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Universal social protection in health: The financial reform in Mexico. Julio Frenk, M.D., Ph.D. Minister of Health of Mexico. April 20, 2004. Outline. The health policy framework in Mexico The challenge of financial protection Towards fair financing of health care.
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Universal social protection in health: The financial reform in Mexico Julio Frenk, M.D., Ph.D. Minister of Health of Mexico April 20, 2004
Outline The health policy framework in Mexico The challenge of financial protection Towards fair financing of health care
The Pillars of Public Policies Public Policies Political Technical Ethical Information and Evidence
Health System Goals Health Responsiveness Fairness in financing Level • . • . Quality Distribution • . • . • . Equity Efficiency
Challenges of the Mexican Health System The National Health Program 2001-2006 uses the WHO framework for prospective policy formulation. On the basis of evidence gathered from several sources, three basic challenges, related to the health system goals, were identified:1. Equity 2. Quality 3.Financial protection
National Health Program 2001-2006 The Democratization of Health in MexicoTowards a Universal Health System
Logic of the NHP CHALLENGES GOALS STRATEGIES ACTIONS Reduce health inequalitiesImprove health conditionsImprove the responsiveness of the systemEnsure fair financing for health Equity QualityFinancial protection • Technical 5 subtantivestrategies 35 • Interper- • sonal Strengthen thehealth system 31 5 instrumentalstrategies
Examples of Successful Programs Synergies among income transfers, nutrition supplementation, education, and health: “Opportunities” Program The new frontier for universal coverage: “Fair Start in Life” Quality for all: “National Crusade for Quality in Health Care” Universal social protection: “Popular Health Insurance”
Outline The health policy framework in Mexico The challenge of financial protection Towards fair financing of health care
Financial Protection Problem Almost half of Mexican households lack health insurance, which limits access to care, reduces opportunities for risk pooling, and generates catastrophic expenditures.
Financial Protection • Evidence • National Health Accounts (FUNSALUD, 1994) • World Health Report 2000. Health Systems: Improving Performance • National Household Income and Expenditure Surveys (1992-2002) • World Health Survey (WHO-NIPH, 2002-2003)
Financial Imbalances 1.Level: insufficient investment (5.8% of GDP) 2.Source: predominance of out-of-pocket payments (55%) 3.Distribution 3.1. Among populations: 1.5 times between insured and uninsured 3.2. Among states: 8 to 1 between the state with the highest and the lowest per capita federal expenditure 4.State contributions:119 to 1 between the highest and the lowest 5.Allocation of funds:increasing proportion to payroll at the expense of investment
Financial Imbalances Insufficient investment Health expenditure as percentage of GDP 16 13.9 14 12 10.9 Latin American Average 10 9.3 $ 36,948 million dollars $ 356 dollars per capita Percentage 8 7.2 6.9 5.8 6 5.3 4 2 0 México Bolivia EUA Uruguay Colombia Costa Rica
Financial Imbalances The source of finance State 7% Social Security 61% Federal 32% Private insurance 3% 3% Public expenditure 42% Out-of-pocket 55%
Financial Imbalances: Impoverishment due to health care expenditure 2 million: Catastrophic expeditures (more than 30% of disposable income) 1.5 million families .5 million families 1.8 million families 2.3 million: Impoverishing expenditures (“medical indigency”)
Outline The health policy framework in Mexico The challenge of financial protection Towards fair financing of health care
Financial Reform: The Vision 1943 Social security Assistance Formal workers, urban Poor, informal, rural Universal socialprotection for health 2003
Organization by functions Current situation: SOCIAL GROUPS Insured Uninsured Functions Poor Urban/Rural Middle class Stewardship Financing Delivery Federal and State Ministries of Health/ IMSS Oportunidades Private sector IMSS/ ISSSTE
Organization by functions Vision for the future: SOCIAL GROUPS Uninsured Insured Functions Poor Middle Class Ministry of Health Stewardship Financing Universal Financial Protection Delivery Integrated Model of Health Provision
Financial Reform: Ethical Basis Principles Key concept Values Social inclusion Universality National portability Equal opportunity Explicit prioritization Democratizationof Health Financial justice Free at point of delivery Financial solidarity Corresponsibility Subsidiarity Democratic budgeting Autonomy Accountability
Financial reform: • To order current budget allocation • To correct financial imbalances and the historical inertia • To move toward a public insurance logic for medical care • To establish corresponsability • among goverment levels • with the citizens • To allow the effective exercise of social rights
Toward a new financial arquitecture for health Health goods Resources Stewarship Federal MOH Budget State Public goods Contributory fund for CHS Community health services Essential services Contributory fund for PHS Personal services (Popular health insurance) High specialty interventions Fund for Protection against Catastrophic Expenditures
New structure for universal financial protection Contributions Public Insurance Scheme Co-responsible contributor Federal Goverment Beneficiary IMSS (private-sector, salaried employees in the private sector) Private employer Social Contribution Employee ISSSTE (salaried employees in the public sector) Social Contribution Employee Federal employer Popular Health Insurance (non salaried workers, self employees and families outside of the labor force) Solidarity contribution Social Contribution Family State- level Gover-ment Federal Goverment
Financial Reform: Innovations Universal health insurance Social protection system for health Inves-ment Plan Budge-tary priority to public health Affiliation with explicit rights for all Protection against catastro-phic expenses Demo-cratic budge-ting
Financial Reform: Benefits Less inequality among states 14,000 12,000 10,000 8,000 Pesos per family 6,000 4,000 2,000 NL Jal DF BC Sin Col Ver Gto Qro Gro Zac Ags Tab Yuc Mor Son Nay Pue Dgo Hgo Oax Tlax Mex SLP Chis Chih BCS Mich Qroo Coah Camp Tamps Additional resources Health care expenditureper familyby state Without reform
Financial Reform: Benefits Progressivity % 19.6% 20 15 Millions of pesos (Percentage) 10 5 2.1% I II III IV V VI VII VIII IX X Income
Social protection in health for all 2004-2010 2010 2009 2008 2007 2006 2005 High specialty interventions Benefits 2004 Essential health services Prevention Plan Plan de Prevención Community health services I II III IV V VI VII VIII IX X Income Beneficiaries – Uninsured population
“Change means providing financial protection in health for all, so that ... every Mexican familiy is covered by basic health insurance” Vicente Fox President of Mexico Inauguration Message December 1, 2000