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Health Systems Reform: Role for Russia-US Collaboration for Global Health

Health Systems Reform: Role for Russia-US Collaboration for Global Health

May 12, 2009: US-Russian Collaboration for Global Health

Center for Strategic and International Studies

1800 K St., NW, Washington, DC

Health Systems Reform: Role for Russia-US Collaboration for Global Health

Andrey Demin, M.D., Doctor of Political Sciences, President of Russian Public Health Association,

Professor of I.M. Sechenov Moscow Medical Academy, Moscow, Russia

andrey_demin@yahoo.com +7 919 760-2600

This paper consists of three parts:

I. Global background and health care reform agenda;

II. Russian health care reform challenges;

III. Possible directions for Russia-US collaboration for Global Health.

I. Global background and health care reform agenda

The main incentive for development of health care as a part of social security, has always been threat of social instability related to large scale deteriorations in health caused by epidemics, wars, dramatic natural and social changes, for example, industrialization and, most recently, by globalization, global energy, food, financial, employment, environmental and public health crises.

Response of the adequate ruling elites, aimed at populations, included introduction of social aid (1605), insurance (1883), programs of state guarantees (1918), usually supplemented by political repressions.

After 1991 (break up of FSU, disappearance of Soviet example of social security, new phase of globalization), new global trends emerged:

1. Advent of “new medieval age”, destruction of social security, fragmentation of medical care and development of multi-layer care, according to individual’s wealth and proximity to elites. Emphasis on social equity in care.

2. Increased division of global population into “the clean” and “the dirty” – increased flows of human capital, i.e. healthy, adequate, professionally and socially successful individuals to countries with higher standards of living and vice versa.

3. Transnational corporations and elites underestimate public health and health care, do not consider it as part of development agenda.

4. Converging development of health care systems of developed countries on the basis of market competition created and managed by the state.

5. Strengthening of leadership of developed countries in development and implementation of global public health and health care policy as part of global security, based on modern social, information and medical technologies, aimed first of all at management of “complex humanitarian emergencies.” These emergencies include global pandemics (avian flu, swine flu, etc.); uncontrolled large-scale migration in the context of political and economic instability, climate change. Unequal access to medical care and pharmaceuticals, global damage caused by transnational companies (tobacco, alcohol, junk food, etc.), illegal networks (terrorist, illegal drugs), etc. should also be mentioned in this context.

6. State sovereignty in health care and social security, especially in countries with ineffective health care management, unable to participate adequately in global regulation, is also subject to change, and this requires ensuring balance of interests of various countries. There is perceived need for international legislation on health care guarantees, currently absent.

7. Emergence of global scale socially responsible private sponsors. So far these are predominantly representatives of US businesses (Gates, Bloomberg, Ellison, Buffett, etc.), however representatives of other countries, including Russia, might be expected to join in.

8. Further decline of the role of UN (WHO), strengthening of global financial institutions, World Bank. More domination from bureaucrats, experts in management, economics and marketing compared to health care professionals in health care management. Inadequacy of global economic development agenda to public health and environmental realities.

9. Conflict between professional responsibilities of medical professionals, the progress, promising attainment of individual eternal life, and ability to pay.

10. Emphasis on medical technologies and pharmaceuticals, attempting to substitute lack of social improvements and poor standards of living and pay for work. A vivid example is high-technology perinatal care, often unable to correct impact of such social determinants as poverty, inadequate nutrition, access to information, motivation.

Ideas for health care reforms, prevalent and tested in many countries of the world in recent 30 years, are not numerous (A. Mills, 2006).

А. 1980s became an “Era of health care financing”. Interest was high towards the issues of payment for care. 1987 World Bank report emphasized that insurance can be a solution. This idea was taken by Russia and other countries of the FSU, and now there is disillusionment. During this period were also generated and tested ideas of decentralization and reform of health care ministries, vertical and horizontal organization of services, economic evaluation.

B. 1990s saw increased attention to the potential of private sector in health care, as presumably more effective, able to provide large part of total care. This idea was not confirmed in many parts of the world, including Russia.

This period saw emergence of main direction of health care reforms in developed countries – “new public management” based on competition of providers, organized and managed by the state. This idea is based on N.A. Semashko state system, cheap and easy to manage, ensuring universal right to health care, complemented by market competition between providers, which can be of any type of property. Discussion on which is better: private, insurance or state system went into history.

