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Health financing, social protection, maternal and child health, aid effectiveness, impact evaluation
Victoria Fan is a research fellow at the Center for Global Development. Her research focuses on the design and evaluation of health policies and programs as well as aid effectiveness in global health. Fan joined the Center after completing her doctorate at Harvard School of Public Health where she wrote her dissertation on health systems in India. Fan has worked at various nongovernmental organizations in Asia and different units at Harvard University and has served as a consultant for the World Bank and WHO. Fan is investigating health insurance for tertiary care in Andhra Pradesh, conditional cash transfers to improve maternal health, and the health workforce in India.
The quality of health services in many developing countries is poor, traditionally leading to calls for greater resources to be devoted to service provision. To better align provider incentives with patient and population health, policymakers are increasingly using pay-for-performance schemes to improve health service delivery.
At this CGD seminar, Marcos Vera-Hernández will discuss research comparing the use of budget resources and incentives for reductions in student anemia across 130 Chinese rural primary schools. In this context, findings show that increasing budget resources is modestly more effective than using incentives (although incentives may be more cost-effective). The two interventions function as substitutes – and strikingly, anemia reductions are smaller when incentives and budget supplements are combined than under budget supplements alone. Despite increasing policy interest in performance-based financing, these findings demonstrate limitations in its use and highlight the importance of considering context.
A tremendous amount of radioactive products were discharged as a result of the accident in the Fukushima nuclear power plant in March 2011. When describing the geographical distribution of radioactive contamination, the government, media, and other organizations largely used administrative boundaries (prefectures, municipalities etc.) or distance from the radiation source as a reference.
In this CGD seminar, Hiroaki Matsuura will discuss how this sometimes misleading information about risk, rather than actual risk of radiation, significantly and negatively affected land and other prices in locations near the plant. Although risk information based on administrative or other general boundaries has an obvious advantage of distilling large and complex risk information, the government, media, and other organizations fail to recognize the potential economic effects of misclassifying non-contaminated areas into the contaminated prefectures.
This report offers a strategy for the Global Fund to get more health for the money by focusing more on results, maximizing cost-effectiveness, and systematically measuring performance throughout its operations.
FOR IMMEDIATE RELEASE
Experts Urge Global Fund for AIDS, TB and Malaria: “Buy More Health for the Money”
Report Highlights Shortcomings, Shows How to Save Many More Lives
The Global Fund to Fight AIDS, Tuberculosis and Malaria disburses more than a billion dollars a year and has likely saved millions of lives-but it could
save many more lives and avert untold suffering by re-structuring its activities to get more health for the money, according to a new report from the
Center for Global Development (CGD).
MoreHealthfortheMoney.org (interactive summary)
Despite the Global Fund’s achievements in the eleven years since it was created, an estimated three million people die each year from the three diseases
that it was set up to combat. The report, More Health for the Money: Putting Incentives to Work for The Global Fund and Its Partners, calls reducing that toll as much as possible with the money available a “moral imperative.”
“The Global Fund could save many more lives if they are willing to change how they do business to focus more on results and less on receipts,” says Amanda
Glassman, director of global health policy at the Center for Global Development and the lead author of the new working group report.
“Getting more value for the money is not merely a checklist, a principle or another task on the to-do list-it is the core business of any health funder.
Our report explains how the Global Fund can do that,” Glassman adds.
Foreign assistance for health has reached historic highs in recent years, largely due to the growth of the Global Fund. From 2002 to 2011, the Global Fund
disbursed $15.5 billion to support more than 1,000 programs in over 150 countries. This year the United States alone pledged over $1.6 billion to the
Global Fund, more than it gave to the World Bank, the regional development banks, and other multilateral channels combined.
But with tight budgets and sluggish economic growth in the high-income economies, continued rapid increases in global health assistance are considered
unlikely, so attention is turning to getting the most from the money already on the table.
Mark Dybul, head of the Global Fund and the former director of the US anti-AIDS program, PEPFAR, wrote in a recent Global Fund blog post: “We must make our
money count. Great investments are effective and efficient. In order to raise the money we need for global health we need to demonstrate to everyone that
this money is put to excellent use.”
According to More Health for the Money, the Global Fund has plenty of room for improvement:
The Global Fund subsidizes the purchase of a wide variety of mosquito nets-with some costing up to several times more than others-without clear
evidence to show which if any of the more expensive brands are worth the extra money.
In more than a dozen countries in Africa, the Global Fund pays about $50 to supply a patient with a year’s worth of a widely used anti-AIDS drug.
But in Iran, Albania and the West Bank and Gaza, it pays more than $1,000 for the same amount of the same drug.
Global Fund AIDS prevention money is often spent on raising general awareness rather than providing people most at risk with the means to avoid
infection. In Costa Rica an estimated 60 percent of AIDS cases occur among men who have sex with men, but just 1% of the country’s spending on prevention
is targeted to this high-risk group.
First-line medications are much more cost effective than the second- and third-line medicines given when first-line medications fail. Nonetheless,
the Global Fund subsidizes second- and third-line medications in several low-income countries even though many people there are dying for lack of
Members of the working group that prepared the report include experts from a wide range of disciplines, countries and organizations. They concur that by
focusing on outcomes and strengthening incentives, the Global Fund, its partners, and other global health donors can correct these and other problems.
