4.Panel9 Pandu H Transition Critical Areas InaHEA July 2016
Transitioning Externally-funded Health
Programs in Indonesia : Critical Areas to
Ensure Program Sustainability
The World Bank
Third Indonesia Health Economics Association Conference
Yogyakarta, 27 – 30 July, 2016
Presentation outline
Background on the demand for programmatic
sustainability and transition planning
The roles of external funding in Indonesia’s health
sector
Critical Areas of transition planning
Country context
Financial sustainability
Programmatic sustainability
2
HEALTH FINANCING TRANSITION
OOP spending share (right axis)
Critical areas
External spending share (right axis)
LOWER
MIDDLE
INCOME
5
LOW INCOME
250
500
1000
UPPER
MIDDLE
INCOME
2500
10000
GNI per capita, US$
Source: World Development Indicators database
HIGH INCOME
35000
0
Total health spending per capita (left axis)
10
20
30
40
50
Share of total health expenditure (%)
60
Total health expenditure per capita, US
25
100
500
2500 10000
Health financing transition
100000
Defining Sustainability and Transition
4
40
60
Share of population (%)
GDP per capita, US$
2000
2500
3000
$2-a-day poverty (right axis)
IBRD
$1-a-day poverty (right axis)
Blend
• With sustained economic
growth, it is likely to transition
to upper middle-income
status within the next few
years
20
IBRD
• Indonesia re-gained its lower
middle-income status in 2003
80
100
3500
Changes in eligibility for accessing donor funds
1993
1996
LOWER
MIDDLE
INCOME
LOW
INCOME
1999
2002
2005
Year
0
1500
LOWER
MIDDLE
INCOME
2008
2011
2015
Source: World Development Indicators database
Note: GDP per capita in 2015 constant US$
GNI per capita and poverty trends in Indonesia, 1995-2013
• DAH initiatives have explicit
eligibility and graduation
clauses using recipient
country incomes status
• GFATM determines eligibility
based on a series of factors
that include country income
and disease burden
Strictly Confidential © 2014
5
Indonesia’s low dependence on EXTERNAL
FUNDING….
External funding for health for Indonesia
100
15
External source as share of THE, 2014
Share of total health expenditure (%)
5
10
Share of total health expenditure (%)
1
2
5
10
20
50
Solomon Islands
Lao PDR
Papua New Guinea
Cambodia
Ghana
Nigeria
Vietnam
Sri Lanka South Africa
Philippines
LOWER
MIDDLE
INCOME
LOW INCOME
250
500
1000
Thailand
UPPER
MIDDLE
INCOME
Brazil
Rusia
2500
10000
GNI per capita, US$
Source: World Development Indicators database
HIGH INCOME
35000
0
Indonesia
China Malaysia
India
100000
1995
2000
2005
Year
2010
2014
Source: World Development Indicators database
The share of external financing to total health spending has been
consistently low for the past decade or so.
9/23/17
6
Rising program costs and resource gaps with new
commitment to access targets and growing
demand
HIV
- HIV epidemic is projected to
continue to grow
- The GoI has committed to
expand test and treat coverage
by strengthening the continuum
of care model (Layanan
Kesehatan Berkesinambungan)
TB
- Continues to be one of the main
causes of premature deaths
- Current low coverage and multi
drug resistance are expected to
increase future costs
Strictly Confidential © 2014
7
..with the EXCEPTION for KEY PRIORITY
HEALTH PROGRAMS
•
•
The share of external funds varied across these programs but ranged
from 40-60% except for immunization program
The share of domestic financing has been increasing for the past few
years
8
What are the roles of external financing
•
•
•
Not only financial support but also provide technical
assistance;
Filling in the gap for activities Gov’t budget has less
flexibility;
Pushing agenda forward: Accountability and good
governance, Health System Strengthening, QA
However, it could cause
•
Fragmentation of planning, financing flows, reporting,
monitoring, management of services and HR;
•
Unpredictability: disbursement is irregular and future
financial flows is uncertain
•
Conflict in prioritization
•
Substitutive effect : replace instead of augment
9
Context
15 20
10
South Africa
Share of GDP (%)
5
Indonesia has started implementing
Jaminan Kesehatan Nasional, JKN, a
social health insurance (SHI) model
and plans to attain UHC by 2019 by
expanding the program coverage.
