Contact n°141 February - March 1995 : Financing Health Care: Strengthening partnerships to project the poor

24 Pages·1995·6.5 MB·English

Centact
A publication of the CMC-Churches’ Action for Health, World Council of Churches
FINANCING HEALTH CAR
No 141
February-March 1995
FinANCING HEALTH CARE
1 Background
David Werner describes
the build-up to the crisis
5 World Bank viewpoint
Summary of “Investing in
Health”, World Develop-
ment Report 1993
9 WHO response
“Better health needs more
than the health sector”
13 What can we do?
Making the most of the
World Bank’s focus on
health services, and
deciding on a strategy for
action
UPDATE /
18 “Renewing our mission in -
health” CMC-Churches’
Action for Health meeting in
‘London
NETWORKING
19 Useful publications, Letters,
Announcements
21 List of back issues of Contact
EDITORIAL
No one would doubt that there is aneed and spiritual, as well as bio-medical.
to increase the amount of money spent This makes the technocratic solutions
on health care in the developing world. for coping with the medical part of ill
Nor is there any doubt that efficiency in health outlined in the WDR difficult to
health care expenditure needs to accept.
increase.
Nevertheless, the approach to health
But is the World Bank’s World Develop- care financing reform provided by the
-ment Report (WDR) 1993 entitled WDR is now being widely discussed
“Investing in Health” able to provide around the world. This is why we decided
solutions for greater and more efficient that it was essential to be aware of both
financing? The report argues that more its pitfalls and its strengths.
competition means more efficiency, with
In this issueo fC ontact, we want to chart
more money coming into health sector.
a course ahead. We begin with the life-
But we believe that competition is often
story of primary health care so far by
wasteful and that the poor are suffering.
publishing an extract from a paper by
The report was introduced in a period of veteran campaigner, David Werner. He
The World Bank's World economic crisis coupled with massive shows how the original understanding
increase in demand for and principles of primary
Development Report
health services. The eco- health care have been
(WDR) is being widely
nomic crisis, often coupled gradually broken.down over
discussed round the with structural adjustment the years leading up to the
world. We should use the programmes, has led to a introduction of the World
decline in the role of govern- 7a 4 “XK Bank approach within the
opportunity to enter the
ment in health care, while. — health sector in 1993.
debate with our own
the AIDS pandemic has led"
* Next, we provide the World
approach and strategies. to a massive increase in
: Bank’s summary of its
demand-for services and a
World Development Report
decline in government
1993 on “Investing in
morale in many countries. The prevail-
Health”. It shows not only the principles
ing atmosphere is one in which the role
on which World Bank thinking on health
of private sector and market forces are
is based but also outlines the policy
wrongly seen as the only way ahead.
approaches and strategies.
There has been enthusiasm towards
Thirdly, we publish the World Health
the report on the part of some donors,
Organization’s response to the World
health professionals and national health
Bank approach to the health crisis. It
policy makers. However, many of us in
highlighttsh e need for advocates of the
the non-governmental organizations
World Bank approach to emphasize the
(NGOs) and private voluntary organiza-
role of increasing poverty when consid-
tions (PVOs), involved in advocacy for
ering health strategies, and of the need
health and justice issues, received the
for partnerships between communities,
report with considerable suspicion. We
governments and donors if health is to
have problems accepting that an
improve.
organization which was showing little
commitment to the major causes of ill- Finally, our fourth article describes how
health, namely poverty, might have to make the most of the report - to make
credible standards to prescribe or the most of the World Bank’s focus on
policies to promote for the health sector. health and to create an opportunity to
Nor are we able to accept the narrow, develop our own approach and strategy
medical perspective of the report and its for dealing with the crisis. We also begin
strictly economic analysis. According to to set priorities for action.
a CMC study on healing and whole-
Later this year, we shall publish an issue
ness, published in 1990, health is not
COVER AND ABOVE: of Contact looking at the responses to
Drawings taken from the primarily medical. The major causes of the financial crisis. In particular, we hope
Annual Report 1993, disease in the world are social, economic
World Food Programme to include articles from our readers.
contact n°141 - February-March 1995
BACKGROUND
THE BUILD-UP TO THE CRISIS
_ Health activist David Werner
presented a paper at a recent
meeting of CMC - Churches’
Action for Health on the
privatization of health care. The
following is an edited extract from
his paper entitled “Turning health
care into an investment: the latest
high-power assaults on primary
health care”. The article provides
the historical setting into which the
World Bank’s World Development
Report on “Investing in Health”
was introduced in 1993.
