The purpose of this page is learning, information dissemination, and scientific debate for those interested in Egypt's public health and its linkages to human development and social justice. In doing so, this page is committed to have a neutral stand and to present all views equally. This blog is based on the work of different experts in their field.

Monday, November 28, 2011

Egypt’s Transition in the Health Sector: Opportunity for Raising Staff Moral & Restoring People's Confidence

Egypt's Transition towards a Third Wave of Health Sector Reform (2)

Egypt’s health sector has entered into a transition since its Cabinet has resigned in January 2011. The spirit of the revolution empowered health sector staff and a number of activists to raise a number of issues on their priority list.  A number of facebook groups interested in the health sector were formed allowing extensive exchange of views and in some cases lobbying for their views.   Monitoring feedback from these groups, the key issues raised were related to: (i) health workforce management and compensation; (ii) organization, governance and leadership of the health sector; (iii) health sector finance; (iv) responsiveness of the health system; and (v) quality of service delivery.   A common theme presented dissatisfaction with the performance of the health sector and an explicit sense of low morale.

On the positive side, these groups proposed solutions for the problems raised by them. One specific group, the Egypt Health Sector Reform Group, on its page proposed a list of priority actions to be tackled during Egypt’s transition.  Some of these are of short-term nature potentially capable of producing quick wins, as well could pave the way for a third wave of health sector reform once an elected government is in place.  

The purpose of this blog is to present an excerpt of this brainstorming, as I understood it.  Following a health systems framework, TWO proposed priority actions were selected under each element of this framework possibly feasible to be accomplished during the transition. It’s a message to those who are or will be in a decision making position in the health sector from those who are interested in the future of that sector.


Two key objectives to be achieved during the transition could be defined:
  1. Raising the morale of health sector staff and restoring people’s confidence in the management of the health sector and its services provision
  2. Preparing for the period after the transition


Objective 1: Raising Staff Moral and Restoring People’s Confidence in the Health Sector

1.       Increase responsiveness of the health service delivery system in terms of improved coverage, utilization, and quality of health services and accordingly client satisfaction and people’s confidence in the health sector
·         Through introducing improvements in the public health system by addressing priority gaps in service delivery and treating patients with respect.
·         Through expanding health service delivery by partnering with the civil society and contracting NGOs for a minimum quality of service delivery agreed upon for a defined package of services 

2.       Motivation of health workforce and raising staff morale
·         Introduction of payment for performance for the health workforce to improve staff compensation for better performance, quality, and system responsiveness taking in consideration different incentives for different geographic locations.
·         Training of middle management for preparation of calibers needed for management and potential for staffing for senior management.

3.       Making available funds by reallocation from other sources
·         From the newly allocated budget for the Program for Treatment on the Expense of State; and from investment budget lines for payment for services for CSOs (as mentioned above), payment for performance for public health sector staff, and procurement of drugs, supplies, maintenance, and training.
·         Postponing the social health insurance law until an elected people’s assembly is in place to decide about the health system appropriate for Egypt

4.       Improving Governance
·         Establishing of an independent Quality Organization to accredit public and NGO providers for a defined package of services
·         The separation between the payor and provision functions within the organizational structure of the Health Insurance Organization.

Objective 2: Preparing the Health Sector for the period after transition

·         Broad participation by key health stakeholders in discussions on Egypt’s health sector problems and its possible solutions including reaching a consensus on the health system  that Egypt should adopt (National Health System or Social Health Insurance) based on the society’s values and expectations.

·         Joint Expert/Politician Reviews to the health sector to prepare a paper on Egypt’s vision for the health sector

·         Based on the health sector vision, an Expert team to prepare a Health Sector Strategy.

Friday, November 25, 2011

Egypt's Transition towards a Third Wave of Health Sector Reform

Following the January 25th revolution, Egypt’s health sector started a period of transition which will be difficult to define how long it will take.  Since then, three Ministers were in charge with no success of being approved by the public or health sector staff posing an immense challenge for whoever will be in charge during the transition.  Dissatisfaction is due to presence of high expectations, absence of priority setting on few areas that could be accomplished, and absence of indicators to measure success of a transition. 

