overview of the philippine health system and the implementation framework for health reforms

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Overview of the Philippine Health System and the Implementation Framework for Health Reforms

Published by the Department of Health (DOH) Philippines San Lazaro Compound, Rizal Avenue, Sta. Cruz, Manila, Philippines 2008 This document was published through the European Commission Technical Assistance for Health Sector Policy Support Programme (EC-TA-HSPSP) in the Philippines

Technical Writers and Coordinators

Chairperson

Usec. Mario C. Villaverde, MD, MPH, MPM, CESO I Co-Chairperson

Dir. Maylene M. Beltran, MPA Members

Mar Wynn C. Bello, MD, MPA Ms. Ligaya V. Catadman, MM Ms. Antonina U. Cueto, MM Ms. Alma Lou A. dela Cruz, MM Ms. Mitos S. Gonzales, MM Ms. Glenda R. Gonzales, MPH Ms. Josephine A. Salangsang, MM

This document is accessible at: http:// www.doh.gov.ph

http://www.doh.gov.ph/

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Foreword 1 Acknowledgements 2 Overview of the Philippine Health System 3 Goals of the Philippine Health System 4

Health Status of the Filipinos 5 Life Expectancy at Birth, Crude Birth Rate and Crude Death Rate 5 Leading Causes of Morbidity 5 Leading Causes of Mortality 6 Infant, Under-Five and Maternal Mortality 6 Disaster and Emerging/Re-emerging Illness 7

Responsiveness of the Philippine Health System 8 Responsiveness of Health Facilities and Services 8 Satisfaction with Health Facilities 8

Equity in Health Care Financing 9 Challenges to the Philippine Health System 10 Implementation Framework for Health Reforms: FOURmula ONE for Health 12

Defining the Roadmap for Health Reforms 12 Starting the Race With the End in Mind: FOURmula ONE for Health Goals and Objectives 13 Building on the Gains of Previous Health Reforms: Drawing Impetus for FOURmula ONE Implementation 15 Defining the Rules of Engagement: Seven (7) General Guidelines for Health Reform Implementation 16 Carrying Out the Game Plan: Winning Strategies to Attain FOURmula ONE for Health Component-Specific Objectives 18 Health Financing 21 Health Regulation 26 Health Service Delivery 34 Health Governance 42 Running the Health Reform Race: Operational Framework for FOURmula ONE for Health 48 Pump-Priming Health Reform Implementation: F1 Financing Mechanism and Strategies 53 Reaching the Finish Line: Setting New F1 Strategies and Objectives 54

Bibliography 55

TABLE OF CONTENTS

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To improve the health status of the

population, the Department of Health (DOH) has taken a bold step of reforming how health services are delivered, regulated and financed by espousing health sector reforms which are anchored on good governance. The DOH launched the FOURmula ONE for Health (F1) in 2005 as the operational framework for health sector reforms.

Health sector reform under the F1 has the strategic framework that includes operationalization of key flagship programs on financing, service delivery, regulation, and governance in both national and local levels. It is envisioned that F1 will bring about improvement in health outcomes, make health financing more equitable, and increase public satisfaction with health care services. In essence, F1 embodies all priority programs, projects and activities that the health sector must embark to attain “Health for All Filipinos.” To implement health reforms, the DOH engages the cooperation of its various partners under the Sector Development Approach for Health in planning, organizing, coordinating, and evaluating national and international support and assistance under a common sector policy and investments program led by the DOH. Related to this, there is a need to inform all stakeholders including all Filipinos of F1 strategies as guiding principle and strategic approach in health planning, policy and program development, implementation and for monitoring and evaluation. Together, we can overcome any roadblocks that will impede our progress toward health reforms so that we can triumphantly share the fruits of a healthy, productive and progressive nation for all generations of Filipinos.

FOREWORD

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The F1 Technical Working Group led by the technical staff of the Health Policy Development and Planning Bureau (HPDPB) which directed the preparation of this document are grateful to a pool of writers, technical experts, resource persons which are enumerated below:

A. Department of Health Dir. Juanito D. Taleon, Dir. Angelina K. Sebial, Dir. Yolanda E. Oliveros, Dir. Criselda G. Abesamis, Dir. Enrique A. Tayag, Dir. Carmencita Banatin, Dir. Leticia Barbara Gutierrez, Dir. Nicolas B. Lutero III, Dir. Agnette P. Peralta, Dir. Edgardo Sabitsana, Dir. Joshua Ramos, Dr. Shirley Domingo, Mr. Ruben John Basa, Dir. Kenneth G. Ronquillo, Dr. Ma. Virginia G. Ala, Dir. Crispinita A. Valdez, Dr. Julito Sabornido, Dr. Lakshmi Legaspi, Dr. Ivanhoe Escartin, Ms. Edna Nito, Ms. Rose Aguirre, Ms. Luz Tagunicar, Mr. Adel Azuelo, Ms. Rowena Bunoan, Dr. Mario Baquilod, Dr. Aleli Sudiacal, Dr. Melecio Dy, Dr. Victoria Mandai, Dr. Agnes Segarra, Dr. Marilyn Go, Dr. Edna F. Red, Ms. Virginia Francia C. Laboy, Mr. Manuel G. Guevarra, Dr. Ma. Theresa G. Vera, Dr. Ma. Brenda C. Pancho, Engr. Bayani San Juan, Engr. Ma. Cecilia Matienzo, Dr. Robert dela Torre, Dr. Alwyn Asuncion, Dr. Jennifer Celestino, Ms. Nona Asilom, Ms. Violeta Padilla, Ms. Mary Jean Lim, Dr. Agueda Sunga, Dr. Regina Sobrepeña, Dr. Erlinda Guerrero, Ms. Erlinda Domingo, Dr. Dorie Lynn Balanoba, Ms. Menchu Equia, Ms. Jean Bernas, Dr. Lilibeth C. David, Ms. Charity Tan, Ms. Jovita Aragona, Mr. Laureano Cruz and Ms. Agnes D. Marfori.

B. Consultants and Other Partners Dr. Orville Solon, Dr. Bernardino Aldaba, Dr. Carmela Mijares-Majini, Dr. Irwin Carlo Panelo, Mr. Mario Taguiwalo, Ms. Thiel B. Manaog, Dr. Edwin Bolastig and other partners.

ACKNOWLEDGEMENTS

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According to the World Health Organization (WHO), “a health system is composed of all activities whose primary purpose is to promote, restore or maintain health”. It is composed of health care institutions, supporting human resources, financing mechanisms, information systems, organizational structures that link them together and collectively culminate in the delivery of health services to patients.” The Philippines has a dual health system consisting of a public sector and a private sector. The former is largely financed through taxes, allowing services to be given for free or following socialized user charges; while the latter is largely market-oriented and utilizes user fees to finance health services. Hence, the poor obtains health services from health facilities operated by the government while the rich opt for health services from private facilities. Since the devolution of health services under the Local Government Code of 1991, health services provided by the public sector became shared by the Department of Health (DOH) and the local government units (LGUs). The DOH, as the lead agency for health, became responsible for the development and implementation of national policies and plans, regulations, standards and guidelines on health, as well as the innovation of strategies in health to improve the effectiveness of health programs. It also acts as the administrator of national health facilities, and sub-national health facilities. Moreover, it provides services for emergent health concerns that require complicated new technologies deemed necessary for public welfare upon the direction of the President of the Philippines and in consultation with the LGUs concerned. On the other hand, the LGUs shall assume primary responsibility over the delivery of health services and the provision of health facilities devolved to them. The DOH shall in coordination with LGUs shall design and instill mechanisms providing for an integrated and comprehensive approach to health care delivery among LGUs, through the referral system and the networking of local health agencies. The DOH has adopted the sector-wide approach as the means to manage the implementation of FOURmula ONE for Health (F1) to be known as Sector Development Approach for Health (SDAH). The DOH and SDAH partners shall stimulate LGU participation to adopt F1 and national priorities in their respective localities such as advocacy on the economic and socio-political advantages of instituting health reforms, provision of incentives and forging performance-based agreements between the national and local governments among others.

OVERVIEW OF THE PHILIPPINE HEALTH SYSTEM

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The Philippine health system has three primary goals that correspond to the goals of health systems as defined by the WHO. These goals are: better health outcomes, more responsive health system and equitable health care financing.

Better Health Outcomes The health system’s main purpose is to ensure that the health status of the people are as good as possible throughout their lifecycle by the appropriate use and adequate provision of health care. There is a need to attain the best level of health status for the general population and achieve the least possible variation in health status among individuals, groups and geographic areas in the country (World Health Report, 2000; World Health Organization, 2000).

More Responsive Health System The health system needs to meet the expectations of the population it is serving. Responsiveness is a measure of the adequacy on how the health system is attending to the people’s expectation of how they should be treated by the health service providers. It is focused on the client centeredness of health care and encourages better performance towards it. This includes the patients’ and their families’ right for choice, respect, dignity, confidentiality and quality health care. Satisfaction with the health system on the other hand reflects the people’s evaluation of how their expectations were met by health care providers. The health system should provide patients and their families greater public satisfaction in the overall performance of the health system.

Equitable Health Care Financing Equitable health care financing means that financial risks are distributed in a population based on an individual’s capacity to pay rather than his or her risk of illness. The health system should ensure that an individual or family will not be forced into poverty due to the payment of health care or prohibited to avail of health care because of costs. Financial risk protection is provided by risk spreading strategy wherein revenues from people are pooled and utilized for the payment of those who get sick.

Goals of the Philippine System

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The health status of Filipinos is improving but the rate of improvement is not as good as the health status of other countries in South-East Asia.

Life Expectancy at Birth, Crude Birth Rate and Crude Death Rate are Improving

Filipinos are living longer now with an average life expectancy at birth of around 70.5 years in 2005. This may be attributed to the improving health status of the people and other socio-economic factors. Between the years 1980 to 2004, crude birth rate decreased from 30.2 to 20.5 births per 1,000 population, while crude death rate decreased from 6.2 to 4.8 deaths per 1,000 population (Philippine Health Statistics, 2004).

Leading Causes of Morbidity As in the past, most of the ten leading causes of morbidity are communicable diseases. The leading causes of morbidity from infectious causes include acute lower respiratory tract infection and pneumonia, bronchitis/bronchiolitis, acute watery diarrhea, influenza, pulmonary tuberculosis, acute febrile illness, malaria, chicken pox, measles and dengue fever from 1996 to 2006. Morbidity rates of these diseases have been observed to be declining over the last couple of years. Two of the top ten leading causes of morbidity are non-communicable diseases which are hypertension and diseases of the heart. Malaria is still the most common and persistent mosquito-borne infection in the country and drug resistant cases are on the rise.

Table 1. Ten Leading Causes of Morbidity Philippines, 1998-2007

Source: Field Health Service Information System, 1998-2007

Rank 1998 2000 2002 2004 2006 2007

1 Diarrheas Diarrheas Pneumonias Acute lower respiratory tract infection and pneumonia

Acute lower respiratory tract infection and pneumonia

Acute lower respiratory tract infection and pneumonia

2 Bronchitis/ Bronchiolitis

Bronchitis/ Bronchiolitis

Diarrheas Bronchitis/ Bronchiolitis

Acute Watery Diarrhea


3 Pneumonias

Pneumonias Bronchitis/ Bronchiolitis




4 Influenza

Influenza Influenza Influenza Hypertension Hypertension

5 Hypertension

Hypertension Hypertension Hypertension Influenza Influenza

6 TB respiratory

TB respiratory TB respiratory TB respiratory TB respiratory TB respiratory

7 Diseases of the heart

Diseases of the heart


Chicken pox Diseases of the heart


8 Malaria

Malaria Malaria Diseases of the heart

Acute Febrile Illness

Dengue Fever

9 Dengue Fever Chickenpox Chickenpox Malaria Malaria Malaria

10 Chickenpox

Measles Measles Dengue Fever Dengue Fever Chicken Pox

Figure 1. Life Expectancy at Birth by Sex and by Year

Philippines, 1995-2005

63.49

65.13 65

.43 65.73 66

.03 66.33 66

.63 66.93 67

.23 67.53 67

.83

70.08 70

.4 70.68 70

.98 71.58 71

.88 72.18 72

.48 72.78 73

.08

71.28

58

60

62

64

66

68

70

72

74

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Male FemaleCalendarYearsL

ife

in Y

ears

Source: Philippine Statistical Yearbook, 2007

Figure 1. Life Expectancy at Birth by Sex and by Year

Philippines, 1995-2005

63.49

65.13 65

.43 65.73 66

.03 66.33 66

.63 66.93 67

.23 67.53 67

.83

70.08 70

.4 70.68 70

.98 71.58 71

.88 72.18 72

.48 72.78 73

.08

71.28

58

60

62

64

66

68

70

72

74

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Male FemaleCalendarYearsL

ife

in Y

ears

Source: Philippine Statistical Yearbook, 2007

Health Status of the Filipinos

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Figure 2. Mortality Trends of Communicable Diseases, Malignant

Neoplasm and Diseases of the Heart per 100,000 Population

Philippines, 1953-2004Source: Philippine Health Statistics, 2004

0

100

200

300

400

500

600

195

4

1956

1958

196

0

1962

1964

1966

1968

1970

1972

197

4

1976

1978

198

0

1982

1984

198

6

1988

1990

1992

199

4

1996

1998

2000

2002

2004

0

10

20

30

40

50

60

70

80

90

100

Communicable

Diseases

Malignant Neoplasm

Diseases of the Heart

Years

Dea

ths

per

100

,000

po

pu

lati

on

(Co

mm

un

icab

le D

isea

ses)

Dea

ths

per

100

,000

po

pu

lati

on

( M

alig

nan

t N

eop

lasm

an

d

Dis

ease

s o

f th

e H

eart

)

Communicable Diseases

Malignant Neoplasm


Figure 2. Mortality Trends of Communicable Diseases, Malignant

Neoplasm and Diseases of the Heart per 100,000 Population

Philippines, 1953-2004Source: Philippine Health Statistics, 2004

0

100

200

300

400

500

600

195

4

1956

1958

196

0

1962

1964

1966

1968

1970

1972

197

4

1976

1978

198

0

1982

1984

198

6

1988

1990

1992

199

4

1996

1998

2000

2002

2004

0

10

20

30

40

50

60

70

80

90

100

Communicable

Diseases

Malignant Neoplasm


Years

Dea

ths

per

100

,000

po

pu

lati

on

(Co

mm

un

icab

le D

isea

ses)

Dea

ths

per

100

,000

po

pu

lati

on

( M

alig

nan

t N

eop

lasm

an

d

Dis

ease

s o

f th

e H

eart

)

Communicable Diseases

Malignant Neoplasm


Figure 3. Trends in Infant and Under-Five Mortality Rates

Philippines, 1993-2006Source: National Demographic Survey, 1993; National Demographic and Health Survey, 1998 and 2003 and

Family Planning Survey 2006

Mor

talit

y R

ate

per

1,0

00 li

ve b

irth

s 64

38

48

3540

2932

24

0

10

20

30

40

50

60

70

1993 NDS 1998 NDHS 2003 NDHS 2006 FPS

Under-Five Mortality Rate Infant Mortality RateYears

Figure 3. Trends in Infant and Under-Five Mortality Rates

Philippines, 1993-2006Source: National Demographic Survey, 1993; National Demographic and Health Survey, 1998 and 2003 and

Family Planning Survey 2006

Mor

talit

y R

ate

per

1,0

00 li

ve b

irth

s 64

38

48

3540

2932

24

0

10

20

30

40

50

60

70

1993 NDS 1998 NDHS 2003 NDHS 2006 FPS

Under-Five Mortality Rate Infant Mortality RateYears

Other infectious diseases such as rabies, filariasis, schistosomiasis, leprosy and human immunodeficiency virus/acquired immunodeficiency syndrome (HIV/AIDS) remain relevant public health problems even though they are not leading causes of illness and death. Rabies incidence in the Philippines is the 6th highest in the world. Filariasis is the second leading cause of permanent disability among infectious diseases. Schistosomiasis remains endemic in the country although it has been eliminated in most South East Asian countries. And while the leprosy has been considered as eliminated based on national prevalence levels, certain areas still have prevalence rates above the elimination target. Dengue fever is known to have sudden increases in the number of outbreaks within a year. There is no vaccine or specific drug regimen to cure it. HIV/AIDS prevalence is estimated to be low in the Philippines but, high risk behaviors appear to be increasing and could lead to high incidence over time.