By the late 1970s, wide recognition that
the western medical model was failing
to adequately improve health in the Third
World led to a growing demand for
reform. In 1978 the World Health
Organization (WHO) and UNICEF
convened a global conference in Alma
Ata, Kazakhstan, former USSR.
To advance towards the goal of Health
for All by the Year 2000, the Alma Ata
declaration, endorsed by practically all
governments, called for a potentially
revolutionary approach. Primary Health
Care (PHC) was conceived as a
KASo char/WHO
comprehensive strategy that would not
Water for life:
only include an equitable, consumer- Unhappily, the high expectations of Alma
the Alma Ata conference on
centred approach to health services, Ata have not been met. Today, 17 years primary health care called for
but would address the underlying social later, it is painfully evident that the goal peoples’ basic needs to be
met.
and political determinants of health. It of Health For Allis growing more distant,
called for accountability of health workers not just for the poor, but for humanity.
and health ministries to the common Some critics say that PHC has failed.
people, and for social guarantees to Others protest that it has never really
make sure that the basic needs — been tried.
including food — of all people are met. In
Three major events have sabotaged the
recognition that socially progressive |
revolutionary essence of PHC: the
change only comes from organized
introduction of “Selective Primary Health
demand, it called for strong popular
Care” at the end of the 1970s; structural
participation. .
contact n°141 - February-March 1995
BACKGROUND
adjustment programmes (SAPs) and to the “twin engines of child survival” :
the push for cost recovery or user- ORT and immunization.
financed health services in the 1980s;
The global child survival campaign
and the takeover of Third World health
quickly won support from many health
care policy-making by the World Bank in
professionals, governments and USAID.
the 1990s. These three monumental
Itpromised to improve a widely-accepted
assaults on PHC are a reflection of
health indicator, the child mortality rate,
prevailing regressive sociopolitical and
while prudently overlooking the social
“economic trends.
and economic inequities underlying poor
Selective Primary Health Care health.
No sooner had the dust settled from the
But while technological solutions are
Alma Ata conference than top-ranking
sometimes helpful, they can only go so
health experts in the North began ttor im
far in combating health problems whose
the wings of PHC. They asserted that in
roots are social and political. Predict-
view of the global.recession and poor
ably, the child survival initiative has had
countries’ shrinking health budgets, a
less impact than was hoped. An
comprehensive approach would be
estimated 13 million children still die
impractical and too costly. If any health
each year (roughly the same number as
Some critics say that Statistics were to be improved, they
15 years ago, although the percentage
argued, high-risk groups must be
Primary Health Care is somewhat reduced). Most of these
“targeted” with a few cost-effective
(PHC) has failed. Others deaths are still related to poverty and
interventions. This new politically-
under-nutrition. In the late 1980s and
protest that it has never -Sanitised version of PHC was dubbed
early 1990s the decline in child mortality
really been tried. Selective Primary Health Care.
rates has slowedor halted and, in several
Soon compromising with this view, countries (especially in sub-Saharan
UNICEF through its so-called Child Africa) is now reversing.
Survival Revolution prioritised four
Equally disturbing has been the back-
interventions: growth monitoring, oral
sliding both in oral rehydration therapy
rehydration therapy (ORT), breast-
usage, and immunization coverage.
feeding, and immunization. Although it
ORT’s disappointing and in some
later added food supplements, female
countries diminishing impact can in part
education and family planning to this
be explained by the dependency-
limited package of health technologies,
creating, disempowering way it was
in practice and in most countries PHC
introduced.
became even more selectively reduced
Polio vaccination campaign:
In some countries, primary
health care became reduced to
oral rehydration therapy and
immunization programmes.
LTa ylor‘;WHO
2
contact n°141 - February-March 1995
BACKGROUND
From the start WHO, UNICEF and nated due to huge foreign debt and
USAID promoted factory-made packets deteriorating terms of trade.
of oral rehydration salts (ORS), thus
SAPs usually include: cutbacks in public
“pharmaceuticalizing”a simple solution
spending; privatization of government
and creating dependency on a product
enterprises; freezing of wages and
whose price and availability lie outside
freeing of prices; increased taxation;
family and community
incroef parodsucetio n
control. At first ORS
for export rather than
packets were distributed
for local consumption;
free. But when health
reducing tariffs and
budgets were slashed by
regulations and
adjustment policies,
creating incentives to
health ministries priva-
attract foreign capital
tized their production
and trade; and
and distribution.
reducing government
Today, the price of a deficits by charging
single packet of ORS is ' user fees for social
equivalent to one-fourth services, including
of the daily wages of health. Today, the price of a
some poor families.
