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 |
|---|---|---|
| Chile: National Health Fund (FONASA) |
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FONASA transfers money to public health care providers through fee-for-service mechanisms for certain services and groups of services that are assigned a fixed value. The remainder of resources for health care services and facility maintenance in the public sector is transferred based on historical budgets, which tend to be antiquated and therefore undervalued. In terms of transfer mechanisms, FONASA funds are not transferred directly to the individual health care providers. Read full sectionFONASA transfers money to public health care providers through fee-for-service mechanisms for certain services and groups of services that are assigned a fixed value. The remainder of resources for health care services and facility maintenance in the public sector is transferred based on historical budgets, which tend to be antiquated and therefore undervalued. In terms of transfer mechanisms, FONASA funds are not transferred directly to the individual health care providers. Rather, funds are transferred to the regional health entity (under the purview of the MOH) for the geographical region where the provider is located. The regional health entity pools the funds for all public health care providers in the area and then is charged with determining the budget of each provider. FONASA also transfers funds prospectively to the regional health entities for primary care facilities through capitation mechanisms. These funds are based on a region’s health care needs and its disease burden. FONASA and the ISAPREs transfer funds to private providers on a retrospective fee-for-service basis. Private providers always receive funds through fee-for-service mechanisms, and they have no ceiling on income, regardless of whether the source of the funds is FONASA or an ISAPRE. National Health Fund (FONASA)Provider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Capitation FONASA transfers money to public health care providers through fee-for-service mechanisms for certain services and groups of services that are assigned a fixed value. The remainder of resources for health care services and facility maintenance in the public sector is transferred based on historical budgets, which tend to be antiquated and therefore undervalued. In terms of transfer mechanisms, FONASA funds are not transferred directly to the individual health care providers. Rather, funds are transferred to the regional health entity (under the purview of the MOH) for the geographical region where the provider is located. The regional health entity pools the funds for all public health care providers in the area and then is charged with determining the budget of each provider. FONASA also transfers funds prospectively to the regional health entities for primary care facilities through capitation mechanisms. These funds are based on a region’s health care needs and its disease burden. FONASA and the ISAPREs transfer funds to private providers on a retrospective fee-for-service basis. Private providers always receive funds through fee-for-service mechanisms, and they have no ceiling on income, regardless of whether the source of the funds is FONASA or an ISAPRE. |
| Korea, Rep.: National Health Insurance Program |
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Providers have historically been reimbursed by the regulated fee-for-service system since the beginning of the national health insurance program (NHIP). There is no difference between public and private providers from the health insurer side regarding fee schedules or reimbursement rates. The fee-for-service system has led to an increase in volume and intensity of services in the long run. However, because fee regulation is applied to all providers, both public and private, it has contributed to overall cost containment and a rapid extension of population coverage. South Korea has single pooled purchasing, and claim reviews and payments are centralized and monitored by the Ministry of Health and Welfare (MoHW). Read full sectionProviders have historically been reimbursed by the regulated fee-for-service system since the beginning of the national health insurance program (NHIP). There is no difference between public and private providers from the health insurer side regarding fee schedules or reimbursement rates. The fee-for-service system has led to an increase in volume and intensity of services in the long run. However, because fee regulation is applied to all providers, both public and private, it has contributed to overall cost containment and a rapid extension of population coverage. South Korea has single pooled purchasing, and claim reviews and payments are centralized and monitored by the Ministry of Health and Welfare (MoHW). In 1997 the government launched a Diagnosis Related Group Pilot program for voluntary participating health facilities. The pilot program showed positive impacts on the behavior of health providers, such as the reduction in the length of stay, medical expenses, the average number of tests and a decreased use of antibiotics. However, there is strong opposition from providers, which has blocked the extension of DRG as a provider payment mechanism throughout the country. The pharmaceutical dispensing was separated from prescribing in 2000. This bars pharmacists from selling antibiotics to customers without a prescription. As such, physicians are not allowed to dispense medicines. National Health Insurance ProgramProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service Providers have historically been reimbursed by the regulated fee-for-service system since the beginning of the national health insurance program (NHIP). There is no difference between public and private providers from the health insurer side regarding fee schedules or reimbursement rates. The fee-for-service system has led to an increase in volume and intensity of services in the long run. However, because fee regulation is applied to all providers, both public and private, it has contributed to overall cost containment and a rapid extension of population coverage. South Korea has single pooled purchasing, and claim reviews and payments are centralized and monitored by the Ministry of Health and Welfare (MoHW). In 1997 the government launched a Diagnosis Related Group Pilot program for voluntary participating health facilities. The pilot program showed positive impacts on the behavior of health providers, such as the reduction in the length of stay, medical expenses, the average number of tests and a decreased use of antibiotics. However, there is strong opposition from providers, which has blocked the extension of DRG as a provider payment mechanism throughout the country. The pharmaceutical dispensing was separated from prescribing in 2000. This bars pharmacists from selling antibiotics to customers without a prescription. As such, physicians are not allowed to dispense medicines. |
