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Evaluation report

2000 CBD: Introducing User Fees at Public Sector Health Facilities in Cambodia: An Overview (Briefing Paper)



Author: Health Economics Task Force, Ministry of Health

Executive summary

Background

The paper provides an overview of issues raised in connection to introducing user fees for services at public sector health facilities in Cambodia. Official charges were first established at a few referral hospitals and health centers in 1997 as part of the overall programme for health sector reform. The climate in which they were introduced indicated widespread poverty, a high disease burden among the population, impoverishing levels of health expenditures and a poor government infrastructure to deliver essential health and education services. Public health staff were poorly paid, leading to rent-seeking behaviour and unofficial payments. Within the health care market, consumers faced uncertainty not knowing how much to pay, when, and to whom payments should be made, in addition to what would be received in terms of quality and appropriateness.

Purpose / Objective

The present paper takes stock of the situation at hand regarding the current model of user fees in the public sector.

Methodology

A review of existing project documentation and relevant literature was conducted.

Key Findings and Conclusions

The Health Care Demand Survey (National Institute of Public Health /GTZ/ WHO, 1996) revealed that health expenditures constituted 22% of total household expenditures, the proportion being highest (28%) among the poorest quintile. Self-medication through purchase of drugs from largely unlicensed, untrained providers was the most common recourse for the majority of people (57%). Private providers were preferred for their qualifications, their prompt actions in attending to patients and having an adequate supply of medicines.

In this context, user fees were introduced to provide an alternative and supplementary mode of financing public sector services. The intention was to generate extra revenues and create a managed environment for improving service quality. This reform complemented the other major reform to extend a network of health facilities throughout the country, i.e. the Health Coverage Plan.

The primary purpose was to reduce unofficial fees, improve quality of care, and enable staff motivation with an aim to lower household health expenditures and improve access to priority public health services for the majority of the population. The main bulk of revenues, i.e. 99% were kept on location, and channeled back into operational costs and staff incentives. Internal regulatory systems were created at health facilities to ensure quality and improve managerial capacity. Linkages with the community were established in the form of feedback committees and hospital/health center management committees to promote participation and joint discussions on customer needs and preferences.

The outcomes include both success stories as well as unsuccessful ones. The government is in the process of documenting whether user fees have contributed positively or negatively to the Cambodian health system. The indirect gains in organizational development and internal regulatory systems include team building, where different committees meet to monitor activity, rates, revenues, exemptions granted and go through problem solving exercises to develop strategies that generate high revenues. Staff members plan for efficiency by monitoring expenditures, and initiate self-regulatory procedures to maintain standards for the facility as a whole. Overall, health finance schemes have given the opportunity to bring in positive outcomes in management development at service facilities that may outweigh their benefits in generating finances.

In broad terms, the merits of establishing user fees have been an opportunity to raise some income for a small portion of the recurrent costs, enable staff motivation and commitment, and facilitate organisation development through team building and improvement of management skills.

User fee schemes have also enabled health facility management to build linkages with the community. Community representatives have played an important role in some health financing schemes, especially at health centre level where their input is the most visible. In some health centres, charging and fee levels have been discussed with co-management committees and Feedback Committees. Where those committees exist, discussion on financial matters in monthly meetings helps to improve transparency in the management of generated income. Committee members also promote and explain the health financing scheme objectives and practices to the population. At hospital level, such as with Svay Rieng Provincial Hospital, there is a growing awareness for community-based structures such as Feedback Committees and Village Development Committees to participate in the implementation of exemption schemes. The feasibility of exemptions to be decided at village level, where the status of the person could be directly observed, is being explored. The idea is taking shape slowly and cautiously because it is quite complicated to implement, and calls for good understanding of all partners. Community participation also provides opportunities for increasing health service quality as it provides a channel for obtaining information from customers. Feedback Committees have also helped in conducting health promotion activities in the community.

A word of caution needs to be inserted in discussing demerits. Facilities with user fees may have encountered lower utilisation rates, and there is no evidence as to whether they have or have not created higher expenditures for consumers. However, it should be reminded that user fees might not have been the causal element but rather the lack of organisational readiness and management skills to implement and regulate the systems effectively. It would be important to examine what would be required to enable public health staff operating within the current organisational climate to implement user fee schemes successfully, according to guidelines and principles established. Another concern is the potential conflict of interest of staff at public health facilities operating private practices who are reluctant to fulfill the required number of work hours and keep price levels low to attract customers. Their commitment to service delivery at the public facility and team goals within the institutional setting is critical to the success of health finance schemes. Management supervision to render a clear separation of roles and responsibilities is necessary to enable this.

The support of the Ministry of Health, the civil authorities and the Provincial Health Department played a critical role in the success of the schemes. The assistance of these partners affected many inputs such as sufficient supply of drugs, medical supplies and equipment, adequate access to budgetary support and technical advice on management and clinical tasks. As the public health system becomes more decentralised, there is a growing role for the provincial health department in monitoring, supervision and support for facilities with health finance schemes. The different schemes implemented within the past two years have yielded many lessons. Across the board, the rubric of best practices include on-site management and technical advice, adequate incentives to staff, external financial support, concrete strategies for the improvement of service quality including clinical skills, and last but not the least, internal management regulations that enable performance at optimal levels.

Other issues that have emerged in the process of learning from existing models include the following:
- That user fees cannot exist as the sole means to finance a health service delivery system as even the most successful schemes are not fully self-sustainable
- Cost recovery will be limited when public health goals are to be achieved
- An efficient service delivery system will reduce the need for higher fees and enable lower prices without compromising quality
- Price levels, and a host of other factors such as poor service quality, lack of courtesy in staff behaviour, clients' perceptions of quality and the inadequacy of medicines can affect access, especially of the poor, to priority health services.

Recommendations

The Ministry of Health is at the crossroads of reform where clear and reliable evidence is needed to develop financing policies that promote access and equity, and enable poverty alleviation. The next logical and essential step is to conduct an in-depth analysis of how user fees have affected access, equity and health service delivery.

A series of monitoring, evaluation and operations research activities are envisaged for the purpose of developing a best practice package. The current plans include institutionalisation of a reporting system that requires facilities with user fee schemes to provide information on utilisation, exemptions, revenues, expenditures and the distribution of salary supplements on a quarterly basis. At later stages, the monitoring system will provide the means to construct an evidence-base for policy and training in effective management of health finance schemes at both central and peripheral levels. The Ministry of Health and its development partners stress the importance of an in-depth evaluation in a sound and comprehensive manner.



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Report information

Date:
2000

Region:
EAPRO

Country:
Cambodia

Type:
Evaluation

Theme:
Health - Managment

Partners:
WHO

PIDB:
YH202

Follow Up:

Language:
English

Sequence Number:
2000/008

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