ZIMBABWE HEALTH FINANCING. GWATI GWATI Health Economist: Planning and Donor Coordination MOHCC Technical team leader National Health Accounts.

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1 ZIMBABWE HEALTH FINANCING GWATI GWATI Health Economist: Planning and Donor Coordination MOHCC Technical team leader National Health Accounts.

2 Our approach to HFP Development Key steps in the development of the policy have been undertaken: The development of this policy is highly consultative A Technical Working Group was established to drive preparatory activities towards this policy The TWG established a Core Team to focus on the specific pillars in the policy. A number of meeting sessions were convened by TWG- to arrive at draft zero Next steps: stakeholder consultations Draft with stakeholder inputs Validation workshop

3 Conceptual Framework: HFP Architecture

4 Overview of the Policy Motivation and Context Policy Strategic Context Health Financing Policy Strategic Directions General Health Financing Policy Guidelines Health Financing Functions Evidence of Current Situation and Rationale Conceptual Framework Resource Mobilisation and Revenue Collection For Each, the HFP States i) The Guiding Principles, ii) Policy Objectives and iii) Policy Direction Risk Pooling and Cross Subsidisation Purchasing and Prov Payment Mechanism Governance

5 Motivation and Context Global call for UHC Socio-economic factors Increasing Disease Burden Need to harmonise all health financing functions

6 Overview of Health Financing in Zimbabwe Zimbabwe s health system has been consistently financed by a mixture of funding sources with the major ones being : Government through central budget allocation and subnational governments i.e. local authorities AID Agencies and Multilateral Organizations Private companies, Non-Governmental Organizations, households (through out-of-pocket payments)

7 HEALTH FINANCING POLICY Summary of Policy directions

8 Strategic Directions Vision The whole population of Zimbabwe has access to the highest possible level of health and quality of life regardless of income levels, social status, or residency. Mission To provide, administer, coordinate, promote and advocate for the provision of equitable, appropriate, accessible, affordable and acceptable quality health services and care to all Zimbabweans while maximizing the use of available resources, in line with the Primary Health Care Approach. Goal The goal of the Health Financing Policy is to guide Zimbabwe s health system to move towards Universal Health Coverage (UHC) including financial risk protection, access to quality essential health care services, and access to safe, effective, quality, and affordable essential medicines and vaccines for all by 2030.

9 Policy Objectives The National Health Financing Policy will be focused on reaching the following objectives: Mobilizing adequate resources for predictable sustainable funding of the health sector; Ensuring effective, equitable,efficient and evidence based allocation and utilization of health resources; Enhancing the adequacy of health financing and financial protection of households and ensure that no-one is impoverished through spending on health by promoting risk pooling and income cross subsidies in the health sector; Ensuring that purchasing arrangements and provider payment methods emphasize incentivizing provision of quality, equitable and efficient health care services Strengthening institutional framework and administrative arrangements to ensure effective, efficient and accountable links between revenue generation and collection, pooling and purchasing of health services.

10 Guiding Principles and Values The following values will guide the Health Financing Policy at all levels: Social solidarity Equity in health and health care Gender equality Healthcare as a right and shared responsibility Essential quality services integrating comprehensive primary health care Cost benefit and value for money Efficiency Appropriateness Affordability Public participation and user and provider satisfaction Transparency and accountability Ownership and Partnership in health

11 Sustainable Resource Mobilization and Revenue Collection Policy Directions The GoZ will seek to strengthen domestic health financing and abide by the Abuja Declaration on Health where not less than 15% of budget shall be allocated to health. The GoZ will spend not less than $60 per capita per year to ensure the minimum comprehensive benefit package is financed. The GoZ will explore options for progressive earmarked taxes and levies to raise additional resources for health. Current mechanism to raise additional revenue to the health sector that has been successful and sustainable will be maintained and expanded where feasible. Examples include the National AIDS Levy, Health Services Fund, Workman s Compensation Fund, Assisted Medical Treatment Order, and Accident Victims Compensation Fund on Motor Vehicle Insurance. The government will encourage various forms of mandatory prepayment mechanisms such as social health insurance (SHI), community based health insurance (CBHI), national health insurance (NHI) especially for the informal sector and rural areas as a means of achieving universal health coverage.

12 Sustainable Resource Mobilization and Revenue Collection Policy Directions cntd Private health insurance will continue to be available as a voluntary prepayment mechanism for services not covered in the minimum benefits package. Special revenue generation provisions will be made for diseases of high national public health concern/significance as and when they emerge. All external aid for health will be harmonized, coordinated, monitored and evaluated in line with health priorities and plans of the government of Zimbabwe. The GoZ will continue to encourage and expand involvement of local philanthropy and charities for special health initiatives at all levels of care. The GoZ will explore, ensuring consistency with its key policy principles and goals, innovative partnership mechanism with the private sector to increase resources to health such as Public Private Partnerships, joint ventures and outsourcing guided by a strong regulatory framework.

