Overview of Health System Performance

2. Overview of Health System Performance Kavoos Basmenji PharmD

3. What Constitutes the Health System? • Care providers • Financial intermediaries • Input producers • Planners and regulators • Preventive service providers • Other actors producing system outcomes

4. Characteristics of Health Systems • Complexity: multiple actors with multiple connections • Conflict: different participants have different objectives • Politics matters: decisions inevitably reflect political process • Societal context matters: conditions and options reflects culture, history and social norms

5. What Do We Mean by “Health Systems Reform”? • Purposeful efforts to change the system to improve its performance • “little r” reforms; Small changes to one or a few features of the system • “Big R” reforms; Large changes to more than one feature of the system

6. Why Is Successful Reform Difficult? • The consequences of actions are difficult to predict • Health systems have multiple goals. Doing better on one goal may mean doing worse on another • Those who benefit from the system are powerful and resist change. Those who benefit from change are often less powerful • Countries are limited by their economic and administrative capacity

7. Why Think Systematically About Health Systems Reform? • Avoid unintended results • Anticipate likely problems • Clarify goals and priorities • Facilitate accountability and transparency

8. What Starts The Cycle of Reform? • Economic crisis • Political change • External pressure • Unhappy interest groups

9. Define The Problem Evaluate Politics Ethics The Health Systems Reform Cycle Implement Decide What to Do Identify Causes Develop Options

10. How Does Real Reform Proceed? • People begin with a diagnosis • People begin with a solution • Timing is critical

11. Define The Problem Identify Causes Evaluate Implement Develop Options Decide What to Do How Should We Define Problems? • The health system is a means. Reformers need to think deeply about the ends • Problems should be defined based on poor performance in terms of outcomes • Aspects of the system only need to be changed if the changes contribute to improving poor performance • Defining the problem has to be done carefully because it will influence what solutions you choose In thinking about problem definition we can ask two kinds of questions. The first kind is normative or prescriptive: What makes for a good problem definition? What makes one area of poor performance a more appropriate priority than another? Answering this question involves ethics and philosophy. The second kind of question is empirical or descriptive: What social processes shape how problems are perceived? What factors determine the problem definition that reformers confront?

12. How Do We Know Which Aspects of Performance Matter? • Different groups will have different views • Political processes often produce an uneasy compromise • Reformers can influence those processes • Reformers have to consider ethics and values to know what performance problems to focus on Advocates with strong commitments to a particular policy often begin the reform process with their favorite solution. As the saying goes, “To a man with a hammer, everything looks like a nail.” Basic framing assumptions, which are called “paradigms,” generally shape our thinking about a particular problem. from a normative point of view, data alone cannot completely define problems and priorities for health reform. Any policy decision must rely, implicitly or explicitly, on bothscience and ethics. One important use of data in the process of problem definition is through a process called benchmarking, In health sector reform, benchmarking means looking at countries similar to one’s own in income and spending levels, whose health system performance is particularly effective.

13. The Role Of Ethics In Problem Definition • Deciding what aspects of performance matter is not just a technical question • Deciding what matters requires values • Exploring ethical theory allows us to clarify both our assumptions and their implications • The problem definition influences all that follows • One such concern is the health status of the population: How long do people live, what disabilities do they have, and how do these vary across various population groups? • A second set of outcomes is the degree of satisfaction that health care produces among the citizens of a society. • A third set of outcomes involves financial risk protection: the capacity of a health care system to protect individuals against the serious financial burden that disease can product.

14. Define The Problem Identify Causes Evaluate Implement Develop Options Decide What to Do Identifying Causes: The Diagnostic Journey • Start with performance problems • Ask “why” five times • Go from causes, to causes of causes, etc. • Work “backwards” • Be “evidence based” Controlknobs describe discrete areas of health system structure and function that matter significantly for health system performance—and are subject to change as part of health reform.

