Public Ends, Private Means: Strategic Purchasing of Health Services

Overview

Great progress has been made in recent years in securing better access and financial protection against the cost of illness through collective financing of health care. Managing scarce resources effectively and efficiently is an important part of this story. Experience has shown that, without strategic policies and focused spending, the poor are likely to get left out. The use of purchasing to enhance public sector performance is well-documented in other sectors. Extension to the health sector of lessons from ...

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Overview

Great progress has been made in recent years in securing better access and financial protection against the cost of illness through collective financing of health care. Managing scarce resources effectively and efficiently is an important part of this story. Experience has shown that, without strategic policies and focused spending, the poor are likely to get left out. The use of purchasing to enhance public sector performance is well-documented in other sectors. Extension to the health sector of lessons from this experience is now successfully implemented in many developing countries.

'Public Ends, Private Means: Strategic Purchasing of Value for Money in Health Services' is part of a series of World Bank publications on ways to make public spending on health care more efficient and equitable in developing countries. It reviews the underlying economics in terms of agency theory, behavioral science, contract theory, transaction costs, and public choice theory. It provides a synthesis of the institutional environment needed for countries to shift to strategic purchasing, organizational incentives that need to be in place, and management capacity that needs to be strengthened. The volume is supplemented with a CD that presents six regional reviews of current resource allocation and purchasing (RAP) arrangements.

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Product Details

  • ISBN-13: 9780821365472
  • Publisher: World Bank Publications
  • Publication date: 4/17/2007
  • Series: Books Series
  • Pages: 436
  • Product dimensions: 7.00 (w) x 9.90 (h) x 1.20 (d)

Table of Contents


Foreword   Eyitayo Lambo     xiii
Acknowledgments     xv
Abbreviations and Acronyms     xvii
Introduction   Alexander S. Preker   Xingzhu Liu   Edit V. Velenyi   Enis Baris     1
Conceptual Framework for Implementing Strategic Purchasing of Quality Health Service     3
A Roadmap     5
References     10
Policy Framework     11
Political Economy of Strategic Purchasing   Alexander S. Preker   April Harding     13
A Historical Snapshot     14
The Nature of Government Failure     18
Theoretical Underpinnings     23
Trends in Public Sector Reforms     30
Application to Health Sector     31
"Make or Buy" Decision Grid     34
Policy Levers Available to Governments     36
Getting from Here to There     45
Notes     46
References     48
Policy Design in Strategic Purchasing   Alexander S. Preker   John C. Langenbrunner   Paolo C. Belli     53
Introduction     54
Key Policy Design Issues     55
Options for Reforming the Policy Design     56
Conclusions     64
References     65
The Organizational Structure of Purchasers   Alexander S. Preker   Edit V. Velenyi   Cristian C. Baeza   Melitta Jakab     67
Introduction     67
Organizations Matter     68
Application to Health Care Purchasing     72
Organizational Forms     75
Structural Configuration of Purchasers     81
Incentive Regime     92
Conclusions     97
Notes     98
References     98
Institutional Environment   Hernan L. Fuenzalida-Puelma   Reinhard R. Haslinger   Alexander S. Preker     103
Introduction     103
Rationale for Institutions     104
Purchasing Issues Requiring Institutional Reform     106
Scope of Institutions     111
Forms of Institutions     114
Levels of Institutions     117
Conclusions     122
Note     123
References     123
Stewardship, Governance, and Management   Alexander S. Preker   Reinhard R. Haslinger   Reinhard Busse   Magda Rosenmoller      125
Introduction     125
Management at Different Levels     127
Quality Performance     141
Conclusions     142
Annex: Managerial Challenges     144
Note     146
References     146
Economic Underpinnings     149
Agency Theory and Its Applications in Health Care   Xingzhu Liu   Anne Mills     151
Basic Concepts     151
Standard Agency Theory     153
Agency Problems and Their Origins     155
Alternative Payment Systems     159
Agency in Health Care     167
Note     176
References     176
Doctors' and Patients' Utility Functions   Xingzhu Liu   Anne Mills     179
Introduction     179
A Framework of Interactions between Patients and Doctors     180
The Patient's Utility Function     181
The Doctor's Utility Function     186
The Interaction between the Doctor's and Patient's Utility Functions and Its Implication for the Remuneration System     190
Note     193
References     193
Economic Models of Doctors' Behavior   Xingzhu Liu   Anne Mills      195
Introduction     195
The Doctor's Objective Functions     196
The Doctor's Supply Behavior     197
Doctors' Pricing Models     198
Analysis of Doctors' Behavior in China     201
Note     207
References     207
Economic Models of Hospital Behavior   Xingzhu Liu   Anne Mills     209
Introduction     209
Hospital Types     210
Hospital Objectives     213
Economic Models of Hospital Behavior     216
The Application of Hospital Behavior Models     228
Note     234
References     234
Motivation and Performance-Related Pay   Xingzhu Liu   Anne Mills     237
Introduction     237
Motivation Theories     238
Concepts and Methods of Performance-Related Pay     242
Performance-Related Pay in the Health Care Sector     248
Notes     255
References     256
Payment Mechanisms and Provider Behavior   Xingzhu Liu   Anne Mills     259
Introduction     259
Taxonomy of Payment Systems     260
The Current Payment Systems     261
Toward a Better Payment System     273
Note     276
References     276
Supplier-Induced Demand and Unnecessary Care   Xingzhu Liu   Anne Mills     279
Introduction     279
The Conceptual Framework of SID and UNC     280
Supplier-Induced Demand     284
Unnecessary Care     295
Toward Better Efficiency of Care     304
Note     306
References     306
The Organization of Publicly Financed Health Care Services   William Jack     311
Introduction     311
Purchasing Medical Care and Coordinating Services     312
Allocating Control and Cash-Flow Rights     313
Allocating Authority over Coordination and Medical Functions     315
Contracting with Nongovernmental Organizations     317
Some Examples of Contracting     318
Conclusions     319
Notes     320
References     321
Contracting for Medical Care: Providing Incentives and Controlling Costs   William Jack     323
Introduction     323
Types of Health Care Funding Mechanisms     324
Contracting and Asymmetric Information     325
Applying Contract Theory to the Purchase of Health Services     336
Competition and Regulation     343
Some Conclusions     346
Notes     347
References     348
Framework for Evaluation     351
Measuring Efficiency in Purchasing   Xingzhu Liu   Anne Mills     353
Introduction     353
Concepts of Efficiency     354
Measurement of Organizational Efficiency     359
Measurement of Social Efficiency     376
Note     381
References     381
About the Coeditors and Contributors     385
Index     393
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