Health Care Around the World

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Healthcare Spending in Indonesia

April 5, 2012 in Health Care Around the World, International Health Care Systems, Public Health | 2 comments

A recent J Health Econ paper describes the changes to the system of public health financing in Indonesia.  Today, I review this article.

Public Health Expenditures in Indonesia

In the Suharto Regime, district health offices implemented centrally determined policies, and “a large network of public health clinics (puskesmas) was set up to deliver primary outpatient care. In 2001, Indonesia’s health sector decentralized, following far-reaching reforms that involved fiscal, administrative and political decentralization.”

Under the current decentralized systems, districts have a lot of autonomy.  Districts are free to set user fees for public health and medical services and call allocate resources to any public health program they wish without having to justify their spending patterns to the central government.

Indonesia still does have some centralist features.

“The central government sets employment conditions for civil servants, including those working in public health service providers financed by district governments. It also finances and runs social safety net programs for the poor, such as targeted price subsidies for public care. Total health spending is split almost evenly between the central/provincial level on one hand and the district level on the other hand; in 2005, they accounted for 48% and 52% of public health expenditures respectively.”

Most of the districts funding come from the central government.  The funding comes from three major sources:

  • 56% general allocation grant (Dana Alokasi Umum – DAU)
  • 12%: shared non-tax revenues (i.e., natural resource revenues)
  • 11%: shared tax revenues (i.e., property and income taxes)
  • 3%: Specific allocation grant (Dana Alokasi Khusus – DAK)

The district’s own revenues fund about 10% to 16% of expenditures in the district.

Decentralization lead to a significant increase in public health spending.  Between 2001 and 2004 overall public health spending increased from 9,251 billion Indonesian Rupiah (IDR) to 16,703 IDR, a 21.8% average annual increase.

The question is, does this increased funding lead to increased public health spending at the district level and increased utilization.

 

Literature

Filmer and Pritchett (1999) note the lack of correlation between public health spending and child mortality and conclude that governance, or the way in which resources translate into actual programs, and crowding out of the private sector by the public sector are the missing chains that explain the low correlation.

McGuire (2006) shows that in a cross section of developing countries, access to maternal and infant health programs is correlated with decreased under 5 mortality, while public health spending is not. This indicates that it is the quality of the implemented programs that matter, and not the spending per se.

Kruse et al. Findings

Using panel data from 207 Indonesian districts between 2001 and 2004, a paper by Kruse et al. finds that the large increases in transfers from the central government large resulted in increased health spending by the district.  The authors estimate an elasticity of 0.9 (i.e., the district would spend $90 out of the $100 transfer from the central government on public health services).

The authors do not find significant crowd-out; increased public health spending does not reduce the private provision of medical services.  Increased public health spending also appear to increase health care utilization, particularly for poorer individuals.

Sources

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Good News in the Fight Against HIV

March 12, 2012 in Health Care Around the World, Health Care in Developing Nations, Public Health | No comments

Almost one in five South Africans have HIV.  South Africa is the country with the most individuals living with HIV (5.6 million); it also has the most HIV deaths annually (310,000).

Despite these grim facts, there is some good news.  The Economist reports:

“Although the number of South Africans living with the disease continues to rise…the tally of new cases each year has tumbled by half since 1999—thanks largely to a dramatic increase in the use of condoms, according to new research…

 National surveys show the proportion of young South African men aged 16-24 who reported using a condom at their last sexual encounter leaping from 20% in 1999 to 75% in 2009. This, more than an equally dramatic rise in anti-retroviral treatment, is the “most significant factor” in the fall of new infections, say the British and South African authors of the study.”

Let’s hope the South Africa has truly turned the corner.

