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Ll0p. -- Oi.Lc AGENCY 'OR INTERNATIONAL DEVELOPMENT FOR AID USE ONLY WASHINGTON, D. C, 20523 BIBLIOGRAPHIC INPUT SHEET A. PRIMARY 1. SU9JECT PUBLIC HEALTH CLAS I- FICATION B,5rCONDARY PUBLIC HEALTH 2. TITLE AND SUBTITLE An analysis of the structure,equity,and effectiveness of public sector health systems in developing countries,the case of Tunisia,1960-1972 3. AUTHOR(S) Heller,P.S. 4. DOCOIMENT DATE NUMBER OF PAGES 6. ARC NUMBER " 1975 ll0p. AR-- -- oI.Lc"I­ 7. REFERENCE ORGAI, ZATION NAME AND ADDRESS University of Michigan Center for Research on Economic Development Ann Arbor, Michigan 48108 8. SUPPLEMENTARY NOTES (Sponsoring Organization, Publishers, Availability) Available fror ,bove address for $1 plus postage and handling 9. ABSTRACT This paper presents an economic analysis of the health and medical sector in Tunisia. After reviewing the structure of investment and recurrent expenditure policy over the first planning decade, it analyzes the effectiveness with which resources are allocated in the health system. It provides a theoretical framcwork for the analysis of medical referral systems as well as an analysis of (1) the pattern of demand for medical services, (2) the operating characteristics of Tunisia's medical referral system, (3) the causes of capacity underutilization in hospitals and (4) the incidence of government medical expenditure. Finally, the paper evaluates Tunisia's medical manpower strategy. 10. CONTROL NUMBER 11. PRICE OF DOCUMENT PN-AAB- / 40 12. DESCRIPTORS 13. PROJECT NUMBER Investment, Expenditure Policy, Demand, Medical Referral 931-11-995-118 System, Medical Manpower, Capacity Utilization 14. CONTRACT NUMEER CSD-2547 211(d) 15. TYPE OF DOCUMENT Discussion Paper AID 590-1 (4-74) AN ANALYSIS OF THE STRUCTURE, EQUITY AND EFFECTIVENESS OF PUBLIC SECTOR HEALTH SYSTEMS .IN DEVELOPING COUNTRIES: THE CASE OF TUNISIA 1960 - 1972 Peter S. Helier CENTER FOR RESEARCH ON ECONOMIG DEVELOPME&N.: The University of Michigan Ann Arbor, Michigan 48108 Discussion Paper No, 43 February 1975 AN ANALYSIS OF THE STRUCTURE, EQUITY AND EFFECTIVENEFS OF PUBLIC SECTOR HEALTH SYSTEMS IN DEVELOPING COUNTRIES: THE CASE OF TUNISIA, 1960-1972 Peter S. Heller This paper presents an economic analysis of the health and medical sector in Tunisia. After reviewing the structure of investment and recurrent expenditure policy over the first planning decade, it analyzes the effectiveness with which resources are allocated in the health system. It provides a theoretical framework for the analysis of medical rcferral systems as well as an analysis of (1) the pattern of demand for medical services, (2) the operating characteristics of Tunisia's medical referral system, (3) the causes of capacity underutilization in hospitals and (4) the incidence of government medical expenditure. Finally, the paper evaluates Tunisia's medical manpower strategy. Table of Contents page List of Tables (iii) I. Introduction ............................................. II. The Structure of Health Sector Policy in the 1960's ........... 4 A. The Rationale of Health Policy in Tunisia: 1960-1972 .............. ............................. 4 B. Investment Policy in the Health Sector in the 1960's .............. ............................. 8 C. The Pattern of Recurrent Expenditures: 1962-1971 ............ ............................. 18 III. Issues in the Allocative Efficiency and Distributional Equity of the Tunisian Medical System ...... ................. .33 A. A Conceptual Framework for the Analysis of the Medical Referral System ......... ...................... 34 Characteristics of a Referral System ...... ........... .35 Evaluation of Referral Systems ...... ................ 37 B. The Referral Structure in Tunisia in Practice: Referrals to Higher Levels of the Pyramid ..... ............. .44 The Capacity for Referrals ......... ..................... .48 The Relative Probability of Access to Higher!Referral Units . .. 51 Case Mix Differences at Different Levels of the Referral Pyramid . 54 The Cost of the Specialty Care Option in the Referral System . .. 58 C. The Demand for Medical Service ........ .................... .60 Aggregative Trends in the Demand for Outpatient Services ....... .60 Microeconomic Factors Underlying the Demand for Medical Services . 67 Econometric Estimates of the Determinants of Demand .. ....... .. 72 The Congestion Problem: Policy Implications ..... ............ .74 D. Measures of Allocacive Efficiency within Existing Hospital Institutions ......... ....................... 77 E. The Incidence of Guvernment Medical Expenditure in Tunisia ............ ............................. .85 IV. Issues in Medical Manpower Policy: 1962-1971 ..... .............. .90 A. The Experiment in Socialization: The Policy of "Plein Temps"............ .......................... .90 B. The "Liberalization" of Medical Manpower Policy .... ........... .94 V. Conclusion ............... ............................... 101 ii LIST OF TABLES Table Number 1. Health Expenditures, Capital ani Recurrent for Selected Years 1962-1971 10 2. An Institutional and Regional Breakdown of Covernment Capital Expendi­ tures in Health for Selected Years 1962-':71 11 3. Total Investment Expenditure in the lie ]th Sector Between 1962-1971, by Institution, Region and Type of Investment 12 4. Capital Expenditure on Urban Water Su)plies: 1968-1972 14 5. The Implementation Rate of Health Inv. stment: By Function: 1962-1971 14 6. The Distribution of Hospital Beds by Regi:,: 1962,1971 17 7. The Density of Hospital Beds by District and Urban Areas: 1964, 1970 19 8. Recurrent Expenditure for Selected Years of Decade: 1962-1971; by Regional Institution 20 9. Total Recurrent Expenditure Per Hospital Bed, By Region: 1962-1971 22 10. Total Recurrent Expenditure by Region and Specific Program Activity: 1971 24,25 11. The Average Cost per Outpatient Consultation and Inpatient Day in Tunisia's Medical System: 1971 27 12. Distribution of Recurrent Health Expenditure, by Function: 1970 30 13. Measures of the Absorptive Capacity of the Tunisian Medical Referral System: 1971 47 14. The Absorptive Capacity of Different Tiers of the Medical Referral System in Kairouan, Sousse and Kasserine, 1971 49 15. The Absorptive Capacity of the Medical Referral System for Tubercu­ losis, Pediatrics and Opthalmology: 1971 50 16. The Representativeness of the Inpatient Population of Major Referral Hospitals in Terms of their Client Population: 1973 53 17. Case-Mix of a Sample of Inpatients in the General and Specialty Ser­ vices in a Sample of Tunisian Hospitals 56 18. The Level of Outpatient Demand: by Region: 1962-1971 61 19. Fraction of Population Consuming Outpatient Services for Selected Districts: 1971 64 20. Indices of Demand for Maternal-Child Health Services by Region: 1970­ 1971 65 21. Population per Doctor by District for Selectc.d Regions: 1970 66 22. Determinants of the Demand for the Services of Maternal-Child Health Centers 73 Table Number Page 23. Indicators of the Cost and Pattern of Resource Utilization in the Tunisian Hospital System 81 24. Determinants of the Pattern of Resource Utilization in Auxiliary and Regional Hospitals in Tunisia 84 25. Statistics on the National Distribution of Income and of the Income of C.N.S.S. (Social Security) Members 87 26. Share of Outpatient Consultations Received by Mnmbers of Social Security Systems 87 27. Sample Distribution of Hospital Inpatients by Income Category 89 28. Distribution of Physicians by Region; by Specialty, Nationality and Sector 92 29. Distribution of Private Sector Physicians by Region 97 An Analysis of the Structure, Equity and Effectiveness of Public Sector Health Systems in Developing Countries: the Case of Tunisia: 1960-1972 I Introduction At the time of its independence, Tunisia inherited a health and medical system totally inadequate to respond to the medical needs of its population or to attack the underlying causes of disease. Medical re­ sources---infrastructure and manpower--were in scarce supply and maidis­ tributed between the urban and rural areas. Between 1962 and 1971, Tunisia's government pursued policies to quantitatively and qualitatively expand the capacity of its medical and health system. This required sub­ stantial increases in the level of recurrent and investmaent expenditure, and measures to improve the allocative efficiency of the medical sy-tem. Many of these policies appeared highly innovative. Thu medical profes­ sion was "socialized." A network for rural dispensaries, staffed by physicians, was established. Fees for medical services were virtually eliminated. The problems Tunisia faced are not uacommon among otner develop­ ing countries. Since its policies are similar to those urged on the health planners of other LDCs, it is useful to evaluate their impact and efficacy. Did Tunisia's expanded health efforts remedy the peiceived structural inadequacies? Does the "referral pyramid" of medical and health institutiuns represent an efficient allocation of Tunisia's scarce medical and financial resources? In this paper we shall examine the structure of Tunisia's policies and of its medical and health system, and attempt to appraise whether they have been allocatively efficient and distributionally equitable. This requires two types of analysis. First, Tunisia's health policies over the decade must be described and examined for their impact on the structure of the medical and health system. -2- Secondly, an analysis must be made of the market for the medical services of the public sector. Is there efficiency in the production
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