C. 2000s. Millennium Summit brought together leaders of 189 UN member-states. Urgent public health and health care issues were included in 3 of 8 UN Millennium Development Goals: Goal 4 – decreasing mortality of children, Goal 5 – improving mother care, Goal 6 – control of HIV/AIDS, malaria, TB.

UN (WHO) organized Commission on Macroeconomics and Health. It was chaired in 2000-2001 by US economist Jeffrey Sachs. He also used to be in 2002-2006 Director of UN Millennium Project and Special adviser to UN Secretary General on MDG[1].

The Commission determined 10 global public health priorities and 10 relevant technologies for their solution. Global Fund to control AIDS, TB and malaria was established, funded by G8 countries, as well as other global initiatives. Interest towards global regulation in health increased. New approach of Global Health policy and practice started to develop.

2000s also saw rising attention to the lack of health care funding, lack of effective population coverage with effective technologies, and limits for scaling up. Importance of “good governance”, equity, responsibility of governments increased. It became obvious how difficult is to develop and implement health care policy. Concept of evidence-based policies and practices appeared.

Among major health care reform topics discussed currently are: how to pay providers and health professionals, how to fund demand (conditional cash transfers, vouchers), how to evaluate large-scale programs, what is “implementation”.

Health care reform in developed countries focused in recent 20 years (J. LeGrand, 2006) on two issues: how to provide care and how to fund care. Currently preferred approach to provision is to rely on choice and competition; to funding - general taxation supplemented by small co-payments, with no exclusion. Developing incentives for patients and providers is important.

II. Russian health care reform challenges

There might be outlined at least 9 distinct periods in development of health care in Russia after 1917 until present with specific challenges (Demin, 2008).

From 1991 private insurance business started to dominate in health care development, and this domination is now being questioned as ineffective, unable to control demographic decline, resulting in rise of pay services, poor and inequitable access to services, dissatisfaction of health professionals, etc.

The current major issues are what should be the standard of free services guaranteed by the state, the future role of compulsory health insurance and private insurance, how to control pay services, and how resources and responsibilities should be divided between the Federal, regional and municipal levels of administration. Related issue is how to control and balance influence of special interest groups in the reform debate. Equality of citizens living in various territories is important. In 2007, actual tariff per insured person within Program of state guarantees (without consideration of Federal budget) was 1723,5 Rubles in Republic Ingushetiya and 26918,1 Rubles in Chukotskiy Autonomous Okrug.

There are plans to introduce pharmaceutical insurance, establish a system of pharmaceuticals supply based on state corporation, and also to merge agencies responsible for protection of consumer rights.

Since 1991, political importance of health care, first of all access to pharmaceuticals, and care for the old-age pensioners, has been rising, in the context of demographic crisis.

In 2004 the remains of the Soviet era social security were abolished within confiscation type reform, structural adjustment reform started. In 2004 Federal health ministry was merged with Ministry for social development, and since then Russian Federal health ministers are not medical doctors. In 2004-2007 Minister was M. Zurabov, formerly head of private medical insurance company, currently advisor to the President of the Russian Federation. Main obstacle to health care reform, according to Minister M. Zurabov (2006) is low pay for work in the national economy.

The current Minister T. Golikova (2007-) is economist who came from position of deputy Federal Minister of finance, responsible for the state budget. The Russian leadership is still looking for internal reserves in the health care system, in view of surplus of physicians and beds inherited from the Soviet period.

In 2006-7 National priority project on health care was implemented, emphasizing primary health care, preventive medicine (mainly vaccinations and health checks) and availability of high technology care (construction of high technology centers), enumeration of health care resources was started. However the aim of the project did not include attainment of better health indicators.

In the end of 2006 large scale corruption scandal started in Federal Compulsory medical insurance (CMI) fund.

Shortly afterwards pilot projects on health care reform, run by the Federal Fund for CMI began in 19 territories of Russia, and their experience reviewed in 2008 is used as the basis for country-wide health care reform. The following approaches to health care modernization were successfully tested in the pilot projects:

- Switch to one-channel or predominantly one-channel funding of health care institutions according to final results;

- Implementation of single standards of provision of medical care and standards of equipping;

- Implementation of elements of partial or full fund-holding (“money follows the patient”);

- Implementation of personified reporting of volumes of provided medical care in CMI system with payment on the basis of normative of financial expenses, calculated according to standard of medical care;

- Reforming pay for work according to volumes of provided medical care on the basis of coefficient of participation in work;

- Attempt to develop payment according to full tariff in inpatient institutions and per capita funding in out-patient institutions.

