Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Integrating Financing Schemes to Achieve Universal Coverage in Thailand:

Analysis of the Equity Achievements

Phusit PrakongsaiSupon Limwattananon

Viroj TangcharoensathienInternational Health Policy Program (IHPP)

Presentation to the 7thWorld Congress of Health Economics

Beijing International Convention Centre, Beijing, China

13 July 2009

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Background• By 2002, Thailand achieved universal coverage (UC) by

introducing a tax-funded health insurance scheme, the UC scheme, to approximately 47 million (~75%) of the population who were neither beneficiaries of SHI or Civil Servant Medical Benefit Scheme,

• Health care financing strategies of the UC policy:– removal of financial barriers to health services; – shift of the main source of HCF from OOP to general tax; – changing provider payment from historical allocations to

close-ended payments; – promoting the use of primary care by contracting a PCU

as the main contractor and gatekeeper.

• Benefit package of the UC scheme is quite comprehensive comprising OP, hospitalization, health promotion and disease prevention, most expensive health services, dental care, medicines and operations.

1945

2000

2002

Informal user fee exemption

1980

1970

User fees

1-3rd NHP1962-76Provincial hospitals

Health Infrastructure extension--wide geographical coverage

Evolution of achieving universal coverage in Thailand:

Infrastructure development + financial protection extension

1975LIC

1990

Establishment of prepayment schemes

1983CBHI

1980CSMBS

1990SSS

Universal Coverage

CSMBS

2002 full achieve

Universal Coverage

SSS

LIC MWS 1994Pub VHI

CSMBS

SSS

Expansion consolidation of prepayment schemes

4th -5th NHP (1977-86) District hospitalsHealth centers

Health care finance and service provision of Thailand

after achieving universal coverage (UC)

General tax

General tax Standard Benefit

package

Tripartite contributions Payroll taxes

Risk related contributions

Capitation

Capitation & global Co-payment budget with

DRG for IP

Services

Fee for services Fee for services - OP

Population Patients

Ministry of Finance - CSMBS(6 million beneficiaries)

National Health Insurance Office The UC scheme (47 millions of pop.)

Social Security Office - SSS(9 millions of formal employees)

Voluntary private insurance

Public & Private Contractor networks

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Scheme beneficiaries by income quintiles, 2004

4% 1%

25%7%

5%

25%

11% 14%

23%

26% 31%

17%52% 49%

10%

0%

20%

40%

60%

80%

100%

CSMBS SSS UC

Q1 (poorest) Q2 Q3 Q4 Q5 (the richest)

Total health expenditure 1994-2005

0

50,000

100,000

150,000

200,000

250,000

300,000

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Mil

. B

aht

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

4.50%

%G

DP

public private %GDP

Total health expenditure during 2003-2005 ranged from 3.49 to 3.55% of GDP, THE per capita approx 100 USD

36

64

36

64

3737

63635656

4444

Achieving UC

4545

5555

46

54

53

4747

5355

45

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

8.2

4.8

3.7 3.7

2.92.6 2.5

2.01.6

1.32.2

1.8 1.8 1.6 1.4 1.4 1.3 1.4 1.2 1.10

1

2

3

4

5

6

7

81992

1994

1996

1998

2000

2002

2004

Household OOP for health, % income 1992-2004

Distribution of ambulatory services at different health facilities between the 2001 and 2003 HWS

1.2 1.0 0.7 0.5 0.1

1.91.3

0.7 0.60.2

0.70.6

0.4

0.20.2

1.8

1.3

0.90.7

0.3

0.70.6

0.7

0.7

0.6

0.4

0.4

0.30.4

0.3

0.3

0.40.4

0.5

0.6

0.7

0.6

0.60.7

0.6

0

1

2

3

4

5

6

Q1 Q2 Q3 Q4 Q5 Q1 Q2 Q3 Q4 Q5

Income quintiles

Am

bu

lato

ry v

isit

s p

er

ca

p p

er

ye

ar

Health centre Community hospital Provincial and regional hospital Private clinic Private hospital

The distribution of ambulatory service use among different income quintiles in 2001 and 2003, by types of health facilities

2001 2003

Concentration index

Type of health facilities 2001 2003

Health centers - 0.2944 - 0.3650

Community hospitals - 0.2698 - 0.3200

Provincial and regional hospitals - 0.0366 - 0.0802

Private hospitals 0.4313 0.3484

Source: Prakongsai P (2008). The Impact of the Universal Coverage Policy on Equity of the Thai Health Care system.

Equity in utilization: Concentration Index of OP service

by type of health facilities: 2001 to 2005

9

Note: CI range from -1 to + 1. Minus 1 (plus 1 ) means in favour of the poor (rich), or the poor (rich) disproportionately use more services than the rich (poor).