“The changes we recommend, while seemingly small and bureaucratic, can make a revolutionary difference for the Global Fund,” says working group member Yot
Teerawattananon, the director and senior researcher at the Health Intervention and Technology Assessment Program in Thailand. “Focusing on results-based
interventions, cost effectiveness, and performance metrics will be an important step towards ensuring that the billions of dollars spent by the Global Fund
are getting the greatest value for money.”
Working group member Karl Dehne, a UNAIDS official, says that with the new funding pledges “the Global Fund has the capacity to make a significant,
measurable impact on the global health landscape - but only if administrators keep their eye on preserving value for money. This report presents ways to
ensure that all the additional resources get the largest possible bang for the buck.”
“The work of the Global Fund has been admirable - but it can do much better,” says CGD president Nancy Birdsall. “The changes the report recommends are not
easy in any bureaucracy. But the Global Fund has been a pioneer since its inception, and many of the ideas in this report are already on the agenda of the
Fund’s new leadership, its own funders, and the global health advocates that have been the bedrock of its support and effectiveness. I am optimistic.”
The report offers a four-part strategy to get more value for money. While each step corresponds to a different part of the Global Fund’s grant making
process, the issues and sequence are common to all funders-as are the suggested solutions:
Allocation: The Global Fund has relied upon a passive approach to grant allocation, responding to country requests. Lacking clear budget constraints, and rewards for
efficiency, or predictable funding opportunities, countries maximize their funding requests, leading to inefficiencies and overspending.
Moving forward, the report recommends that the Global Fund create a menu of effective and cost-effective options from which countries could select what they
need. Menu options should include activities that focus prevention and treatment on people at greatest risk from the diseases.
Contracts: As contracts are currently designed there are few incentives for demonstrating program impact and few penalties for failing to do so.
Moving forward, the experts in the working group urge the Global Fund to align funding with incentives for effective action. Linking funding to outcomes within contracts
will encourage recipients to meet goals rather than merely implement programs. For example, with proper monitoring and testing, a contract could pay for a
reduction in the number of new HIV infections, rather than for inputs such as condoms or counseling.
Cost and spending: The missing piece in most contracts and programs administered by the Global Fund is the unit cost of services delivered - such as the cost of
successfully treating one person with tuberculosis-an elusive but critical piece of information.
Moving forward, the experts suggest the Global Fund track this information and, whenever possible, write the information into contracts. The agency can also share and
publicize the information with partners and the public to reduce costs.
Performance and verification: The adage suggests that what gets measured gets done - and current measurement tools employed by the Global Fund are weak and inaccurate.
Moving forward, experts advise the Global Fund to identify new, more rigorous tools to measure impact and hire an independent third party to verify the accuracy and
quality of results. This way, the Global Fund and international health donors can be sure that their funding was used to produce positive health results.
CGD president Nancy Birdsall adds:
“This report has practical ideas for all funders of global health programs, indeed for all outside funders of social services in developing countries, of
how to incorporate into their business practices sensible incentives - for themselves and for grantee countries - to minimize costs and maximize results on
Working Group Chair and report author Amanda Glassman, who is also a CGD senior fellow, adds:
“Value for money is not about reducing costs or cutting budgets, but rather about maximizing the health impact of every available peso, pound, or pula to
reduce human suffering and save lives.”
A companion website, www.MoreHealthfortheMoney.org offers a quick and interactive way to read and share
the report’s findings. The site features a short video and digital briefs that highlight key messages and recommendations from the report, many illustrated
by expert commentary and interactive graphics.
“Human development is at the core of development. We hope this forum will substantially push forward health cooperation between China and Africa.”
Why does this matter? Since 2000, China has hosted six ministerial Fora on China-Africa Cooperation (FOCAC), held every three years, in which health is but one of many areas of attention. In the last FOCAC, the accompanying Beijing Action Plan for 2013-15 listed cooperation in many areas – 6 in political, 9 in economic, 6 in cultural, and 6 in development – of which ‘medical aid and public health’ is one. And, while official figures are hard to come by (see paper by my colleague Vij Ramachandran), it is likely that health has played only a minor role in China’s development assistance to Africa. This inaugural forum on health and Beijing declaration may well mark a turning point in the history of Chinese development and health cooperation to Africa. China’s top-level leadership clearly sees the political, economic, and perhaps health importance of global engagement especially in Africa.
What did I like about the Declaration? I liked the shout-out to “universal coverage of health services”, “sustainable, long-term health solutions”, “support strengthening of health information systems”, and the focus on vaccine-preventable diseases. I also like how “universal coverage of health services” in Chinese translates to an explicit focus on covering all people of some set of health services (卫生服务的全民覆盖). Universal health coverage has been a recurring theme both in China’s recent major health reforms and at the WHO led by Margaret Chan (see picture). This focus on universal health coverage and, to some extent, on health systems appears to be a marked distinction from the previous Beijing Action Plan.