Total health expenditure
Vietnam
Cambodia
Philippines
India
Brazil
Russia
Thailand
China
Malaysia
Indonesia
Sri Lanka
Ghana
2
Indonesia is one of the lowest levels
of health expenditure globally (3.6%
of GDP); An outlier compare to LMIC
(5.6% of GDP) and for East Asia &
Pacific region (5.1% of GDP)
Lao PDR
LOWER
MIDDLE
INCOME
LOW INCOME
UPPER
MIDDLE
INCOME
HIGH INCOME
1
250
500
Title of Presentation
1000
2500
10000
GNI per capita, US$
35000
100000
10
Context
However, health is financed by a combination of sources:
OOP, central and sub-national government budgetary health
expenditures, and SHI.
Over half of national government expenditures on health
now occur at the district level, up from less than an average
of less than 10% pre-decentralization
Intergovernmental fiscal
transfers are large,
fragmented, and complex,
these transfers not to
output
11
Financial Sustainability
• Program funding needs are projected to increase due to epidemic growth
as well as, new GoI commitments to reach global targets, such as
expansion of HIV test and treat, improve case finding and notification rate,
introduction of new vaccines, etc.
• Mobilization of domestic resources, especially at sub national level,
continues to be challenging; sub national level expenditure information is
scarce
• Fiscal Space for health: the requirement for
5% and 10% budget allocation for health sector,
SDGs and other global commitment, rooms for
improving efficiency in service delivery, and JKN
• Integration with JKN : including some of program
services into the JKN basic benefit package
Integrating HIV services into JKN Basic
Benefit Package is more than just calculating
the cost…..
…..but also service delivery preparedness, ensuring,
public health functions, organizational arrangement..
13
Programmatic sustainability
• Supply side availability and readiness in general is weak and varied widely
and not necessarily link with epidemic profile; information at private sector
is limited
Health Services
HIV & AIDS
TB
Malaria
Childhood Immunization
Puskesmas
Poor
Fair
Fair
Good
Private
Clinics
*
Poor
*
Fair
Public
Hospitals
Fair
Poor
Fair
*
Private
Hospitals
*
Poor
Fair
*
• The involvement of Non-state providers is key to reach target population
groups (Key Affected Population in HIV, outreach in remote areas for
Malaria, TB),
• Pharmaceuticals and Supply Chain Management : access to global price,
and distribution costs esp. to remote areas
• Public Financial Management : planning and budgeting capacity, program
expenditure tracking
• Monitoring & Evaluation : on the one hand improved capacity for disease
surveillance, but parallel reporting requirements complicate HMIS
Transition Challenges:
Financing and Programmatic Functions
Transition challenges of ensuring NGO service delivery with public financing (i.e., HIV
services for key affected populations; expanding coverage for TB)
Strictly Confidential © 2014
15
Lessons from the Avahan Transition
Early planning and allocation of funds for transition
Continued alignments with government at each stage of
transition, including signing formal MoUs
Provision of technical and managerial support to build domestic
capacity, and institutionalization of support mechanisms
A phased approach to provide space for course correction
Provision of post-transitional support to maintain quality
Source:Confidential
CSIS, 2014© 2014
Strictly
16
Lessons from USAID family planning transition
Systematic phase-out approach required
Need to work on NGO sustainability for a long time
Need technical criteria for phasing-out financing: income not
enough
Need institutionalization of policies
Need to build capacity in public sector for a long time
Until there is high use/prevalence/diffusion of an intervention
difficult to be sustainable
Don’t necessarily need to sustain what you have today
Behavior change at population level through diffusion (use of
products, avoiding risks, or health seeking behavior) may be
Strictly Confidential © 2014
enough
Source: USAID, 2015
17
Lessons for Indonesia: Sustainability and
Transitioning of Key Health Programs
Understanding underlying health needs of the population (course
of epidemic)
Estimating resource needs (funding gap) and fiscal space for
sustaining core health programs
Integration of external funded programs into a well functioning
health system to ensure sustainability and enhance health
outcomes
Understanding institutional capacity of the country to deliver
services
Develop a clear transition strategy or plan to ensure smooth
transition from external funded programs to domestically
Strictly Confidential © 2014
financed integrated health programs
18
THANK YOU!
