GHF2008 – PS10 – Innovative Healthcare Financing

Session Outline

Parallel session PS10, Tuesday, May 27 2008, 11:00-12:30, Room 3
Chair(s): George Pariyo, Senior Lecturer and Head, Department of Health Policy Planning and Management, Makerere University School of Public Health, Uganda 
Fiscal Space for Health Expenditure in Mozambique: Blocking Effectiveness of International Funds through Budget Support
Gorik Ooms, Analysis and Advocacy Unit, Médecins Sans Frontières, Belgium 
Towards Successful Community Health Insurance: Lessons Learned from Five Years of Active Involvement in Sub-Saharan Africa
Maria-Pia Waelkens, Department of Public Health, Institute of Tropical Medicine, Belgium 
Exploring SWAp’s Contribution to the Efficient Allocation and Use of Resources in the Health Sector in Zambia
Birger Forsberg, Public Health Sciences and Medical Management Centre, Karolinska Institute, Sweden
Contractual Arrangements between Community Health Insurance Schemes and Health Care Providers as a Means to Improve the Quality of Care: An Overview in Sub-Saharan Africa
Pascal Ndiaye, Department of Public Health, Institute of Tropical Medicine, Belgium 

Session Documents

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Session Report

Contributors: Sue Hua (ICVolunteers)

This session on Innovative Health Care Financing reviewed three approaches being tested in a variety of countries. The first, budget support, was found to be severely hampered by the practice of saving foreign assistance instead of spending it, due to 'fiscal space' restrictions. The second, Community Health Insurance (CHI), is based on prepayment and risk sharing. The third, the Sector Wide Approach (SWAp), suffers from a lack of harmonisation in reporting systems, resulting in unnecessary additional administration in the ministries of health.

Gorik Ooms, Analysis and Advocacy Unit, Médecins Sans Frontières, explained 'fiscal space' for health expenditure as a country's capacity to finance health expenditure from domestic resources within a foreseeable future. Whenever the combination of present domestic resources and present foreign assistance exceeds fiscal space, the excess foreign assistance is saved, rather than spent.

One fiscal space tool includes a ceiling on the government wage bill, which is most often expressed in the form of a percentage of the Gross Domestic Product (GDP). Therefore, even if donors were willing to pay for more salaries for health workers or teachers, a government is not allowed to exceed the ceiling. Other fiscal space tools include: a ceiling on the domestic primary deficit, medium - term expenditure framework (MTEF) and IMF programming of the use of foreign assistance.

During 2004 - 2006, Mozambique saved the equivalent of 91% of additional foreign assistance. Are donors aware of this? A survey was conducted with the major stakeholders of Mozambique's health sector and when they were informed that Mozambique had saved 91% of all additional aid during 2004-2006, most reacted in disbelief.

Budget support might be the best funding method, to improve harmonization among donors, alignment with government priorities and for financing recurrent general health expenditure. However, as long as donors are aware of the real impact of fiscal space constraints, and therefore do not challenge them, project support is much more effective than budget support.

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