The Montenegro Health System Improvement Project. Tehnical Assistance in the Design and Production of the National Health Accounts in Montenegro

Transcription

1 The Montenegro Health System Improvement Project Tehnical Assistance in the Design and Production of the National Health Accounts in Montenegro FINAL REPORT ON THE NATIONAL HEALTH ACCOUNTS IN MONTENEGRO Eva Zver, Stane Marn December 2008

2 CONTENTS SUMMARY 5 1. INTRODUCTION The Project s Background and Objectives An Outline of the Project s Activities and Outcomes 7 2. THE MONTENEGRIN HEALTH CARE SYSTEM THE NATIONAL HEALTH ACCOUNTS AS A POLICY TOOL BASIC INFORMATION ON THE SYSTEM OF HEALTH ACCOUNTS METHODOLOGY The SHA as a Core Element in the Eurostat s Public Health Statistics Basic Elements of the SHA Methodology and the Requirements of Joint Questionnaire Building the accounts THE DEVELOPMENT OF THE NATIONAL HEALTH ACCOUNTS FOR MONTENEGRO Institutional Framework Key Institutions Steering Committee Key Databases at Financial Agents and Providers Methodological Information The Approach in General Data Sources, Estimation Techniques and Adjustments Used The Main Departures from the ICHA s Classification Conclusions and Recommendations on Methodology HEALTH EXPENDITURE IN MONTENEGRO Total Health Expenditure by Financing Agents Total Health Expenditure by Functions and Mode of Production Current Health Expenditure by Providers Main findings on health expenditure in Montenegro: CONCLUSIONS AND RECOMMENDATIONS FOR FURTHER WORK ON THE NHA IN MONTENEGRO Towards the Institutionalization of the NHA in Montenegro Key Challenges for the NHA in Montenegro in the Following Year 48 ANNEX 1: CURRENT STATE OF NHA IMPLEMENTATION 51 ANNEX 2: Cross-classified NHA Tables (HCXHF, HPXHF and HCXHP) for Montenegro, years 2004, 2005 and

3 Table of figures Figure 1: Main areas of Public Health Statistics at Eurostat 12 Figure 2: The process of NHA implementation 16 Figure 3: Implementation phase of the NHA project in Montenegro 24 Figure 4: Total health expenditure by financing agents comparison with some countries in the region and some EU countries, Figure 5: The shares of total health expenditure by financing agents in Montenegro, Figure 6: Private expenditure as a share of total health expenditure, Figure 7: The shares of total health expenditure by functions of health care in Montenegro, Figure 7a: The shares of total public and private health expenditure by functions of health care in Montenegro, Figure 8: Total health expenditure by functions of health care in Montenegro -comparison with some countries in the region and some EU countries, Figure 9: Expenditures on medical goods, % in total health expenditures comparison with some countries in the region and some EU countries, Figure 11: Financing sources of health care functions in Montenegro, Figure 12: Public share of expenditure on in-patient care services comparison with some EU countries, Figure 13: Private share of expenditure on medical services comparison with some countries in the region and some EU countries, Figure 14: Private share of expenditure on out-patient care services comparison with some EU countries, 2006 _ 42 Figure 15: Total current health expenditure by providers of health care in Montenegro, Figure 16: The share of expenditure for hospitals in total current health expenditure comparison with some countries in the region and some EU countries, Figure 17: Total current public and private health expenditure by providers of health care in Montenegro, Figure 18: Financing sources of health care providers in Montenegro, Table of tables Table 1: Data sources relating to sources of funding 20 Table 2: Data sources relating to providers 21 Table 3: Data sources by financing agents used for the first compilation of the Montenegro NHA 25 Table 4: General macroeconomic figures for Montenegro, Table 5: Total, public and private health expenditure in Montenegro, Table 6: Health expenditure in Montenegro in relation to GDP and per capita, Tabele 7: Total Health Expenditure - comparison with some countries in the region 35 Tables 8-9: Total health expenditure by functions of health care in Montenegro, in 1000 EUR 37 Tables 9: Total health expenditure by functions of health care in Montenegro, the shares in THE, % 37 Table 10: Total current health expenditure by providers of health care in Montenegro, in 1000 EUR 42 Table 11: Total current health expenditure by providers of health care in Montenegro, the shares in TCHE in % 42 3