However in pilot project introduction of new standards resulted in considerable increase in costs of services. Proportion of pay services in various territories is 1-10%.

In 2008 system of payment to health care professionals was changed to improve efficiency of work; construction of network of perinatal care centers was started; extended National priority project included programs to control cardiovascular disease, traffic accidents, cancer, development of blood transfusion service.

According to Health and Social Development Ministry (2008), major challenges, necessitating modernization of health care in Russia:

- Poor quality of medical care;

- High proportion of pay medical services;

- Unequal accessibility of free high technology medical care to citizens of various territories;

- Dissatisfaction of citizens with the current system of implementation of their constitutional rights to free medical care and health protection.

Plan of health care reform includes:

- Improvement of the system of health care management: better quality of forecasts and effectiveness of planning health care resources, introduction of results-based budgeting, financial management;

- Creation of the system of management of quality of medical care, based on a single system of standardization and funding of medical care linked to volumes and quality of services;

- Modernization of the system of compulsory health insurance;

- Establishing institutes of protection of patients’ rights and insurance of professional liability of health professionals;

- Introduction of effective measures aimed at raising motivation of health professionals towards quality work, introduction of systems of payment, linked to quality and results of work;

- Ensuring further development of Russian science and production of medical equipment, pharmaceuticals, and modern medical technologies;

- Creating conditions and incentives for increasing investments of citizens and employers in health, high priority of health in the system of social values;

- Developing a competitive network of health care institutions for providing citizens with free medical care with introduction of single standards of medical care, list of equipment and staffing;

- Changing organizational-legal forms of health care institutions and providing state contracting for them;

- Interaction of the state and professional medical associations on accreditation of medical institutions and licensing of health professionals.

After 1992 depopulation became the main political issue. To resolve it the absolute priority is to support development of prevention, treatment and rehabilitation programs, health protecting legislation related to two top causes of demographic crisis in Russia – alcohol abuse and tobacco use.

Concept of demographic policy issued in 2001 and revised in 2008 until 2025, is a belated response to demographic challenge, including measures aimed at increasing birth rate, decreasing death rate and regulation of migration. All these approaches necessitate involvement of health care.

Currently preparation of draft Concept of development of health care till 2020 is being finalized, supporting demographic concept.

Thus the main challenge of health care reform in Russia is preventing demographic decline.

The new concept claims that to ensure sustainable socio-economic development of Russia, one of priorities of state policy must be preservation and promotion of health of population on the basis of development of healthy lifestyle and increasing accessibility and quality of medical care. Effective functioning of healthcare necessitates improvement of organizational system, availability of trained health professionals, development of infrastructure and resource supplies: financial, material-technical and technological (including informatization), normative-legal provisions.

Aims of the Concept:

By 2020 increase number of population up to 145 million, life expectancy up to 75 years, decrease infant mortality down to 7.5, maternal mortality down to 18.6, develop healthy lifestyles of population, including decreased consumption of tobacco and alcohol, increase quality and accessibility of medical care, guaranteed to the population. Thus health care system took up full responsibility for main health indices and many risk factors, related them to social determinants of health.

Goals of the Concept:

- Create conditions, possibilities and motivation for population to live healthy lifestyles[2];

- Improve system of organization of medical care;

- Set up state guarantees related to provision of free medical care to citizens;

- Improve provision of citizens with pharmaceuticals within outpatient services within system of CMI;

- Develop effective model of management of financial resources of the program of state guarantees;

- Increase qualification of medical professionals and create a system of their motivation towards quality work;

- Develop medical science and innovations in health care;

- Develop informatization of health care.

Two main directions of activities: Development of healthy lifestyle; Guaranteed provision of population with quality medical care.

Development of healthy lifestyles includes:

- Improvement of medical-hygienic training and education;

- Establishing an effective system of measures to control harmful habits;

- Provision of healthy nutrition;

- Development of mass physical culture and sports;

- Decreasing risk of impact of harmful environmental factors;

- Establishing a system of motivating heads of school education system towards health protection and development of healthy lifestyles among schoolchildren;

- Establishing a system of motivating citizens towards healthy lifestyles and participation in preventive actions;

- Establishing a system of motivating employers towards participation in health protection of employees.