This transition is expected to be followed by a third wave of reform.  Lack of presence of strategic directions for a potential third wave of reform will hinder efforts to design and implement the transition.  A third wave of reform will be expected if we will look backwards at history of reform Egypt encountered. Reform phases could be classified as; (i) Pre-reform phase (before 1997) focusing on improving maternal/child health and fertility outcomes; (ii) First Reform Wave (1997-2005) focused on universal coverage through adopting a national health system; and (iii) Second Reform Wave (2006-2010) focused on expanding universal coverage through adopting social health insurance.

Pre-reform Phase (Before 1997)
This phase focused on improving health outcomes at primary health care targeting improvements in maternal and child health as well as fertility outcomes implemented by a number of vertical programs at primary health care level. Efforts towards efficiency focused on integration of child health services at primary health care level and on cost recovery at hospital care level, while efforts towards universal coverage and protection focused on expanding health insurance coverage, compulsory to school children and voluntary to pre-school children. 

The First Wave of Health Reform (1997-2005). 
Irrespective of its original design, this wave adopted a national health system (NHS) approach to achieve universal coverage – starting a pilot in five governorates.  It was led by the Ministry of Health (MoH), which was convenient given the ministry’s familiarity with NHS considering this reform as a natural continuation of its original work.  On the other hand, the Health Insurance Organization (HIO), which also was envisaged to be reformed, was not much involved and continued its role as originally assigned to it.  This phase introduced: (i) Family Health Services and its accreditation; (ii) needs based health facility planning; and (iii) payment for performance using Family Health Funds partially, an attempt to separate provision of services from its management.  Training of health workforce and quality were key factors increasing utilization, while user fees reversed gains in utilization. 

The Second Wave of Reform (2006-2010)
This phase adopted a social health insurance system (SHI) approach to achieve universal coverage - starting a pilot in one governorate; however, design was developed “as we go” and with a tendency to be conservative in expanding coverage.  The characteristic explicit shift in strategy from NHS to SHI was based on a policy paper prepared by the previous National Democratic Party (NDP), followed by a Presidential declaration in Sohag in 2005.  This shift forced a new stakeholder, the Ministry of Finance (MoF), to have a significant role in decision making during this phase.  This phase was partially led by HIO, with difficulties to reach consensus and the recognition for the need of additional studies to understand the fiscal implications of SHI on the budget.  Regretfully, a number of features developed under the first wave were dropped along the way.

The Transition
We are now in a transitional period, before a third wave of reform starts.  It might be prudent during this period to set modest objectives for this phase instead of trying to reform the whole system or passing critical laws such as SHI law.  It might be worthy to reach consent on the health system that would reflect the values of the people before embarking on Egypt’s third wave of reform.  Two sets of questions will need to be posed:

Are the people willing to accommodate the idea that reform will take longer than what they would expect, and are they willing to work in stages or phases with realistic objectives instead of full blown reforms?

If so,

What would be the priorities for the transition period and its minimum objectives, and how to measure its success? 

Two areas of priority could be identified to be demanded by the people and health sector staff during transition.  These are:

(1)    Governance and Anticorruption
(2)    Health Workforce. 

These are two broad areas that need to be further defined to ensure feasibility and successful implementation and to fairly hold a Minister of Health accountable for his or her performance of this period. Improvements in these two areas could reflect substantially on improvement in the provision of health care that could be favorably received by the people. 

Until we meet again....

Sunday, November 20, 2011

Is Social Health Insurance the Right Health Financing System for Egypt?