Leading Causes of Mortality

Despite the positive developments in the life expectancy, Filipinos are still affected by a double burden of disease, both from communicable and non-communicable diseases. Non-communicable diseases are responsible for majority of deaths in the country. The trends of the causes of death are from disease of the heart and malignant neoplasm which comprise more than a third of the total causes of deaths. Meanwhile, deaths due to accidents doubled from 21.5 per 100,000 population in 1994 to 41.3 per 100,000 population in 2004 (Philippine Health Statistics, 2004). Deaths caused by communicable diseases have been reduced by more than half in the last twenty years. This is quite evident in the decrease of pneumonia deaths from 86.4 per 100,000 population in 1984 to 38.4 per 100,000 population in 2004, a 55.5% reduction (Philippine Health Statistics, 2004). Deaths from all forms of tuberculosis have also decreased by 40% in the last two decades. This is the result of more aggressive disease prevention and control efforts of the government and improvements in curative care.

Infant, Under-Five and Maternal Mortality The infant mortality rate (IMR) and under-five mortality rate (UFMR) per 1,000 livebirths in the Philippines have been declining through the years, but the rate of decline has slowed down during the 1990s. The IMR was estimated at 30 infant deaths per 1,000 livebirths in 1993 then decreased to 24 per 1,000 live births in 1996 (National Demographic Survey, 1993 and Family Planning Survey, 2006). The three most common causes of infant deaths are pneumonia, bacterial sepsis, and disorders related to short gestation and low birth weight. On the other hand, UFMR was estimated at 64 deaths per 1,000 livebirths in 1993 then declined to 24 per 1,000 livebirths in 2006. The most common causes of under-five mortality are pneumonia, accidents, and diarrhea (refer to Figure 3).

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7

Figure 6. Maternal Mortality Rates, Philippines

and Regions, 2006Source: Field Health Service Information System 2006, Department of Health, Philippines, 2006

1.311.18

0.61.04

0.750.69

0.930.47

0.891.19

0.960.32

0.220.62

0.380.63

0.370.63

0 0.2 0.4 0.6 0.8 1 1.2 1.4

ARMM

Caraga

XII

XI

X

IX

VIII

VII

VI

V

IV-B

IV-A

III

II

I

CAR

NCR

Philippines

Figure 6. Maternal Mortality Rates, Philippines


1.311.18

0.61.04

0.750.69

0.930.47

0.891.19

0.960.32

0.220.62

0.380.63

0.370.63

0 0.2 0.4 0.6 0.8 1 1.2 1.4

ARMM

Caraga

XII

XI

X

IX

VIII

VII

VI

V

IV-B

IV-A

III

II

I

CAR

NCR

Philippines

Figure 4. Trends in Maternal Mortality Ratio

Philippines, 1993-2006Source: National Demographic and Health Survey, 1993 and 1998 and

Family Planning Survey, 2006

209

172162

0

50

100

150

200

250

1993 NDHS 1998 NDHS 2006 FPS

Year

Mat

ern

al M

ort

alit

y R

atio

per

100

,000

live

bir

ths

Figure 4. Trends in Maternal Mortality Ratio

Philippines, 1993-2006Source: National Demographic and Health Survey, 1993 and 1998 and

Family Planning Survey, 2006

209

172162

0

50

100

150

200

250

1993 NDHS 1998 NDHS 2006 FPS

Year

Mat

ern

al M

ort

alit

y R

atio

per

100

,000

live

bir

ths

Figure 5. Infant Mortality Rates, Philippines


4.47.4

5.212.9

8.28.9

11.56.7

11.210.6

11.57.5

5.16.5

10.610.1

21.710

0 5 10 15 20 25

ARMM

Carag

XII

XI

X

IX

VIII

VII

VI

V

IV-B

IV-A

III

II

I

CAR

NCR

Philip

Figure 5. Infant Mortality Rates, Philippines


4.47.4

5.212.9

8.28.9

11.56.7

11.210.6

11.57.5

5.16.5

10.610.1

21.710

0 5 10 15 20 25

ARMM

Carag

XII

XI

X

IX

VIII

VII

VI

V

IV-B

IV-A

III

II

I

CAR

NCR

Philip

Fourteen percent of all deaths in women aged 15-49 years are maternal deaths. The country’s maternal mortality ratio (MMR) was estimated at 209 per 100,000 livebirths between 1987 and 1993 (National Demographic and Health Survey, 1993). This improved to 162 per 100,000 livebirths in 2006 (Family Planning Survey, 2006). Maternal deaths are mainly due to hypertension, postpartum hemorrhage and complications from abortions.

There is regional variation in the attainment of health outcomes such as infant and maternal mortality rates. Some regions are performing better than the national average while the others are performing poorer than the national average. Problems in administrative reporting are also aggravating the situation (refer to Figure 5 and 6).

Disasters and Emerging / Re-emerging Illness

The Philippines, being in the so-called Circum-Pacific belt of fire and typhoon, has always been subjected to constant disasters and calamities such as floods, typhoons, tornadoes, earthquakes, tsunamis, volcanic eruptions, drought, and flashfloods. Man-made disasters such as land, air and sea disasters, civil and armed conflict also take their toll in lives and properties. The country is also threatened by emerging and resurgent diseases. Emerging infectious diseases are newly identified or previously unknown infections, such as severe acute respiratory syndrome (SARS), while re-emerging infections are secondary to the reappearance of a previously eliminated infection or an unexpected increase in the number of a previously known infectious disease, such as avian influenza, mad cow disease and meningococcemia. Both types can cause serious public health problems if not contained as close as possible to its source.

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The availability of data for the overall responsiveness and satisfaction of the Philippine health system is very limited and there is a need to improve its process of collection. The level of public responsiveness and satisfaction with the health products, facilities and services are cited below:

Responsiveness of the Health System

The responsiveness of the hospital inpatient and ambulatory health care services in the Philippines is generally acceptable as shown by the result of the World Health Survey in 2000. There were less than half of the clients who rated with poor responsiveness the hospital in-patient care and ambulatory health services in the domains of being provided prompt attention, respect for dignity, autonomy, privacy and confidentiality of records and availability of basic amenities and social support. However, the choice of health care provider and availability of adequate space have been rated poorly by more than half of the respondents for hospital in-patient care (refer to Table 2). There is limited or no data on the responsiveness of primary health care facilities.

Satisfaction with the Health System

Table 2. Percentage of People Receiving Poor Responsiveness in Hospital Inpatient Care Facilities and Ambulatory Services in Selected Domains, Philippines, 2000

Source: World Health Survey, 2000

RESPONSIVENESS DOMAINS INDICATOR PERCENTAGE WHO GAVED POOR RATING

HOSPITAL IN-PATIENT CARE

HOSPITAL AMBULATORY

SERVICES

Prompt attention Waiting time 43.4 40.0

Dignity Privacy 37.1 37.6

Autonomy Treatment information

Involvement

41.3 47.4

41.3 45.5

Privacy and Confidentiality of Records Talked privately

Confidentiality of records

44.4 45.5

42.3 44.1

Choice of health care provider Choice of health care provider 52.3 46.9

Basic amenities Cleanliness

Space

42.5 50.3

38.2 44.7

Social support Family visit 43.3

Table 3. Net Satisfaction with Health Facilities with Most Used Health Facility by Area

Philippines, 2000 Source: Filipino Report Card on Pro-Poor Services, World Bank, 2000

Philippines Metro Manila Luzon Visayas Mindanao

Over-all Satisfaction +87 +87 +88 +88 +83

For –profit hospital +96 +95 +96 +100 +93

Traditional healers +94 +100 +88 +97 +93

Non-profit hospitals +91 +100 +71 +100 +100

RHU +82 +100 +90 +81 +62

Government hospital +79 +72 +85 +70 +76

BHS +74 +50 +59 +84 +75

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Responsiveness of the Philippine Health System

9

Figure 8. Family Expenditure on Health by Category

Philippines, 2000Source: Family Income and Expenditure Survey, 2000

Expenses for dental

charges,

contraceptives and

other health services

4.3%

Other medical

charges

3.5%

Medical charges

21.7%

Hospital room

charges

24.1%

Drugs and

medicines

46.4 %

Figure 8. Family Expenditure on Health by Category

Philippines, 2000Source: Family Income and Expenditure Survey, 2000

Expenses for dental

charges,

contraceptives and

other health services

4.3%

Other medical

charges

3.5%

Medical charges

21.7%

Hospital room

charges

24.1%

Drugs and

medicines

46.4 %

In 2000, the Filipino Report Card on Pro-Poor Services showed that there was a high level of overall satisfaction with health facilities. Satisfaction was significantly higher for private facilities than government facilities. For profit hospitals were rated +96, while the government hospitals were rated +79, rural health units (RHUs) were rated +82 and barangay health stations (BHS) were given a rating of +74. Although in the same survey, government hospitals got higher ratings from the rural households and those from the lower socio-economic class. In the same report, private facilities when compared to government facilities ranked superior on quality aspects, at par on convenience of location but inferior on cost aspects. In other words, cost was the only categorical advantage of government facilities over private facilities. Health services provided by public facilities were used mainly by those who could not afford the widely preferred private services.

In 2005, a total of P180.8 billion was spent on health related expenditures which is equivalent to 3.1% of the Gross National Product (GNP) in 2005. Of this, 59.1% or P106.9 billion was taken from private sources which include out-of-pocket, private insurance, health maintenance organizations, employee-based plans and private schools. Around 48.4% or P87.5 billion is primarily from out-of pocket which means that the burden of paying for health care is still predominantly shouldered by individual families instead of the government or insurance. National and local governments spent a total of P51.9 billion, or 28.7% of total health expenditures, while social health insurance paid P19.9 billion or 11%. Other sources accounted for 1.2% or P2.1 billion (Philippine National Health Accounts, 2005).

The above sources of funds reflect different insurance mechanisms with varying degrees of ability to pool resources and spread health risk. The individual family, through direct out-of-pocket expenditure, is the least effective and most inefficient health insurance institution. A family’s income and size limit the resources that can be pooled for health expenses. And since members are often exposed to similar health risks, the family has limited risk-pooling capacity. Until now, there has been limited progress made in expanding social risk pools which includes government budget and social insurance funds for health. In 1994, social risk pools financed only as much as 44% of total health spending and decreased to 42% in 2005 (Philippine National Health Accounts, 2005). On the average, families spend only 1.9% of their annual family expenditures on health care, based on a survey conducted in 2000. The average health expenditure amount of a family then was roughly P2,660 and ranged from P572 to P4,430. Of this amount, 46.4% was spent on drugs and medicines, 24.1% on hospital room charges, 21.7% on medical charges including the doctors’ fees, 3.5% on medical goods, and 4.3% on combined expenses for dental charges, contraceptives, and other health services.

Figure 7. Distribution of Health Expenditure

by Source of Funds

Philippines, 2005Source: Philippine National Health Accounts, 2005

Private Sources

59.1%

Others

1.2%

Local

Government

12.87%

National

Government

15.84%

Social Health

Insurance

11.0%

Figure 7. Distribution of Health Expenditure

by Source of Funds

Philippines, 2005Source: Philippine National Health Accounts, 2005

Private Sources

59.1%

Others

1.2%

Local

Government

12.87%

National

Government

15.84%

Social Health

Insurance

11.0%

Equity in Health Care Financing

10

Given the scenarios presented in the previous sections, it is evident that the Philippine health system is confronted with challenges in achieving its three goals: improving the health status of the population, developing a health system that is more responsive to the health needs of the people and ensuring equity in financing health care.

Table 4. Comparative Trade Prices of Branded Medicines (in Peso) Philippines, India and Pakistan 2004

Source: MIMS 2004, Philippines; IDR 2004, India & Red Book 2004, Pakistan

Medicine Generic Name Medicine Preparation

Medicine Brand Name

Manufacturer Philippines India Pakistan

Mefenamic Acid tab 300 mg tablet Ponstan Pfizer 20.98 2.80 1.46

Hyoscine-N-butylbromide 10 mg tablet Buscopan Boehringer 9.26 2.45 0.60

Cotrimoxazole 400/80 mg tablet Bactrim Roche 14.80 0.75 1.09

Nifedipine 20 mg tablet Adalat Retard Bayer 37.56 1.50 3.85

Gemfibrosil 300 mg capsule Lopid Pfizer 34.66 13.17 2.89

Furosemide 40 mg tablet Lasix Aventis 8.56 0.53 1.28

Enalapril maleate 5 mg tablet Plendil ER AstraZeneca 35.94 5.95 8.25

Gliclazide 80 mg tablet Diamicron Servier 11.00 7.57 5.00

Salbutamol 50 mg Ventolin Glaxo 315.00 132.38 65.88

Diclofenac 50 mg tab Voltaren Novartis 17.98 0.92 3.92

Isosorbide dinitrate 5 mg SL tab Isordil Wyeth 10.29 0.26 0.23

Loperamide 2 mg cap Imodium Janssen 10.70 3.27 1.94

Ceftazidime pentahydrate 1g vial inj. Fortum Glaxo 980.00 418.72 322.75

There are also problems in the accessibility and quality of health products, facilities and services. The access to cheaper but quality drugs and medicine is poor. In 2003, the Philippine pharmaceutical market was estimated to be P65 to 70 billion and accounted for roughly 45% of health spending. Despite the large pharmaceutical market, local drug prices are 2 to 30 times higher than in Canada or neighboring Asian countries. This situation exists partly because low cost quality generic medicines comprise only 15 to 20 percent of the market while the rest are dominated by high-priced branded medicines (See Table 4). Furthermore, drug distribution is controlled by a few big distributors, mostly private drugstores; 85% of all drugs sold in the country are dispensed from these private pharmacies.

