The Joint Learning Network for Universal Health Coverage systematically documents the reforms of its member countries and other countries that have expanded health coverage through demand-side financing. The case studies contained in these pages are brief, comparative and modular in nature, describing the key highlights and technical features of each program.
Compare various dimensions of country reform efforts using our interactive tool.
| Program | Provider Payment Mechanisms | Provider payment mechanisms |
|---|---|---|
| Vietnam: Compulsory and Voluntary Health Insurance Schemes |
|
Although there has been some innovation in provider reimbursement over the past few years, fee-for-service (FFS) remains the dominant payment mechanism. Rates are set by the fee schedule, and have remained unchanged since the schedule was created in 1995. Read full sectionAlthough there has been some innovation in provider reimbursement over the past few years, fee-for-service (FFS) remains the dominant payment mechanism. Rates are set by the fee schedule, and have remained unchanged since the schedule was created in 1995. In light of concerns that FFS payments encourage providers to treat patients more than is clinically necessary, the Vietnamese government has begun exploring alternative methods of payment. Additionally, an incentive-based structure for providers has been put in place that has tied provider payment to the financial performance of the facility. The FFS rates were created by an interministerial commission consisting of representatives from MoH, the Ministry of Finance (MoF), the Ministry of Labor, War Invalids, and Social Affairs (MOLISA) and the State Price Commission (SPC). The fees in the schedule are a mixture of per-item charges and per diem rates, with ranges for each type, and variations according to the type of hospital (higher class hospitals being able to charge more). With the exception of the addition of 1,022 new procedures in 2006, fees have been unchanged since the major initiative of 1995, not even to adjust for inflation. However, the government plans to update the fee schedule to reflect current rates. Note that drugs prices are not regulated by VSS (though they are monitored), and providers have the scope, in practice, to levy unofficial charges. The New Health Insurance Law 2008 provides for several different provider payment methods, including FFS, capitation, diagnostic-related group (DRG) or other modes of payment. Innovation in provider payment remains a top priority for reforms to improve the health insurance system. Beyond fees, Vietnam has an incentive structure for providers tied to the financial performance of their facility. Under Decree 33/1995, providers had limited ability to retain a portion (30%) of gross revenues from user fees. However, under this system, opportunities for incentive payments are highly variable based on the facility and the population they serve, and this structure had high potential for creating further imbalances in the system. This incentive structure has since been replaced by Decrees 10/2002 and 43/2006, which allow hospitals greater discretion over financial operations, management of human resources, organization of services, and choices of services offered. By providing greater autonomy to facilities over the management of their costs and revenues, the government hopes to better align the incentives of providers (hospital staff) with the overall financial performance of the health facility. Contracting between VSS and a health care provider is normally done for providers who operate as a separate legal entity. In effect, these are limited to provincial, central, and district level hospitals. Commune Health Centers (CHC) and inter-commune polyclinics can provide services to insured members but they are supervised by District Health Centers (DHC) and hence they do not possess a legal entity status to operate a bank account. VSS therefore cannot contract directly with them but must coordinate commune level health service provision under the supervision of the DHCs. With regard to quality control, the VSS plays little to no role in overseeing the quality of care. They serve primarily as the bill-payer and general orchestrator of the system. There are currently no clinical guidelines enforced by the MoH or VSS, and there is no credible quality assurance mechanism. Providers are largely free to treat patients as they choose. Compulsory and Voluntary Health Insurance SchemesProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service Although there has been some innovation in provider reimbursement over the past few years, fee-for-service (FFS) remains the dominant payment mechanism. Rates are set by the fee schedule, and have remained unchanged since the schedule was created in 1995. In light of concerns that FFS payments encourage providers to treat patients more than is clinically necessary, the Vietnamese government has begun exploring alternative methods of payment. Additionally, an incentive-based structure for providers has been put in place that has tied provider payment to the financial performance of the facility. The FFS rates were created by an interministerial commission consisting of representatives from MoH, the Ministry of Finance (MoF), the Ministry of Labor, War Invalids, and