13 Risk Pooling and Cross Subsidization Policy Direction The government of Zimbabwe will explore new and strengthen existing mechanisms for promoting equity, risk equalization and reduce fragmentation with a special emphasis on ensuring that health spending does not lead to or deepen impoverishment especially in the poor and indigent population. A national mandatory prepayment scheme will be introduced and expanded as a key form of pooling risk to reduce out of pocket payments. There will be clear separation of functions and roles between pooling and purchasing of healthcare services.

14 Purchasing Policy Directions Priority will be given to the purchase of cost effective services and those essential for achieving universal health care, that is, the Essential Health Benefit package at all levels of care (primary, secondary, tertiary, and quaternary) A framework for regular evaluation of benefits and cost interventions will be put in place to ensure optimal choices. Services will be purchased from all registered and accredited providers (private and public). There will be separation of purchasing and provision functions for health care services. Health care resources will be allocated using needs based formula to achieve equity. There will be strengthening of current purchasing mechanisms and developing others that ensure that those who cannot afford to pay can still access services without facing impoverishment. There will be use of a mix of provider payment mechanisms that promote optimal provider performance while containing costs. There will be quality assurance for services purchased irrespective of funding mechanisms and level of care.

15 Governance Policy Directions Establishment of a Health Financing Coordinating body within the MOHCC to coordinate the various pillars of this policy (i.e., funds collection, pooling and purchasing functions within the GoZ) Financial management autonomy will be accorded to operational levels to effectively perform various health financing functions within the confines of the Public Finance Management Acts. The role of performance based financing in current and future schemes to be clearly defined where it strengthens the purchaser s function. Planning, budgeting and resource allocation will be harmonized along the results based management principles in consultation with all stakeholders. The GoZ will strengthen existing mechanisms and/or establish new structures and systems for coordination and harmonization of funding at all levels of health care financing.

16 National Health Accounts 2015 in Zimbabwe

17 Outline Background and objectives Methods Findings General findings and international comparison Who funds the health system Revenue of health schemes and financing sources Who manages health funding Financing schemes and financing agents Who consumes health expenditure and for what purpose Health expenditure by health providers Health expenditure by health functions Summary and recommendations

18 Background Government of Zimbabwe is committed to universal health coverage (UHC) Since 2010, Zimbabwe made significant strides in reducing infant mortality rates (IMR) and Maternal Mortality Rates (MMR) Health financing landscape may have been changed since 2010 when last round of NHA was conducted To understand key players and financial flows in the health system, NHA 2015 was conducted

19 Objectives of the NHA 1. Provide updated estimates of health expenditure in Zimbabwe s health care system and an understanding of financial flow 2. Provide financial estimates for the health system in Zimbabwe at three levels, including sources of funding, financing schemes or management institutions, and providers and functions of health expenses; 3. Provide empirical evidence on health financing for developing health financing policy and strategies in Zimbabwe, and 4. Produce baseline information on health expenditure for comparison to future reforms.

20 Terminologies 1. Revenue of health financing schemes: Revenue is an increase in the funds of a health care financing scheme, through specific contribution mechanisms. 2. Financing sources (FS): The revenues of the health financing schemes received or collected through specific contribution mechanisms 3. Health schemes (HF): Components of a country s health financial system that channel revenues received and use those funds to pay for, or purchase, the activities inside the health accounts 4. Financing agent (FA): Institutional units that manage health financing schemes. 5. Health providers (HP): Entities that receive money in exchange for or in anticipation of producing the activities inside the health accounts boundary. 6. Health functions (HC): the types of goods and services provided and activities performed within the health accounts boundary.

21 General Findings and International Comparisons

22 Overview of Findings NHA Indicators (General) 2015 Total population(zimstat) 13,943,242 Total nominal GDP (US dollar [USD])(Zimstat) $14,007,108,087 Total government health expenditure (USD) $309,699,620 Total health expenditure (THE) $1,447,785,504 THE per capita (USD) $ THE as % of nominal GDP 10.34% Government health expenditure as % total government expenditure 8.72%

23 Total health expenditure as % of GDP Regional comparison Total Health Expenditure (THE) % Gross Domestic Product (GDP)

24 Total health expenditure per capita Health expenditure per capita (USD) $ Total Health Expenditure (THE) per Capita in US$ $ $ $ $ $ $0