Chinese president Xi Jinping (left) meets with the director general of the World Health Organization (WHO) Margaret Chan (right) on 20 August 2013 in the People’s Great Hall in Beijing, China. Source
And there were other things in Chinese, with its typical metaphorical style, that were endearing, like “中非友好源远流长，历久弥新” which was generically translated to “China and Africa enjoy a sustainable friendship for a long time”, but it conveys a feeling of a long flowing river of history, old yet constantly new. In the related news, there was repeated emphasis on mutual benefit, win-win, and equal partnership (平等互利、合作共赢), all echoing Mr Deng Xiaoping’s early principles of foreign engagement.
Second, even with the Declaration’s greater attention to universal health coverage, the Declaration and the Action Plan still risk focusing excessively on providing ‘things’ – sending medical teams, drugs, prefabricated clinics (yep, that’s there too). There’s nothing wrong with focusing on these inputs per se, but there are risks. First, temporary inputs from China, particularly health workers, are just that – temporary. Once they depart or stop flowing in, the system reverts back to what it was previously. Even if the Chinese medical team can build capacity of local physicians or nurses through their visits, such training may tend to focus on tertiary care, which will not reduce major causes of disease in many African countries.
More critical, however, is that a focus on inputs does not necessarily consider the incentives, the systems, and the health outcomes. Are these particular inputs, eg, medical teams, what is needed to improve health status in a particular African country? It’s not obvious. The Chinese should remember and learn the difficult lessons from their own history of health care, recognizing that their “barefoot doctors” provided services in a system with different incentives – through its Cooperative Medical System. In order to realize its aspiration of “sustainable, long-term solutions,” Chinese officials need to put more attention on the incentives within an African health system, the local governance structures, and local health information systems. Without that, all these things may at best be one-off tokens of goodwill, or worse, it may leave a trail of Chinese products and buildings that are ultimately unused and empty. China should consider other options besides input-based aid and instead look to cutting-edge aid tools such as performance-based financing or Cash on Delivery Aid.
In addition, the Declaration had zero mention of China’s complex aid architecture. China, like the United States, already has a hodgepodge of national-level agencies involved in international cooperation including its health ministry (now called the National Commission on Health and Family Planning). But unlike the United States, the Chinese government has increasingly decentralized foreign affairs to the province level. My coauthor Gordon Shen presented our working paper on China’s provincial diplomacy for health, during the China-Africa Health Young Leaders Roundtable, which coincided with last week’s events. The paper describes the role of Chinese province to African country relationships in health cooperation (for example, Fujian-Botswana, Henan-Ethiopia, etc.), the implications of locked pairings, and how to improve the allocation of such pairings. While lacking data, our paper overall suggests a historical role of provinces in China’s global health diplomacy, which adds another layer of complexity in an already complex aid architecture.
Finally, readers may naturally ask – what about the financial commitments with this Beijing Declaration? This is important. But the problem is that, because of China’s multi-actor and decentralized aid architecture, it is not surprising that even the Chinese national government hardly has a clue of the size of resources being invested to Africa for health. I wrote a blog on this, and the problem still persists. It’s hard to make pledges to increase aggregate commitments if one doesn’t even know what one’s baseline or historical disbursements.
Bottom line: wait and see. To where will the long and flowing river of China-Africa cooperation lead?
Dr Victoria Fanis a research fellow and health economist at the Center for Global Development. The author thanks Lincoln Chen, Yanzhong Huang, LIU Peilong, Jenny Ottenhoff, Gordon Shen, and TANG Shenglan for helpful comments. You can follow her on twitter at @FanVictoria
Performance-based financing can be used by global-health funding agencies to improve program performance and thus value for money. The Global Fund to Fight AIDS, Tuberculosis and Malaria was one of the first global-health funders to deploy a performance-based financing system. However, its complex, multistep system for calculating and paying on grant ratings has several components that are subjective and discretionary. We aimed to test the association between grant ratings and disbursements, an indication of the extent to which incentives for performance are transmitted to grant recipients.
Mosquito-zapping lasers, refrigerators for vaccines, and disease modeling: these are the three impressive technologies featured in a TED talk by Nathan Myhrvold. On the first two technologies, I responded in a piece “When engineering met public health” in the Huffington Post. What I didn’t get a chance to talk about was the importance of his third technology – disease modeling:
“One of the problems that you have if you're trying to eradicate malaria or reduce it is you don't know what's the most effective thing to do. Okay, we heard about bed nets earlier. You spend a certain amount per bed net. Or you could spray. You can give drug administration. There's all these different interventions but they have different kinds of effectiveness. How can you tell? So we've created, using our supercomputer, the world's best computer model of malaria, which we'll show you now…”
“By doing these kinds of simulations, we want to eradicate or control malaria thousands of times in software before we actually have to do it in real life; to be able to simulate both the economic trade-offs -- how many bed nets versus how much spraying? -- or the social trade-offs -- what happens if unrest breaks out?
Without a doubt, this software may well be a more powerful technology than a laser zapper or a vaccine refrigerator. Myhrvold notes that the disease modeling software developed by Global Good now informs eradication strategies for polio, HIV/AIDS, tuberculosis and malaria.
