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Welcome back, listeners to the show. Advancing Health Systems in low and middle income Countries. This podcast miniseries is part of the H F G Project, the Health Finance and Governance Project, and you could learn more about that project in Episode zero. But just know that the goal of the project is to strengthen health systems, especially in low and middle income countries around the world. My name is Kirby Kreider, and I'll be your host yet again. I work on the Hft project and I said this in the past, but I just want to reiterate that I have delighted honored, and I feel like it's a privilege to be here talking to you. We've been watching play counts on the previous episodes keep growing, and there's people listening from all over the world, which is really, really cool. To see one of our goals with this podcast is to take some of the lessons learned from this multi year U. S. A. I D funded project and share them with development practitioners from across sectors, not just health and public health sectors. In this episode, we're going to look at the topic of health insurance and we're gonna do that in a similar way that we've looked at other topics like domestic resource mobilisation and digital health and digital finance and previous episodes. I'm going to be your host, and I'm going to try to provide context and introductions and give you the connections between what different experts from the Hft Project are saying, and they're going to try to help us Answer three questions. One. What is health insurance, too? Why does health insurance matter, especially in low and middle income countries? And three. What lessons has the Hft project learned about health insurance and doing health insurance? Right. And these countries? Let's go ahead and get started with our first question. And to answer that first question, what is health insurance? I'd like to introduce you to Abdel Yazbek. He's an economics adviser on the Hft project, so the best way to think about health insurance is to recognize there's a lot of uncertainty and health spending, and that uncertainty comes from the fact that a few off us will need healthcare in a certain year. There's something we call the 10 60 principle, where empirically we found whether it's in China, in the US the 10% of the population in a typical year will end up consuming 60% of health spending, and we don't know who are the 10%. We don't know how much money they will need, So insurance becomes an important way off pooling resources from everybody. So when people need care, then it could be paid for the. It's a way of making sure that when you need health care, you can get it, even if you don't have the means to pay for it at that moment. And that is, it's really what health insurance is about. It's really what universal health coverage is about to that people should be able to access healthcare services when they need it, regardless of their ability to pay. Now. For that toe work on a population level scale, you need to have some way of pooling money to cover health services that are very unpredictable. Health insurance is just one way that the country's used to pool money for health pool risks for healthcare together in order that people can can access it when they when they need it. The second voice you heard there was Nathan Blanchett, who works for our for D results for development, one of the partners on the H F G project. And both Abdo and Nathan talked about a concept that's integral to health insurance, which was pooling, Let's dig into pulling just a little bit more. Here's Nathan again. Imagine if on any day of your life you might suddenly have the need to buy a Lamborghini. You know, most of us would have a lot of trouble doing that, and we don't have to worry about it because we don't really need a Lamborghini. But if you suddenly had to buy a Lamborghini to stay alive, you'd be in trouble. On that is where something like health insurance, if everyone can, can pool resource together, then the few people that have that acute need can can get it. The rich can help subsidize the poor. It also means that the healthy are helping to subsidize the sick, the healthy, commit contributions into some kind of mechanism and then knows those re sources can be used for the sick and the healthy. Don't need them then another one that doesn't get as much attention is the sort of resource sharing we even do with ourselves across our lifetime. If you think of ah healthy, working age person that doesn't maybe have intense health needs right now, he or she might be paying into some kind of health insurance game, not really using it at the time. But then they may retire. They get older, and when they're older, they have health care needs, and they have helped sustain a system which they then can benefit from in the future. Insurance helps countries do all that. It's not the only way that countries could do it, But it is a popular way. And it's one that more and more low and middle income countries have been experimenting with over the past decade or two. Pooling is a critical concept to health insurance. Nathan's description of how pooling can be across the rich to the poor, the healthy to the sick, and there's even pulling that can occur within one person's life. A younger self can pool resource is with an older self in order to pay for health care when it's needed. What Nathan started to get to at the end there was that pooling is something that applies, not just to health insurance, I'd like to now take us down a little avenue outside of just health insurance. But still looking at this concept of