This paper is the first in a special issue which presents a body of research whose overall aim was to critically evaluate existing inequities in health care financing and provision in Ghana, South Africa and Tanzania, and the extent to which health insurance mechanisms (broadly defined) could address financial protection and equity of access challenges. The authors found that insufficient emphasis has been given to analysis of equity of health care financing at the systems level. They argue that studies are needed which explore how financial protection can best be expanded by building on the mix of financing mechanisms currently found in many low- and middle-income countries. Key issues are how to reduce the share of out-of-pocket payments, provide financial protection to the informal sector, reduce the fragmentation of financing arrangements and allocate public resources more equitably.
Resource allocation and health financing
According to the findings of this study, the current Ghanaian health care financing system is progressive, but the benefits from health services are pro-rich. Out-of-pocket payments are the most regressive component of the health financing system, yet still account for the single largest share of health care financing. National health insurance scheme contributions from those outside the formal employment sector are very regressive. The authors conclude that, if Ghana is to achieve universal coverage, it is essential to reduce out-of-pocket payments, to identify ways of providing financial protection for those outside the formal sector within the national health insurance framework, and to address actively the many access barriers to health services.
The aim of this study was to understand the trajectory of health expenditure in developing countries. The authors used panel data from 143 countries over 14 years, from 1995 to 2008 to explore the factors associated with the growth of total health expenditure as well as its main components namely, government health expenditure and out-of-pocket payments. The data show great variation across countries in health expenditure as a share of GDP, which ranges from less than 5% to 15%. Apart from income, many factors contribute to this variation, ranging from demographic factors to health system characteristics. The results suggest that health expenditure in general does not grow faster than GDP after taking other factors into consideration. The authors also found no difference in health expenditure between tax-based and insurance-based health financing mechanisms, and noted that external aid for health reduces government health spending from domestic sources.
The Tanzanian health care financing system is marginally progressive while benefits are fairly evenly distributed across socio-economic groups, the authors of this study found. However, out-of-pocket payments and voluntary contributions to community health insurance are regressive. The poorest segment of the population receives a lower share of health care benefits relative to their share of need, whereas other population segments receive a greater share of benefits relative to their share of need. The authors conclude that health financing reforms can improve equity, so long as integration of health insurance schemes is promoted along with cross-subsidisation and greater reliance on general taxation to finance health care for the poorest.
Ten years since its founding, the Global Fund is facing a serious financial shortfall, and the Fund’s board voted recently not to accept new grant requests until at least 2014. The author states that the question is not whether the Global Fund works, but how to ensure it keeps working for years to come, according to this article. There are four reasons this is imperative. First, the world needs to expand, not contract, access to health care because of the sheer burden of disease. Second, the Fund doesn’t simply give handouts: it takes the longer road of investing in and working with health ministries to build (or rebuild) local health systems. Third, the Global Fund proves how much multilateral organisations can accomplish, when one looks at the many lives it has helped save. While the usual players like the G-8 bear the greatest financial burden, the author urges some of the recipient countries to consider themselves partners of and contributors to the fund – India, Russia and China can play meaningful roles as both external funders and as recipients of grants. Fourth, a global recession is not an acceptable excuse for external funders to avoid the responsibility of meeting their financial commitments to the Fund.
External funders are concerned about how their aid is used, especially how it affects fiscal behaviour by recipient governments. This study reviews the recent evidence on the effects of aid on government spending and tax effort in recipient countries, concluding with a discussion of when (general) budget support is a fiscally efficient aid modality. Severe data limitations restrict inferences on the relationship between aid and spending, especially as the government is not aware of all the aid available to finance the provision of public goods. Three generalisations are permitted by the evidence: aid finances government spending; the extent to which aid is fungible (can be substituted with other resources) is over-stated and even where it is fungible this does not appear to make the aid less effective; and there is no systematic effect of aid on tax effort. Beyond these conclusions the fiscal effects of aid are country specific.
In 2010, vast humanitarian crises from Haiti to Pakistan almost overwhelmed the international system’s ability to respond. Despite years of reform, United Nations (UN) agencies, external funders, and international NGOs (INGOs) struggled to cope. In 2011, Somalia yet again saw a response too little and too late, driven by media attention, not a timely, impartial assessment of human needs. At the same time, humanitarian action is needed now more than ever, Oxfam argues. The growing number of vulnerable people, the rise in disasters, and the failure to put most fragile states on the path to development, will significantly increase needs. Western-based external funders, INGOs and the UN provide only part of the answer. Already, new external funders and NGOs from around the world provide a significant share of humanitarian aid. Future humanitarian action will rely on them, and on the governments and civil society of crisis-affected countries even more. The UN and INGOs will be vital, but the author argues that their contribution will increasingly be measured by how well they complement and support the efforts of others and uphold humanitarian principles.
As aid diminishes in importance, the authors argue that governments need to improve the quality of their public spending. This paper suggests three organisational tools - independent ratings of spending systems, independent public service agencies, and sovereign development funds- as a means of assessing public spending.
With global funding for HIV/AIDS on the decline, Zimbabwe's innovative AIDS levy - a 3% tax on income - has become a promising source of funding for the country, with a dramatic increase in revenue collected in the past two years. For the year ending 31 December 2010, a total of US$20.5 million was collected in 2010 against $5.7 million the previous year. The National AIDS Council Board attributed the increase to improved revenue flows owing to improved political and economic stability in the country, which has created more jobs in the formal sector and improved tax remittances. Zimbabwe's economy has witnessed steady growth following the formation of the coalition government of Prime Minister Morgan Tsvangirai and President Robert Mugabe in 2009. Although the revenue figures for 2011 have not yet been audited, the National AIDS Council estimates it collected about $25 million.
Following the ARV roll out in South Africa, people living with HIV (PLHIV) experienced improved health that, in turn, affected their grant eligibility. The aim of this paper was to explore whether PLHIV reduced or stopped treatment to remain eligible for the disability grant from the perspectives of both PLHIV and their doctors. Researchers conducted interviews with 29 PLHIV and eight medical doctors working in the public sector, as well as three focus group discussions with programme managers, stakeholders and community workers, and a panel survey of 216 PLHIV receiving anti-retrovirals (ARVs). They found that unemployment and poverty were the primary concerns for PLHIV and the disability grant was viewed as a temporary way out of this vicious cycle. Although loss of the disability grant significantly affected the well-being of PLHIV, they did not discontinue ARVs. However, in a number of subtle ways, PLHIV "tipped the scales" to lower the CD4 count without stopping ARVs completely. Grant criteria were deemed ad hoc, and doctors struggled to balance economic and physical welfare when assessing eligibility. The researchers call on government to ensure that it provides sustainable economic support in conjunction with ARVs in order to make "positive living" a reality for PLHIV. A chronic illness grant, a basic income grant or an unemployment grant could provide viable alternatives when the PLHIV are no longer eligible for a disability grant.