How do you manage free-of-charge in a system of revolving funds? How do you strengthen community capacity?
Cambodia:
Free drugs is provided by the government. Now, drugs are paid for by government inputs as well as drug fund inputs. We Will start revolving the drug funds in 1997. Regarding strengthening, one of the key means for the Cambodian government is to form committees and have them quickly involved in health services.
Laos:
One of your goals for community strengthening is to improve community self-medication. What does that mean?
Cambodia:
All around the world, this is an unavoidable problem. What can we do about it? Give people information to help themselves reduce the problem.
Moderator:
What he's basically saying is that there is a certain level of self-medication carried out in all communities. Because it cannot completely be eliminated, the best thing to do is to provide as much information as possible so that it is at least based on some information rather than none. This is a very critical issue that has to be looked at everywhere. The more you start looking at the private sector, the more you start looking at the penetration of drugs into rural areas. With insufficient backup support and health infrastructure, self-medication is going to increase because of the perception that the more you put into your body, the more likely you are going to get better quickly. It is a major issue, and I think WHO is concerned about it as part of the Drug Action Programme. UNICEF and other agencies must carefully consider how to deal with the issue of self-medication, understand its extent, look at what other issues are involved, and what steps need be taken, I think Cambodia's presentation is recognizing that you cannot eliminate or eradicate self-medication.
Chairman:
Another aspect of self-medication is affordability. According to Andrew Morris's report, people are spending about US$19 for it. Misinformation is very important in terms of affordability of drugs for each person.
Cambodia: (Morris)
Looking at household health expenditure patterns, a lot of people are spending a lot of money on unnecessary medicines. If we don't start looking at that issue, we are going to miss an opportunity to try to reduce this unnecessary household expenditure. The link with revolving drug funds is very important, because it's very easy for us to think that at the village level or health center level, people are going to come in and demand essential drugs. In fact, they won't. Unless we do something to help them understand the role of essential drugs and good medication practices, they are going to come and demand injections and unnecessary medication. In Cambodia, the effort needs to be focused on the links between revolving drug fund success, essential drug availability, and balancing the demands of the local population.
Moderator:
The Vietnam experience has brought that point out. Community education must recognize that that proper use differs from rational use. A consequence of effective revolving drug funds is that community education in the proper use of medication is emerging as a priority. It's an issue that needs to be looked at or anticipated, especially in countries thinking about scaling up, about looking at things on a more national basis, or about strengthening capacity.
II. Laos
Cambodia:
What is the government policy regarding national commitment to drug funds? From where do revolving drug funds receive drugs? Is there a government policy on financing?
Laos:
Now the policy is to increase the national budget in the next five years. We plan to increase the national health budget for health services, including drugs, from 3.5% to 8%. About 50% of the drugs for our revolving drug funds are purchased from local manufacturers. The rest we buy from importers.
Vietnam:
How are RDFs managed at hospitals at the provincial level? At all levels?
Laos:
Our policy is decentralization down to the province. Each province has to submit its drug needs, which is sent to the MOH for verification that the drugs are on the drug list. After that, the list is sent to local drug procurers who send the products directly to the province concerned
Moderator:
Quite often, the emphasis is down on the district and sub-district levels. Yet, what underpins and supports the sub-district and community levels is the district level hospital, which is the most visible expression of the health care delivery system in many countries. Though much of our efforts are focused on the community and sub-district levels, we see little strengthening because prescriber practices being followed at those levels reflect the practices at the district and provincial levels. Community level personnel, when they go for their in-service training or when they get an opportunity to go to the districts and provinces, are exposed to doctors and senior health workers who prescribe on the basis of the way the treatment is being provided at the district level. There is a gap between national policy and implementation at the community and sub-district levels. You're trying to support a new approach for rational drug use, yet in the most dominant part of the health care delivery system--the district and provincial hospitals--very little is targeted. The same thing happens with revolving drug funds. It is a critical issue that is beginning to emerge. While it is good to focus on the community because they are disadvantaged, rural and remote areas, we need to provide some support to the districts. That's why it's very important to ask how the districts and provinces are actually managing their RDFs.
Laos:
In regard to these duties, we have to recentralize. The provincial pharmacy has a team working on drug supply and on evaluation of drug use. The provincial drug team trains the district personnel in charge of the drug supply.
