GETTING BETTER EUROPE AND CENTRAL ASIA REPORTS mproving health system outcomes is a major development challenge for Europe and ICentral Asia (ECA). Fifty years ago, average lifespans in the region were slightly behind those in Western Europe, but far better than in East Asia, Latin America, or the Middle East. Since then, the gap between ECA and its western neighbors has widened, while the other middle-income regions have now all moved ahead. Some countries in ECA have performed very well, and the overall regional trend has recently improved, but long-term progress has certainly lagged behind the rest of the world. In the future, health sector issues are likely to loom ever larger in policy agendas across the region. Living a long, healthy life will increasingly matter to people as much as achieving ever-higher incomes. Opinion polls indicate that health is the top priority for government GETTING spending among populations across ECA, and expectations for a strong government role in the sector are high. Yet these aspirations must be reconciled with the reality of aging populations and significant fiscal constraints. BETTER Getting Better: Improving Health System Outcomes in Europe and Central Asia draws on a wealth of new evidence to explore the challenges facing health sectors in ECA. It highlights three Improving Health key agendas to help countries seeking to catch up with the world’s best-performing health systems. The first is the health agenda, where the main priority is to strengthen public System Outcomes in health and primary care to help achieve the “cardiovascular revolution” that has taken place elsewhere in recent decades. The second is the financing agenda, in which the growing Europe and Central Asia demand for medical care must be satisfied without imposing an undue burden on house- holds or government budgets. The third agenda relates to broader institutional arrangements, Smith • Nguyen where the task is to adopt some of the key ingredients common to most advanced health systems that are still missing in many ECA countries. A common theme for all three agendas is the emphasis on improving outcomes, or “Getting Better.” Owen Smith and ISBN978-0-8213-9883-8 Son Nam Nguyen SKU 19883 IBRD 34198R1 | DECEMBER 2012 This map was produced by the Map Design Unit of The World Bank. The boundaries, colors, denominations and any other information shown on this map do not imply, on the part of The World Bank Group, any judgment on the legal status of any territory, or any endorsement or acceptance of such boundaries. RUSSIAN FED. ESTONIA LATVIA CZECH POLAND LITHUANIA REP. BELARUS SLOVENIA SLOVAK REP. CROATIA HUNGARY BOSNIA AND RUSSIAN FEDERATION HERZEGOVINA UKRAINE MONTENEGRO SERBIA ROMANIA MOLDOVA KOSOVO ALBANIA BULGARIA FYR MACEDONIA TURKEY GEORGIA KAZAKHSTAN ARMENIA AZERBAIJAN UZBEKISTAN TURKMENISTAN KYRGYZ REP. TAJIKISTAN EUROPE AND CENTRAL ASIA This report is part of a series undertaken by the Europe and Central Asia Region of the World Bank. Earlier reports have investigated poverty, jobs, trade, migration, demography, and productivity growth. The series covers the following countries: Albania Latvia Armenia Lithuania Azerbaijan Moldova Belarus Montenegro Bosnia and Herzegovina Poland 0250 500 Kilometers Bulgaria Romania Croatia Russian Federation 0 250 500 Miles (accurate at 60°N) Czech Republic Serbia Estonia Slovak Republic FYR Macedonia Slovenia Georgia Tajikistan Hungary Turkey Kazakhstan Turkmenistan Kosovo Ukraine Kyrgyz Republic Uzbekistan GETTING BETTER GGB.indbB.indb i 222/05/132/05/13 77:28:28 PPMM GGB.indbB.indb iiii 222/05/132/05/13 77:28:28 PPMM GETTING BETTER Improving Health System Outcomes in Europe and Central Asia Owen Smith Son Nam Nguyen GGB.indbB.indb iiiiii 222/05/132/05/13 77:28:28 PPMM © 2013 International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org Some rights reserved 1 2 3 4 16 15 14 13 This work is a product of the staff of The World Bank with external contributions. Note that The World Bank does not necessarily own each component of the content included in the work. The World Bank therefore does not warrant that the use of the content contained in the work will not infringe on the rights of third parties. The risk of claims resulting from such infringement rests solely with you. The findings, interpretations, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or acceptance of such boundaries. Nothing herein shall constitute or be considered to be a limitation upon or waiver of the privileges and immunities of The World Bank, all of which are specifically reserved. Rights and Permissions This work is available under the Creative Commons Attribution 3.0 Unported license (CC BY 3.0) http://creativecommons.org/licenses/by/3.0. Under the Creative Commons Attribution license, you are free to copy, distribute, transmit, and adapt this work, including for commercial purposes, under the following conditions: Attribution—Please cite the work as follows: Smith, Owen, and Son Nam Nguyen. 