4 ABBREVIATIONS BIH COFOG COICOP ESA ESSPROS EUROSTAT FYRM GDP HBS HC HF HIF HP ICHA LSMS MOHLSW MONSTAT NHA NHS OECD OOPS PPP SHA SNA UNECE THE TCHE WHO Bosnia and Hercegovina Classification of the functions of the Government Classification of Individual Consumption by Purpose European System of Accounts European System of Social Protection Statistics Statistical Office of the European Communities The Former Yugoslav Republic of Macedonia Gross Domestic Product Household Budget Survey Health Care Functions Classification Health Funding Classification Health Insurance Fund Health Providers Classification International Classification for Health Accounts Living Standard Measurement Survey Ministry of Health, Labor and Social Welfare Montenegro Statistical Office National Health Accounts National Health Survey Organization of Economic Cooperation and Development Out-of-Pocket Spending Purchasing Power Parity The System of Health Accounts The System of National Accounts United Nations Economic Commission for Europe Total Health Expenditure Total Current Health Expenditures The World Health Organization 4

5 SUMMARY Health policy-makers and analysts need proper statistics and internationally comparable data on health care financing and expenditures. Therefore, in 2000 the Organization for Economic Cooperation and Development (OECD) published a manual for compiling the System of Health Accounts (SHA), which was adopted and enhanced by the World Health Organization (WHO) and Eurostat as a statistical standard. The first National Health Accounts (NHA) for Montenegro, together with the methodological information introduced in this report, are certainly the most comprehensive picture of health expenditures statistics in Montenegro to date. The NHA project team considers that the two basic NHA tables could be officially published as general NHA figures for Montenegro. Nevertheless, the ongoing compilation of the NHA will be important for improvements in the databases and in the NHA s results. For this reason, the institutional framework for future work on the NHA in Montenegro has to be established, including the introduction of a NHA coordinator and the formulation of a regulation that will support the compilation of the NHA in Montenegro on a regular basis. General figures of the first NHA study for Montenegro show that total health expenditures (THE) as a share of GDP accounted for 7.5 % in 2006 (8.0 % 2005 and 8.2 % in 2004). The public share of total health expenditures amounted to 74.8 % in The private share of total health care expenditures increased in the period from 23.6 % of total health care expenditure to 25.2 % respectively. The level of total health expenditure per capita in 2006 amounted to US$ 727 in PPP. Expenditure on medical goods is high (24 % of THE), and out of this an extremely high share (62 %) is funded by households out-of-pocket payments. Besides an internationally comparable general picture of aggregate health spending, the importance of the NHA study for Montenegro is also the breakdown of total health expenditures according to health care functions and health care providers, which enables a detailed analysis for specific health policy purposes. 5

6 1. INTRODUCTION 1.1 The Project s Background and Objectives The activities of designing and producing the National Health Accounts in Montenegro were a part of the wider Montenegro Health System Improvement Project, financed by the International Development Association (IDA) and co-financed by Canadian International Development Association (CIDA). The overall objective of the Montenegro Health System Improvement Project was to put in place the first phase of steps toward reform of the health system in the Republic of Montenegro, giving priority to increasing the capacity of policy, planning and regulation; stabilizing health financing and improving primary health care service delivery. One of the three main components of the Project is the Support for Health Reform Programme, and within this component the specific objective is to support improvements in the financial sustainability of the health care system by strengthening institutional capacity and information systems for policy, planning, regulation and management in the Ministry of Health (MOH), the Health Insurance Fund (HIF) and the Institute of Public Health (IPH). In Montenegro there are currently no official national health expenditure statistics. The only information available regards the overall revenues and expenditures of the Health Insurance Fund since Detailed data from the HIF has existed since There is a huge lack of information about private health spending. For this reason, the development of international standards for describing the magnitude and channels of health spending in Montenegro is crucial for monitoring the health system and informed decision making. Health policy makers need reliable information on the sources and uses of funds for health that is comparable across countries in order to make policy decisions that would enhance the health system s performance and make the health system financially sustainable. Therefore, the Ministry of Health, Labour and Social Welfare decided to produce a National Health Accounts known as a toll that is specifically designed to inform the health policy process, including policy design and implementation, policy dialogue and the monitoring and evaluation of health care interventions. The main objective of the project was to prepare the first estimates of health expenditures for Montenegro according to the SHA s methodology by following basic definitions about the boundary of health care and to make an important exercise towards the full institutionalization of the NHA in the future. The NHA project team focused on the compilation of the three basic NHA tables 1 (see 5.2. Methodological Information). 1 Table HP x HF (Current expenditure on health by providers and by financing agents), Table HC x HF (Total expenditure on health by functions of care and by financing agents) and Table HC x HP (Total expenditure on health by functions of care and by providers). 6