pooling and the question I want to explore as we are thinking about what health insurance is and what pooling is is how do other countries, not just low and middle income countries around the world, deal with the problem that Abdo laid out when he first started talking That 10 60 problem where 10% of population uses 60% of the services at any given time, and we don't know who that 10% of the population is to do that, let's talk to a health insurance specialist and also a member of the H F G Project. Gina Holtz, to most common ways to finance health care is 12 provide services directly, and maybe the best known example is the NHS in the UK In the new national insurance acts come into operation. For the first time, everyone or almost everyone in the United Kingdom can insure against want. There will be sickness and unemployment benefits, retirement pension, maternity grants, death grants. Under the new acts, everyone will be required by law to make a weekly contribution to the scheme. Yes. And so will 22 million other people. And only a scheme like this gonna force such high benefits. Come on, now it's worth it. Isn't it? Every penny of it. Think of it. I'm paying out quite a lot now in bits and pieces, just in time to find out all about it. Before the scheme stops, get the address of your national insurance place from the post office. Insurance would be an alternative. Were different type of health financing mechanism. And by the way, it's common for countries to use both in the United States of America. The city of Chicago, 1931. Statistics said life span 59 years, 2 to 1. He was born at home costs to parents, $50 cost of medical equipment, $87.50 including the black bag in his lifetime. A total of $1700 for health care, mostly out of his own pocket. It was a new idea, then insurance to help pay hospital bills, but practically and nobody had it only a generation ago. How much change within living memory with Gina's helping with the help of those two archival clips, both from the 19 fifties, the 1st 1 about the National Health Service in the UK and the second about private insurance in the U. S. I think we have a clear picture and a clear context of two common ways to do health insurance. We also played those clips to highlight the importance of history. When it comes to the decisions that a country makes about health insurance, let's dig into that history just a little bit deeper again. With the help of Abdo, the 1st 1 that's almost everybody's familiar with is the Bismarck model, or what's now being called social health insurance. And that's a situation where money is earmarked from labour tax or anybody who works a percentage of their salary and a percentage of what the employer pays goes into a fund that's used for healthcare services that's called social functions, or the Bismarck model on that's, for example, the most obvious countries, or Germany or France, that well developed countries. It's also all over Latin America and increasingly in Eastern Europe and now starting to show itself in Asia as well, and even some African countries are interested in. The second model is more of the British or Canadian model in school. The beverage model named after Lord Beveridge on this came after World War Two, where the British wanted to make sure society, which was poor, impoverished because of the war, had basic services. Health was one of the more important services, so there's not a standard insurance, but everybody is covered, so they are insured in a way, but they don't pay into it. And there's no Labour fax its overall government revenue that pace for it. And in this model, usually the government is in charge of funding it and in many cases, even delivering services. Loser, the two largest dominant models the public financing model and the labor tax financing model, the other two are are very different. One is the US based insurance system, which is has elements off the beverage in which there is a labour relationship. So in the United States, insurance is an employer responsibility on so most of us get our insurance because we work in a certain place, and so part of our salaries air taken out part of the employer payment gets spent two into an insurance, but it's labour linked. So what happens with that is that those who are outside Labour than they need a different way to be covered. Um, it's not necessarily the most efficient or equitable health system, because it leaves a lot of people outside and so government has to jump in. So you have Medicare, Medicaid and alternative ways to then protect those who are. And even with that, before a C A, we had 40 million people who are uncovered. The fourth model, which is the dominant dominant in low income confuse. It is zero insurance, which is you pay when you ask for service or when you need the services. A fee for service. It's an out of pocket spending. It means the 10% who need 60% off health spending 10% of population who needed at any point in time will face amazingly high medical bills, which they may not be able to you. So you end up with two outcomes. Both are terrible. You either borrow money to pay, you impoverish yourself or you can't even borrow enough so you don't get care at all. And both are terrible outcomes. And so the fourth model, which is really the default model, which is no insurance, no pulling, no public funding. It's basically we pay when we need it, and it's a terrible way of organizing healthcare financing. So there are a lot of historical systems, but it's important to note that most countries don't have just one system. There are often a mix of these different systems, but they might be predominantly one