We can’t be more supportive of this work, an issue we’ve supported in our CGD Working Group on Value for Money in Global Health. In the Planning Allocation chapters in our More Health for the Money report, we recommend the Global Fund “optimize investments for greatest health impact.” True, the Global Fund is beginning to move in this direction, with its greater focus on targeting programs and grant-funded interventions to key populations. But the Global Fund can do much more by requiring that its recipients systematically consider intervention effectiveness, costs, environment, and other factors into a model, however simple or complex, to maximize health impact.
Detractors will say that these models are too hard, the data aren’t available, and recipients don’t have the technical capacity. But the data requirements for these models are not onerous or burdensome, nor do they need to involve Myhrvold’s supercomputers. Dr Tim Hallett, a reader at Imperial College London, found that impact could increase by 20%, simply by redirecting the same resources to the populations at greatest risk of infection and transmission. Simpler modeling tools producing “good-enough” decisions on how to allocate national resources are needed and are being developed by various groups – and the Global Fund should tap into these activities.
In the meantime, the Global Fund can encourage applicants to talk with networks and organizations such as Myhrvold’s and Hallett’s as well as the various disease modeling consortia (see here, here, and here) to make sure that proposed plans are good value for money. That can start a conversation where ultimately more lives will be saved and more people will benefit. When done appropriately, countries using more information and data can better target their interventions to the right populations and ultimately control, if not eliminate, their epidemics.
Victoria Fan is a research fellow and health economist at the Center for Global Development. She thanks Amanda Glassman, Jenny Ottenhoff, Justin Sandefur, and Huffington Post for their inputs. You can follow Victoria Fan on Twitter at @FanVictoria.
This is the data set for Policy Paper 31, in which Victoria Fan, Denizhan Duran, Rachel Silverman, and Amanda Glassman analyze data on the Global Fund performance-based financing system to test the association between grant ratings and disbursements.
In his early days as India’s new prime minister, Narendra Modi has shown remarkable leadership in all sectors, including health, for which he’s articulated his vision to create a Swasth Bharat, a Healthy India. Combined with two major policy windows—the proposed restructuring of the Planning Commission and the report of the 14th Finance Commission expected by the end of the year—the policy reforms under the ruling National Democratic Alliance (NDA)’s mandate of “Universal Health Assurance for All” have the potential to be a game-changer for India’s neglected public health system.
India’s health system has many problems but perhaps the most obvious is its persistently low levels of public financing for health, with often limited health outcomes. With only 1.7 percent of its GDP being spent on health expenditures (including sanitation and nutrition), India spends roughly $15 per person for health each year. As a result, up to 75 percent of health care expenses are borne out of pocket by patients. And given the lack of any mechanism to insure against health risks, much of India’s low-income population has to forego necessary healthcare or is forced into bankruptcy because of the inability to pay when confronted with a severe medical condition.
One critical policy lever that could have an impact on Indian public health expenditure and its effects on health outcomes is the financial flows and incentives from central government to states. India’s center-to-state fiscal transfers have occurred through three channels—Finance Commission; Planning Commission; and Centrally Sponsored Schemes—with at least three crucial characteristics (see figure 1):
Are the allocations based on a formula and objective criteria or not?
Are there conditionalities associated with those transfers?
Who does the money go to?
While health is a ‘state’ subject, the central government has exerted significant influence on health financing through the flagship scheme known as the National Rural Health Mission (NRHM) from 2006–07 onwards. NRHM has now been extended to cover urban areas under the National Health Mission (NHM) umbrella. However, a systematic assessment of the impact of the three channels of transfers at the state level has not been attempted until now.
Over the past year, the Center for Global Development and the Center for Policy Research’s Accountability Initiative (in Delhi) have conducted research on intergovernmental fiscal transfers to improve health in India. As an early step we commissioned a background paper that describes and analyzes the myriad of channels and mechanisms of center-to-state fiscal transfers that could affect health outcomes. See a draft of the background paper here.
Source: Budget Documents, Government of India, 2014–15
Building on this background paper, Accountability Initiative and CGD have jointly pursued several areas of research to better assess the consequences and effectiveness of these different channels of funding—between Planning Commission and Finance Commission, within the Finance Commission, and the ‘Centrally Sponsored Schemes’ for health. In December, we are convening a working group to discuss some of our early findings and policy recommendations.
India’s finance minister Chidambaram recently announced that Anil Swarup, the leader behind the Ministry of Labour’s health insurance program for the poor, was assigned as the head of a panel to identify and get results for 215 large and long-stalled projects. While this big news of Swarup’s transfer was anticipated, just five years ago it was hardly imaginable that Swarup and his team would start India’s health insurance program for the poor – Rashtriya Swasthya Bima Yojana (RSBY) – and grow this fledgling to be one of India’s increasingly important vehicles of social protection and health coverage. While the evidence on RSBY is still developing, early results are encouraging: increased health care utilization and hospitalization; some indication of reduced out-of-pocket payments for healthcare; and a means of identification with a clearly linked entitlement (see here).
In a new essay, I explore several of the key features of RSBY’s early success – including the right leadership, the novel and systematic use of information and biometric technology, the aligning of incentives for hospitals and insurance companies, the smart use of additional payments rather than targets, and a constructive state-to-center relationship.
