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CAMBODIA

Technical Note

Financial Assessment of A Social Health Insurance Scheme for Employees in the Public Sector

Draft v.1 for comments

January 2016

Table of Contents

1.Introduction 1

2. Scheme Description 4

3. Financial Assessment4

3.1 Methodology and assumptions 5

3.2 Projection results 5

3.3 Proposed contribution rates 5

4. Implementation 4

5. Conclusion and Recommendations 4

Annexes

Annex A. Provider Payment Mechanism

Annex B. Assumptions

Annex C. Projection results

Annex D. International Experience

1.Introduction

The assessment presented in this report was prepared with the financial support from the ILO-Korea Project on ‘Supporting the implementation of sustainable social protection floors for workers and their families in ASEAN’.

Social Security benefits provided to public employees in Cambodia currently include pensions in case of old-age, invalidity, and for survivors; sickness cash benefits, maternity benefits, funeral grants, and work injury benefits. The benefits for public employees have been managed by the National Security Fund for Civil Servants (NSSFC) and National Fund for Veterans (NFV) since 2008 and 2010 respectively.

Employees in the public sector and their families do not benefit from health insurance benefits at present, and thus bear all medical expenses and financial risk when they face illness. In the absence of health insurance coverage, public employees are exposed to financial hardship in case of catastrophic health events and expenditures.

The initiative of introducing a social health insurance scheme for public employees has been discussed since 2010. In 2011, a preliminary assessment of social insurance scheme for public and private employees was undertaken by the GIZ in cooperation with ILO, in this framework of the ‘Providing for Health’ (p4H) initiative. Due to lack of data and uncertainties over scheme design features at the time, the study resulted in highly preliminary estimations.

On 9th July 2014, the Government of Cambodia established, under the leadership of the Ministry of Economy and Finance (MoEF), a Technical Working Group aiming to develop and implement a Social Protection Policy Framework for Cambodia. The introduction of a National Health Insurance Scheme for Civil Servants is part of the reforms under consideration by the working group. Incidentally the National Social Security Fund for Private Employees (NSSF) is planning to implement a social health insurance scheme for private sector workers in the year 2016. In that context, the ILO provided earlier technical assistance notably in 2014 by undertaking an actuarial assessment summarized in a Technical Note on ‘Estimation of Contribution Rates for the Health Insurance, Maternity and Sickness Cash Benefits’ branch of the National Social Security Fund of Cambodia (ILO, Jan 2015).

At the time of writing, no final decisions have been made yet regarding the specific design features of the planned social health insurance scheme for public employees. However, it was suggested by MoEF to align the design features of the scheme closely with those adopted by the National Social Security Fund (NSSF) for the planned social health insurance branch for private employees; notably for the benefit package, provider network, and provider payment mechanism. During 2015 the MoEF formally requested technical assistance from the ILO to undertake an actuarial study of the planned scheme, which resulted in the assessment summarized in the present report. A workshop was organized by MoEF in October 2015 with ILO experts to discuss scheme design and clarify data requirements for the planned study. Preliminary results were presented to the MoEF for comments in November 2015.

The assessment presented in this report was undertaken jointly by Mr Jean-Claude Hennicot, Chief Technical Adviser, ILO Project on ‘Supporting the Establishment of the National Health Insurance

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Scheme in Lao PDR’, and Ms Khwanploy Cheechang, ILO Consultant, under the overall supervision of Mr. Nuno Cunha, Senior Social Protection Specialist, ILO Asia and Pacific Office.

The objective of this report is to present a financial assessment including an estimation of the contribution rates to be collected in order to finance medical benefits for employees in the public sector in Cambodia, including civil servants, police, pensioners as well as their dependents. Different scenarios on average and benefit packages are explored in the report.

The financial estimates presented in chapter 3 are based on the proposed design features of the planned health insurance scheme for public employees as discussed during a workshop in October 2015. Most of these features are borrowed from the NSSF health insurance branch, planned to be launched during 2016. The estimates provided are based on a broad range of assumptions made by authors based on data available for Cambodia, some proxy data from other countries, and the best knowledge and experience of the authors.

It must be stressed that the actual expenditure under the new benefit branch will only be known after the launch of the scheme since behavioural aspects are difficult to predict. This is particularly relevant for the phasing period (first 2-3 years), during which the beneficiaries gradually adjust their behaviour and make increasingly make use of their entitlements under the scheme. It is therefore relevant to allow for future adjustments of the contribution rate of the new benefit branch based on the future financing requirements and the development of its financial parameters, in particular insurable earnings, benefit expenditure, and accumulation of reserve funds. It is recommended that periodical actuarial reviews be conducted in order to assess the benefit experience and financial status of the scheme in order to reassess the adequacy of financing provisions and contribution rates of the scheme on a regular basis.

The report is organised as follows:

Chapter 2 presents a summary description of the planned health insurance scheme; Chapter 3 contains the financial assessment including the projection of expenditures and

proposed contribution rates; Chapter 4 addresses implementation issues and related guidelines and principles Chapter 5 presents the conclusions and recommendations of the report.

Data tables, assumptions, detailed projection results for all scenarios and some international experience from selected countries are displayed in the Annex of the report.

Acknowledgments are due to H.E. Madame Nguon Sokha, Secretary of State, for her support and leadership in the process, to H.E. Youk Bunna, Secretary of State, Ministry of Civil Service for his support and information on with civil servants, and to H.E. Ung Luyna, Deputy Director of Budget Department, for his assistance on clarifying data, and (to be completed). Special thanks are due to Malika Ok, National Project Coordinator, ILO, for her continuous support with translation, information gathering, and liaising with counterparts in Cambodia.

2.Scheme Description

The design of the planned health insurance scheme for employees of the public sector is based on the design features outlined below. While some of the details are still under discussion, it was suggested to use design features along the same lines of those adopted for the planned NSSF health insurance branch for private sector workers, the implementation of which is currently under preparation. Therefore reference is made here to the provisions outlined in the Prakas on Health Insurance Benefits as adopted in 2014 by Ministry of Labour and Vocational Training (MoLVT) for the health insurance branch for private employees to be implemented by the NSSF. Moreover, some of the features outlined are based on the outcome of discussions during a workshop with stakeholders on ‘Design of a Health Insurance Scheme for Civil Servants’ in September 2015, chaired by H.E. Madame Nguon Sokha, Secretary of State, Ministry of Economy and Finance.

2.1 CoverageThe target groups of the population to be potentially covered under the scheme include active civil servants, employees of the Armed Forces and Public Security (the Police), retirement and invalidity pensioners of the public sector (as registered with NSSF-C and NFV), and family dependents of these groups including one spouse and all children (under the age of 18) of the main insured. Four scenarios on coverage have been considered in the assessment presented hereunder in order to illustrate the cost of the scheme under alternative coverage assumptions. Due to the lack of data on armed forces (headcount, wages, and family dependents), this target group could not be included in the financial assessment. The potential total coverage including all target groups (excluding the Ministry of Defence) totals 683,552 persons (table 1).