TERIMA KASIH
Programs in Indonesia : Critical Areas to
Ensure Program Sustainability
The World Bank
Third Indonesia Health Economics Association Conference
Yogyakarta, 27 – 30 July, 2016
Presentation outline
Background on the demand for programmatic
sustainability and transition planning
The roles of external funding in Indonesia’s health
sector
Critical Areas of transition planning
Country context
Financial sustainability
Programmatic sustainability
2
HEALTH FINANCING TRANSITION
OOP spending share (right axis)
Critical areas
External spending share (right axis)
LOWER
MIDDLE
INCOME
5
LOW INCOME
250
500
1000
UPPER
MIDDLE
INCOME
2500
10000
GNI per capita, US$
Source: World Development Indicators database
HIGH INCOME
35000
0
Total health spending per capita (left axis)
10
20
30
40
50
Share of total health expenditure (%)
60
Total health expenditure per capita, US
25
100
500
2500 10000
Health financing transition
100000
Defining Sustainability and Transition
4
40
60
Share of population (%)
GDP per capita, US$
2000
2500
3000
$2-a-day poverty (right axis)
IBRD
$1-a-day poverty (right axis)
Blend
• With sustained economic
growth, it is likely to transition
to upper middle-income
status within the next few
years
20
IBRD
• Indonesia re-gained its lower
middle-income status in 2003
80
100
3500
Changes in eligibility for accessing donor funds
1993
1996
LOWER
MIDDLE
INCOME
LOW
INCOME
1999
2002
2005
Year
0
1500
LOWER
MIDDLE
INCOME
2008
2011
2015
Source: World Development Indicators database
Note: GDP per capita in 2015 constant US$
GNI per capita and poverty trends in Indonesia, 1995-2013
• DAH initiatives have explicit
eligibility and graduation
clauses using recipient
country incomes status
• GFATM determines eligibility
based on a series of factors
that include country income
and disease burden
Strictly Confidential © 2014
5
Indonesia’s low dependence on EXTERNAL
FUNDING….
External funding for health for Indonesia
100
15
External source as share of THE, 2014
Share of total health expenditure (%)
5
10
Share of total health expenditure (%)
1
2
5
10
20
50
Solomon Islands
Lao PDR
Papua New Guinea
Cambodia
Ghana
Nigeria
Vietnam
Sri Lanka South Africa
Philippines
LOWER
MIDDLE
INCOME
LOW INCOME
250
500
1000
Thailand
UPPER
MIDDLE
INCOME
Brazil
Rusia
2500
10000
GNI per capita, US$
Source: World Development Indicators database
HIGH INCOME
35000
0
Indonesia
China Malaysia
India
100000
1995
2000
2005
Year
2010
2014
Source: World Development Indicators database
The share of external financing to total health spending has been
consistently low for the past decade or so.
9/23/17
6
Rising program costs and resource gaps with new
commitment to access targets and growing
demand
HIV
- HIV epidemic is projected to
continue to grow
- The GoI has committed to
expand test and treat coverage
by strengthening the continuum
of care model (Layanan
Kesehatan Berkesinambungan)
TB
- Continues to be one of the main
causes of premature deaths
- Current low coverage and multi
drug resistance are expected to
increase future costs
Strictly Confidential © 2014
7
..with the EXCEPTION for KEY PRIORITY
HEALTH PROGRAMS
•
•
The share of external funds varied across these programs but ranged
from 40-60% except for immunization program
The share of domestic financing has been increasing for the past few
years
8
What are the roles of external financing
•
•
•
Not only financial support but also provide technical
assistance;
Filling in the gap for activities Gov’t budget has less
flexibility;
Pushing agenda forward: Accountability and good
governance, Health System Strengthening, QA
However, it could cause
•
Fragmentation of planning, financing flows, reporting,
monitoring, management of services and HR;
•
Unpredictability: disbursement is irregular and future
financial flows is uncertain
•
Conflict in prioritization
•
Substitutive effect : replace instead of augment
9
Context
15 20
10
South Africa
Share of GDP (%)
5
Indonesia has started implementing
Jaminan Kesehatan Nasional, JKN, a
social health insurance (SHI) model
and plans to attain UHC by 2019 by
expanding the program coverage.