15. control knobs of the health sector Financingrefers to all mechanisms for raising the money that pays for activities in the health sector. These mechanisms include taxes, insurance premiums, and direct payments by patients. The design of the institutions that collect the money (e.g., insurance companies, social insurance funds) is also part of this control knob, as is the allocation of resources to different priorities

16. control knobs of the health sector Paymentrefers to the methods for transferring money to health care providers (doctors, hospitals, and public health workers), such as fees, capitation, and budgets. These methods in turn create incentives, which influence how those providers behave. Money paid directly by patients is also included in this control knob

17. control knobs of the health sector • Organizationrefers to mechanisms reformers use to affect the mix of providers in health care markets, their structure, roles and functions, and how these providers operate internally. • These mechanisms include measures affecting competition, decentralization, and direct control of providers making up government service delivery. • It includes who does what and who competes with whom, as well as the managerial aspects of how providers work internally, such as how managers are chosen and how employees are rewarded

18. control knobs of the health sector Regulationrefers to the use of coercive efforts by the state to alter the behavior of actors in the health system, including providers, insurance companies, and patients. Just because a regulation is on the books does not mean it is implemented and enforced.

19. control knobs of the health sector Behaviorincludes efforts to influence what individuals do in relation to health and health care, including both patients and providers. This control knob includes everything from mass media campaigns on smoking, to changes in sexual behavior for HIV prevention, to using the medical society to influence physician behavior, to persuading citizens to accept restrictions on choice of provider

20. control knobs of the health sector The “settings” on these control knobs explain many aspects of health system performance. Financingdetermines what resources are available. Paymentdetermines on what terms those resources are available to providers. Organizationdetermines the kinds of provider organizations that exist and their internal structures, which in turn shapes how these organizations perform. Regulationimposes constraints on those behaviors. Behavior influence how individuals respond to health sector organizations, which in turn shapes the opportunities that organizations confront.

21. Define The Problem Identify Causes Evaluate Implement Develop Options Decide What to Do Developing Options • Build on a sound model of • a) what drives health system performance • b) what can be changed • “Imitate but adapt” – learn from others but consider local conditions • “Process matters” – how you go about this task will influence the political acceptability and the quality of the plan • New Ideas • International learning • Policy innovations outside the health sector • Theory • Looking Forward • The political acceptability • Administrative capacity • The Design Process • Technically sound • Politically feasible

22. Define The Problem Identify Causes Evaluate Implement Develop Options Decide What to Do Reaching A Political Decision • Health sector reform is unavoidably political • Doing better requires political skill, not just political will • Stakeholder analysis as a starting point • From “mapping” to strategy • Health reform typically confronts difficult political challenges. Organized interest groups with a large stake in the current system (e.g., physicians, hospital owners, and the pharmaceutical industry) are likely to oppose reform. • On the other hand, the intended beneficiaries of health reform (e.g., sick patients, the poor, and the underserved) are often less powerful and less well organized. • Some potential beneficiaries within the health system (e.g., new family doctors yet to be trained) may not exist, and so cannot play an effective role

23. Define The Problem Identify Causes Evaluate Implement Develop Options Decide What to Do Many Health Sector Reform Efforts Have Failed at The Stage of Implementation • Ministers often lack administrative experience • Leaders turn over quickly • Implementation is not considered in program design • Entrenched interests resist • Political attention turns elsewhere

24. Define The Problem Identify Causes Evaluate Implement Develop Options Decide What to Do Keys To A Successful Evaluation • Design an evaluation strategy in advance • Anticipate likely problems • Collect data before you begin • Create incentives for good evaluation Successful evaluation has to begin well before a new program is implemented. Determining the effects of a new policy in a changing world is inherently difficult. The question often arises of whether what happens is the result of the reform or would have occurred anyway. The simplest evaluation approach is a before-and-after comparison The classic solution to this problem is to establish a “control group,” a population not subject to a new program or policy, but which is studied in the same way as the experimental group. This allows a “difference in differences” approach, which compares the before-and-after differences between the experimental and control groups Alternatively, a similar neighboring country could provide something of a baseline.

25. Define The Problem Identify Causes Evaluate Implement Develop Options Decide What to Do Why Does the Cycle Often Begin Again? • Poor design or execution leads to unsatisfactory results • Even successful reforms often create new problems • Actors defend their interests in unanticipated ways • Social, economic or political conditions change • Poor design or execution leads to unsatisfactory results • Even successful reforms often create new problems • Actors defend their interests in unanticipated ways • Social, economic or political conditions change

26. Health Sector Reform Requires A Set Of Skills • Skills are developed by practice • Rules can help, but specific situations require judgment • Learning requires effort and active participation