7 The main reasons behind initiating the implementation of the NHA in Montenegro were: - To improve national reporting on health expenditure; - To develop a toll for describing and analyzing health spending; - To monitor factors of growth in health spending; - To provide a toll to monitor effects of health care reform; - To meet data requirements for projecting health care expenditure; - To prepare internationally comparable data on health expenditure; - To report official and reliable health expenditure data to international organizations (the World Bank, the WHO, the OECD and Eurostat). 1.2 An Outline of the Project s Activities and Outcomes Within the Technical Assistance in the Design and Production of the National Health Accounts in Montenegro project, one international consultant and four local experts were engaged for a period of 18 months. Local members of the NHA working team came from the Health Insurance Fund, the Statistical Office (Monstat) and the Public Health Institute. The team worked in close collaboration with other experts from their institutions. Project activities and outcomes were divided in four stages: 1. Preliminary Steps The first part of the project focused on the identification and description of the current situation in Montenegro with regard to health expenditure statistics and the possibilities to develop a NHA. In general, it was pointed out that available data sources enabled the development of the NHA. The international expert proposed a detailed work plan based on an assessment of the situation for developing and implementing the three basic NHA tables. 2. Design Phase The document called The conceptual and institutional framework for the compilation of the NHA in Montenegro was prepared by the international consultant in collaboration with local experts. The conceptual framework included an assessment of available data sources and proposed a roadmap for explicit SHA implementation in Montenegro (the general approach, the structure of the NHA tables, expected problems and departures from the methodology and a detailed data plan). With the institutional framework the tasks of the members of the working group were clearly defined; it was decided that the Health Insurance Fund would assume responsibility as a housing institution for the NHA and the structure of the Steering Committee was suggested. The first workshop was organized in December 2007 to discuss the proposed conceptual and institutional framework and to familiarize experts from counterpart institutions with the System of Health Accounts methodology and implementation process. The workshop 7

8 was followed by meetings of the international consultant and local experts with experts from all counterpart institutions in Montenegro to discuss their databases and to collect all necessary documents, background information and available data sources (see Expert s Intermediate Report No. 1). The international consultant assisted local experts in compiling the conversion table between the classification used by Health Insurance Fund and the ICHA-HC classification. Accordingly, the international consultant provided training in the classification of specific health expenditures according to providers and functions and the insertion of data into the HP x HF and HC x HF tables. A major problem pointed out for the NHA s implementation in Montenegro was a lack of information about out-of-pocket health expenditures and private health providers. Therefore, the international consultant proposed questions for a special survey on household health expenditures to collect additional information on private health expenditures for the purpose of the NHA s implementation. Questions were included in a special Living Standards Measurement Survey (LSMS)-type National Health Survey, which was also organized and financed as a part of the Montenegro Health System Improvement Project. 3. Implementation Phase In January 2008, data collection began for the years 2004, 2005 and The source of funding approach was used as the primary approach. Local experts worked on the collection and harmonization of data and on entering data into the NHA tables (HC x HF and HP x HF) step by step with data collected from different sources of funding (starting with the central government, continuing with HIF s data etc.). Special data processing at the HIF for the purpose of the NHA s implementation was completed by the end of January. To assist the local experts, the second 8-day visit of the international consultant was organized in March The entry of data into the NHA tables for the year 2006 was performed under the supervision of the international consultant with data from the Ministry of Health, the Ministry of Internal Affairs, the Public Health Institute and the Health Insurance Fund. In addition, the international consultant assisted in resolving divergences, continued with data investigation and recommended methods for estimating missing data (see Expert s Intermediate Report No. 2). From March to May 2008, local experts continued to work on the completion of the NHA tables for the years 2004 and The NHA tables for the year 2006 served as a prototype. Besides this, the local experts collected further information about problematic and missing data (from local government, private expenditures, international aid and nonprofit institutions). In May 2008, the third 8-day visit of the international consultant was organized to work on the final version of the NHA tables for the years In addition, the table HC 8

9 x HP was also compiled on the basis of the tables HF x HC and HF x HP (see Expert s Intermediate Report No. 3). The results of the special Living Standard Measurement Survey (LSMS)-type National Health Survey were expected in late autumn 2008 to able to upgrade the estimations for household health expenditures. The Steering Committee for the development of the NHA in Montenegro was established in May High-level representatives from the stakeholder institutions were appointed. 4. Delivery Phase According to the data plan, the submission of the final report and the final workshop were planned for the end of November Although the NHA team had to wait for the results of the National Health Survey until the end of December in order to settle estimates on household expenditures. The final workshop will be organized in January 2009 to present the final report and the results of the NHA project to stakeholders and health policy makers, and to offer further advice on how to continue the work on the NHA on a regular basis. 9

