This CDI Practice Paper provides a critical assessment of the literature on tax experiments to date. It examines the main conceptual, methodological and data-related challenges, and provides practical reflections on how to move forward in low- and middle-income countries where this type of research is still underdeveloped. It offers a guide for practitioners on the main challenges in quantitative research on tax compliance and on the methods used tackle them, which may be of interest for evaluation research more generally.
Resource allocation and health financing
Tax Experiments in Developing Countries: A Critical Review and Reflections on Feasibility
Mascagni G: CDI Practice Paper 11, March 2015
Delivering Social Protection Systems for All: Why Taxes Matter
Bastagli F: United Nations Research Institute for Social Development (UNRISD), 5 October 2015
Social protection and taxation feature prominently as key policy instruments available to governments in the pursuit of development goals in both the Financing for Development (FFD) Addis Ababa Action Agenda and the Sustainable Development Goals (SDGs). This reflects a growing recognition among policy makers in the international development context of the powerful role fiscal policy plays in shaping development outcomes. It also represents an important opportunity for closer consideration of the ways in which taxation and social protection operate jointly in practice. Taxes and transfers commonly continue to be discussed separately, yet in practice they interact to shape the distribution and redistribution of income and wealth both directly – through the distribution of transfers and the tax burden – and by influencing processes of government accountability and legitimacy, the quality of service provision and people’s willingness to pay taxes. If appropriately designed and implemented, taxes and transfers can make a significant dent in poverty and inequality. In high-income OECD countries, direct taxes and transfers alone contribute to an average 30% reduction in income inequality, reducing the average Gini coefficient from 0.41 to 0.29. In comparison, in developing countries, their impact is more muted. There is thus scope to strengthen these systems, particularly as in July 2015, world leaders in Addis Ababa agreed on a commitment to delivering social protection and essential public services for all through a new social compact to ‘end poverty in all its forms everywhere’.
Health care is a social investment: An interview with South Africa's Minister of Health
Smith J: Mercury, 22 January 2016
This paper presents an interview with South Africa's Health Minister, Aaron Motsoaledi. in which he answers six big questions about the National Health Insurance White Paper: Are you intending to stop medical schemes providing the same services as NHI? Are you intending to curb, if not entirely limit, private health care? Was a battle with the Treasury over the enormous amounts of public money it’s going to take to fund NHI a main reason behind the delay in releasing the White Paper? What’s the point in the Healthcare Market Inquiry (HMI)? You’re looking at full implementation of the NHI by 2025. Is that fair? It presents the Minister's answers. He notes that the NHI envisages a society based on values, justice, fairness and social solidarity. Health care is a social investment, therefore it should not be subject to the normal market forces and treated as a normal commodity.
Refusal to enrol in Ghana’s National Health Insurance Scheme: is affordability the problem?
Kusi A, Enemark U, Hansen KS, Asante FA; International Journal for Equity in Health 14(2), 2015
Access to health insurance is expected to have positive effect in improving access to healthcare and offer financial risk protection to households. Ghana began the implementation of a National Health Insurance Scheme (NHIS) in 2004 as a way to ensure equitable access to basic healthcare for all residents. After a decade of its implementation, national coverage is just about 34% of the national population. Affordability of the NHIS contribution is often cited by households as a major barrier to enrolment in the NHIS without any rigorous analysis of this claim. In light of the global interest in achieving universal health insurance coverage, this study seeks to examine the extent to which affordability of the NHIS contribution is a barrier to full insurance for households and a burden on their resources. The study uses data from a cross-sectional household survey involving 2,430 households from three districts in Ghana conducted between January-April, 2011. Affordability of the NHIS contribution is analysed using the household budget-based approach based on the normative definition of affordability. The burden of the NHIS contributions to households is assessed by relating the expected annual NHIS contribution to household non-food expenditure and total consumption expenditure. Households which cannot afford full insurance were identified. Results show that 66% of uninsured households and 70% of partially insured households could afford full insurance for their members. EnrolLing all household members in the NHIS would account for 5.9% of household non-food expenditure or 2.0% of total expenditure but higher for households in the first (11.4%) and second (7.0%) socio-economic quintiles. All the households (29%) identified as unable to afford full insurance were in the two lower socio-economic quintiles and had large household sizes. Non-financial factors relating to attributes of the insurer and health system problems also affect enrolment in the NHIS. Affordability of full insurance would be a burden on households with low socio-economic status and large household size. Innovative measures are needed to encourage abled households to enrol. Policy should aim at abolishing the registration fee for children, pricing insurance according to socio-economic status of households and addressing the inimical non-financial factors to increase NHIS coverage.
The complexity of resource allocation for health
Dieleman J, Haakenstad A: The Lancet 3(1), 2015
This research emphasises that many governments are not meeting spending goals, and in many countries the financing gaps are so great that, even if they met the spending goals, expenditure would still fall short of what is needed. Expenditure would cover only 64% of estimated future funding requirements, leaving a gap of around a third of the total US$7.9 billion needed.
