11

MINISTRY OF HEALTH MALAYSIAA PRESENTATION TO

THE CONFERENCE ON THE NINTH MALAYSIA PLAN15-17 FEBRUARY 2005

PROPOSED NATIONAL HEALTH CARE PROPOSED NATIONAL HEALTH CARE FINANCING MECHANISMFINANCING MECHANISM

BY

DATUK DR. HJ MOHD ISMAIL MERICANDEPUTY DIRECTOR-GENERAL OF HEALTH

(RESEARCH & TECHNICAL SUPPORT)MINISTRY OF HEALTH MALAYSIA

22

OVERVIEWObjective of the presentationWhy we need a change?What we have done so far?Malaysian National Health AccountsHealth care financing model

The preferred choice for MalaysiaThe next step

Implementation plan

33

OBJECTIVE OF THE PRESENTATIONOBJECTIVE OF THE PRESENTATION

THE NEXT STEP

To inform participants on the proposed national health care

financing mechanism: principles & its current status

44

WHY DO WE NEED A CHANGE?

Current scenario

Future goal

MOH’s PROPOSALGAPSGAPS

55

WHY DO WE NEED A CHANGE?

Reduce “gaps” in the present healthcare delivery system

e.g. equity, accessibility, quality of services, lack of integration & long waiting time at government health facilities.

Ensure that all Malaysians continue to receive appropriate health care of good quality at affordable prices.

66

CURRENT SCENARIO-1

1. Highly subsidized services & overdependence on government health facilities (including those who can afford)+ heavy workload + long waiting time

2. Inadequate integration in health, especially between public & private sectors+ “brain drain” to private sector+ private sector concentrates in urban areas+ inequitable distribution of resources and services

77

CURRENT SCENARIO-2

3. Rising demand & expectations for high tech & quality medical care

4. Inability to better regulate private health care providers

5.Changing demographic & epidemiological patterns

Increase in the ageing populationIncrease in chronic diseases

88

CURRENT SCENARIO-3

6. Increasing healthcare costs+ greater inequity & public outcry if not controlled+ access to private health services is mainly for

those who can afford+ increasing trend of private health expenditure

(esp. out-of-pocket expenditure – financial risk upon unexpected health events)

+ ‘supplier-induced demand’ - inappropriate services / medication

Operating and Development Expenditure, MOH 1990-2003

-

1,000.0

2,000.0

3,000.0

4,000.0

5,000.0

6,000.0

7,000.0

8,000.0

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003

Year

RM

Mill

ion Operating

Development

Total

Note: Using Current Prices

Source: Finance Division, MOH

1010

PER CAPITA ALLOCATION FORMOH: 1998 -2003

191 19

9 212 24

8 257 30

2

0

50

100

150

200

250

300

350Allocation per capita (R

M)

1998 1999 2000 2001 2002 2003YearsNote: Using Current Prices

Source: Finance Division, MOH

1111

CURRENT SCENARIO-4

7.7. Challenges of globalization & liberalization:

cross border flow (human, life-stock, etc)transmission of diseases

more foreign workers utilizing subsidized serviceshealth insurance coverage not mandated currently

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MALAYSIAN NATIONAL HEATLH ACCOUNTS Definition & Chronology

A tool which describes the expenditure flows of both public & private within the health sector of a country, inclusive of the sources, uses & channels for all funds utilized in the whole health system

Time frame of the project: 2001-2005Approved by NDPC (chaired by KSN)Supported by EPUFunded by UNDPFuture plan: institutionalize in P&D of MOH

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MALAYSIAN NATIONAL HEATLH ACCOUNTS … preliminary results...

Total health expenditure @ 1997-2002:ranges from 2.2%-3.1% of GDP(total health expenditure for 2002: 3.1% of GDP)

Government health expenditure @ 1997-2002:ranges from 51.0%-63.7% of total health expenditure

Private health expenditure @ 1997-2002:ranges from 36.3%-49.0% of total health expenditure

GOVERNMENT SPENDING ON HEALTH IS MORE THAN PRIVATE SPENDING

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NATIONAL HEALTH FINANCING: MAIN OBJECTIVES

NHCF

Enhanceefficiency & quality

Greaterintegration in

Health:10 , 20 , 30

Public / private

Better regulationof health

care providers

Mobilize Resources“Risk sharing” &pooling of resources(Community rated NHI System) & manage rateof healthspending

Achieve greaterequity & accessibility

Enhance national integration, social solidarity and caring society

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PROPOSAL OF THE MOH

Introduction of a National Introduction of a National Health Financing Mechanism & Health Financing Mechanism &

restructuring of MOH hospitals & clinicsrestructuring of MOH hospitals & clinics

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PRINCIPLES OF HEALTH CARE FINANCING MECHANISM :

Superior than the existing systemSingle national health care financing system with single fund managerContribution

