Social Health Protection In Lao PDR
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1 Social Health Protection In Lao PDR Presented by Lao Team in the International Forum on the development of Social Health Protection in the Southeast Asian Region Hanoi, 27-28/10/2014
2 Presentation Outline Country Profile and Health Indicators Healthcare and Social Health Protection Systems in Laos Health Expenditure and Revenues Challenges towards SHP Social Health Protection towards UHC 2
3 Country Profile & Health Indicators Country Profile: Population : 6.7 Million (2013) Country area : 236, 800Km2 Pop. Informal Eco. : 75% Poverty : 25% (2010) GDP per capita : $1,645 (2013) GDP growth : 8.1% (2013) Health Indicators (2012): MMR/100,000 : 375 IMR/1,000 : 48 U5MR/1,000 : 61 Life expectancy at birth 68 males : 66.5 females : 69.2 Source: World Bank and WHO
4 Health facilities Central Level: 4 central hospitals and 3 specialized centers. Provincial level: 5 Regional hospitals and 13 Provincial hospitals. District level: 131 District hospital and 892 Health centers Village Level: 5561 Village Drug kits and 1,133 Private clinics & pharmacies.
5 Organizational Chart of Lao Public Health System 5 5
6 Social Health Protection Systems in Lao PDR The social health protection system in Laos is formed by three health insurance schemes and one safety net The four schemes are implemented in a fragmented way whereby two are run by Ministry of Labour and two by Ministry of Health, as follows: State Authority for Social Security (SASS) Social Security Organization (SSO) Community-Based Health Insurance (CBHI) Health Equity Fund (HEF) These schemes present the following issues: 6
7 State Authority for Social Security (SASS) Established in 2008 and a compulsory scheme Under the Ministry of Labour and Social Welfare Covers civil servants & their dependant spouse and children under 18 years or 23 if continue to study Health care benefit is 1 of 8 benefits provided by the scheme, including health insurance, working injury benefits and short and long term benefits 7
8 Social Security Organization (SSO) Established in 2001 Under the Ministry of Labour and Social Welfare Covers private and state-own enterprise employees & their dependant spouses and children Health Care benefit is also 1 of 8 benefits provided by the scheme It s a so-called mandatory scheme, therefore very low compliance, with approx. 36% of targeted employers enrolled The Schemes: SASS and SSO will be merged into the National Social Security Fund from F.Y onward 8
9 Community-based Health Insurance (CBHI) Launched as pilot project by Ministry of Health in 2002 It is a voluntary social health insurance scheme for informal economy. Members are eligible for benefit package obtained from primary health care providers and referral hospitals at provincial and central level Low enrolment more likely to be ill people and high drop-out rate esp. healthy and rich people 9
10 Health Equity Fund (HEF) Financed by government and donors launched in 2004 Targeted at the poor Run by Ministry of Health and some HEFs are administered by Non-state Partners (e.g: the Lao Red Cross/Swiss Red Cross) Using either reimburse providers or a combination of capitation and case-based reimbursement Utilization of services trend to increase 4 SHP Schemes (SASS, SSO, CBHI and HEF) will be merged into the National Health Insurance Fund 10
11 Social Health Protection System in Lao PDR: SASS SSO CBHI HEF MCH Fund Membership Mandatory Voluntary The poor Mother & Child Target population Civil Servants +dependents SOE and private employees+ dependents Self-employed & informal population Families identified as below the poverty line by donor agencies Member Contributions 16.5% of salary (4% & new Law: 1.5% to SHF) 9.5% of salary (+2% for UI) (2.2% & new Law: 1.5% to SHF ) Monthly payment depending on family size, urban & rural (about 2-3% of household income) none, required none, required Benefit package OPD & IPD (but some exclusion, e.g. high cost or some service items and traffic accidents) OPD&IPD including travel & food costs OPD&IPD, P&P including travel & food costs Payment Method Capitation + high cost, transportation and some additional chronic diseases (Now Cap: 85,000 LAK, 50% of some high cost and 5,000 LAK for Chronic diseases) Capitation with referral system -Capitation and/or -Fixed fee and/or - Fee for service *depends on donor agency -Capitation and/or -Fixed fee and/or - Fee for service *depends on donor agency Ministerial auth. MOLSW MOH MOH MOH
12 Social Health Insurance Coverage 70% 65% 60% 50% 40% 30% Targ. Cov. 20% 10% 0% 15% 11% 11% 12% 9% 2.43% 2.61% SASS SSO CBHI HEF Total coverage ( ): 28.04% of population
13 Health expenditure in Laos Total health expenditure (exp.) as % of GDP 2.90% Out of pocket payment 46.4% Govt s Budget + external financial 40.7% (of which external resources 22.10%) Social health insurance fund 2.8% or 4.9% as % of toatl govt. exp. on health Govt. exp. on health as % of total govt. exp. 6.10% Source: World Bank & WHO
14 Health financing flows in the Lao health system Source: World Bank
15 Use of Health Funds Source: NHA 2009/2010
16 Payment mechanisms of healthcare providers Option for payment mechanism of SHP in Laos DRG Casebase payment - Not ready for now - Weak health infrastructure: information system, staff capacity, non-computerized management system - Somehow ready Capitation - Ready - Too few categories of treatment cases leading to difficulties for providers to balance the income, especially in the case of referral - We need strong monitoring system to prevent overreporting and improve quality control - Capitation or adjusted capitation - Referral issues: who should pay? Should referral costs be included in the capitation rate?