These policies hit the single packet of oral
Since under-nutrition
D-IS> sOe poor hard. Budgets rehydration salts (ORS) is
is the predisposing AFASOL E e
for so-called “non-
SANSRSTSR N equivalent to one-fourth
(underlying) cause of
R\S,.: NS POVp roductive” govern-
death from diarrhoea, it of the daily wages of
mentinitiatives such as
Skee a os
is easy tosee how social aipS :=2 a sa ‘n Nt health, education, and some poor families.
marketing that induces
food subsidies are ruth-
poor families to spend
lessly slashed. Public
their limited food money
hospitals and health
on ORS packets may
centres are sold to the
be counter-productive
private sector, thus
in terms of lowering 2
pricing their services
child mortality. 3
out of reach of the poor.
In the last few years 3 Falling real wages, food
both WHO and §& scarcity, and growing
UNICEF havebegunto = unemployment due to
place more emphasis government layoffs all
on - less costly and join to push low-income
more rapidly and reliably available - families into worsening poverty. And ill-
home production of ORS (home fluids) health.
and continued feeding (including
World Bank claims that Third World
breastfeeding). But after a decade of
health has improved over the past 30
marketing the packets as awonder drug,
years shrewdly downplay or conceal the
itis proving difficult to reeducate people.
fact that, in many countries,
Structural adjustment and cost improvements slowed down or stopped
recovery after the mid-1980s and even more so
The next big setback to PHC was the since the beginning of the 1990s. In
introduction, during the 1980s, of struc- some, under-nutrition, tuberculosis, chol-
tural adjustment programmes (SAPs). era, sexually-transmitted diseases,
Engineered by the World Bank and the plague and other indicators of deterio-
International Monetary Fund (IMF), rating conditions have. been drastically
SAPs are a package of policies purport- increasing.
edly (supposedly) designed to assist
The World Bank and IMF are not the
the economic recovery of Third World
only international bodies to promote user-
countries whose economies have stag-
financing and cost-recovery schemes,
- contact n°141 - February-March 1995
BACKGROUND
society takes from the more fortunate to
benefit the less fortunate. It also means
that for those in greatest need, health
care is no longer a basic right.
World Bank takeover
A first reading of the World Bank’s 1993
development report “Investing in Health”
is encouraging. (Asummary of the report
appears on pages 5-8). The report
acknowledges that sustainable devel-
opment requires direct measures to
eliminate poverty and its strategy for
improving health status worldwide
sounds comprehensive, even modestly
progressive. It seems the bank has
Street children in Brazil:
turned over a new leaf.
worldwide, 100 million children along with privatization of public health
are living rough on the streets.
services. Arguing that in today’s hard On further reading we discover that,
times it sees no better alternative, under the guise of promoting an
UNICEF also promotes user-financing equitable, cost-effective, decentralised
of village health posts through the so- and country-appropriate health system,
called Bamako Initiative. Under this the report’s key recommendations spring
policy, consumers in many African coun- from the same sort of structural adjust-
tries and elsewhere are now charged ment paradigm that worsened poverty
enough for drugs to keep health posts and further jeopardised the health of the
(that would otherwise have been closed world’s neediest people in the 1980s.
due to cutbacks in health budgets)
Stripped of its humanitarian rhetoric, its
stocked and functioning. chilling thesis is that the purpose of |
The introduction of cost-
Yet studies have shown that such cost- keeping people healthy is to promote
recovery schemes (...)
recovery schemes have serious draw- economic growth. Were this growth to
means that for those in backs. When they are introduced, utilis- serve the wellbeing of all, the bank’s
greatest need, health ation of health centres by high-risk intrusion into health care might be more
care is no longer a basic groups often drops. Or just because palatable. But the economic growth it
poor families are willing to pay for medi- promotes has invariably benefitted large
right.
cines does not mean they can afford to multinational corporations, often at great
do so. They may actually be spending human and environmental cost.
their last pennies for medicine when
Broadly speaking, the “new” health policy
they need to feed their sick children. is little more than old wine in new bottles,
Moreover, when health posts are and the report the last nail in the coffin of
financed through sale of drutghes t,emp - PHC. “Turning health into investment”
tation for health workers to over- would be a better title, for the bank
prescribe is great. Also, because the takes a dehumanisingly, mechanistic,
poorest families get sick most often,
marketplace view of both health and
they carry more than their share of costs
health care.
for the health post. While Bamako has
provisions to charge the poorest of the
poor less, such safety nets work better David Werner is author of “Where there is no doctor’,
on paper than in practice. a manual which has been translated into more than 50
languages and which is used by village health workers
Whatever their short-term impact, the in over 100 countries. A fervent advocate of Primary
Health Care (PHC), he worked for many years in a
introduction of cost-recovery schemes community-based health programme in Chiapas,
has disturbing long-term social and Mexico, and is currently active in HealthWrights, a
work group for people’s health and rights based in
ethical implications. It means a retreat
Palo Alto, California.
from progressive taxation, whereby
contact n°141 - February-March 1995
REPORT SUMMARY
WORLD BANK’S VIEW OF
“INVESTING IN HEALTH”
In 1993, the World Development
Report outlined the World Bank’s
approach to health financing.