Egypt's Road towards Social Health Insurance - The Road to be Traveled (7)

At a time when Egypt is doing relatively well in reducing its child and maternal mortality, while facing extreme pressure on its budget to meet various demands by the public, in presence of notable inefficiencies in the health system presented mainly by fragmentation in the financing and the delivery of health services, and at a time when a draft social health insurance is presented for public discussion in a post-revolutionary situation that might allow to revisit health strategies designed in an earlier phase of reform, a question might be  posed before a final decision is made. Should Egypt stick to Social Health Insurance (SHI) as its main health financing strategy or could a better alternative scheme be available for Egypt to adopt. Is it too late to ask that question?

Governments usually aim to achieve universal coverage for health care for their people and people usually demands a health care system that meet their needs in terms of improved health, financial protection, and a system that is responsive and treat them with dignity.  To achieve that in Egypt, continues efforts have been put to reform the health care system increasingly since 1997; however, with modest efforts to include the public in that reform.  

Looking back, it is intriguing to note that during the last 60 years almost every attempt to reform the health sector in Egypt aiming to achieve this universal coverage promoting one health system or another as a means to achieve this end, ends up with an application of mixed and fragmented systems that were not able to meet the expectations demanded by the people.  I’ve always encountered this statement recurring in many international and national reports describing the health system in Egypt as “a pluralistic health system, consisting of a number of parallel public and private health care delivery systems and multiple financing intermediaries”.  The attempts to reform were not able to address this plurality and usually lead to more fragmentation of the system either at the delivery and/ or at the financing side ending up in a health system with multiple personalities.

The origin of this fragmentation has started a few decades ago, probably in the 50s and 60s, when two sets of parallel legalizations established the foundation for treatment on the expense of state (Presidential Decree 1754 in 1959 followed by Presidential Decree 1069 in 1964) and social health insurance (Law 75 in 1963 and Presidential Decree 1209 in 1964), probably trying to satisfy the demand of the people for better health care as well as a translation to Egypt’s constitutions placing the responsibility of provision of health care (Constitution 1956) and social insurance (Constitution 1964) including health to all Egyptians on the state.  These were followed by multiple additional decisions that further fragmented the delivery side that led to the proliferation of a number of governmental and public services delivery systems in addition to those of the Ministry of Health.  

And the question is “why is this happening?” Which system would be better for Egypt? A system based on general revenues and taxes or a system based on social health insurance?

Those who are in favor of tax-based systems argue for their system based on three points: (i) SHI discourages firms from hiring workers, and hence reduces employment and encourages informal labor markets; (ii) lack of coverage among certain groups during the often long period between establishing SHI and achieving universal coverage, and (iii) systematic variations in benefit packages and quality of care across subpopulations. 

On the other hand, those who promote SHI do that based on two points: (i) SHI provides an important additional source of revenue for the health system; (ii) by separating the purchasing of health care from its provision and encouraging selective contracting between providers (including private sector ones), SHI systems are able to achieve better quality health care at a lower cost than tax-financed health systems.

Certain studies focusing on studying the impact of these health systems on health outcomes in OECD countries suggested that SHI systems, on balance (i) have certain characteristics that make them more expensive than tax-financed systems,  (ii) do no better in terms of most health outcomes that are amenable to medical care despite the extra spending, (iii) may do worse in respect of outcomes that require strong population-level public health programs, and (iv) do worse in terms of encouraging informal labor markets and discouraging employment.  The findings of this study raise the following questions:

  •  Why do we apply a system that could cost us more with no additional improvement in health outcomes at a time when budgets are tight? Would this contribute to efficiency?
  •  Why do we apply a system that could increase informality in the employment sector when already two thirds of those working are informal workers without protection? Would this contribute to financial and social protection?
  • Are there dangers on our achievements in public health? As SHI systems focus on individual members, or even families, would we lose the focus on the entire population by public health programs financed by tax-financed systems?  Would this contribute to improved health status and outcomes?

All of the above would lead to the following question, and another two subsidiary questions?

Can we apply in Egypt a system that can capture the better of the two systems and avoid their problems?

Question 1:  Can we have a tax-based system with a directly managed provider network shift to a purchaser-provider-contracting model?

