Engaging The Private Sector For UHC

ENGAGING THE PRIVATE SECTOR
FOR UHC
HEALTH SECTOR ROUND TABLE
Asia Think Tank Summit 2015
Asian Development Bank
Disclaimer: The views expressed in this paper/presentation are the views of the author and do
not necessarily reflect the views or policies of the Asian Development Bank (ADB), or its Board
of Governors, or the governments they represent. ADB does not guarantee the accuracy of the
data included in this paper and accepts no responsibility for any consequence of their use.
Terminology used may not necessarily be consistent with ADB official terms.
Manila
20 to 22 May 2015
Maria Elena (Maya) Baltazar Herrera, FASP, PhD

Asian Institute of Management
Asia Network for Capacity Building
in Health Systems Strengthening (ANHSS)
All Rights Reserved. Maria Elena Baltazar Herrera. 2015
UHC in Asia: Engaging the Private Sector

Diversity in Asia. Many things happening. e.g. ASEAN 2015
The private sector is significant in many Asian countries
Most Asian countries are interested in leveraging the
private sector
Asia has diverse health systems but there is emerging
interest in SHI as a mechanism for UHC
There is a wide spectrum for collaborating with the private
sector for health system goals and many methods have
been tried
There are lessons to be learned as well as continuing
challenges
Asia: Diversity of health systems
>60%
<40%
40-60%
Total Health Expenditure (THE)
Growth of number of private hospitals

Trends
Malaysia: 18%
increase in the share
of hospitals market
from 2000 to 2011
China: 17% increase
of the proportion of
number of hospitals
in private sectors
from 2005 to 2010
Japan, Singapore,
Taiwan: Stable over
11 years
Private hospitals (in % of total number of hospitals)
Private hospitals (%), 2000 - 2011
Private hospital beds (in % of total number of hospital beds)
Growth of private hospital beds

Private hospital bed (%), 2000 - 2011
Growth of private health sector

Private Health Expenditure (in % of total)
Private health expenditure (% out of total), 1995 - 2010
Complex Environment (Sample: SHI in Laos)

2012
2011
ORGANIZATIONAL
Law: Charter
And Mandate
Establish NHI
Organization
Appropriation
to support Law
Four Baskets,
One Fund
OPERATIONAL
Begin Merging
at Provincial Level
Establish LT Funding
For Indigent Cover
Evaluate Benefits,
Contributions, Payment
Establish
Technical
Functions
Long-term IT Plan
MEMBERSHIP
14%
Coverage
PROVIDERS
2015
2020
Capacity Building
Transfer Staff
& Budget
FUNDING
2013
Create a Plan
For Membership
Management
Full Merge
Nationwide
Risk
Pooling
Capacity Building on SHI Technical

And Operational Functions
Benefit Delivery
Database
Merging of
Membership
Databases
Fully
Capacitated
30%
Coverage
Fully
Sustainable
Funding
Integrate
d
NHI IT
System
50%
Universal
Coverage Coverage
Develop a Plan
Development of Quality
National QA
For
Standards,
and
AllProvider
Rights Reserved.
Maria Elena
Baltazar
Herrera. 2015
Mgt
Capacity
Building
for Function
Accreditation
Evolving role of private sector in health

systems in Asia
Capital
Investment
Provision
Entrepreneur
Intermediary
Regulator
Financing
Insurance
11
PPP Mechanisms
Contracting: Outsourcing
Contracting: Purchasing
Operating Contracts
Private Finance Initiative
Public Private Integrated Partnerships
Build Operate Transfer
Build Own Operate Transfer (BOOT)
Co-location
Public Private Partnerships in Health

Under a PPP, a government or national health insurer contracts with a private
partner (for-profit or not-for-profit) for a health care service and/or facility
Governments can select from a wide range of options depending on their needs
Wide Range of Alternatives

Design
Non&
Clinical
Construction Services
Detailed designs
Building
construction
Medical
equipment
Capital financing
IT equipment &
services
Maintenance
Food
Laundry
Cleaning
Billing
Primary
Care
Primary care
Public health
Vaccinations
Maternal &
child health
Clinical
Support
Services
Lab analysis
Diagnostic
tests
Medical
equipment
maintenance
Specialized
Hospital
Clinical
Management
Services
Dialysis
Radiotherapy
Day surgery
Other
specialist
services
Management
of entire
hospital or
network of
hospitals
and/or clinics
Potential Collaboration with Academia