10 2. THE MONTENEGRIN HEALTH CARE SYSTEM For the implementation of the NHA, it is very important to understand the health care system under examination and its financial flows. Three strategic documents were published by the Ministry of Health in recent years: The Strategy for Health Care Development in Montenegro (2003), The Master plan of the Development Health System in Montenegro in the Period (2005) and the Strategic Health Insurance Development Plan to These documents include a clear explanation of the organizational structure and financing of the health care system, therefore here only basic information will be presented. The health care system in Montenegro is based predominantly in the public sector. Public health care institutions are organized through a network of primary, secondary and tertiary health care, which consists of eighteen medical centres, seven general hospitals, three special hospitals, the Clinical Centre of Montenegro, the Institute for Health and the Pharmaceutical Institute of Montenegro. The private sector, which is currently not integrated in the health care system, consists of a larger number of medical centres, dental centres, wholesale medicines and pharmacies. Existing health care resources within the framework of the public sector indicate that the accessibility and development of health care infrastructure, especially with regard to the number of beds and number of doctors, is at the same level as more developed countries. (The Strategy for Health Care Development, 2003) Financing health care in Montenegro is founded on the dominant role of the public sector to provide and ensure resources for health care and services. Namely, it is based on the method of compulsory health insurance (German Bismarck method). Contributions are paid according to employees gross earnings, according to present legal regulations in the amount of 15 % of employees earnings (proportional to a ratio of 50:50 employee and employer), as well as the self-employed. Transfers from the Ministry of Health are meant to finance some capital investment, training and public health programmes, as well as cover health care provision for the uninsured including the unemployed and refugees. Patients are required to make official co-payments to access health services. However, there is also a problem with patients having to make unofficial or informal payments in order to receive health care. The main weaknesses of the financing system include the problems of inadequate revenues arising from contribution waivers, the difficulty of collecting contributions from small businesses, farmers and the informal sector, and a lack of adequate budget transfers for the uninsured, including refugees and Internally Displaced Persons (IDPs). In addition, there has been a failure to adjust the generous benefits package and capacity to reduced economic circumstances. 10

11 In Montenegro, the lack of a national medicines policy, as well as irrationality in view of the procurement, prescription and consumption of medicines, effectuates the pronouncement that regulations should regulate pharmaceutical work. 3. THE NATIONAL HEALTH ACCOUNTS AS A POLICY TOOL The Montenegrin health sector is in the process of undergoing health reform. By adopting the Health policy in the Republic of Montenegro until 2020 in January 2001, Montenegro has joined a unique international process implementing papers of the World Health Organization s 'Health for all in XXI Century' and '21 objectives for the 21st Century'. The Ministry of Health and the Health Insurance Fund are coordinating and managing health sector reforms with support from the World Bank, the World Health Organization, CIDA and other donors, to address key systemic and operational health sector issues. The general objectives are (The Master plan..., 2005): Developing a health policy that will guide citizens to become aware of their own decisions and responsibility to health and the consequences thereof; Improving health care in the most acceptable and equal manner; Developing a health care system harmonized with European health care development trends; Increasing the efficiency of the health care system through rational and accessible resources; Improving the quality of services; Applying modern health care technology; Creating a financially stable system. The Ministry of Health and the Health Insurance Fund shall, by using instruments of health policy, provide conditions for: 1) Strengthening primary health care; 2) Providing sources of financing and development of a new health insurance system; 3) Advancing the payment system for health services and programmes through a system of contract services based on capitation, budgeting and other payment methods; 4) Developing the health information system; 5) Guaranteeing patients rights; 6) Regulating national medicine policy. To undertake the above policy reforms, comprehensive and reliable macro health system information is required about the composition of the health system, who is the key actors in the system, what is their relationship with each other and what are the key financing sources, agents and utilization of national health funds. The National Health Accounts are designed to give such a comprehensive description of resource flows in health care systems. The NHA study in Montenegro represents a fundamental tool to assist policy analysts and decision-makers in tracing the source and amount of resources spent, by whom, for what and who received the payments. Tracing this flow of funds is crucial for both understanding how the current system is functioning, informed decision-making regarding appropriate policies for change, monitoring the 11

12 effects of economic and behavioural incentives and evaluating the extent to which desired goals are being achieved. As a macroeconomic policy device, the NHA can assist the Ministry of Health and the Health Insurance Fund in obtaining a picture of the size, structure and relative efficiency of the health care sector. It allows health policy-makers to identify areas within the health system that may be operating less or more efficiently than others and to assist in evaluating the impact of national and health sector policies over a period of time. Up until now, information on health resources, expenditures and the distribution of expenditure in Montenegro has been limited to the public health sector. Health expenditure information previously reported thus reflected mainly public health expenditure and some guesstimates on private health spending. This NHA round includes, as much as it was possible to obtain, health resource information from all the main sources and its distribution (see Section 5.). 4. BASIC INFORMATION ON THE SYSTEM OF HEALTH ACCOUNTS METHODOLOGY 4.1. The SHA as a Core Element in the Eurostat s Public Health Statistics Eurostat's work in the area of Public Health Statistics is structured according to four main Topics. One of them is Health Care Statistics (CARE) with two main areas: non-expenditure data collection and health care expenditure data collection. (see Figure below). Figure 1: Main areas of Public Health Statistics at Eurostat Public Health Statistics 1. Causes of Death Statistics (COD) 2. Health Care Statistics (CARE) 3. Health Interview Surveys (HIS) 4. Diagnosisspecific morbidity statistics (MORB) Health Care: expenditure data based on the System of Health Accounts (SHA) Health Care: non-expenditure data -Manpower -Hospital statistics 12

