Resource allocation and health financing

Modelling the impact of raising tobacco taxes on public health and finance
Goodchild M; Perucic AM; Nargis N: Bulletin of the World Health Organisation 94(4), 233-308

This study investigated the potential for tobacco taxes to contribute to the 2030 agenda for sustainable development by reducing tobacco use, saving lives and generating tax revenues. A model of the global cigarette market in 2014 – developed using data for 181 countries – was used to quantify the impact of raising cigarette excise in each country by one international dollar (I$) per 20-cigarette pack. All currencies were converted into I$ using purchasing power parity exchange rates. The results were summarized by income group and region. According to the study model, the tax increase would lead the mean retail price of cigarettes to increase by 42% – from 3.20 to 4.55 I$ per 20-cigarette pack. The prevalence of daily smoking would fall by 9% – from 14.1% to 12.9% of adults – resulting in 66 million fewer smokers and 15 million fewer smoking-attributable deaths among the adults who were alive in 2014. Cigarette excise revenue would increase by 47% – from 402 billion to 593 billion I$ – giving an extra 190 billion I$s in revenue. This, in turn, could help create the fiscal space required to finance development priorities. For example, if the extra revenue was allocated to health budgets, public expenditure on health could increase by 4% globally. The authors argue that tobacco taxation can prevent millions of smoking-attributable deaths and create the fiscal space needed to finance development, particularly in low- and middle-income countries.

#FeesMustFall and the campaign for universal health coverage
Doherty J; McInytre D: The South African Medical Journal 105(12), 1014-1015, 2015

This article reflects on how #FeesMustFall highlighted the political and social upheaval that results from extreme income inequity and inequitable access, problems that beset the health sector as well. It presents data showing how per capita health expenditure declined for a decade after 1994, despite the burgeoning HIV/AIDS epidemic, a blow from which the health system is still trying to recover. The underlying reason for this was a macroeconomic policy that placed constraints on taxation and government expenditure on social services. The article shows how South Africa (SA)'s tax-to-GDP ratio is much lower than other middle-income countries, and argues that raising this limit is essential for development. Spending on health and education should be seen as an investment in the SA economy. The authors suggest that the Department of Health needs to argue this case in Cabinet and demonstrate the effectiveness of health spending through efficient service delivery and fighting corruption.

White paper: National Health Insurance for South Africa
Department of Health, Republic of South Africa, December 2015

This white paper outlines South Africa’s path to universal health coverage over 14 years and proposes dramatic changes in the role of private medical aid among others. Released on the 10th of December 2015, the long awaited white paper begins by providing the background and justification of the country’s moves to join other countries like the Brazil, the United Kingdom and Thailand in introducing universal healthcare coverage. The document notes that healthcare in South Africa is comprised of a two-tiered system divided along socio-economic lines. The private medical aid sector is comprised of 83 medical aid schemes that fund healthcare services for about 16 percent of the population. The paper noted that spending through medical schemes in South Africa is the highest in the world and is six times higher than in Organisation for Economic Co-operation and Development (OECD) countries. The paper argues that this two-tiered system has led to fragmented funding and risk pools in healthcare and posits that the creation of a National Health Insurance (NHI) will improve healthcare equity by combining fragmented private and public health funding pools and eliminating out-of-pocket payments.The paper notes that the NHI will ultimately deliver a comprehensive package of health services that include services such as rehabilitation and palliative care, mental health care including that related to substance abuse and maternal and child health care. The paper is made available to call for stakeholder feedback.

A Global Fund for Social Protection Floors: Eight Good Reasons Why It can Easily be Done
Chichon M: United Nations Research Institute for Social Development (UNRISD), Think Piece, 2015

The author argues that social protection is the most direct tool we have to combat poverty and inequality and that implementation can begin when countries are at a relatively early stage of development. However, there are today a few countries which need the solidarity of others to close the social protection gap. This think piece puts forward eight good reasons why a global fund for social protection is needed and can easily be initiated. Here are eight good reasons why a global fund for social protection floors is needed and can easily be initiated, which the author elaborates on more fully in his think piece: there already is a global consensus on social protection floors for all, the global community has already accepted that global solidarity may be needed to achieve social protection for all, there is no need to create a new fund, there already is one that can be used, the mandate and the supervisory mechanism for the fund do not have to be invented and the fund can start modestly, the potential direct impact on poverty could be huge.

Equity and Noncommunicable Disease Reduction under the Sustainable Development Goals
Bangura Y: United Nations Research Institute for Social Development (UNRISD), Think Piece, 2015

Africa has enjoyed a growth momentum since 2000 after the wasted years of the 1980s and much of the 1990s. However, eradicating poverty will require huge resources, which existing funding strategies will be unable to generate. Global commodity prices have fallen sharply; capacity to mobilise domestic revenues is waning; and aid has been insufficient in plugging funding gaps. Revenue bargains in which states extract revenues from citizens in exchange for investments that impact positively on well-being may be key to financing Africa’s development. They can substantially increase revenues, nurture effective state-citizen relations, force companies to pay correct taxes, push fragmented systems of service provision in the direction of universalism, improve policy space and make aid more effective.