Table 1: Target groups and headcount estimates, 2015

Coverage Persons Dependencyratio

Civil Servants (active) 187,175

Dependents of Civil Servants1 236,728 1.26

Civil Servants’ age and invalidity pensioners 46,751

Dependents of CS pensioners1 30,926 0.66

Employees of Min of Public Security 65,723

Dependents of MoPS employees1 94,894 1.44

Pensioners (age and invalidity) of MOPS 9,182

Dependents of MOPS pensioners1 12,173 1.33

Total 683,552

Notes:(1) Including dependent spouses and children under the age of 18

Source: Ministry of Civil Service, Ministry of Interior, NSSF-C, and NFV

2.2 Benefit package The proposed benefit package is based on the benefit package adopted by NSSF and described in the Prakas on Medical Benefits (MoLVT, 2014), which comprises curative medical services as available at contracted facilities, provision of drugs and medical consumables as prescribed, and preventive care as required (excluding preventive medical services already provided free-of-charge under MOH vertical programmes). Other services excluded are non-curative health care benefits such as cosmetic surgery, and sex-change operations; and high-cost drugs required in case of chronic diseases.1

In the financial assessment presented below, the expenditure of the scheme has been assessed for the following benefit packages:

Standard benefit package, comprising the following:

General Outpatient (ambulatory) Care, General inpatient services (hospitalization), Maternity-related admissions including deliveries, High cost treatments or diagnostic procedures including the following:

MRI scan, CT scan, Cancer Cell Analysis, Trepanation, Emergency care in case of heart attack, Radiotherapy and Chemotherapy, Cardiovascular surgery, Physiotherapy (course), Prosthetic limbs and medical implants.

Medical transportation including medical evacuation.

Optional benefits, which could be covered in addition, including:

Annual medical check-ups for members aged 40 and above Hemodialysis Open-heart surgery

The optional benefits listed above are generally quite costly, they are therefore considered for inclusion on an optional basis, i.e. their coverage may be excluded/included initially depending on cost or they may be covered on the basis of special provisions or restrictions.

2.3 Medical service providersMembers insured under the scheme will be entitled only to use medical services provided by facilities contracted by the scheme, and cannot claim reimbursement for medical services sought elsewhere, e.g. at private clinics and hospitals.

1 A detailed list of drugs to be made available to patients by facilities should be established to include all items listed in the essential drug list, plus additional items required and deemed affordable.

The network of providers to be contracted under the scheme for providing medical services to insured members will consist of public hospitals in Cambodia, including health centres, district hospitals, provincial hospitals, and national hospitals (classified as MPA, CPA1, CPA2, CPA3, and NH). The use of private providers may be authorized in emergency cases and for specific interventions, in particular high-cost treatments and/or diagnostic procedures not available in all public facilities.

Furthermore, it was suggested that all insured members will be granted freedom of choice over the providers where they want to seek care based on proximity, convenience, and/or personal preference. Hence there are no plans to adopt a mandatory referral system to act as a gate-keeping mechanism aiming to direct primary care patients to lower-level facilities.2

2.4 Provider payment mechanism It is assumed, as common for social health insurance schemes, that the scheme will act as the purchaser and contract directly with the service providers selected to provide medical services to insured members in accordance with contract stipulations and benefit package to be adopted. Hence benefits will be provided to insured members in-kind by the facilities, and facilities will claim reimbursement from the scheme based on the rates and provider payment mechanism agreed upon and specified in the contract.

It was suggested to use the same case-based provider payment mechanism adopted by NSSF, which comprises fixed fees payable for pre-defined ‘cases’ of care reflecting type of medical treatment (outpatient, inpatient, and maternity-related admissions) and cost category. Different rates apply for different types of service providers (MPA, CPA1, CPA2, CPA3, and national hospitals), reflecting the cost differentials among types of providers. The case-fees assumed for the different types of public providers are based on the rates stipulated in the Prakas on Provider Payment Mechanism (MOLVT, 2014), to be implemented by the NSSF health insurance branch (see table A.1, Annex A).

In addition to the case-fees, a selected list of treatments and diagnostic procedures considered of high-cost will be reimbursed separately on a fee-for-service basis but subject to a cap or maximum amount per case.

It is noted here that a case-based provider payment mechanism is considered as a good compromise, allowing both to compensate providers adequately for medical services provided, and to achieve a certain degree of cost-containment.

2.4 Financing The detailed financing arrangements for the planned scheme are yet to be agreed upon. The introduction of wage-based contributions (as common for social health insurance schemes) was suggested by MoEF, with a fixed contribution rate to apply universally for all members (regardless of wage level, health risks, and family size). Adopting a fixed contribution rate for all is an important

2 Noted here that in the absence of a gate-keeping mechanism, higher-level providers (in particular National Hospitals) may attract a disproportional share of patients and become overburdened. This is particularly relevant for ambulatory visits requiring primary care treatments that should normally be directed towards lower-level facilities.

feature of social health insurance schemes, which guarantees the ability to pay by all members within a certain target group of employees and affiliate members (e.g. pensioners and family dependents).3 Adopting a fixed contribution rate also creates an indirect cost-containment mechanism.4

The financing system generally recommended for social health insurance schemes is a pay-as-you-go (PAYG) financing system, for which a fixed contribution rate is set such as to balance income and expenditure of the scheme over a fixed period of time (3 - 5 years), and no major reserves are accumulated apart from a contingency reserve, the purpose of which is to cover unforeseen expenditures and to ensure the solvency of the fund at all times.5

It is assumed in the following that the scheme will be financed via contributions to be levied on all salaries paid to civil servants at a fixed rate, to be divided 50/50 between employer and employees. It is further assumed that pensioners covered under the scheme will only bear the employee portion (i.e. 50% of the total contribution rate).

3 In contrast to private health insurance schemes, for which premiums are fixed individually based on financial risk of each individual (or based on risk factors such as age and sex), social health insurance schemes are based on a broad risk pooling mechanism and therefore comprises implicit cross-subsidies between members of different risk status and income level. 4 While the contribution rate should be adjustable without requiring legislative amendments, it should normally be fixed at a constant level over periods of several years (3-5 years), and its adjustment should be subject to a consultative process that should involve the main stakeholders of the scheme. 5 As a general guideline, the contingency reserve should not exceed an amount equivalent to one year of scheme expenditures.

3. Financial Assessment

A financial assessment of the planned scheme is presented below based on the design features presented in section 2 and the data made available. Assumptions required for the financial estimations presented below were made based on the reference data available for Cambodia (in particular from HIP scheme), and based on proxy data from other schemes in the region (see Annex B). The main objective of the financial assessment is to estimate future expenditures and the pay-as-you go cost (PAYG) ratio, which reflects the ratio of benefit cost to total wage bills and constitutes the main indicator used for setting the contribution rate of the scheme.

3.1 Methodology and assumptions The methodology followed below for the estimation of the PAYG cost ratio and setting the contribution rate comprises the following steps:

Step 1: Projection of scheme coverage under different scenarios

Step 2: Estimation of benefit expenditure by age group and total benefit expenditure

Step 3: Projection of insurable earnings and total contribution base

Step 4: Estimation of the PAYG cost rate

Data was made available for the year 2015, which is the base year of the projections. All figures for later years (2016 – 2020) are projected figures.

Step1: Projection of scheme coverage under alternative coverage scenarios, 2016 - 2020

Data on public employees, pensioners, and family dependents was provided by the relevant ministries for the base year 2015 (see table 1). The scheme coverage was estimated according to four alternative coverage scenarios (table 2):

For Scenario 1, the assumed scheme coverage includes active civil servants, retired civil servants, and civil servants in receipt of a disability pension. The total number of covered persons is estimated at 233,926 in 2015 and project to increase to 255,330 in 2020.