25 Who funds the health system?

26 Financing sources (Institutions) Financing sources Amount (Million USD) Percentage of THE Government (Central and local governments) % Corporations (Employers) % Households (OOP plus private contribution to health insurance) Non-profit institutions serving households (NPISH) % % Rest of the world (Donors) % Total %

27 Financing source by sector Financing sources Amount (Million USD) Percentage (%) Public (Government+ HI from public employers) Private (OOP+ HI form private employers or HH) % % External (Donors) % Total %

28 Who manages health expenditure?

29 Who manages money (Health schemes) Rest of the world financing schemes % Household out-ofpocket payment % Government schemes and compulsory contributory health care financing schemes % Voluntary health care payment schemes %

30 Who manages money (Institutions)--- Financing agent Households % Rest of the world % General government % Corporations % Insurance corporations %

31 Out of pocket health expenditure The total out of pocket expenditure reported on the household survey was estimated at $ million, equivalent to $24.65 per capita. 7.6 percent of households in Zimbabwe incurred catastrophic health expenditure (CHE) in 2015 Poorest Less poor Middle Less rich Richest Total Pop Incidence of CHE 13.38% 8.68% 8.37% 5.20% 2.77% 7.64%

32 Health expenditure by providers and functions

33 Health expenditure by providers Providers of health care system administration and financing 12.1% Providers of ambulatory health care 33.3% Providers of ancillary services 6.7% Providers of preventive care 6.2% Retailers and Other providers of medical goods 4.1% Other 1.1% Unspecified health care providers 0.7% Rest of the world 0.3% Hospitals 36.5% Rest of economy 0.1% Residential long-term care facilities 0.0%

34 Health expenditure by functions Governance, and health system and financing administration 12.1% Preventive care 15.4% Ancillary services (nonspecified by function) 7.4% Medical goods (nonspecified by function) 3.5% Long-term care (health) 2.4% Other 5.1% Other health care services not elsewhere classified (n.e.c.) 1.8% Curative care 56.6% Rehabilitative care 0.9%

35 Health expenditure of Government schemes by health functions Functions Amount (Million USD) Percentage Curative care % Rehabilitative care % Ancillary services (non-specified by function) % Preventive care % Governance, and health system and financing administration % Total %

36 Health expenditure of health insurance from public employers by health functions Functions Amount (Millions USD) Percentage Curative care % Inpatient curative care % Outpatient curative care % Ancillary services (non-specified by function) % Medical goods (non-specified by function) % Governance, and health system and financing administration % Total %

37 Health expenditure of health insurance from private employers or households by functions Functions Amount (Millions USD) Percentage Curative care % Inpatient curative care % Outpatient curative care % Unspecified curative care (n.e.c.) % Ancillary services (non-specified by function) % Medical goods (non-specified by function) % Preventive care % Governance, and health system and financing administration % Total %

38 Summary and Recommendations

39 Summary Overall health expenditure THE was estimated at $1.45 billion, equivalent to $103.83/capita. THE accounted for more than 10 percent of GDP of the same year Financing sources Domestic resources account for the majority (75.74 percent) of THE Donors remain an important source of funding for health in Zimbabwe (24.26 percent), particularly for preventive care. Health insurance schemes through public and private employers and individuals accounted for percent of THE, with expenditures of $ million. Financial protection OOP represents 25 percent of THE 7.6 percent of households incurred catastrophic health expenditure 13.38% of the poorest households incurred catastrophic health expenditure

40 Summary (continued ) Health providers and functions Health expenditure was unevenly distributed between curative and preventive care. Curative care shared 57 percent of THE, while preventive care accounted for 15 percent of THE The administrative costs accounts for more than 14% of funds managed by health insurance companies More than 30% of health expenditure of health insurance for public employees were spent to ancillary services

41 Recommendations Increase government spending on health Advocate allocation of government budget for health, reversing the decline trend of budget allocation. Advocate both health and economic benefits of investing in health Allocate more resources for preventive care Government needs to take more responsibility of preventive care Advocate value for money of investing in preventive care Improve efficiency of health insurance schemes Reduce administrative costs Strategic contracting health providers Utilization review of claims Reduce fragmentation of health insurance schemes

42 Recommendations (continued ) Develop strategic purchasing mechanisms Pay health providers based on outputs or outcomes rather than inputs Grant health providers with autonomies Incentivize better quality and outcomes. Address inequities of utilization of health services and catastrophic health expenditure Subsidize the poor Improve the quality of care at public facilities, particularly for ancillary services (e.g. imaging services) Include the poor in the social welfare safety net Carry out an equity study to understand better the inequality issue. Strengthen the integration of vertical and disease specific programs

43 THANK YOU FOR LISTENING END