The access to health facilities and health professional is also poor. In 2003, around 60% of all births were attended by a trained health professional in a health facility but the rest were delivered by hilots or unlicensed midwives and other untrained attendants (NDHS 2003). In the same year, around 34 out of 100 deaths from all causes and around 65% of deaths from certain conditions originating in the perinatal period were attended by a medical or health professional (PHS 2003).

Government primary health facilities are conveniently located as 94% of households are within 15-minute walking distance to a Rural Health Unit (RHU) or Barangay Health Station (BHS). However, these facilities were frequently bypassed resulting in overcrowding of higher level facilities that are supposed to be reserved for more specialized care. On health facility utilization, the Filipino Report Card on Pro-Poor Services in 2000 showed that 77% of households surveyed used health facilities of one type or another (See Table 5). Urban households tend to use health facility services more compared to rural households. Government facilities were more frequented than private facilities due to the cheaper cost of health services being offered. Those who used the private facilities were predominantly rich households and urban respondents, although poor respondents reported using private facilities as well.

Challenges of the Philippine Health System

11

Table 5. Utilization of Health Facilities by Area Philippines 2000

Source: Filipino Report Card on Pro-Poor Services, World Bank, 2000

Philippines

(%) M. Manila

(%) Luzon

(%) Visayas

(%) Mindanao

(%)

Visited health facility 77 82 68 84 82

Mainly used government facility 39 35 36 44 42

Government hospital 20 20 24 16 16

BHS 10 6 4 21 14

RHU 9 9 8 7 12

No private facility (4) (2) (3) (5) (9)

Mainly Used facility 30 46 28 27 24

For profit 28 44 27 25 22

Non-profit 2 2 1 2 2

No govt. facility (2) (2) (4) (0.2) (3)

Traditional healers 8 2 3 12 17

These challenges have been in the forefront of major reform initiatives in the health sector and remain as the focus of the implementation framework for health reforms that will be discussed in the next section.

12

IMPLEMENTATION FRAMEWORK FOR HEALTH REFORMS: FOURMULA ONE

FOR HEALTH

Defining the Roadmap for Health Reforms

To respond to the major challenges in the health sector there is a need for more aggressive health reforms to be implemented across all levels of the health sector. Thus, an implementation framework for health sector reforms was developed - the FOURmula ONE for Health (F1). This approach is designed to implement critical and concrete health interventions as a single package, and incorporates effective management infrastructure and financing arrangements. It shall be implemented throughout the medium term, from 2005 to 2010. F1 is both a philosophy and an approach. As a philosophy, it aims to improve health sector performance by enhancing the way health goods and services are financed, regulated and delivered, anchored on good governance. As an approach, it employs critical policy instruments to implement programs, projects and activities directed at priority health outcomes which are determined based on need and strategic contribution to overall reform effort. F1 engages the entire health sector to include the public and private agencies, national agencies and local government units, external development agencies, and civil society in the implementation of health reforms. Everyone is invited to join the collective race against fragmentation of the health system of the country, against the inequity of healthcare and the impoverishing effects of ill-health. With a robust and united health sector, the race towards better health and a brighter future can be won.

13

Starting the Race with the End Goal in Mind: FOURmula ONE for Health Goals and

Objectives

Over-all Goals The implementation of FOURmula ONE for Health (F1) is directed towards achieving the end goals of the Philippine Health System --- better health outcomes, a more responsive health system, and more equitable healthcare financing. These goals are in consonance with the Millennium Development Goals (MDGs) and Medium Term Philippine Development Plan (MTPDP), and are articulated in more detail in the National Objectives for Health 2005 -2010.

General Objective FOURmula ONE for Health (F1) is aimed at achieving critical reforms with speed, precision and effective coordination directed at improving the quality, effectiveness, equity, and efficiency of the Philippine health system in a manner that is felt and appreciated by all Filipinos.

FOURmula ONE for Health (F1) will strive within the medium term to:

Secure higher, better and sustained financing for health;

Assure the quality and affordability of health goods and services;

Ensure access to and availability of essential and basic health packages; and

Improve performance of the Philippine health system

General objective

To undertake critical reforms with speed,

precision, and effective coordination

towards improving the quality, efficiency,

effectiveness and equity of health care

delivery

MTPDP MDGsNOH

FOURmula ONE for Health objectives

and the health system goals

Reform Mechanisms

Objectives

1. Financing (higher, better

and sustained)

2. Regulation (assured

quality and affordability)

3. Service Delivery

(ensured access and

availability)

4. Governance (improved

health system

performance)

Health Systems Goals

• Better health

outcomes

• More responsive

health system

• Equitable health

care financing

14

TThhee FF11 OObbjjeeccttiivveess aanndd SSttrraatteeggiieess

Health Financing

Objective: Secure higher, better and sustained financing for health

Strategies 1. Mobilizing resources from extra-budgetary sources 2. Coordinating local and national health spending 3. Focusing direct subsidies to priority programs 4. Adopting a performance-based financing system 5. Expanding the national health insurance program

Health Regulation

Objective: Assure the quality and affordability of health goods and services Strategies

1. Harmonizing licensing, accreditation and certification 2. Developing a “seal of approval” for quality assurance 3. Pursuing revenue enhancement with income retention for health

regulatory agencies 4. Ensuring access of the poor to essential health products, specifically

drugs and medicines

Health Service Delivery Objective: Ensure access and availability of essential and basic health

packages Strategies

1. Making available basic and essential health service packages by designated providers in strategic locations

2. Assuring the quality of both basic and specialized health services 3. Intensifying current efforts to reduce public health threats

Good Governance

Objective: Improve performance of the health system

Strategies 1. Improving governance in local health systems 2. Improving national capacities to manage and steward the health

sector 3. Pursuing the development of rationalized and more efficient national

and local health systems

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Building Gains of Previous Health Reforms: Drawing Impetus for FOURmula ONE for

Health Implementation

The current implementation of health reforms builds upon the lessons and experiences from the major health reform initiatives undertaken in the last 30 years -- from the Primary Health Care approach in the late 1970s, the Generics Act in the late 1980s, the devolution of public health system in the early 1990s, the National Health Insurance Act of 1995, to the Health Sector Reform Agenda (HSRA) conceptualized in the late 1990s.

Since the inception of the HSRA in 1999, health reforms have made inroads in at least 30 provinces. In health governance, municipalities have joined together to form Inter-Local Health Zones (ILHZs) to optimize sharing of resources and maximize joint benefits from local health initiatives. A total of 151 out of 183 organized ILHZ (82%) became functional in 2005. Under health regulation, the parallel drug importation of drugs and medicines lowered the cost of ten therapeutic classes of their local counterpart by at least 50% from their 2000 prices. Access for cheaper but quality drugs were promoted through the establishment of Botika ng Bayan and Botika ng Barangay as well as the promotion of generic pharmaceutical products. In health service delivery, key LGU facilities have been upgraded to meet accreditation requirements and be entitled for capitation or reimbursements from PhilHealth. All DOH hospitals underwent income retention and utilized their income to improve health care services. Four specialty hospitals were rationalized into corporate hospitals wherein they started to be managed by autonomous governing boards. Such hospitals include the Philippine Heart Center, Lung Center of the Philippines, National Kidney and Transplant Institute and the Philippine Children’s Medical Center. For health financing, LGUs have increased contributions needed to enroll indigents into the social health insurance program. Not only is the coverage of health services being improved in these localities, invaluable lessons are also being learned to bolster confidence in the implementation of these reforms nationwide.

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Defining the Rules of Engagement: Seven (7) General Guidelines for Health Reform

Implementation

F1 Rule No.1

FOURmula ONE for Health (F1) will organize the critical reform initiatives into four implementation components, namely: Health Financing, Health Service Delivery, Health Regulation and Good Governance.

F1 Rule No. 2:

The implementation of FOURmula ONE for Health (F1) will focus on a few manageable and critical interventions. Such interventions will be identified using the following criteria:

Doable given available resources - Critical interventions identified for each component must be deemed doable given the available time, human and financial resources.

Sufficient groundwork and buy-in - The chosen interventions must be backed by sufficient groundwork and buy-in from implementation partners, especially in the development of reform packages for local implementation.

Triggers a reform chain reaction - These critical interventions must be able to trigger a chain of reaction that will spur the implementation of other FOURmula ONE for Health (F1) interventions, within and across the four components.

Produces tangible results and generates public support - These critical interventions must be able to show tangible results within the immediate and medium terms, which in turn generate support and cooperation from the public.

F1 Rule No. 3

The reforms will be implemented under a sector-wide approach, which encompasses a management perspective that covers the entire health sector and an investment portfolio that encompasses all sources.

F1 Rule No. 4

The National Health Insurance Program (NHIP) will serve as the main lever to effect desired changes and outcomes in each of the four implementation components, where the main functions of the NHIP including enrollment, accreditation, benefit delivery, provider payment and investment are employed to leverage the attainment of the targets for each of the reform components.

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F1 Rule No. 5

The functional and financial management arrangements will be defined in terms of specific offices having clear mandates, performance targets and support systems, within well-defined time frames in the implementation of reforms within each component.

F1 Rule No. 6

The functional clustering of teams and assignment of specific Team Leaders shall facilitate implementation, monitoring and supervision in a coordinative manner and shall not, in any way, prejudice the corporate nature of the DOH-attached agencies or the autonomy of Local Government Units.

F1 Rule No. 7

The selection of FOUR-in-ONE Convergence Sites will be governed by the following criteria:

▫ Willingness of the LGU to participate in the F1 implementation, in terms of commitment to shoulder the requisite counterpart resources, and willingness to enter into formal national government to local government, inter-local government and government to private sector networking, partnership and resource sharing arrangements

▫ Presence of local initiatives or start-up activities relevant to F1 strategies, to include, but not limited to: development of inter-local health zones, enrollment of indigents into the social health insurance system, improvement in drug management systems, among others

▫ Relatively high feasibility of success and sustainability, to include factors such as capacity to enter into loans, capacity to absorb investments and sustain the reform process

▫ Availability of funds from Government of the Philippines (GOP) and external sources for capital investment requirements.

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Carrying Out the Game Plan: Winning Strategies to Attain FOURmula ONE for

Health Component Specific Objectives

Critical interventions under F1 are packaged under the four reform components: Health Service Delivery, Health Regulation, Health Financing, and Good Governance. It is envisioned that all the reform components shall be implemented as a single package in areas which shall be called as the FOUR-in-One sites. Greater investments, more technical assistance and more intensive implementation processes and arrangements shall be focused in the FOUR-in-One sites. As such, 16 provincial LGUs were selected as initial implementation sites for F1 and additional provinces if not all provinces in the country shall be selected as roll-out sites. The provinces that are not selected as F1 sites are encouraged to implement the different F1 programs, projects and activities (PPAs) within their means even without the support from other partners. However, it is recognized that the implementation of many F1 PPAs shall be done at national scale such as the different priority public health programs and projects for maternal and child health, tuberculosis, HIV/AIDS and enrollment of indigent families to the Sponsored Program of PhilHealth among others. To better operationalize each reform component, flagship PPAs has been defined. The said PPAs shall be implemented at the national and local levels. The PPAs at the national level shall focus on health policy formulation and program development; capability building for LGUs and other stakeholders; leveraging services for priority public health programs; regulation of services, products and facilities, health promotion and advocacy; improvement of management systems and processes; tertiary care development; and monitoring and evaluation among others.

The PPAs at the LGU level focus on the adoption and implementation of health policies and programs. The LGUs shall also strive for the improvement of their management systems and processes. The preceding section shall focus on the details of the PPAs for the national and LGU levels.

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F1 Programs, Projects and Activities

National Level LGU Level I. Health Financing I. Health Financing

1. Expansion of the National Health Insurance Program (NHIP)

a. Attainment of Universal Coverage for Social Health Insurance b. Assurance of National Government Premium Counterpart c. Development and Implementation of Tool/s to Identify the Indigent Families for

PhilHealth Sponsored Program Enrolment d. Accreditation of Health Care Providers e. Expansion of PhilHealth Benefit Packages

1. Support to the Expansion of National Health Insurance Program (NHIP)

a. Support to the Attainment of Universal Coverage for Social Health Insurance

b. Assurance of Local Government Premium Counterpart c. Adoption of PhilHealth Approved Tool for Identifying Indigent Families and Ensure their Enrolment to PhilHealth d. Compliance to PhilHealth Accreditation Standards e. Rational Use of PhilHealth Capitation and Reimbursements

2. Budget Reforms in DOH and Attached Agencies

a. Development of the Health Sector Expenditure Framework (HSEF) b. Establishment of a System for Budget Allocation, Utilization and Performance

Monitoring c. Mobilization of Extra-Budgetary Resources d. Coordination of National and Local Health Spending

2. Increasing LGU Investment for Health

a. Increasing Budget Allocation for Health b. Revenue Generation and Mobilization of Extra-Budgetary

Resources c. Income Retention of Health Facilities

3. Establishment of Local Health Accounts

II. Health Regulation II. Health Regulation 1. Upgrading, Harmonization and Streamlining of the Regulatory Systems and

Processes a. Establishment of a One-Stop Shop for Licensure of Health Facilities b. Automation of Regulatory Systems and Processes c. Decentralization of Appropriate Regulatory Functions to Regional Offices and

LGUs d. Upgrading of the Critical Capacity of Regulatory Agencies e. Strengthening of Enforcement Mechanism and Regulatory Oversight Functions

of DOH

1. Enforcement of National Health Legislation, Policies and

Standards

2. Development of Quality Seals for Health Products, Food, Devices, Drug

Establishments, Facilities and Services

2. Legislation and Localization of Health Regulatory Policies

3. Harmonization of Systems and Processes of DOH Regulatory Offices with ASEAN Standards

4. Improving the Availability and Access to Low-Cost and Quality Essential

Medicines and Other Health Commodities a. Promotion of High Quality Generic Pharmaceutical Products b. Expansion of Pharmaceutical Distribution Networks c. Identification of Alternative Local and Foreign Sources of Low-Priced Quality