-0.50

-0.40

-0.30

-0.20

-0.10

0.00

0.10

0.20

0.30

0.40

0.50

2001 2003

2004 2005

2001 -0.294 -0.271 -0.037 0.431 -0.090

2003 -0.365 -0.315 -0.080 0.348 -0.139

2004 -0.345 -0.285 -0.119 0.389 -0.163

2005 -0.380 -0.300 -0.100 0.372 -0.177

Health centre Community hosp Provincial hosp Private hosp Overall

Equity in utilization: Concentration Index of hospitalization by type of health facilities: 2001

to 2005

10

-0.4

-0.3

-0.2

-0.1

0

0.1

0.2

0.3

0.4

0.5

Co

nc

ind

ex

2001 2003

2004 2005

2001 -0.316 -0.069 0.32 -0.079

2003 -0.293 -0.138 0.309 -0.121

2004 -0.294 -0.114 0.254 -0.127

2005 -0.266 -0.156 0.366 -0.114

Community hospitalsProvincial and regional

hospitalsPrivate hospitals Overall

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Equity in budget subsidies: BIA, 2001 and 2003

A comparison of percent distribution of net government health subsidies among different income quintiles in 2001 and 2003

28

20

17 17 18

31

22

1516

15

0

5

10

15

20

25

30

35

Q1 Q2 Q3 Q4 Q5

Income quintile

perc

ent

2001

2003

Note: -Overall net government health subsidies in 2001 were approximately 58,733 million Baht, and in 2003 were 80,678 million Baht (in 2001-value)- The concentration index of government health subsidies in 2001 was -0.044 and in 2003 was -0.123

The incidence of catastrophic health payments from 2000 to 2007

2000 2002 2004 2006 2007

Q1(poorest)

4.0% 1.7% 1.6% 0.9% 1.9%

Q5(richest)

5.6% 5.0% 4.3% 3.3% 2.8%

All quintiles 5.4% 3.3% 2.8% 2.0% 2.2%

Note: Catastrophic health expenditure refers to household out-of-pocket payments for health exceed 10% of household consumption expenditure

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Kakwani indexes of different health care finance from 2000 to 2006

(Kakwani = Conc. Index – Gini)

  2000 2002 2004 2006

Out of Pocket -0.1502 -0.0755 -0.0764

-0.0450

Direct tax 0.3913 0.4159 0.4424 0.3617

Indirect tax -0.0964 -0.0691 -0.0435

-0.0831

Premium Insurance -0.3623 -0.3906 -0.3233 na

Social health Insurance Contribution 0.1650 0.1121 0.1046 na

Premium Insurance+SHI Contribution na na na

-0.0491

13

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Discussion• Health financing reform strategies of the UC policy

improved equity in health care use (both ambulatory and hospitalization) and financial risk protection.

• Health care use of government health facilities was pro-poor before UC, and was getting better after UC implementation.

• Health services at primary and secondary care levels were more pro-poor than tertiary care and private facilities.

• Out-of-pocket payments for health tended to be less regressive after the UC policy was implemented. – The Kakwani indexes of OOPs significantly decreased from -

0.1502 in 2000 (prior to UC) to - 0.0450 in 2006.

14

How equity and efficiency were achieved?

1. Long term financial sustainability

2. Technical efficiency, rational use of services at primary health care

Functioning primary health care at district level, wide geographical coverage of services, referral back up to tertiary care where needed, close-to-client services with minimum traveling cost

In-feasible for informal sector (equally 25% belong to Q1 and Q2) to adopt contributory scheme

1. Equity in financial contribution Tax financed scheme,

adequate financing of primary healthcare

2. Minimum catastrophic health expenditure 3. Minimum level of impoverishment

Breadth and depth coverage, comprehensive benefit package, free at point of services

4. Equity in use of services 5. Equity in government subsidies

Provider payment method: capitation contract model and global budget + DRG

EQUITY GOALS

EFFICIENCY GOALS

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

16

Concluding remarks 1/2

• Enabling factors for achieving UC – Strong political supports

– Health systems capacity and its resilience to rapid nation-wide program scale-up in 6 months

– Lessons from predecessors • SHI capitation contract model

• CSMBS “no go” fee for service, due to cost escalation and inefficiencies

• Voluntary Health Card Scheme – adverse selection and non-viable financially

– Linking evidence to policy decision• Integral relationship among researchers – reformists – politicians

– Pragmatism • Limited chance to achieve UC by contributory scheme, especially

among informal sector, not feasible for contribution collection and enforcement

• Learning from SHI, UC takes further advanced steps, – Well thought systems design towards efficiency, cost

containment, ensure referral, advocates of primary care contractor

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

17

Concluding remarks 2/2• UC Schemes covers the poor, half belongs to Q1 and Q2

– However, the Scheme faced chronic under-funding, capitation was below than the proposed figures based on cost and utilization

– Significant increase in utilization more on OP than IP

– In view of under-funding and increased utilization danger of poor quality of services and serious hospital financial constraints

• Empirical evidence indicates – Pro-poor budget subsidy, DHS is a major hub of fostering the

pro-poor nature of financing healthcare • Policy msg. invest more in DHS

– (further) reduction in the incidence of catastrophic illnesses

– (further) reduction of impoverishment from medical bills

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Key challenges of the Thai health care system

• Long-term sustainability of health care finance for the UC scheme and overall health care finance,

• An increasing disease burden from chronic NCD and the situation of aging society,

• Inefficiency and inequitable access to good quality of health services among beneficiaries of different health insurance schemes,

• Low level of health care finance for health promotion and disease prevention,

• Poor governance of health systems in Thailand,• The unknown impact of economic crisis on health of the

Thai population,• The pandemic of new emerging infectious disease and

unsuccessful control of tuberculosis and HIV/AIDS,• Mal-distribution and internal brain drain of human

resources for health.

18

Inte

rna

tio

na

l H

ea

lth

Po

lic

y P

rog

ram

-T

ha

ila

nd

Inte

rnati

onal H

ealt

h P

olic

y P

rogra

m -

Thaila

nd

Thank you for your attention