While Swarup’s departure from RSBY represents a unfortunate loss, RSBY’s future remains promising, particularly as it experiments with the expansion to include outpatient services, the progressive inclusion of other populations (not only those below the poverty line), the use of the RSBY smart card platform for other public welfare benefits, and the use of the rich data for disease surveillance.
But RSBY also faces many formidable operational challenges ahead for which it has received considerable criticism: the challenge that all public programs in India face of educating its beneficiaries, improving targeting, and improving the quality of care.
Moreover, as Indian programs are notorious for stagnation after losing critical leadership, greater attention to the institutions, human resource management and incentives are needed to ensure continuous improvement. It remains an open question of how effectively Swarup’s successor can maintain the great progress already achieved by RSBY.
Finally, universal health programs in all countries must control costs and get better value for money as citizens grow wealthier and increase their demand for health care. In India too, amidst inevitable growth in health-care expenditures, RSBY will need to expand its benefit package to meet evolving demand, all while ensuring smart, efficient, and sustainable public spending. In the near future, India will need to design and implement fair priority-setting institutions to ensure that public dollars for health are spent in the most cost-effective and equitable manner. My colleagues Amanda Glassman and Kalipso Chalkidou have proposed an agenda to improve priority setting, which offers instructive advice for RSBY and the Ministry of Labour & Employment.
RSBY has an exciting future with many challenges ahead and much work ahead of it. The dream of access to affordable, quality health-care is not yet realized for many more millions of Indians. I welcome your comments on my essay publicly (below) or privately.
Victoria Fan is a research fellow at the Center for Global Development. Follow her on Twitter at @fanvictoria.
“For though change is inevitable, change for the better is a full-time job.”
When Adlai E. Stevenson made this statement in 1956 he wasn’t thinking about healthcare. But it is actually a good summary of historical trends in health spending, which we analyzed recently in “The health financing transition: A conceptual framework and empirical evidence” (also available here as a CGD Working Paper). It is almost inevitable that health spending will rise in most countries, but the character, efficiency and equity of that spending are something we can alter – if we take that full-time job seriously.
In the paper, we show that health spending in most countries is very likely to increase – and for some very good reasons. Most countries are experiencing rising incomes, people are living longer, and medical care technologies continue to expand. In other words, much of that money is buying more health. It is also likely, but hardly inevitable, that most of that increased spending will be channeled through taxes or insurance premiums rather than out-of-pocket. If countries work for that to happen, health spending will be less burdensome to the sick and the poor.
These two common trends – a rise in per capita health spending and a decline in the share out-of-pocket spending – comprise what we describe as a “Health Financing Transition.” Just like the demographic and epidemiological transitions, the health financing transition provides a conceptual framework for thinking about long term trends which are not inevitable but still remarkably widespread. Like these other two transitions, timing varies for different countries regarding when they start the transition and how quickly they move through it. They may even regress. Some of the determinants are influenced by economic or technological factors but others can be affected by public policy.
This can be illustrated by looking at a particular country. According to WHO, Myanmar is among the countries that spend the least on health – about US$18 per capita in 2011. It is also among those countries with the highest shares of out-of-pocket spending – over 80% of that money is paid by individuals when they are sick and need health care services rather than as insurance premiums or taxes when they’re feeling well.
Yet, Myanmar has demonstrated that it is like many countries in the way its health care spending is evolving. Even before it made its recent commitment to move toward Universal Health Coverage by 2030, Myanmar was increasing its per capita spending on health and reducing its reliance on out-of-pocket expenditures (see Figure 1).
Source: Author’s calculations from World Health Organization data.
In our paper, we showed that this trajectory is apparent among wealthy countries over the past half century and discernible in a majority of countries over a 15-year period for which data is available
The first part of the Health Financing Transition – rising per capita health spending – is extremely likely in most low- and middle-income countries for perfectly sensible reasons. More people are earning more income and as their incomes rise, they will seek out medical care that was previously unaffordable or inaccessible. The literature demonstrates that health spending is substantially driven by rising income, to a lesser degree by population aging, and additionally by some combination of prices, technologies, and institutional change. Public policies can influence how that money gets spent by regulating private providers, structuring health insurance options, or providing public health care services.
The second part of the health financing transition – the declining share of out of pocket spending – is less predictable because it depends more directly on public policy. In our analysis, the out-of-pocket share of total health spending was not related to changes in income. It was, however related to changes in a country’s mobilization of public revenues which we interpret as demonstrating the importance of public policies in reducing out-of-pocket spending. We also found a small secular downward trend in the out-of-pocket share which may reflect the ubiquity of social movements – from Ghana to Myanmar – which want to protect people from having to pay for care when they are sick and most vulnerable. Historical accounts provide plenty of evidence to support such a hypothesis.
Countries progress more rapidly through the health financing transition when the pooled share of health spending (i.e. money for health care that is paid through insurance premiums or taxes) is rising faster than out-of-pocket spending. This diagram from our paper shows that countries like Colombia and Thailand moved rapidly along this trajectory between 1995 and 2011; countries like Brazil and India moved slowly; and countries like the Philippines and Uzbekistan regressed.