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Spain: Modernist Architecture, Economic Crisis, and Hospital Cuts

September 12, 2011 in Current Events, Health Care Around the World | 1 comment

One stop on my vacation was Barcelona, Spain.  Barcelona is well known for amazing architecture, in particular by Antoni Gaudí.  One other modernist site I visited was El Hospital de Sant Pau.  Designed by Lluís Domènech i Montaner, the hospital is a World Heritage Site.  Altough part of the hositpal is being converted into a museum, other parts of the hospital still function.

Spain’s economic crisis (and in Spain the news constantly refers to their current economic situtation as a crisis) however has put significant economic strain on all types of public services, including hospitals. El Hospital de Sant Pau, the oldest in Barcelona, is having to cut its workforce.  The hospital has a deficit of more the than 10 million Euros ($13.6 USD) and although there are no official layoffs, 825 workers will need to take a mandated furlough to reduce the deficit.

When I was there, workers were protesting that health care is not negotiable and the cuts should be reversed.  With Spain’s current economic situation, however, more health care cuts are likely on their way.

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Why are more than 35 percent of elderly Swedes on disability?

May 31, 2011 in Health Care Around the World, International Health Care Systems | 1 comment

“The proportion of men collecting disability benefits at older ages varies greatly across countries — for example, more than 35 percent of 64-year-old men in Sweden and more than 25 percent of those in the Netherlands are on DI, versus 10 percent or less in Belgium, Italy, and Spain. Does this reflect differences in the underlying health status of older individuals in these countries? Or do differences in the provisions of the DI systems explain this variation in DI take-up rates?”

This is the question the Milligan and Wise attempt to answer in their Introduction to Social Security and Retirement around the World.  The Healthcare Economist suspects the answer is the latter.  Most people consider a quadriplegic disabled and those who are fully healthy are not disabled.  Many individuals, however, have partial disability. Many workers, for instance, suffer from back pain.  Measure the severity of the back pain is typically very difficult; some workers can continue working in physically strenuous jobs, others could continue to work in less physically strenuous jobs (e.g., blogging?), and for a minority the back pain is so severe that working at all is not feasible.  Because partial disability is not only common but also difficult to verify, public programs leniency regarding disability program eligibility likely affects the number of beneficiaries more than the underlying health status of the country.

Sure enough, Milligan and Wise come to the same conclusion.  Using “natural experiments” in which a country’s disability insurance reforms were not prompted by changes in health status or by changes in the employment circumstances of older workers, the researchers find that reforms have a large effect on the labor force participation of older workers.

Source:

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International Healthcare Models: Sweden, Norway and Finland

June 22, 2010 in Health Care Around the World | 1 comment

Here is my earlier review on Norway.  The information below on Sweden and Finland has not yet been presented before in my blog.

SWEDEN

Hospitals

  • There are 4 types of medical facilities: local health centers, county level hospitals, district level hospitals, and regional teaching hospitals.
  • Local health centers are staffed by GPs, nurses, midwives, occupational therapists, social workers and psychologists.
  • Citizens can pick their own local health center and their own physician.

HIT

  • 98% of Swedish GPs have computerized practices
  • 90% use electronic medical records.
  • Patients can provide physicians with necessary information before the visit using the patient’s Smart card.

Malpractice

  • The Scandinavian model is built on the premise of no-fault liability.
  • About 3 patients file a malpractice claim for every 1 in the U.S.
  • Awards payments come from a compensation fund supported by tax revenues.

FINLAND

Hospitals

  • Finland is divided into 20 hospital districts, each with 1 central hospital with more sophisticated technology and several satellite hospitals.
  • Of the central hospitals, 4 are university hospitals with the most specialized care.
  • Municipal health centers serve the majority of each community’s health needs. 

Funding

  • Funding is very decentralized.  The central government only paid for 18% of care in 2000.  The municipalities pay for the majority of care.

Malpractice

  • Similar to the Swedish system

NORWAY

Insurance

  • Has a centralized system, like Canada.
  • The National Insurance scheme covers all citizens.
  • No private insurance exists

Funding

  • The National Insurance Scheme is funded by general tax revenues. 