Mandatory- those who can afford to pay must payGovernment assistance - the poor, disabled, elderly, civil servants (& dependants + pensioners)

Viable & sustainableViable & sustainableIn line with: In line with:

National integrity, national solidarity & a caring society Vision 2020

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NATIONAL INTEGRITY& NATIONAL SOLIDARITY

APRIL 2004

NATIONAL HEALTH FINANCING MECHANISM: MUST BENEFIT ALL STAKEHOLDERS

CONSUMERS

- Better quality of care

- Increase accessibility

- Better financial risk managementin ill health

HEALTH CAREPROVIDERS

- Better Incentives to cover rural population

- Greater opportunities

- Improvement in reimbursement system

- Increase efficiency- Better utilisation

of new health technologies

GOVERNMENT

Greater integration,efficiency,quality &equity.

- Optimal resourceutilization

- Focus on preventive & promotive programmes, regulation

EMPLOYERS

- Standardizedcontribution

- Healthy workforce

- Cohesive &stable society

Do Do NOTNOT change the present system if these goals are not metchange the present system if these goals are not met

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CAN WE STAY AS WE ARE?

Improvement or consolidation of the present system alone, will NOT be able to successfully achieve the desired objectives & benefits

2020

METHODOLOGYMETHODOLOGY

Review Review of various of various

relatedrelateddocumentsdocuments

Other Other Countries’Countries’

experiencesexperiences

Meetings / Meetings / forums / seminarsforums / seminars

involvinginvolvingstakeholdersstakeholders

in healthin health

PREPARATION OF THE NATIONAL HEALTH CARE FINANCING MECHANISM

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FEEDBACK FROM PROFESSIONAL ORGANISATIONS & NGOs

CAPCAPFOMCAFOMCAMMA MMA APHMAPHMPCDOMPCDOMCHICHIPDPKAPDPKAMTUCMTUCPhAMAPhAMAAMMAMMetc

Support National Health Support National Health Insurance Insurance Support NHFA Support NHFA

to govern health fundnnot to be privatisedot to be privatised

etc

2222

ORG. ACTIONS NEEDED / DECISIONDATES

NATIONAL HEALTH CARE FINANCING MECHANISM: -Chronology of events since MTR 4 MP (Early 1980s)

8.8.2000 EPU REACTIVATE THE DISCUSSION ON NHCF MECHANISM

30.11.2001 EPU - MEETING CHAIRED BY DG OF EPU ON NHCF27.03.2002 EPU - FOLLOW-UP MEETING WITH EPU :

TO PRESENT TO NDPC

13.06.2002 NDPC MOH TO PREPARE MEMOPRANDUM - TO CABINET

25.10.2002 YAB PM TO SEEK VIEWS OF PM; YAB PM SUPPORRTS NHI; NEED FURTHER DELIBRATION; MEMORANDUM CABINET

21.5.2003 MOF TO OBTAIN INPUT: TREASURY SUPPORTS NHCF

03.09.2003 CABINET AGREES IN PRINCIPLE, BUT IN VIEW OF IMPLICATIONSMEMBERS REQUEST SPECIAL SESSION

07.05.2004 YB HEALTH AGREES IN PRINCIPLES; SUPPORT NHI; WILL GET DATEMINISTER FOR PRESENTATION TO YAB PM

13.09.2004 NEAC MEETING ON SOCIAL SECURITY & PENSION REFORM(MTEN) CHAIRED BY YB DATO’ ,MUSTAPHA MOHAMED

02.11.2004 YAB AGREES WITH NHI; NHFA NOT TO BE PRIVATISED;PM NEEDS CONSULTANTS FOR IMPLEMENTATION

2323

NATIONAL HEALTHCARE FINANCING MECHANISM:

- THE SCOPE / SPECTRUM

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NATIONAL HEALTHCARE FINANCING MECHANISM

FFUUTTUURREE

HHEEAALLTTHH

SSYYSSTTEEM

Monitoring, Evaluation, Regulation & Enforcement

SOURCESOF

FINANCING

e.g. NationalHealth Insurance

NATIONALHEALTH

FUND

GOVERNANCEi.e INTER-MEDIARY

BODY(NHFA)

PROVIDERPAYMENT

MECHANISMHEALTHCARE DELIVERY SYSTEM

PATIENTS /CONSUMERS

MANDATORYCONTRIBUTION**

quantum &ceiling

ofcontribution

(**Health improvement contribution)

ESSENTIALHEALTHCARE BENEFITSPACKAGES

M

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NATIONAL HEALTH INSURANCE IS THE PREFERED CHOICE FOR MALAYSIA

a) Community-rated National Health Insurance (NHI)

- premium to be paid by those who can afford to pay, plus

b) Government Consolidated Revenue

- for the poor, disabled, elderly, civil servants (& dependants

+ pensioners)

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NATIONAL HEALTH INSURANCE -1