The last decade in Myanmar puts it firmly in the lower right quadrant of this diagram – countries that are progressing rapidly through the health financing transition. But this progress is not inevitable. While pressures for rising health spending are going to continue, progress on increasing the share of pooled spending will require public commitments and good policies. For countries like Myanmar, the commitment to universal health coverage is a commitment to continue to spend more on health and to finance it with pooled funds. Whether it stays on this trajectory or not is in their hands … and it is a full-time job.
A new report by the World Health Organization argues that the poor should be prioritized under universal health coverage (UHC). To that end, the WHO makes three arguments:
(1) wider pooling to share risks and reducing fragmentation of benefit packages within countries;
(2) using health aid for domestic pooled resources rather than vertical programs (of global health funding agencies); and
(3) encouraging civil society to see efficiency improvements as a means to save more lives rather than cut budgets. (sounds familiar!)
No disagreements on points (1) and (3), but (2) seems to raise more questions than answer them.
First, does health aid, pooled or not, predominantly reach the poor? Consider health aid for AIDS, malaria, and TB, which makes up about 44% of all health aid globally. Malaria and TB generally affect people of lower socioeconomic status, so perhaps aid for these diseases does reach the poor. However, AIDS appears to exhibit a paradox, such that in wealthier regions/countries, poorer individuals are more likely to be infected with HIV, whereas in poorer regions/countries, wealthier individuals are more likely to be infected with HIV (see here). Our More Health for the Money report argues for better targeting of resources, both of interventions and key populations, but for disease control purposes. So even if AIDS is concentrated among the richest, in fact it would be necessary to target that population to control an epidemic.
But more broadly, the institutions that fund these three diseases have been slow at targeting overall. In our own work, we found it impossible to say to whom, for example, the Global Fund’s resources were targeted in country (see our paper on this). But even as the WHO (unusually) declares that vertical health aid does not reach the poor, consider the alternative: can the WHO can say whether its funding, more “pooled” and “horizontal” and aimed at “health systems,” really benefits the poor more than the Global Fund or other agencies? I would argue that we have no idea.
Second, telling vertical global health donors to pool their funds would be nice for all sorts of benefits, including perhaps better coordination of resources to target to the poor. But it’s not politically feasible, particularly since these donors have all sorts of mandates to achieve a variety of results, which could be much harder to do in a pooled fund. Further, these funders have institutions and interests to continue fundraising, for their diseases and for their institutions.
Perhaps resigned at the status quo, WHO therefore says that “donors working to support health financing should therefore be mindful of the impact their work has on the population as a whole, and particularly the poor and otherwise vulnerable, rather than being solely focused on their project’s immediate beneficiaries.” But will more mindfulness help the sprawling state of the global health family and lead to more cooperative actions among donors—and ultimately prioritize the poor or at highest risk of a disease? Our More Health for the Money report found cases where there was little knowledge by one funder of another funders’ programs—in the same country. There is very little knowledge to be mindful about.
So I’d argue that policies to coordinate and pool information are crucial—as a minimum before pooling money. So I’m encouraged by a recent glimmer of intentions to try to create a “one-country platform” for information and accountability, thereby reducing a “burden of global reporting” (see here). That in turn might lead to better coordination (and a greater focus on the poor, maybe?).
Perhaps that group will also take a clue from GAVI which is working to improve their information systems, though in a rather lonely way (see my post here). Amanda Glassman and colleagues have also been at work on Data for Development initiative, to improve all the bad and fragmented data funded by donors. And maybe then, there will be more momentum to move towards pooled funding, something previously proposed under the Health Systems Funding Platform, which admittedly has never really taken off.
Finally, missing from all three points is perhaps the most central challenge of achieving universal health coverage, which can undoubtedly help target the poor better: expansion towards UHC necessarily requires selectivity. Countries have to choose who benefits and for what, first. In other words, countries have to set priorities, and those priorities can include the poor or those at highest risk. In fact Amanda Glassman along with Kalipso Chalkidou of NICE International, has a report on priority setting. Why didn’t the WHO even mention institutions for priority setting as part of the core for ensuring that UHC benefits the poor?
Victoria Fan is a research fellow and health economist at the Center for Global Development. The authors thank Jenny Ottenhoff for helpful comments. You can follow Victoria Fan at @FanVictoria on Twitter.
Recently, the American Journal of Tropical Medicine & Hygiene published a paper by Shepard et al. evaluating the impact of HIV/AIDS funding on Rwanda’s health system. The headline of the press release was catchy and assertive: “Six-year Study in Rwanda Finds Influx of HIV/AIDS Funding Does Not Undermine Health Care Services for Other Diseases. Study Addresses Long-standing Debate about Funding Imbalances for Global Diseases.”
But after reading the report, we quickly assessed that a more accurate and appropriate press release headline for this paper would be “Some Differences Observed in General Healthcare Delivery between Facilities with and without HIV/AIDS Services in Rural Rwanda.” The study has serious limitations associated with its design and its generalizability that aren’t reflected in its catchy press release, and thus have unfortunately gone unrecognized. And because there is, in fact, an important and “long-standing debate about funding imbalances for global diseases” that this study does not sufficiently address, it’s important to examination the shortcomings of the study’s results:.