Drugs and Medicines d. Development of Mechanisms for Pooled Procurement Among Health Facilities

Across LGUs

3. Improving the Availability and Access to Low-Cost Quality

Essential Medicines and Other Health Commodities a. Promotion of High Quality Generic Pharmaceutical Products b. Establishment and Operation of Pharmaceutical Distribution

Networks c. Implementation of Pooled Procurement among Health Facilities

across LGUs

5. Institutionalization of Cost Recovery and Revenue Enhancement

Mechanisms for Health Regulatory Agencies a. Income Retention Policy b. Fee Restructuring

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F1 Projects Programs and Activities

National Level LGU Level III. Service Delivery III. Service Delivery

1. Public Health Development Program 1. Public Health Development Program

a. Establishment of Disease-Free Zones Filariasis Elimination Services Schistosomiasis Elimination Services Rabies Elimination Services Leprosy Elimination Services Malaria Control Services

a. Establishment of Disease-Free Zones Filariasis Elimination Services Schistosomiasis Elimination Services Rabies Elimination Services Leprosy Elimination Services Malaria Control Services

b. Intensifying Disease Prevention and Control Tuberculosis Control Services HIV/AIDS Control Services Dengue Control Services Emerging and Reemerging Infection Prevention and Control Services

b. Intensifying Disease Prevention and Control Tuberculosis Control Services HIV/AIDS Control Services Dengue Control Services Emerging and Reemerging Infection Prevention and Control

Services

c. Improving Reproductive Health Outcomes i. Enhancement of the Child Health Programs

Expanded Program on Immunization Breastfeeding Program Integrated Management of Childhood Illnesses (IMCI) Nutrition Services

ii. Enhancement of the Maternal Health Programs Safe Motherhood Policy Reproductive Health to Include Family Planning and Adolescent

Health Maternal Nutrition

c. Improving Reproductive Health Outcomes i. Implementation of Child Health Programs

Expanded Program on Immunization Breastfeeding Program Integrated Management of Childhood Illnesses (IMCI) Nutrition Services

ii. Implementation of Maternal Health Programs Safe Motherhood Policy Reproductive Health to Include Family Planning and Adolescent

Health Maternal Nutrition

d. Intensifying Healthy Lifestyle and Management of Health Risks

Advocacy Campaigns for Risk Behaviors Water and Sanitation Programs Risk Factor Screening

d. Intensify Healthy Lifestyle and Management of Health Risks Advocacy campaigns for risk behaviors Water and Sanitation Programs Risk factor screening

e. Strengthening the Surveillance and Epidemic Management System

Creation and Strengthening of Epidemic and Surveillance Units Creation of Regional Epidemic Management Committee (REMC) Set up Surveillance Systems Linkage with Private Sector


Creation and Strengthening of Epidemic and Surveillance Units Creation of Provincial Epidemic Management Committee (PEMC) Set up Surveillance Systems Linkage with Private Sector

f. Strengthening the Disaster Preparedness and Response System f. Strengthening the Disaster Preparedness and Response System

g. Intensifying Health Promotion and Advocacy Review of Health Promotion Interventions and Technology Upgrade Strengthening Health Promotion in Service Packages Integration of Patient Education in Clinical Practice Guidelines Creation of Health Promotion Foundation

g. Intensifying Health Promotion and Advocacy Localization of Health Promotion and Advocacy Materials Behavior Change Communication (BCC) Intensification of Patient Education in Clinical Practice

2. Health Facilities Development Program a. Rationalization of Health Facilities and Services Including the Provision

and Capacity Building of Human Resources for Health b. Integration of Wellness Services in Hospitals c. Hospital Development Planning

2. Health Facilities Development Program a. Rationalization of Local Health Facilities to Include BEmOC/ CEmOC

and the Provision and Capacity Building of Human Resource for Health

b. Integration of Wellness Services in Hospitals c. Compliance to PhilHealth Accreditation Standards for Health Facilities d. Compliance to DOH Licensing Standards for Health Facilities

IV. Good Governance IV. Good Governance 1. National and LGU Sectoral Management

a. Strengthening the Stewardship of National and Local Health Systems b. Strengthening the National Human Resources for Health Program c. Sector Development Approach for Health (SDAH) Implementation d. Institutionalization of the Monitoring and Evaluation of Health Reforms e. Strengthening the Philippine Health Information System

1. LGU Sectoral Management a. Strengthening the Local Health Systems Development b. Strengthening the Local Human Resource Management System c. Sector Development Approach for Health (SDAH) Implementation d. Support to the LGU Scorecard Implementation e. Strengthen Local Health Information System Development and Utilization

2. DOH Internal Management a. Strengthening the Public Finance Management b. Strengthening the Procurement and Logistics Management c. Asset Management d. Strengthening the Internal Audit

2. LGU Internal Management a. Strengthening the Public Finance Management b. Strengthening the Procurement and Logistics Management c. Asset Management d. Strengthening the Internal Audit

21

I. STRATEGIES The objective of health financing reforms is to secure higher, better and sustained investments in health to provide equity and improve health outcomes, especially for the poor. The key strategies for attaining this objective are as follows:

1. Mobilizing resources from extra budgetary sources

Additional resources for health shall be mobilized by increasing the revenue generation capacities of health agencies and facilities through user fees from personal health care; regulatory services; and rationalized use of government properties and assets without compromising access by the poor. Resources from official development assistance and the private sector can also be tapped. Health agencies and facilities with significant revenue generating capacities shall not only support its own requirements but also contribute to meet the needs of non-revenue generating priority programs. However, such mechanisms need to be designed in a way that do not penalize or restrain fiscal performance of revenue generating agencies.

2. Coordinating local and national health spending The overall management of total health investments shall be undertaken using a sector wide approach, where health resources are pooled and allocated rationally across all levels, based on priority areas. The implementation of health reform interventions shall be financed jointly by national and local governments, PhilHealth and development partners. Mechanisms to mobilize private sector resources shall be developed. The DOH shall take the lead in coordinating national and local health spending and ensure that there is no duplication in health expenditure by different sources of financing.

3. Focusing direct subsidies to priority programs Efforts to mobilize more investments for health shall be coupled with measures to improve efficiency in the system on two accounts: (1) maximizing the expected performance outputs using the available resources; and (2) properly allocating the resources where they shall yield the optimum health impact. Existing resources for health shall be focused on identified priority areas and programs. Specifically, direct subsidies from national and local governments shall be focused on basic and essential health goods and services commonly used by the poor.

4. Adopting a performance based financing system Financing of health agencies and programs shall be shifted from historical or incremental budgeting system into one that is performance based. The budget allocations and releases shall therefore be conditioned on the achievement of performance targets. A multi-year budget scheme shall be developed to support selected priority programs that require long term financing.

5. Expanding the national health insurance program The national health insurance program shall be further strengthened by expanding enrollment coverage, improving benefits and leveraging payments on quality of care. PhilHealth shall strengthen coordination and continue engaging partners at the local level.

Health Financing

22

II. PROGRAMS, PROJECTS AND ACTIVITIES

A. National Level

1. Expansion of the National Health Insurance Program

a. Attainment of Universal Coverage for Social Health Insurance

The Philippine Health Insurance Corporation or PhilHealth shall continuously conduct advocacy to increase membership and collection for the National Health Insurance Program (NHIP) to achieve its goal of universal social health insurance coverage. This shall include social marketing mechanisms to increase and sustain coverage as well as ensuring timely and accurate premium remittance for the following: a) indigent families under the Sponsored Program; b) Overseas Filipino Workers (OFWs); c) voluntary and self-employed individuals under the Individually Paying Program (IPP); and d) government and private employees under the formal sector. In order to establish a truly equitable social health insurance program, PhilHealth shall develop a more responsive contribution structure such that those who have more resources bear the bigger burden compared to that of the poor.

b. Assurance of National Government Premium Counterpart

DOH and PhilHealth shall develop mechanisms to ensure financing for the national government counterpart of the PhilHealth premium for the enrollment of indigent families in the Sponsored Program through the General Appropriations Act and other funding mechanisms initiatives.

c. Development and Implementation of Tools to Identify the Indigent Families for PhilHealth Sponsored Program Enrolment

PhilHealth shall adopt the Proxy Means Test (PMT) protocol of Department of Social Welfare and Development (DSWD) which predicts income per capita at household level. The variable to be estimated is income instead of consumption because the Philippine official statistics are income-based. In order to ensure consistency among national poverty programs, the DSWD declared that the PMT methodology will eventually be the national tool to identify indigents.

d. PhilHealth Accreditation of Facilities

PhilHealth shall continue to accredit public and private hospitals and other health care facilities such as ambulatory surgical clinic, free-standing dialysis clinics, maternal care package, and TB-DOTS providers to increase access of members to NHIP.

e. Expansion of PhilHealth Benefit Packages

The PhilHealth benefit packages shall continuously evolved to respond to the needs of the greater number of members in support to the National Objectives for Health and within the context of F1 of the DOH. Among the new benefits to be rolled out before the year 2008 ends are the following:

a) payment for the 4th normal spontaneous deliveries; b) outpatient benefits for the treatment of malaria and HIV / AIDS (the reduction of the

incidence rates of these diseases is part of the MDGs), of which the Philippines is a signatory; and

c) malaria package of P600 which will include payment for laboratories, diagnostics, and some of the drugs and administrative costs, and will be made available through RHUs.

Steps shall also be taken to ensure that benefits remain within the range of targeted support value. Clinical Practice Guidelines (CPGs) or treatment protocols for the proper management of patients shall also be developed to ensure rational use of drugs, medicines and services and to prevent excessive claims of health providers from the purchasers of health services such as

PhilHealth and the general population.

23

2. Budget Reforms in DOH and Attached Agencies

a. Development of the Health Sector Expenditure Framework A medium term Health Sector Expenditure Framework (HSEF) will be developed to facilitate linking budget allocation to performance. This will be the basis for planning, budgeting, utilizing funds and monitoring other project components, harmonized with DOH’s own management processes.

b. Establishment of a System for Budget Allocation, Utilization and Performance Monitoring Financing of health agencies and programs shall be shifted from historical and incremental

budgeting system into one that is performance-based. Budget allocation and releases shall

therefore be conditioned on the achievement of performance targets. Performance-based

budgeting initiatives shall include the following:

i. Performance-based Commodities Allocation. Public health commodities shall be given

to LGUs which are willing to partner with the DOH in the implementation of priority public health programs such as disease eradication initiatives (e.g. Schistosomiasis, Filariasis); or intensified efforts for disease prevention and control (e.g. hepatitis B vaccine provision for LGUs with already high fully immunized children coverage). Incentives for performance shall be given to the LGUs based on achievement of clearly defined and measurable improvement in the delivery of selected public health programs and objectives. These awards may be linked to the LGU scorecard and to the development of “LGU League Tables” to publish the relative performance of LGUs in different priority areas of their public health responsibility. Performance-based allocations and awards for public health would be based on performance agreements between the DOH and participating LGUs.

ii. Performance-Based Budgeting for DOH Retained Hospitals. A fund pool contributed to by DOH retained hospitals for upgrading of hospital facilities and services shall be established. Access to this fund shall be competitively determined and will be based on compatibility with local health care networks, competitiveness with the private sector, and contributions to clinical research and training, and performance. Special consideration shall be made on how well a facility can recoup and sustain support for the recurrent cost implications of proposed upgrading or investments.

c. Mobilization of Extra-Budgetary Resources The DOH shall lead in mobilizing extra-budgetary resources from official development assistance (ODA) and other development partners through the principles of Sector Development Approach for Health (SDAH) which shall be utilized for health reforms at the national and local level. Additional resources for health shall be mobilized by increasing the revenue generation capacities of health agencies without compromising access by the poor. This shall include revenues from user-fee charges from personal health care and regulatory services and rationalized use of real property assets belonging to government health agencies. Health agencies and facilities with revenue generating capacities shall not only support its own requirements but also contribute to meet the needs of non-revenue generating priority programs. However, such mechanisms shall be designed and introduced in a way that do not penalize or restrain fiscal performance among revenue generating agencies.

d. Coordination of National and Local Health Spending The DOH shall lead in coordinating national and local health spending especially in the implementation of national health programs and in the implementation of reform initiatives. This shall ensure that there shall be no duplication in health expenditure across all levels. Efforts to mobilize more investments for health shall be coupled with measures to improve efficiency in the system for maximizing the expected performance outputs using the available resources and properly distributing or allocating the resources where they shall yield the optimum health impact. Existing resources for health shall be focused on identified priority areas and programs specifically, direct subsidies from national and local governments shall be focused on basic and essential health goods and services commonly used by the poor. The overall management of total health investments shall be undertaken through the principles of SDAH where health resources shall be pooled and allocated rationally across all levels based on identified priority areas. The financing of F1 PPAs shall be jointly undertaken by the central and local government, PhilHealth, ODA and other partners. The mechanisms for mobilizing private sector resources shall likewise be

undertaken.

24

B. LGU Level

1. Support to the Expansion of the National Health Insurance Program

a. Support to the Attainment of Universal Coverage for Social Health Insurance Social marketing strategies shall be conducted among the LGUs to increase the enrolment of the indigent families to the Sponsored Program of the NHIP. The LGUs shall also assist in the implementation of social marketing strategies to increase the enrolment of the informal sector to the NHIP.

b. Assurance of Local Government Premium Counterpart The municipal, city and provincial LGUs shall ensure the allocation of budget from their Internal Revenue Allotment (IRA) for the payment of their premium counterpart in the enrolment of indigent families to the Sponsored Program. The LGUs may pursue legislation to peg a portion of their IRA to enroll the indigents identified in the tool for identification of the poor.

c. Adoption of PhilHealth Approved Tools for Identifying Indigent Families and Ensure their Enrolment to PhilHealth The LGUs shall adopt the PhilHealth approved tool for identifying indigent families for enrolment into the Sponsored Program to ensure that the true poor families will be given financial risk protection from catastrophic illnesses through social health insurance.

d. Compliance to PhilHealth Accreditation Standards The municipal, city and provincial LGUs shall ensure that their facilities such as the RHUs and hospitals shall meet the accreditation criteria of PhilHealth for them to qualify for the release of capitation and reimbursement from PhilHealth.

e. Rational Use of PhilHealth Capitation and Reimbursement The municipal and city LGUs shall ensure that capitation from PhilHealth shall be spent rationally following PhilHealth policies for its utilization. The hospitals of LGUs shall also ensure that they are claiming appropriate reimbursement from PhilHealth based on benefit packages and treatment guidelines and that the reimbursements are properly utilized according to PhilHealth policy.

