1. Community based health insurance Linking formal and informal mechanisms Valérie Schmitt-Diabaté, ILO/STEP Turin, 5 March 2008

2. Community based health insurance Linking formal and informal mechanisms 1.Phenomenon 2.Origins and causes 3.Characteristics 4.Advantages 5.Limits 6.Linkages

3. A global phenomenon in Africa, Asia, Latin America Important to track the extension => inventories –Landscape of Micro-insurance in the World's 100 Poorest Countries (2006) 78 million lives covered by Micro-insurance in the World's 100 Poorest Countries Prediction: at least 10% growth in 2007 and 100% growth over five years –ILO STEP 2003/2004 Inventories in 15 countries (11 Africa, India, Bangladesh, Philippines, Nepal) 1,9 million in Africa, 25,7 million in Asia - 2% population covered –Permanent inventory starting in 2007, conducted by ILO STEP and regional networks: La concertation, AMIN and ACYM Africa : www.conceration.org 1,9 million people covered in 13 countries but all the schemes have not yet answered the questionnaire (ex Mali or Rwanda, 1 single scheme !!)www.conceration.org Asia: coming soon on AMIN website www.amin-net.orgwww.amin-net.org Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / …

4. ILO STEP 2003/2004 Inventories

5. Weak in % of the total population Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … ILO STEP 2003/2004 Inventories

6. Sénégal Cotisations Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Permanent Inventory

7. Cotisation de 2000 FCFA par personne et par an, taux de recouvrement de 50%, périodicité mensuelle ou annuelle Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Permanent Inventory

8. Statutory social security schemes do not succeed in covering these populations –Mandate (ex: Cape verde) –Nature of informal & rural employment Workers not recorded and often not organized (difficult to reach them and to collect premiums) Income is unknown / not regular (no contracts or pay slips, no declaration of revenues to the fiscal administration) Self employed cannot rely on employer’s contributions Inefficiency & inequity of public health systems –Concentration in urban areas, focus on secondary HC –Under funding of health care supply notably primary health care Low quality (lack of consumables and equipments; drugs shortage; poor motivation; poor availability; corruption) –The rural poor cannot access level2&3 HC structures Financial barriers (out of pocket payments + transport costs..) and lack of connections Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / …

9. Consequence –According to the WHO, each year 100 million people fall into poverty due to sickness-related costs (out of pocket payments + ex post strategies such as sell of assets or indeptment which lead to lasting poverty) Result –Local initiatives of the civil society to answer health protection needs of those excluded Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / …

10. Shared characteristics Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … MechanismUse among others the mechanism of insurance Cover excluded (from SSS and private insurance schemes) Voluntary or automatic affiliation (not compulsory) Contributions < ability to pay or supplemented by other sources of funding Limited benefit package but responding to the priority needs and availability of HC services Administrative procedures (enrolment, premium collection) adapted to the context Target Affiliation Contribution Benefit package Administra- tion

11. Diversity Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Responsible organization HC providers, people’s led associations, trade unions, cooperatives, community, MFIs Organization models In house schemes, stand alone or belonging to a network Linked schemes with several stakeholders (TPAs, local / central governments, insurance companies …) Benefit packages From cardiac surgery to primary care NamesMicro-insurance, mutual health organizations, CBHIs … Associations, mutual health organizations, cooperatives, micro-insurance agents in a P-A model Legal status Several thousands to millionsSize Democratic or notGovernance Contributions from members, subsidies …Funding

12. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Small number of beneficiaries Organisations in starting-up or problematical phase High number of offered packages Non formal responsible organisation Medium size (number of beneficiaries) India Nepal The Philippines Senegal Mali Benin, Burkina, Tchad, Togo, Cameroon, Ivory Coast Target group: the poor Membership: non voluntary High number of beneficiaries Differences in contributions (linked to revenue) No membership conditions Small number of offered packages Capitation Annual contributions RO: Health care provider ILO/STEP 2003-2004 inventories : Principal Component Analysis (PCA).. towards a typology

13. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … CoverageAbility to reach the excluded (IE workers, agriculture workers …) and to identify the poorest Protection & Solidarity Real financial protection (prepayment and risk pooling) Access to health care Increased access to health care and utilization of HC services Prevention, education, health promotion Impact on health care supply Improved quality and availability Increased transparency of management (fee setting, billing, procedures) Adapted to the needs and local characteristics (organization, ability to pay, availability of HC services) ParticipationEmpowerment of excluded people, increased dignity EfficiencyCost effective benefit package (primary and maternal care) Contained transaction costs, short reimbursement delays, little incidence of frauds (social control) … Enhance local solidarity Advantages

14. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Coverage Protection & Solidarity Access to health care Environment Efficiency Small population covered (3% max) since voluntary membership, marketing complexity.. Reduced risk pools (exceptions) Low ability to pay => limited benefit packages Solidarity at the scheme’s level: -Between healthy and sick (but ceilings …) -Between rich and poor (flat rate contributions …) -Exclusion of the poorest (when no subsidies from the State) Non professional management / monitoring Absence of efficient information systems Limited by the weak capacity to negotiate with health care providers on a large scale (lack of bargaining power) Non conducive : -poorly adapted legal framework, -lack of State’s involvement, -inadequacy of health care supply Limits

15. To extend social health protection –Various actors: State Social security institutions CBHI schemes Micro Finance networks Cooperatives Private insurance companies HC providers –Various mechanisms social insurance, microinsurance, social assistance … none of these methods has emerged as a panacea These actors and mechanisms have comparative advantages towards the extension of social security coverage –They can complement each other (see example of CBHI and statutory schemes) => Concept of linkages : build strategies of extension that use respective advantages of these methods & actors, and develop synergies Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / …

16. Ability to cover IE workers? Affordability? Well suited benefits? Redistribution? Contracting power? Management & administrative procedures? Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Statutory SS schemes &CBHI schemes NO. Civil servants, workers in employment relationship of a certain level of formality YES. IE workers clustering around certain characteristics (occupational, regional) NO. Relatively high and shared by employers and employees YES. Low levels, corresponding to ability to pay Comprehensive But standardized benefit packages Limited scope and levels But well suited to priority needs YES. Linked with incomeNO. Flat rate contributions Risk pool, financial consolidation? YES. Big and geographical diversified risk pools Steady contribution income flows NO. Small and varying size of risk pool Income difficult to predict Computerized MIS, trained staff Low level of sophistication and training But high standardization, difficult to adapt to non standard groups But adapted to characteristics of target, low transaction costs, prevention of fraud YES. Contracting power and agree- ments at a national / regional scope LOCAL. Contracting power and agreements at the local level Policy planning Top down policy approachBottom up with / without policy support Comparative advantages  

17. The concept of linkages is not theoretical –Examples of linked schemes in India, China, Philippines, Laos, Rwanda, Senegal, Ghana, Colombia, Uruguay … Study ISSA AIM ILO –Country case studies (10) –Synthesis of the studies and drafted a typology –Disseminate the study and the concept First Social Security World Forum Moscow (Sept 2007) Technical workshops : –Bangkok, October 2007 –Turin, December 2007 and March 2008 –Planned workshops with ISSA in 2008 / 2009 –Support field experimentation Projects aimed at developing large scale linked schemes with high potential of coverage Role of GIMI / GESS Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / …

18. Country case studies. The Yeshasvini scheme Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Where?Karnataka, India Why?Dr Shetty, cardiac surgeon. It is possible to extend access to the most sophisticated health care services to the poor Benefits?1600 surgeries, OPD, normal deliveries, pediatric care during the first 5 days after birth, stabilization of defined medical emergencies requiring indoor treatment Decision makers? Board of 6 trustees (prominent state and private individuals); the chairman is the Principal secretary of the cooperative department Nb insured2.2 million people insured in 2007 Stake- holders Government of Karnataka (subsidies: +1/3 of income) Cooperative department (communication) Cooperative societies (enrolment) Cooperative banks (assist in premium collection) FHPL (claims settlement + network of hospital) 320 hospitals (health care provision) Premium120 Rs / person and year. Discount 15% family of 5. Low admin costs

19. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Governance With health care sector Linkages Country case studies. The Yeshasvini scheme Administration PREMIUMS Financial CASH LESS CO-CONTRIBUTION