For Scenario 2, the assumed coverage includes, in addition to those covered under scenario 1, all entitled family dependents, to include spouses and children under the age of 18. The total coverage under scenario 2 is estimated at 501,580 in 2015 and projected to increase to 547,475 in 2020.

For Scenario 3, the assumed scheme coverage includes civil servants, the National Police, and all related age- and disability pensioners. The total coverage is estimated at around 308,831 persons in 2015 and projected to increase to 337,089 in 2020.

For Scenario 4, the assumed coverage comprises in addition to those covered under scenario 3 all family dependents entitled, to include spouses and children under the age of 18. The total coverage is estimated at 683,552 in 2015 to increase to 746,097 in 2020.

Table 2.: Coverage scenarios 1-4, and headcount estimates, 2015

Scenario no. Target groups covered Persons Total coverage

1Active Civil Servants 187,175

233,926Retired Civil Servants (NSSF-C) 43,901Invalidity pensioners (NSSF-C) 2,850

2

Active Civil Servants 187,175

501,580

Dependent spouses of Civil Servants 63,188Dependent Children under 18 years of age 173,540Retired Civil Servants 43,901Invalidity pensioners (CS) 2,850Dependent spouses of pensioners 27,262Dep. children of pensioners (age < 18) 3,664

3


308,831

Retired Civil Servants 43,901Invalidity pensioners (CS) 2,850Employees of Min of Public Security (MoPS) 65,723Retirees from MoPS (NFV) 7,038Invalidity pensioners MoPS (NFV) 2,144

4


683,552

Dependent spouses of Civil Servants 63,188Dependent Children under 18 years of age 173,540Retired Civil Servants 43,901Invalidity pensioners (CS) 2,850Dependent spouses of CS pensioners 27,262Dep. children of pensioners (age < 18) 3,664Employees of National Police 65,723Dep. spouse of police men 30,852Dep. children of National Police (age < 18) 64,042Retired police men (NFV) 7,038Invalidity pensioners from police (NFV) 2,144Dep. spouse of Police pensioners 4,363Dep. children of Police pensioners (age < 18) 7,809

Sources: Ministry of Civil Service, Ministry of Public Security, NSSFC, NFV

The total scheme coverage was projected over the years 2016 – 2020 by assuming a net rate of increase equal to the current population growth in Cambodia estimated at 1.8 per cent per annum.6 The total coverage is projected to increase by the year 2020 to 255,000 and 337,000 under scenarios 1 and 3 respectively, assuming coverage is only granted to active employees and pensioners. In case coverage would also be granted to family dependents, the total coverage is projected to increase to about 547,000 (scenario 2) and 746,000 (scenario 4) respectively.

6 Common sense suggests that the number of civil servants should evolve roughly in line with population growth.

Table 3. Projected scheme coverage, 2016 – 2020, scenarios 1 – 42016 2017 2018 2019 2020

Scenario 1 238,058 242,264 246,543 250,898 255,330Scenario 2 510,440 519,457 528,633 537,972 547,475Scenario 3 314,286 319,838 325,488 331,238 337,089Scenario 4 695,626 707,915 720,420 733,146 746,097

Step 2: Estimation of benefit expenditure and total expenditure for each scenario

To estimate benefit expenditure, the total population under each scenario was divided into sex and age groups (0- 18, 19-39, 40-59, and 60+) to account for differences in utilization rates which generally vary by age and sex.7 Total benefit expenditure was projected by summing up the projected benefit expenditure for all age groups based on the generic formula:

exp ( t )=∑s , xInss , x ( t )∗(∑b ub

❑s , x❑ (t )∗ c (t)b

❑ ) (1)

Where:

Inss , x ( t ) is the number of insured of sex s (male/female) and age group x in the year t

ub❑

s , x( t)is the assumed utilization rate for benefit b for age/sex cohort (s,x) in the year t

cb❑ (t ) is the average unit cost of care for benefit b in the year t

Estimation of unit cost

Unit cost refers here to the cost per case of benefits, i.e. the amount reimbursed by the scheme which depends on the provider payment mechanism and relevant rates (see Annex A). For services in the three general service categories, which include general outpatient care (OPD), general inpatient care (IPD), and maternity-related admissions including deliveries (MAT), it is assumed that the cost will be reimbursed based on the fixed case-fees stipulated in Prakas on Provider Payment Mechanism, MOLVT, 2014 (see table A.1, Annex A). An average amount of unit cost for the three general service categories was estimated for each provider type based on the fixed case-fees (table A.1, Annex A) and assumptions on case-mix by type of hospital (see table B.3, Annex B).

Further assumptions on care-seeking behaviour or provider share among different types of providers (see table B.2, Annex B) yields an estimate for average unit cost across all types of providers, this for the three general medical services categories: OPD, IPD, and MAT. Average unit cost across all providers, weighted by the assumed service share of individual types of providers was

7 Since the scheme is planning to cover pensioners most of which are older than 60, it is considered relevant to take into account the higher utilization rate of this population group.

estimated at KHR 15,780 per general outpatient visit, KHR 247,320 per general in-patient admission, and KHR 154,240 per case for general maternity-related admissions (table 4).

Table 4. Estimated unit cost for general services, 2016

Type of service (benefit category) Unit cost (KHR)1

Outpatient care (OPD) 15,780Inpatient care (IPD) 247,320Maternity-related admissions (MAT) 154,240Note: Estimate obtained from the weighted average unit cost across all provider types, weighted according to the assumed provider share (table xyz)

For all other benefits to be reimbursed based on fee schedule including high-cost items (see table B.4, Annex B ), medical transportation ( see table B.5, Annex B), and optional benefits (see table B.6, Annex B), unit cost per case were assumed based on the cost estimates obtained from three national hospitals (Kossamak, Khmero-Soviet and Calmette) and other sources where relevant.

Estimation of utilization rates

Benefit incidence rates or utilization rates by age/sex cohort for general service categories (OPD, IPD, MAT) were assumed based on experience data from the HIP scheme in Cambodia and age-specific adjustment factors obtained from proxy data (UCS Thailand). For other benefits (high-cost items) and optional benefits, utilization rates were assumed based on proxy data from Thailand (UCS and SSS), with adjustments made where considered adequate by the authors based on their experience.

Table 5.: Assumed utilisation rates by age/sex cohort for general service categories (OPD, IPD, MAT), 2016Age group OPD1 IPD1 MAT2

0-15 2.2 0.10

16-39 1.4 0.05 0.012

40-59 2.4 0.06 0.001

60+ 4.2 0.18Notes:(1) Visits/admissions per insured person per year(2) Applies to females only; nil for male

Source: Authors’ assumptions based on HIP data and adjustments (see table b.4)

For future years, it is assumed that utilization rates will increase by 3 per cent per annum on average, except for maternity-related admissions, for which the utilization rate is assumed to decrease by two per cent per annum to account for the decreasing fertility rate in Cambodia.

The projected expenditure for the standard benefit package is shown in table 4 for all scenarios. It can be observed that under scenario 1, total benefit expenditure in 2016 is estimated at KHR 16.9

billion, projected to increase to KHR 25.5 billion by 2020. For scenario 2, total benefit cost is estimated at KHR 36.2 billion in 2016, projected to increase to KHR 54.8 billion in 2020. Under scenario 3, total benefit cost is estimated at KHR 22.0 billion in 2016, to increase to KHR 33.2 billion by 2020. For scenario 4, total benefit expenditure is estimated at KHR 48.7 billion in 2016, and is projected to increase to KHR 73.8 billion in 2020. The detailed projection results are displayed in Annex C for all scenarios.