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2. Increasing LGU Investments for Health a. Increasing Budget Allocation for Health Advocacy for the increased health budget allocation for capital outlay, maintenance and other operating expenses and personal services from the IRA shall be conducted among municipal, city and provincial LGUs.

b. Revenue Generation and Mobilization of Extra-Budgetary Resources The LGUs shall conduct revenue generation initiatives to sustain their financial resources for health such as collection of user-fee charges from health facilities without compromising the access of the poor and through the rationalized use of real property assets of health facilities such as establishment of income generating projects and economic enterprise within their areas of responsibility. The LGUs shall also be encouraged to mobilize extra-budgetary resources from donations, grants and loans coming from ODA and other partners in health. Other sources of financing for health can also be identified.

c. Income Retention of Health Facilities Advocacy to policy makers at the LGU level to allow income retention and utilization among LGU hospitals and other health facilities through local legislation shall be conducted. This shall ensure availability and increase resources for the provision of health services in LGU health facilities until they achieve fiscal autonomy.

3. Establishment of Local Health Accounts A Local Health Account, which is a system of monitoring and tracking the sources and uses of health funds, shall be established among LGUs. This shall serve as basis for planning to improve and sustain the investments for health at the local level.

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I. STRATEGIES Health regulation reforms aim to assure access to quality and affordable health products, devices, facilities and services, especially those commonly used by the poor. Strategies under this reform component include the following:

1. Harmonizing and streamlining licensing, accreditation and certification systems On the supply side, systems and processes for licensing, accreditation and certification shall be harmonized and streamlined to make health regulation more rational and client-responsive by: (1) establishing a “one-stop shop” for licensing of health facilities; (2) automating regulatory systems and processes; (3) integrating accreditation and certification into a unified “seal of approval” system; (4) introducing intensive but less frequent and incentive-based regulatory procedures; (5) decentralizing appropriate regulatory functions to regional offices and LGUs; and (6) strengthening enforcement mechanisms and regulatory oversight functions of the DOH.

2. Developing a “seal of approval” system on health products, facilities and services On the demand side, a “seal of approval” system shall be developed. Such seal shall indicate that a certain level of standard or competency has been achieved, assuring providers and clients that fair and ethical standards are met. The presence or absence of such seals shall enable consumers to make informed decisions and demand quality products and services. The use of the seals shall be expanded and operationalized to include public and private health facilities, laboratories, pharmacies, and devices. These seals shall be linked to incentives to meet progressively higher standards for safety, effectiveness and quality.

3. Pursuing cost recovery and income retention for regulatory agencies Consistent with the over-all financing strategy for health reforms, cost recovery and income retention for health regulatory agencies and other revenue-generating mechanisms shall be pursued to ensure financial sustainability. However, use of retained revenues shall be backed by a rational and approved expenditure plan.

4. Assuring the availability of quality and affordable medicines The availability of low-priced quality essential medicines commonly used by the poor shall be assured through the following mechanisms: (1) promoting high quality generic pharmaceutical products; (2) expanding pharmaceutical distribution networks; (3) identifying alternative local and foreign sources of low-priced pharmaceutical products; and (4) developing mechanisms for pooled procurement among health facilities and across LGUs to realize economies of scale.

Health Regulation

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A. National Level

1. Upgrading, Harmonization and Streamlining the Regulatory Systems and Processes The regulatory systems and processes of the DOH need to be upgraded, harmonized, streamlined and simplified. In the process, personnel and manpower implements would be rationalized and dedicated to more productive activities. On the side of the regulated, this agenda would derive customer trust in the system and, ultimately, satisfaction on the regulatory services provided.

a. Establishment of a One-Stop Shop for Licensure of Health Facilities In order to harmonize and streamline regulatory processes for health facilities; to reduce transaction costs and the costs of provision of regulatory services; and to increase customer trust and satisfaction, a One-Stop Shop System for the Licensure of Health Facilities shall be established at the DOH Central Office and the Centers for Health Development (CHDs). Initially the system shall include the licensure of hospitals, but would eventually cover other regulated health facilities that provide ancillary services such as dialysis clinics, ambulatory surgical clinics, medical facilities for overseas workers and seafarers and similar health facilities. In the One-Stop Shop Licensure System, a single license to operate shall be issued to the health facility which would cover all services provided within the premises of the health facility, including diagnostic and other ancillary services. There shall be a single license application process and unified inspection of the health facility that shall be conducted by a composite team of professionals with the technical expertise to determine compliance to regulatory standards.

Another important feature of the One-Stop Shop Licensure System shall be the automatic renewal of license. With this feature, the license to operate shall be renewed upon submission of required documents without prior inspection of the health facility. Compliance to regulatory standards shall be determined during intensified monitoring visits by the regulatory officers from the CHDs and DOH regulatory bureaus. Automatic renewal of license shall necessitate a more intensive, less frequent regulatory procedures that focus more on providing incentives for timely submission of applications such as discounts on license fees.

The implementation of the One-Stop Shop Licensure System shall be evaluated by 2009-2010. The system is expected to promote efficiency in health regulation, which shall in turn lead to the achievement of the F1 goals of responsiveness and client satisfaction. The Bureau of Quarantine (BoQ) shall set up a One-Stop Shop for the issuance of Certificate of Compliance to Criteria for Establishments’ Sanitation and Employees’ Hygiene for all establishments located inside the perimeter of airports and seaports nationwide.

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b. Automation of Regulatory Systems and Processes Upgrading of regulatory systems and processes shall be realized through the establishment of a “central regulatory hub” that will facilitate transactions in the regulatory bureaus and improve their information management system. This shall entail software development for the automation of systems and procedures for the regulation of health products, food, devices, drug establishments and facilities. Automation will increase efficiency in the regulatory bureaus as well as client satisfaction through better, faster and more convenient public service.

For the Bureau of Health Facilities and Services (BHFS), there is the ongoing development and implementation of the computer-based Integrated Drug Test Operations and Management Information System (IDTOMIS). Its objective is to make efficient and effective the current systems and procedures for accreditation of drug testing laboratories and drug abuse treatment and rehabilitation centers through on-line application and payment systems, registration of clients, and verification and confirmation of drug test results through the development and implementation of computer-based systems.

The Bureau of Food and Drugs (BFAD) is currently undergoing automation of its regulatory systems and processes. Likewise, automation of its systems and processes is being proposed by the Bureau of Health Devices and Technology (BHDT) as well as the BoQ.

c. Decentralization of Appropriate Regulatory Functions to Regional Offices and LGUs The decentralization of appropriate regulatory functions to CHDs and LGUs would help streamline regulatory systems and processes, to the benefit of both the government and the private sector by improving efficiency and reducing the cost of regulation as well as reducing transaction costs incurred by the latter. Decentralization would also free-up resources that could be used to strengthen standards development, enforcement, surveillance and oversight functions of the DOH regulatory offices. Decentralization to the CHDs shall initially be undertaken for the licensing process for hospitals and clinical laboratories. Other health facilities and other health regulatory functions shall be targeted later on, based on the evaluation of initial decentralization efforts. Similarly, the decentralization of selected regulatory functions to LGUs shall be based on the experience with decentralization to CHDs. In addition, a research study on the capacity of LGUs to undertake health regulatory functions shall be conducted. The data that will be obtained shall serve as basis for policy decisions on decentralization of regulatory functions to LGUs. The BoQ shall decentralize appropriate regulatory functions to major quarantine stations nationwide. In the background of decentralization, the DOH regulatory bureaus shall re-orient their organizational goals and functions, focusing more on regulatory standards development, supervision and monitoring, surveillance and oversight. They shall endeavor to build up the capacity of CHDs, other field units (i.e. quarantine stations) and LGUs to perform decentralized regulatory functions, particularly the training of personnel.

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d. Upgrading of the Critical Capacity of Regulatory Agencies

The regulatory bureaus shall develop and implement their master plans to upgrade laboratory equipment, services, systems and processes including the retooling and retraining of their health human resource.

e. Strengthening of Enforcement Mechanism and Regulatory Oversight Functions of the DOH Legislation that will strengthen and expand the regulatory mandates of the DOH shall be proposed. In the background of decentralization of selected regulatory functions, the regulatory oversight functions of the DOH regulatory bureaus shall be emphasized in the proposed legislation, as well as in any policy initiatives on health regulation. Outsourcing is the contracting out or buying in of goods or services from external sources, whether government or private, instead of the regulatory bureaus providing such services themselves. This can take the form of a regulatory bureau transferring the operation of a certain regulatory service to a private firm. Initial efforts on outsourcing or contracting out of selected regulatory services to other government agencies or the private sector shall be evaluated for efficiency and effectiveness, particularly in terms of strengthening enforcement and promoting compliance to regulatory standards. The regulatory bureaus shall also determine which among their remaining regulatory functions may be outsourced or contracted out. The presence of specialized service support systems and expert services is needed to assure continuous compliance with the technical requirements of the regulatory bureaus. There should be a regulatory mechanism to recognize or deputize specialized or expert service providers through accreditation or certification systems. In order to promote geographic access to hospital facilities and to maximize the use of limited health resources, the DOH shall expand the scope of hospital regulation by controlling the establishment of new hospitals through the institution of the Certificate of Need as a requirement for the issuance of a permit to construct and license to operate a hospital. Similarly, there is a need to promote access to medical equipment to where they are needed most by coming up with a list of essential health technologies for each level of health care systems.

2. Development of Quality Seals for Health Products, Food, Devices, Drug Establishments, Facilities and Services The DOH regulatory bureaus shall develop an operational framework for the implementation of seal of approval system for health regulated products, devices, and facilities. The quality seal system is intended to take quality a notch higher than the regulatory requirements for the issuance of permits, licenses or authorization to enter the market. The quality seal issued for products, devices and facilities will serve as signal for the public as to conformance with internationally accepted standards of quality and that fair and ethical standards are met. The seal will enable the consumers to make informed decisions and demand quality health products, devices and facilities in a competitive market. The BoQ has integrated all accreditation into a Unified Seal of Approval by subscription to the Hazard Analysis Critical Control Point and the Good Manufacturing Practice since 2004. BoQ also developed the Quality Seals for Food Service Establishments within the perimeter of airports and seaports.

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The DOH and PhilHealth shall harmonize the Sentrong Sigla Certification (Phase II level 1) and the PhilHealth accreditation of RHUs and BHSs by integrating PhilHealth accreditation standards for RHUs/BHSs into the basic certification standards of the Sentrong Sigla.

3. Harmonization of Systems and Processes of DOH Regulatory Offices with ASEAN Standards Globalization has already facilitated economic exchanges including trade in health services and goods among countries. However, the currently different regulatory requirements of each country are viewed as technical barriers to trade. This led the different countries to standardize their regulatory systems and processes within an agreed time frame known as the road map leading to ASEAN harmonization. Failure of the Philippines to harmonize their standards and processes will not protect the consumers from the possible dumping or entry of substandard or counterfeit products coming from other countries. The BoQ has a long standing coordination and cooperation with other ASEAN countries: Brunei Darussalam, Indonesia, Malaysia and the Philippines East Asia Growth Area. There is a continuous quarterly meeting in each country by rotation attended by representatives from their Customs, Immigration, Quarantine and Security since 1994. For medical devices and equipment, the ASEAN countries are looking for integration measures on the regulatory systems and processes such as:

A common submission dossier for product approval;

An abridged approval process for medical devices which Regulatory Authorities of benchmarked counties or regional RAs have already approved;

A harmonized placement of medical devices into the ASEAN market based on common product approval process; and

A formalized post marketing alert for defective or unsafe medical devices and equipment

Along these activities, the Philippine DOH joined the ASEAN Harmonization Working Party and worked in parallel with Global Harmonization Task Force on technical harmonization efforts.

4. Improvement of the Availability and Access to Low-Cost and Quality Essential Medicines and Other Health Commodities According to the World Medicines Situation, a 2004 publication of the World Health Organization (WHO), only 66% of the country’s population had access to essential medicines. Access is measured based on the estimated percentage of the population with access to at least twenty (20) essential medicines. The latter must be continuously available and affordable at a health facility or medicine outlet and within an hour’s walk from the patient’s home. Access to essential life-saving drugs depends on the availability and affordability of such, especially in areas of high morbidity and mortality. Moreover, other factors also influence and have direct or indirect effects to access to essential drugs and medicines namely: rational selection and use of medicines, tailored procurement, sustainable financing and reliable health and supply systems. In line and espoused within the National Objectives for Health to achieve the Medium Term Philippine Development Plan and Millennium Development Goals, the following interventions have been prioritized to achieve our envisioned goal of better health outcomes through the provision of essential drugs and medicines, especially for the poor and underserved.

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a. Promotion of High Quality Generic Pharmaceutical Products Promotion of high quality generic pharmaceutical products shall be pursued among producers, distributors, retailers, medical and dental practitioners and consumers. BFAD shall ensure that generic pharmaceutical products are of high quality through their regulatory systems and processes. Rational prescribing of drugs and medicines among medical and dental practitioners shall be enforced according to the Pharmacy Law (RA 5921) and Generics Act (RA 6675). Rational drug use shall be promoted among patients and consumers of drugs and medicines to ensure safety and attainment of desired therapeutic effects. The advocacy for the establishment of functional therapeutic committees in government and private hospitals shall be strengthened. Another strategy is the P100 program which is being implemented by the DOH. This program has the main objective of ensuring access to drugs and medicines which are packaged within an affordability parameter of 100 pesos or below. This program shall be piloted in 100 hospitals (DOH and LGUs).

b. Expansion of Pharmaceutical Distribution Networks On the objective of achieving availability and access to low-priced quality essential drugs and medicines commonly bought by the poor are enhanced, the intent is to saturate the market with low-cost essential drugs and medicines through the following strategies:

i. Botika ng Barangay (BnB). The BnB program seeks to make quality essential drugs and

medicines more affordable and available to the Filipino people down to the Barangay level among the poorest of the poor. Regulatory requirements for establishing BnB were streamlined for facility and seed capital investments were planned and provided for from the DOH to assist LGUs in pushing for and realizing the objectives of the Program. The current target is to establish one BnB to serve three adjacent barangays. To date, there are more than 11,000 BnBs all over situated even in the most far flung areas of the country.

ii. Botika ng Bayan (BNB).The DOH together with the Philippine International Trading

Corporation (PITC) launched in December 2004 the BNB project to set up a nationwide network of privately-owned and operated accredited pharmacies that sell low-priced parallel imported or generic drugs with the aim of competing with commercially priced drugs and medicines in the market. At least 1,500 outlets have been opened so far.

c. Identification of Alternative Local and Foreign Sources of Low-Priced Quality Drugs and Medicines Alternative local and foreign sources of low-priced and quality essential drugs and medicines shall be identified. PITC’s Parallel Drug Importation (PDI) of cheaper drugs and medicines of similar brands and therapeutic dose of that which is locally produced shall be carried on. This scheme shall challenge the local manufacturers to lower down the market prices of their drugs and medicines. Currently, there are fifteen (15) essential drugs and medicines under the PDI that are sold in 72 DOH hospitals and three (3) LGU hospitals.