Physicians

  • Most physicians work are paid via capitation.  The capitation rate is based on the number of patients who have chosen a doctor to be their primary physician. 
  • Some specialists do work on a fee-for-service basis.

Malpractice

  • Similar to the Swedish system

Source: Roth, WF (2010) Comprehensive Healthcare for the U.S.: An Idealized Model. Productivity Press, 174 pages.

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International Healthcare Models: Germany

June 17, 2010 in Health Care Around the World | 1 comment

Here is my previous review of the German healthcare system.  Below is the some additional information on medical care in France based on the book by William Roth.

Funding and Insurance

  • An individual joins a sickness funds to receive medical coverage.  The sickness funds cover 90% of the population and the remaining 10% uses private insurance.
  • Employers and employees split the sickness fund premiums.  Employee payroll deductions for sickness fund premiums typically range between 9%-17% of income.
  • Those over 65 years old and the unemployed have the entire cost of the sickness fund paid for by the government.
  • The sickness fund sets the charges  for each procedure.

Physicians

  • Physician are paid on a fee-for-service basis.
  • Members of sickness funds can go to any physician they wish.
  • The government limits the number of providers in each field.
  • Competitive exams are taken to see who is accepted into healthcare training and who gets to specialize.  Medical education, however, is free.
  • GP students serve a residency followed by an apprenticeship with a licensed GP.
  • Physician ratio – 1:1170

HIT

  • Germany spends 8.6% of its annual healthcare budget on technological innovations.
  • The country is currently developing an electronic health cared to allow them to access the information on their electronic health record.

Source: Roth, WF (2010) Comprehensive Healthcare for the U.S.: An Idealized Model. Productivity Press, 174 pages.

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International Healthcare Models: Rwanda

June 16, 2010 in Health Care Around the World | No comments

The New York Times recently discussed the Rwandan model of healthcare.  According to the article, “Rwanda has had national health insurance for 11 years now; 92 percent of the nation is covered, and the premiums are $2 a year.”  By comparison, in the U.S. only 85% of people have health insurance and premiums costs thousands or even tens of thousands of dollars.

The tone of the article can be summed up by the sentiments of college student.  Sunny Ntayomba a Rwandan working for the N.Y. Times in Kigali said that the student found it “absurd, ridiculous, that I have health insurance and she didn’t…if she got sick, her parents might go bankrupt. The saddest thing was the way she shrugged her shoulders and just hoped not to fall sick.”

The reality is, however, that Americans could certainly afford health insurance for Rwandan-style medicine.  Insurance covers treatment for diarrhea, pneumonia, malaria, malnutrition, infected cuts, which are the most common causes of death in Rwanda.

It does not cover  care such as M.R.I.s and dialysis.  Further, diseases such as cancer, strokes and heart attacks are often death sentences. “The whole country, with a population of 9.7 million, has one neurosurgeon and three cardiologists.”  Most Americans could afford insurance that just covered primary care.  The problem in the U.S. is not that people can’t afford any medical care; it’s that they can’t afford the medical care typically practiced in the U.S.  Would you rather be sick in the U.S. without insurance or sick with insurance in Rwanda?

Providers

  • Typically practice in small clinics

Insurance

  • Health insurance is known as health mutuals
  • Health insurance only costs $2 per year.
  • Most services have a co-pay (e.g., a Caesarean has a $5 co-pay)

Statistics (from CIA World Factbook)

  • Infant Mortality is 65.6/1000, ranking 199th in the world.
  • Life Expectancy at birth is 57.5 year, 193rd in the world
  • 2.8% of adults (aged 15-49) are currently living with HIV/AIDS, 26th worst in the world
  • Major infectious diseases: bacterial diarrhea, hepatitis A, typhoid fever, and malaria.

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International Healthcare Models: France

June 15, 2010 in Health Care Around the World | 1 comment

Here is my previous review of the French healthcare system.  Below is the some additional information on medical care in France based on the book by William Roth.

