Indonesian Health Reform in a decentralized system

Laksono TrisnantoroCenter for Health Service Management

Gadjah Mada Universitytrisnantoro@yahoo.com

Preface

This paper is concerned with critical questions:• Is there a reform in Indonesian health sector?• Whether decentralization policy supports

health care reform?

ContentDefinition of Reform in Health CareObservations:- 1. Health Care Reform at national level under

decentralized policy ( 1999 – 2007)- 2. Health Care Reform in 7 Provinces (2006),

ConclusionWhat next?

Reform Definition• sustained, purposeful

change to improve the efficiency, equity, and effectiveness of the health sector

What Do We Mean by “Health System Reform”? (Bossert, 2007)

5

• Not everything that changes, or causes change, is a health system reform

• Purposeful efforts to change the system to improve its performance

Using an interesting understanding of:• “little r” reforms; Small changes to one or a few

features of the system• “Big R” reforms; Large changes to more than one

feature of the system

Health system reform:

What is the meaning of health system features?

• Depends on the definition: • WHO: stewardship, provision,

resources generation, etc• Kovner: the role of government

in: regulation, provision of services, and financing the system

• Harvard and WBI: use the “knobs” metaphora

7

The “Control Knobs” from Harvard and WBI

• Financing• Payment• Organization• Regulation• Persuasion and Behaviour Change

Terminology

• reform• Reform

• “little r” reforms; Small changes to one or a few features of the system

• “Big R” reforms; Large changes to more than one feature of the system

Will be used for analyzing Indonesian Health Sector through 2 observations:

• National level• Provincial level

Observation 1: National Level

• Reform in Finance• Reform in

Organizing and Paying Human Resources

• Reform in Regulation

• Reform in health Promotion

• ....

Critical Question:Is there any reform in • health finance? • Human Resources?Is there any effort for linking these

features of health reform?

Reform in Health Finance• Historical context of Indonesian Health

Finance• Major milestones in the 2000s• What happened?

Historical Perspective

• Colonial Period• Independence and the

“Old Order”• “New Order”• Decentralized era

Before 1945

1945 - 1965

1965 - 1999

1999 - at present

Colonial Period

• The Dutch Indie was not administered as a welfare state

• Health services were provided for government employees, military personnel, and big company employees.

• Missionary hospitals and health services worked with limited coverage

1945 - 1965

• The period of market forces suppression• There was no clear national health financing

policy.• There was an Act on poor family health

services in early 1950s, but poorly implemented.

• Health insurance and social security is limited for government employees, military personnel, and big company employees.

1965-1998

• The market economy was introduced• The private sector growth rapidly, incl, for

profit hospitals.• There is a corporatization of medical services

based on market forces• There was no clear regulation of health

market • 1997: Economic crisis induced the Social

Safety Net incl. Health.

1999 - current

• Decentralization era since the stepdown of Suharto in 1998

• Direct Presidential and Governor/Major election

• More populist policies at national,provincial, and district level

• Poor family has free health and hospital services

• Poor family scheme becomes political issue

Historical Facts• Indonesia is not a

welfare state since the colonial era

• Indonesia has market based economy

• Indonesian health system refers to American model using Safety Net, not the British one.

• Hospitals operate within market ideology

• Medical Doctors (esp. specialists) operates based on the fundamental demand and supply principles.

Indonesian health finance situation in 2001

05/04/23 18

Study by Equitap Group

05/04/23 19

05/04/23 20

05/04/23 21

05/04/23 22

The market forces domination in Indonesia

Health Finance “Reform” in 2004

Objective: to achieve Universal Health Coverage by National Social Security Law

(UU SJSN)

24

Organization and Management

- Each single existing carrier follows its own regulation - For profit entities

PT.

ASKES

Branch

PT.

TASPEN

Branch

PT.

ASABRI

Branch

PT.

JA

M SOSTEK

Branch

Branch

PRESIDENT

5 years

nch

SS Carrier

ASKES

Branch

SSCarrier

TASPEN

Branch

SS Carrier

ASABRI

Branch

SSCarrier

JAM SOSTEK

Branch

Nat Soc Sec Council

SS Carrier

INFORMAL

Board

NatSoc

SecurityCarriers

BoardBoardBoardBoard

- Nat Soc Security Council directs main policy- Nat Soc Security Carriers implement the program, not for profit- Synchronization of multiple schemes

Indonesia’s Transition to Universal Coverage Indonesia’s Transition to Universal Coverage (National Social Security Law No.40/2004)(National Social Security Law No.40/2004)

Branch

Source: MOH: Ida Bagus Indra Gotama, Donald Pardede

The program in 2005

• Ministry of Health introduced Askeskin (Health Insurance for the Poor)

• The budget was calculated based on 5 thousand rupiah per month per individu.