Under this scenario purchaser organizations contract with providers rather than manage them directly.  This can be done by adopting the SHI purchaser-provider split model where purchaser organizations contract with providers, including those which are not public providers.  This could lead to lower expenditures and better health outcomes.  However, to what extent this can be done without risking coherence and integration in its public health programs? The Egypt experience in introducing the Family Health Funds, governorate health insurance organizations that were established to do the purchasing function, is an example of an attempt in that regard. The ownership of these organizations between the Ministry of Health and the Health Insurance Organization remained for a long time and it failed to elaborate a national organization that would provide oversight for such decentralized bodies called the National Family Health Fund.  Further, this was countered by the Ministry of Health by establishing provider organizations at district level called the District Provider Organizations to ensure the flow of funds through its organization, which were dismantled later as the Egyptian health system geared more towards social health insurance..

Or Question 2: Can SHI system increase its reliance on tax revenues and capture some of the tax-based finance system functions?

This seems to be feasible to be done and the latest versions of the new social health insurance law provides different articles that attempt to increase its tax base and revenues from sources other than that from payroll taxes, although earmarked taxes is being proposed. This is the new experience that has been facing long debate before and after the January 25th revolution, and seems to continue for a while. The linkage of health insurance to family health services could be the basis for protecting the screening functions of public health programs.

At the end, a decision will need to be made by those who will represent Egypt in the new People’s Assembly and will then need to be implemented by the newly elected government in a few months to come.  This decision will need to select the system, SHI systems or tax-financed systems, which on balance would spend less, achieve better health, easier to go through the transition, and lead to better labor market outcomes.  

Until we meet again...

Sunday, November 13, 2011

A Framework for Reading Egypt’s Social Health Insurance Law

Egypt's Road towards Social Health Insurance - The Road to be Traveled (6)

This blog is based on the work of international experts in the field of social health insurance that was adapted to Egypt's situation. Arabic versions of this blog will dig into more details of the framework but might not follow the same sequence of this blog. Because of limitations of space, some ideas presented in this blog will be discussed separately in future blogs.

The recent news about the upcoming law for social health insurance in Egypt and the messages transmitted about its potential modifications to ensure its achievement of social justice raised the question about how to read such laws and what should be included in it.  To help read this kind of social laws, once officially published for public dialogue, the presence of a reference framework could assist in that regard. In this blog, we will try to contribute some inputs that may assist in the preparation of such a framework, which we do not claim it will be comprehensive. This blog will not attempt to review or criticize the content of the currently circulated versions of SHI law.  As well, this blog will not differentiate between what should be mentioned as articles of the law itself or articles of its executive regulations due to their complementarily nature.

The logic of a social health insurance law would probably include the following:

  • Definition of the social health insurance system
  • How to make effective the mandatory and universal features of the system
  •  Principles that the govern the system
  • Transition from the current situation to an integrated and unified system
  • Definition of terms
  • Who are the Beneficiaries
  • What to finance
  • How to finance the new system
  • Definition and main characteristics of the institution that will manage the system, including governance, functions, powers, financial management, and accountability
  • Purchasing health care goods and services
  • Consumer protection
  • Role of Voluntary health insurance
The Definition. In defining the social health insurance system three aspects are to be considered:
  1.  The nature of the social health insurance system
  2. The objective of the social health insurance system
  3. The institutional structure to implement the social health insurance system.
Also three main characteristics of the system would need to be taken into account:
  1. Universal, meaning that it includes all Egyptian citizens
  2. Mandatory, that is, all Egyptian citizens must participate (there is no opting out from paying into the system); 
  3. Gradual, full inclusion of all citizens (with few exemptions) into the system over a defined period of time, OR Abrupt
The Principles. These usually refer to: solidarity; unit of subscription (family or individual); basis on need or demand; scope of services (primary, secondary, tertiary); subscription basis (mandatory?), financing not provision and separation of financing from provision; role of private for profit and non-profit in service provision based on contracting; role of state in financing the poor and near poor (partially or fully); tax exemptions for subscriptions; role of private health insurance (duplicative, complementary, supplementary)