1. Internal Validity: Does the study do what it claims to do?
No. Treatment was not randomly assigned, while matching and control strategies do not mitigate the effects generated by non-random assignment. As a result, the study’s current comparisons between the treatment and comparison groups are problematic in validly testing the proposed hypothesis.
The paper analyzes a “randomly selected” intervention group of 25 health centers that provided HIV/AIDS services, which is then “perfectly matched” to a control group of 25 health centers that did not offer HIV/AIDS services. But in reality, the intervention group was “randomly” selected only in the sense that the authors chose to study them, not that the health centers in the intervention group were randomly assigned for treatment.
Indeed, why were these health centers chosen to receive HIV/AIDS funding in the first place, back in 2002 or whenever? It’s quite possible that the centers were assigned to have HIV/AIDS funding because the centers were already more likely to have better outcomes. For example, centers that received funding may have had more and better (or better paid) doctors, or perhaps they were located in areas with higher population density, or with higher HIV/AIDS prevalence rates. Similarly, the authors note that, unlike the rural areas that were the subject of the study, all urban health centers in Rwanda provide HIV/AIDS services; this fact alone suggests that treatment (HIV/AIDS funding) was initially assigned based on facility characteristics rather than a random assignment in a representative list of centers.
The authors attempt to address this issue by matching the 25 intervention health centers to 25 control health centers. But the authors match on just three characteristics – (1) health center ownership, (2) performance-based financing, and (3) district income in 2002; however, it is unclear that these were the criteria for initial assignment to treatment.
Further, the authors do not provide any information to reassure us that the intervention group and control group were comparable on a range of relevant characteristics prior to treatment that might otherwise explain differential performance.
2. External Validity: How generalizable are study’s claims?
Beyond the internal validity constraints, the generalizability of the study’s findings is very limited.
The study—and particularly the press release—claims to measure the effects of HIV/AIDS funding on non-HIV/AIDS health services. Such a claim, however, ignores the numerous channels by which HIV/AIDS funding can affect a health system besides funding HIV/AIDS treatment in existing facilities; for example, HIV/AIDS funding can lead to technical assistance at the national level, newly built facilities operated by international NGOs or other foreign organizations, as well as health promotion and preventive care at the community level. But the authors’ indicator for HIV/AIDS funding is simply a binary categorization of whether a facility offered HIV/AIDS treatment or not. Moreover, the paper does not discuss the magnitude of funding, the funding source (PEPFAR or Global Fund vs. Ministry of Health disbursements), or whether the facility received an earmarked funding stream specifically for HIV/AIDS rather than general funds which it then elected to spend on HIV service provision. The narrowly focused study does not consider the wide array of other system level effects created by HIV/AIDS funding that have been raised in the previous literature.
In particular, the study does not tell us anything about the effects of parallel NGO service delivery or the impact of new or dedicated facilities exclusively for HIV/AIDS, both of which are hot topics in the HIV/AIDS health systems debate. Indeed, in 2008, less than 5% of Rwanda’s PEPFAR funding was channeled through national institutions; the rest was delivered via a range of contractors, most of which were American NGOs or universities (Table 1). The paper makes no effort to address the consequences this funding arrangement and the presence of the 44 PEPFAR prime partners in Rwanda.
Table 1: Top Planned Recipients of PEPFAR Funding for Rwanda (USD), FY2008
What’s more, this particular country (Rwanda) is likely to be an outlier among HIV/AIDS funding recipients due to its exceptional national healthcare system, high quality HIV/AIDS service delivery, and innovative health initiatives like community-based health insurance. According to the World Bank’s World Wide Governance Indicators for 2009, Rwanda ranked 7th out of 45 Sub-Saharan African countries for government effectiveness, scoring more than one standard deviation above the mean. Moreover, HIV/AIDS funding in Rwanda accounted for about a fifth of total health spending, a percentage higher than 30 other countries in sub-Saharan Africa.
We understand that the authors likely suffered from significant data constraints; likewise, we recognize the enormous empirical challenges in demonstrating system-wide effects at the national level. Still, it remains important to carefully state qualify results and recognize the limitations of one’s research.
Bottom line: The jury is still out on whether HIV/AIDS funding has displaced or improved efforts on other disease control priorities. Let the debate about funding imbalances for global diseases continue…
Ensuring better quality care within constrained budgets is an issue in developing and developed countries alike. In the US, the Centers for Medicare & Medicaid Services new Innovation Center is tasked with helping transform Medicare, Medicaid, and the Children's Health Insurance Program through improvements in the health care system, thereby ensuring better health care, better health, and reduced costs for beneficiaries. Hoangmai Pham will present an overview of the Innovation Center and discuss its experiments in payment models such as accountable care organizations and primary care medical homes, with a particular focus on the value for money and efficiency implications. Can these processes and systems find applications in global health programs and financing systems? How can CMS utilize systems used internationally to better leverage efficiency and reduce costs? What are the processes for cultivating innovation that could benefit global health activities across the globe?
Before joining the Center, Pham was the co-director for research at the Center for Studying Health System Change, and she has published widely on quality of care, payment reform, and physician behavior. She won the Avedis Donabedian Award in Quality from the American Public Health Association in 2010.