Table 6. Projected annual benefit expenditure, Standard Benefit Package, 2016 – 2020(million KHR) 2016 2017 2018 2019 2020Scenario 1 16,870.6 18,703.1 20,742.1 22,978.8 25,518.6

Scenario 2 36,150.5 40,108.0 44,513.0 49,347.6 54,838.6

Scenario 3 21,993.0 24,375.9 27,026.8 29,934.5 33,235.9

Scenario 4 48,635.1 53,960.0 59,887.1 66,392.2 73,780.6

Optional benefitsThese are not covered under standard benefit package, and comprise annual medical check-ups for insured persons aged 40 and above, hemodialysis, and open-heart surgery.

The assumptions on incidence rates are based on entitlement (for annual check-ups) and proxy data from Thailand for hemodialysis and heart surgery. For annual check-ups it is assumed that 75 per cent of insured will make use of their entitlement each year (working assumption). Unit cost were assumed based on cost data received from national hospitals, with adjustments made as deemed appropriate (Table b.7, Annex B).

The projected expenditure for the three optional benefits suggested are shown in Annex C (table C.5-C.8).

Step 3: Projection of insurable earnings and total contribution baseAverage insurable earnings refers to the monthly reference salary used for calculating monthly contributions by applying the contribution rate. In the following, it is assumed that insurable earnings for active civil servants will comprise basic salaries only, and not include the various salary allowances paid in addition for the monthly remuneration. For pensioners, the insurable reference amount is given by monthly pension benefit received. Average monthly insurable earnings and pension benefits for the year 2015 are displayed in table 6.

Table 7.: Average monthly insurable earnings, year 2015

Category of insured Insurable earnings (KHR/month)

Active Civil Servants (CS)1 476,673

Retired CS and disability pensioners2 248,919

Ministry of Public Security (MoPS) 1 473,675

MoPS retirees and disability pensioners2 428,064Notes:(1) Average monthly basic salary(2)Average monthly pension benefit

Source: Ministry of Civil Service, Ministry of Interior, NSSF-C, and NFV

For the projection period (2016 – 2020), the average monthly insurable earnings are indexed with the nominal wage inflation rate assumed (see Table B.1, Annex B).

The total contribution base is obtained by multiplying annual insurable earnings with the projected number of contributors projected for each year. For pensioners the factor 0.5 is applied since pensioners will be charged only the employee part of the contributions (i.e. 50% of the total contribution rate).

Table 8.: Projected total contribution base, scenarios 1-4, 2016 – 2020

(KHR millions) 2016 2017 2018 2019 2020

Scenario 1 & 2 1,297,990 1,428,796 1,573,180 1,730,071 1,907,174

Scenario 3 & 4 1,750,027 1,926,387 2,121,055 2,332,585 2,571,366

Note: Total annual insurable earnings and pension benefits payable (at 50%)

It can be observed that the total contribution base is projected to increase to about KHR 1.91 trillion by the 2020 for scenario 1 and 2, and to about KHR 2.75 trillion for scenarios 3 and 4.

Step 4: Estimation of the PAYG cost rate The pay-as-you-go (PAYG) cost rate reflects the cost of benefits expressed as a percentage of insurable earnings of contributors as projected for the scheme with adjustments made as required; it is the main indicator used for setting the contribution rate of a new benefit branch. The contribution rate should be set higher than to PAYG cost rate in order to ensure a safety margin to cover an unexpected increase in expenditures and to allow for the accumulation of contingency reserves.

It is noted that the PAYGO cost rates presented below do not include administrative expenditures, since it is yet unclear whether these will be covered from contributions. The provisions regarding the financing of administration cost will ultimately depend on the choice of the implementing agency.

Table 9. Projected PAYG cost rates, Standard Benefit Package, 2016 – 2020(per cent) 2016 2017 2018 2019 2020Scenario 1 1.30 1.31 1.32 1.33 1.34Scenario 2 2.79 2.81 2.83 2.85 2.88Scenario 3 1.26 1.27 1.27 1.28 1.29

Scenario 4 2.78 2.80 2.82 2.85 2.87Notes:

(1) Projected benefit expenditure in percent of the projected contribution base; not including any provision for administration cost.

(2) Density of contributions and contribution collection rate are assumed at 100%

The projected PAYG cost rates for optional benefits are shown in Annex C (table C.5-C.8) for all scenarios. For the coverage of annual medical check-ups, the projected PAYG cost rate is shown in table 10 for all scenarios. It can be observed that under scenario 1 and 3, the PAYG cost rate for medical check-ups is estimated at about 0.4 per cent of the contribution base, whereas under scenarios 2 and 4, the PAYG cost rate for medical benefits is estimated at about 0.6 per cent of insurable wages.

Table 10. Projected PAYG cost rate, annual medical check-ups, 2016 – 2020

2016 2017 2018 2019 2020Scenario 1 0.41 0.41 0.42 0.42 0.43Scenario 2 0.58 0.59 0.59 0.60 0.61Scenario 3 0.40 0.40 0.41 0.41 0.42Scenario 4 0.58 0.59 0.59 0.60 0.60

3.2. Proposed contribution rates The proposed contribution rate required for financing the standard benefit package is presented in table 11 for all four scenarios based on the projected PAYG cost rate over the period 2016 - 2020.

Table 11. Proposed contribution rates, Standard Benefit PackageProjected

PAYG cost rate1

(2016-2020)

Contribution rate (proposed)

Benefits only Benefits and administration

Scenario 1 1.32 1.40 1.50Scenario 2 2.83 2.90 3.20Scenario 3 1.27 1.40 1.50Scenario 4 2.82 2.90 3.20Notes: (1) Administration cost are assumed at 10 per cent of benefit expenditure

The contribution rate proposed for financing the standard benefit package is proposed at 1.40 per cent for scenarios 1 and 3, and 2.90 per cent for scenarios 2 and 4 (including dependents), not including any provisions for administration cost. In case administration cost of the scheme will be

funded from contribution income, the contribution rate for the standard benefit package is proposed at 1.50 per cent for scenarios 1 and 3, and 3.20 per cent for scenarios 2 and 4.

For the three optional benefits, the projections show that heart surgeries can be covered under the proposed contribution rate. For the inclusion of medical check-ups, a higher contribution rate would be required. The contribution rate proposed for the standard benefit package plus annual medical check-ups is presented in table 12.

Table 12. Proposed contribution rates, Standard Benefit Package & medical check-ups

Projected PAYG cost rate1

(2016-2020)

Contribution rate (proposed)

Benefits only Benefits and administration1

Scenario 1 1.76 1.80 2.00Scenario 2 3.48 3.50 3.80Scenario 3 1.71 1.80 2.00Scenario 4 3.47 3.50 3.80Notes: (1) Administration cost are assumed at 10 per cent of benefit expenditure

The contribution rate should be reviewed periodically and adjustments should be made if necessary in order to ensure the financial viability of the scheme. During the initial phase of implementation (1-2 years), the cost of benefits is typically lower than the contribution income, which allows for the accumulation of contingency reserves required to absorb unforeseen expenditures and to make provisions for future cost increases. In light of the global trend of ever-increasing health care costs due to increasing utilization rates, population aging, and new medical technologies, the contribution rate may have to be raised gradually in future years.