MSH:
Is there a standard pricing policy, or is it up to each community to set its own prices? I guess the same question applies to Cambodia. Who decides whether patients get free drugs, and what percentage of patients actually get free drugs?
Laos:
We have to discuss this again. I asked our Cambodian friends how they manage to do free-of-charge and which persons are exempted because we cannot solve this problem.
Chairman:
Vietnam's drugs are revolving. You have a successful case, where you have established a purchasing and replenishment system. You mentioned decentralization to the province. In the purchasing and replenishment system, do you delegate authority to the province and district level for everything? What kind of authority to you delegate to the province and district levels? In other words, where is the revolving system better-at the national, provincial, or district level?
Vietnam:
We have a national drug distribution network, and three major national drug companies located in three main areas: North, Central and South. We have also decentralized authority to the provincial level. Each province has its own company, and some provinces also have drug production facilities. By this network, drugs can be supplied to all districts and communities.
Moderator:
You have a distribution network that is basically set up through these companies that you described, but you also delegate considerable authority to the provinces and districts in that they are able to purchase their drugs in accordance to their particular needs. This is a bicameral approach, a twin approach: a decentralized distribution system with the locus of control at the provincial level, and freedom for the provinces and districts to purchase drugs within the budget provided to them, with the funds obtained from drug sales and within certain guidelines. The guidelines are where there is weakness. Issues such as where money needs to be spent and rational use need further clarification.
Vietnam:
Before 1989, before the new market economy, districts and communities had to buy drugs in their localities. For example, districts belonging to a particular province had to buy drugs from within that province. Since 1989, reflecting the new market economy, districts are now allowed to purchase drugs from anywhere within the system, wherever they can get the best prices.
Moderator:
Laos, what is the extent of the authority provided to the provinces?
Laos:
We decentralize much to the provinces, but each province should respect the limits of the essential drug list. They have to purchase drugs from local manufacturers first before going to the national level.
Moderator:
Your local manufacturers are not private; they are all government subsidiaries except for one private company. So basically, purchases are from government subsidiaries that are locally positioned in the various provinces. The provinces are supposed to use the budget. There is a flexibility in how much they want to buy as long as they buy from the local manufacturers and within the essential drug list.
MSH:
But again, how are the prices charged to the patients?
Laos:
From the initial price, we increase 10% for taxes, 10% for inflation, and 5% for administration. This markup of 25% was decided by the National Drug Committee.
MSH:
Do you monitor whether people are actually charging 25% instead of 50%? In other words, is there any chance that there is a variety of actual practice going on, which happens in some countries? One may have a policy of a 25% markup, but it's not really checked, so therefore some charge 25%, 40%, 50%, etc.
Laos:
We sometimes check, ourselves. We have to go to the provinces twice a year.
Plenum:
The question raised by the Lao representative as to who will be exempted and how that is decided is also related to pricing. If you exempt a certain number of people, do you need to raise the price? Dr. Thein Swe's presentation gives a good example of how exemptions are decided and how pricing reflects that.
Myanmar: (Thein Swe)
The pricing of drugs is tied to the level; it is decentralized. Prices should not be higher than outside market prices. There are a lot of drug shops outside, whose products are pretty expensive. If the drug fund price is higher than that of the outside, utilization rate will be low. The pricing of drugs is very different according to each township. First, drug prices are released. We central level personnel try to read the market story, which we will compare to the reports submitted by the townships. Sometimes a township report of prices disagrees with our findings from the market, in which case we try to send a letter to that township asking them to explain the situation for the particular drugs in question: why is it more expensive than the local price? At that time, the township sits down and sets a new price for the drug.
The question of exemptions is also very important, and one we are facing in our country as well. Every year, when exemptions are given to a lot of people, the capital or investment of the initial money depletes. We are trying to solve this problem in the following manner. We try to encourage central committee persons to give donations for the year. At the same time, the community or that committee try to motivate collection for initial sick money, perhaps 1 enkyat or so (or 50 cents or so) from each household. The money accumulated in these ways is mainly for exemptions.
III. Mongolia
Myanmar:
You mentioned decentralized autonomy. To what extent and to which level? Regarding the financial status of RDFs, they have a cost recovery of 73.9%. Is that in regard to money or drugs? Your paper also mentioned Debt T. What is that?