| Nigeria: National Health Insurance System |
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Patients are allowed to choose their primary provider from the list of accredited facilities, which includes both public and private providers. The provider network is used for access and secondary referrals, which acts to control costs and maintain viability of the system. Provider payment mechanisms are primarily determined by the National Health Insurance System (NHIS) Governing Council. Read full sectionPatients are allowed to choose their primary provider from the list of accredited facilities, which includes both public and private providers. The provider network is used for access and secondary referrals, which acts to control costs and maintain viability of the system. Provider payment mechanisms are primarily determined by the National Health Insurance System (NHIS) Governing Council. For private insurers, this is determined between HMOs and Providers, with oversight from the central government, and referral to specialist care follows guidelines that are managed accordingly. Decree 35 determined that the only lawful payment systems to be included in NHIS are capitation, fee-for-service, per diem, or case payment. A capitation system is the predominant form of provider payment used to pay primary healthcare facilities, while secondary and tertiary healthcare facilities are paid by fee for service and per diem. National Health Insurance SystemProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Capitation Patients are allowed to choose their primary provider from the list of accredited facilities, which includes both public and private providers. The provider network is used for access and secondary referrals, which acts to control costs and maintain viability of the system. Provider payment mechanisms are primarily determined by the National Health Insurance System (NHIS) Governing Council. For private insurers, this is determined between HMOs and Providers, with oversight from the central government, and referral to specialist care follows guidelines that are managed accordingly. Decree 35 determined that the only lawful payment systems to be included in NHIS are capitation, fee-for-service, per diem, or case payment. A capitation system is the predominant form of provider payment used to pay primary healthcare facilities, while secondary and tertiary healthcare facilities are paid by fee for service and per diem. |
| Philippines: PhilHealth |
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Provider payment methods differ based on the type of care delivered. Fee-for-service reimbursements are used for inpatient care, most day surgeries, and ambulatory procedures, while primary care providers are reimbursed based on a capitation system. Read full sectionProvider payment methods differ based on the type of care delivered. Fee-for-service reimbursements are used for inpatient care, most day surgeries, and ambulatory procedures, while primary care providers are reimbursed based on a capitation system. For TB-DOTS treatment, malaria care, deliveries, surgical contraception, and cataract surgeries, a case-based payment methodology is utilized. There is no formal system that sets fixed deductibles or co-payments for beneficiaries, but health care providers are allowed to “balance bill”, charging patients the balance between what PhilHealth pays and the total cost of care. This is atypical of most government health programs around the world and can lead to abuse by providers (e.g., overcharging) and thus limited access for the poorest. At the same time, balance billing allows providers additional cost recovery in the case that the reimbursement for services does not cover their cost. Quality: PhilHealth currently leverages internally developed quality standards. A new set of standards called the “PhilHealth Benchbook” was implemented starting January 1, 2010. The Benchbook was developed by PhilHealth with the assistance of various international health partners and several rounds of consultations with health providers. The previous and new quality standards are overseen by PhilHealth. The new quality standards focus on the following domains of quality of care: patient rights and organizational ethic, patient care, leadership and management, human resource management, information management, safe practice and environment, and mechanisms of improving performance. With the implementation of the new standards this year, hospitals can now be accredited for up to 3 years compared with the previous practice of annual accreditation. PhilHealth has accreditation staff who physically check and verify compliance. PhilHealth has also set peer review committees essentially composed of health care providers who review specific cases. PhilHealth has been planning to implement quality-based purchasing but has not executed on this plan as of December 2009. Performance-based Payment: PhilHealth has been developing incentive payments but this work has been focused on payment to health care professionals and not for health facilities. Doctors are usually independent free agents who ‘practice’ in hospitals. Even government physicians who are salaried are allowed to engage in private practice. Thus, PhilHealth payments are split for health professionals and health facilities and efforts to implement case payments essentially focus on bundling the payment for the health facilities. Among PhilHealth’s work in incentive-based payments is a scheme that has been piloted in 30 local government hospitals since 2002 but has not been scaled up. The scheme is called the Quality Improvement Demonstration Study (QIDS). It utilizes clinical vignettes to measure quality of care. If a hospital passes a set quality of care index score, the payment for physicians is increased. Clinical vignettes focus on the management of illnesses of children less than six years of age. Another incentive scheme is increased payment for health professionals practicing in areas where there is a lack of doctors. Claims Processing: The claims processing procedure is still a manual operation. Electronic claims submissions have long been planned but have not been implemented. Hospitals or members fill out claims forms that are then submitted to PhilHealth within 90 days from hospital or health facility discharge. Two forms are usually submitted: First, a form that documents who the member is and premiums paid; and second, a form that details the service provided. Claims are submitted to 17 regional claims processing centers. These centers initially review if the claims are