Improving financial access to health care in the Kisantu district in the Democratic Republic of Congo: acting upon complexity
Stasse S; Vita D; Kimfuta J; da Silveira VC; Bossyns P; Criel B: Global Health Action 8(25480), 2015

Commercialisation of health care has contributed to widening inequities between the rich and the poor, especially in settings with suboptimal regulatory frameworks of the health sector. Poorly regulated fee-for-service payment systems generate inequity and initiate a vicious circle in which access to quality health care gradually deteriorates. Although the abolition of user fees is high on the international health policy agenda, the sudden removal of user fees may have disrupting effects on the health system and may not be affordable or sustainable in resource-constrained countries, such as the Democratic Republic of Congo. Between 2008 and 2011, the Belgian development aid agency (BTC) launched a set of reforms in the Kisantu district, in the province of Bas Congo, through an action-research process deemed appropriate for the implementation of change within open complex systems such as the Kisantu local health system. Moreover, the entire process contributed to strengthen the stewardship capacity of the Kisantu district management team. The reforms mainly comprised the rationalisation of resources and the regulation of health services financing. Flat fees per episode of disease were introduced as an alternative to fee-for-service payments by patients. A financial subsidy from BTC allowed to reduce the height of the flat fees. The provision of the subsidy was made conditional upon a range of measures to rationalise the use of resources. The results in terms of enhancing people access to quality health care were immediate and substantial. The Kisantu experience demonstrates that a systems approach is essential in addressing complex problems. It provides useful lessons for other districts in the country.

Financing sustainable development and developing sustainable finance: A DESA Briefing Note on the Addis Ababa Action Agenda
Third International Conference on Financing for Development, Addis Ababa, Ethiopia, 13-16 July 2015

Achieving the 2030 Agenda for Sustainable Development requires trillions of dollars annually. The authors indicate that global public and private investment would be sufficient – but only if financial resources were invested in and aligned with sustainable development. This requires a comprehensive approach, which mobilises public finance, sets appropriate public policies and regulatory frameworks, unlocks the transformative potential of people and the private sector, and incentivises changes in consumption, production and investment patterns in support of sustainable development. The Addis Ababa Action Agenda (AAAA) presents a policy framework that realigns financial flows with public goals. Official development assistance (ODA) remains crucial, particularly for countries most in need, but alone is not be sufficient. The AAAA addresses all sources of finance: public and private, domestic and international and stresses the importance of long-term investment, and the need for all financing to be aligned with sustainable development. It includes several new commitments by Governments: A new social compact to provide social protection and essential public services for all; A global infrastructure forum to bridge the infrastructure gap; An ‘LDC package’ to support the poorest countries; A Technology Facilitation Mechanism to advance to the SDGs; Enhanced international tax cooperation to assist in raising resources domestically; Mainstreaming women’s empowerment into financing for development. Additional cross-cutting issues include scaling up efforts to end hunger and malnutrition, promoting inclusive and sustainable industrialisation, full and productive employment and decent work for all, peaceful and inclusive societies, and protecting the ecosystem.

Inequity in costs of seeking sexual and reproductive health services in India and Kenya
Haghparast-Bidgoli H et al: International Journal for Equity in Health 14(84), 2015

Information on access to SRH services, the direct costs of seeking care and a range of socio-economic variables were obtained through structured exit interviews with female SRH service users in Mysore (India) and Mombasa (Kenya). The costs of seeking care were analysed by household income quintile (as a measure of socio-economic status). The Kakwani index and quintile ratios are used as measures of inequitable spending. Catastrophic spending on SRH services was calculated using the threshold of 10 % of total household income. The results showed that spending on SRH services was highly regressive in both sites, with lower income households spending a higher percentage of their income on seeking care, compared to households with a higher income. Spending on SRH as a percentage of household income ranged from 0.03–7.5 % in Kenya, with a statistically significant difference in the proportion of spending on SRH services across income quintiles. The poorest households in Kenya spent ten times more on seeking care than the least poor households. The most common coping mechanisms were receiving [money] from partner or household members and using own savings or regular income. Highly regressive spending on SRH services highlights the heavier burden borne by the poorest when seeking care in resource-constrained settings.

Insights for taking Results Based Financing to scale
Health Partners International, Montrose International: Policy Brief, Northern Uganda Health, UK, August 2015

There is increasing interest in understanding how Results Based Financing (RBF) can improve efficiency, effectiveness and accountability in programming towards
Universal Health Coverage and improved health outcomes at scale. The Northern Uganda Health (NU Health) is a controlled implementation study to assess the costs and benefits of RBF relative to conventional Input Based Financing (IBF). The study design aimed to isolate the main effect of the financing modality in terms of quality and quantity of health service provision. Programme data and the results of an independent evaluation confirm a range of key findings. These include: A significant reduction in barriers to access and increase in health service utilisation; a three to eight fold improvement in adherence to standard treatment algorithms/quality of care for the major childhood killers: diarrhoea, malaria and pneumonia; and, particularly dramatic improvements in care and utilisation at the lowest level facilities, harbouring the promise of real progress toward Universal Health Coverage.

Revenue Bargains Key to Financing Africa’s Development
Bangura Y: United Nations Research Institute for Social Development (UNRISD), Think Piece, UNRISD, Geneva, 2015

Africa has enjoyed a growth momentum since 2000 after the wasted years of the 1980s and much of the 1990s. However, eradicating poverty will require huge resources, which existing funding strategies will be unable to generate. Global commodity prices have fallen sharply; capacity to mobilise domestic revenues is waning; and aid has been insufficient in plugging funding gaps. Revenue bargains in which states extract revenues from citizens in exchange for investments that impact positively on well-being may be key to financing Africa’s development. They can substantially increase revenues, nurture effective state-citizen relations, force companies to pay correct taxes, push fragmented systems of service provision in the direction of universalism, improve policy space and make aid more effective.

Pages