Social Affairs (MOLISA) and the State Price Commission (SPC). The fees in the schedule are a mixture of per-item charges and per diem rates, with ranges for each type, and variations according to the type of hospital (higher class hospitals being able to charge more). With the exception of the addition of 1,022 new procedures in 2006, fees have been unchanged since the major initiative of 1995, not even to adjust for inflation. However, the government plans to update the fee schedule to reflect current rates. Note that drugs prices are not regulated by VSS (though they are monitored), and providers have the scope, in practice, to levy unofficial charges. The New Health Insurance Law 2008 provides for several different provider payment methods, including FFS, capitation, diagnostic-related group (DRG) or other modes of payment. Innovation in provider payment remains a top priority for reforms to improve the health insurance system. Beyond fees, Vietnam has an incentive structure for providers tied to the financial performance of their facility. Under Decree 33/1995, providers had limited ability to retain a portion (30%) of gross revenues from user fees. However, under this system, opportunities for incentive payments are highly variable based on the facility and the population they serve, and this structure had high potential for creating further imbalances in the system. This incentive structure has since been replaced by Decrees 10/2002 and 43/2006, which allow hospitals greater discretion over financial operations, management of human resources, organization of services, and choices of services offered. By providing greater autonomy to facilities over the management of their costs and revenues, the government hopes to better align the incentives of providers (hospital staff) with the overall financial performance of the health facility. Contracting between VSS and a health care provider is normally done for providers who operate as a separate legal entity. In effect, these are limited to provincial, central, and district level hospitals. Commune Health Centers (CHC) and inter-commune polyclinics can provide services to insured members but they are supervised by District Health Centers (DHC) and hence they do not possess a legal entity status to operate a bank account. VSS therefore cannot contract directly with them but must coordinate commune level health service provision under the supervision of the DHCs. With regard to quality control, the VSS plays little to no role in overseeing the quality of care. They serve primarily as the bill-payer and general orchestrator of the system. There are currently no clinical guidelines enforced by the MoH or VSS, and there is no credible quality assurance mechanism. Providers are largely free to treat patients as they choose. |
| Colombia: General System of Social Security in Health |
|
EPSs and EPSSs are free to establish payment levels and payment mechanisms for services that they purchase from providers. Both entities have used the fee schedules, adjusted for inflation, developed by the pre-reform public health plans as ceilings for price negotiations. As of 2008, provider associations were forcefully seeking the establishment of price floors by the MPS. Read full sectionEPSs and EPSSs are free to establish payment levels and payment mechanisms for services that they purchase from providers. Both entities have used the fee schedules, adjusted for inflation, developed by the pre-reform public health plans as ceilings for price negotiations. As of 2008, provider associations were forcefully seeking the establishment of price floors by the MPS. There are two payment mechanisms common to both EPSs and EPSSs. In general, preventive and primary care services are contracted on a capitation basis. Most specialist and hospital care, however, is paid for either on a fee-for-service basis or by a services package. The CR and SR enrollees must also pay copayments, which vary according to an individual’s income. CR copayments are charged according to salary income. Enrollees with salaries lower than 2 minimum monthly salaries (mms) have a maximum copayment of USD46.70 annually. The maximum copayment for enrollees with incomes in the range of 2-5 mms is USD 195.20 annually. Finally, enrollees with incomes greater than 5 mms have a maximum copayment of USD390.30 annually. SR copayments are set according to SISBEN category. The poorest enrollees, who are classified in category 1, pay co copayments. On the opposite end of the scale, enrollees classified in category 3 pay 10% of the service value. General System of Social Security in HealthProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Capitation EPSs and EPSSs are free to establish payment levels and payment mechanisms for services that they purchase from providers. Both entities have used the fee schedules, adjusted for inflation, developed by the pre-reform public health plans as ceilings for price negotiations. As of 2008, provider associations were forcefully seeking the establishment of price floors by the MPS. There are two payment mechanisms common to both EPSs and EPSSs. In general, preventive and primary care services are contracted on a capitation basis. Most specialist and hospital care, however, is paid for either on a fee-for-service basis or by a services package. The CR and SR enrollees must also pay copayments, which vary according to an individual’s income. CR copayments are charged according to salary income. Enrollees with salaries lower than 2 minimum monthly salaries (mms) have a maximum copayment of USD46.70 annually. The maximum copayment for enrollees with incomes in the range of 2-5 mms is USD 195.20 annually. Finally, enrollees with incomes greater than 5 mms have a maximum copayment of USD390.30 annually. SR copayments are set according to SISBEN category. The poorest enrollees, who are classified in category 1, pay co copayments. On the opposite end of the scale, enrollees classified in category 3 pay 10% of the service value. |
