Innovative EU Support to Health Financing Reforms

1. Innovative EU Support to Health Financing Reforms Dr. Christopher Knauth, MCommH Health Sector, Southern and Eastern Africa Unit Development and Cooperation – EuropeAid European Commission

2. Introduction The health systems of the European Union are a central part of Europe's high levels of social protection, and contribute to social cohesion and social justice as well as to sustainable development. The overarching values of universality, access to good quality care, equity, and solidarity have been widely accepted in the work of the different EU institutions. Together they constitute a set of values that are shared across Europe. Council 2006, Council Conclusions on Common values and principles in EU Health Systems 2733rd EMPLOYMENT, SOCIAL POLICY, HEALTH and CONSUMER AFFAIRS Council meeting

3. Introduction EU partnership and dialogue with third countries will promote common values of: respect for human rights, fundamental freedoms, peace, democracy, good governance, gender equality, the rule of law, solidarity and justice. The European Consensus on Development, European Council 15-16 Dec 2005, signed by Presidents Barroso, Borrell, Blair 20 Dec 2005

4. Overview • Health Co-operation Policies 2000-10 on fair financing • Experience of EC support in MIC • New Development Policy 2011 • Opportunities and Perspectives

5. 1. EC Health Co-operation Policies on Fair Financing 2000-10

6. WHR 2000 : Health System goals • Improving health, reducing inequalities • Enhancing the responsiveness to the legitimate expectations of the population • Assuring fairness of the financial contribution

7. 2002 : COMMUNICATION Health and Poverty Reduction in Developing Countries • to improve health, AIDS and population outcomes • to maximise health benefits and minimise potential negative health effects of EC support for other sectors; • to protect the most vulnerable from poverty through support for equitable and fair health financing mechanisms; and • to invest in the development of specific global public goods.

8. 2002 : COMMUNICATION Health and Poverty Reduction in Developing Countries The expansion of social protection, including fair and equitable financing mechanisms should remove barriers, encourage use of services by the poor and protect them from the risks of impoverishment due to health expenditure.

9. 2010: COMMUNICATION The EU role in Global Health • The EU should support third countries efforts to formulate effective policies to mobilise domestic revenues, scale up fair financing of health systems and develop or strengthen social protection mechanisms in the health sector. • In Developing Countries, replacing of user fees with fair financing mechanisms and compliance with commitments on national budgets' allocation to health should be considered.

10. 2. Experiences of EC support in MIC Philippines 2007-2010

12. “FOUR(4!)mula 1” • Health Financing • Health Regulation • Service Delivery • Sector Governance

13. 1.Health Financing • Mobilising resources from extra budgetary resources • Coordination local and national health spending • Adopting a performance-base financing system • Expanding the national health insurance program

14. EC Sector Budget Support • € - > Minister ofFinance • Sectorpolicydialoge • TA

15. EC Support HSPSP: 33 Mio EUR • In average: Fixed tranche 79%, variable tranche 21% • ECTA

16. EC Support Health Financing • ECTA to PhilHealth • Draftingof a HealthFinancingStartegyforthe Philippines • Variable tranche – extensionofinsurancecoveragetothepoor

17. HEALTH CARE FINANCING STRATEGY 2008-2017 Working paper

18. Large Income-Related Health Outcome Inequalities

19. Financial Protection is Getting Worse OOP Share of Total Health Spending is Increasing While the Public Share is Decreasing This is Counter to the Trend in Neighboring Countries

21. 2. New Development Policy 2011 Increasing the impact of EU Development Policy- An Agenda for Change –

22. A fast changing international context • Graduation: increased standards of living, 25 countries recently moved from category (LICs to LMICs or from LMICs to UMICs) • New actors : private sector, private foundations, emerging donors, local authorities; • Population growth :world population to reach 9.3bn by 2050; Africa fastest-growing continent • 3 global crises: food prices, oil/energy prices volatility, economic and financial crisis • Economic downturn & budget constraints • ‘Arab spring’:importance of good governance and democracy, employment and growth, security-development nexus brought into sharper focus • Regional vulnerabilities & crises: Horn of Africa (drought/famine) • Strong growth but weak effect on poverty reduction – ref African Economic Outlook Report: 2001-09: 5-6% real GDP /slowdown 2009 3.1%– rebound - projection 5.8% in 2012

23. Increasing EU impact • World’s largest donor • Key trading partner • Broad and ambitious development policies • Comprehensive partnerships The EU is already making a significant contribution towards the MDGs … … but we could have even greater impact.

24. Fall/ Winter 2010 Cosultation on Issues Paper • Inclusive growth • Sectoral Concentration • Focus on growth related sectors: trade, agriculture, private sector devnopment • Focus on LICs

25. Key results from the public consultation • +240 written responsesfrom wide range of stakeholders, both from the EU and partner countries • Convergence of views from all stakeholders on: • retaining the poverty focus of EU development policy; implementing EU commitments (ODA targets, aid effectiveness, PCD) • Importance of inclusive growth for poverty reduction, alongside other interventions in the fields of governance, health, education, etc.. • Desirability of a differentiated approach to partner countries • Importance of capturing and communicating results to secure political and public support for development • Important role played by the EU in good governance (including participation of civil society), security, human rights and gender equality • Central role partner countries have to play in helping their own development + importance of partner country ownership • Encourage private sector engagement, but certain norms and standards (e.g. decent work) must be respected. • All contributions + report on the public consultation are online (Commission website)

26. Communication 'Increasing the impact of EU Development Policy: an Agenda for Change' COM(2011) 637 final of 13.10.2011

27. “An Agenda for change” • More strategic and more focused portfolio in support of good governance and inclusive and sustainable growth; • Greater sectoral concentration at country level; • Enhanced importance to human rights, democracy and good governance; • Continued support for social inclusion and human development; • Greater focus on investing in drivers for growth and job creation;

28. Policy priorities • Good governance, democracy, humanrights • Sectors building foundations for inclusive growth (e.g. social protection, health & education) • Drivers forgrowth and job creation (e.g. business environment, regionalintegration) • Sectorswithstrong multiplier impact and contributing to environmental protection + climate change prevention/adaptation : sustainableagriculture and efficient renewableenergy

29. Social protection, health, education • More comprehensiveapproach to humandevelopment • ‘sectorreformcontracts’ to increaseequitableaccess to qualityhealth and education services • Promotepolicycoherence and increase protection against global healththreats • Support decentwork agenda, social protection schemes, and regional labour mobility. • ‘continued support for social inclusion and humandevelopmentthroughat least 20%

30. In preparation : New Communication on SocialProtection The Communication on Social Protection will seek to explain the role of social protection in underpinning inclusive and sustainable development and the role of EU development cooperation in supporting the strengthening of social protection policies and systems

31. 4. Conclusions, Opportunities, Perspectives

32. 4.Opportunities and Perspectives • EC :Learning form South Africa • EC :Lessfocus, lessmoney on MIC • Lessmoney, perhapsbetterfocussed TC • More comprehensiveapproachtowardshealthandsocialprotection • EC supporting WHO Action Plan