13 Health care expenditure data collection by Eurostat started recently, based on the System of Health Accounts (SHA) methodology which was developed by OECD in close cooperation with WHO and Eurostat (SHA Manual, OECD, 2000). Since 2005 the three international organizations intensified their collaborative actions through a joint data collection (Joint Questionnaire 2006, 2007, 2008). The Joint Questionnaire is reducing the burden of enquiry of the data producers, as data are only supplied once to all international organizations of which the country is a member. The aim of joint data collection is to supply a consistent and comparable picture of health care system expenditure of countries. The first round of data collection according to the Joint Questionnaire was carried out during Since December 2007 data for the years are available in the Eurostat Queen Tree Database, OECD Health Data and WHOSIS Database. Today the SHA is perceived as a core element in the system of statistical data collection of Eurostat in the area of public health, to which all relevant socio-economic data collections (e.g. manpower, hospital statistics, socio-economic status) will be linked in the future. The common effort from Eurostat, OECD and WHO in the area of health expenditure statistics will serve as a platform for harmonizing institutional approaches and enhancing further SHA development. In the near future the SHA manual and related classifications will be subject to a revision process, led by Eurostat, OECD and WHO, in co-operation with national experts in the field. This revision process aims at providing a more coherent health accounting system better suited for policy use as well as better linking to the System of National Accounts. The implementation of SHA requires political commitment, clear institutional responsibility, and cooperation on the national level between institutions with relevant data sources. Nearly all EU Member States and OECD countries have implemented the SHA framework. Many WHO Member States have also implemented a health accounting standards (many of them following the Guide to producing national health accounts with however, special applications for lower and middle-income countries), and many others are initiating the process. Documentation Contact person (for health expenditure data) at Eurostat is: Cor van Mosseveld (Cornelis.van- Mosseveld@ec.europa.eu) Various methodological reports and documents related to data collections are publicly available in a web-board called CIRCA (Communication & Information Resource Centre Administrator), available at CIRCA contains a dedicated section for Public Health Statistics and one for Health and Safety at work. For all areas of Public Health Statistics important methodological documents can be found at in the folder 'Methodologies and data collections'. For example for Health accounts: the SHA manual and guidelines for implementation. 13

14 Key documents on the SHA methodology could be found on: Eurostat: OECD: WHO: The SHA health expenditure data collected are available at: Eurostat Queen Tree: (access is free) OECD Health Data: WHO Database: Basic Elements of the SHA Methodology and the Requirements of Joint Questionnaire The System of Health Accounts (SHA) proposes an integrated system of comprehensive and internationally comparable accounts and provides a uniform framework of basic accounting rules and a set of standard tables for reporting health expenditure data. Compilers of the National Health Accounts should follow the methodology described in the original manual The System of Health Accounts, Version 1.0 from the year and the additional methodology to this manual developed in the years and explained in the Joint Questionnaire 2006, 2007 and The SHA methodology makes sure that a clear separation is made between the financial, institutional and functional aspects of health care by proposing a tri-axial system of recording which answers three key questions: - Where does the money come from? (from financing agent) - Where does the money go? (to provider of health care services and goods) - What kind of (functionally-defined) services are performed and what types of goods are purchased? These questions are addressed respectively in the proposed International Classification for Health Accounts (ICHA) which breaks down into three basic classifications 3 (see Annex 1): 1. Health care financing agents (ICHA-HF) 2. Health care functions (ICHA-HC) 3. Health care service providers (ICHA-HP) And two additional classifications from the Joint Questionnaire: 4. Health care financing sources (ICHA-FS) 4 2 Also available in Serbian language. 3 In this classification system, every part of expenditure is assigned to a specific function, provider and financing agents. The categories within each classification are broken down at different levels of detail, from the one-digit level to a maximum of a three-digit level. 14