(commercial health insurance: from 25.000 - 250.000, to US dollar for overseas scheme)

• There was a poor registration system for poor people at the beginning of the program

The Contract to PT Askes Indonesia(2005-2007)

• Ministry of Health under the new Minister contracted PT Askes Indonesia for managing the Askeskin scheme for poor family.

• This was a radical change from the previous policy, which channel the central budget directly to the hospitals and encourage local government health office to develop health insurance scheme.

• There was no pilot study

The Change in 2005

Government as Payer

Hospital

Community

Government as payer

Hospital

Community

PT Askes I

Subsidy to Providers (based on utilization)

Contract to PT Askes Indonesia

28Source: Health PER, World Bank 2008

Health Insurance situation (2005-2007)

In 20082006-2007: Many disputes between Ministry of

Health and PT Askes Indonesia• A new change in 2008: Askeskin program was

renamed to Jamkesmas.• The coverage is not only the poor but also near poor

(more coverage).• The budget is channelled directly to Hospital and

Health Centers using managed care concept (incl. DRG)

• Increasing budget.

05/04/23 30

How Pay for Health CareThe national health security program increased government budget

Is this an indicator of success in reforming Indonesian health finance?

Since 2001, - the health program for the poor had improved the utilization of public hospital by the poor - Kakwani Index is improving

-0.4

-0.3

-0.2

-0.1

0

0.1

0.2

KI 2001 KI 2004

Tahun

Kakw

ani In

dex Hospital Inpatient

Care

HospitalOutpatient Care

Non-hospitalInpatient Care

Non-hospitalOutpatient Care

All Public HealthCare

But,

• There is still a geographical inequity

Due to the access to• Medical specialists• HospitalsAcross Indonesia

Specialist distribution (KKI, 2008)

• Jakarta: 24% of specialists, serves around 4% community in a relatively small area

• Provinces in Java: 49% of specialists, serves around 53% community

• Rest of Indonesia: 27% of specialists, serves around 43% community in a very large area

35

Average Number of Public Hospital at a district

Low economy in the community

High economy in the community

High Fiscal capacity in local government

2.5 2

Low fiscal capacity in local government

0.5 0.31

36

Average number of Private Hospital at a district

Low economy in the community

High economy in the community

High Fiscal capacity in local government

1.05 2.11

Low fiscal capacity in local government

0.5 1.91

Hipothesis

• Health Finance provided by Jamkesmas will be used more by poor and near poor people in and around big cities

• Most in Java Island• Left the poor and near poor people in remote

area or in the places where there is no medical service and specialists

38

This hipothesis may explain why Indonesian Insurance Coverage Status in 2007 (based on social economy survey)

looks not good.

73,3

14,4

62,4 2,9 1

UnisuredJAMKESMASASKESJAMSOSTEKOtherJPKM

Source: SUSENAS 2007

Therefore:

• Health finance reform should be linked (at least) with Human Resources Reform

• How is the condition of health care reform in human resources?

Reform in Human Resources

• This discussion focuses on specialist

41

Indonesia is experiencing critical shortage of doctors, midwives and nurses

Sumber: WHR 2006

42

How many are really needed? Perception of 32 districts*

Need Availability GAP (%)Doctor 987 593 39,9Specialist Doctor 64 30 53,1Dentist 497 294 40,8Midwife 4565 2951 35,4Nurse 4492 3295 26,6Pharmacist 89 47 47,2Dietician 652 404 38,0Public Health 415 312 24,8Sanitarian 737 530 28,1Public Health 182 82 54,9Epidemiologist 21 0 100,0

Total 13.793 9.216 33,2

*) Bappenas Study in 2005

43

Doctor Distribution in 2003-2004

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1500

2000

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As an illustration:Specialists Distribution (Pediatrics)

Data: IDAI (Pediatrician Association, 2006)

J umlah Dokter Spesialis Obsetri dan Ginekologi

44

31

46

107

568

127

1120

1113

1618

2217

272929

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123345788891011121313141517

2123252728

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287

0 50 100 150 200 250 300 350

MalutPapua Barat

GorontaloSulbarBabel

BengkuluPapua

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NADJ ambiKalbarKepriKalselKaltim

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SumbarSumselSulsel

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DKI

2006 2008

Typical graphic description of medical specialist distribution

Obstetric and Gynecologist

46

National Plan for “Reform” in Health Human Resource

47

Reduce disparity on health status and health care Increase the number and improve distribution of health

workers Improve access to health facility Reduce double burden of diseases Reduce misuse of narcotics and prohibited substances

RPJP (Long Term Plan)

48

1. Increase the number, network and quality of health centers; 2. Increase the quality and the number of health personnel; 3. Develop health insurance system especially for the poor; 4. Increase dissemination of environmental health and healthy

life style; 5. Increase health education to the community since early age;

and 6. Distribute and increase the quality of primary health care.

