Sri Lanka s Health Sector Issues, Challenges and Future Dr Ravi P. Rannan-Eliya Director Institute for Health Policy www.ihp.lk Ceylon Chamber of Commerce Colombo 26 September 2005
Outline A performance assessment Links to development and governance Strategic issues Way forward
A Performance Assessment Health outcomes Financing and cost Services and efficiency Equity
Impact on our health 100 80 60 40 20 0 Income per capita (2000) IMR (2000) Low income Sri Lanka Lower-middle income Middle income Upper-middle income
Performance over time IMR 1980, 2002 IMR reduction % 1980-2002 OECD OECD Middle-income Middle-income Lower-middle income Lower-middle East Asia & Pacific East Asia & Pacific Sri Lanka Sri Lanka Low-income Lower income 0 50 100 150 0 20 40 60 2002 1980
Is it the health system? YES Education, nutrition, geography, women and culture do matter, but Sri Lanka does even better Critical factors High levels of use of modern services Few barriers to use by poor
High use of services Outpatient utilisation Inpatient utilisation OECD OECD Sri Lanka Sri Lanka Middle income Middle income India India Indonesia Indonesia Low income Low income 0 5 10 15 20 0 5 10 15 20 25 Low High
What does it cost? National health expenditure in 2002 3.6% of GDP Per capita 3,010 rupees (US$ 31) Government spending 19901.7% of GDP 19951.6% of GDP 20021.6% of GDP
Who pays? 1.9% 1.1% 4.1% 48.0% Total 3.6% of GDP in 2002 Rs 3,010 per capita (US$ 31) 0.4% 44.5% Government Donors Households Employers Insurance Non-profits
How does spending compare? 16 14 12 % GDP 10 8 6 4 2 0 Bangladesh India Sri Lanka China Thailand Public Malaysia Hong Kong Private UK USA
Who provides? Outpatient 48 Inpatient 97 0 25 50 75 100 Government Private
Efficiency Macro-level Health sector is by international standards highly efficient in its use of resources Achieves high levels of output at acceptable quality with minimal resources High levels of labour productivity Intensive use of physical inputs Micro-level Range of inefficiencies
Equity Do Government Services Reach the Poor?
Hong Kong, SAR Taiwan South Korea Sri Lanka Bangladesh China (Ganzu Province) India Thailand Indonesia Targeting of public subsidies Share (%) of inpatient spending reaching poorest quintile 0 20 40 60 Public Total
Poverty impact Percent of households pushed below PPP$1 poverty line by medical spending Bangladesh India China Vietnam Indonesia Philippines Sri Lanka Thailand Hong Kong Taiwan Korea 0% 1% 2% 3% 4%
A score card Effectiveness, efficiency Delivers exceptional health outcomes Delivers high volumes of outputs for minimal inputs Equity Reaches the poor better than most developing countries Protects effectively against impoverishment
The GMOA: A case of Dr Jekyll and Mr Hyde? Critical to performance of sector has been staff commitment and professionalism High by international standards But has been retained despite politicization of public sector GMOA central to the sector s struggle to slowdown politicisation Most strikes not about pay, but appointments and rules
Linkages to development Health system a factor in political stability Engenders social solidarity Mitigates worst features of poverty Global experience High-growth economies have generally balanced market-led industrialization, with commitment to public funding of health services Germany, Japan, Korea, Taiwan, Hong Kong Temporary exceptions - Thailand, China, Singapore
Challenges and Problems Inadequate public funding Antiquated approach to primary care Increasing middle-class consumer dissatisfaction with government services Aging of population
Inadequate public funding Market economies rely predominantly on public financing, and increasingly so Sri Lanka - only market economy in Asia, Europe and North America not to have increased public expenditure as % GDP in past 15 years
Government health spending 1990-2002 8 7 6 5 4 3 2 1 0-1 Sri Lanka Thailand Malaysia China Hong Kong Taiwan Japan USA 1990 2002
Antiquated primary care Primary care policies 1926-1990 model for the world Verticalized services, hospital OPD-based delivery system But lacks continuity of care, ability to manage chronic adult problems, keep patients out of hospital, etc Modern paradigm for primary care requires a different approach Family-based primary care services delivered through specialized family medicine physicians But not possible without system for training and recruiting GPs
Consumer dissatisfaction Consumer dissatisfaction increasing Driven by increasing expectations, not declining standards Need for more person-oriented, continuity of care, etc Demand for improved consumer amenities in hospitals, improved staff attitudes, reduced queuing, etc Trend in advanced countries to introduced marketflexibility into public-funded hospitals Hospital autonomy, internal markets, etc
Ageing population Ageing will not be the main driver of increasing costs But ageing will change the demand for services Chronic illnesses require continuity of care and more specialised primary care (e.g., diabetes, heart disease, etc) Modern prevention of heart disease, diabetes is not cheap - life-style drugs, aggressive management of myocardial infarctions, etc Geriatric patients require focused management Future need for long-term care, home nursing, etc
Key Issues Health sector has done well in the past, but future challenges require a changed approach Increased public financing To permit Introduction of modern primary care system Increased consumer responsiveness by restructuring hospital services Filling in the gaps But requires increased taxation either as general revenues or social insurance