Better understanding of local situation
Mapping
Capacity Building Policy Makers and Implementors

Knowledge Events, Courses, Workshops. with UHC, SHI.
Learning from Experience

Identifying key Projects and documenting lessons
Work with an international network
Focus on key needs: Pilots and Evaluations

Key areas (RH), Centrally managed broad interventions
Easy Reference Material: Evidence, Tools

Harding-Montagu Framework Applied to Private Hospital & Specialist Service Sector
Assessment
Goal
Strategy
Tools
Grow
Information /
Recognition
PHSA
Distribution
Delivery
(equity)
Mostly Private
Provision
Mixed
Mostly Govt
Provision
EQA / Accreditation
Financing
Mostly OOP
Efficiency
Mixed or
transition
Mostly Govt
or Social
Health
Insurance
Harness
Taxation, Ownership,
& Subsidy
Intermediaries
Facility &
Professional
Associations
Insurers
NGOs
Convert
Contracting
Relationship to Government
PPPs
Govt. Capacity
Quality of
Care
Committed
Leadership
Dedicated
Staff or PPP
Unit
Experience
Restrict

Source: Adapted from Harding & Preker, Private Participation in Health Services, 2003.
Regulation
MAPPING THE ENVIRONMENT FOR UHC
Environment
& Situation
Reach
Availment
Support
Demographics
Policy
Information
Policy
Indigents
Awareness
Availability
Health
Environment
Desirability
Requirements
Ease &
Availability
Affordability
Ease/
Convenience
Effective
Requirements
Efficiency
Benefit Design
Locus of Care,
Treatment
Protocol
Purchasing,
Contracting
Sample: Differential Analysis

Coverage:
Formal: High compliance
Sponsored: LGU decision
IPP: Low
Availment:
High for Formal
Low for Sponsored
Support:
Low for Formal (Low for NCR)
High for Sponsored (High for ARMM)
Cost Sharing
UHC Dimensions
Setting Sectoral Targets

Analyzing by Sector Outcomes
Which people?
Thank You!
maya@aim.edu
Maria Elena (Maya) Baltazar Herrera
Maria Elena Maya Baltazar Herrera, FASP, PhD

Assoc. Professor, Asian Institute of
Management
Core Teaching: Strategy and Policy, Finance and
Governance, Organization Development.
Research and Interests: Enterprise Risk
Management, Corporate Social Responsibility,
Entrepreneurship, Health Finance and Policy,
Governance of Family Corporations
Fellow and Former President, Actuarial

Society of the Philippines
President & Co-Founder , Solutions
Incorporated, an Abelica Global Firm
Columnist, The Manila Standard Today
Maria Elena Maya Baltazar Herrera, FASP, PhD
maya_aim@yahoo.com
Google me: Maya Baltazar Herrera
On Twitter: maya_aim
Integrations.tumblr.com
On Facebook: Integrations Manila
Experience:
CFO, Asian Institute of Management
Research Director, AIM RVR Center for CSR
VP, CFO and Actuary, The Manufacturers
Life Insurance Corp. (Phils)
President, LTS Corporation
Consulting Actuary, The Wyatt Company
Phils (now Towers Watson)
Head, Actuarial Department and Group
Insurance Administration, Lincoln Philippine
Life Insurance Corporation
EXTRA SLIDES
Hospital Financing Requirements

Lot and Infrastructure (Bricks and Mortar)
Initial Outlay
Lease/Rent
Maintenance Costs
Equipment:
Capital Expense (inc. Replacement)
Maintenance
Operating Expenses:
Fixed vs. Variable

Staff: Health and Non-Health
Non-staff Expenses
Medical Services, Hotel expenses, General Administration
Non-Public Financing
Private Financing
User Fees
Private Health Insurance (PHI)
Private Sector Purchasing Contracts
Private Sector Bonds
Donations
Development Organization Financing

Grant Facility for Private Hospitals
Development Loan Facility for Private Hospitals
Public Financing
Direct
Government Purchasing Contracts
Social Health Insurance
Other government pre-payment fund (i.e. Health Equity Fund)
Free use of government land/ Donation