Mongolia:
Decentralization proceeded in 1991 to 1993. Most decision making on financing and budgeting is now decided by aimags, sums, and bags. The central economic entity has little power or influence on the local financing budget. Decentralization extends to the lowest administrative unit.
Seventy-three percent of the drugs is recovered in terms of money, debt, what they receive in initial stock and how much they sell in one year.
I must apologize for the translation. “Debt" should be “receivable amount." It is mostly related to hospitals which have used drugs from the drug fund but have yet to pay it back.
Myanmar:
What is the percentage amount of drugs you receive back?
Mongolia:
About 41% is received back. This is replenishment.
Moderator:
What he is asking is that in terms of the costs you recover, what percentage is replenishment, taking into consideration inflation, currency exchange, etc.? For every 100 units you get, how much is recovered?
Mongolia:
Everything can be paid back 100%.
Moderator:
There are a few questions in regard to decentralization which I think are important. As national resources from government budgets begin to shrink, there is always a tendency to look for alternative resources because there is the need to sustain and continue services. In the past, donors have been there to meet the need. But more and more, it becomes necessary to tap the resources of the community. Decentralization is often seen as a mechanism through which the responsibility of providing resources from the central level to the periphery is gradually reduced so that local communities can generate their own funds. While some of the responsibilities are decentralized, all of the resources coming from the central level are still very strictly controlled. There are very clear guidelines; “you can use your funds, but only for buying drugs," is one example. We need to consider the following: to what extent does the authority to make choices about resource allocation and the use of locally generated resources belong to the center, and to what extent should this be decentralized? By only giving lip service to decentralizing and decentralizing responsibility without the resource allocation elements, without releasing the decision making authority on how to use those resources, then the term “decentralization" is a misnomer and we are being led down the garden path. When we are in our groups, and we come to decentralization, look at it a little more deeply in terms of resource allocation.
Myanmar:
I would like to know more about community involvement, if we have any problems in common.
Mongolia:
“Community health volunteer" is relatively new terminology in Mongolia, but we consider it a very important part of the system. When people need emergency help, there should be someone able to deliver food aid or provide consultation. The MOH has been encouraging community health volunteers since 1993, and so far we have been training people identified by the community. These people are invited for two to three week training sessions (it should of course be a continuous process). We try to supply or provide basic instruments to assist them if possible to fulfill their objectives.
Moderator:
How do you make the community aware of them?
Mongolia:
From our one year of experience, awareness of the drug fund in the community is very important. Frequent intervention or activity is very important to people because it shows the committee willing to contribute towards health. We need to interpret their reactions adequately and encourage them.
Moderator:
When assistance, knowledge and skill all come from health providers, it is more likely that an attempt to extract community compliance will be made by telling them, “This is what we are going to do for you. You comply," than when the community participates because it is putting in its own resources. For example, you have more community participation in agriculture than you have in health. Compliance succeeds only as long as you're giving the community benefits. The moment the community stops seeing benefits from you, the compliance comes to a stop. We need to look at awareness development, so as to avoid what I call a mercenary tendency, that “here, I am giving you some benefits, so therefore you agree with what I'm doing." Communities need to feel that this is their health service, not your health service. The Us-Them factor needs to be carefully looked at. Our challenge is to make RDFs strong enough and effective enough, because as the community becomes more and more involved, such issues become more irrelevant. Traditionally, MOHs are very oriented to getting the community to comply rather than participate, which is something that we must be cautious about.
Vietnam:
In your presentation, you mentioned the link between RDFs and the insurance system. That is a very interesting topic, and I want to know more of your experiences in that . In Vietnam, we are trying to do it, but there are many difficulties.
Mongolia:
The health insurance system in Mongolia currently covers all inpatient costs, plus quite a number of therapies in outpatient care. At hospitals delivering inpatient and outpatient care, RDFs have a role. Drugs that hospitals use come from RDFs, which means a hospital should pay back its RDF with insurance money because the cost of inpatient care is covered by health insurance. But we have problems with outpatient care. Outpatient care is only partially covered by insurance, which is something we should discuss with the National Insurance Council. Drug use prescribed for outpatients needs to be covered by insurance. For the issues of affordability and improved financial situation, the link between RDFs and insurance is very important.