The Transition. A a transition plan from a presently fragmented institutional structure dominated by the HIO to a single institutional structure in the future will be required.  Details for this transition could take place and developed in regulatory decrees.  An article in the law might state the principles for transition.  The transition would describe the way forward to arrive over time at an “integrated” (meaning putting in one place a social health insurance system. Four issues related to transition would need to be noted:
  1. The responsibility of management of the system during transition
  2. The management of enrollment of all non-covered citizens;
  3. The management of those already covered by the existing HIO system and their enrollment into the new SHI if required, under a one “unified” system (in that case meaning the system managed by a single organization);  
  4. The relationship to other existing parallel health care financing systems such as the Program for Treatment on the Expense of State (PTES)  and those funds flowing for public health services provision for curative care in Egypt.
The Institution. Social health insurance systems can only be implemented through an institutional structure.  A future entity might be established, which could be (a) a re-structured HIO, or (b) a totally new entity transformed into the unified entity for the management of the integrated social health insurance system with its own legal autonomous status. The law and/or its regulations will need to define the aspects that will be mandated for the future organization such as governance, autonomy, structure, functions, powers or attributes, contracting, and regional offices.

What to Finance. The law will need to refer to a unified set of social health insurance benefits, the health care goods and services covered by social health insurance for health care. The set of benefits usually is to be determined and updated by regulatory decrees to be provided by participating providers and for secondary care on referral of the gatekeeper.  The law also should require that the set of benefits is to be determined on an actuarial analysis to project financial implications.  Finally, there is a need to entrust the decision-making on defining and updating the set of benefits into the social health insurance entity to preclude political influence that could disturb the goal of fiscal responsibility

How to Finance. Financing would better be presented in the form of groups to be covered classifying those into three sectors (formal; informal; and targeted subsidized). The figures for financing, preferably and if the constitution allows, should not be included in the law itself as they would be subject for future change; however, this might be difficult in Egypt. To mitigate that articles will need to indicate that it will reviewed on periodic basis based on actuarial studies conducted by the Government. This applies to contributions and subsidies, as well as for co-payment levels

Providers and Suppliers - Contracting. Articles should stipulate that the social health insurance entity is a financial institution that funds the provision of health care goods and services to public and private providers.  Selection of providers and suppliers should be stated for those who meet the requirements for contracting with the entity to ensure that providers and suppliers meet licensing and certification requirements, among others, and for improving quality of care.

Consumer Protection. Articles that protect the interest of consumers will need to be included that reflects a framework for a system of consumer protection that could be part of the regulations. 

Voluntary Health Insurance. If the policy is to have a private/public mix in health care financing and delivery, then articles that allow individuals to purchase voluntary health insurance will need to be included.  These services could be duplicative, supplemental or complementary, but only after certified satisfaction of payment of social health insurance contributions

Until we meet again....

Friday, November 4, 2011

The factors facilitating Egypt’s transition to Universal Coverage

Egypt's Road towards Social Health Insurance - The Road to be Traveled (5)

What could be the factors that would speed Egypt’s transition to expand universal coverage using social health insurance?  We will try to respond to this question based on the experiences of other countries and opinions of international experts.  In principle, the lower the country has in terms of income per capita, the smaller the formal sector, the higher the prevalence of poverty, and the higher the dependency ratio, the more it would be challenging to initiate or scale up SHI. 

Economic Development, in terms of a country’s annual general level of income (GNI) and growth rate. The greater the income per capita the more capacity enterprises and citizens will have to prepay SHI contributions.  The higher the wages and salaries, the more opportunity to finance a broader benefit entitlements and the less there could be an economic burden of payroll tax. Tax revenues are likely to increase with income, facilitating the subsequent channeling of any government subsidies into SHI. Steady economic growth, therefore, is likely to enhance the capacity to prepay.

