Types of financing mechanisms for the delivery of family planning/reproductive health goods and/or services identified, tested, and/or officially adopted

 

Definition:

This indicator complements the indicator, Percent of government health budget allocated to family planning and reproductive health.

This indicator measures the "financing mechanism"-- any process that raises funds for family planning (FP) or reproductive health (RH) service provision. Examples of these mechanisms may include: fee for services, sliding fee scales, subsidized services through donor financing, and third-party payment mechanisms such as health insurance.

"Identified and tested" refers to actions that assess the feasibility and appropriateness of certain funding mechanisms for providing FP/RH services. To meet this indicator, a country or program must both identify and test a new financing mechanism as well as officially endorse the mechanism.

Program administrators mobilize resources through four main sources: direct government (central or local) financing, donor financing (including bilateral, multilateral, and private foundations), user fees, and third-party payment mechanisms such as health insurance. In the face of declining government and donor funding for RH, new (alternative) financing mechanisms such as user fees and health insurance take on added importance.

Data Requirements:

Information on type of financing mechanisms identified and/or tested and verification that it/they have been officially adopted. 

Data Sources:

Documents and meeting minutes; pilot tests; study results; policies; strategies.  Budgets and actual expenditure reports should be accessible to the public and evaluators. In addition, a line item for FP and RH funding in expenditure budget documents should exist at all levels of health expenditure reports.  Evidence of expenditures should also be available with invoices, staff rosters, etc. This indicator may involve a budget tracking exercise of FP and RH funds. Data sources can also include reports of donor funds that are allocated to FP and RH activities through implementing partners other than the government. Expenses incurred by the public in accessing FP and RH services through the private sector should also be measured.

Purpose:

This indicator measures the commitment of resources being allocated to FP and RH activities by the government, donors and the private sector. Funds for FP/RH services can be mobilized through four main sources: direct government (central or local) financing, donor financing, user fees, and third party payment mechanisms such as health insurance. This indicator highlights the importance of financial resource mobilization as an essential component of a national plan or policy.

Issue(s):

Not all new financing mechanisms are necessarily good. Adding a new mechanism like fee for service can be good if it increases available resources for FP/RH, or bad if it suppresses demand. Often economic barriers, such as high fees for services or high transportation costs, restrict access to health services. On the other hand, charging nominal fees for certain FP/RH services may increase demand for such services, because people may associate better quality of services or a greater need for those services with having to pay for them. National health budgets can demonstrate intentions, but expenditures may not be consistent with the budget. Expenditure data are, by definition, retrospective and there may be time lags of several years before accounts are reported and reconciled. Infrequent.

If there is no line item for FP and RH services, then that poses a challenge for the evaluators. Even in the presence of a line item, getting the true expenditure on FP/RH services can be a challenge. For example, if FP/RH services are integrated with other maternal and child health services or if the same providers provide multiple services or if the FP/RH budget is not itemized to clearly note where and how the money was spent. Evaluators should also analyze if there is a discrepancy between the allocated budget and the actual amount spent on FP and RH activities. In a decentralized health system, funds for health services can come from national and decentralized ministries, such as state, local, etc. Hence, the budget tracking exercise should take the various decentralized budgets into account. In societies where a huge proportion of health expenses are covered out-of-pocket, the evaluators will also need to include out-of-pocket and private sector expenditures when calculating the full cost of healthcare.

In terms of implementation, evaluators will need to distinguish between the testing of a new mechanism and the mechanism's success at increasing revenues without unduly depressing demand. Organizational willingness to test a variety of financing mechanisms signals a positive policy environment, even if the organization ultimately adopts only one or two of the mechanisms.