Moderator:
You might want to explain that in the national health insurance system in Mongolia, the national government is the primary source of cost recovery because much of the formal sector, and quite a large proportion of the non-formal sector, particularly the indigenous groups, are taken care of by government subsidies that pay the insurance premiums. This is why you have this amount of receivables outstanding, because the money is to be paid by national insurance. These funds are not easily available, so the whole system comes to a halt. Health insurance is directly linked to the issue of cost recovery which is the whole principle of revolving drug funds.
There is a whole range of cost recovery. You have cost recovery that is supported totally by the government, which is what you call free services; you have the other end, in which there is no subsidy at all and every individual is responsible. In between, you have subsidized token fees, that was started for example in Nepal, which is the minimum cost that is paid irrespective of what service is received. Or you have fee-for-service, where every service has a certain cost value: you pay for that cost, which may or may not be subsidized. And then you have insurance, which may be private insurance, not-for profit insurance, community-based insurance, or government insurance.
MSH:
If your goal is full cost recovery, but you're not able to achieve that, what is the end result? What happens to the drug supply? Are you experiencing stock outs? Shortages? What does that do to patient attendance?
Mongolia:
There are two types of cost recovery: one for hospital care, one for outpatient care. If outpatient care is properly done, cost is recovered, because the patient pays for drugs and the cost is fully recovered. The inpatient who is being treated in the hospital does not pay because he is insured. Hospitals should recover the cost from health insurance. The issue is insurance income and insurance from expenditure. At the moment, it is possible for the government to pay insurance premiums on behalf of the majority of the population, including invalids, children under 16, and pensioners. But due to budget constraints, the government is not paying premiums in time into the insurance fund. The Problem is only because of the delay in receipt of insurance premiums.
MSH:
But since they won't or can't pay, what happens to the drug supply?
Mongolia:
The is an issue we need to rethink. Health insurance is a priority issue for the government, so we expect the government will eventually pay the premiums into the insurance fund. Otherwise the whole thing will collapse--not only the revolving drug funds but the whole hospital system because all hospitals are in the same situation.
Moderator:
For a long time in many countries, going to a donor has been the fall back position. If you are in really dire straits, someone will always come and bail you out. The emphasis must now be on developing a good logistics management system, because that's a critical factor. The idea of setting up RDFs is to create some sort of sustainable cost recovery that will have impact on insuring that funds are available for regular purchase, procurement, and supply. If you have an effective drug fund you must have an effective replenishment system. One without the other cannot work. If agencies, donors or NGOs come in and say we are going to set up RDFs and you don't raise the issue of a replenishment system with regards to cost recovery, the RDFs will last as long as the donors. As soon as the funds stop, you will be faced with the old situation.
IV. Myanmar
Mongolia:
I would like to ask about legal status. It is now very important for us to show that we have it because it is very much connected to the sustainability of the RDFs in our country as long as the government is responsible for the health insurance for most of the population. Before, government pharmacies were responsible for giving out drugs. Now RDFs have to be community-based. Legal status has to be defined because in the banking system of Mongolia, the concept of community-managed pharmacies is not very clear. When pharmacies were government owned, the cash deposited in the banks did not earn any interest. Now, for the sustainability of RDFs, interest must be earned. There is, however, no understanding, no concept of what community-managed means.
Moderator:
Her question is also a statement. What has Myanmar done about the legal status? Who owns the drug funds, the government or the community?
Myanmar:
The money recovered is more or less centralized in nature. Until now, 90% of recovered money is sent to the Central Medical Store. This is the focal point of the drug replenishment system. Based on that, and according to their requests, we try to replenish the respective townships. Ten percent of the recovered money is used by the townships.
Chairman:
Ninety percent is used for drug replenishment?
Myanmar:
Only for drug replenishment. Ten percent is for administrative and overhead costs determined by the township council.
Moderator:
So the participation of the township council in the decisions with regard to the use of the money collected from the RDF is limited to only 10% and that for administration.
Myanmar:
The quantification of the drugs requirement of the respective townships is determined by the respective county. The only thing we try to do is collect the money as a capital base for the central replenishment system of the county. Based on the quantified drug needs, the Central Medical Store has to manage and replenish those drugs.
Moderator:
Basically what you are saying is that the management of the funds with regard to payment for procurement is the responsibility of the CMS. Yet the actual decision of what is required is with the township council. Because this money is tied to the revolving drug fund, and guidelines from the government say it should only be used for the drug fund, it is a management arrangement rather than an issue of control. If the control of resources is not with the community but with some other agency above them, does it really belong to the community? Who owns the RDF? The government? The community? The Nippon Foundation?
