In a blog post earlier this spring, we shared a story of a woman who named her newborn baby “Hygeia” after the health insurance plan that may have saved their lives when a complication during childbirth forced the mother to seek expensive hospital care. The Hygeia Community Health Plan now covers over 75,000 individuals in Lagos and Kwara State and allows members access to a broad package of services for about $2 a year. Hygeia is one example of over 200 Financing Care initiatives profiled in the CHMI database. Recognizing the essential role that financing programs and products play in the health market, this month’s “Database at a Glance” takes a look at how health market innovations are making care more accessible and affordable for the poor.
The CHMI database profiles seven types of health financing programs. These include demand-side financing – programs that direct funds to consumers in order to decrease financial barriers to care (government health insurance, private insurance, micro/community health insurance, and vouchers), contracting, a supply-side intervention that channels funds to existing providers in order to expand their reach, cross-subsidization, a popular pro-poor pricing model that redirects revenue from wealthy patients to cover those unable to pay, and health savings *, programs that encourage consumers to save for future healthcare needs. See full CHMI Framework and Definitions.
Some of these mechanisms, such as cross-subsidization and private health insurance, have long been used to protect against catastrophic health spending. Others, particularly micro/community health insurance (smaller, more targeted schemes) and vouchers, have gained important momentum in recent years.
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- The last decade has seen an important expansion in government health insurance, with a number of countries undergoing reforms to achieve universal health coverage. The Ghanaian National Health Insurance Scheme (NHIS), for example, has enrolled 12 million individuals – accounting for 61% of the population since 2004. In 2003, Rwanda’s Community-Based Health Insurance (CBHI) schemes were expanded into a national system, leading to a rapid uptick in coverage. By 2010, approximately 90% of the population was covered by the program.
- Complementing public financing are smaller micro and community health insurance programs, which are rapidly growing in number. Though they remain small-scale, schemes such as those offered by MicroEnsure, which recently expanded into Tanzania, and SKY Microinsurance, operating in Cambodia since 2007, often target the “last mile”, individuals not reached by larger financing programs.
- Finally, vouchers have emerged as a popular model to finance care for a specific set of services. The number of programs in the CHMI database that launched after 2006 is more than double the number launched in 2000-2006. This partially reflects an increasing trend in social franchises to adopt vouchers as an effective tool to generate demand and growing evidence that vouchers increase utilization of key health interventions such as maternal care packages. For now, vouchers remain a relatively small source of payment for most facilities, though a few standouts exist. Reproductive health vouchers account for 75% and 50% of the payment source for the ProFemina franchise in Madagascar and BlueStar Sierra Leone, respectively.**
Now that we’ve looked at the proliferation of programs over the last decade, let’s see what CHMI data tell us about the major health areas addressed by each financing mechanism. Mapping these two attributes reveals that most programs use a wide variety of financing tools to increase access to care, though a few, such as chronic diseases, family planning/reproductive health (FP/RH) and eye care, are dominated by one or two mechanisms.***
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- Cross subsidization is used to finance a wide range of services. However, it is particularly important in increasing the affordability of costly care in the absence of comprehensive insurance. Cross-subsidization is a key operational component of specialty eye hospitals such as Aravind and L V Prasad Eye Institute in India, and the ASEMBIS network of eye clinics in El Salvador. It is also the most common mechanism used to finance care for chronic diseases and general secondary/tertiary health services.
- Vouchers – either distributed free or sold for a small fee – have emerged as a key financing strategy to help the poor access family planning/reproductive health and maternal and child care services, accounting for about 75% and 50% of all CHMI-profiled demand-side financing programs addressing FP/RH and MNCH, respectively.
- Contracting appears to be a popular mechanism to finance emergency care, particularly in India where state governments have either contracted companies such as Ziqitza or groups of private providers such as in the Janani Express model in Madhya Pradesh to operate ambulance networks. Contracting is also frequently used to expand the availability of key health interventions such as basic primary care and maternal and child health services, health areas accounting for half of all contracting initiatives.
A caveat to these preliminary conclusions: CHMI’s data collection methodology and relationships with partner organizations in specific countries may result in data collection biases. Specifically, as CHMI focuses on profiling programs that are active at the time of data collection, the database does not contain comprehensive historical information about initiatives that have operated and closed over the years. The historical data set will evolve as we continue to follow the development of profiled programs.
As we gather more data about the universe of health market innovations, we will continue to track trends and highlight new insights gleaned from analysis of the aggregate. We invite you to do the same by downloading the CHMI Database and sharing your findings with us!
*Health savings – the newest CHMI category – was excluded from this analysis because of its small program sample.
**Schlein, K., Drasser, K. and Montagu, D. (2011). Clinical Social Franchising Compendium: An Annual Survey of Programs, 2011. San Francisco: The Global Health Group – UCSF.
***Mental health, nutrition, dentistry, rehabilitative care, and TB programs were excluded from this analysis because of a small program sample.