According to the leading medical
journal, The Lancet, the
publication of “Investing in Health”
marked a shift in the leadership on
international health from the
World Health Organization to the
World Bank. The report received
mixed reactions from different
sectors. Here, we reprint excerpts
from the World Bank’s summary of
the report.
Investing in Health
“Health conditions around the world have
improved more in the past forty years
than in all of previous human history,”
according to “Investing in Health”, World
Development Report 1993. Life expect-
ancy at birth in the developing world
rose from 40 years to 63 years. The
number of children who died before
their fifth birthday decreased from almost
three in ten to one in ten. Smallpox,
which killed more than five million annu-
ally in the early 1950s, has been eradi-
cated entirely.
“Yet developing countries, and es-
pecially their poor, continue to suffer a DMiPsRsKi on/Geneva
Health In later years:
heavy burden of disease, much of which birth claim the lives of about 400,000
World Bank points out that
can be inexpensively prevented or women each year in developing life expectancy at birth has
cured,” writes World Bank President countries* where maternal mortality increased to 63 years.
Lewis T Preston in a foreword to the ratios are up to 30 times higher than in
report. Child mortality rates in the poorest high-income nations.
countries today are about ten times * World Health Organization
“Millions of lives and billions of dollars estimates that500,000 women
greater than those in the richest nations.
could be saved,t”h e report argues, even continue to die each year as a
Complications of pregnancy and child- result of the complications of
in the face of three major health chal- pregnancy and childbirth.
contact n°141 - February-March 1995
REPORT SUMMARY
lenges over the next few decades: the - A cost explosion in some middle-
aging of populations, AIDS and drug- income developing countries, resulting
resistant strains of disease. The report from rising numbers of physicians,
proposes that governments adopt a new and expensive medical technolo-
three-pronged policy approach to health gies and the link between expanding
reform: health insurance and fee-for-service —
payments to physicians.
- foster an enabling environment for
households to improve health; Policy recommendations
Since overall economic growth and edu-
- improve government spending in
cation contribute to good health,
A high priority for health; and
governments should pursue sound
government spending - promote diversity and competition in macro-economic policies with a pro-
should be a limited the provision of health services. poor focus and expand basic schooling,
package of public health Problems of health systems especially for girls. They should sharply
redirect spending from the top levels of
There are major problems with health
measures and essential
the health system to basic public health
systems that will slow the pace of
clinical interventions, the
programmes such as immunization and
progress in reducing the burden of pre-
report declares. AIDS prevention and essential clinical
mature mortality and disability. These
services such as family planning and
flaws also will frustrate efforts to respond
treatment for tuberculosis. Governments
to new health challenges and emerging
disease threats. They include: should foster competition in the supply
of health inputs, such as drugs and
- Misallocation of public resources by
equipment. They should encourage a
spending on health interventions with
wide range of organizations, including
low cost-effectiveness while critical
non-governmental agencies and private
and highly effective programmes are
doctors and hospitals, to provide health
underfunded.
services. Government regulation of
Inequity, reflected in the dispropor- privately delivered health services is
tionate amount of government also required to ensure safety and
spending that benefits the affluent quality. Regulations of public and private
while the poor lack access to basic insurance is needed to achieve broad
health services and receive low-quality coverage of the population and to
Care. discourage practices that lead to over-
use of services and escalation of costs.
Inefficiency in the choice of pharma-
ceuticals, in the development and Increasing the income of those in poverty
supervision of health workers and and is the most efficacious (successful) eco-
A slave to the colourful little in the utilization of hospital beds. nomic policy for improving health, the
pills? Let's learn to use them in report asserts, adding that the poor are
moderation.
most likely to spend additional income
on improving their diet, obtaining safe
water and upgrading sanitation and
housing. Even without income growth,
health promotion can be achieved by
expanding schooling, since better-edu-
cated people seek and utilize health
information more effectively than those
with little or no schooling. Schooling of
girls is particularly beneficial, in view of
the pivotal (influential) role of women in
household nutrition, health care and
hygiene.