15 5. Health care resource costs (ICHA- RC) The choice of these categories of the ICHA was guided by their relevance for health policy and reform issues, in particular for monitoring structural changes, such as shifts from in-patient to out-patient care and the emergence and spread of multifunctional providers in national health care systems. Dimensions of ICHA are cross-classified in five basic SHA tables requested by the Joint Questionnaire: 1) Table HP x HF: Current expenditure on health by providers and by financing agents 2) Table HC x HF: Total expenditure on health by functions of care and by financing agents 3) Table HC x HP: Total expenditure on health by functions of care and by providers 4) Table FS x HF: Total expenditure on health by financing sources and by financing agents 5) Table RC x HP: Resource costs (human resources) by providers of health care The table HC x HF is crucial to define the boundary of a health system, as, through functional classification, clear distinction is made between pure health s functions (HC.1 HC.7) and health-related functions (HC.R.1- HC.R.7). Within the Joint Questionnaire for all completed tables the following methodological information is requested: Data sources specified for each ICHA code Correspondence tables between health expenditure categories used in national practice and the ICHA Current state of ICHA implementation: Which deviations from ICHA are currently found in the country s SHA compilation Estimation procedures and adjustments 4.3. Building the accounts Key steps The strategy how to implement the NHA and main approaches used in practice are very clearly explained in SHA Guidelines and in WHO Guide to producing national health accounts. SHA Guidelines propose five steps of implementation presented below: 4 We have to distinguish between: 1) the financing agent (HF) these are the entities managing the funds (keeping funds, pooling them and purchasing services) and 2) the financing sources (FS) these are the entities providing the funds (through taxes, contributions to insurance, etc.). As additional table in the Joint Questionnaire (OECD, WHO, Eurostat) it is requested to fill in also the table FS X HF. 15

16 Figure 2: The process of NHA implementation Understanding health care system under study ( I) Investigating data sources (II) Creating a database (III) Filling the tables (IV) Resolving issues (V) Source: SHA Guidelines, 2003 In terms of the timeline, step I (the conceptual investigation) and step II (getting hold of key data sources) should be carried out first. These two steps were done in Montenegro by the end of December Investigated data sources and problems were listed in the document The conceptual and institutional framework for the compilation of the NHA in Montenegro. Steps III, IV and V should follow as an iterative process: (III) an initial compilation of the database using identified data sources; (IV) gaps and problem areas in the database identified and resolved by searching for new data sources, reconciling and making suitable estimations where necessary; (V) the database and tables updated accordingly. This process should be repeated until a final version of the tables is achieved. All these steps should involve an elaborate and complex system of checks and balances, choices, trial and error to decide how to put all the data together. This system helps to determine which data to use and why. Judging the quality of data sources is a key part of the iterative process. B Approaches In general there are two main concepts of building the accounts: top-down and bottom-up approach (SHA Guidelines, 2003). A top-down approach is used when most of the information for NHA is obtained taking figures directly from pre-existing aggregate health expenditure classifications and recording systems. This usually involves an extensive use of proxies, assumptions and other estimation techniques for breaking down pre-existing aggregates and also involves a limited amount of reconciliation. A bottom-up approach is used when most of the information for NHA is obtained using detailed information, possibly presenting activity information at a detailed level. Here aggregate data is used less frequently and reconciliation is often carried out. Pre-existing information is still used but the NHA developer does not attempt to migrate directly from one system of recording to NHA data. Under the bottom-up approach, could be following the financing agents approach or providers approach, it depends what kind of data sources are primarily used. If source of funding approach is followed then the core data are financial data on expenditures by different financing agents. On the other hand following provider approach means that the core data are: financial data on the receipts of the providers, data on the inputs used by providers (staff costs and 16

17 intermediate consumption) and data on the output they produce (number of activities and their prices/ costs). This information is then integrated with data on sources of funding where possible. SHA Guidelines strongly recommends the NHA compilers to use a bottom-up approach since the full value of NHA is realized only in this way. However in the first development round(s), some components may typically be estimated using so-called top-down approaches, whereby existing health expenditure aggregates are broken down according to the availability of proxies and other estimation techniques. Over time, as NHA are redeveloped, compilers should aim to replace topdown by bottom-up methods. 17

18 5. THE DEVELOPMENT OF THE NATIONAL HEALTH ACCOUNTS FOR MONTENEGRO 5.1. Institutional Framework The working group for the implementation of the NHA in Montenegro was established at the end of July Members of the working group were: - International experts: Mrs. Eva Zver 5 from Slovenia as team leader and Mr. Stane Marn 6 from Slovenia as a leading compiler for the NHA tables. - Four local experts: Mrs. Ruzica Milutinović 7 and Mrs. Ivana Golubović 8 from the Health Insurance Fund (HIS), Mrs. Irena Karadžić 9 from the Statistical Office (Monstat) and Mrs. Sadeta Lopičić from the Montenegro Public Health Institute. Local experts were chosen according to the recommendation that the NHA development task is best accomplished by a small team with one or two experts familiar with the nation s health system and health policy, one expert familiar with national economic statistics and accounting practices and one expert with skills and knowledge in health statistics. The tasks of the local experts were clearly defined and divided: - The experts from the Health Insurance Fund paid special attention the classification and data available at HIS; - The expert from the Statistical Office took responsibility for private health expenditure data and other important data used from the National Accounts Department (gross fixed capital formation etc.); - The expert from the Public Health Institute investigated public and private health expenditure data on preventive and public health services Key Institutions Key institutions that participated in the NHA project in Montenegro were: - The Health Insurance Fund (housing institution) - The Statistical Office (Monstat) - The Public Health Institute - The Ministry of Health, Labour and Social Welfare - The Ministry of Finance The Health Insurance Fund served as a housing institution for the NHA project. The most important factors that were crucial in the selection of the HIF as a housing institution were the following: 5 Institute of the Republic of Slovenia for macroeconomic analysis and development: eva.zver@gov.si 6 Statistical Office of the Republic of Slovenia; stane.marn@gov.si 7 Montenegro Health Insurance Fund; m.ruzica@t-com.me 8 Montenegro Health Insurance Fund; igolubovic13@gmail.com 9 Monstat; irenak@monstat.cg.yu 18

