Micro Health Insurance & Equity in Rwanda’s Health Financing

1. Micro-Health Insurance and User Fees: Quanitifying Horizontal Equity and Impoverishment in Utilization and Financing of Health Care Evidence from Rwanda Reaching the Poor Conference Washington DC - Feb 19, 2004 Pia Schneider London School of Hygiene and Tropical Medicine (LSHTM) Abt Assoc. Inc.

2. Outline of Presentation • Financial access to care under: • Micro-health insurance (MHI) and User fees • Methods • Indirect standardization to compare horizontal inequity in service use • Minimum standard approach to compare poverty impact of health spending • Findings and Policy Implications

3. Uninsured Individuals Pay User fees Source: Rwanda Household and Living Condition Survey 1999/2001

4. AlternativeMicro-Health Insurance

5. MHI Enrollment (6/2000 and 6/2003) Enrollment is independent of SEG 19% 8% Source: MHI routine data and PHR reports

6. Methods • Compare Impact of health spending under MHI and UF on service use and hh income • Indirect standardization • to examine horizontal inequity (HI) in utilization of care: equal use for equal need? • Minimum standard approach • to quantify the extent to which user fees compared to MHI protect household income against dropping below the poverty line (PL) • Household survey data collected in Sept/00

7. Horizontal Inequity (HI) In Utilization • Equal use for equal need? • Method: Indirect standardization • Concentration Indices (CI) for: • actual use • need-adjusted (expected) use • CI = 0: equal use across soc-econ groups • HI = CI (need-adjusted use) – CI (actual use) • HI = 0: equal use for equal need • Need-adjusted (expected) use: • Pr(need-visit) = F[SAH, age, gen, preg, bed]

8. Sick MHI Members Have Significantly Higher Actual Visit Rates Across SEG User fees: Pro-rich visit distribution Source: PHR household survey 2000

9. Equal Need Across Income Equal need distribution Source: PHR household survey

10. Horizontal Equity in Utilization of Care for MHI Members User fees: Pro-rich visit distribution even when visit adjusted by need User fees: Pro-rich distribution of actual visit Equal visit distribution expected Source: PHR household survey 2000

11. Income Income before health Income after health payment PL A B C Cumul % of pop ranked by income Ho H1 Minimum Standard ApproachPoverty Impact of Health Payments

12. Poverty Measures • Headcount ratio: • % of households below poverty line before and after out-of-pocket health payments • from Ho to H1 • Poverty gap: • average shortfall of income < PL • sum of all shortfalls, divided by population, and expressed in % of PL • A+B+C

13. Similar Poverty Impact Under MHI and User Fees but at Different Use Levels Source: PHR household survey 2000

14. Conclusions • Equal MHI enrollment across SEG : • But the poor may have endured economic hardship to pay annual premium • Health service use: • Uninsured report significantly fewer visits • User fees: Utilization is independent of need but depends of SEG • MHI: Horizontal equity in utilization • OOP health spending: • Similar low impact on headcount and poverty gap if uninsured don’t seek care

15. Recommendations for Policy Makers Expansion: • MHI to other districts • Current MHI benefit package to full district coverage Demand-side subsidies of premium: • MHI enrollment should be associated with targeted measures to ensure that the poorest enroll in MHI