Mapping African Budgets to NHA Classification: Contributing to NHA Institutionalization

1. Mapping African Budgets to NHA Classification: Contributing to NHA Institutionalization Marcia D. Occomy, MA Health Systems 20/20 Project September 8, 2008 CESAG NHA Training Workshop Dakar, Senegal

2. Introduction • The work on NHA mapping in African Countries is by the NHA team of Health Systems 20/20 Project • The Africa Bureau of USAID financed the work • Marcia D. Occomy is the team leader for the HS 20/20 staff who produced the NHA mapping guide (Stephanie Boulenger, Susna De, Takondwa Mwase, Charles Waza) • Marcia D. Occomy has experience working with the US Federal government Budget office (7 years) and has served as an international public finance advisor to developing countries for USAID Projects (Central Asia, Central Europe, Middle East, Northern Africa) and has served as an adviser on the Health Systems 20/20 Project for 2 years

3. Presentation Overview • NHA process • What is mapping and why is it done during the NHA activity? • A five-step approach to mapping health budgets to NHA classification • Case Studies • Malawi • Zimbabwe

4. NHA Process • National Health Accounts (NHA) estimates total expenditures at the point of final consumption • National Health Accounts is conducted to determine how much a country has spent on health, for what purpose and by whom • A NHA activity creates a set of tables that show flow of resources through a health system from Financing Sources (FS) to Financing Agents (FA) to Health Providers (HP) and Functions (HC) • To date, health accounts have been implemented in more than 100 countries, including 28 African countries • 16 African countries have conducted NHA analysis more than once

5. NHA Process • Generating NHA tables involves: • Organizing the NHA team and developing a preliminary sketch of the national health care financing system • Identifying and collecting the health financing data* • Analyzing the data for gaps and then cleaning the data* • Populating NHA tables with spending estimates for at least four health care financing dimensions (FS, HF, HP, HC) • Analyzing the information for policy purposes and disseminating the information *Stages for NHA mapping

6. NHA Mapping • What is NHA mapping and why is it done during the NHA activity? • Government health budgets are often structured in a way that does not directly correspond with NHA categories • Mapping the government’s executed health budget means creating a crosswalk table between the budget line items and the corresponding NHA categories • Mapping… • Links the government’s health budget to the NHA framework • Enables the government to generate NHA tables more quickly and effectively and produce consistent NHA tables from year to year

7. NHA Mapping Key points about government executed health budgets: • Government budgets mapped to NHA classification are primarily of the Ministry of Health (financing agent) but can also be from Defense, Education, other ministries • Executed budgets reflect actual expenditures on health, not commitments or planned spending • Executed health budgets also show spending of funds transferred from financing sources primarily the Ministry of Finance and donors • Budget categories (e.g., function, administrative, program, resource) show type of spending and by whom

8. Five Step Approach • Five steps for mapping national health budgets to NHA classification: • First, identify and collect sources of information on government health expenditures • Second, review the national health budget to understand the budget categories used for health expenditures • Third, assign each budget line item representing public health expenditures to a NHA code for financing sources, then financing agents, provider and function • Fourth, if a budget line item does not directly correspond with a NHA code, develop apportioning rules to allocate the total expenditure figures for the line items across NHA codes for financing sources, providers and functions • Fifth, after completing steps 1-4, produce a multidimensional crosswalk table to document the mapping process and to populate NHA tables

9. Getting Started • Appoint a designated person from the NHA team • Have the NHA classification code tables for FS, HF, HP and HC available • Use an electronic spreadsheet of the detailed line item expenditure figures from the MoF/MoH for the mapping and analysis • Produce the Excel table for mapping by copying and pasting the expenditure figures from the MoF/MoH into a blank spreadsheet file • Have one person maintain the spreadsheet file to avoid multiple, conflicting versions

10. Budget Classification • A budget classification system is a mechanism for organizing the expenditures in a hierarchical structure • Budget classification of expenditure can be administrative, functional, program and economic • Administrative –Identifies the responsibilities for the main categories of the public expenditure and for day-to-day administration of the budget. Important to show the different levels of responsibility and accountability in budget management • Functional – Organizes government activities according to their purpose (i.e., education, health, social security). Shows how funds are allocated by sector. • Program -- A set of activities that meet the same goals and objectives (curative care services, preventive services) • Economic classification – identifies the inputs used that are transformed to provide a government services or good (e.g., salaries, supplies, transportation).