RPJM (Medium Term Plan)

49

Health Resource Program 2004-2009Objectives : increase number, improve quality & distribution of health

personnel, as well as improve health insurance for the poor

Main Activities:1. Setup Plans for health personnel need; 2. Improve skill and profesionalism through education and training 3. Deploy of health personnel especially for health centers (and their

networks) and hospitals; 4. Carrier development5. Improve sustainable health insurance for the poor.

RPJM (Medium Term Plan)

05/04/23 50

1. Improvement of equity, accessibility, and quality of health services especially for the poor, through provision of free of charge access of the poor to health center and hospitals

2. Improving availability of medical and paramedical personnel, especially in remote and less developed areas

RKP 2008 (Annual Plan)

51

The Facts in 2008

Specialist distribution (KKI, 2008)

Province Number % Cumulative People served Ratio

DKI Jakarta

2.890 23,92% 23,92% 8.814.000,00 1 : 3049

Jawa Timur 1.980 16,39% 40,30% 35.843.200,00 1 : 18102

Jawa Barat 1.881 15,57% 55,87% 40.445.400,00 1 : 21502

Jawa Tengah 1.231 10,19% 66,06% 32.119.400,00 1 : 26092

Sumatera Utara 617 5,11% 71,17% 12.760.700,00 1 : 20681

D.I.Jogjakarta 485 4,01% 75,18% 3.343.000,00 1 : 6892

Sulawesi Selatan 434 3,59% 78,77% 8.698.800,00 1 : 20043

Banten 352 2,91% 81,69% 9.836.100,00 1 : 27943

Bali 350 2,90% 84,58% 3.466.800,00 1 : 9905

Sumatera Selatan 216 1,79% 86,37% 6.976.100,00 1 : 32296

Kalimantan Timur 203 1,68% 88,05% 2.960.800,00 1 : 14585

Sulawesi Utara 173 1,43% 89,48% 2.196.700,00 1 : 12697

Sumatera Barat 167 1,38% 90,86% 4.453.700,00 1 : 26668

Propinsi Lainnya 1.104 9,14% 100,00% 52.990.200,00 1 : 47998

  12083 100,00%   224.904.900,00 1 : 18613

Number of private hospitals is increasing more than government ones.

• Number of For-Profit Private-Hospital almost doubled in the last five years

• Number of Non-For-Profit-Private Hospital almost remained the same

Owner03 04 05 06 07 08

For Profit Corporation

49 52 55 60 71 85

Non-Profit (Foundation)

530 538 538 538 539 539

Non-Profit (NGOs)

27 27 28 28 28 29

Total 606 617 621 626 638 653

The increase of for-profit private hospital:

• Most happened in Java• Indicates the increasing

role of private sector which can attract more medical specialists to Java

• Some owned by medical specialists

• Doctor culture is more influenced by private health service organization

• Without good payment and better work conidtion is more difficult for out of Java hospitals to attract doctors

Medical Specialis Culture Facts in 2008(done by various cultural studies in medical specialists)

• There is not any significant change in medical specialist behavior.

• Market influence in specialist is increasing.• Jamkesmas (health insurance) program is

difficult to compete with fee for service system for doctor and medical specialists

• No managed care culture

Current Medical Practices:

Specialists prefer to provide services in the middle and upper class using fee-for-service

Try to set own fees

No standard income

Link between Health Finance “Reform” and Human Resources

• Health finance “reform” does not consider medical doctor and specialist condition

• No attention in reforming the doctor payment. The fee for medical doctor from Jamkesmas is too low or not clear.

• Human resources “reform” is not clear and weak in practice.

Does not meet the criteria of Health System Reform

58

What Do We Mean by “Health System Reform”? (Bossert, 2007)

• Not everything that changes, or causes change, is a health system reform

• Purposeful efforts to change the system to improve its performance

• “little r” reforms; Small changes to one or a few features of the system

• “Big R” reforms; Large changes to more than one feature of the system

Does not meet the criteria of Health System Reform

Note: the National Reform in Health Finance

• Health finance reform is not will designed and executed

• The SJSN Law is not yet effective due to the lack of Government Regulation for implementation

• Until 2009 there is no GR

• The current implementation of SJSN Law is more political rhetoric, not technical.