19 - All of the required human and technical support to implement NHA were available; - The HIF offered access to major data sources required to prepare the NHA and experts worked in close cooperation with the National Accounts Department from Monstat and other key institutions; - Political and institutional interferences were minimized; - Representatives from different institutions came together to collaborate; - The results of the project will be easily made available to health policy makers. A housing institution in Montenegro could also be the Statistical Office (the Department for National Accounts in Monstat). For example, in most European countries the responsibility for the NHA s development and further regular work on the compilation of NHA is at the official statistical offices. The reasons include access to databases and the linkages between the System of Health Accounts methodology with the National Accounts (SNA 93) and with other international statistical methodologies (COICOP, COFOG, ESPROSS). However, in Montenegro, like in other transitional countries, the official Statistical Office (Monstat), especially the Department for National Accounts, is faced with many high priority tasks including the development of all concepts in the methodology of the System of National Accounts (SNA 93) and the European System of Accounts (ESA 95). For this reason, it was better that an institution which is involved in the health system (and the need for better data seemed more urgent) assumed the responsibility for developing the NHA in close cooperation with the Statistical Office Steering Committee Developing health accounts often requires support from different institutions and health system regulators, for this reason it is useful to have representatives on the Steering Committee that can request or even require their organizations to produce the required information or to validate available figures. A committee of high-level representatives from stakeholder organizations can help to keep the project on track and to facilitate the institutionalization of the NHA effort. For the project in Montenegro, the Steering Committee was established in May High-level representatives from the stakeholder institutions were appointed: - Mr. Ramo Bralić from the Health Insurance Fund (head); - Ružica Milutinović from the Health Insurance Fund (secretary); - Mr. Nikola Vukićević from the Ministry of Finance (member); - Sanja Marković from the Ministry for Health, Labour and Social Welfare (member); - Boban Mugoša, PHD, Director of the Public Health Institute (member); - Olivera Miljanović, Director of the Montenegro University Medical Centre (member); - Gordana Radojević from the Statistical Office Monstat (member); - Bogdan Ašanin, PHD, Professor and Headmaster of the Montenegro Medical University (member); - Mina Brajović, leading Montenegro Health System Improvement Project (member); - Mirjana Kojičić from the Health Insurance Fund (member); - Milena Cvijanović from the Health Insurance Fund (member). 19

20 The responsibilities of the Steering Committee in Montenegro are: - To discuss policy interests with respect to health accounts; - To put into force a regulation that will support the NHA s compilation on a regular basis in the future; - To prepare an inter-institutional cooperation contract (including an agreement on data exchange and access to internal databases for the members of the core working group); - To make the NHA represent a part of the government s health sector reform strategy; - To ensure that the NHA should become an official development project for the Health Insurance Fund, Monstat and the Institute of Public Health; - To ensure that the NHA will enter the government s financial plans in the future, starting with the year Key Databases at Financial Agents and Providers In Table 1 and Table 2, the available data sources for the compilation of health accounts in Montenegro are listed. The identified databases and the recognized health financing data collection methods enabled the development of the NHA in Montenegro. Sources are divided into two main categories: (1) financing agents data, and (2) providers data sources. It is unlikely that the tables are exhaustive. In the future, new data sources are likely to be found. The data for health-related functions at least will require further investigation. Discovering these new data sources, as well as solving some of the problems listed in methodological section will form an important part of the NHA development project in the future. Table 1: Data sources relating to sources of funding Institution Health Insurance Fund Title of data source Type of source Internal record of all financing transactions 1 Notes: type of information, level of detail, possible disaggregating to HC and HP etc. Financing transactions could be disaggregated by providers and by health functions; possible disaggregating to the second or third level of HP classification and mostly to the second level of HC classification. Health Insurance Fund Annual report 1 Ministry of Health, Detailed budget report of Labour and Social all financial transactions Welfare 1 Ministry of Internal Detailed budget report of Affairs all financial transactions 1 Ministry of Finance Economic classification of expenses 1 Functional classification Ministry of Finance COFOG (Classification of the functions of 1 government) Ministry of Health, Labour and Social Welfare Evidence on external funding to the health sector 1 Providers in this register are identifiable with a tax identification number (PIB). Financial transactions could be disaggregated by providers and health functions. Financial transactions could be disaggregated by providers and health functions. Available only for the first level of COFOG classification (local government expenditures are not included). 20