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d. Development of Mechanism for Pooled Procurement among Health Facilities across LGUs Mechanisms for pooled procurement among health facilities across LGUs shall be developed to capture the benefits of economies of scale through the execution of Memorandum of Agreements (MOAs) or Memorandum of Understanding (MOUs).

5. Institutionalization of Cost Recovery and Revenue Enhancement Mechanisms for Health Regulatory Agencies Regulatory fees are drawn from the regulated entities in order to defray the cost of administration. This stems from the principle that the granting of a license to operate in a regulated market is a privilege and not a right. The fees to be derived should be commensurate to the administrative cost which necessitates the restructuring of current regulatory fees. The BoQ has restructured its regulatory fees in 2005. This was followed by the BHFS in 2006, when it started to implement a rationalized schedule of fees for the regulation of health facilities. BFAD and BHDT shall also re-structure their own regulatory fees based on actual administrative costs. The BoQ is mandated to retain and utilize at least fifty percent (50%) of its income by virtue of Republic Act 9271 of 2004. DOH shall continue to push for the approval of the special provision on income retention and utilization by BFAD, BHDT and BHFS under the General Appropriations Act or its enactment in a Republic Act (RA). The BHFS shall continue to propose the implementation of the provision in Section 17 of the Hospital Licensure Act or Republic Act 4226 that allows the hospital licensing agency to retain funds collected from permit to construct, registration and license to operate fees for hospitals and other health facilities covered by the RA. Income retention and fiscal autonomy, with appropriate control and auditing systems, is expected to result in better performance of the health regulatory bureaus.

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B. LGU Level

1. Enforcement of National Health Legislation, Policies and Standards The LGUs may exercise their health regulatory functions through the localization, implementation and enforcement of national health legislation, policies and standards, such as the Expanded Child Care Development, Asin Law, Food Fortification Law and Sanitation Code, shall be pursued in public and private health facilities.

2. Legislation and Localization of Health Regulatory Policies at the Local Level The adoption and localization of national health regulatory laws and policies shall be pursued among LGUs through legislation, creation of resolution and executive issuances at the municipal, city and provincial levels. The LGUs may also pursue local health policy development appropriate to their prevailing situation.

3. Improvement of the Availability and Access to Low-Cost Quality Essential Medicines and Other Health Commodities The LGUs shall conduct promotion of high quality generic pharmaceutical products among physicians and consumers. Pharmaceutical distribution networks shall be established at the LGUs such as the Botika ng Barangay, Botika ng Bayan and Health Plus. Rational drug use shall be promoted among consumers and rational prescribing of drugs and medicines shall be advocated to medical and dental practitioners according to the Pharmacy Law and Generic Act. Advocacy for the establishment of therapeutic committees in LGU and private hospitals shall be pursued. Development and implementation of mechanisms for pooled procurement among health facilities across LGUs shall also be advocated through the execution of MOAs and MOUs.

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I. STRATEGIES The objective of service delivery reforms is to improve the accessibility and availability of basic and essential health care for all, particularly the poor. The following strategies are utilized to attain this objective:

1. Ensuring availability of basic and essential health service packages

Basic and essential health service packages shall be made available in all localities while specific and specialized health services shall be made available by designated providers in strategic locations. This will ensure the continuity of health services from the primary, secondary up to tertiary levels of care.

2. Assuring the quality of both basic and specialized heath services The quality of both basic and specialized health services shall be assured through the following mechanisms: (1) health facilities shall be upgraded and human resource capability of these facilities shall be strengthened to comply with licensing and accreditation requirements; (2) these facilities shall follow accepted standards of care such as clinical practice guidelines or diagnostic related groups; and (3) the provision of specialized diagnostic procedures and services as well as specialty services involving the management of complicated diseases and conditions which shall be assigned to preferred providers as incentive for delivering quality and affordable services.

3. Intensifying current effort to reduce public health threats Current efforts to reduce public health threats shall be intensified by: (1) undertaking disease-free zones initiative targeting malaria, filariasis, schistosomiasis, rabies, leprosy and vaccine-preventable diseases for elimination as public health threats in endemic areas; (2) implementing intensified disease prevention and control strategies for priority diseases such as tuberculosis and HIV/AIDS; and (3) enhancing health promotion and disease surveillance activities directed at prevention and control of communicable and non-communicable diseases and health risk-taking behaviors.

Health Service Delivery

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A. National Level

1. Public Health Development Program a. Establishment of Disease-Free Zones Initiatives The disease-free zone initiative aims to “mop up” diseases such as leprosy, schistosomiasis, filariasis, rabies, and malaria in selected localities in support of the NOH goals to eliminate these diseases as public health problems. This would entail stratification of areas according to the burden of disease, validation of the status of potential disease-free areas, and identification of appropriate interventions. The DOH shall pursue policy and standards development, provision of technical assistance to improve service delivery at nationwide scale, monitoring and evaluation as well as bulk procurement of commodities necessary for the implementation of disease-free zones initiatives.

b. Intensifying Disease Prevention and Control Programs Intensified disease prevention control strategies shall be implemented to reduce morbidity and mortality from vaccine-preventable diseases, tuberculosis, HIV/AIDS, dengue and emerging and re-emerging diseases such as SARS and avian influenza. These efforts are particularly geared toward the attainment of the MDG targets. DOH shall continue to provide policy directions, monitor program implementation and mobilize resources from budgetary and extra-budgetary resources to finance diseases prevention and control programs and conduct bulk procurement of commodities for the vaccine-preventable diseases, rabies, tuberculosis, HIV/AIDS and index cases of emerging and re-emerging diseases as necessary for distribution to appropriate facilities.

c. Improving Reproductive Health Outcomes

i. Enhancement of Child Health Programs. The improvement of child health outcomes such as the Neonatal Mortality Rate (NMR), Infant Mortality Rate (IMR), Under Five Mortality Rate (UFMR) and Child Mortality Rate (CMR) depend on strengthening maternal and child health programs, development and implementation of new policies and standards, and ensuring availability and accessibility of public health commodities and services. This includes attendance during the delivery of neonates by skilled health professionals in health facilities; implementation of the Expanded Program on Immunization (EPI) through the administration of BCG, DPT, OPV and Hepatitis B vaccine; deworming; ferrous sulfate and Vitamin A supplementation to children; administration of tetanus toxoid to pregnant mothers for the protection of neonates from tetanus neonatorum; breastfeeding program; Integrated Management of Childhood Illnesses (IMCI) and nutrition services among others.

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ii. Maternal Health Programs. The improvement of reproductive health outcomes such as

the Maternal Mortality Ratio (MMR),Total Fertility Rate (TFR), Contraceptive Prevalence Rate (CPR) depend on the strengthening of maternal health programs, development and implementation of new policies and standards, and ensuring availability and accessibility of public health commodities and services. This includes provision of ferrous sulfate, Vitamin A, and tetanus toxoid; conduct of prenatal and postnatal check-ups and assistance during delivery by skilled health professionals and delivery in health facilities capable of providing Basic or Comprehensive Emergency Obstetric Care (BEmOC or CEmOC); family planning; Contraceptive Self Reliance (CSR); adolescent health and other reproductive health initiatives as well as maternal nutrition among others. The promotion of Safe Motherhood Policy, in which all pregnancies are treated as high risk, and maternal death reviews shall be considered for all maternal deaths. BEmOC and CEmOC facility mapping and upgrading shall be advocated by the DOH including the creation of Women’s Health Team, implementation of CSR and other Reproductive Health (RH) programs among LGUs.

d. Intensification of Healthy Lifestyle and Management of Health Risks

The advocacy and promotion on healthy lifestyle for the prevention of cardiovascular diseases, diabetes mellitus, chronic obstructive pulmonary disease, breast and cervical cancers shall be intensified. Campaigns against risk behaviors such as physical activity, healthy diet and smoking cessation shall be promoted. Risk factor screening such as blood pressure monitoring, breast examination, digital rectal examination and others shall be advocated as part of routine examination of patients. Strengthening of networks with professional and other private groups shall be undertaken to set up local support and advocacy teams for Healthy Lifestyle campaigns. Advocacy for safe water and sanitation programs shall also be conducted.


Threats of emerging and re-emerging infections such as Severe Acute Respiratory Syndrome (SARS) and avian influenza necessitates the creation and strengthening of the disease epidemiology and surveillance network through enhancing the Epidemiology and Surveillance Units (ESU) at all levels of government units – municipal level (Municipal Epidemiologic and Surveillance Unit or MESU), city level (City Epidemiologic and Surveillance Unit or CESU) and at the level of the province (Provincial Epidemiologic and Surveillance Unit or PESU). Tracking of disease incidence as well as the development and implementation of prompt response shall be greatly facilitated by the institutionalization of ESU networks in all LGUs. Regional Epidemic Management Committee (REMC) shall be created at the regional level. In line with these initiatives, linkages with private sector practitioners who serve a significant part of the population shall be strengthened and be made more efficient.

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f. Strengthening the Disaster Management System Prevention of loss of lives during emergencies and disasters requires strengthening of health emergency and disaster preparedness, response, recovery and rehabilitation including poison control across all levels. This shall be done through the organization, integration and coordination of the entire health sector for emergency and disaster preparedness and response and by providing and augmenting the necessary logistic resources for effective and efficient response to the same. The National Disaster Coordinating Council (NDCC) Memorandum Order No. 5, s. 2007 has institutionalized the cluster approach in the Philippine Disaster Management System from the national to the provincial level where the DOH is the main interlocutor or lead agency in the four clusters (Health; Nutrition; Water, Sanitation and Hygiene (WaSH) and Psychosocial Services) with the counterpart Inter-Agency Standing Committee Country Team as support, with defined roles and responsibilities. The DOH, as the national policy institution, shall formulate, disseminate and implement the policy on health emergency management from which the local government, non-government organizations and other members of the health sector will anchor their thrusts and directions for health emergency management. The DOH shall take the lead in the development and advocacy of the all–hazard approach in health emergency preparedness, response and recovery (HEPRR) plan in all DOH health facilities (CHDs and DOH Retained Hospitals). The development of the plan defines in advance the arrangements, procedures, advocacy awareness, health emergency response coordination and monitoring, logistics pre-positioning and donations tracking and other related activities that will enable these health facilities to effectively prepare for, response to and recover from emergencies and disasters. The CHDs and the DOH Retained Hospitals shall continue to serve as the regional front liners to any emergencies and disasters in their respective area. The CHDs take care of the institutionalization and coordination of health emergency preparedness and response at the local level, while the DOH Retained Hospitals provide the needed pre-hospital care (first aid care, ambulance transfer and referral) and hospital care. The Regional and Hospital Emergency Operation Centers shall be established or sustained in order to report and update the DOH Central Monitoring Center all the emergencies and disasters in their respective jurisdiction. The Regional Health Emergency Network (RHEN) shall be established at the regional level through a MOA with different stakeholders. Policy formulation, advocacy, networking, coordination and monitoring shall also be implemented for the promotion of Safe Community and Safe Hospitals assisting in building awareness to effect changes and improve disaster risk reduction capacity in emergency management.

g. Intensification of Health Promotion and Advocacy

i. Review of Health Promotion Interventions and Technology Upgrade. Effective health promotion activities will save the government a substantial amount of money as people change their lifestyle and health-seeking behaviors. Thus, current health promotion interventions need to be reviewed and appropriate technology upgrades be undertaken.

ii. Strengthening Health Promotion in Health Service Packages. Health promotion shall be

strengthened and incorporated into health service packages. Aggressive promotion of F1 adoption to stakeholders, especially the LGUs and the public, will be undertaken.

iii. Integration of Patient Education in Clinical Practice Guidelines. Patient education

shall be integrated into clinical practice guidelines to ensure that patients and their caregivers receive relevant information on disease causes, management, and prevention.

iv. Creation of a Health Promotion Foundation. A Health Promotion Foundation shall be

established to facilitate health education and promotion activities. The start up fund for this foundation could be initially taken from revenues derived from excise taxes on alcohol and tobacco products.

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2. Health Facilities Development Program

a. Rationalization of Health Facilities and Services Including the Provision and Capacity Building of Human Resources for Health

Rationalization of the health facilities and services guarantees the delivery of quality health care services by providing appropriate access to the right facilities in the right places and with the right professionals. It also drastically limits the rapid rise in cost of the health care system by reducing excess capacity; removing wasteful duplication of services and ensuring a continuity of care from primary or home based care to specialized care. Health care facilities and health providers operating within a health care delivery system of a specific area shall follow a set of guidelines that would enable them to rationalize their facilities and services based on the health needs of the community they serve. This covers public and private health care providers, national and local health facilities such as health centers and RHUs, BEmOC and CEmOC, drug outlets, laboratories and hospitals. DOH shall pursue facility mapping for public and private facilities for all these facilities to ensure access of the population to health care services. Assistance for the rationalization of facilities and services shall be provided to include critical upgrading of facility and equipment. The DOH shall also ensure health human resource capability building and venue for professional enrichment.

b. Integration of Wellness Services in Hospitals Retained hospitals shall re-establish themselves as “Centers for Wellness,” to enable them to provide promotive and preventive care to patients on top of curative care. There is a need to evaluate the previous implementation of this program in order to identify key areas for improvement.

c. Hospital Development Planning DOH hospitals shall complement local health facility networks to protect the poor and exert pressure on the private sector to deliver competitively priced quality health care. This applies especially for specialty services if continued access to national subsidies were to be justified. Hospitals must also contribute to the production of health technology by conducting research and training. Retained health facilities need to be competitive and must undergo critical upgrading of infrastructure, staffing, and equipment in order to provide quality services to clients. A pool of funds from the contributions of DOH hospitals shall be created for hospital upgrading. Access to this fund shall be determined in a competitive manner with special consideration on how well the facility can generate and sustain support for the recurrent cost implications of proposed upgrading and investments.