In 2010 before the January 25th revolution, Egypt’s GNI was about USD 2,440 and its growth rate ranged between 5-7% annually. As a result of the slow in economic activity post the revolution, growth rate is predicted to go down to 2% or less for 2011. Egypt’s current GNI is similar to the GNI of those countries adopting SHI at the time of its introduction such as Germany (USD 2,237 in 1883), Austria (USD 2,420 in 1887), Belgium (USD 1,808 in 1851), and Japan (USD 2,140 in 1922). The same applies to growth rates.  Economic growth was either high or at least steady for each of these countries during the transition period.

Structure of the Economy, in terms of the relative sizes of the formal sector and informal economy. Many developing countries do have sectors where a notable part of employment is informal, thus facing difficulties in assessing incomes and collecting contributions from workers who do not receive a formal salary. This hampers protecting those working in the informal economy as SHI scheme relies on contributions. The larger the formal sector employment, the ease it would be to administer mandated payroll tax on employers and employees.

In Egypt, informality has been on the rise mainly due to two reasons: (i) a reduction in employment by the public sector and replacing those by employment using temporary contracts; and (ii) creation of most of the jobs in the private sector that are informal. More than half of those working are in the informal economy (53%) with an increased estimation of 20% of pre-revolution level. Looking more in-depth, 58% of those working don’t contribute to any social security scheme, 63% are working without contract, and 13% are working without being paid. As the public sector is shrinking and being perceived as the place providing “safer” jobs, and given the private sector’s inability to produce formal sector jobs, the challenges for coverage by social health insurance increase. 

Urbanization, determined by the distribution of the population intended to be covered. Population living in urban areas, with minimum quality of infrastructure and communications, and higher population density, is likely to be easier to cover than a widely dispersed rural population. About 43% of Egypt is urbanized with governorates ranging from high as 100% urbanized such as Cairo to a low as 22.5% such as Sharkia.  The more urbanized the governorate the more insured people would be present.

Ability to administer, in terms of availability of skilled labor force with capacities in bookkeeping, banking, and information processing; and related markets, such as in financial services, other insurance businesses that can provide appropriately trained personnel, actuarial, and legal services. Presence of a sound administration of social security system is in place would be a favorable factor.

Although HIO has been present for about half a century, yet most of its experience is in service provision and has lost a number of experts who understood insurance without being properly replaced. The HIO payer functions will need efforts to be built and investment in this area would be a pre-requisite if Egypt would continue to pursue health insurance as a financing scheme for universal coverage. 

Poverty Prevalence, in terms of size of government’s contribution to subsidize their premiums and co-payments. The higher prevalence of poor and near poor Egyptians, the more the government would need to contribute and the higher the burden is on the government’s budget. The society as a whole, and not only the government, would need to define what appropriate level of solidarity it is ready to contribute to cross subsidize the services of its poor people either fully or partially for the near poor.  The higher the level of solidarity, the more SHI is able to provide protection to its most vulnerable segment of its population. While policymakers could impose solidarity; however, without a society that believes in solidarity, it will be difficult to sustain SHI.   

Two more important factors that need to considered.  The first is the presence of efficient functioning provider networks, in terms of (i) ability to provide an improved access to members; (ii) ability to provide greater choice of providers to members, and (ii) ability to provide an environment that allows for quality-based competition among providers.  The second is the government’s capacity to regulate for quality and manage grievance procedures.

In summary, Egypt’s ability to expand universal coverage through SHI will depend mainly on the following: (i) its ability to recover from the aftershocks of the revolution and resume its pre-revolution high growth rate, as well increase its level of GNI; (ii) its ability to formalize its economy with protected jobs; (iii) its ability to become more urbanized; (iv) its ability of building its health insurance administration system; (v) its level of poverty and society’s willingness to cross-subsidize the poor; (vi) its ownership of an efficient and functional provider network; and (vii) its ability to regulate.    

Until we meet again...

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