Conditional Donations
Indirect
Tax Exemptions: Income Tax
Allowed Deductions: Donations to Hospitals, etc.
Tax Subsidies/Exemptions for:
Private Health Insurance (PHI) premiums
Hospital Construction/ Equipment/Others
Hospital-related Bonds/Debt Financing Instruments
Assessment
Goal
Strategy
Tools
Grow
Information /
Recognition
PHSA
Distribution
Delivery
(equity)
Mostly Private
Provision
Mixed
Mostly Govt
Provision
EQA / Accreditation
Financing
Mostly OOP
Efficiency
Mixed or
transition
Mostly Govt
or Social
Health
Insurance
Harness
& Subsidy
Intermediaries
Facility &
Professional
Associations
Insurers
NGOs
Convert
Contracting
PPPs
Govt. Capacity
Quality of
Care
Committed
Leadership
Dedicated
Staff or PPP
Unit
Experience
Restrict

Regulation
Reference Slides
CONTEXT
Diversity of Health Systems in Asia

Jurisdictions
Myanmar
Cambodia
Afghanistan
India
Pakistan
Singapore
Indonesia
Philippines
Bangladesh
Vietnam
Nepal
Sri Lanka
Lao PDR
Hong Kong SAR
China
Malaysia
Taiwan
Mongolia
Korea, Rep.
Maldives
Timor-Leste
Thailand
Papua New Guinea
Japan
Pacific island small states
Bhutan
Total health expenditure

(% of GDP)
2.0
6.0
10.4
3.7
2.8
4.5
2.8
4.1
3.7
6.8
5.1
3.5
2.6
5.2
5.0
4.4
6.6
5.5
7.1
6.2
5.7
3.9
4.1
9.2
6.1
4.3
Public health expenditure Private health expenditure

(% of THE)
(% of THE)
12.1
87.9
21.5
78.5
22.5
77.5
28.2
71.8
28.2
71.8
31.4
68.6
36.1
63.9
36.1
63.9
36.5
63.5
37.1
62.9
37.4
62.6
45.6
54.4
46.5
53.5
49.4
50.6
54.3
45.7
55.5
44.5
56.8
43.3
57.0
43.0
58.2
41.8
60.8
39.2
74.7
25.3
75.0
25.0
75.2
24.8
80.3
19.7
81.7
18.3
84.6
15.4
Source: World Bank Database, 2010
> 60%
40 - 60%
< 40%
29
Health System: A complex Adaptive System

Social, Economic, Political Physical Environment
Components and Functions of the System
Leadership and
Governance
(policy instruments)
policy
policy
policy
policy
Creating resources
Health workforce
Information
Medical products,
vaccines and
technologies
Facilities
Organizations
Financing
(collecting, pooling and
purchasing)
Population
Objectives of the System

Responsiveness
(to peoples nonmedical
expectations)
Delivering
services
(provision)
Health
Fair (financial
contribution)
refers Organization and Management

Adapted from WHO World Health Report 2000
Local, National, Supranational

30
Health Financing and UHC

Health financing within the
overall health system
Final coverage
objectives
Equity in
resource
distribution
Revenue
collection
Benefits
Pooling
UHC intermediate
objectives
Purchasing
Rest of health
system
Utilization
Need
Quality
Efficiency
Transparency
and
accountability
Universal financial
protection
Wider context/ extraAll Rights Reserved.

Maria
Elena
Baltazar Herrera. 2015
sectoral
factors
(SDH)
Provision of services
Cost sharing/user fees
(provider payment)
Allocation mechanisms
(provider payment)
Coverage
Purchasing of services
Choice?
Coverage
Pooling of funds
Choice?
Collection of funds
Contributions
Individuals
Stewardship of financing
(governance, regulation, information)
Health care
Policy Instruments (Government Tools)

Policy
Instruments
Description
Government Tools by Musgrove (1996) Application
Exhortation
Dissemination of information
through persuasion and
discussion
Research product testing

Provider information treatment protocols,
recommended drugs
Consumer information provider quality
comparisons, consumers rights, dangers of
smoking, rehydration methods, birth spacing
(Information)
Taxation
Encouraging or discouraging
behaviors through manipulation
of tax incentives / disincentives
Taxation
(Regulation and Mandates)
Expenditure
Government distribution of funds

to achieve particular aims in the
form of cash or in-kind support
(provision of space / personnel /
subsidizing activities)
Budgetary support
Subsidies
Concessions
Contracting
(Financing)
Regulation
Setting rules of behaviors backed

up by directly by the sanctions
(penalties) of the state
Licensure
Accreditation
Employee health insurance
Required immunization of school children
(Regulation and Mandates)
Public Ownership
Government directly running the

service in question
All Rights Reserved. Maria Elena
Rural public hospitals and clinics