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B. LGU Level

1. Public Health Development Program

a. Disease-Free Zones Initiatives The LGUs shall implement the policies, programs and initiatives to “mop up” diseases to include leprosy, schistosomiasis, filariasis, rabies, and malaria in support of the NOH goals to eliminate these diseases as public health problems. The LGUs may pursue local legislation of policies to support the disease-free zones initiative such as vaccinating all dogs to control rabies and regular clearing of waterways to remove breeding sites of mosquitoes harboring malaria among others. Awards and incentives for frontline workers and facilities may be developed to enhance the implementation of disease-free zone initiatives at the local level.

b. Intensified Disease Prevention and Control Programs Intensified disease prevention control strategies shall be implemented among the LGUs to reduce morbidity and mortality from vaccine-preventable diseases, tuberculosis, HIV/AIDS, dengue and emerging and re-emerging diseases. Local legislation to facilitate the implementation of disease prevention and control programs as well as to provide incentives to health workers may be developed.

c. Improving Reproductive Health Outcomes

i. Implementation of Child Health Programs. The LGUs shall implement child health programs that include EPI, breastfeeding, IMCI, nutrition services, deworming, distribution of ferrous sulfate, Vitamin A and tetanus toxoid vaccination among others. The LGUs may legislate policies to increase the incentives and benefits of health workers to increase their morale in the implementation of child health programs and projects.

ii. Implementation of Maternal Health Programs. The LGUs shall ensure the implementation of maternal health programs such as the delivery of pregnant mothers in BEmOC and CEmOC facilities by skilled health professionals; conduct maternal death reviews; tetanus toxoid immunization; prenatal and post-natal check-ups; distribution of iron supplements to pregnant mothers and distribution of iron and Vitamin A to lactating mothers among others. The LGUs shall develop Women’s Health Teams consisting of physicians, nurses, midwives, trained traditional birth attendants and volunteer health workers. The Women’s Health Team will attend to deliveries and implement family planning and other RH programs. The LGUs may develop family planning, contraceptive self reliance and reproductive health ordinances among others to ensure the improvement of maternal health.

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d. Intensifying Healthy Lifestyle and Management of Health Risks The LGUs shall intensify programs and activities that promote healthy lifestyle to prevent cardiovascular diseases, diabetes mellitus, chronic obstructive pulmonary disease, breast and cervical cancers. This shall include promotion of smoking cessation, right diet, exercise, stress management, safe water, and sanitation among others. The LGUs shall network with professional and other private groups in setting local support and advocacy teams for healthy lifestyle. The LGUs may develop health ordinances such as a Tobacco Control Ordinance to support the implementation of healthy lifestyle and the management of health risks.

e. Strengthening the Epidemic Management and Surveillance System The disease epidemiology and surveillance networks shall be enhanced at all LGU levels to include PESU at the provincial level, MESU at the municipal level and CESU at the city level including their close linkage and collaboration with the private sector in their localities. Provincial Epidemic Management Committees shall also be established at the provincial levels.

f. Strengthening the Disaster Preparedness and Response System The LGUs are the first and frontline agencies to deal with disasters. With the growing number of emergencies and disasters happening in the country, strengthening the capability of the LGUs in emergency preparedness and coping mechanisms on natural and human induced hazards are high priorities. The LGU’s disaster risk management plans and activities are aimed in strengthening and enhancing their capability in affecting the course of the preparedness, mitigation, response and recovery from disasters. The LGUs shall establish, institutionalize and strengthen their disaster management and response system at the municipal, city and provincial levels. The LGUs shall ensure the formulation of Health Emergency Preparedness, Response and Recovery Plan for the LGU health facilities to minimize the effect of disasters while at the same time capitalize on opportunities in improving their over-all capabilities in health emergency management. Provincial, Municipal and City Health Emergency Network (PHEN / MHEN / CHEN) shall be established through a MOA with stakeholders at the provincial, municipal and city levels. These networks will plan and identify deliverables at their levels to reduce the impact of disasters. The LGUs shall also support the passage of ordinances and executive issuances to strengthen the disaster management system at all levels. Advocacy activities shall also be conducted for the development of safe community and safe hospitals aimed at strengthening and enhancing the capability of the communities to protect the development gains of the communities against threats posed by natural and human-induced disasters.

g. Intensifying Health Promotion and Advocacy

i. Behavior Change Communication. The promotion of behavior change for health shall be intensified to improve the health seeking behavior, attitude and values of the local population towards health and health related matters.

ii. Localization of Health Promotion and Advocacy Materials. Health promotion and

advocacy materials shall be localized using the vernacular or dialect for easier understanding of the population in a particular area.

iii. Intensification of Patient Education in Clinical Practice. Patient education shall be

incorporated in the treatment and management of patients in public and private health care facilities.

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2. Health Facilities Development Program

a. Rationalization of Local Health Facilities to Include BEmOC / CEmOC and the Provision and Capacity Building of Human Resources for Health Rationalization plan of LGU health facilities shall be developed and implemented to ensure that there is a continuity of care from primary, secondary and tertiary level. This shall cover the BHSs, RHUs, BEmOC and CEmOC facilities. The LGUs should ensure that core referral hospitals and CEmOC facilities are offering regular and emergency services on a 24-hour basis. This shall entail the merging of adjacent facilities and their health human resource, facility level adjustment and reconfiguration including facility and equipment development. Facility mapping shall be conducted among LGUs to serve as basis for the rationalization plan. The LGUs may develop local ordinances to ensure the implementation of rationalization plans to optimize the utilization of health facilities. LGUs which are lacking in HRH shall be encouraged to develop mechanism to ensure the application, hiring and retention of necessary HRH to include legislation, executive issuances and memorandum of agreements for salaries and benefits. The DOH shall also assist in the training and professional development of LGU HRH.

b. Integration of Wellness Services in Hospitals The LGU hospitals shall provide promotive and preventive care to patients on top of curative care.

c. Compliance to PhilHealth Accreditation Standards for Health facilities The health facilities of the LGUs should be able to meet the accreditation standards of PhilHealth to ensure the release of capitation and reimbursements. LGU facilities may need to improve the health facilities and equipments, human resource complement and training.

e. Compliance to DOH Licensing Standards for Health Facilities The health facilities of the LGUs need to follow the licensing procedures and criteria of the DOH regulatory agencies to ensure the provision of quality services and to prevent legal encumbrances that may occur during the operation of their health facilities.

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I. STRATEGIES

The objective of good governance in health is to improve health systems performance at the national and local levels. This involves interventions that cut across all areas of health reform and employs these key strategies:

1. Improving governance in local health systems Governance in local health systems shall be improved by: (1) establishing inter-local health zones which shall undertake integrated implementation of health reform components; (2) developing and employing a performance assessment system (LGU Scorecard system) to track progress of health reforms; and (3) institutionalizing a health professional development and career track system where competent and dedicated health personnel provide quality health services.

2. Improving national capacities to manage and steward the health sector National capacities to manage and steward the health sector shall be improved through: (1) strengthening technical leadership and management capability at central and regional levels; (2) improving public finance and procurement management systems; (3) strengthening information and communication technology capability to improve connectivity of the health sector and ensure access to quality health information; and (4) strengthening monitoring and evaluation, research and knowledge management systems to support a more rational performance assessment system and an evidence-based health policy development and decision-making process.

3. Developing a rationalized and more efficient national and local health systems The development of rationalized and more efficient national and local health systems shall be pursued through strengthening networking mechanisms and referral systems, sharing of resources, organizational transformation and restructuring, and capacity building.

Good Governance

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II. PROGRAMS, PROJECTS AND ACTIVITIES A. National Level

1. National and LGU Sectoral Management

a. Strengthen Stewardship of National and Local Health Systems Governance over the Philippine health system entails effective and responsive stewardship of national and local health systems. The development of rationalized and more efficient national and local health systems will be pursued through strengthening of networking mechanisms and referral systems, sharing of resources, organizational transformation and restructuring, and capacity building among others. The DOH shall lead the LGUs towards effective stewardship of their local health systems through the institution of health reforms at the local level. This shall be done through the establishment of FOUR-in–ONE convergence sites where all four reforms - health financing, health regulation, health service delivery and good governance are implemented initially in 16 provinces then eventually in the rest of the country. The key elements in the implementation of these FOUR-in-ONE sites are: investment planning; service delivery flow and referral network in a province-wide system; formation of inter-local health zones leading to province-wide governance mechanisms and institutions for the health system; and rationalization of central support to F1 convergence sites. A roll-out framework and plan shall be developed and implemented for the expansion of F1 convergence sites to other areas based on lessons learned from pilot convergence sites. LGUs that may not yet have the capacity to adopt a convergence approach to implement health reforms shall be assisted in the development of functional inter-local health systems based on learning derived from best practices. Improvement in the capacity of local health authority to manage and coordinate the functions of the local health system shall be pursued. Promotion and advocacy for increased inter-LGU cooperation and coordination as well as public-private partnership shall also be intensified.

b. Strengthen the National Human Resources for Health Program The Philippines is producing more and better human resources for health (HRH) compared to most Asian countries. Ironically, some areas in the Philippines suffer from lack of professional health providers. This is partly due to the uneven distribution of HRH across the country and the large exodus of nurses and physicians in the last four years which is a phenomenon that is unparalleled in the migration history of the country. In lieu of this, an HRH Master Plan will be developed to mitigate this growing problem. Technical leadership and management capability at the central and regional levels will be strengthened through retooling and retraining of central office and CHD personnel as well as tapping DOH representatives to serve as vital links to the LGUs.

i. Human Resource for Health Planning and Production. HRH Planning shall be done by getting the total workforce requirements and corresponding costs based on parameters like current population and population growth, current stock of HRH category and attrition rate, and preferred health worker to population ratio. It should then follow that the production of health manpower shall be based on the actual and projected requirements of the health delivery system.

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ii. Human Resource for Health Utilization and Placement. A recruitment and selection system shall be developed based on actual job competencies. At the same time, rewards and incentive mechanism through a performance management system shall be developed to motivate health professionals to continue personal development and improve job performance. Actual career development and management shall be conducted to support health manpower through retention planning, individual career planning, career pathing and succession management. These processes shall also ensure that a qualified professional will be ready to continue the service of a vacated position. The DOH shall continue to augment necessary HRH at the local level when necessary through the implementation of the Doctors to the Barrios and Rural Health Practice Program, provision of a pool of Medical Specialist and provision of Medical Officers.

iii. Human Resource for Health Learning and Development. Strategy driven, competency-based training and development interventions shall be aggressively pursued to equip HRH at the national, regional and local levels with knowledge, attitudes and skills required to carry out reforms in the country’s health care system.

iv. Human Resource for Health Information System. Different HRH Information Systems shall be installed to capture employee information, support HRH Management and Development systems, announce job vacancies in the health sector and generate baseline HRH data for use in planning. There is a need to communicate these health human resource thrusts and resources to both the health workers and the communities.

c. Sector Development Approach for Health Implementation The Sector Development Approach for Health (SDAH) is a major strategy to ensure that there is a coordinated national effort towards the thrusts and strategies of the country. This shall strengthen government leadership in implementing a health sector program where development partners cooperate and contribute according to priority thrusts. Effective donor and LGU coordination and harmonization of procedures shall be established.

d. Institutionalization of the Monitoring and Evaluation of Health Reforms A monitoring and evaluation system shall be developed, tested, and applied in order to monitor F1 implementation of all stakeholders at all levels. This shall be called the Monitoring and Evaluation for Equity and Effectiveness (ME3) which shall include scorecards for DOH central offices, CHDs, hospitals, LGUs and donor agencies. Monitoring and evaluation tools shall be developed through a consultative, iterative and objective process. Qualitative and quantitative means of evaluation shall be utilized.

To maximize the use of the monitoring and evaluation system and keep it responsive to changes during the medium term, there is a need to develop the monitoring and evaluation capabilities, including research skills of DOH central office and CHD personnel.

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e. Strengthening the Philippine Health Information System Health information should be managed, disseminated and utilized effectively. In line with this, a Philippine Health Information Network (PHIN) shall be institutionalized which shall serve as the “data portal” or a search engine for all health information. Easily accessible data shall make not only health planning easier but also support cooperative efforts with partners. With both public and private sector using the same information source to monitor and plan, efforts and interventions shall become more complementary.

Efforts in this regard shall include harmonization of information systems of different stakeholders in health. This will include information systems on human resource, vital registries and health statistics, disease surveillance, national and local health accounts, health regulations, and health facilities. To maximize the use of the information system, the DOH as well as the other health sector stakeholders shall develop systems on knowledge management which includes not only information systems but also development of knowledge management oriented decision-makers, staff and processes.

2. DOH Internal Management

a. Strengthening the Public Finance Management The financial management capacity at DOH central office and CHD levels shall be strengthened by developing a comprehensive and integrated financial management and information. This shall be done through the computerization of budgeting and accounting systems, monitoring and evaluation of fund sources, and development of feedback mechanisms for fund utilization at all levels, and strengthened internal audit capacities. Such systems shall include the Electronic National Government Accounting System (e-NGAS) and Medium Term Expenditure Framework (MTEF) among others.

b. Strengthening the Procurement and Logistics Management The DOH procurement, logistics and warehousing management system shall be strengthened. This shall cover the inventory system, supply chain mechanism, efficient storage, database of goods and supplies with standard specifications, pooling, monitoring, and feedback mechanisms incorporated in the procurement systems, database of suppliers with performance monitoring, standardization of specifications and documents, and the implementation of ethical practices.

d. Asset Management The DOH shall undertake a comprehensive and systematic process of effectively acquiring, maintaining, upgrading, operating and disposing its assets to maximize the utilization and worth of these assets.

e. Strengthening the Internal Audit The systems and procedures for internal audit of DOH shall be strengthened to monitor the financial and internal operations and performance of the DOH to make sure that all resources are managed and utilized in accordance to prescribed laws and regulations.

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B. LGU Level

1. LGU Sectoral Management

a. Strengthening the Local Health Systems Development The DOH shall lead the LGUs towards effective stewardship of their local health systems through the institution of health reforms at the local level. This shall be accomplished primarily through the establishment of FOUR-in-ONE convergence sites where interventions under all four F1 reform components: good governance, health regulation, health financing and health service delivery shall be implemented. Systems and processes for inter-LGU cooperation, public-private partnership and community participation shall be established.

b. Strengthening the Local Health Human Resource Management System Strengthening Parallel to national efforts, a local health human resource strategy shall be developed and implemented at the LGU level. Efforts shall include the development of a health professional development and career track.

c. Sector Development Approach for Health Implementation The establishment of effective donor and LGU coordination and harmonization of procedures shall be implemented at the local level.

d. Support to the LGU Scorecard Implementation The LGU Scorecard system shall be developed and piloted in convergence sites to assess LGU performance during the medium-term. The LGU Scorecard shall not be limited to benchmarking the progress of site development but may also serve as basis for incentives. Monitoring and evaluation tools shall be developed through a consultative, iterative and objective process. Qualitative and quantitative means of evaluation shall be utilized.

e. Local Health Information System Development and Utilization Local Health Information System shall be developed to provide accessible data for local health planning and policy development. This shall require harmonization of information systems of different stakeholders in the local health system, inclusion of information systems on human resource, vital registries and health statistics, disease surveillance, national and local health accounts, health regulations, and health facilities.