system. And another important thing to note is that cash and carry fee for service out of pocket. That last system that Abdullah's describing is really a terrible, terrible way and not very equitable way, not a pro poor way to finance health within a country, especially a low and middle income country. I think we've answered the first question of what is health insurance and in fact, we started to bleed into the second question, which is Why does it matter and why does it matter in low and middle income countries? By talking about the concept of pooling? I'd like to really focus in on part of that second question, which is why does it matter in low and middle income countries? To answer that, here's high lose a lulu who is a senior associate and a health economist on the Hft project, where the basic principle is the same wherever you are living in whatever socioeconomic condition you are. Ah, but the major differences in low and middle income countries. It could be a life in this situation. If you don't have that is cooling mechanism or any other mechanism where they set party pays for you. In most cases, people getting sick means zika it up. If that that sickness gates wars, they could have end up dying or experiencing the waters. So there's the obvious difference in low and middle income countries. There's less money, there's less. Resource is. So if you get sick and you don't have health insurance, then you're more likely to experience the worst outcomes there. Some other differences as well. Here's Gina Holtz again. In developing countries, you would typically see many more people who are part of the informal economy, which means that they're not in, ah, salaried job where they're paying taxes and they're they're contributing, and they're known by the government. These were people who are working sporadically, doing contract work, just self employed and so on. So that makes it really difficult for those countries with high levels of informal employment to mobilize. Resource is through some of the mechanisms that the higher income countries, like the U. K or Canada or others use, which would be payroll taxes and would be just higher and sort of more predictable levels of income, taxes. Whatever mechanisms that country uses and for N is, well, ah, higher income country just has more to give informality. You might ask like, Why does that matter at all? Why do you care of somebody's informal? They're not paying taxes. It's very difficult That then direct that money into some sort of national health insurance. They're not in the system administratively, but also, um, if people are, if people are not in the workforce is very difficult to know where they are, who they are, what their family sizes. They can often times be invisible. So some of the people that work but are informal are farmers market vendors, day labors for, like construction, transport workers, taxis either rickshaws, um, as well as people that do you know, other types of hidden kind of of work. Um, so what we found which was striking is that in the e p c m d countries a quick aside here, e p c m d is ending preventable child and maternal deaths and these air countries that have higher than their peers rates of child maternal death. Roughly 70% of the labor force is informal, so this is much higher than in the general pool of low and middle income countries. And in some countries where we looked, you know, like Madagascar. Over 95% of the population is informal. I'm and even some upper middle income AP CMD Countries like Indonesia still have a considerably large informal sector. So this begs the question of like, how useful is that characterization? The second voice you heard there was Adam Kun. He's a health governance specialists and a public health researcher. Another huge difference in low and middle income countries as compared to higher income countries, is the presence of the informal workforce in the US In the UK, there are predictable payroll taxes that you can tax to fund a national health insurance or to fund private insurance programs in low and middle income countries. That's clearly not the case in some countries, it's up to 90%. As Adam was saying, You might be asking yourself now, how do we solve this problem? How do we address the needs of informal workers in these countries? And for that we're gonna move to our third question, which is what lessons has Hft learned about health insurance in low and middle income countries around the world. And we have two great examples, one from Ghana and one from Ethiopia. And they both have dealt with this informal workers issue and they both have had some success. Let's start with Ghana, Ghana Ghana is great example of a country that sees the political moment to introduce a national health insurance scheme. Ghana previously had sort of a history of people paying out of pocket for their services, and they called that cash and carry. It was very unpopular because it created hardship for people and it particularly was hard for people who report there were some awful stories in the media about patients being detained in hospitals or denied critical access to care and even dying because of an inability to pay these fees, which they called cash and carry, and the NHS is big promise was that it was gonna end cash and carry, and it largely succeeded in doing that to eliminate such barriers to accessing critical health care. The National health insurance scheme was introduced in 2000 and four, replacing the cash and carry system with a payment of a yearly premium. All citizens are now entitled to free medical services. The benefits to poor communities are obvious across