Macroeconomics and Health (CMH)

Achievements through September 2004

The South East Asian Region (SEARO)

The Regional Office in South East Asia has been active in communicating to countries the relevance of the CMH Report. SEARO has established a dedicated Working Group to engage in disseminating the Report's findings, making policy decisions regarding implementing its framework in the countries, and providing support to countries in this effort. Inter-ministerial and intersectoral meetings involving donors, development agencies, NGOs, media, and academia, for disseminating the core messages of the CMH Report, preceded the work. A Regional Conference of Parliamentarians on the CMH Report was held in December 2002. The Report was also on the agenda of the recent meeting of the Regional Director with WHO Country Representatives, in April 2003. Earlier, the meetings of Health Secretaries and Health Ministers, held in April and September 2002, had the CMH Report on their agendas.

In conjunction with the above meetings, the Regional Office finalized the Country Guidelines for CMH Follow-up and a related document, Outline for a Strategic Framework and Investment Plan.

In response to country interest and need for support, SEARO organized the Regional Consultation on Macroeconomics and Health for the South-East Asian Region (SEAR). This meeting was held at the World Health House in New Delhi on 18-19 August 2003. The meeting brought together representatives from the Ministries of Health, Finance and Planning from 9 SEAR countries, including Bangladesh, Bhutan, India, Indonesia, Maldives, Myanmar, Nepal, Sri Lanka, and Thailand. Also, East Timor-Leste was represented by the head of the WHO office in that country. Other participants included WHO representatives from HQ, Region and Country level and representatives from the World Bank, Columbia University, and USAID.

The meeting provided the countries with a venue to discuss and share experiences and challenges in this process. Also, the countries had an opportunity to work with the WHO offices at all levels to discuss the support needed in terms of advocacy, technical work and building alliances with donor and development partners. Out of deliberations among countries, country status presentations, and outcomes of working groups, several considerations and challenges associated with planning and implementing a MH strategy were identified by the SEAR countries. These issues are the foundation of future coordination of efforts among countries, WHO offices, funding entities, and other partners.

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Bangladesh has made significant strides in improving the health of its citizens over the last two decades, including increasing life expectancy from 48 years to 61 years and decreasing total fertility rate from 6.3 to 3.3. Significant income-based inequality in health and in the provision of health services, however, continues to be an important issue. Bangladesh is currently participating in various poverty reduction and health promotion strategies in partnership with bilaterals, including developing a i-PRSP and receiving funding from the Global Fund for AIDS, TB and Malaria.

In this setting, Bangladesh plans to build on the available data and analyses done in conjunction with these initiatives and to supplement this information with further work on pro-poor planning and policy formation. The government is committed to a pro-poor health strategy that targets resources for priority health objectives and the Essential Services Package (ESP) within its new Health, Nutrition and Population Sector Programme (HNPSP, 2003-2006).

A successful advocacy workshop held by the Ministry of Health and Family Welfare and the WHO-Dhaka office in May 2002 and Ministerial representation at the Regional Conference on Macroeconomics and Health in August 2003 initiated the Bangladesh MH work. Currently, the Ministry of Health and Family Welfare is in the process of establishing a NCMH equivalent - the National Commission on MacroHealth and Poverty Strategy - with the Health Economics Unit of the acting as the secretariat.

A work plan has been developed for the Commission which emphasizes continued advocacy activities linking poverty and health, evaluation of the evidence available for a situational assessment and costing identified essential health interventions. These activities will continue taking into consideration government attention to recent severe flooding and political disturbances in Bangladesh.

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India is spending less than 1% of its gross national product on its health care budget, and private health spending, mostly in the form of out-of-pocket expenditures by families and individuals, accounts for 82.2% of total health expenditures. The 2002 Indian national health policy strongly advocates increased spending by the central government. The policy envisages raising health expenditures from 5.2% of GDP in 2001 to 6% of GDP by 2010, with government health spending increasing from 0.9% of GDP to 2% of GDP.

A well-received presentation on the CMH Report during the 2002 meeting of Health Secretaries and Health Ministers led the Government of India, in January 2003, to establish a National Commission for Macroeconomics and Health (NCMH), co-chaired by the Health and Family Welfare Minister and the Finance Minister. The objectives of the NCMH are to evaluate the impact of increased investments in health on poverty reduction and economic development and to formulate a long-term strategy for scaling-up essential health interventions, with a focus on the poor.