21 Monstat (Statistical Office of Montenegro) Ministry of Health with the support of other institutions Household Budget Survey 2 Available for 2005, 2006 and Disaggregated by the first level of COICOP classification (the reliability of disaggregated data is questionable). Living Standards Measurement Survey (LSMS)-type National Health Survey * 1- administrative; 2-statistical survey Table 2: Data sources relating to providers 2 Conducted in Questions for the NHA s use were included in the survey. Institution Title of data source Type of source Monstat (Statistical Office of Montenegro) Ministry of Health, Labour and Social Welfare Health Insurance Fund Health Insurance Fund Institute of Public Health Institute of Public Health Monstat (Statistical Office of Montenegro) Monstat (Statistical Office of Montenegro) Business Register 1 The list of all active private providers in health care The Register of Compulsory Insurance Contributors (Baza podataka o obveznicima uplate doprinosa) Financial records on revenues and expenses of public health providers Hospital statistics 1 Record on the number of different health services provided by health institutions * 1- administrative; 2-statistical survey (Evidenca pruženih usluga) Statistical Yearbook (National Accounts Data) National Accounts Department Notes: type of information in database, level of detail, possible disaggregating to HC and HP etc. The Business Register contains records of all business units, regardless of their legal or institutional form. Data available in the Business Register includes: tax identification numbers, company titles, main activity codes (NACE Rev. 1), legal organization forms, institutional sector codes (ESA 95), number of employees etc. Data available in this register includes: tax identification numbers (PIB), company titles, addresses, main activity codes (by NACE Rev. 1), account number, number of employees etc. All public and private health providers are registered. An important source to estimate private health expenditure, because the revenues are disaggregated on the revenues from the HIF, households co-payments, households out-of-pocket payments and others. In accordance with the law on health statistics (zakon o evidenciji u oblasti zdravstva): the number of health institutions, the number of hospital beds, the number of patients, the number of hospital days, hospitalization statistics etc. - The estimation of output, gross value added and gross capital formation is available for activity N Health and Social Work (only the aggregate level); - Gross capital formation in activity N Health and Social Work. - Data on output in public and private pharmacies; - Financial reports of revenues and expenses for public providers (Revenues are not disaggregated on public and private revenues); - Financial reports of revenues and expenses for private providers (only records from the tax office are available). 21

22 In the methodological section of this report, detailed explanations are listed for the sources of data and the estimation techniques that were used for the initial compilation of the NHA in Montenegro. In general, data sources from the financers side enabled the start of the compilation process using the source of funding approach. Databases from the Health Insurance Fund and budget reports from the Ministry of Health, Labour and Social Welfare and other ministries are detailed and enable the disaggregating of public health expenditures by providers (HP) and mostly by functions (HC). Private health expenditures were estimated using different sources, as the Household Budget Surveys (HBS) and data on co-payments from the HIF served as the main data sources, however, a further investigation of private health expenditures was conducted by a special LSMS-type National Health Survey. Data sources available on the providers side, especially data from the annual reports of public providers and micro data from National Accounts were of great importance in order to acquire some additional information to estimate private health expenditures Methodological Information For the development of the NHA in Montenegro, the methodology from the original manual The System of Health Accounts, Version 1.0 from was followed 11, and, as an additional methodology, the Joint Questionnaire 2007 and 2008 was also used. The implementation method was similar to the method used at the Statistical Office of the Republic of Slovenia, which has been admitted to the international team for health accounts composed of the representatives from the WHO, the OECD and Eurostat. However, because of some missing data and poor developed statistical command in comparison to Slovenia, the method was adjusted in some parts. Initially, the team prepared the document called The conceptual and institutional framework for NHA implementation in Montenegro. This document was based on the assessment of available data sources and proposed a roadmap for explicit SHA implementation in Montenegro. It was determined to work in the three basic NHA tables: HP x HF, HC x HF and HC x HP, and potentially, to also work in the table FS x HF. Additionally, to be able to better estimate out-ofpocket spending, the team suggested to include some questions for the purpose of the NHA in a special LSMS-type National Health Survey that was conducted in the year However, the aim of the project was not the perfect completion of the NHA tables, but to prepare the first estimates of health expenditures for Montenegro according to the SHA s methodology by following basic definitions about the boundary of health care and to make an important exercise towards the full NHA s implementation project in the future. 10 The System of Health Accounts, Version 1.0 from the year 2000 is also available in the Serbian language. 11 Additional reading included: The WHO s Guide to producing National Health Accounts with special applications for low-income and middle-income countries (2003) and the SHA Guidelines written by the Office for National Statistics in United Kingdom (2003). 22