11. Step One: Identify and collect expenditure data • Identify and collect all relevant sources of information on government health expenditures: • Collect copies of executed budgets from government entities that are financing sources, financing agents, providers of healthcare services • For government entities: • Gather budgets from public institutions and entities at the central/federal, state/provincial/regional and district/local/municipal levels • If budget data is not available, secondary sources such as costing studies or utilization data from the HMIS can be used • Supplement with information from donors who contribute to the health budget through funds or in-kind donations

12. Step Two: Budget line item review • Study the government’s executed health budget to understand what’s behind each budget line item: • Work with government officials and staff who produced the executed budget to review budget line items • Review and adapt the NHA categories to reflect local context; • Determine level of disaggregation of data to reflect national health policy • Include all types of health entities involved in health care to be included • Adapt for subaccounts, as needed • Produce a modified NHA classification table as a basis for the mapping exercise

13. Step Three: Line-for Line mapping • Map each line item of the government’s executed budget to a corresponding NHA code: • First map all line items to financing sources, then financing agents, providers and functions • For financing sources: • Determine revenue sources for the Ministry of Health (primarily Ministry of Finance and donors) • Identify which funds are targeted and non-targeted and then map accordingly • Use a percentage for each line item to allocate financing sources across non-targeted line items

14. Step Three: Line-for Line mapping • Mapping non-targeted budget line items for financing sources: • Example: The MOH received for a given year $400 and spent $300 on health. Of the $300 spent, $100 is targeted for HIV/AIDS and Malaria programs and $200 is non-targeted. • Targeted: The $100 in targeted funds is from a grant from international organizations. It is matched with the relevant line items in the executed budget that correspond to HIV/AIDS and Malaria program expenditures. For those line items identified, the financing source will be FS.3 Rest of the World funds • Non-targeted: For the $200 of non-targeted funding, $100 is from foreign government and international organization grants and $100 from taxes collected from the MoF. Financing sources for the non-targeted funds are 50% FS.1.1 Territorial Government Funds and 50% FS.3 Rest of the World Funds. These percentages are then applied to the executed budget line items for non-targeted funds.

15. Documenting the budget line item

16. Documenting the budget line item

17. Step Three: Line-for Line mapping • Map to financing agents, providers and then function: • Financing Agent, is the government entity (e.g., MoH, Defense, Education, etc,) for which the budget is based and receives funds from the financing sources and uses them to pay for health services, products and activities. • Use NHA classification codes for Financing Agent (HF) • Providers, are the end users or final recipients of health care funds such as private and public hospitals, clinics and health care stations. • Use NHA classification codes for health care providers (HP) • Functions, are the services or activities that providers deliver with their funds (e.g., curative care, preventive services, health care administration • Use NHA classification codes for function (HC)

18. Step Three: Line-for Line mapping • Example: A segment from a Ministry of Health central hospital budget for administration, human resources and curative health services to illustrate mapping: • Group Exercise: Map each line item to a corresponding NHA category. Use the modified NHA classification table to select the appropriate codes (See handout).

19. Step Three: Line-for Line mapping Information needed for the mapping exercise: • FS: The Ministry of Health has received funds from the Ministry of Finance to finance administration, HR, curative health services for this central hospital. • HF: The Ministry of Health serves as the financing agent to transfer funds to the central hospital to cover expenses for administration, HR, curative services • HP: The provider is the main central hospital for Country X • HC: A range of secondary and tertiary curative health services are provided by the central hospital and the administration and HR expenses are related to curative services

20. Step Three: Line-for Line mapping • Suggested corresponding NHA codes for each line item for the MoH central hospital budget segment:

21. Step Four: Apportioning rules • The total costs for Administration and HR are allocated fully to curative care services without a breakdown between inpatient and outpatient • Determine apportioning rules for allocating budget line item figures across NHA codes: • For the previous mapping example, the MoH of Country X used a World Bank 2004 costing study that found outpatient services costs comprise about 25% of inpatient day equivalent • A ratio 25% outpatient/75% inpatient is then applied to breakdown total costs for Administration (Line 1) and Human Resources (Line 2)

22. Step Four: Apportioning rules • The inpatient/outpatient ratio is applied to allocate Administration and HR costs for the central hospital by type of curative care services:

23. Step Five: Crosswalk table • Produce a multidimensional crosswalk mapping table: • After completing steps 1 through 4, a crosswalk table is produced • It reflects the mapping of executed health budget line items to the four health financing dimensions (FS, HF, HP, HC) based on a template • The table structure will reflect the executed health budget format being mapped (e.g., administrative/program/economic, function/program/economic) • It will also be used to populate the NHA tables

