EC ON OM IC D EVE LO PM ENT IN ST IT U TE OF T HE WO R L D B AN K Sustainable Health Care Financing in Southern Africa Public Disclosure Authorized Papers from an EDI Health Polic'v Semiiitar held in Johannlesbuirg, Southi Africa, June 1996 Allison Beattie 17 Jane Dohertm Edited by Lucy Gilson |I qs3 Evitavo Lambo Public Disclosure Authorized Paul Shawv Public Disclosure Authorized C .C3r, -> ,,-,_ _C.,> C3 e3 C3 , Public Disclosure Authorized EDI Learning ReSOLrcesSeries EDI LEARNINGRESOURCES SERIES Sustainable Health Care Financing in Southern Africa Papersfrom an EDI Health Policy Seminar held in Johannesburg,South Africa, June 1996 Edited by Allison Beattie Jane Doherty Lucy Gilson Eyitayo Lambo Paul Shaw The World Bank Washington, D. C. Copyright © 1998 The International Bank for Reconstruction and Development / THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. All rights reserved Manufactured in the United States of America First printing May 1998 The Economic Development Institute (EDI) was established by the World Bank in 1955 to train officials concerned with development planning, policymaking, investment analysis, and project implementation in member developing countries. At present the substance of the EDI's work emphasizes macroeconomic and sectoral economic policy analysis. Through a variety of courses, seminars, and workshops, most of which are given overseas in cooperation with local institutions, the EDI seeks to sharpen analytical skills used in policy analysis and to broaden understanding of the experience of individual countries with economic development. Although the EDI's publications are designed to support its training activities, many are of interest to a much broader audience. EDI materials, including any findings, interpretations, and conclusions, are entirely those of the authors and should not be attributed in any manner to the World Bank, to its affiliated organizations, or to members of its Board of Executive Directors or the countries they represent. Because of the informality of this series and to make the publication available with the least possible delay, the manuscript has not been edited as fully as would be the case with a more formal document, and the World Bank accepts no responsibility for errors. Some sources cited in this paper may be informal documents that are not readily available. The material in this publication is copyrighted. Requests for permission to reproduce portions of it should be sent to the Office of the Publisher at the address shown in the copyright notice above. The World Bank encourages dissemination of its work and will normally give permission promptly and, when the reproduction is for noncommercial purposes, without asking a fee. Permission to photocopy portions for classroom use is granted through the Copyright Clearance Center, Inc., Suite 910,222 Rosewood Drive, Danvers, Massachusetts 01923, U.S.A. The complete backlist of publications from the World Bank is shown in the annual IHtdexof Pzblications,which contains an alphabetical title list with full ordering information. The latest edition is available free of charge from the Office of the Publisher, 1818 H Street, N.W., Washington, D.C. 20433, U.S.A. Cover design by Tomoko Hirata. At the time of writing, Allison Beattie was a consultant to the Human Resources and Poverty Division of the World Bank's Economic Development Institute. Jane Doherty is leader of the Health Economics Financing Group at Witwatersrand University's Center for Health Policy. Lucy Gilson is senior research officer at Witwatersrand University's Center for Health Policy. Eyitayo Lambo is a health economist at the World Health Organization/AFRICA. Paul Shaw is principal human resource economist in the Human Resources and Poverty Division of the World Bank's Economic Development Institute. Library of Congress Cataloging-in-Publication Data Sustainable health care financing in Southern Africa: papers from an EDI health policy seminar held in Johannesburg, South Africa, June 1996 / edited by Allison Beattie ... let al.]. p. cm.-(EDI learning resources series) ISBN 0-8213-4145-6 1. Medical care-Africa, Southern-Financing-Congresses. 2. Health care reform-Africa, Southern-Congresses. I. Beattie, Allison. II. Economic Development Institute (Washington, D.C.) III. Series. RA410.55.A356S87 1998 338.4'33621'0968-dc2l 97-44593 CIP Contents Foreword vii Preface ix Acknowledgments xi Executive Summary xiii PARTI-SEMINAR PROCEEDINGS 1 1. Sustainable Financing in the Broader Framework of Health System Reform 3 2. Implementing Health Financing Reforms in Southern Africa 9 PARTII-OVERVIEW PAPERS 33 3. The Lessons of User Fee Experience in Africa 35 Lucy Gilson, Center for Health Policy, Department of Community Health, University of Witwatersrand, South Africa, and Health Economics and Financing Programme, London School of Hygiene and Tropical Medicine, United Kingdom 4. Aims and Performance of Prepayment Schemes 49 Eyitayo Lambo, World Health Organization, Regional Office for Africa, Brazzaville, Republic of Congo 5. Health Insurance for the Formal Sector in Africa: Yes, But ... 