Ghana, Enrollment for the national health insurance scheme now stands at 15 million. So in response to that cash and carry system, Ghana implemented the National Health Insurance Service and if you were listening carefully, you may have picked up on one of the major lessons that Hft has learned about health insurance. It's that it's a political process. It's not just a technical process of getting people all the information that they need, there's politics behind it, and development practitioners need to be aware of those politics. Here's Nathan again, with a little bit about the politics behind the creation of the National Health Insurance Service, the enactment of the NHS, it was very much a result, heavily influenced by this competition between two major parties, then pp and the NDC, so then PP ran on a campaign in the 2000 election of abolishing this this user fee based this cash and carry program that was so controversial, they said it would, they would abolish it and they won that election. That was the first time in Ghana's most recent history since there since early nineties that there was a change over in power. So that party came in and I think there was a lot of pressure for them to deliver on that campaign promise before the next election in 2000 for Ghana has since undergone two more peaceful Democratic turnovers of power. So how did Ghana do this? There was clearly the political will when this New party came into power and ran on, had national health and shirts and abolishing this very unpopular system. But there was also some other things that they did that were very important and some lessons that the Hft project has learned. Here's Nathan again. They got new sources of funding. They added 2.5% points to their value added tax like a sales tax that would go into a dedicated fund for the health insurance game. They also got some contributions from their formal sector workers through their Social Security program. Those two sources have made up about 90% or more of the revenues for the scheme. And if you think about it, those are prepaid sources coming from very large swaths of the country. So there and both of those things are important. The concept of pre paying so so patients are not faced with that need to pay at the point that they need care. They may not have the money at that, and you are then able to have a fund that can fund services. So they got new sources of funding. The second thing was that they created one what we health economists call risk pool, meaning that everyone in the country every Ghanaian who enrolled in this scheme is essentially in the same pool covered by the same funds, and their risks are able to be shared. They also made their insurance scheme quite comprehensive in its benefits. It is intended to cover 95% of the disease burden, and you can use it anywhere. So it's been portable. So those were some of the things that Ghana did, and most would agree, really got right as some important foundations. It did help in cash and carry and help increase utilization of health care, including among the poor. In some ways, it goes back to financing. They found a way to add source of revenue, the value added tax and another source of revenue from the formal workers and Ghana, even though that's a relatively small percentage of the population. So the key lesson is that the government took it upon themselves to figure out to new sources of revenue and have used those to pay for health services and to get health care two grenades. But of course, this process was not without its challenges. Here's Nathan again. They also have had many challenges, and that's part of what partners like the Chucky Project have been working with with Canadians on. So they're scheme. Waas enacted very quickly, designed very quickly, and it was extremely ambitious. Over the past 15 years, they have faced some pretty serious financial sustainability problems and also some problems with the efficiency of their operations. Um, so let me just say a couple things about both of those. The major challenge with financial sustainability was that there was never a real careful balancing between the revenues coming in from the taxes that I mentioned and expenses going out. There was really no controls put in place. There was sort of limited ability to monitor what providers were submitting claims for there were no copayments or anything like that to sort of serve a bit as a check on use of services and utilization has climbed and has outstripped the revenues coming in, purchasing health care like this. You know, they had a new agency, the National Health Insurance Authority, that was really purchasing health care in a way that had not been done before in Ghana. And they had a lot to learn about becoming what we now refer to as a strategic purchaser off health services. So what H G has worked with them on is is a number off measures that they can take to tackle these these challenges. So, for example, there now in the process of doing various reviews and assessments to revise their benefits package, they have realized that they really want to, uh, orient that benefit benefits package mawr toward primary health care services so that they can reach more people with more cost effective services on. And they also have realized that there's just a great deal of new capacities, new functions that need to be that need to be run in insurance setting and the authority. The National Health Insurance Authority has been growing its abilities to do that, and one of the biggest things that have worked on is using evidence better. The first step is to be able to detect more rapidly when you have problems