24. Step Five: Crosswalk table

25. Case Study: Malawi MoHP budget • Malawi Health system: • The Ministry of Health and Population (MoHP) is the largest provider of public health services • The MoHP has 27 District health Offices and finances four central hospitals and a mental hospital • NHA Activity: • Malawi has conducted three rounds of NHA for 1998/99, 2002/05 and 2005/06 • A NHA team mapped the government’s 2004/05 actual expenditures to NHA classification for the 2002/05 NHA activity • The team modified the NHA classification codes to reflect the health system structure by adding codes for central hospitals (HP.1.1.1.1), district hospitals (HP.1.1.1.2) and peripheral facilities (HP.1.1.1.3) • Budget execution reports and cost studies were used for the mapping exercise

26. Case Study: Malawi MoHP budget • Ministry of Health and Population budget structure: • The MoHP executed budget is organized by facility (central hospitals, district hospitals) and administrative unit (MoHP headquarters, health commission) • It is based on 34 cost centers for each administrative unit and then broken down by program, subprogram and economic classification Facility Queen Elizabeth Central Hospital Program Curative Health Services Subprogram Secondary Inpatient Services Economic Basic Salaries Administrative Unit Administration Department, Ministry of Health Program Management and Development of HR Subprogram Professional Training Economic Supplies and Materials • See handout of MoHP budget breakdown for further details

27. Case Study: Malawi QECH budget Mapping the budget for Queen Elizabeth Central Hospital: • Use the budget table shell for QECH: • Review budget line items for each program • First, map line items to the NHA codes for financing sources, then financing agent, provider and function. • Use previous information for central hospital mapping exercise to determine NHA codes for financing sources, financing agent and providers • For functions, determine which lines directly correspond to a NHA code and those which need to be apportioned across codes

28. Case Study: Malawi QECH budget

29. Case Study: Zimbabwe health system • Zimbabwe Health system: • Public health care is delivered based on a four-tiered referral system • Health care services are provided by several government ministries: Ministries of Health and Child Welfare (MoHCW), Defense and Home Affairs • Ministry of Finance is the primary source of government financing for public health. Donors provide funds for the health system as well. • MoHCW manages the largest share of MoF financing and allocates funds to government facilities, mission, rural district hospitals and clinics, municipalities and financially supports private nursing homes

30. Case Study: Zimbabwe MoHCW budget • Ministry of Health and Child Welfare budget structure: • The MoHCW is primarily based on economic classification grouped by four main functional budget headings • Administration • Medical Care Services • Preventive Services • Research • Under each functional heading are subcategories that reflect health care providers (nursing care homes, central hospitals), resource costs (basic salaries, housing, transport) and/or program (environmental health, health education, nutrition) expenditures • See handout

31. Zimbabwe Ministry of Health Information needed for the mapping exercise: • FS: The Ministry of Health has received funds from the Ministry of Finance to finance preventive services • HF: The Ministry of Health serves as the financing agent to transfer funds to the providers to provide preventive services • HP: Information is not available in the executed budget on specific providers for preventive services. Use the general administration code for preventive services. • HC: Information is not available in the executed budget on specific types of preventive services. Use the general code for preventive services

32. Case Study: Zimbabwe MoHCW budget • Ministry of Health and Child Welfare medical care services budget:

33. Case Study: Zimbabwe MoHCW budget Mapping the budget line items for Preventive Services to NHA codes: • See handout of Preventive Services budget shell table • Review each budget line item under Preventive Services • First, map the line items to the corresponding NHA codes for financing sources, then financing agent, provider and function. • Fill in the cells with the suggested NHA code on the blank budget shell table • For functions, determine which lines directly correspond to a NHA code and those which need to be apportioned across codes

34. Case Study: Zimbabwe MoHCW budget

35. Handouts and additional materials Handouts: • NHA classification tables for FS, HF, HP and HC • General guidelines for apportioning rules • Modified NHA table for Country X • Budget shell table for Country X central hospital • Malawi budget structure table • Malawi Queen Elizabeth Central Hospital budget shell • Budget shell for Zimbabwe Preventive Services Available materials: • Draft NHA mapping guide with country examples

36. Thank you Reports related to this presentation are available at www.HS2020.org or email Marcia Occomy at marcia.occomy@bearingpoint.com