4. Implementation issues

It is understood that no final decision have been made yet regarding implementation arrangements to be adopted for the planned scheme, and which agency will be entrusted with the management of the scheme. To avoid duplication of effort the natural choice would be to entrust the management of the new benefit branch to one of the statutory public agencies already managing social security benefits in Cambodia, which include the National Social Security Fund for Civil Servants (NSSF-C), the National Fund for Veterans (NFV), and the National Social Security Fund (NSSF) for private workers. Incidentally, the latter (NSSF) is planning to launch the social health insurance scheme for private sector workers and may be best placed in terms of operational capacity and preparedness.

The challenges ahead regarding the administrative burden related to the planned scheme should not be underestimated. While the contribution collection is not a major challenge (since all members are government employees the scheme will be funded by the Ministry of Finance as part of a salary allowance; but other functional tasks will be more burdensome to ensure efficient and effective benefit administration and a transparent and accountable management of the scheme.

The administrative body to be in charge will have to assume a broad range of functional tasks. For a public social health insurance scheme, the functional tasks typically include the following:

Public relations and communications

Contribution collection and pooling

‘Purchasing’ (which refers to the contracting of service providers for purchasing medical benefits on behalf of insured members)

Claim processing, verification, and payment of service providers

Quality assurance (i.e. monitoring) and complaint management

Accounting and financial management

Research and development

Statistics and data management

Monitoring and evaluation

Reporting to the governing board

While there is no universal rules or predefined organizational guidelines for administrative bodies of social health insurance schemes, a few general guidelines and principles should be taken into consideration based on international best practices when devising implementation arrangements:

1. Provider - purchaser split

Since a health insurance scheme is mainly a financial organization purchasing medical goods and services from medical service providers, it is generally recommended to establish a clear separation between the purchasing agency (the insurer) and service providers (hospitals) to allow for effective purchasing and avoid any possible collusion between insurance fund and contracted hospitals.

2. Separation of implementation and regulatory/supervisory functions

It is recommended that the implementation of the scheme be entrusted to an implementation agency with a clear mandate and sufficient authority to carry out its tasks in an effective, efficient, and transparent manner. Clarity over responsibilities and reporting lines are needed and the ability to recruit sufficient staff with the required technical skills (in particular for IT, finance/accounting, etc.). To ensure the required authority over management decisions and flexibility with regard to operational aspects, social health insurance scheme are often established as parastatal establishments that are granted sufficient authority over organizational decisions affecting operations, such as the authority to hire and fire contract employees with specific qualifications. Parasternal agencies are normally not bound by the limitations that characterize government agencies in terms of staff quota limits, recruitment processes, salary scales, and administrative/procedural operating rules.

3. Financial autonomy

A certain degree of financial autonomy is required for the implementation agency to ensure solvency of the scheme at all times and to make sure providers are reimbursed swiftly without delays. In the given context, it is recommended that contributions be transferred to a dedicated account (off-budget account or special treasury account) managed by the implementation agency. Relying on normal treasury accounts (budget lines) can create solvency issues in times of budgetary tightness and/or when liquidities are scarce, and generally prevents the accumulation of reserve funds. In case of an off-budget account there is a need to adopt a framework of managing prudential risk and to commission periodical audits by an independent auditor or the Government’s financial comptroller.

4. Governance body with stakeholder representation

It is generally recommended to put in place a dedicated governing board gathering the main stakeholders of the scheme, including representatives of the regulatory authority, financing agencies, and scheme beneficiaries. The role of the governing board is to oversee operations based on reporting by the chief executive of the implementation agency, and to consider and approve changes in operational provisions (e.g. benefit package) that impact on the financial situation of the health insurance fund. The governing board should have authority to modify the contribution rate of the scheme if/when required and to approve major changes in the benefit package.

5. Conclusions and Recommendations5.1. ConclusionsThe financial assessment presented in this report aims to provide financial estimates for the planned health insurance scheme for public sector employees in Cambodia. The cost of benefits has been assessed under the different coverage scenarios based on a suggested benefit package, provider network, and the provider payment mechanism to be adopted by NSSF.

According to the financial projections, the required contribution rate for financing the standard benefit package is estimated at 1.50 per cent of insurable wages for scenario 1 and 3 (employees only covered), including a provision to cover administration cost. The financial assessment further shows that a contribution rate of 3.20 per cent of insurable wages would be required to finance the standard benefit package including administration (scenario 2 and 4). It can therefore be concluded that the proposed health insurance scheme is affordable and should be pursued.

5.2. Recommendations 5.2.1. CoverageIt is recommended to provide coverage to family dependents as common for social health insurance schemes. Non-working dependents and children of employees, have no possibilities on their own to join occupational health insurance schemes, and should therefore be covered with the working family member as recommended by ILO and other internal agencies. Furthermore, granting coverage to family dependents will create strong incentives for employees to contribute, in particular for male employees with young spouse and children, and increase ownership and participation.

In light of the limited administrative capacity of the scheme during the launching phase, it may be relevant to expand the coverage gradually, e.g. granting coverage initially only to contributing employees and progressively expanding coverage to spouse and children.

5.2.2. Benefit packageIt is recommended to cover initially only the standard benefit package, and to expand benefits later by adding additional benefits based on medical need, availability of services, and financial situation of the scheme. Annual medical check-ups could be added from the start, if deemed affordable and necessary.

Regarding the provider payment mechanism, it is recommended to conduct regular reviews and negotiations with providers, and to add new case groups if necessary and agreed upon. Case fee amounts payable for general service categories (OPD, IPD, MAT) should be adjusted periodically (annually or biannually) to account for cost inflation. In this context hospital costing exercises can be useful to inform stakeholders about unit cost of care for specific types of facilities and for adjusting payment rates based on evidence regarding cost.

It is further recommended to coordinate with other health insurance schemes (e.g. NSSF) in order to ensure that provider payment rates are coherent across scheme and payments of the same level to ensure equity between the members of different schemes.

5.2.3. AdministrationThe implementation of the planned scheme is a challenging endeavour and requires the development of institutional capacity to ensure effective and efficient operations, including purchasing and benefit management, claim processing, public relations and information, and monitoring/evaluation at different levels. It is generally recommended that the implementing agency be granted a certain degree of autonomy and flexibility, and to ensure separation between implementation agency on the one hand and regulatory/supervisory authority on the other.

It is recommended to ensure sufficient separation between the administration agency and services providers to allow for effective purchasing and avoid any degree of collusion between insurer and provider. In this context, it is relevant to ensure that the implementing agency is independent from supply-side organisations (including the Ministry of Public Health) in order to be able to negotiate fees effectively and ensure value for money.

Regarding financing, it is recommended that the implementing agency be granted a certain degree of financial autonomy in order to make sure it can access liquidities when needed, and manage resources responsibly. Regular audits by an independent auditor are advised to ensure transparency and accountability regarding the use of funds.