in enrollment or problem in claims. So H f G has worked with the N H I A. To create managerial dashboard that help managers there hone in on key indicators that are very important. If it's enrollment, it may be how many men versus women are enrolling or how maney, young or elderly or exempt populations or nonexempt populations are enrolling so that they can rapidly see where they have a problem and be able to act on it. Dr. Lydia Selby, who is now the deputy chief executive for operations of the N. H. I. A, told us that they were tired of running just on anecdotes. They really wanted to turn anecdotes into evidence but did not yet have some of the systems in place to be able to do that well. We worked with them to sort of continue and enhance things that they had already started. For example, they had already started doing some operations research. We helped develop a new system for operations research, for identifying the key questions that the authority needed to investigate training their staff, to be able to design rapid studies that could be very practical and get them the answers that they needed on key issues and then come up with some actionable recommendations and to really institutionalize that as part of the culture of the authority it takes putting in place. The right process is you have to get buy in from the various parts of the authority, and the various directorates really need to work together for that to work well. And they've made enormous strides and doing that. There were a lot of rich lessons in what Nathan was just talking about. One that I'll again highlight, which we've already said is that the government has to lead the process and the government has to lead the charge, and the government has to find sources of revenue and allocate sources of revenue specifically for health insurance. Another big lesson that the Hft project has learned on this is that institutional capacity is truly, really important. And that's actually one of the areas that H f. G has really contributed to in Ghana, building the capacity of administrators of health insurance experts of people in the ministry. All is really important for getting health insurance toe work. It's a complicated and technical realm. Ghana's national health insurance system, in the success that they've had, is well known across the continent and around the public health world, and they did it in a government led way that works for them. Let's now move across the continent and look at a different country. Example. Ethiopia, who did things a little bit differently, is doing the data from 2013 14 and that it our shows certain, 30% off the totals expenditure in the country's coming after pocket, which means coming from household and the other. The other significant amount is coming from donors including U. S government and others on around 30% is coming from the Ethiopian government. So as you can imagine the contribution off households for their healthy significant is set 3% of the total. Ah, spending on health, which is big and it's ah above the w chose three commented level level actually commended or any, um, reasonable household spending special in the lower and middle income countries, it should, ranging between 15 and 20% off the total spending, so each appears far from that. So, according to the National Health Account, a survey done in Ethiopia, 33% of total health spending was coming from out of pocket expenditures, which, as we have established, is a big problem. So how did Ethiopia solve this problem? Let's hear from 2011 and 2013 ah U S aid helping the country to pilot community based teams in France, it was piloted in certain district's, which is out off postal about 900 basics on and under Hft. We supported government if European Health Insurance Agency to evaluate of the pilot program on the pilot showed important developments in terms off providing financial protection and health service organization amongst th I members versus the general population. So because of that, the government was convinced it that it needs toe scale up committee based positions. We help it in developing their scale of strategy in 2015 on Since then it has been so US aid on another project piloted community based health insurance and H F G helped scale it up in Ethiopia. What is community based health community? Visit Health devices. It's a small in size, but also it's focusing towards certain groups like it could be small business beds. It could be a residence. Best. It could be any other social economic groups coming together and then pulling their resources to tohave ah, financial protection for their health care needs. After hearing that you might be asking yourself, How does C B H I actually pulled together? Resource is if community based health insurance is a bunch of fragmented risk pools out in the countryside. If one poor community has community based health insurance, how is that actually achieving that pooling that we talked about? And this gets back to some of those lessons that we talked about from Ghana? Even though C B. H I is a voluntary scheme and it seems like it could be relatively small, the government has to get involved. So government is providing financial support to cover for around 10% off for householders. Toby enrolled into the community based residential as it came. And so they are members, like another segment of the population who are enrolled in the committee spends tens insurance, and they benefit from the program in terms of financial protection. They don't have any different I D card from other members. They can't be labeled as poor householders because no one knows whether government