Physicians:

  • Physicians generally work out of their own practices rather than in health centers.
  • Physicians choose whether to work in the private sector or public sector.  They cannot work in both.
  • Patients can go to any physician they want among those who work in the public sector.  Those with private insurance can go to any doctor in either the public or private sector.
  • Public physicians are salaried government employees.
  • Private sector physicians operate on a fee-for-service basis.
  • Physician ratio: 1:330

Malpractice:

  • The system is a mix of fault and no-fault.  The general trend over time, however, is towards a no-fault system.
  • Compensation levels for no fault decisions are regulated.
  • Awards come from a national compensation fund supported by premiums.
  • Private practitioners must by malpractice from a private firm.

Hospitals

  • There are 3 types of hospitals: local hospitals provide general care but no surgery, regional hospitals provide more specialized care, and general hospitals provide the widest range of services (e.g., surgery, rehabilitation, LTC).

Funding

  • Payroll taxes fund must of the public sector medical expenses, although there is a shift lately towards general tax revenues.
  • Individuals who want private medical care purchase private health insurance.  Private insurance is an “add-on” to the public insurance, not a replacement.
  • Patients pay for the full cost of treatment upon receipt.  Their local health insurance department reimburses them for the covered expense.

HIT

  • All French citizens carry computerized Smart Cards containing all their medical background.

Source: Roth, WF (2010) Comprehensive Healthcare for the U.S.: An Idealized Model. Productivity Press, 174 pages.

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International Healthcare Models: Canada

June 14, 2010 in Health Care Around the World | 3 comments

Here is my previous review of the Canadian system.  Below, I will include additional information on healthcare in Canada based on the book by William Roth.

Insurance

  • Government-funded insurance covers the majority of Canadians.
  • Private insurance was recently made legal in Canada, but private insurance is still held by a very small proportion of the population.

Physicians

  • Physicians work on a fee-for-service basis.
  • Providers bill the province electronically.
  • 60% of Canadian physicians practice in the primary care setting compared to 30% in the U.S.
  • Medical school costs about half of what it does in the U.S.

Funding

  • Premiums and tax revenues for medical care are collected by provinces.

Regulation

  • The cost of each procedure is negotiated between the provincial government the local medical association.
  • Procedures deemed “not necessary” are not covered by government insurance.

HIT

  • Is in the process of creating EHR for all citizens using a standardized format.
  • Physicians can check medication histories and order medications online.
  • A Chronic Disease Management Infostructure (CDMI) is being created to predict trends and allocate resources more efficiently.

Source: Roth, WF (2010) Comprehensive Healthcare for the U.S.: An Idealized Model. Productivity Press, 174 pages.

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International Healthcare Models: An Introduction

June 14, 2010 in Health Care Around the World | 3 comments

In the past, I have reviewed the healthcare systems of a variety of countries in my Health Care Around the World series.  This week, I will revisit the healthcare systems of a number of these countries using a new source.  The source is Comprehensive Healthcare for the U.S.: An Idealized Model by William F. Roth.  Overall, this book attempts to construct an idealized model for the U.S. taking the best aspects from health care in other countries.  Although this is a fun exercise, it is completely inpracticable.  There are a lot of aspects of the U.S. system which are far from ideal, but a realistic way to improve the current American system would be to build on the existing infrastructure rather than attempting to rebuild the system from scratch.

The most interesting part of the book is not who Dr. Roth attempts to redesign the healthcare system, rather it is his discussion of the healthcare systems around the world.  Dr. Roth’s review are not comprehensive, but rather they highlight some of the more interesting aspects of each country’s healthcare system.  Using this book as a source, I will review how health care is delivered in the following countries:

Source: Roth, WF (2010) Comprehensive Healthcare for the U.S.: An Idealized Model. Productivity Press, 174 pages.

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