20. Country case studies. Swasthya Bima Yajana Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Where? India, 17 States What? A subsidized national health insurance scheme for the BPL in India that will rely on health insurance projects in all the districts of the States of India. A new bill was introduced in parliament. Benefits? Nb insuredTarget : 300 million BPL Stake- holders Funding pattern Estimated annual premium: 750 Rs per family per year Government of India: 75% of premium + cost of smart card State Governments: 25% of the annual premium Each beneficiary pays: Rs. 30 / year as registration/renewal fee. Total sum insured Rs. 30,000/- per family per year Cashless attendance - All pre-existing diseases to be covered Hospitalization expenses, taking care of most common illnesses with as few exclusions as possible Transportation costs (limit of Rs. 100 per visit, overall limit of Rs.1000) Central government and States governments Health insurance projects including NGOs, TPAs, Insurance companies Why?Majority of the unorganized sector workers (93% of total workforce) are still without any social security coverage

21. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Governance / design / decisions With health care sector Linkages Country case studies. Swasthya Bima Yajana Administration Financial EDUCATION ENROLMENT PREMIUM COLLECTION FORMULATION OF PROJECTS MONITORING SUBSIDIES GUIDELINES MONITORING SUBSIDIES COMMUNITIES NETWORK HC PROVIDERS Town/village District level State level Country level IMPLEMENTING ORG. (NGO, COOPERATIVE, GOVERNMENT) STATE’S MOH TECHNICAL CELL INSURANCE Co CENTRAL GOVERNMENT TECHNICAL CELL Co contributions Information Cash less Claims 75% 25% TPA Network CIVIC INSTITUTIONS IMPLEMENTATION ADMINISTRATION

22. Country case studies. PhilHealth - KaSAPI Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Where? Philippines, 70% population covered by health insurance ie 62 million What? The Individual Paying programme (15% of all PhilHealth insured) targeting IE workers & the POGI / KaSAPI initiatives (2003 & 2005) Stake- holders Funding pattern Cooperatives, microfinance groups, NGOs, etc market the Philhealth scheme, register workers and collect contributions on behalf of Philhealth Philhealth is the insurance company Idea behind KaSAPI Rather than targeting individual households directly, would target groups (admin efficiency gains, limit adverse selection). The program offers a discounted premium when a group of a minimum level is enrolled under a contract with PhilHealth. An organized group qualifies for the group premium rate if at least 70% of the group size is enrolled in Philhealth and an even more preferential rate applies if at least 85% become members.

23. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Country case studies. PhilHealth - KaSAPI Members of Organized Groups                      PhilHealth NETWORK HC PROVIDERS Hospitalization OPC Claims processing With health care sector Linkages Administration Financial ORGANIZED GROUP EDUCATION/ IEC ENROLMENT PREMIUM COLLECTION OF CONTRIBUTIONS SUBMISSION OF REPORTS ID GENERATION CLAIMS PROCESSING AND PAYMENT OF BENEFITS GROUP PREMIUM RATE (discount // Nb of members)

24. Country case studies. Colombia Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Where? Colombia What? In 1993, Bill No100, reform including: Equity in access to health services Mandatory health insurance to everyone Comprehensive coverage (the POS of the mandatory health plan ; the POSS subsidized basket including 50% of the POS) Free choice of insurer and health care provider Shift from supply side subsidies to demand side subsidies + increase public hospitals efficiency Stake- holders Funding pattern ARS: ESS, Caisse de conpensation, EPS publiques, EPS privées FOSYGA, SISBEN Regional Entities, the State Networks of HC providers Solidarity contributions (24%) from members of the contributive regime Transfers from the Nation (69%) 10% was financed through regional sources for health care Population covered 19.5 million through the subsidized scheme 15 millions through the contributive regime Total 80% population in 2007 (28% en 1992)

25. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Governance / design / decisions With health care sector Linkages Country case studies. Colombia Administration Financial       EPS (insurer) REGIONAL ENTITY 12% income (2/3 employer, 1/3 employee) FOSYGA Equalization fund Keeps 1 UPC / insured Transfer of contribution – UPC* *UPC: value of the premium stipulated by legislation REGIONAL ENTITIES “solidarity point” SISBEN ARS (insurer) Assessment of level of poverty (1 to 6) STATE 24% 69%7% NETWORK HC PROVIDERS Level 1 or 2 Subsidy CONTRI- BUTIVE REGIME 15 million insured SUBSIDIZED REGIME 19.5 million insured POS POSS

26. Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / … Follow up: support field experimentation –ILO / STEP: partnering with key projects – Ghana, Rwanda, Senegal, India, Philippines, China, Colombia, etc. –ISSA –Other partners (ex: MACIF)

27. Follow up: role of GIMI / GESS Phenomenon / Origins and causes / Characteristics / Advantages / Limits / Linkages / …