USING DHS AND NHA INDICATORS TO ANALYZE EQUITY IN HEALTH FINANCING. Magdalena Rathe Fundación Plenitud IHEA 2007 Copenhagen, Denmark

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1 USING DHS AND NHA INDICATORS TO ANALYZE EQUITY IN HEALTH FINANCING Magdalena Rathe Fundación Plenitud IHEA 2007 Copenhagen, Denmark

2 Summary of findings and examples from three studies Nicaragua: Health and Equity, USAID, Evolution of Nicaraguan NHA , with international perspective, Harvard School of Public Health / MSH, Dominican Republic: NHA 2002, within a LAC context, CERSS / IADB, Santo Domingo, 2006.

3 Health Financial Equity contributes to human development Human development objective: attain equal oportunities for all Government intervention is required to: Correct inequalities Improve income distribution Reduce poverty

4 Data sources for papers National Health Accounts studies in several LAC countries: DR, Nicaragua, Mexico, Bolivia, Guatemala, El Salvador and Paraguay. Demographic and Health Survey (DHS) in Nicaragua and the DR, years 1996 and WHO NHA indicators for some specific analysis.

5 Few NHA international comparative studies: four studies reviewed Berman, Peter, Berman, Peter, et al, Health Care Financing in Eight Latin American and Caribbean Countries: The First Regional National Health Accounts Network, Harvard School of Public Health and PHR- USAID, 1999 Magnoli, Alessandro, NHA in LAC: concepts, results and employment policy, Harvard/ IDB/ INDES, (2001). Nandakumar, A. K. et al, Synthesis of Findings from NHA Studies in Twenty-Six Countries, PHRplus / Abt Associates, Maryland, USA, Berman, Peter and Heather devries, Differences in National and International Estimates of National Health Spending in Developing Countries, Harvard School of Public Health, (2005).

6 Deficiencies in data comparability Most LAC studies focused on the first NHA LAC round (years 1995 to 1997). Many variables are not comparable (do not measure the same). The methodological approach and the definitions of health expenditures, entities and functions were not standardized at that time (even using the NHA approach).

7 WHO NHA indicators WHO produces yearly NHA indicators (not complete NHA) for almost all countries in the world. For most comparative analysis this is the best source available. However, there are differences between these estimations and those produced by the LAC countries national teams. The latter when available are probably more accurate.

8 In order to assess financial equity we focused in: Relationship between public and private financing and expeditures. Patterns of health services consumption and expenditures Financial burden of health expenditures on household income. Distributive impact of public expenditures.

9 Relationship between public and private expenditures Examples

10 Positive relationship between public financing and equity Most developed countries have a very high proportion of health expenditures financed by the Government through: General taxation Social or public insurance Out-of-pocket expenditure is the most unequal way of financing health care.

11 Per Cápita Expenditures (US$ average rate) Promedio LAC PAR GUA BOL ES MEX RD NIC

12 Public Health Expenditure as a % of Total Health Expenditures NIC RD MEX ES 1997 BOL 2002 GUA PAR Promedio LAC

13 Out-of-Pocket Health Expenditures as a % of Total Health Expenditure NIC RD MEX ES BOL GUA PAR Promedio LAC

14 Social Insurance as a % of Total Health Expenditure NIC RD MEX ES 1997 GUA 2002 PAR Promedio LAC

15 Private Insurance as a % of Total Health Expenditure NIC RD MEX ES P AR P rome dio LAC

16 Patterns of health services consumption and expenditures Examples

17 DR: Utilization of Ambulatory Care (poorest 20%) S ES P AS IDS S Milita r P riva d o ONG Otro

18 DR: Inpatient Utilization (poorest quintile) Private clinics 30% Social Security 2% MOH 68%

19 Several other analysis Differences in access, in service utilization, type of service consumed, health expenditures by type, etc.: Age Sex Place of residence (urban/rural, provinces, states or departments) Income or welfare groups

20 Financial Burden of Health Expenditures Examples

21 Nicaragua: Financial Burden of Health Expenses (% of household income) 10.0% 8.3% 8.0% 5.6% 6.0% 5.3% 5.4% 4.0% 2.9% 2.0% 0.0% Poorest Q2 Q3 Q4 Richest

22 Nicaragua: Origin of Funds to Finance Inpatient Care, % 32% 28% 35% Loan Savings Sale of Assets Others

23 DR: Insurance Coverage, Quintil Quintil Quintil Quintil Quintil

24 Nicaragua: Outpatie nt He alth Expe nditure s by Function, 2001 Other 20% Laboratorio 14% Consultation 10% Drugs 56%

25 Nicaragua: Most Drugs Bought by Households 19% 44% 17% 20% Analgesics Antibiotic Antitusives/Asma Others

26 Drugs Expenditures as a % of Total Health Expenditures NIC MEX BOL GUA

27 Drugs: Guidelines for policy Drugs represent the main component of out-of pocket household expenditures and sometimes of total expenditure. More expenditures in prescripted drugs in Nicaragua although self medication is important. Policy guidelines to: Reduce the total expenditure level Reduce the financial burden of health expenditure on households income. Increase financial equity in the health system.

28 Distributive Impact of Public Expenditures Examples

29 Distributive impact of subsidies Are public subsidies progresive? Do they help reduce inequities in the society? Do they help reduce poverty? Do they contribute to the building of an equal opportunities society? Do they create human develpment?

30 DR: Household Health Consumption by Source of Financing (income quintile groups) Who pays for health care? Richest Q4 Q3 Q2 Poorest 0% 20% Households 40% 60% Government 80% 100% IDSS

31 Nicaragua: Proportion of Population that Receives Free Health Services !st Quintile 2nd Quintile 3rd Quintile 4th Quintile 5th Quintile

32 Conclusions regarding equity In the selected LAC countries, there are important inequities in the health system. An important amount of health expenditure comes from OOP Public subsidy is distributive in two countries: represents a higher proportion of low income groups. Consequently it has the potential to contribute to equity. But the amount is low: it has no effect in building human development There is a clear need to increase public expenditure (as well as improve efficiency and quality).

33 Conclusions regarding data comparability: advances Methodological standardization (PG implementation and SHA revision) Countries require more donor support to produce consistent, coherent and comparable data. New rounds of regional networks desirable (meetings and on-line conections). Funds for research, data analysis and dissemination of information.

34 Conclusions on households data Key data to assess equity. Standardization of a health expenditure module to be included in the most reliable national survey. Inclusion of questions to estimate total household income or consumption. Triangulate information of households through supply side survey

35 Conclusions on household s data More effort is required on studying the drug s market: Drugs expenditures have a heavy impact on total household expenditures. It is necesay to triangulate the information with market studies. Identify specific products where certain policy measures could be the most effective to contribute to health system equity.

36 Thank you!