In recent weeks, the public health world and political pundits alike have been abuzz about results from the “Oregon Experiment,” a study published in the New England Journal of Medicine that finds no statistical link between expanded Medicaid coverage and health outcomes such as high cholesterol or hypertension. Limitations of the study aside, the Oregon Experiment is a good example of the importance of rigorously testing all US health programs, rather than just assuming ‘more care = better health’. The Innovation Center at the United States Centers for Medicaid and Medicare Services, created under the umbrella of the Affordable Care Act, represents a new and encouraging approach to address this problem, an approach that we think has important lessons for global health.
As a quick introduction, the Innovation Center is using structured, institutionalized innovation and experimentation to search for a better way. Through its iterative and risk-tolerant experimentation with a range of payment models for US government-funded healthcare programs, the Innovation Center aims to improve health and health-care at lower costs for Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP). And while “institutionalizing innovation” may sound like an oxymoron, the Innovation Center suggests that there can be tremendous benefits to doing so.
First, institutionalization can facilitate a systematic approach to trying new ideas and models, potentially with more discipline and rigor than ad hoc experimentation. Recognizing that innovation is less about a stroke of genius and more about careful and systematic hard work and persistence, the Innovation Center focuses on tackling any given challenge (e.g. lower costs while improving quality of care) by piloting a wide range of plausible new models and approaches. It implicitly recognizes that certain challenges, such as controlling health-care costs, are so complex that there is likely to be more than one viable solution.
A second benefit is that institutionalization of innovation can, to some extent, protect against the disincentives of failure. It is a well-known cliché that failure is an inevitable companion to innovation and invention. Yet failure is often discouraged or punished, particularly within governments and the non-profit sector, even though we all know that failure is necessary to improve. For example, many are citing the “Oregon Study” as confirmation of their own pre-existing assumptions about the broad inefficacy of government spending, rather than as evidence to inform tweaks and modifications of the program. Rarely do institutions readily welcome such vulnerabilities – but if innovation is institutionalized, there may be more space and protection to take risks with a high probability of failure but tremendous upside potential. Indeed, the Innovation Center is somewhat analogous to a venture capitalist for Medicare and Medicaid; it is willing to put down seed funding up front on a broad portfolio of high-risk, high-reward challenges, with the expectation that it (i.e. the US government) will accrue the enormous benefits if even one innovation succeeds at scale. Moreover, an institution focused on innovation will have a nuanced understanding of what is meant by ‘success’ and ‘failure’—that it is not simply black and white, but rather a continuum. Large failures are less likely with accumulating daily success which require strong measurement and information systems for constant learning.
A third benefit is that, at least when housed within a large implementing organization (such as the Centers for Medicaid and Medicare), the scale-up of successful models to the national level is more easily attainable. One ongoing challenge of innovation and experiments is that even with a successful idea or model at the pilot stage, scale-up may be impossible without an existing institutional structure. Many good or great ideas never reach scale for lack of institutional adoption or dissemination. By explicit linkage within a larger organization, and by giving the larger organization a mandate to adopt and scale-up evidence-based practice, the potential for systematic change is far more likely.
The very existence of this humble, still-young Innovation Center has much to offer and teach the global health community –including countries and governments who seek to improve their national health systems. For example, as South Africa works towards developing a national health insurance program, it will undoubtedly need to experiment to figure out what insurance arrangements will work best in the country – and it should consider establishing an innovation center for this purpose. Similarly, as India pursues a strategy to improve child survival, the country could experiment with a set of interventions to drive improvements in its worst-performing districts. Many other countries pursuing universal health coverage or specific health goals will need to experiment and learn systematically from trials and errors.
The Innovation Center also has much to teach the global health funding agencies such as the Global Fund and PEPFAR. For example, the recent multi-country experiment of the Affordable Medicines Facility for Malaria (AMFm) seems to be a one-off experience for the Global Fund and global health donors. But much was learned from this experiment, and there could be tremendous positive potential from regular experimentation within the Global Fund’s core institutional model. Under the leadership of the Global Fund’s Executive Director Mark Dybul, wouldn’t it be terrific if the Global Fund could experiment with a range of different payment schemes or other global-level financing strategies, and then incorporate the most effective models into its worldwide grant-making? For example the Global Fund could experiment with its results- or performance-based financing (see here and here for related options) to drive greater effectiveness and efficiency of its investments.
With a budget of $10 billion through FY2019, the Innovation Center is small potatoes relative to the ~$500 billion annual budget for the Centers for Medicaid and Medicare Services. But the $10 billion is quite a significant sum to enable large-scale research, with big sample sizes and multiple study arms. In contrast, the Global Fund’s total disbursements in 2011 were a relatively paltry $2.7 billion (per IHME estimates; total development assistance for health was $28 billion). The difference in scale is potentially important, and will help to define the scope of experimentation within an analogous innovation center in the Global Fund.
The bottom line is that while the Innovation Center is an incredibly encouraging model for those of us who believe in evidence-based, forward-looking health practice and constant learning – and for those who believe American health expenditure can and should lead to better health. We hope global health funders are paying attention.
Victoria Fan is a research fellow and Rachel Silverman is a research assistant at the Center for Global Development.