DEFINITION:-- ExpenditureExpenditure for for unpredictableunpredictable episodesepisodes are are

financed in advancefinanced in advance by by regularregular premiums, premiums, managed by a Government / Govt.managed by a Government / Govt.--appointed appointed authority (regulated by Govt.) toauthority (regulated by Govt.) to “cover” the “cover” the whole populationwhole population

-- Originated from Germany Originated from Germany (1893)-- Implemented in:Implemented in:

-- Europe: Europe: Germany, Belgium, France, Netherlands, etc

-- Latin America: Latin America: Chile, Argentina, Brazil, etc

-- Asia: Asia: Japan, Taiwan, Thailand, Korea, etc

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NATIONAL HEALTH INSURANCE-2

PARAMETERS PARAMETERS NATIONAL HEALTH INSURANCENATIONAL HEALTH INSURANCE

Contribution

Premium

Sharing of risk

Pooling of fund

Mandatory for those who can afford(employee, employer & self-employed)Government ( the poor, handicapped, elderly, civil servants & dependants, pensioners)

Community-rated(according to ability to pay & not risk-rated )Cap on income (e.g: 3%-4% of monthly income with a cap of RM 10,000)

Yes

Yes

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THE GOVERNANCE OF THE NATIONAL HEALTH FUND

NATIONAL HEALTH FINANCING AUTHORITY (NHFA)NATIONAL HEALTH FINANCING AUTHORITY (NHFA)

Owned by government, accountable to MOHSingle payerNot-for-profitNot to be privatisedStatutory BodyFunctions:

1. Policy, research & corporate health planning2. Health benefit packages & scope3. Assessment of health facilities & health providers - quality, efficiency, etc4. ICT planning & applications5. Health care financing data & analysis6. Fund collection & disbursement7. Strategic human resource planning & training

2929

ESSENTIAL HEALTH CARE BENEFITS PACKAGES

ESSENTIAL HEALTH CARE ESSENTIAL HEALTH CARE BENEFITS PACKAGEBENEFITS PACKAGESS-- must be in line with wellness paradigmmust be in line with wellness paradigm-- covers covers selected selected preventive, primary preventive, primary

andand hospital care serviceshospital care services-- obtainable from public & private obtainable from public & private

sectors (at sectors (at revised revised pricepricess)

SOURCE:NATIONALHEALTH

INSURANCE

OTHER SOURCES

)

OPTIONAL CARE PACKAGEOPTIONAL CARE PACKAGESS-- voluntaryvoluntary-- for optional coverage not coveredfor optional coverage not covered

in the essential health care packagesin the essential health care packages-- obtainable from public & private sectorsobtainable from public & private sectors

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RESTRUCTURING OF THEMOH HOSPITALS & CLINICS

(i.e. Health Care Delivery System)

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BENEFITS OF RESTRUCTURINGTHE MOH HOSPITALS & CLINICS

(MOH Health Care Delivery System)

Greater efficiency & competitiveness

Greater autonomy & flexibility in management &resource utilization

Flexible employment terms, better remuneration & working benefits

Promotion of professional competition & efficiency- reduction of “brain drain”

Decentralized management, yet integrated

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NEW ROLE OF MOH

Governmentshould

continueprovidingbudget toMOH for:

* * Regulatory, enforcement, policy formulation & monitoring to ensure quality, equity & accessibility

* Essential health care benefits packages for the poor, disabled, elderly, civil servants(& dependants + pensioners )

* Public health services (population health), research, training & development of new MOH facilities

3333

ROLE OF PRIVATE SECTOR, EPF & SOCSO

Complement the national Complement the national health financing mechanismhealth financing mechanism

this will be further deliberated this will be further deliberated in futurein future

3434

1. Consultant is needed to identify: - Financial implication to government- Appropriate level of contribution & means test- Benefit packages- Provider payment mechanism- Legal implications

2. Adopt an incremental approach- In phases (e.g. start with formal employment sector, in-patient

care etc.)- Social marketing

3. Review existing laws & formulate new ones

4. Establish the NHFA

5. Expedite & facilitate related functions of MOH which would have an impact on:

- Restructuring of the MOH hospitals & clinics

THE NEXT STEP

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CONCLUSION- PROPOSED HEALTH CARE SYSTEM

GovernmentConsolidated Revenue MOHMOH New New

role role of of MOHMOH

REDUCE

GAPS

MANDATORY

VOLUNTARY

NationalHealth Fund

Savings,Out-of-pocket,Private Insurance

NHFA

ESSENTIALHEALTH BENEFITPACKAGES

RESTRUCTU-RED MOHHOSPITALS & CLINICS

PRIVATESECTOR

PremiumEmployee Employer,

Self-employed,Foreign-workers

(Those who can afford)

EXTRACOVERAGE /ADDED VALUE PACKAGES

3636

Centella Asiatica