2013. Getting Better: Improving Health System Outcomes in Europe and Central Asia. Washington, DC: World Bank. DOI:10.1596/978-0-8213-9883-8. License: Creative Commons Attribution CC BY 3.0 Translations—If you create a translation of this work, please add the following disclaimer along with the attribution: This translation was not created by The World Bank and should not be considered an official World Bank translation. The World Bank shall not be liable for any content or error in this translation. All queries on rights and licenses should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2625; e-mail: [email protected]. ISBN (paper): 978-0-8213-9883-8 ISBN (electronic): 978-0-8213-9884-5 DOI: 10.1596/978-0-8213-9883-8 Cover photo: © Ami Vitale / Panos Pictures. Used with the permission of Ami Vitale / Panos Pictures. Further permission required for reuse. Cover design: Naylor Design. Library of Congress Cataloging-in-Publication Data Smith, Owen. Getting better : improving health system outcomes in Europe and Central Asia / Owen Smith and Son Nam Nguyen. p. ; cm. — (Europe and Central Asia reports) Includes bibliographical references. ISBN 978-0-8213-9883-8 (alk. paper) — ISBN 978-0-8213-9884-5 I. Nguyen, Son Nam, author. II. World Bank, issuing body III. Title. IV. Series: Europe and Central Asia reports. [DNLM: 1. Quality Assurance, Health Care--organization & administration--Asia, Central. 2. Quality Assurance, Health Care—organization & administration—Europe, Eastern. 3. Delivery of Health Care—standards—Asia, Central. 4. Delivery of Health Care—standards—Europe, Eastern. 5. Health Policy—Asia, Central. 6. Health Policy—Europe, Eastern. 7. Quality Assurance, Health Care—economics—Asia, Central. 8. Quality Assurance, Health Care—economics—Europe, Eastern. W 84.4 GA3] RA418 362.1094—dc23 2013009644 Contents Foreword xiii Acknowledgments xv Abbreviations xvii Overview 1 A Development Challenge 2 The Health Agenda: Achieving a Cardiovascular Revolution 8 The Financing Agenda: A Safety Net for All—While Cutting the Fat 15 The Institutional Agenda: Ingredients, Not Recipes 22 References 25 1. Getting Better? In Search of Convergence 27 Some Successes, but Overall Slow Progress on Key Objectives 29 A Guide to the Report: Objective, Road Map, and Cross-Cutting Themes 37 References 42 2. Improving Welfare: The Value of Health 45 Health Is a Major Determinant of Welfare 47 Health Is a Public Priority Here to Stay 56 References 63 v GGB.indbB.indb v 222/05/132/05/13 77:28:28 PPMM vi Contents 3. Improving Health: The Heart of the Matter 69 The Main Source of the Life Expectancy Gap Is Cardiovascular Disease 72 Smoking, Drinking, Men, and Women: More Can Be Done to Address Tobacco and Alcohol Use 79 There Are Big Gaps in Managing Risk Factors through Primary Care 91 The Quality of Treatment and Care for Key Conditions Is Often Poor 99 References 104 4. Improving Financial Protection and Equity: A Safety Net for All 109 The Problem with Out-of-Pocket Payments: Conceptual Issues 111 A Greater Reliance on Out-of-Pocket Payments Results in More Catastrophic Payments and Higher Inequality 117 Better Financial Protection Depends on Adequate Health Budgets and Control of Rent Seeking 125 References 137 5. Improving Efficiency: Cutting the Fat 141 Judging Budgets: The Costs and Benefits of Government Health Spending 144 Hospitals and Pharmaceuticals Are the Main Sources of Waste 149 Cutting the Fat but Not the Muscle 154 References 158 6. Improving Institutions: Ingredients, Not Recipes 161 A Brief History of Health Reform in ECA since the Transition 163 Where Are We Now? A Comparison of ECA and OECD Health Systems 166 Ingredients, Not Recipes, for Successful Health Reform 175 References 182 7. Summary Q&A 185 GGB.indbB.indb vvii 222/05/132/05/13 77:28:28 PPMM Contents vii Boxes 1.1 A Brief Historical Tour of Health Trends in ECA: Different Countries, Time Periods, Narratives 32 1.2 A Note on Data Sources 40 2.1 What Is Better Health Worth? Introducing