Public health and essential
services|
A high priority for government spending
WHO
contact n°141 - February-March 1995
REPORT SUMMARY
JS chytte/UNICEF
Delivering a baby in a clinic in
should be a limited package of public require a redirection of current public Mauritania: essential clinical
care in all countries should
health measures and essential clinical spending for health. In low-income
involve at least prenatal and
interventions, the report declares. The countries, it will require some combina- delivery care.
most cost-effective public health tion of higher spending by governments,
activities include immunization, school- donor agencies and patients along with
based health services, information about a reorientation of existing health
family planning and_ nutrition, expenditure.
programmes to reduce tobacco and
Reorienting spending on health
alcohol consumption, and AIDS
In many countries public investment
prevention. Essential clinical care in all
and spending are concentrated unduly The minimum package
countries should involve atleast prenatal
onhighly specialized services, facilities,
could cost as little as
and delivery care, family planning, basic
training and equipment, despite the fact
care of the sick child and simple treat- US$1 2 per,person
that the most cost-effective public health
ments for tuberculosis and sexually- and clinical interventions are best deliv- annually in low-income
transmitted diseases.
ered at the level oft he district hospital or countries ... [but] it
This minimum package could cost as below. Public policy can play a useful
would require a 3
little as US$12 per person annually in role in redressing the imbalance. Inter-
quadrupling of |
low-income countries and reduce the national aid for health in recent years
current burden of disease by about 25%. has shifted away from hospitals and expenditure on public
Adoption of the package in all developing high-technology curative medicine health.
countries would require a quadrupling toward primary and preventive care, but
of expenditures on public health, from more can be done.
US$5 billion at present to US$20 billion ‘
By reducing spending on services
annually and an increase from about
outside the national package, govern-
US$20 billion to US$40 billion in
ments can concentrate on providing
spending on essential clinical services.
essential care to the poor. Spending
In middle-income countries, this will
can be reallocated by increased cost
contact n°141 - February-March 1995
REPORT SUMMARY
recovery, especially by charging the ¢ Governments are increasingly recog-
wealthy for services in government nizing the centrality of their own role in
hospitals. Another step would be to public health.
promote unsubsidized health insurance
¢ They are exploring ways to introduce
for middle- and upper-income groups.
more competition and private sector
The explosion in health expenditures
involvement in the delivery of clinical
now facing many countries can be
services.
Countries willing to _avoided by government encouragement
of competition among providers and ¢ New approaches to finance and insur-
undertake major reforms
prepayment to care-providing institu- ance are being examined which ensure
in health policy should be
tions, dissemination of information on broad coverage of the population,
strong candidates for providers’ prices and insurers’ products avoid public subsidies for the affluent
increased external and in some cases, setting limits on and control health care spending.
compensation of physicians and
assistance, the report Reform is difficult, however, since an
hospitals, the report states.
array of interest groups may stand to
argues, including donor
Greater reliance on non-governmental lose and because many of the changes
finance of recurrent
organizations and the private sector to will require the development of new
costs. deliver clinical services can help to institutional capabilities. Nevertheless,
improve quality and raise efficiency, the the report observes, a number of devel-
report maintains. Atthe same time, much oping countries have shown in recent
years that broad reforms in the health
canbe done to increase the efficiency of ©
government health services through ' sector are possible when there is
decentralization and competitive sufficient political will and when changes
procurement of drugs, equipment and .to the health system are designed and
non-medical services. In the areas of implemented by capable planners and
health insurance, government regulation managers.
is important to prevent discrimination
Countries willing to undertake major
against those with high health risks, to
reforms in health policy should be strong
assist cost containment and to focus
candidates for increased external
spending on cost-effective interventions.
assistance, the report argues, including
Reform and aid donor finance of recurrent costs. An
“The world’s diversity of health care increasing number of donors, including
systems is matched by the diversity of the World Bank, which has quadrupled
reform movements,” the report notes its lending for health over the past six
and cites some common themes of years, are now supporting these broad
reform: reforms. Stronger donor coordination
Village health centre in would improve the effectiveness of aid.
Padgha, India.
An increase of US$2 billion annually in
donor assistance —raising health’s share
of total official aid from 6% to 9% — is
needed to improve services to the poor
and to help control such diseases as
tuberculosis and AIDS.
If developing countries and donors
embrace the key health policy reforms
contained in the report, improvements
in human welfare in the coming years
will be enormous. A large share of the
current burden of disease — perhaps as
- much as one-fourth — will be prevented.
And people around the world, especially
the more than one billion people now
living in poverty, willlive longer, healthier
and more productive lives.
AK ochar/WHO
contact n°141 - February-March 1995