Myanmar:
We can say that is it controlled by the community, because the community has control of the financial report.
Moderator:
Which then raises the question you were asked. What is the legal status of that money? Is it government money, or is it community money?
Myanmar:
No, not government money. We arranged separate accounts for the RDF systems. It does not belong to the government.
Moderator:
Can the money earn interest in the bank?
Myanmar:
No.
MSH:
Does each township have a separate account?
Myanmar:
Yes. They can check on what they have already deposited with the Central Committee, and what amount of drugs they have already received back. Based on that, they can reorder if necessary.
Moderator:
The reason I am raising this question is because of what happened a few years ago in Ghana, where the RDF cash and carry system was started up. The guidelines given were that this money should be put into an account called a revolving drug fund account, but with the understanding that one of the signatories for the account would be the accountant general. At a particular point in time, with the money becoming less, there were outstanding debts that had to be paid for supplies for the central medical stores. Without knowledge of the agencies that were involved, money was taken from these accounts because the accountant general was one of the signatories. In response to a need by the government, 60 to 80% of the money was being taken, depending on what was available, and used to pay debts that had nothing to do with the RDF. So I'm just raising that as a point. Who owns the RDF? If the interest issue, the banking issue, the accountability issue are still under the control of the government, the community is fully aware they don't really own it. They may have a say in terms of compliance, but as for control...
Plenum:
Mongolia, the reason that you raise this interest issue-- is it because you want to earn additional money, or fight against inflation?
Mongolia:
For sustainability this is really important. There is really a cash problem in our country. This year or next year we are planning to discuss legal status.
I want to ask about other donor assistance, but that is also connected to the problem. It is important to have a national level drug fund. For the time being, in connection with the difficult situation due to the drug shortage in our country, we are receiving quite a lot of assistance from donor agencies. But at the national level it is also very important...
Myanmar:
In our country, the funding agencies are different but operational management is the same.
Moderator:
Because it is being done through the same government, even though the funds coming in are different. Very much like what Nepal is trying to do. Funds are coming in from Kfw, which is the German reconstruction bank, and from the Nippon Foundation, but the idea is to use the same implementing agency, like the Red Cross. The issue of a national RDF is an important one. In some countries, you have a national drug supply logistics system in place. This system is not receiving as much resources as it used to. Mongolia is a good example. What sort of mechanisms can you put into place, in those countries where the central drug supply logistics systems are not as strong or not so well funded, so that this can be sustained at the national level so that you don't have to be constantly putting out your hand and asking for funds?
Cambodia:
I think all the countries have problems or they wouldn't be here. It's very easy to think in a short space of time that community financing and revolving drug funds is going to solve problems, but putting this into place on a national scale is a long-term solution. If the countries here, for the short term (maybe five years), don't have a plan for actually covering drug needs through a combination of government budget, allocation, owner financing, and a little bit of community, they are going to struggle with problems for the next several years. An interim plan needs to be put together. Cambodia, last year, put together a very good five-year financing plan. A lot of donors said that the international community has the responsibility to support this country, support the people, so that a longer term solution can be arrived at. Something like 15 million baht have been pledged by donors. At the same time a large increase in government allocation is extremely important. There's got to be good government commitment, increased budget, then some donor support. Some countries here, I know, do have donor support, so that the gap is completely covered at least for the next five years, giving a chance for all the drug fund experiences to be actually evaluated, replicated, and solutions found.
Moderator:
You have underlined a very important point, that revolving drug funds are not the short-term quick fix for solving problems. They are actually a capacity-building activity that is going to take the longer term. Particularly countries that are setting up drug funds, when you interact with donors, if you have a long term plan, it is very important that that message gets across to donors, because as you know, donors are traditionally very short-sighted. They have one year funding cycles. They want immediate responses. They want to know the effects, cost effectiveness, etc. You need to have a long-term picture.
MSH:
Dr. Narula mentioned Ghana in the cash and carry program. Ghana is the first country I know of that decided to discontinue all help back in 1992. In the middle of 1993, we went in to evaluate the cash and carry, among other things. We took a look at twenty of them. About half were decapitalizing because they just couldn't survive without subsidies, because of exemptions. You didn't talk much in Myanmar about exemptions. You said that it's a local choice or decision. But the question one has to ask is what percentage really are exempt. In Ghana, many of those funds had a list of exemptions. But the people on the health staff, friends, in fact everyone the health staff knew was put on the exemption list, so that in fact very few people really qualified for exemption.