Total health expenditure
Vietnam
Cambodia
Philippines
India
Brazil
Russia
Thailand
China
Malaysia
Indonesia
Sri Lanka
Ghana
2
Indonesia is one of the lowest levels
of health expenditure globally (3.6%
of GDP); An outlier compare to LMIC
(5.6% of GDP) and for East Asia &
Pacific region (5.1% of GDP)
Lao PDR
LOWER
MIDDLE
INCOME
LOW INCOME
UPPER
MIDDLE
INCOME
HIGH INCOME
1
250
500
Title of Presentation
1000
2500
10000
GNI per capita, US$
35000
100000
10
Context
However, health is financed by a combination of sources:
OOP, central and sub-national government budgetary health
expenditures, and SHI.
Over half of national government expenditures on health
now occur at the district level, up from less than an average
of less than 10% pre-decentralization
Intergovernmental fiscal
transfers are large,
fragmented, and complex,
these transfers not to
output
11
Financial Sustainability
• Program funding needs are projected to increase due to epidemic growth
as well as, new GoI commitments to reach global targets, such as
expansion of HIV test and treat, improve case finding and notification rate,
introduction of new vaccines, etc.
• Mobilization of domestic resources, especially at sub national level,
continues to be challenging; sub national level expenditure information is
scarce
• Fiscal Space for health: the requirement for
5% and 10% budget allocation for health sector,
SDGs and other global commitment, rooms for
improving efficiency in service delivery, and JKN
• Integration with JKN : including some of program
services into the JKN basic benefit package
Integrating HIV services into JKN Basic
Benefit Package is more than just calculating
the cost…..
…..but also service delivery preparedness, ensuring,
public health functions, organizational arrangement..
13
Programmatic sustainability
• Supply side availability and readiness in general is weak and varied widely
and not necessarily link with epidemic profile; information at private sector
is limited
Health Services
HIV & AIDS
TB
Malaria
Childhood Immunization
Puskesmas
Poor
Fair
Fair
Good
Private
Clinics
*
Poor
*
Fair
Public
Hospitals
Fair
Poor
Fair
*
Private
Hospitals
*
Poor
Fair
*
• The involvement of Non-state providers is key to reach target population
groups (Key Affected Population in HIV, outreach in remote areas for
Malaria, TB),
• Pharmaceuticals and Supply Chain Management : access to global price,
and distribution costs esp. to remote areas
• Public Financial Management : planning and budgeting capacity, program
expenditure tracking
• Monitoring & Evaluation : on the one hand improved capacity for disease
surveillance, but parallel reporting requirements complicate HMIS
Transition Challenges:
Financing and Programmatic Functions
Transition challenges of ensuring NGO service delivery with public financing (i.e., HIV
services for key affected populations; expanding coverage for TB)
Strictly Confidential © 2014
15
Lessons from the Avahan Transition
Early planning and allocation of funds for transition
Continued alignments with government at each stage of
transition, including signing formal MoUs
Provision of technical and managerial support to build domestic
capacity, and institutionalization of support mechanisms
A phased approach to provide space for course correction
Provision of post-transitional support to maintain quality
Source:Confidential
CSIS, 2014© 2014
Strictly
16
Lessons from USAID family planning transition
Systematic phase-out approach required
Need to work on NGO sustainability for a long time
Need technical criteria for phasing-out financing: income not
enough
Need institutionalization of policies
Need to build capacity in public sector for a long time
Until there is high use/prevalence/diffusion of an intervention
difficult to be sustainable
Don’t necessarily need to sustain what you have today
Behavior change at population level through diffusion (use of
products, avoiding risks, or health seeking behavior) may be
Strictly Confidential © 2014
enough
Source: USAID, 2015
17
Lessons for Indonesia: Sustainability and
Transitioning of Key Health Programs
Understanding underlying health needs of the population (course
of epidemic)
Estimating resource needs (funding gap) and fiscal space for
sustaining core health programs
Integration of external funded programs into a well functioning
health system to ensure sustainability and enhance health
outcomes
Understanding institutional capacity of the country to deliver
services
Develop a clear transition strategy or plan to ensure smooth
transition from external funded programs to domestically
Strictly Confidential © 2014
financed integrated health programs
18
THANK YOU!
TERIMA KASIH