Observation 2

• Reform at Provincial Level

Based on DHS1 Project at 7 Provinces

• Riau• Riau Island• Bengkulu• Bali• North Sulawesi• South East Sulawesi• Central Sulawesi

The Question:• Is there any reform

with big R at provincial level?

• A close observation into 54 DHS1 projects which are called as reform activties in 7 provinces

Reform Topics Riau Riau Island

Bengkulu

Bali North Slws

S EastSlws

CentralSlws

Health Finance 1 1 2 1 5

Health service provision 9 2 3 7 4 2 6 33

Stewardship/regulation 1 1

Human Resources 1 2 3

Community Empowerment

2 2 1 2 7

Health System development

1 2 1 1 5

Total 12 3 7 10 8 5 9 54

Analysis

• All reformed-program was not designed as a big “R” reform

• Each reformed-program is independent each other

• The most popular topic: Health service Provision

• No reform in public and private partnership

Why there was no big “R” of health reform at provincial level?

There was no clear definition of health care reform

• Provincial Government followed the change of national program and it is called reform.

• Technical change in the program is also called reform.

• No clear design of health care reform from the central government

Decentralization policy is not effective to initiate reform

•Conclusion

1. Health Reform is not well prepared at national and provincial level.

• Reform is associated with political issue during the Suharto (ex president) stepdown period (1999).

• Ministry of Health did not have intention to reform the health sector after decentralization policy (2000 – 2007)

• There is no formal health reform document

2. Health reform with small “r”only: not interrelated as prescribed by experts.

At national health finance reform was designed without any intention to link to the reform in:

• Paying medical specialists• Improving the organization of health service

(developing health service network across country)

• Changing the behavior of people (e.g smoking prevalence increases among the poor people)

3. Decentralization policy has little effect on the reform at provincial and district level

Why?• The Government

Regulation No. 25/2000 (based on Act 22/99) on government function at different level was unclear in its concepts and implementation until replaced by PP 38/2007 (based on Act 32/04).

• The period of 2000 – 2007 is still in the transition of decentralization policy

• It is not the right time for making reform (as it is still in a transitional phase).

Notes: in the Decentralization Policy:

The pendulum is swinging

centralizationDe-centralization

Act 22/99

Act 32/04

2000-2007: The era of confusion and “strange” situation

• Change without significant change

• Change in the Laws and Regulation but not significant change in the process and the improvement of health status indicators.

Indonesian health sector is a decentralized sector but experiencing:

• a more “centralized” financing system (06-07).

• Not coordinated change.

Will be discussed in Nossal Institute, University of Melbourne, Thursday 20th of May 2009

centralizationDe-centralization

Act 22/99

Act 32/04

After the stipulation of GR no 38 in 2007 (following Acts no 32/04):

• the legal basis for designing and implementing health reform gets new momentum

Closing remark: What next?

Is there any future of Indonesian Health Reform• at National Level?• at Provincial? • at District?

Moving Forward

• 2007 • Pesimistic? No health reform

• Optimistic? There will be health reform at national, provincial and district level

• Current activities in Indonesian Health Reform

Activities at central level

• Ministry of Health established a small group on how to initiate health reform (started 2008)

• But, this small group is not fully supported by top officers in the MoH

Activities at provincial and district level (small scale)

• Gadjah Mada University in collaboration with MoH, local governments, supported by:

• the World Bank Institute, • Harvard School of Public Health, and • Ausaid, develops the capacity of planning and

executing health care reform through the Flagship Program in Health Care Reform and Sustainable Financing (started in 2008)

• The experiment is implemented in 5 Provinces and 5 districts/cities

The Flagship Program combined training and consultationIn-campus training (I)

In-campus training (II)

Off campus I: work assignment and consultation

Off campus II: work assignment and consultation

Preparation- FGD at each Prov/District - Acquiring data set

Post-CourseConsultation and Workshop

78

Problem identification

Political Decision

EThics

Politics

Implementation

Policy Development

Diagnostic

Evaluation

Health Sector Reform Cycle

Program Schedule

In-campus training (I)

In-campus training (II)

Off campus I: work assignment

Off campus II: work assignment

Preparation- FGD at each Prov/District - Acquiring data set

Post-CourseConsultation and Workshop

Whether the activities will be effective to initiate and implement health reform?

The Supports• There are sufficient experiences

during the transition period of decentralization (2000-2007)

• The legal basis is available• The support of Ministry of Home

Affair for health reform based in decentralization policy is big.

• The knowledge of health reform is supported by international experts

But, • The success

depends on the leadership of Ministry of Health and Provincial/District/ City Health Leaders.

Thank-you