61 Joseph Kutzin, Health Economist, Analysis, Research, and Assessment Division, World Health Organization 6. Public-Private Collaboration in Health: Issues and Implementation. 75 Ellias E. Ngalande-Banda, Ministry of Finance, Malawi iii 7. District Control and Accountability in Botswana's Health Care System 83 Patrick P. Molutsi, Senior Lecturer, Department of Sociology, University of Botswana, Gaborone 8. The Hospital Strategy Project in South Africa 91 Monitor Company, Health Partners International, Center for Health Policy, and National Labor and Economic Development Institute, South Africa PARTHII-COUNTRY PAPERS 99 9. User Fees in Swaziland 101 Prepared for the Ministry of Health, Swaziland, by Maphalala Nomaxhule, United Nations Development Programme; Dumsane E. Masilela, Ministry of Finance, Swaziland; and Thulani Matsebula, Ministry of Health, Swaziland 10. The Community Health Fund in Tanzania 109 R. M. Shirima, Community Health Fund Consultant, Ministry of Health, Tanzania 11. Current Issues, Prospects, and Programs in Health Insurance in Zimbabwe 117 T. A. Zigora, Deputy Secretary,Ministry of Health and Child Welfare, Zimbabwe 12. Public-Private Collaboration in Lesotho 125 Prepared for the Ministry of Health, Lesotho, by M. Nkuebe, G. P. Nchee, M. Makhakhe, and C. S. Ts'epe 13. Public-Private Collaboration in Malawi 131 Ministry of Health and Population, Malawi 14. Reprioritizing Public Health Resources Toward Primary Health Care in Mozambique 137 Ministry of Health, Mozambique 15. District Financing Issues and Implementation in Botswana 147 Ministry of Health, Botswana 16. EffectiveCoordination and Use of Donor Funding in Angola 153 Nkanga K. Guimaraes, Central TechnicalSupport Unit/Community Rehabilitation Programme/Miniplan, Angola; Sousa Diogo, Budget Technician, Planning Bureau, Ministry of Health, Angola; Joaquim Saweka, Advisor in International Cooperation and Health Policy, Ministry of Health, Angola; and Augusto Chipesse, General Secretary of the Council of Christian Churches of Angola 17. EffectiveCoordination and Use of Donor Funding in Zambia 159 Katele Kalumba, Minister of Health, Zambia, and V. Musowe, Chief Health Planner, Ministry of Health, Zambia iv APPENDIXES 167 Appendix 1: Final List of Participants 169 Appendix 2: Seminar Agenda 175 v Foreword This publication contains papers presented at a senior policy seminar held in Johannesburg, South Africa, in June 1996, and summa:rizes the proceedings. Participants included delegations from the southern African countries of Angola, Botswana, Lesotho, Malawi, Mozambique, South Africa, Swaziland, Tanzania, Zam- bia, and Zimbabwe. The Center for Health Policy, University of Witwatersrand, South Africa; the World Health Organization's Regional Office for Africa; and the Economic Development Institute of the World Bank jointly sponsored the seminar. The purpose of the seminar was to examine two facets of sustainable health care financing. On the one hand, participants discussed ways to raise additional revenues for health, including the "do's" and "don'ts" of user fees, experience with prepaid risk-sharing mechanisms in rural areas, formal health insurance, and improved modes of public-private collaboration. On the other hand, they concentrated on ways to use available resources more effectively to extract more value for the money. Topics included orienting public health resources toward primary health care, improving control of and accountability for district financing, improving hospital efficiency through cost containment and contracting out, and making more effective use of donor funding. By widely disseminating the seminar's proceedings, the Economic Development Institute and its part- ners seek to contribute to the knowledge base on health care reform and financing issues in the low- and middle-income countries of Africa and elsewhere. By presenting the original papers, as prepared and sub- mitted by the participants, this publication honors the collaborative spirit of the seminar whereby policymakers from different countries shared their experiences and lessons learned in search of their com- mon goal, to improve the health and well-being of their populations. Vinod Thomas Director Economic Development Institute vii Preface The topics discussed at the seminar fall into two broad categories, namely, those concerned with ways to increase the pool of available resources and those that