Data collection and management is an important aspect of scheme administration. It is therefore recommended to put in place a centralized database to record, manage, and analyse data effectively and efficiently. In addition to the data on beneficiaries, the scheme should collect data on benefit utilisation, and cost of services for further analysis of scheme performance in term of cost efficiency, affordability, and financial viability. It is recommended to conduct regular actuarial valuations of the scheme, at least every 3 – 5 years to review the financial situation and assess the long-term sustainability of the scheme.

5.2.4. GovernanceIt is recommended to establish a governing board or committee gathering the main stakeholders of the scheme, including representatives of the regulatory authority, financing agencies (MoEF), scheme beneficiaries, and others as deemed relevant. The governing board should oversee operations based on reporting by the chief executive of the implementation agency, and should

have sufficient authority to consider and approve changes in operational provisions (e.g. benefit package), and to modify the contribution rate if/when required.

Annex A: Provider payment mechanism (proposed) According to the Prakas on Provider Payment Mechanism (MOLVT, 2014), a case-based payment mechanism was adopted according to which medical providers are compensated for medical service based on 12 categories of service (or cases) displayed in table A.1.

Table A.1: Case-based flat fees by type of hospital.

Case description MPA CPA1 CPA2 CPA3 NHGeneral Outpatient Services (OPD)MPA preventive services 10000Outpatient consultations 4000 8000 12000 16000 24000Minor surgical activities (OPD) 6000 16000 20000 24000 36000Emergency (MPA only) 12000 24000 36000 48000 72000Inpatient (IPD)Emergency 12000 120000 200000 280000 420000Surgery 120000 160000 240000Major surgical intervention 240000 400000 600000Adult General Medicine (IPD) 80000 100000 120000 180000Child General Medicine 72000 88000 108000 162000Tuberculosis 160000 180000 200000 300000

Delivery and maternity -related admissionsNormal Delivery 80000 88000 100000 120000 180000C-Section 240000 400000 600000Gynecology (IPD) 92000 120000 160000 240000Abortion 80000 80000 100000 150000Note: 1. No value means no provision of such a service by type of provider.2.Case-based fee is stipulated in the Prakas on Provider Payment Mechanism (MOLVT, 2014)

Apart from the above case-based payments, high-cost items are proposed in order to give rise to additional payments according to the fee schedule of the respective providers. A list of specific ‘high cost’ services has been established in the Prakas on Provider Payment Mechanism (MOLVT, 2014). A cap (maximum amount) will be set for these services. According to the Prakas, the list of high-cost items includes the following:

Hemodialysis MRI Radiotherapy Cancer cell analysis Trepanation Cardio-vascular surgery Emergency treatment for heart disease

However, some proposed high cost items have not been defined on the amount of payment will be made to service providers. Thus, the implementing agency should set up a negotiation with service providers to define the rate.

In addition, the cost of emergency medical transportation, transportation cost in case of patient referral, and, in case of a deceased patient, the cost of patient transfer from the hospital is proposed to be covered on a fee-for-service basis.

Annex B: Assumptions

Table B.1 Macro economic assumptionsIndicator 2016 2017 2018 2019 2020

Consumer Price inflation (CPI) 2.5% 3.0% 3.0% 2.9% 3.2%

Wage growth 11.8% 8.2% 8.4% 8.4% 8.7%

Note: CPI projection based on IMF; wage inflation (public sector) assumed at 5% per annum in real terms

Table B.2 Care-seeking behaviours- assumed provider share by benefit category

Service category MPA CPA1 CPA2 CPA3 NHOutpatient (OPD) 0% 25% 25% 25% 25%Inpatient (IPD) 0% 10% 20% 35% 35%Delivery and maternity -related admissions (MAT) 0% 20% 20% 30% 30%

Table B.3 Assumed case-mix, share by type of provider and benefit category Cases by category MPA CPA1 CPA2 CPA3 NH

Outpatient (OPD)MPA preventive services 40%Outpatient consultations 57% 96% 92% 88% 90%Minor surgical activities (OPD) 1% 4% 8% 12% 10%Emergency (MPA only) 2% 0% 0% 0% 0%Inpatient (IPD)Emergency 2.0% 2.0% 2.0% 2.0%Surgery 5.0% 15.0% 10.0%Major surgical intervention 10.0% 30.0% 50.0%Adult General Medicine (IPD) 97.0% 82.0% 52.0% 37.0%Child General Medicine 0.0% 0.0% 0.0% 0.0%Tuberculosis 1.0% 1.0% 1.0% 1.0%Delivery and maternity -related admissions (MAT)

Normal Delivery100.00

% 60.00% 50.00% 50.00% 50.00%C-Section 10.00% 10.00% 10.00%Gynecology (IPD) 20.00% 20.00% 20.00% 20.00%Abortion 20.00% 20.00% 20.00% 20.00%

Table B.4 High cost, incidence rates and cost per caseHigh-cost items Incidence rate Cost per case (Riel)

MRI scan 0.00029 600,000CT scan 0.01000 400,000Cancer Cell Analysis 0.00100 100,000Trepanation 0.00018 1,200,000Heart attack 0.00050 600,000Radiotherapy 0.00228 20,000Chemotherapy 0.00228 200,000Cardiovascular surgery 0.00049 1,500,000Physiotherapy (course) 0.00100 200,000Prosthetic limbs 0.00021 1,200,000Medical Implants 0.00329 1,400,000Note:1. Incidence rates were borrowed from main three health care schemes in Thailand and adjusted to fit Cambodia's context2. Cost per case were obtained from three hospitals in Cambodia, namely Soviet Hospital, Kosamak Hospital and Calmet Hospital

Table B.5 Medical transportation, incidence rates and cost per case

Transportation service Incidence rate Cost per case (Riel)

Transportation (short distance) 0.00788 80,000Transportation (long distance) 0.00088 1,600,000

Note:

1. Incidence rates were assumed based on average inpatient admissions

2. Cost per case by assuming the average distance for short and long distance (in km) and cost per km.

Table B.6 Optional benefits, incidence rates and cost per caseBenefit category Incidence rate Cost per

case (Riel)

Medical check-ups 0.75 50,000Hemodialysis 0.20 200,000Heart Surgery (excl. cardio-vascular) 0.0002 10,000,000Note:1. Incidence rates were borrowed from main three health care schemes in Thailand and adjusted to fit Cambodia's context

2. Cost per case were obtained from three hospitals in Cambodia, namely Soviet Hospital, Kosamak Hospital and Calmet Hospital

3. Medical checks up is provided to those aged above 40 only

Annex C: Projection results (detailed)

Table c.1. Projection results Scenario 1 (detailed)

Scenario 1 (Coverage to include Civil Servants & Pensioners)

Projected benefit expenditure and PAYG cost ratio, standard benefit package, 2016-2020

2016 2017 2018 2019 2020

Coverage (total) 238,058 242,264 246,543 250,898 255,330 0 - 18 - - - - - 19 - 39 95,904 97,598 99,322 101,076 102,862 40 - 59 94,578 96,248 97,949 99,679 101,440 60+ 47,577 48,417 49,273 50,143 51,029

Benefits paid (general services)OPD 561,074 588,115 616,459 646,170 677,312 IPD 17,606 18,455 19,344 20,277 21,254 MAT 5,338 5,324 5,310 5,295 5,281

Unit cost (KHR per case)OPD 15,780 16,729 17,740 18,790 19,948 IPD 247,320 262,199 278,041 294,495 312,651 MAT 154,240 163,519 173,399 183,661 194,983