17 Options for capitation Easy to implement Good to control utilization (ideal for civil servants, voluntary insurance) Problems: no-referral, deficit revenue for providers, no incentive to provide good quality care, no incentive to increase the volume of care Capitation should be adjusted BUT HOW? Utilization adjustment: current capitation rate can cover more than 1 OPD and about IPD/year/person Risk adjustment: age High-cost adjustment: Additional payment for high cost services or case-based payment for IPD
18 Legal framework for SHP First Decrees changing health care financing in Lao PDR : Budgetary constraints increasingly limited the health care that government could fund: Decree 52 in 1997 introduced user fees in for specific services Decree 230 expanded the Revolving Drug Funds (RDF) The Law on Health Care in 2005 Decree 470 establishment the National Health Insurance Bureau Decree 349 introduced user fees in for specific services Decree 207 on Social security for employee in private sector Decree 70 on Social security for civil servant The Law on Social Security-Establishment of National Social Security Fund (aiming to merge SSO and SASS)
19 Other National Development The Sixth National Social Development Plan ( ) identifies health as one of four sectors for development. The Health Strategy to the Year 2020 in this National Plan is Strategic Programme 12, in which the first basic concept is full health care services coverage and equity. Resolutions of the Eighth Party Congress on financing health care, including the expansions of social health protection for the informal sector. The Prime Minister s request issued at the end of March 2009 for the Ministry of Health and Ministry of Labour and Social Welfare to take steps towards the merger of all the social protection systems. National decision to cover 50% of the population by 2015
20 Toward Toward Universal Universal Health Health Coverage Coverage in Laos in Laos Universal Health Coverage and full sustainable funding Cover 50% of total pop. NHIB is launched and QA and HA Cover 30% of total pop Full Merging with other SHP (SASS, SSO, CBHI, HEF & MCH) Covered ~ 25 %
21 Challenges towards SHP There is an important difference between universal coverage in terms of access (i.e., health network) and in terms of financing (i.e., social protection). The main challenges facing the health sector are related to financing and coverage extension : More than 75% of the population live in remote areas and 30% belonging to ethnic minority groups. Around 25% of the population below the poverty line. High reliance on out-of-pocket money force to either reduce utilization of health care and leading to risks of impoverishment. 21
22 Challenges towards SHP Low compliance rate Greater challenge in term of memberships and collecting contributions due to majority of them live in rural and remote areas where low population density and people not accustomed to the concept of social health insurance The informal themselves are unwilling to join the scheme or pay contributions for a number of reasons: a limitation of general understanding small and irregular incomes Low quality of healthcare services, and High potential rate of drop out the scheme
23 Challenges towards SHP The key challenges towards universal social health protection coverage are: About 73% of population are non covered by any scheme, their health care services have been primarily financed through direct out-of-pocket money Acknowledging the need for a long-term effort (progressive coverage, continuity) and need for a mix of social protection schemes Focusing on expanding coverage when a reliable package and financing are reached 23
24 Social health protection towards UHC The Govt. is committed to harmonization of existing health insurance systems and extension of coverage and issued a decree on the establishment of the National Health Insurance Bureau Social Security Law is adopted aiming to merge SSO and SASS into the National Social Security Scheme the Govt. has also approved the guideline on the exemption of charges for Maternal, Neonatal and Child Health services 24
25 Social health protection towards UHC Extension of social security scheme to all employers (now employers with 10 or more workers) and enrolment of the self-employed formal referring to the new Law on Social Security are: employer hiring at least one employee, self-employed and voluntarily insured person Merging health insurance schemes into the National Health Insurance Fund and some redistribution of funds between the salaried and informal economies to allow for broader pooling 25
26 Social health protection towards UHC Establishing an autonomous national health insurance scheme for rural populations Government subsidies partially funding for the informal sector and fully funded for the poor Developing additional revenue opportunities via hydro power or earmarked sin taxes or lotteries Ensuring appropriate legislation for the above stages and to reach universal coverage 26
27 Social health protection towards UHC Develop strong leadership by the Government, esp. at Ministry of Health and the Ministry of Labour and Social Welfare, with a continued dialogue and collaboration between the main stake-holders. Develop an action plan with clear objectives towards universal coverage, with a timetable for leading to the appropriate legislation and merging of systems. 27
28 Inter-schemes and inter-sectoral mechanisms to improve the SHP Develop joint activities among the four existing schemes to solve similar problems and improvement of administration capacity Progressively use joint administration and reporting systems between existing schemes Progressively join capitations upstream and pay providers by a single payment mechanism Additional resources from govt. or external are needed to improve the SHP 28
29 Implementation National Health Insurance Fund for Universal Health Coverage NSSF HI payment Government NHIF Fully subsidized for the poor 50% of health premium for near poor pop. Subsidies administration cost for NHIF Health Insurance Members Non members; who finally become members Provide Services Searching services Out of pocket payment Public Health Facilities NSSF: The National Social Security Fund NHIF: The National Health Insurance Fund 29
30 What do we need? Clear commitment and Participation from Governments at all levels (National, Provincial & District) Increased funding Political commitment and support to the implementation of the Health Financing Strategy and the Decree on the National Health Insurance
31
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