[Subgroup-health] 2nd discussion - Workshop during CGAP Conferenceon Microinsurance

[David Dror]

Deal all,
  John Pott has raised an important issue, that of the link between cost structure and what health insurance actually covers (or could cover). When aggregate average costs are considered, medicines are without doubt more costly than hospitalisations. Yet, as we know, most low-cost micro health insurance schemes put the emphasis on covering hospitalisations, but excluding outpatient medicines and many other outpatient services/goods. This raises two essential issues: one: better ways to include in the benefit package the kind of services/goods that the clients need and would be willing to pay for; and secondly: what optimal way to match income & expenditure: should we emphasize mainly cost containment and restrictions of benefits (which really means exclusions, limitations, caps), or should we give attention mainly to contracting with providers (but then, is this the role of insurers and are they really best trained to do so?), or should we rather stress more inclusive
 rather than exclusive methods, for instance getting better financial results through effective guidance of members where they can get quality services that are also cost-effective (following the model of the 24/7 hotline put into place by Uplift Health) and better pooling across many micro insuraqnce schemes?
  The exclusion-based model has been less effective simply because it gives more attention to the concerns of the insurer and less to those of the clients/members. We have some evidence that trusting the members to make judicious choice pays off in many ways. If they will seek to include medicines, and would be willing to pay a higher premium for that, we may come across as more credibly catering to their needs.
  In my view, this thinking should inspire what we plan to do within all the sub-groups.
   
  One final note on medicines: based on a study by Kotwani et al on cost and availability of medicines in India (published in the Indian Journal of Medical research 2007), generics are not cheaper in all cases than branded, as the cost to the end user reflects not only production and R&D costs but also the cost of distribution, which are high in medicines. The other serious concern is counterfiet drugs, which -no matter how cheap - are the most expensive, and end customers or micro insurers may be ineffective in circumventing... so quality of care is also important to the clients, not just cost.
   
  Hope this helps focus the discussion toward customer-orintation of our deliberations.
   
  Regards,
  david Dror   

mukti bosco <mukti.bosco at healing-fields.org> wrote:
          Dear All,
i agree with john.  Cost of medicines is a very important and critical element in lowering relapses as well as loss of working days for the poor.  We need to look into different ways that have been used to tackle this.
The other important aspect is how do we bring in Out Patient care into Insurance? Many of the illnesses requiring hospitalisation now can be avoided and this reduces work days lost for the poor as they cannot afford to fall ill.
Rgds
mukti bosco
Secretary General
Healing Fields Foundation
Hyderabad
india

  ----- Original Message ----
From: John Pott <john.pott.ext at akdn.org>
To: Valérie Schmitt-Diabate <schmitt-diabate at ilo.org>; subgroup-health at microfinance.lu
Sent: Monday, April 21, 2008 2:28:06 AM
Subject: Re: [Subgroup-health] 2nd discussion - Workshop during CGAP Conferenceon Microinsurance

    Dear Fellow Work Group Members,
   
  The cost of medicines is a very major concern of the micromarket because in many instances for them more than 50% of their out of pocket expenditures for health constitute payment for medicines.
   
  Perhaps I am jumping the gun, but I would like to suggest within the innovative products section - strategies to design an effective low cost benefit package - there should be an activity component that comprises taking an inventory of the approaches that have been adopted so far by insurers to lowering the costs of medicines component of a health package.
   
   The stronger purchasing power of an insurer with a large number of insured ( eg. medicine discounts for members at hospitals and pharmacies); the ability of the insurer to wield some control over the prescribing practices (e.g. strong pressure for generics which are usually so much cheaper than branded); as well as the ability through education of its insured membership to influence patient behaviour and expectations ( e.g. not to expect that risky, expensive and unnecessary vitamin injection at every visit) should I believe yield promising cost savings and therefore lower premiums for our market.
   
  With best regards
   

    John Pott
  Project Manager 
  AKAM Microinsurance Initiative,
  1-3 Avenue de la Paix,
  1211 Geneva 2,
  Switzerland
  Geneva Office Phone 00 41 22 909 7355
  Swiss based Mobile phone 00 41 79 2011 468 
  email: john.pott.ext at akdn.org

  
  
---------------------------------
  From: subgroup-health-bounces at microfinance.lu on behalf of Valérie Schmitt-Diabate
Sent: Fri 4/18/2008 15:53
To: subgroup-health at microfinance.lu
Subject: [Subgroup-health] 2nd discussion - Workshop during CGAP Conferenceon Microinsurance


    Dear workgroup members, 
  We have done already some progress in the joint definition of a mission statement and key questions that we want to adress in our Subgroup on Health Microinsurance (the second round of comments is arriving ; a final version will be ready beginning of May).
  This mission statement is the starting point for the planning of concrete activities of our workgroup. In november the CGAP Conference on Microinsurance will be held in Colombia and we think it is a good opportunity for our workgroup to :
  - meet on this occasion (organize an "internal" working session of the health microinsurance subgroup)
  - organize a workshop / round table on one of the key questions mentioned in our mission statement. 
  We would like the workshop to be a joint activity of the workgroup and ask for your input in its design and realisation. 
  The topic of our workshop should fit in one of the 4 themes of the conference: 1) technology, 2) capacity building, 3) regulation, supervision and policy issues, 4) innovative products and distribution channels
  Combining these themes with the key questions of our mission statement we come up with the following suggestions for the topic of the workshop:
  Regulation, supervision and policy issues 
    
   The role of HMI in national health systems: Initiatives of national governments to extend coverage of health services through HMI (With cases of for example India, Colombia, Ghana, Peru). 

  Innovative products and distribution channels 
    
   Strategies to design of an essential cost effective benefit package adapted to the specific needs and priorities (economically and socially) of the targeted groups   
   Models of providing health microinsurance: the role of social security institutions, CBHI, MFIs, insurance companies and cooperatives.   
   Microinsurance and provision of health: improving health care quality through innovative models of purchasing services 

  Off course, other suggestions are welcome !!! 
  Questions we would like you to answer: 
    
   What should be the central topic of the workshop (choose one of options above, or suggest another topic) ?   
   Suggestions on speakers and cases   
   Input your organization is able to give to the workshop (case studies, documents, exponents, methodology..) 

  We would like you to give your input before the 1st of May. We then will present the results of this election and propose a workplan to prepare the workshop. 
  Harrie Oostingh, Oxfam Novib and Valerie Schmitt, ILO / STEP



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Hon. Professor of health insurance, Erasmus University Rotterdam
  Chairman, the Micro Insurance Academy, New Delhi (www.microinsuranceacademy.org)
  Access my publications freely at: http://ssrn.com/author=183410 (Social Science Research Network) 
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