Myanmar:
Regarding exemption, most of our personnel are very reluctant to do exemptions because they worry about depletion. According to our survey, we need to allow at least 10%, but up to now, according to reports, only 2% are exempted among the total number of patients. In some townships, they are very much worried about the depletion of the money, so they try to collect from other people. For example, they might contact the son of a rich man to donate for a particular patient. At the same time, they have established a donation box for donations for the poor. By using this donated money, they try to exempt the patient.
Exemption is also a critical issue for us. If we have to give more exemptions, how many will it be? The prices of drugs are gradually increasing. There is also the issue of inflation. We try to generate money by getting loans from the government. At the same time, we encourage our township medical officers to do other income generation.
Moderator:
The critical principle you are identifying is that exemptions will be there, but there has to be some sort of compensating mechanism to insure that it dose not decapitalize the fund. So whether you approach the government for one-off subsidies or approach the local community to set up a poor fund, an important mechanism needs to be in place. It's something I'm sure happens in other countries, who may need to more formalize the issue, just as Myanmar is doing.
V. Nepal
Vietnam:
What are the results of your study on drug financing? If it is completed, how are you applying the results?
Nepal:
The drug financing study was conducted in one district over two years, which presented certain results. But there are different drug projects in different parts of Nepal, each with different emphasis. Every project has some good and negative points. These days, we try to incorporate all the good points throughout the system. One of the major recommendations of the drug financing study was that ownership of funds should be given to the communities. This was the major recommendation.
Moderator:
In addition to that, what are some of the things that came out of the recent MSH-UNICEF study? What does the ministry want to do about it?
Nepal:
One of the major recommendations was to apply alternative models for community drug funds, depending on the geography and other factors. The second recommendation was to give the drug replenishment system to the private sector. I think that was the idea of MSH, in order to improve measuring.
MSH:
I gather that the recommendation for more involvement of the private sector was a bit controversial, that the MOH is not completely sure it is a good a idea. Perhaps you could say more.
Nepal:
From what I've heard so far this morning, different countries are doing different drug schemes. Most of the countries involve big hospitals, general hospitals, district hospitals. But in our country, the focus is only on primary health centers, health posts and sub-health posts. Of course in general hospitals and district hospitals there are also drug schemes but those are of a different type. General hospitals and district hospitals have governing boards. They decide for themselves. In our country, we have decentralized the health institutions. We do not spend money from the center. We give to the regions, and we give directly to the districts. We give them the medicine, and they supply from the region to the various health institutions. When we spend money from the center, we are not able to supply the medicines and equipment on time, so from this year on we are giving all the money to the district, itself, so whenever it is necessary, it can supply the medicines and equipment to the health facilities in the district.
As far as the private sector is concerned, there is some controversy. It hasn't been decided yet. On one side we are saying that we are going for community participation, we are going to give responsibility to the community. On the other side, we are saying we want to give to the private sector. If we give to the private sector, it means we are handing over everything to them and we are not going to involve the community.
Not only from UNICEF, WHO, or the Nippon Foundation, we are getting various suggestions, and all are contradictory, so we don't know what to do. We are a bit confused. Whenever we conduct a workshop in Nepal, we get a lot of controversial ideas. The government has told us to go ahead with community drug funds, and we are going ahead with it.
Chairman:
You mentioned in your report that many donors in the last ten years have collaborated to help your country. You mentioned more than fifteen projects in the past ten years. All of them really tried to collaborate with your country to develop self-sustainable drug supply systems. There is no contradiction. It's your turn to decide which is the appropriate drug supply system. This is your responsibility.
Moderator:
Yes, there are different ways to accomplish the same thing, like there are so many roads to heaven. The heaven here is having more drugs and logistics management. We are aware that in Nepal, the logistics management system and the whole management division have been receiving a tremendous amount of support input to strengthen performance. To make a statement that “once we turn to the private sector, we'll have to hand everything over to the private sector," probably suggests a rather simplistic solution to this.