Financing and access to health care in West Africa: empirical data, cartoons and received ideas
Queuille L, Ridde V, University of Montreal, School of Public Health: January 2015
The project Access to healthcare for vulnerable groups in West Africa with the Help NGO produces publications in order to make research results and knowledge more accessible. The authors have worked for 10 years on producing and applying scientific knowledge about healthcare access and financing in Africa and aim to share their observations by experimenting with using satirical cartoons as a knowledge sharing tool. Made by the designer Glez, this series of cartoon focuses on preconceived ideas that people can have about the implementation of free health care and health insurance coverage in Sub-Saharan Africa.
Overcoming challenges to sustainable immunisation financing: early experiences from GAVI graduating countries
Saxenian H, Hecht R, Kaddar M, Schmitt S, Ryckman T, Cornejo S: Health Policy and Planning 30(2) 197-205
Over the 5-year period ending in 2018, 16 countries with a combined birth cohort of over 6 million infants requiring life-saving immunizations are scheduled to transition from outside financial and technical support for a number of their essential vaccines. This support has been provided over the past decade by the GAVI Alliance. Will these 16 countries be able to continue to sustain these vaccination efforts? To address this issue, GAVI and its partners are supporting transition planning, entailing country assessments of readiness to graduate and intensive dialogue with national officials to ensure a smooth transition process. The report presents learning form a pilot and observes that the experience of countries that have already transitioned should contribute to thinking about how such transition away from external funding can be achieved in low and middle income countries.
The health system cost of post-abortion care in Rwanda
Vlassoff M, Musange SF, Kalisa IR, Ngabo F, Sayinzoga F, Singh S, Bankole A: Health Policy and Planning 30(2) 223-233
Based on research conducted in 2012, the authors estimated the cost to the Rwandan health-care system of providing post-abortion care (PAC) due to unsafe abortions, a subject of policy importance not studied before at the national level. Thirty-nine public and private health facilities representing three levels of health care were randomly selected for data collection from key care providers and administrators for all five regions. Using an ingredients approach to costing, data were gathered on drugs, supplies, material, personnel time and hospitalisation. Additionally, direct non-medical costs such as overhead and capital costs were also measured. We found that the average annual PAC cost per client, across five types of abortion complications, was $93. The total cost of PAC nationally was estimated to be $1.7 million per year, 49% of which was expended on direct non-medical costs. Satisfying all demands for PAC would raise the national cost to $2.5 million per year. PAC comprises a significant share of total expenditure in reproductive health in Rwanda. Investing more resources in provision of contraceptive services to prevent unwanted or mistimed pregnancies would likely reduce health systems costs.
Who pays for and who benefits from health care services in Uganda?
Kwesiga B, Ataguba JE, Abewe C, Kizza P, Zikusooka CM: BMC Health Services Research 15:44 February 2015
Equity in health care entails payment for health services according to the capacity to pay and the receipt of benefits according to need. In Uganda, as in many African countries, although equity is extolled in government policy documents, not much is known about who pays for, and who benefits from, health services. This paper assesses both equity in the financing and distribution of health care benefits in Uganda. Data are drawn from the most recent nationally representative Uganda National Household Survey 2009/10. Equity in health financing is assessed considering the main domestic health financing sources (i.e., taxes and direct out-of-pocket payments). This is achieved using bar charts and standard concentration and Kakwani indices. Benefit incidence analysis is used to assess the distribution of health services for both public and non-public providers across socio-economic groups and the need for care. Need is assessed using limitations in functional ability while socioeconomic groups are created using per adult equivalent consumption expenditure. Overall, health financing in Uganda is marginally progressive; the rich pay more as a proportion of their income than the poor. The various taxes are more progressive than out-of-pocket payments. However, taxes are a much smaller proportion of total health sector financing compared with out-of-pocket payments. The distribution of total health sector services benefits is pro-rich. The richest quintile receives 19.2% of total benefits compared to the 17.9% received by the poorest quintile. The rich also receive a much higher share of benefits relative to their need. Benefits from public health units are pro-poor while hospital based care, in both public and non-public sectors are pro-rich.
Costs of Eliminating Malaria and the Impact of the Global Fund in 34 Countries
Zelman B, Kiszewski A, Cotter C, Liu J: PLoS ONE 9(12), December 2014
This study aims to 1) assess past total and Global Fund funding to the 34 current malaria-eliminating countries, and 2) estimate their future funding needs to achieve malaria elimination and prevent reintroduction through 2030. Historical funding is assessed against trends in country-level malaria annual parasite incidences (APIs) and income per capita. Following Kizewski et al. (2007), program costs to eliminate malaria and prevent reintroduction through 2030 are estimated using a deterministic model. The cost parameters are tailored to a package of interventions aimed at malaria elimination and prevention of reintroduction.The majority of Global Fund-supported countries experiencing increases in total funding from 2005 to 2010 coincided with reductions in malaria APIs and also overall GNI per capita average annual growth. The total amount of projected funding needed for the current malaria-eliminating countries to achieve elimination and prevent reintroduction through 2030 is approximately US$8.5 billion, or about $1.84 per person at risk per year (PPY). Although external funding, particularly from the Global Fund, has been key for many malaria-eliminating countries, sustained and sufficient financing is argued to be critical for furthering global malaria elimination.