| Indonesia: Jamkesmas |
|
While the Jamkesmas benefit package is standardized at the national level, districts are able to set the reimbursement rates for various services based on local conditions. Though the scheme initially utilized a fee-for-service reimbursement mechanism Jamkesmas began transitioning to a DRG provider payment system in 2009. All hospitals are being incorporated into the DRG payment process by the end of 2010. Read full sectionWhile the Jamkesmas benefit package is standardized at the national level, districts are able to set the reimbursement rates for various services based on local conditions. Though the scheme initially utilized a fee-for-service reimbursement mechanism Jamkesmas began transitioning to a DRG provider payment system in 2009. All hospitals are being incorporated into the DRG payment process by the end of 2010. Jamkesmas has “verificators” in every network hospital. These verificators have been put in place to assure reimbursements are made only for documentable claims with a full medical record. Verificators process claims and send them electronically to the MoH. Verificators have standard review procedures which they follow to document every case. These standards were developed by the MoH. Once the MoH receives the claim, it begins the reimbursement process to providers. While there has been broad experience with contracting public and private providers through the publically-funded schemes, the contract mechanisms have not used reimbursement or payment policies strategically to drive improvements in quality or efficiency. There are examples in maternal health where the current reimbursement system by Jamkesmas has created the wrong incentives for providers, such as not reimbursing midwives for pre-delivery care if there is post-partum hemorrhage. In addition, once a patient is referred to the hospital, the hospital receives a full reimbursement for delivery, while the midwife receives no fee, thereby discouraging midwives from referring patients to hospitals for complications as they would lose income. JamkesmasProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Diagnosis-Related Groups While the Jamkesmas benefit package is standardized at the national level, districts are able to set the reimbursement rates for various services based on local conditions. Though the scheme initially utilized a fee-for-service reimbursement mechanism Jamkesmas began transitioning to a DRG provider payment system in 2009. All hospitals are being incorporated into the DRG payment process by the end of 2010. Jamkesmas has “verificators” in every network hospital. These verificators have been put in place to assure reimbursements are made only for documentable claims with a full medical record. Verificators process claims and send them electronically to the MoH. Verificators have standard review procedures which they follow to document every case. These standards were developed by the MoH. Once the MoH receives the claim, it begins the reimbursement process to providers. While there has been broad experience with contracting public and private providers through the publically-funded schemes, the contract mechanisms have not used reimbursement or payment policies strategically to drive improvements in quality or efficiency. There are examples in maternal health where the current reimbursement system by Jamkesmas has created the wrong incentives for providers, such as not reimbursing midwives for pre-delivery care if there is post-partum hemorrhage. In addition, once a patient is referred to the hospital, the hospital receives a full reimbursement for delivery, while the midwife receives no fee, thereby discouraging midwives from referring patients to hospitals for complications as they would lose income. |
| Rwanda: Mutuelles de Sante |
|
The health insurance system in Rwanda has two main channels for financing: the demand side – the insurance programs, and the supply side – transfers from the treasury to districts and health facilities. On the demand side, services are financed through three main channels: demand-based user payments, demand-based payments from Mutuelles, and demand-based payments from RAMA and MMI. Read full sectionThe health insurance system in Rwanda has two main channels for financing: the demand side – the insurance programs, and the supply side – transfers from the treasury to districts and health facilities. On the demand side, services are financed through three main channels: demand-based user payments, demand-based payments from Mutuelles, and demand-based payments from RAMA and MMI.