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2. LGU Internal Management a. Strengthening the Public Finance Management Advocacy and technical assistance for the improvement of Public Finance Management (PFM) among LGUs shall be done. This shall cover planning, budgeting, accounting, procurement, external and internal audit, performance monitoring and evaluation, and records management. The technical assistance shall mainly focus on improvement of PFM systems and procedures.

b. Strengthening Procurement and Logistics Management The municipal, city and provincial procurement and logistics management system needs to be strengthened. The reform initiatives shall improve the inventory system and a supply chain mechanism, efficient storage, database of goods and supplies with standard specifications, pooling, monitoring, and feedback mechanisms incorporated in the procurement systems, database of suppliers with performance monitoring, standardization of specifications and documents, and the implementation of ethical practices.

c. Asset Management The LGUs shall undertake a comprehensive and systematic process of effectively acquiring, maintaining, upgrading, operating and disposing its assets in the health facilities to maximize the utilization and worth of these assets.

d. Strengthening Internal Audit Advocacy and technical assistance in the establishment of internal audit system in LGUs as prescribed by the national government under Administrative Order No. 70 shall be pursued to improve their internal operations and performance. A functioning internal audit system will ensure that all resources are managed and utilized effectively in accordance with prescribed laws and regulations.

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Running the Health Reform Race: Operational

Framework for FOURmula ONE for Health

Functional Management Arrangements

To ensure its effective and efficient implementation, FOURmula ONE for Health (F1) shall adopt the following management approach:

Institutionalizing interagency steering committee

Designating implementation teams

Providing dedicated coordination teams

Integrating resource management and

Strengthening management of communications and advocacy. An effective and functional management infrastructure responsible for implementing various components of F1 as well as monitoring and evaluation of target outcomes and performance benchmarks will be put into effect.

Key units within the DOH shall be formally clustered and then designated to manage the implementation thrusts of F1. Within these units, there has to be a corps of dedicated staff that shall be tasked solely to perform functions attendant to the day-to-day operations of F1 implementation. All other offices in the organization shall focus their efforts to contribute towards achieving F1 objectives.

Management and implementation teams at all levels of the health system shall communicate and advocate the goals, objectives, strategies and activities of F1 to build a public constituency behind it.

At the national level, F1 management shall be organized into three (3) major clusters and their respective component teams:

Governance and Management Support

Sectoral Management and Coordination Team

Internal Management and Support Team

Policy and Standards Development and Technical Assistance

Policy and Standards Development Team for Regulation

Policy and Standards Development Team for Service Delivery

Policy and Standards Development Team for Financing

Field Implementation Management Office

Field Implementation Management Office for Luzon and National Capital Region

Field Implementation Management Office for Visayas and Mindanao

At the regional level, Regional Implementation and Coordination Teams shall be organized, consisting of the DOH-CHD, PhilHealth Regional Office, POPCOM Regional Office, National Nutrition Council Regional Office, all retained health facilities and other related agencies and organizations at the regional level.

At the local level, Local Implementation and Coordination Teams shall be organized. Existing Local Health Boards and Inter-Local Health Boards shall serve as the Local Implementation and Coordination Team, which may be expanded to secure wider participation from the community, civil society and the private sector.

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The relationship of the above teams to the National Steering Committee for Health, the attached agencies and special concerns and to the Office of the Secretary shall be defined as shown in the figure:

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AAArrrrrraaannngggeeemmmeeennntttsss fffooorrr FFF111 IIImmmpppllleeemmmeeennntttaaatttiiiooonnn

Secretary of Health Attached Agencies & Special

Concerns National Steering

Committee on Health

Sectoral Management & Coordination Team

Internal Management & Support Team

Policy and Standards

Development Team for

Regulation


Development Team for Service

Delivery


Development Team for Financing

Field Implementation

Management Office for Luzon

& NCR

Field Implementation

Management Office for Visayas &

Mindanao

Governance & Management Support

Field Implementation and Coordination

Regional Implementation

& Coordination Teams

Regional

Implementation

& Coordination

Local Reform Implementation

Team

Local Reform Implementation

Team

Policy & Standards Development & Technical Assistance

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Roles and Responsibilities

The Executive Committee (ExeCom) – provides policy directions for implementing FOURmula ONE for Health. The ExeCom is chaired by the Secretary of Health and is composed of all undersecretaries, assistant secretaries and selected Directors in the DOH.

Governance and Management Support Teams

There shall be two teams to assist and provide support to the Secretary of Health in the governance and management of F1. As such, these teams will operate directly under the Office of the Secretary.

a. The Sectoral Management and Coordination Team (SMC Team)

The SMC Team ensures that all four thrusts of F1 are effectively coordinated, synchronized, and properly monitored.

The SMC Team is responsible for the overall development, monitoring and coordination of policies, mechanisms and guidelines for the health sector, encompassing financing, regulation, service delivery and governance concerns as approved by the ExeCom. This includes concerns in rationalizing public subsidies in health and the management and implementation of the needed DOH budget reforms required in the course of implementation of F1.

The SMC Team will also coordinate and manage inputs to the Field Implementation and Coordination Teams from the other F1 management teams concerning policies, standards and technical assistance related to financing, service delivery, regulation, and good governance.

Furthermore, the SMC Team shall oversee the development of information and communication technology (ICT) requirements including building the information and communication technology infrastructure necessary for the F1 implementation.

b. The Internal Management Support Team (IMS Team)

The IMS Team is responsible for implementing DOH financial, procurement and logistics management reforms and other management support services. The IMS Team shall focus on the administration of the DOH’s finance and logistics management of F1 implementation.

As a special committee, the Central Office Bids and Awards Committee (COBAC), including the Procurement Division-PLS oversees the implementation of procurement management reforms.

The Policy and Standards Development and Technical Assistance Teams shall focus on the provision of technical guidance and policy support for implementation at the field level. A Policy and Standards Development Team for each major function will be assigned to develop policies and standards, and provide technical assistance to field level implementation in areas of regulation, service delivery, and financing.

The Policy and Standards Development Team for Health Regulation (PSD Team for Regulation)

The PSD Team for Regulation will exercise its mandate and function to ensure the quality and affordability of health products and services. This pertains to the development of policies, standards and guidelines, as well as technical capability for regulating health products, including drugs and medicines, and health facilities and services, in tandem with the accreditation and quality assurance systems of PhilHealth.

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The Policy and Standards Development Team for Health Service Delivery (PSD Team for Service Delivery)

The PSD Team for Service Delivery ensures the development of policies, standards and guidelines for health programs and the provision of technical assistance to health service providers. This includes the development of disease surveillance systems, program design for essential health packages and specialized health services, health promotion and advocacy, and upgrading of health facilities, among others.

The Policy and Standards Development Team for Health Financing (PSD Team for Financing)

The PSD Team for Financing will ensure that the NHIP is further strengthened by expanding social health insurance coverage, improving benefits and leveraging provider payments on quality of care.

The PSD Team for Financing will coordinate with the PSD Team for Regulation with regard to the harmonization of regulatory systems and processes.

The Field Implementation Management Office (FIMO)

FIMO will focus on the F1 implementation, management and coordination in their respective geographic assignments – one for Luzon and NCR and one for Visayas and Mindanao.

The FIMO Teams provide over-all coordination of the CHDs, PhilHealth Regional Offices (PRO), POPCOM Regional Offices, NNC Regional Offices and retained health facilities in their area. Each team will also initiate and maintain the development of the regional coordinating facility involving government health offices such as the DOH-CHD, PRO, and the POPCOM Regional Office, NNC Regional Office, other government agencies, NGOs, the private sector and other stakeholders at the regional level.

Its main goal is to oversee and coordinate the implementation of F1 in partnership with the LGUs, the private sector and other government agencies, in consonance with the principle that reforms implemented and operated in a decentralized manner brings results closer to the people.

The FIMO will deal with technical supervision and coordination of the implementation activities of F1 at the local level. Specifically, these tasks refer to FOUR-in-ONE Convergence Site development and institutionalization of LGU governance management structures.

As the lead in health reform implementation, the FIMO will promote and ensure the quality of the services provided for by the DOH retained hospitals in support of, and within, the context of local health system development.

Regional Implementation and Coordination Teams (RIC Teams)

The RIC Teams will carry out the following responsibilities: (1) provide technical assistance to define the package of minimum health care for the LGUs; (2) strengthen technical and managerial capability at the local level to improve LGU performance; (3) facilitate compliance to accreditation requirements of health facilities, products and services; (4) provide venues for inter-agency coordination, including other players in the health sector in a given locality; (5) monitor and evaluate the LGU performance through the LGU scorecard; (6) develop incentive mechanisms for LGUs towards better performance in the delivery of health care; and (7) rationalize the role of DOH hospitals to complement health care services provided by the LGUs and the private sector.

These teams are primarily responsible for the technical supervision and coordination of health reform implementation in the Four-in-One convergence sites. Part of the evaluation to be conducted by the regional teams is to determine the effective performance of the Four-in-One convergence sites, based on the LGU scorecard.

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Local Implementation and Coordination Teams (LIC Teams)

The LIC Teams are responsible for the over-all implementation of F1 activities in their respective local government units or Four-in-One Convergence sites.

Chaired by the Local Chief Executives (LCEs) or their duly designated representatives, the LIC Teams will ensure local health governance through the institutionalization of management structures consistent with F1 implementation.

Local Government Units (LGUs)

The LGUs shall ensure that the basic essential health service packages are being delivered to its constituents.

The LGUs shall organize themselves into Inter-Local Health Zones that will integrate the implementation of F1 reform strategies.

The LGUs shall enact the necessary legislative issuances (ordinances, resolutions, etc.) in support of F1 implementation at the local level.

They shall provide counterpart funds for implementing and sustaining their investment plan.

They shall promote and advocate for the implementation of F1 as the health sector reform implementation framework in their respective localities.

Civil Society

Civil society and other private sector partners are expected to assist the DOH and the LGUs in achieving desired health objectives.

Civil society will help point out people’s health needs, particularly those of the vulnerable groups and bring to the attention of the LCEs and/or LIC Teams such felt needs.

They will contribute towards enhancing the equity, accountability and transparency of F1 implementation at the Four-in-One Convergence sites.

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Pump-Priming Health Reform Implementation:

F1 Financing Mechanisms and Strategies

The financing of FOURmula ONE for Health or F1 implementation follows a two-pronged strategy:

1. The first one, described earlier in the section on financing, refers to the rational use of public subsidies, both national and local, and the increasing role of social health insurance in paying for the health services of Filipinos. This likewise requires aligning these resources to sustain the strategic thrusts and programs of F1.

2. The other strategy entails using available resources, mainly those from the foreign assistance pipeline to pump prime F1 implementation in the immediate term.

The financing portfolio for FOUR-in-One Convergence Sites consists of the following:

Grants will come from development agencies such as the European Union (EU), the German Technical Cooperation (GTZ) and the Government of Belgium among others.

LGU Counterpart will come from the respective Internal Revenue Allotments (IRA) and other revenue sources of the LGUs; or from loans that may be accessed from the Asian Development Bank (ADB) or the Kreditanstalt für Wiederaufbau (KfW) through the Municipal Finance Corporation (MFC), an attached agency of the Department of Finance, and other such development or commercial banks.

National Government Counterpart will come in the form of technical assistance, training and capability building, systems development support, logistics support or other non-cash assistance from the Department of Health. One source identified for the national Government counterpart is the World Bank (WB), in the form of a budget support loan.

Other Partners like the World Health Organization (WHO) and other United Nations-attached agencies, the United States Agency for International Development (USAID), the Japan International Cooperation Agency (JICA) and other funding agencies will also be tapped for technical assistance and support.

Given the diversity of funding sources and priorities, F1 will offer a rational menu of interventions to finance, organized in a way that individual donors can support, while reflecting their own priorities and preferences.

This menu provides a venue where various donors, the DOH, the LGUs and other agencies can dialogue and jointly answer how the full package of F1 implementation can be supported. The end goal of this dialogue shall be an optimal foreign assistance portfolio that:

Ensures that the full package of F1 implementation is fully supported;

Ensures that there is a balance between loans and grants, between funds for project preparation and funds for implementation in supporting targeted FOUR-in-ONE convergence sites;

Ensures that funds are applied in a timely manner, i.e. present and future support for F1 are made available over a longer planning horizon;

Ensures that funds are applied in a manner compatible with improving the capacities to manage the reforms, thus avoiding parallel funding agency operated agendas and management infrastructures; and

Any health project that will be developed in the future shall as much as possible be consistent with and brought into the F1 framework.

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Reaching the Finish Line: Setting New F1

Targets and Objectives

As previously emphasized, working on reforms for the health sector will never be

done in a single medium term. It is a long-term, dynamic and iterative process such that reaching the F1 finish line means starting on a new track all over again.

Components and strategies may be added, refocused or redirected as health reforms are implemented but the basic reform areas will remain.

It is the intention of F1 to put the building blocks in place now and trigger more reforms in the future.

All stakeholders for health are encouraged to join the race against fragmentation, inequity and ill-health to reach a brighter and healthier tomorrow for many generations of Filipinos to come.

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Administrative Order 2005-0023: Implementing Guidelines for FOURmula ONE for Health as Framework for Health Reforms, Department of Health, Philippines Administrative Order 2008-0005: Functional Arrangement for Managing Field Implementation in Support of Health Sector Reform Efforts Family Planning Survey 2006, National Statistics Office, Philippines. 2006

Field Health Service Information System 2004, National Epidemiology Center, Department of Health, Philippines. 2004

Filipino Report Card on Pro-Poor Services, World Bank, 2000

FOURmula ONE for Health Primer, Department of Health, 2005

National Demographic and Health Survey 1998, National Statistics Office (Philippines), Department of Health (Philippines), and Macro International Inc., Manila, Philippines. 1999

National Demographic and Health Survey 2003, National Statistics Office, Manila, Philippines, and ORC Macro, Calverton, Maryland. 2004

National Demographic Survey 1993, National Statistics Office (NSO), Manila, Philippines. 1994

National Objectives for Health 2005 to 2010, Department of Health, Philippines, 2005

Philippine Health Statistics 2004, National Epidemiology Center, Department of Health, Philippines. 2004

Philippine National Health Accounts 2005, National Statistical Coordination Board, Philippines, 2008

Philippine Statistical Survey 2007, National Statistical Coordination Board, Philippines, 2007

BIBLIOGRAPHY

overview of the philippine health system and the implementation framework for health reforms

Documents

health f1

health planning

health services

health goals

health outcomes

health sector reforms

health policy development

health reform race