eligible. Review is inputted manually with a number of data encoded into the claims processing information system. Once the claim is approved for payment, checks are prepared for the signature of regional heads. Electronic reimbursements have been planned but have not yet been implemented. PhilHealthProvider payment mechanisms Provider Payment Mechanisms: Fee-for-service, Capitation Provider payment methods differ based on the type of care delivered. Fee-for-service reimbursements are used for inpatient care, most day surgeries, and ambulatory procedures, while primary care providers are reimbursed based on a capitation system. For TB-DOTS treatment, malaria care, deliveries, surgical contraception, and cataract surgeries, a case-based payment methodology is utilized. There is no formal system that sets fixed deductibles or co-payments for beneficiaries, but health care providers are allowed to “balance bill”, charging patients the balance between what PhilHealth pays and the total cost of care. This is atypical of most government health programs around the world and can lead to abuse by providers (e.g., overcharging) and thus limited access for the poorest. At the same time, balance billing allows providers additional cost recovery in the case that the reimbursement for services does not cover their cost. Quality: PhilHealth currently leverages internally developed quality standards. A new set of standards called the “PhilHealth Benchbook” was implemented starting January 1, 2010. The Benchbook was developed by PhilHealth with the assistance of various international health partners and several rounds of consultations with health providers. The previous and new quality standards are overseen by PhilHealth. The new quality standards focus on the following domains of quality of care: patient rights and organizational ethic, patient care, leadership and management, human resource management, information management, safe practice and environment, and mechanisms of improving performance. With the implementation of the new standards this year, hospitals can now be accredited for up to 3 years compared with the previous practice of annual accreditation. PhilHealth has accreditation staff who physically check and verify compliance. PhilHealth has also set peer review committees essentially composed of health care providers who review specific cases. PhilHealth has been planning to implement quality-based purchasing but has not executed on this plan as of December 2009. Performance-based Payment: PhilHealth has been developing incentive payments but this work has been focused on payment to health care professionals and not for health facilities. Doctors are usually independent free agents who ‘practice’ in hospitals. Even government physicians who are salaried are allowed to engage in private practice. Thus, PhilHealth payments are split for health professionals and health facilities and efforts to implement case payments essentially focus on bundling the payment for the health facilities. Among PhilHealth’s work in incentive-based payments is a scheme that has been piloted in 30 local government hospitals since 2002 but has not been scaled up. The scheme is called the Quality Improvement Demonstration Study (QIDS). It utilizes clinical vignettes to measure quality of care. If a hospital passes a set quality of care index score, the payment for physicians is increased. Clinical vignettes focus on the management of illnesses of children less than six years of age. Another incentive scheme is increased payment for health professionals practicing in areas where there is a lack of doctors. Claims Processing: The claims processing procedure is still a manual operation. Electronic claims submissions have long been planned but have not been implemented. Hospitals or members fill out claims forms that are then submitted to PhilHealth within 90 days from hospital or health facility discharge. Two forms are usually submitted: First, a form that documents who the member is and premiums paid; and second, a form that details the service provided. Claims are submitted to 17 regional claims processing centers. These centers initially review if the claims are eligible. Review is inputted manually with a number of data encoded into the claims processing information system. Once the claim is approved for payment, checks are prepared for the signature of regional heads. Electronic reimbursements have been planned but have not yet been implemented. |
| India: Rajiv Aarogyasri |
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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 |
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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 |
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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. |
| Thailand: Universal Coverage Scheme |
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UCS uses capitation as the main provider payment mechanism. Initially, providers were given the option of receiving reimbursements based on either total capitation or capitation for outpatient services and DRG for inpatient services at the provincial level. However, due to the disincentive of paying providers for high-cost care and delays in case referrals, UCS began using a single payment system in 2003. Read full sectionUCS uses capitation as the main provider payment mechanism. Initially, providers were given the option of receiving reimbursements based on either total capitation or capitation for outpatient services and DRG for inpatient services at the provincial level. However, due to the disincentive of paying providers for high-cost care and delays in case referrals, UCS began using a single payment system in 2003. The current payment mechanism for UCS is a mixed system of risk-adjusted capitation for primary care, a DRG-based capped global budget, and fixed rate fees for some services. It should be noted that health promotion and prevention services for all Thai citizens are paid by the UCS. Universal Coverage SchemeProvider payment mechanisms Provider Payment Mechanisms: Capitation UCS uses capitation as the main provider payment mechanism. Initially, providers were given the option of receiving reimbursements based on either total capitation or capitation for outpatient services and DRG for inpatient services at the provincial level. However, due to the disincentive of paying providers for high-cost care and delays in case referrals, UCS began using a single payment system in 2003. The current payment mechanism for UCS is a mixed system of risk-adjusted capitation for primary care, a DRG-based capped global budget, and fixed rate fees for some services. It should be noted that health promotion and prevention services for all Thai citizens are paid by the UCS. |