©WHO 2002/Pierre Virot

A sub-commission will function as the technical and operational arm of the NCMH, with the chair and Member Secretary already selected and the remaining spots to be filled by 1-2 economists and 1-2 public health specialists. The sub-commission will conduct meetings and hire consultants and experts as necessary.

The work of the NCMH has been slow to commence, but building on the momentum from the 2nd Consultation on Macroeconomics and Health in October, the NCMH technical sub-commission is developing a detailed work plan and budget for 2004, identifying the key issues for India and the resources that will be needed to adequately analyse these issues. The main areas of analyses that will go into the development of a Health Investment Plan include an assessment of the current health financing mechanisms and options for mobilizing additional resources, costing of an essential health services package, the role of the public and private sector in delivery of this package, and the implications of the HIV/AIDS epidemic. Overarching issues include monitoring and accountability, decentralization, inter-sectoral coordination, ensuring equity and economic development.

In coordination with the country, regional and HQ WHO offices, necessary linkages with technical groups and expertise from WHO and other institutions are being made to assist the NCMH in the identified analyses and assessments. The end product of the work of the NCMH sub-commission will be a report by October 2004 that will be the foundation of a Health Investment Plan, and further work will be undertaken to best ensure implementation and long-lasting effects of these recommendations.

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In 2000, total spending on health amounted to 1.6% of GDP in Indonesia, or about US$ 8 per person. Additionally, overseas development assistance (ODA) to Indonesia averages US$ 2.3 billion annually, of which only 6% is dedicated to the health sector. Many of Indonesia’s most significant health problems – tuberculosis, malaria, infant and maternal mortality, and malnutrition – are problems from which the poor suffer disproportionately. Indonesian children from the poorest families are nearly four times more likely than children from the richest families to die before their fifth birthday.

The government of Indonesia will integrate its health and development initiatives under an overall macroeconomics and health policy framework. The objectives of this framework are to 1) accelerate existing initiatives for pro-poor policy and funding commitments: CGI (Consultative Group of Indonesia, chaired jointly by the Coordinating Minister for Economic Affairs and World Bank), PRSP, etc.; 2) provide focused technical assistance to address systemic issues and integrate pro-poor priorities into policy processes; and 3) increase political commitment for health as a means of poverty reduction and economic development.

Within this framework and in the setting of fiscal decentralization and decreased economic growth, Indonesia aims to improve overall health status through policy development and corresponding financial commitments. To fulfil the health outcomes outlined within Healthy Indonesia 2010 and the MDGs, the Consultative Group on Indonesia Health Working Group, the Government of Indonesia and the donor community have agreed on a shared plan of work consisting of 6 objectives:

  • Reduce financial vulnerability to major medical expenses
  • Optimize the participation of private and NGO health providers in increasing coverage
  • Ensure pro-poor institutional environment under decentralization
  • Ensure sufficient resources to priority health programs (financial)
  • Ensure access for the poor (non-financial constraints), and
  • Ensure accountability by local government.

Indonesia, as part of its MH work, is in the process of completing several important areas of focused research including the completion of a book that conceptualises health and poverty and describes the place of health priorities within the PRSP, a report on costing essential health services, and an assessment of human resource distribution of health care workers. Additionally, studies have been contracted to review decision-making process for sectoral allocation and absorption issues and a review of public health expenditures.

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Nepal’s public expenditure on health as percentage of GDP per capita is approximately 1.06%. The trend has been a slight decrease in health sector allocations as compared to those in other sectors. By contrast, the allocations to the education and water sectors have increased. Investment in health has increased during the last 10 years from 2.1% to 5.2% of the overall government budget. Recent political instability, however, has slowed this trend.

Nepal has improved many national health outcomes, with expansion of Essential Health Care to about 70% of the population. Access to health care facilities and workers in its rural communities has significantly improved. However, geographical variations among other health indicators persist, with rural populations having poorer health outcomes. According to a recent situational analysis prepared by the Royal Tropical Institute (KIT) of Amsterdam, health financing stems mainly from taxes and users fees, with the poor bearing the brunt of these fees. There are significant resource gaps on the road to achieving MDGs.

