Public Financial Management and Health Financing

Transcription

1 Public Financial Management and Health Financing Joe Kutzin, WHO Sharing and Debating Country Experiences on Health Financing Reform Health Financing Technical Network Meeting 14 December 2016, Geneva, Switzerland

2 Guiding principles for health financing reform to move towards UHC Move toward predominant reliance on compulsory (i.e. public) sources of funds Reduce fragmentation in pooling to enhance redistributive capacity and reduce duplications Towards more strategic purchasing to sustain progress by matching budgets to priority health services and populations to drive efficiency gains

3 Implications: the path to UHC runs through PFM, especially in LMIC contexts Coverage as a right Foundation for UHC Towards compulsory sources What the evidence tells us General gov t budget is main source Context of informality Strategic purchasing Efficiency key to sustaining progress Align PFM & HF to sustain progress Flexibility and new forms of accountability 3

4 Aim is to institutionalize and sustain progress in domestic health systems Frustration with many years of tinkering at the margins with health financing reforms SHI for formal sector, CBHI, RBF programs, mostly operating outside core budgetary processes In relatively few places have we seen serious, institutionalized and sustained system change rather than merely interesting pilots 4

5 Priorities for a serious agenda on health financing reform Managing health expenditure effectively is as important as raising new revenues (if not more) to move towards UHC Build capacity for national health authorities to engage more effectively with national budgetary authorities Evidence-based health financing strategies that incorporate fiscal realities are needed to move towards UHC Improved alignment between PFM and health financing functions is needed to ensure public funds are used efficiently to institutionalize reforms and sustain progress towards UHC 5

6 PFM and HF: different roles but shared vision PFM System Budget Formulation Budget Execution Budget Monitoring and Reporting Efficiency Equity Service Delivery Accountability Health Financing Arrangements Generation of Health Revenue Pooling of Health Funds Purchasing of Health Services Source: WHO and R4D: Toward fiscally sustainable universal health coverage: Aligning public financial management and health financing, forthcoming

7 Why management of public expenditure matters for UHC? Strong general PFM systems are critical for HF reform implementation: More predictable allocations Reduced fragmentation in funding flows/revenue streams Optimized, timely execution Better financial accountability and transparency Ongoing, long-term general PFM reforms have implications for health: Introduction/consolidation of multi-year budgeting and planning Transition toward program budgets Integrated financial management system Consolidation of information/reporting/accounting systems. 7

8 PFM and HF reforms can reinforce each other Line-item budgets are problematic for health: budgeting by inputs (staff, facilities, etc.) does not allow budgets/ spending to be matched to health service priorities Example of strict line-item budget for health SECTOR BUDGET SUB-CATEGORY ALLOCATION EXECUTION Step-by-step implementation of program budget reform can support transition toward output-oriented approach and payment systems in the health sector Evidence remains limited, though, on the actual effects of different/ alternative budget structures on effectiveness of health spending HEALTH STAFF GOODS AND MATERIAL SERVICES TRANSFERS EQUIPMENTS CONSTRUCTION AND REHABILITATION

9 Country example: DRC Health as a pilot sector for general PFM reform Health MTEF to improve predictability in the resource envelope Attempts to formulate budget according to health priority policies (PHC, MCH, vaccines, nutrition) Capacity development to guarantee transfer of spending authority from treasury to MoH Simplification of the procurement system, including for health commodities Strengthening of PFM information/reporting/auditing system to allow funding agencies use a single, integrated, national PFM platform Institutionalization of PBF as an instrument to purchase benefit package of PHC services. Source: PFM in health in the DRC: A joint bottleneck assessment, World Bank and WHO (ongoing)

10 or misalign Fiscal decentralization can constrain ability to pool public funds from different sources, including in the health sector Limited autonomy of managers/providers over resources can be a core concern for health, create unnecessary rigidities, and results in misallocations and under-execution Unfinished transition toward program budgeting, or mixed budget structure, constrains effective implementation of output-based provider payment Better understanding of the sources of major misalignments is useful for both communities 10

11 Strengthening health and budget dialogue is a priority for UHC What can be done? Example on budgeting practice How to facilitate and structure dialogue? Shared information on multiyear policy goals (MoH) and revenue forecasts (MoF) Improved quality of health budget proposals, more aligned with sector priorities (MoH) Better understanding of budgeting processes, timeline, requirements (MoH) Adjusted budget structure to match funds and needs (MoF). WHO, OECD and R4D: Process Guide

12 Key questions To what extent are PFM in health issues on the agenda at country agenda? Has program budgeting been helpful for the health sector? Has multi-year budgeting supported better alignment between planning and budgeting in health? What can the health sector do by itself? How to identify key priorities to guide and inform future health and finance dialogue for stronger PFM in health? How to institutionalize dialogue between health and finance dialogue? 12