41243-012: Fourth Health Sector Development Project | Asian Development Bank

Mongolia: Fourth Health Sector Development Project

Sovereign (Public) Project | 41243-012 Status: Active

ADB is helping Mongolia improve hospital services in the capital, Ulaanbaatar, and strengthen the country's drug safety regime. The project will assist in preparing the first hospital development policy for Ulaanbaatar, strengthen medical residency training and postgraduate programs as part of human resource development, set up a drug regulatory authority, and upgrade a drug control laboratory.

Project Details

Project Officer
Jigjidsuren, Altantuya East Asia Department Request for information
Country
  • Mongolia
Sector
  • Health
 
Project Name Fourth Health Sector Development Project
Project Number 41243-012
Country Mongolia
Project Status Active
Project Type / Modality of Assistance Grant
Loan
Source of Funding / Amount
Grant 0236-MON: Fourth Health Sector Development Project: Improving Sector Governance
concessional ordinary capital resources lending / Asian Development Fund US$ 14.00 million
Grant: Fourth Health Sector Development Project
World Health Organization US$ 450,000.00
Loan 2932-MON: Fourth Health Sector Development Project - Additional Financing
concessional ordinary capital resources lending / Asian Development Fund US$ 25.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Health - Health sector development and reform

Gender Equity and Mainstreaming Effective gender mainstreaming
Description The project will strengthen the hospital sector in Ulaanbaatar and improve drug safety nationwide. It complements previous Asian Development Bank (ADB) development initiatives in the health sector in Mongolia.
Project Rationale and Linkage to Country/Regional Strategy

1. The project will strengthen the hospital sector in Ulaanbaatar and improve drug safety nationwide. The project builds on previous health sector development initiatives to continue reforming the Mongolian health sector, including health care financing, in line with the National Development Strategy and the government's Health Sector Master Plan (2006-2015). ADB's Independent Evaluation Department's (IED) sector recommendations emphasize the need for structural changes in health care delivery by rationalizing excess hospital capacity at the secondary and tertiary level, particularly in Ulaanbaatar. The project is included in the Country Operations Business Plan (2009-2012) and the Country Partnership Strategy (2010-2015, in preparation). The project is in line with Strategy 2020 and the Operational Plan for Health under Strategy 2020 addressing sector governance issues and promoting more efficient allocation of health resources.

2. ADB is the largest external financier providing assistance to the health sector, and plays a pivotal role in assisting the government to formulate and implement health sector reforms. Support from other partners tends to be focused on assisting the government to address particular diseases or to develop certain programs. ADB works in close consultation with other partners, and to improve aid effectiveness, efforts are made to support the implementation of the Health Sector Master Plan. Efforts are underway under the leadership of the Ministry of Health (MOH) and in coordination with other development partners in the sector to gradually evolve towards a more sector-based assistance. Parallel cofinancing with the World Health Organization is confirmed under this project.

3. The hospital sector absorbs the bulk of the MOH budget and is characterized by excessive capacity, inefficiencies, fragmentation, and lack of quality services. Mongolia has moved from a health service based on the Semashko model of poli-clinics and mono-profile specialist hospitals to a focus on primary health care provided by family doctors working in Family Group Practices. Public secondary and tertiary care in Ulaanbaatar is provided by over 50 hospitals. Six mono-profile hospitals managed by MOH provide tertiary and secondary care in cancer, traumatology and orthopedics, psychiatry, dermatology, pediatrics, and maternal and child care. Also, MOH manages three multi-functional hospitals that provide a wide range of secondary and some tertiary services. District hospitals, under the city government of Ulaanbaatar, provide a limited range of services, mainly internal medicine and neurology services. Deficient quality of services at primary level and the weakness of the district hospital system result in patient seeking care at tertiary level where lower level services are provided at higher costs.

4. There is a rapidly growing and poorly regulated private health sector consisting of hospitals, clinics, laboratories, and pharmacies which are primarily concentrated in Ulaanbaatar. Hospital buildings and equipment in the public and private sectors are generally in poor condition. Patients stay too long in hospitals with many inappropriate admissions. The training of specialist medical staff is not up to international good practice and the management of the hospital sector is weak. Increasing investments in the hospital sector are expected as the economic outlook for Mongolia is promising. The challenge is to ensure investments are used efficiently to improve accessibility and service quality.

5. The cost of reforming the hospital sector in Ulaanbaatar is estimated at about $450 million. A central question is how to use the limited budget available to the project in a strategic way to ensure an efficient use of future investments. A vision, a hospital policy, and a clear hospital reform plan for Ulaanbaatar (including legal, regulatory, and institutional reforms; capacity building needs; and potential financing sources) are missing. Decision-makers have little understanding on how to improve hospital sector management, rationalize hospital services, and especially how district hospitals could be turned into multi-profile hospitals.

6. Mongolia suffers from illegal importation of drugs and circulation of substandard and counterfeit medicines in the market. Drug regulatory functions are fragmented and local drug manufacturers lack compliance with good manufacturing practices. Public information, drug promotion, and post-marketing surveillance are significantly under-developed. The social and economic costs of unsafe drugs sold on the market are high and there is little awareness among decision-makers. Drug safety needs government's interventions as market forces alone will not solve the problem. Mongolia requires investments and technical support as domestic skills in the area of drug safety are scarce.