This forms the basis of mass prevention of risk factors of NCD.

Guaranteed provision of population with quality medical care includes:

- Specific state guarantees of provision of free medical care;

- Standardization of medical care;

- Organization of medical care;

- Provision with pharmaceuticals;

- Ensuring a single staffing policy;

- Innovation development of health care;

- Informatization of health care;

- Modernization of system of financial supply for provision of medical care;

- Legal and normative regulation.

Principles of development of state guarantees of provision of free medical care:

- Legal regulation of provision of free medical care within program of state guarantees;

- Development of program of state guarantees for 3 years with annual reviews;

- Development of regional programs of state guarantees on the basis of program approved by the Federal government, establishing territorial financial normative;

- Linking financial indicators to quality of medical care.

Standardization of medical care envisages preparation of methodological guidelines and clinical protocols, orders of provision of medical care; standards of provision of medical care; medical-economical standards; list of vitally important pharmaceuticals; registry of inpatients.

III. Possible directions for Russia-US collaboration for Global Health

Support implementation of MDGs.

Support reconsideration of global development agenda with inclusion of sustainable health care.

Support global public health initiatives, including FCTC and development of similar global initiative on control of alcohol abuse.

Put forward initiative for drafting UN (WHO) Convention on Health Care, with participation of WTO, WB, G8, WFPHA, IANPHI, global philanthropies, setting agreed agenda, standard guarantees for all, making adequate health care an indivisible part of all investment and trade agreements and projects, activities of corporations, first of all transnational corporations, involving public-private partnerships and socially responsible global private sponsors, balancing public health and interests of insurance and pharmaceutical business. Introduce regulations for accessibility of pharmaceuticals and financial sustainability of health care systems. Increasing power of Ministries of health;

Advise global philanthropies on priority of health care;

Determine responsibility of the national governments, volume and cost of state guarantees, first of all in primary health care. Ensure development of mental care, rehabilitation care, health care in remote, sparsely populated areas, emergency health care, environmental health, preventive, anti-ageing, lifestyle health care, palliative care;

Support inclusion of health care into national security agendas;

Establish procedures for governments’ reporting on health care issues and progress. Introduce independent monitoring of health care with participation of civil society. Use experience of FCTC, complemented by civil society involvement;

Ensure monitoring of satisfaction and public opinion, democratization of health care, participation of civil society, opening information on health care to the public, including outcomes;

Establish Global Fund on Health Care Development;

Promote globally universal right to health care, combining Soviet experience of state responsibility and universal right with approaches of managed competition of providers of various property forms, increasing efficiency, developed in US;

Develop procedures for pooling health care sovereignty;

Deemphasize private health care approach;

Resolve the issue of catastrophic payments for health care;

Advance approaches to health care for migrants, unemployed, homeless, working populations;

Advance health care for global critical infrastructures staff, military and police;

Support selection of effective interventions, ensure and monitor effective coverage;

Promote exchange in technologies and equipment;

Develop procedures for registration and monitoring of technologies use;

Help develop local production of pharmaceuticals and equipment;

Establish global health care observatory and regional observatories;

Promote health information systems, GIS in health care, telemedicine, protection of personal information;

Prevent corruption in health care;

Ensure due consideration of ethical issues in health care and protection of patients rights;

Ensure participation of health care professionals in development of health care reform agenda as partners of economists and politicians;

Determine basic competencies of health professionals and on this basis review education;

Provide training of health professionals for specific regions, for example, Africa;

Overcome privatization of medical knowledge;

Introduce training in Global Health;

Prevent further development of defensive medicine;

Organize and support multi-language website on public health and health care progress in various countries, understandable for all, confirmed from independent sources, based on monitoring of health care systems, effectiveness, and satisfaction of populations;

Support applied research on social determinants of health, health care inequities, integration of health care system.

Draft Oath of Medical Professional of Global Age.



[1] Sachs is considered to be the author of “shock therapy”, advising Russian Government in 1990s, thus one of co-authors of “Russian mortality crisis.”

[2] From 1929 until late 1960s social determinants of health were greatly neglected, then till 2007 health issues were split into medical care and health protection.


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