Benefit expenditure (OPD/IPD/MAT) 14,031.5 15,548.2 17,235.3 19,085.4 21,186.0 OPD 8,853.8 9,838.8 10,936.1 12,141.5 13,511.3 IPD 4,354.4 4,838.9 5,378.5 5,971.4 6,645.0 MAT 823.4 870.6 920.7 972.5 1,029.7

Benefit expenditure for high-cost i tems 2,353.9 2,615.8 2,907.6 3,228.0 3,592.2 MRI scan 40.9 45.4 50.5 56.0 62.4CT scan 952.2 1058.2 1176.2 1305.8 1453.2Cancer Cell Analysis 23.8 26.5 29.4 32.6 36.3Trepanation 51.4 57.1 63.5 70.5 78.5Heart attack 71.4 79.4 88.2 97.9 109.0Radiotherapy 11.6 12.9 14.3 15.9 17.7Chemotherapy 116.1 129.1 143.5 159.3 177.2Cardiovascular surgery 166.1 184.6 205.2 227.8 253.5Physiotherapy (course) 47.6 52.9 58.8 65.3 72.7Prosthetic l imbs 60.0 66.7 74.1 82.3 91.5Medical Implants 812.7 903.1 1003.8 1114.5 1240.2Medical transportation 485.1 539.1 599.2 665.3 740.4 Short distance 150.6 167.3 186.0 206.5 229.8Long distance 334.6 371.8 413.3 458.8 510.6

Total benefits (mil. KHR) 16,870.6 18,703.1 20,742.1 22,978.8 25,518.6

Insurable earnings & benefitsTotal basic salaries 1,218,519 1,341,316 1,476,860 1,624,145 1,790,405 Pension benefits (at 50%)* 79,471 87,480 96,320 105,926 116,769

Total contribution base 1,297,990 1,428,796 1,573,180 1,730,071 1,907,174

Density factor 1 1 1 1 1Collection rate 1 1 1 1 1

PAYG cost ratio (scenario 1) 1.30% 1.31% 1.32% 1.33% 1.34%

Table c.2. Projection results Scenario 2 (detailed) Scenario 2 (Coverage to include Civil Servants & Pensioners& Dependents)


2016 2017 2018 2019 2020

Coverage (total) 510,440 519,457 528,633 537,972 547,475 Age 0 - 15 180,334 183,520 186,762 190,061 193,418 Age 16 - 39 128,280 130,546 132,852 135,199 137,587 Age 40 - 59 126,506 128,741 131,015 133,329 135,684 Age 60+ 75,321 76,651 78,005 79,383 80,785

Nr of benefits paid (general services)Outpatient visits (OPD) 1,196,287 1,253,942 1,314,376 1,377,722 1,444,121 Inpatient cases (IPD) 43,336 45,424 47,614 49,908 52,314 Maternity-related admissions (MAT) 7,741 7,720 7,699 7,678 7,658

Unit cost (KHR per case)Outpatient visits (OPD) 15,780 16,729 17,740 18,790 19,948 Inpatient cases (IPD) 247,320 262,199 278,041 294,495 312,651 Maternity-related admissions (MAT) 154,240 163,519 173,399 183,661 194,983

BENEFIT EXPENDITURE, Standard Benefit Package (in mil. KHR)

General service categories 30,789.1 34,150.2 37,890.7 41,995.3 46,656.9 Outpatient visits (OPD) 18,877.4 20,977.6 23,317.2 25,887.4 28,807.9 Inpatient cases (IPD) 10,717.8 11,910.2 13,238.5 14,697.8 16,355.9 Maternity-related admissions (MAT) 1,193.9 1,262.3 1,335.0 1,410.2 1,493.1

High-cost items 4,321.1 4,801.9 5,337.4 5,925.8 6,594.3 MRI scan 87.6 97.4 108.2 120.2 133.7CT scan 2,041.8 2268.9 2522.0 2799.9 3115.8Cancer Cell Analysis 51.0 56.7 63.0 70.0 77.9Trepanation 110.3 122.5 136.2 151.2 168.3Heart attack 153.1 170.2 189.1 210.0 233.7Radiotherapy 16.9 18.8 20.9 23.2 25.8Chemotherapy 169.3 188.2 209.2 232.2 258.4Cardiovascular surgery 250.3 278.2 309.2 343.3 382.0Physiotherapy (course) 102.1 113.4 126.1 140.0 155.8Prosthetic l imbs 128.6 142.9 158.9 176.4 196.3Medical Implants 1,210.0 1344.6 1494.6 1659.4 1846.6

Medical transportation 1,040.2 1,156.0 1,284.9 1,426.5 1,587.5 Short distance 322.8 358.7 398.8 442.7 492.7Long distance 717.4 797.2 886.1 983.8 1094.8

Total benefit expenditure (mil. KHR) 36,150.5 40,108.0 44,513.0 49,347.6 54,838.6




PAYG cost rate, Scenario 1 (Standard Benefit Pakcage) 2.79% 2.81% 2.83% 2.85% 2.88%

Table c.3. Projection results Scenario 3 (detailed)Scenario 3 (Coverage to include Civil Servants & Police & Pensioners)


2016 2017 2018 2019 2020

Coverage (total) 314,286 319,838 325,488 331,238 337,089 Age 0 - 15 - - - - - Age 16 - 39 127289 129,537 131,826 134,154 136,524 Age 40 - 59 130077 132,374 134,713 137,092 139,514 Age 60+ 56921 57,927 58,950 59,991 61,051

Nr of benefits paid (general services)Outpatient visits (OPD) 729,457 764,613 801,463 840,089 880,577 Inpatient cases (IPD) 22,707 23,802 24,949 26,151 27,411 Maternity-related admissions (MAT) 7,685 7,664 7,644 7,623 7,603



General service categories 18,312.1 20,285.4 22,480.2 24,886.7 27,618.7

Outpatient visits (OPD) 11,510.8 12,791.5 14,218.0 15,785.3 17,566.1 Inpatient cases (IPD) 5,615.9 6,240.7 6,936.8 7,701.4 8,570.2 Maternity-related admissions (MAT) 1,185.3 1,253.2 1,325.4 1,400.1 1,482.4

High-cost items 3,040.4 3,378.7 3,755.5 4,169.5 4,639.8

MRI scan 53.9 60.0 66.6 74.0 82.3CT scan 1,257.1 1397.0 1552.8 1724.0 1918.5Cancer Cell Analysis 31.4 34.9 38.8 43.1 48.0Trepanation 67.9 75.4 83.9 93.1 103.6Heart attack 94.3 104.8 116.5 129.3 143.9Radiotherapy 14.9 16.6 18.4 20.5 22.8Chemotherapy 149.2 165.8 184.3 204.6 227.7Cardiovascular surgery 207.6 230.7 256.5 284.7 316.8Physiotherapy (course) 62.9 69.9 77.6 86.2 95.9Prosthetic l imbs 79.2 88.0 97.8 108.6 120.9Medical Implants 1,021.9 1135.6 1262.3 1401.4 1559.5

Medical transportation 640.5 711.8 791.1 878.3 977.4

Short distance 198.8 220.9 245.5 272.6 303.3Long distance 441.7 490.9 545.6 605.7 674.1






Table c.4. Projection results Scenario 4 (detailed)Scenario 4 (Coverage to include Civil Servants & Police & Pensioners& Dependents)