On the supply side, financing flows from the central government towards health providers through multiple block grants, which provide hospitals with greater degrees of autonomy. A key issue on the supply-side financing is the equity of the needs based transfers against the historical criteria. The government hopes to progressively move towards increasing the importance of needs-based transfers and decreasing historical transfers.
A key issue on the supply-side financing is the equity of the needs based transfers against the historical criteria. The government hopes to progressively move towards increasing the importance of needs-based transfers and decreasing historical transfers. In addition, the substantial amount of donor funding incurs high overhead costs and involves a lack of clarity. Mutuelles de SanteProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Capitation The health insurance system in Rwanda has two main channels for financing: the demand side – the insurance programs, and the supply side – transfers from the treasury to districts and health facilities. On the demand side, services are financed through three main channels: demand-based user payments, demand-based payments from Mutuelles, and demand-based payments from RAMA and MMI.
On the supply side, financing flows from the central government towards health providers through multiple block grants, which provide hospitals with greater degrees of autonomy. A key issue on the supply-side financing is the equity of the needs based transfers against the historical criteria. The government hopes to progressively move towards increasing the importance of needs-based transfers and decreasing historical transfers.
A key issue on the supply-side financing is the equity of the needs based transfers against the historical criteria. The government hopes to progressively move towards increasing the importance of needs-based transfers and decreasing historical transfers. In addition, the substantial amount of donor funding incurs high overhead costs and involves a lack of clarity. |
| India: Rajiv Aarogyasri |
|
Providers are paid on a by-intervention basis, where a specified rate is set by Aarogyasri Trust in consultation with medical experts. For each approved procedure, the payment covers the entire cost of treatment, from the date of admission to discharge, as well as a maximum of 10 days after the discharge and any complications while in the hospital. The package rate includes consultation, medicine, diagnostics, implants, food, cost of transportation, hospital charges, and post-operative hospital stay. Read full sectionProviders are paid on a by-intervention basis, where a specified rate is set by Aarogyasri Trust in consultation with medical experts. For each approved procedure, the payment covers the entire cost of treatment, from the date of admission to discharge, as well as a maximum of 10 days after the discharge and any complications while in the hospital. The package rate includes consultation, medicine, diagnostics, implants, food, cost of transportation, hospital charges, and post-operative hospital stay. A comprehensive list of benefits and associated payment pricing can be found on the Aarogyasri web site. Seeking care is truly cashless for the patient. On the back-end, the provider must submit a pre-authorization to the insurance company (Aarogyasri I procedures) or to Aarogyasri Healthcare Trust (for Aarogyasri II procedures). The insurance company/Trust appoints medical officers who work on pre-authorizations. After pre-authorization and treatment, the insurance company or Trust (depending on which Procedure the beneficiary was enrolled in) will settle claims from hospitals within seven days of receipt of claim, discharge summary, and a satisfaction letter from the patient. To prevent fraudulent claims, the claim settlement history of each hospital is scrutinized and reviewed by the Trust at regular intervals. In addition, the insurance company recruits specialized doctors, known as vigilance officers, for regular inspection of hospitals. These specialists also attend to complaints from beneficiaries directly or through Arogya Mithras for any deficiency in services reported. The specialists also to ensure proper care and counseling for the patient at network hospitals by coordinating with Aarogya Mithras and hospital authorities. Rajiv AarogyasriProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Diagnosis-Related Groups Providers are paid on a by-intervention basis, where a specified rate is set by Aarogyasri Trust in consultation with medical experts. For each approved procedure, the payment covers the entire cost of treatment, from the date of admission to discharge, as well as a maximum of 10 days after the discharge and any complications while in the hospital. The package rate includes consultation, medicine, diagnostics, implants, food, cost of transportation, hospital charges, and post-operative hospital stay. A comprehensive list of benefits and associated payment pricing can be found on the Aarogyasri web site. Seeking care is truly cashless for the patient. On the back-end, the provider must submit a pre-authorization to the insurance company (Aarogyasri I procedures) or to Aarogyasri Healthcare Trust (for Aarogyasri II procedures). The insurance