From what I recall of MSH's recommendations, the weakest link is the community level's access to drugs it can purchase. What is being suggested is to look at a variety of options. Because you have an interesting geographic set-up and an interesting arrangement with regard to how your population is distributed, you need a number of options for making drugs available to the people in accordance with their needs. We know that the logistics management division is not for the foreseeable future able to Make drugs available. Can we not fill that gap through NGOs, through the private sector? That doesn't mean that the private sector takes over the responsibility for running the health centers. The controversy that exists is not a controversy with regard to supply, but of who will have control over the resources that are going to come, because if the private sector can provide drugs, the case for the government to constantly emphasize that it doesn't have enough drugs becomes a little less effective.
The ministry must recognize what are its priorities, what it wants to accomplish, rather than wait for donors to tell it what to do at a series of workshops. I share Professor Umenai's concerns. The time now is for the MOH to say, “This is what we want to do. We're going to go through with it. We'll make the commitment. We'll put the resources where they are needed. You come and help us," instead of saying, “You tell us what to do, and then we'll proceed in that direction." The steps that the MOH has taken now to develop the second phase of the project is a step in that direction. Who is going to step into the driver's seat now with regard to the setting up of a sustainable supply system? The answer to that question is that the ministry should and the donors cannot, no matter how much resources they provide.
MSH:
I think the conclusion was absolutely that with reference to the private sector. I think the recommendation was not to turn surfaces over, but rather to manage a system of a contracted private sector, where the MOH in fact controls which drugs are purchased, negotiates contract prices where it makes sense using private sector suppliers, rather than trying to implement its own system of logistics in areas where it hasn't been able to do so very successfully. I think that was the recommendation.
Moderator:
I think part of the controversy that exists in the ministry is because the implications of the recommendations needed to be further explored. It was explored at a very superficial level.
VI. Vietnam
Nepal:
In Vietnam's presentation, there were plenty of guidelines, but I did not see any financial management guidelines. Do you have such guidelines to give ideas to the districts on financial management?
Vietnam:
We issued financial management guidelines for the district and community levels in 1993, but those are now outdated. This year, UNICEF conducted operations research on community health financing, which will soon be completed. We will use the outcomes to improve the guidelines.
Nepal:
Did you include the Bamako Initiative's financial regulations?
Vietnam:
Oh yes, that is part of finance.
Moderator:
What were some of the elements that made you aware that the financial management guidelines prepared in 1993 had become outdated? What did you see or observe that prompted you to do this operations research?
Vietnam:
Before 1993, most community and district level finances were totally subsidized by the government. The guidelines only give direction on how to utilize budget allocated by the government. But because of changes in the country, we now have many different financial resources. We look for local contributions from the community, especially on the drug revolving issue. The community is actively involved in the management of the finances of the community, so you have to develop new guidelines.
Moderator:
The whole issue is the monitoring of the performance of revolving drug funds because management of funds and inventory management are very closely interlinked. When you assess the performance of an RDF, you look at the stock as part of the total value of the RDF in addition to looking at the finances that are generated from the sale and purchase of drugs. It is important to look at the linkages between the actual stock value of the purchase and the cash movements. This was included in the reviews that were carried out where it became quite clear that links need to be very clearly established and integrated as much as possible. Traditionally, inventory was seen as one thing (make sure drugs are always there) and collected money was seen as another. This needs to be integrated and managed, preferably with community oversight. What and to what extent should be community oversight? Those were the sort of questions that came up that prompted the operations research.
Chairman:
You mentioned that financial management criteria mainly came from the RDF. Also, someone mentioned the health insurance in Mongolia. Vietnam also has a health insurance system. The systems of health insurance and the RDFs are very different. Can you elaborate on this difference and how the two systems are linked?
Vietnam:
Yes, in our country there is a health insurance system for the whole country. It started in 1989, but so far, it doesn't have much link to the drug revolving fund. We sometimes discuss reimbursement for services when we think that maybe somehow we can bring the RDF into the insurance system. But that is very new to us and we have to learn much more. That is why I asked about the Mongolia experience.
Moderator:
You will be happy to hear that all of the consequences and the success of the RDF in Vietnam came from the fact that it became very obvious that it could no longer be a marginal project; it had to become mainstream, even though in the beginning it started out as a project with only a specific activity. The success of the RDF brought up this point that it had to become mainstream. It's a lesson.
Chairman:
This RDF progress in Vietnam really provides some basis for discussion on what is decentralization.