2016 2017 2018 2019 2020

Coverage (total) 695,626 707,915 720,420 733,146 746,097 Age 0 - 15 249,948 254,363 258,856 263,429 268,082 Age 16 - 39 174,398 177,478 180,613 183,804 187,051 Age 40 - 59 178,669 181,825 185,037 188,306 191,632 Age 60+ 92,612 94,248 95,913 97,607 99,331

Nr of benefits paid (general services)Outpatient visits (OPD) 1,611,818 1,689,499 1,770,924 1,856,274 1,945,736 Inpatient cases (IPD) 58,327 61,138 64,084 67,173 70,410 Maternity-related admissions (MAT) 10,332 10,304 10,277 10,249 10,221



General service categories 41,453.4 45,979.3 51,016.3 56,543.7 62,821.0

Outpatient visits (OPD) 25,434.5 28,264.2 31,416.4 34,879.3 38,814.3 Inpatient cases (IPD) 14,425.3 16,030.2 17,818.0 19,782.0 22,013.8 Maternity-related admissions (MAT) 1,593.6 1,684.9 1,781.9 1,882.3 1,993.0

High-cost items 5,764.0 6,405.3 7,119.7 7,904.5 8,796.2

MRI scan 119.4 132.7 147.5 163.8 182.2CT scan 2,782.5 3092.1 3436.9 3815.8 4246.2Cancer Cell Analysis 69.6 77.3 85.9 95.4 106.2Trepanation 150.3 167.0 185.6 206.1 229.3Heart attack 208.7 231.9 257.8 286.2 318.5Radiotherapy 22.2 24.7 27.4 30.5 33.9Chemotherapy 222.1 246.9 274.4 304.6 339.0Cardiovascular surgery 319.9 355.5 395.1 438.6 488.1Physiotherapy (course) 139.1 154.6 171.8 190.8 212.3Prosthetic l imbs 175.3 194.8 216.5 240.4 267.5Medical Implants 1,555.0 1728.0 1920.7 2132.4 2373.0

Medical transportation 1,417.6 1,575.4 1,751.0 1,944.1 2,163.4

Short distance 440.0 488.9 543.4 603.3 671.4Long distance 977.7 1086.5 1207.6 1340.7 1492.0






Table c.5. Projection results, Optional benefits, Scenario 1

OPTIONAL BENEFITS, Scenario 1

2016 2017 2018 2019 2020Projected benefit expenditure (mil. KHR)Medical checkups 5,331 5,924 6,585 7,310 8,135 Hemodialysis 7,050 7,835 8,708 9,668 10,759 Open heart surgery 346 384 427 474 527

sub-total 12,727 14,142 15,720 17,452 19,421

PAYG cost rates (Optional Benefits)

PAYG cost ratesMedical checkups 0.41% 0.41% 0.42% 0.42% 0.43%Hemodialysis 0.54% 0.55% 0.55% 0.56% 0.56%Open heart surgery 0.03% 0.03% 0.03% 0.03% 0.03%

Sub-total (optional Benefits) 0.98% 0.99% 1.00% 1.01% 1.02%

Table c.6. Projection results, Optional benefits, Scenario 2 OPTIONAL BENEFITS, Scenario 2

2016 2017 2018 2019 2020Projected benefit expenditure (mil. KHR)Medical checkups 7,568 8,411 9,349 10,379 11,550 Hemodialysis 10,460 11,624 12,920 14,344 15,962 Open heart surgery 720 800 889 987 1,099

sub-total 18,749 20,834 23,158 25,711 28,611




Table c.7. Projection results, Optional benefits, Scenario 3

OPTIONAL BENEFITS, Scenario 3

2016 2017 2018 2019 2020Projected benefit expenditure (mil. KHR)Medical checkups 7,012 7,793 8,662 9,616 10,701 Hemodialysis 8,913 9,905 11,009 12,223 13,602 Open heart surgery 446 496 551 612 681

sub-total 16,372 18,193 20,223 22,452 24,984




Table c.8. Projection results, Optional benefits, Scenario 4OPTIONAL BENEFITS, Scenario 4

2016 2017 2018 2019 2020Projected benefit expenditure (mil. KHR)Medical checkups 10,173 11,305 12,566 13,951 15,525 Hemodialysis 13,511 15,014 16,689 18,529 20,619 Open heart surgery 965 1,072 1,192 1,323 1,472

sub-total 24,649 27,391 30,446 33,802 37,616




Annex D: International experienceSelected countries

Coverage Year of implementation

Benefit package Provider network (private/public)

Provider payment mechanism

Source of financing

Implementing agency

Thailand Civil servants, pensioners and dependents (spouses, children and parents)

1980 Curative, preventive cares, rehabilitation high-cost items. Emergency and referrals.

-Mainly public hospitals-Possible at private hospitals in case of emergency, elective surgeries and referrals

Outpatient: Fee for service and fee scheduleInpatient: Mainly Diagnosis related group (DRG) but fee for service is applied for high cost items and fee schedule is applied for cost of rooms, artificial organs, medical instruments

General tax revenue

Comptroller General Department (CGD), Ministry of Finance

Lao PDR Civil servants, pensioners and dependents (spouses and children)

1992 Curative, preventive cares, rehabilitation high-cost items. Emergency and referrals.

Only public facilities

- Capitation for outpatients and inpatients - Fee schedule for high-cost items

1.5% of total salaries (Shared equally between civil servants and government

National Social Security Fund (NSSF), under Ministry of Labour and Social Welfare, a single social insurance agency.

Selected Coverage Year of Benefit package Provider network Provider payment Source of Implementing

Selected countries




Source of financing

Implementing agency

countries implementation (private/public) mechanism financing agencyPhilippines (PhiHealth)

Civil servants, pensioners, dependents

1997 (civil servants)

Out-patient. In-patient benefits cover room and board charges; professional fees; laboratory charges; charges for use of hospital facilities and equipment, and prescription drugs. Emergency and transfer services are also included

Public and private providers

- fee-for-service- Case-based payment (DRG)

2.5 % of monthly earnings (1.25% from government and civil servants) , maximum contribution base: P35,000 a month

PhiHealth, a government owned agency, a single social health insurance agency

Indonesia(Before 2014, ASKES) (After 2014, BPJS)

Civil servants, pensioners, veterans and dependents

1968 (coverage to civil servants and families)

2014 (universal coverage)

-Primary care-Outpatient and inpatient cares-maternity and delivery cares-Pharmaceutical-Dental care- High cost cares: Hemodialysis, CT scan, Heart related surgeries

Mostly contracted publichealth centres and publichospitals

1. Capitation for primary care providers

2. Case based payment for hospitals

5% (4% from employers and 1% from employee)

National Health Insurance (NHI-BPJKN), a single social health insurance agency

Vietnam Civil servants, armed force, police, veterans dependents

1961 (civil servants)

2009 (National social

health insurance)

2012 (Universal

- ambulatory care (examination and treatment)-rehabilitation-curative servicesregular pregnancy check-ups, birth-giving- travelling expenses

Public (dominant) and contracted private providers

1. Fee or service (main), 2. Capitation (mainly use at district hospitals)

3. case-based payment (DRG)

4.5 % of earnings (government 3% and public employees 1.5 %)

Vietnam Social Security Agency (VSS), a single social health insurance agency

Selected countries




Source of financing

Implementing agency

coverage to all)

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