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UNIVERZALIZATION OF SOCIAL PROTECTION IN HEALTH COVERAGE

UNIVERZALIZATION OF SOCIAL PROTECTION IN HEALTH COVERAGE. Daniel Titelman Chief, Development Studies Unit. HISTORICAL BACKGROUND AND REFORMS IN THE 1990s. The Welfare State based on a “working society” has been an unmet promise. Low coverage, which impacts social exclusion

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UNIVERZALIZATION OF SOCIAL PROTECTION IN HEALTH COVERAGE

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  1. UNIVERZALIZATION OF SOCIAL PROTECTION IN HEALTH COVERAGE Daniel Titelman Chief, Development Studies Unit

  2. HISTORICAL BACKGROUND AND REFORMS IN THE 1990s • The Welfare State based on a “working society” has been an unmet promise. • Low coverage, which impacts social exclusion • Inequality in income distribution, which transfers over to social protection. • The reforms during the 1990s sought to improve financing and access through: • A stronger relationship between employment and protection, through the formalization of the labor market • Emphasis on incentive and efficiency mechanisms, more than on solidarity mechanisms

  3. CONTEXT OF THE REFORMS OF THE 1990s • The design of the reforms was not the most appropriate for the problems in the region. • Growth, which was low and volatile, was not favorable. • The dynamic of the labor market was not as expected: • High unemployment • Informality and precarization of work • Fiscal restrictions implied low, non-contributory coverage.

  4. LATIN AMERICA: COVERAGE IN 1990 AND 2002 (% of employed that contribute) COUNTRIES IN WHICH COVERAGE IMPROVED COUNTRIES IN WHICH COVERAGE WORSENED IN SPITE OF THE REFORM, CONTRIBUTORY COVERAGE HAS NOT INCREASED SINCE 1990

  5. INEQUITY IN THE CONTRIBUTION STRUCTURE Formal Urban Infor- mal Urban Q5 Q1 (rich) (poor) Men Women (% of working age) Urban Rural

  6. 29.1% 20.7% 17.9% 16% 16.3% SECTORAL DISTRIBUTION AND COMPOSITION OF SOCIAL SPENDING, BY INCOME STRATUM

  7. IN SUMMARY On average, • 4 out of 10 workers that are employed contribute to social security. • 4 out of 10 people over age 70 receive retirement or pension income. • 4 out of 10 people live in poverty conditions. There is great heterogeneity among the countries in the region.

  8. SOCIAL PROTECTION: A CHANGE IN FOCUS • Work is not perceived as the exclusive mechanism for accessing social protection in the short and intermediate term. • Requires a better balance between incentives and solidarity. • New pressures due to demographic and epidemiological changes and changes in the family structure. A new social consensus is required in order to universalize social protection

  9. CONTENT OF A NEW SOCIAL PACT • Explicit, guaranteed and compulsory • Definition of financing levels and sources (solidarity mechanisms) • Development of social institutionality

  10. ECONOMIC AND SOCIAL RIGHTS IN PUBLIC POLICIES • Three dimensions of rights: • ethical • procedural • contents Advancing toward the construction of a true social citizenship

  11. SOURCES OF FINANCING • The challenges of social protection require: • Increased non-contributory financing: increased collections and reallocation of spending • Increased contributory financing • A solidarity component without contributory financing.

  12. PUBLIC SPENDING: GREAT DIVERSITY OF SITUATIONS Dom. Rep. Contributions to soc. sec. LA: Trib. Inc. + Soc. Sec. LA: Total (20.8%) OECD Average (36.3%) Tributary income a/ Other income b/ Capital income

  13. CHALLENGES TO SOCIAL PROTECTION IN HEALTH • Strong inequity in access to health services in the region

  14. INEQUITY: OUT-OF-POCKET SPENDING ON HEALTH

  15. CHALLENGES TO SOCIAL PROTECTION IN HEALTH • Strong inequity in access to health services in the region • Demographic, epidemiological and technological transition

  16. INCIDENCE OF DISEASESDALYs per 1,000 inhabitants

  17. CHALLENGES TO SOCIAL PROTECTION IN HEALTH • Strong inequity in access to health services in the region • Demographic, epidemiological and technological transition • Problems in the articulation of financing and service provision among sub-systems Advancing toward universalization

  18. SEGMENTATION OF HEALTH SECTOR

  19. DUALITY OF FINANCING SOURCES IMPOSES CHALLENGES ON SOCIAL PROTECTION IN HEALTH SYSTEMS • Overcome traditional segmentation between contributory social security and the non-contributory public system: • Gains in macro-efficiency due to better utilization of the available capacity. • Greater and better management of social risks. • Reduces incentives for “cream skimming.” • Strengthens solidarity mechanisms.

  20. HEALTH: INTEGRATION OF THE PUBLIC AND SOCIAL SECURITY SUB-SYSTEMS • Universal Insurance by combining contributory and non-contributory sources. • Define benefits with universal coverage and guaranteed fulfillment (of health needs). • Rationalization of the use of the existing capacity. • Quality of the services is a fundamental incentive. • Purchasing and payment mechanisms. • Strengthen Primary Care.

  21. IN SUMMARY • Universalizing and improving social protection is an unfinished task • Employment is not enough for universalizing coverage • Solidarity mechanisms should play a fundamental role, combined with improvements in the incentive systems • Reforms should integrate contributory and non-contributory schemes. Reforms in the context of a social consensus where rights are the normative horizon and economic restrictions are limitations to confront

  22. UNIVERZALIZATION OF SOCIAL PROTECTION IN HEALTH COVERAGE Daniel Titelman Chief, Development Studies Unit

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