Preventive services
Sanitation
(Direct Provision)
Baltazar
Herrera. 2015
33
Collection and pooling of funds

Expansion of social health insurance systems by
using general revenues to subsidize the poor and
(the non-poor) informal sector
Philippines, Indonesia, Vietnam
may be pooled in a single health insurance fund with

payroll contributions from the formal sector
PPP REFERENCE SLIDES
Predominant roles of private hospitals

Social health insurance (Japan, South Korea,
Taiwan) and SHI-based Mixed system
(Philippines)
Private hospitals function as part of the health
system
Private hospitals engaged in the health system
through the social health insurance
Public hospitals may be corporatized and compete
with private hospitals
Historically, private hospitals predominate
36
Predominant roles of private hospitals

Taxed based collection/Towards social health
insurance/Medisave
Influenced by markets
Driven by government policies
37
Commercialized mixed health systems (I

Unclear line or structure between public and private
Definition [Mackintosh and Koivsusalo, 2005]
the provision of health care services through market
relationships to those able to pay, including
marketisation, commoditisation, privatisation and
liberalisation
Marketisation: Shift from free provision/inputs to feefor-service provision/cash payments for inputs
Commoditisation: Specification of items of service
provision that is sold on a market
Privatisation: Shift from government owned asset to
private owned
Liberalisation: Removal of constraints on private
provision of health care services/purchases/sales
38
Commercialized mixed health systems (II)

Different patterns:
Different mixes of public and private
Different types of public and private from small
scale and unregulated providers to corporate
providers
39
Epidemiological transition
Hong Kong, Japan,
South Korea,
Singapore, Taiwan
China, India,
Indonesia, Malaysia,
Philippines, Vietnam,
Thailand
Infectious
diseases
Double
burden of
diseases
Chronic
diseases
40

Assessment
Goal
Strategy
Tools
Grow
Information /
Recognition
PHSA
Distribution
Delivery
(equity)
Mostly Private
Provision
Mixed
Mostly Govt
Provision
EQA / Accreditation
Financing
Mostly OOP
Efficiency
Mixed or
transition
Mostly Govt
or Social
Health
Insurance
Harness
& Subsidy
Intermediaries
Facility &
Professional
Associations
Insurers
NGOs
Convert
Contracting
PPPs
Govt. Capacity
Quality of
Care
Committed
Leadership
Dedicated
Staff or PPP
Unit
Experience
Restrict

Regulation

Engaging The Private Sector For UHC

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ENGAGING THE PRIVATE SECTOR

Maria Elena (Maya) Baltazar Herrera, FASP, PhD

UHC in Asia: Engaging the Private Sector

Asia: Diversity of health systems

Total Health Expenditure (THE)

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Growth of number of private hospitals

Private hospitals (in % of total number of hospitals)

Private hospitals (%), 2000 - 2011

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Private hospital beds (in % of total number of hospital beds)

Growth of private hospital beds

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Growth of private health sector

Private health expenditure (% out of total), 1995 - 2010

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Complex Environment (Sample: SHI in Laos)

Capacity Building on SHI Technical

Evolving role of private sector in health

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Public Private Partnerships in Health

Wide Range of Alternatives

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Potential Collaboration with Academia

Capacity Building Policy Makers and Implementors

Learning from Experience

Focus on key needs: Pilots and Evaluations

Easy Reference Material: Evidence, Tools

Harding-Montagu Framework Applied to Private Hospital & Specialist Service Sector

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

MAPPING THE ENVIRONMENT FOR UHC

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Sample: Differential Analysis

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Setting Sectoral Targets

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Maria Elena Maya Baltazar Herrera, FASP, PhD

Fellow and Former President, Actuarial

Maria Elena Maya Baltazar Herrera, FASP, PhD

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Hospital Financing Requirements

Fixed vs. Variable

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Development Organization Financing

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Free use of government land/ Donation

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Harding-Montagu Framework Applied to Private Hospital & Specialist Service Sector

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Diversity of Health Systems in Asia

Total health expenditure

Public health expenditure Private health expenditure

All Rights Reserved. Maria Elena Baltazar Herrera. 2015

Source: World Bank Database, 2010

Health System: A complex Adaptive System

Objectives of the System

refers Organization and Management

Local, National, Supranational

Health Financing and UHC

Wider context/ extraAll Rights Reserved.