company/Trust appoints medical officers who work on pre-authorizations. After pre-authorization and treatment, the insurance company or Trust (depending on which Procedure the beneficiary was enrolled in) will settle claims from hospitals within seven days of receipt of claim, discharge summary, and a satisfaction letter from the patient. To prevent fraudulent claims, the claim settlement history of each hospital is scrutinized and reviewed by the Trust at regular intervals. In addition, the insurance company recruits specialized doctors, known as vigilance officers, for regular inspection of hospitals. These specialists also attend to complaints from beneficiaries directly or through Arogya Mithras for any deficiency in services reported. The specialists also to ensure proper care and counseling for the patient at network hospitals by coordinating with Aarogya Mithras and hospital authorities. |
| India: RSBY |
|
Providers are paid on a fee-for-service basis, with packages defined for each of the covered procedures and interventions. Claims submission and processing is cashless, allowing hospitals and insurers to submit claims and payments online. Read full sectionProviders are paid on a fee-for-service basis, with packages defined for each of the covered procedures and interventions. Claims submission and processing is cashless, allowing hospitals and insurers to submit claims and payments online. The process for reporting and paying claims is designed to be simple and cashless from the perspective of the provider and beneficiary. In general, the process looks as follows:
At present there are no quality standards being utilized by RSBY, but the national team is working with states and insurers to develop an incentive based quality management system for providers (e.g., a system where hospitals are graded according specific quality parameters and hospitals with better quality are paid at a higher rate by insurers). RSBYProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Diagnosis-Related Groups Providers are paid on a fee-for-service basis, with packages defined for each of the covered procedures and interventions. Claims submission and processing is cashless, allowing hospitals and insurers to submit claims and payments online. The process for reporting and paying claims is designed to be simple and cashless from the perspective of the provider and beneficiary. In general, the process looks as follows:
At present there are no quality standards being utilized by RSBY, but the national team is working with states and insurers to develop an incentive based quality management system for providers (e.g., a system where hospitals are graded according specific quality parameters and hospitals with better quality are paid at a higher rate by insurers). |
| Mexico: Seguro Popular |
|
The interventions included in the CAUSES are paid for by capitation. Meanwhile, the interventions carried out under the FPGC are paid for on a per-case basis. The payment mechanism for contracts with private providers is vague. The reform stated that health services should be provided by state health secretariats in accordance with the state of residence of the insured family or by other public health institutions that have contracted with the state health secretariats. After the passage of the law, however, the executive branch issued a by-law that introduced the option of contracting with the private sector. The problem with this by-law is that it does not specify the form that payments to private sector will take. Thus, such payments take place on an ad-hoc, non-systematic basis. Read full sectionThe interventions included in the CAUSES are paid for by capitation. Meanwhile, the interventions carried out under the FPGC are paid for on a per-case basis. The payment mechanism for contracts with private providers is vague. The reform stated that health services should be provided by state health secretariats in accordance with the state of residence of the insured family or by other public health institutions that have contracted with the state health secretariats. After the passage of the law, however, the executive branch issued a by-law that introduced the option of contracting with the private sector. The problem with this by-law is that it does not specify the form that payments to private sector will take. Thus, such payments take place on an ad-hoc, non-systematic basis. Seguro PopularProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Capitation, Diagnosis-Related Groups The interventions included in the CAUSES are paid for by capitation. Meanwhile, the interventions carried out under the FPGC are paid for on a per-case basis. The payment mechanism for contracts with private providers is vague. The reform stated that health services should be provided by state health secretariats in accordance with the state of residence of the insured family or by other public health institutions that have contracted with the state health secretariats. After the passage of the law, however, the executive branch issued a by-law that introduced the option of contracting with the private sector. The problem with this by-law is that it does not specify the form that payments to private sector will take. Thus, such payments take place on an ad-hoc, non-systematic basis. |