In response to the CMH recommendations, a Sub-Commission on Macroeconomics and Health (SCMH), part of a National Commission on Sustainable Development, has been formed. The Sub-Commission is chaired by the Ministers of Health and Finance and is comprised of representatives from most of the ministries, the National Planning Commission and the private sector. The WHO Representative to Nepal and the WHO Health Planner have been in close contact with the Sub-Commission. The Sub-Commission has identified key activities and areas of research (including advocacy workshops, epidemiological profile of disease among specific populations, a study on private health expenditures, and developing a coordinated effort for health sector reform and poverty alleviation) needed to move forward the MH process. Some studies that are relevant to the work of the SCMH are being carried out by the Health Economics and Finance Unit of the Planning Division of the Ministry of Health, including pilot projects with Social and Community Health Insurance schemes and studies of private health expenditures.

Nepal has developed a work plan for the SCMH for 2004 and is collaborating with the Royal Tropical Institute (KIT) of Amsterdam to carry forward the initial situational analysis and the development of district level health investment plans. Within the context of a dynamic political situation, technical expertise to aid Nepal in the analyses of essential services delivery, human resources, and financing at the district level and to conduct accurate costing of the district investment plans will continue to be a priority.

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Sri Lanka

Sri Lanka has had well known and significant successes in the public health arena, including decreasing birth rates and death rates, increasing life expectancy to levels of developed countries and low infant mortality rates and maternal mortality rates. However, there are still significant disease challenges for Sri Lanka. Malaria, TB, and mental illness are on the rise and malnutrition is not under control. Sri Lanka is also addressing current human resources issues, such as a shortage of nurses and paramedics as well as the commitment by the government to absorb all graduating doctors through 2009.

In light of the existing health issues, Sri Lanka is assessing whether it is investing enough in health. Compared to other countries in the region and globally, Sri Lanka’s national health expenditure as a percentage of GDP (3.2%) is low. Sri Lanka is currently evaluating various strategies to mobilize funding for health, including the feasibility of private insurance, community financing, ear-marked taxes, and cost-containment strategies.

Sri Lanka formed a National Commission on Macroeconomics and Health (NCMH) in early 2003 to address health sector priorities, including mobilizing funding for health and the shortage of health care workers. The NCMH is co-chaired by the Minister of Health, Nutrition and Welfare and the Minister of Rural Economy and Deputy Minister of Finance and includes representatives from various ministries, the WHO Country Office, UNDP, the private sector and academia. The work of the NCMH is synergistic with Sri Lanka’s Poverty Reduction Strategy Paper (PRSP) and Vision 2010 –which formulated an economic development strategy calling for sustained 7 to 9 % annual GDP growth – in developing a long-term policy that highlights pro-poor health and development issues and achievement of the MDGs.

The NCMH is commissioning health financing studies on designing and costing a basic health care package for the poor, human resource planning and issues of decentralization. The NCMH has also commissioned a report entitled “Macroeconomics and Health Initiatives in Sri Lanka”.

The NCMH has developed a work plan for 2004, which will culminate in a needs-based ten-year investment plan and report of the NCMH, based on the studies summarised above and others looking at the economic implications of disease and scaling up interventions. Additionally, the Commission will focus on building the capacity for MH work at the central and provincial levels, including a potential National Centre in Macroeconomics and Health.

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Many in the government of Thailand believe that to achieve better health, a holistic approach, demanding strong support from non-health sectors, is crucial in overcoming health-related problems. The increasing roles of development banks in various structural adjustment programmes, including health, are evident in Thailand. Examples include the trend toward hospital autonomy and the public sector reform initiative.

In response to the CMH Report, the Ministry of Public Health of Thailand has set up a Working Group on Macroeconomics and Health, co-chaired by the Senior Advisor to the Ministry in Health Economics and comprised of 15 experts from the health, economic, and financing sectors. The Working Group has developed a proposal to set up a National Commission on Macroeconomics and Health (NCMH). It has been proposed that the NCMH be jointly chaired by the Health and Finance Ministers. A joint secretariat will be set up comprised of representatives from National Economic and Social Development Board (NESDB) and the Bureau of Policy and Strategy to develop a strategic framework for an investment plan targeting the MDGs.

The MH process for Thailand as defined by the Working Group consists of five steps: 1) Analysis of current situations and trends focusing on the poor and marginalized, 2) Diagnosis and prioritization of the main health problems, 3) Examination and evaluation of selected health interventions for cost-effectiveness and feasibility, 4) Development of a Strategic Framework and Investment Plan; and 5) Advocacy for mobilizing political support for integration of health into poverty reduction strategies. The Working Group has identified study on cost-effectiveness of interventions in the Thailand context in 15 diseases as a priority area of further study.