issues are as well a challenge on the health service consumer side: Most countries have unfair, regressive systems in place in terms of cost sharing. For too many people accessing health services means a financial catastrophe.

All these listed challenges show the need for support in this field and we are very glad about the World Health Report 2010 on the same topic.

SDC Policy Perspectives in Health Financing

The overall goal of SDC’s cooperation is to improve the health status of the poor and vulnerable population in order to enhance their livelihood and well-being. The focus of SDC’s engagement is to strengthen health systems in order to deliver accessible services in a sustainable way. Strengthening health systems entails addressing key constraints related to health worker staffing, management, infrastructure, health commodities such as equipment and medicines, logistics, tracking progress and effective financing. Processes of health sector reforms are supported where necessary and relevant.

SDC is convinced that there is a high interlinkage of demand and supply side and thus therefore necessary to foster both sides; this means on the supply side to expand access to quality essential care, on demand side to ensure community participation and empower the service users.

Swiss Engagement in Health Financing

What is Switzerland doing in improving the health financing system in our partner countries?

First of all, Switzerland is providing funds – be it through Switzerland’s multilateral contributions, membership in international initiatives and bilateral development assistance.

SDC is advocating on international and national level in policy dialogue for increasing funds for the health sector and in reminding the partner countries on the Abuja targets. SDC is providing technical assistance and capacity development on different levels of the health system and is supporting researches and analysis on processes and outcomes for learning and feeding it back to policy. National Health Accounts, Public Expenditure Reviews or studies on equity in accessing health care are examples. To enhance equity is as well the driving force in our endeavors in the policy dialogue. In Tanzania, for example, we’ve achieved, that equity became a transversal issue in the current health sector strategic plan and where an allocation formula – based on equity indicators- has been created for the budget allocations to districts.

On demand side, SDC is empowering the service users through health promotion – applied in its broad understanding of the Ottawa Charta – and through a rights based approach. We contribute therefore to a higher demand on social accountability – a mechanism which should lead to improved governance, and finally quality services.

SDC policy perspectives in Social Health Protection

Since the eighties, hot debates on pro or cons on user fees, exemption, tax based systems, free care or all sort of health insurances appear periodically on the political agenda. SDC has mandated many background papers and analysis for a position in this debate during the last decades – with always the same outcome: There is no blueprint, no one cap fits all policy on health financing and social health protection models, even though some of our colleagues do think there is. Solutions need to be adapted to the context, always with equity as the central element. Universal coverage or equal access to affordable quality health care should be the centre of our work. This is even more important in times and settings where resources are scarce. The vulnerable and poor are the most exposed at risk of catastrophic expenditures, leading them into poverty or even the denial of their right accessing essential services. In Mozambique for example there are no user fees in public facilities; however inofficial payments are for many poor people a barrier accessing essential services. For others – who live in settings where only private (mainly faith-based) facilities are offering services – the user fees are too high?

The choice to share out the health care costs among the population (tax based system, social or private or community based insurances) belongs of course to the partner countries of SDC. However SDC’s mandate is to make sure and advocate that equity in access to quality care is guaranteed.

SDC is working on different levels: On multilateral level, through Switzerland’s membership of World Health Organization and World Bank, SDC tries to promote the agenda of social health protection. SDC also joined last year the Providing for Health (P4H) network to foster sustainable health financing systems and social health protection frameworks. SDC has already been a member of the previous network the so called GTZ-ILO-WHO consortium on social protection and is working in many countries on this issue. The P4H network allows us now a coherence of our local engagement and international commitment and creates synergies of our bilateral and multilateral cooperation.

SDC has long standing experiences in health financing and social health protection mechanism in different countries. Currently we are working in Benin, Chad, Tanzania, Rwanda, Burundi, Kyrgyzstan and Tajikistan in this field. Most of the projects or programmes will be presented in the afternoon of the conference, that’s why I point out only some general lessons learned for us which are common even though the context varies widely:

- The empowerment of service users is crucial. A recent assessment on our support in Benin has shown that the community based health insurances (CBHI) which have been established since 1995 with the Swiss support have an important positive impact on the empowerment of the service users. Empowered service users and members of CBHI’s do know their rights, they dare to demand a certain standard and do enhance accountability within the health sector and beyond.

- Quality of care is the essential factor of re-enrollment. In Tanzania for instance the voluntary enrollment of the community health funds (CHF) is extremely low even though the annual contribution is not high for households. The hindering factor for the population is the low quality of care.

- Too poor to pay: How to identify the poor? Whereas the World Health Report is quite clear on the fact that public spending is needed to pay for the poor in all settings, the question on identification remains unsolved. Who is too poor in countries where the majority lives under the poverty line? Who is defining who is too poor? How to avoid discrimination?

- Equitable mobilization of funds: This issue is strongly linked to the previous one. In most of the low income countries an equitable mobilization is quite difficult to introduce. Beside the technical difficulties such as missing registries, the political will is often lacking to increase the contribution of the middle and high income quintile.

- Involve the demand and supply side from the beginning: SDC has tested many innovations on community level with success. The importance of fostering both sides and creating the critical interface between demand and supply side is key. Only if the population does participate and the services are improved a successful partnership is possible. It is further important to work on different levels on supply side in order to bring the experiences of the community level back to policy level for adjustments.

*Debora Kern is Health Policy Advisor of the Swiss Agency for Development and Cooperation (SDC), which is part of the Federal Department of Foreign Affairs. SDC invests yearly more than CHF 100 mio in health programmes on different levels; multi- and bilateral programmes, projects and NGO contributions. Debora Kern has a Master in Social Anthropology (University of Zurich) and a Master of Advanced Studies in Development and Cooperation (NADEL, ETHZ) and worked in Mali, Madagascar and Tanzania. Contact: debora.kern@deza.admin.ch