paid for them or a pit after breaking, they recognized us. Ah, community based health insurance members. Ah, the other important aspect is government also higher and provided city, um committed best health insurance expert district. Those are eight from governments or Supachai Skins. I'm not spending their money toe pay salary, a salary paid by the government and also all operational costs. This work as a child, skins are covered by a local command limit, which is again another good support from government. So the contribution that I get a subsidy, including the general subsidy, is used only to cover expenditure for health or for letting for facility for health facilities. Services went to our city chime in, but you can implement this type of program at scale unless you have. It's from government by leadership and commitment on that commitment includes the financial commitment. The other lesson out bring is to have the necessary institutional arrangement and capacity government established and run. The new health insurance agents is College European Health Insurance Agency that agents has over 1002 stuff, and it has around 29 30 branch offices around the country. Andi. It's leading the community based health insurance as well. The two lessons to really highlight there are once again the role of government and pushing this forward and in finding sources of revenue and the capacity that's needed to run a health insurance system. Any health insurance system, whether it's a national health insurance system of social health insurance system like in Ghana or a community based health insurance system in Ethiopia. So what kind of coverage has the C B. H I scheme in Ethiopia achieved? Here's hi, Lou. One more time. As of now, around 500 district are either covered or their in process off are implementing community based health insurance, which is a huge jump that is from certain District er's during the pilot. When we did pilot violation in 2014 to ah, around 500 distinctness in terms of population, cover it the pilot coverage oars covering around 160,000 householders with a total population off around 700,000 are now that coverage has increased to over 30 million households and over 19 million individuals are covered under the community based health insurance. So it's important in terms off, expanding, committed. One thing I heard from almost everyone that we interviewed was that there isn't a single correct healthcare is that there isn't one single magic bullet health insurance system. It's more about finding the perfect set of systems for a country that's gonna work for that country and also setting up those systems in such a way that they can adapt to changing conditions. Here's Abdo one more time. All these systems, it's not about getting them right. It's about getting a system to keep tinkering because stuff will happen. Changes will happen. The population of politics will happen, and so you need a builder bus system to keep adjusting. A best practice way of doing thing is not to work with a political party to work with. You know, the legislative bodies, civil society bring in more voices, so you're protected from it becoming a political issue because the reality is democracy changes the players. And if you keep changing systems with the players at the root, it's a challenge for a sector like health. And if you ignore the others and you tie it too much to one political party, that's what country chooses to do. You create a high risk off the next government, throwing it all out and starting all over before we in the episode, I'd like to play one last clip from Katherine Connor, who's the deputy director of the Hft Project. Most of the countries where we have worked in, I think, in a very deliberate, intentional approach to learn and adapt as they as they implement expansion of health insurance. If you look at Europe, how long did it take England, Germany, France to develop and operate this health coverage that they have today? It's of more than 100 years in relative terms. What we're seeing happen in Africa and Asia is much faster, frankly, much, much faster. Ghana introduced their health insurance and it got about 75% coverage with within 10 years through the importance of the of A project like ours is that our client U S A. I d. As an international donor, they want, they want to, they want to see a day when their financial support isn't necessary. And they want to see a day when the countries are running everything on their own. And their macro economic development has reached a tipping point where they could pretty much fund everything on their own and putting these thes systems in place that are, you know, well developed and well managed and properly financed and reflect the latest knowledge in terms of you know, how to be efficient and the equitable etcetera. So these health insurance schemes are are are huge leak towards that type of self sufficiency. With those last words from Katherine, I'd like to close out the episode with a thank you for listening. Thank you for subscribing sharing on soundcloud iTunes stitcher. Wherever you get your podcasts, please continue to do that. And please give us feedback. If you have questions or comments. We love to hear from you. Another. Thank you to Abdel Yazbek, Adam Kun High lose a Lulu, Katherine Connor, Gina Holtz and Nathan Blanchett. For all of their help on this episode and a special thanks to Jen Leopold from the Hft Project, thanks to blue dot sessions for our theme music from the series and finally a thank you to the U. S. Agency for International Development for funding the Hft project. See you next time for our final episode.