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What does a “developed” health system look like?

Owen Smith's picture

SDM-TR-052 World Bank

It’s hard to say with much precision. Or at least that’s one of the main impressions you get when scanning a 2010 report on OECD health system institutional characteristics. The results are from a survey of 29 mostly high-income countries, based on responses to 81 questions about their health systems, including various aspects of financing, coverage, service delivery organization and governance. It is proving to be a useful reference point as we undertake a stock-taking of reforms across Europe and Central Asia.

The fact that there are many varieties of advanced health systems is hardly surprising, of course, but it runs much deeper than the old Beveridge vs. Bismarck dichotomy. How countries approach issues like coverage rules, facility ownership status and provider payment methods cannot be neatly divided into two groups. Once you look across a large number of characteristics and countries, similarities would seem to be the exception, not the rule.

They do appear to have some things in common, however, such as the use of health technology assessment, similar regulations for human resources, and measures to protect patient rights. (Although if we were to dig deeper than the questions asked in the survey, more variation would surely be uncovered here too).

Interestingly, only about half of Organisation for Economic Co-operation and Development (OECD) systems have embarked on what we might think of as ‘innovative’ reform agendas such as performance-related payment systems, publishing information on the quality of care or the widespread use of IT for exchanging information among providers.

What do the OECD’s heterogeneous approaches mean for our work to strengthen health systems in low- and middle-income countries (LMICs)? I am sure people have lots of ideas about drawing the right lessons. A few thoughts come to mind.

First, it is good to be open-minded about what kind of system is most appropriate for any particular LMIC. There is no obvious “best practice” health system to which all LMICs should converge. This is all the more true since if we were to look for rigorous empirical evidence about “what works” in terms of various institutional characteristics, we would probably be hard-pressed to come up with many clear verdicts.

On the other hand, presumably there has also been some learning going on in the OECD, and thus LMICs may be able to avoid approaches that are rarely found in advanced systems (e.g., line-item budgeting for hospitals), and at the same time they can get a head-start on more recent trends (e.g., the use of IT).

Finally, it is worth noting that there are fewer differences across the OECD when it comes to the big-picture outcomes that we really care about. Life expectancy is quite similar, and financial protection is usually very good. All the more reason to make sure that any reform agenda is linked to achieving objectives.


Submitted by Anonymous on
Great blog Owen. I found this paper thought-provoking too. You can go further in terms of potential insights about accountability arrangements, especially for PHC services. If you put together the indicators for how PHC is organized across the OECD, a clear pattern emerges. Mostly PHC is delivered by contracted private organizations (22 out of 28 of the countries). And, PHC is funded mostly via fee-for-service, capitation or a combination. Delivery of PHC services by salaried staff practicing in a public facility is increasingly rare. The relatively few systems which had such a set-up have moved away from that. More than half of Sweden's population is now covered by contracted PHC practices for example. Critically these contracting/reimbursement arrangements give patients signficant leverage. How? By having reimbursement flow to a) a provider they opt to be enrolled with (in systems with capitation); and, b) providers based on delivery of specific services. These arrangements give far more leverage to patients than the public ownership/ salaried staff models which are so common in developing countries. They also give more leverage to public funders (or social insurers) than under the public ownership/ salaried staff model. Through setting eligibility criteria for being reimbursed with public funds, public payers can ensure minimum quality standards, for example. Increasingly, they are tying portions of the public payment to provision of preventative and chronic care (there is a nice table on this in the OECD paper too). The few OECD systems (e.g. Greece, Hungary, Mexico) which still utilize the public ownership/ salaried staff model for delivering PHC face many of the same problems we see in our client countries (e.g. access problems, low responsiveness, informal user fees and by passing/ turning to private providers with private out-of-pocket payment). As you say, we should not be in the business of telling developing countries what organizational structures they should aim for in their health systems. But, nor should we fail to point out that most are focusing considerable effort on trying to "fix" PHC systems organized in a way that gives public funders little leverage over service provision, and, patients even less. And they are sticking to a model that is increasingly rare in well-performing health systems. At the very very least, we should consistently point out that the public ownership/ salaried staff model for delivery of PHC is absolutely not the default model which it is widely presented to be in global health circles.

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