7. The need to reform the hospital sector has been identified for more than 10 years (with little achievements), although it is clearly reflected in the government's Health Master Plan (2006-2015). The prospects for meaningful health sector reform are greater now than at any time in the past for several reasons. First, public-private partnerships to tap capital and management for the health system are now possible; second, public demand for reform is mounting; and finally, political leaders are starting to recognize the urgency of improving the system. The project will assist Mongolia in preparing future reforms and ensuring decent socio-economic returns of future investments. The project will improve governance in the sector by improving public investment planning, providing decent and efficient hospital services, protecting the population against fake and substandard drugs, and facilitating the public's access to information on hospital performance and drug safety. At the same time, hospital reforms give the government a unique opportunity to establish a public-private collaboration for the benefit of the population. The project will deliver tangible benefits to women by ensuring their active participation in institutional processes to reform the hospital and drug safety sub-sectors.

Impact Improved health status of the Mongolian population, including the poor
Project Outcome
Description of Outcome Improved health sector efficiency, governance, and drug safety
Progress Toward Outcome

1. Hospital Care Development Policy is approved by MOHS ministerial order in Feb 2014; A Mid-term strategy for implementation of the policy is approved by MOHS in May 2015; In May 2016, the Parliament endorsed new law the Law on Medical Care and Services, which stipulates semi-autonomous status of public hospitals and related institutional, financial and human resource reforms initiated by the Project.

2. The concept of establishment of a drug regulatory authority as an integrated authority with strengthened regulatory functions and improved coordination and quality of medicine is incorporated in several policy documents: (i) Government Action plan 2012-2016; (ii) National Medicines Policy, approved by parliament in October 2014; and (iii) draft revision of the law on medicines and medical devises, submitted to parliament in 2015. A Drug Regulatory Unit is operational with 8 staff at the National Center for Health Development of the MOHS. Core regulatory functions of the unit are: (i) registration of medicines and medical devises, (ii) licensing of specialists and providers, (iii) issuance of import and export licenses, (iv) monitoring and reporting adverse drug reactions, (v) monitoring medicines marketing and advertisement, (vi) promoting rational use of medicines, (vii) developing national pharmacopeia and standards.D rug Control Laboratory building has been upgraded. The Drug Control Laboratory was awarded ISO17025 certification in Dec 2015.

3. Since 2014, the "Health Indicators" - the annual report of the MOHS - includes a chapter on "Pharmaceutical sector indicators"

Implementation Progress
Description of Project Outputs

Component 1: Strengthened Hospital Services in Ulaanbaatar

1.1. Hospital development policy and strategic plan for Ulaanbaatar

1.2. A hospital capital investment planning system is established and operational

1.3. A demonstration multifunctional general hospital established in Songinohairkhan district

1.4. Increased hospital governance

Component 2: Strengthened Human Resource Development

2.1. Strengthened postgraduate specialist structure and residency programs

2.2. Hospital management module integrated in a local training institution

Component 3: Strengthened Drug Safety Regime

3.1. A drug regulatory authority established

3.2. Strengthened drug regulatory functions

3.3. Upgraded drug control laboratory, including accreditation system

3.4. Implementation of good manufacturing practice (GMP)

11. Strengthened post-marketing surveillance and adverse drug reaction monitoring

12. Strengthened drug safety governance function at MOH

Status of Implementation Progress (Outputs, Activities, and Issues)

Component 1.

A major output of the Project is the development and approval of a hospital policy for UB city, which will direct changes in the way hospitals are financed, managed, organized and deliver services. The Project assisted the MOH to prepare a draft policy document on hospital development, which covered private sector participation, governance autonomy and financial issues. The MOH approved a shorter version of the policy "Hospital Care Development Policy" in February 2014, the midterm strategy and action plan for 2015-2019 in May 2015. In May 2016, the parliament approved the Law on Medical Care and Services, which stipulates semi-autonomous status of public hospitals and related institutional, financial and human resource reforms initiated by the Project.

The Project aims to turn the Songinokhairkhan district hospital (SDH) of UB city into a multifunctional general hospital in order to implement the government's hospital development policy. The new demonstration general hospital will be a district-level hospital with 200 beds including an intensive care unit. The hospital will provide inpatient and outpatient care in the seven basic medical specialties (internal medicine, obstetrics, gynaecology, paediatrics, and general surgery), traditional medicine, neurology, infectious diseases and dental care, as well as the first-level emergency care including simple traumatology care for a 150,000 population. The construction of the new hospital is planned to start in May 2017. The project is supporting the MOH in developing the _SDH Establishment Plan_ to guide the implementation of the establishment of the new SDH. The project started the training of medical staff for the new SDH - 29 medical doctors in 17 specialty areas and 123 nurses in 11 clinical areas.

Component 2.

The Project aims to strengthen the postgraduate specialist training structure. The project consultants developed the draft institutional regulatory framework, which describes the roles and functions of institutions involved in postgraduate training planning, accreditation and training, and policy recommendations to advance the current system. Some of the policy recommendations were reflected in the revised Health Law (2016) and the new Law on Medical Care and Services (2016). Project consultants, jointly with the MOH working group members, have revised the curricula for residency training in 4 areas and made them comparable to the internationally accepted levels. New curricula have substantial differences in terms of content, training structure, funding mechanism, duration, and requirements for the training institutions, trainers and trainees. The MOH will pilot the new curricula in the residency training for the new SDH staff. To support the new curricula and residency training, the core textbooks in 4 areas have been translated into Mongolian language. The project consultants also reviewed the postgraduate training for nurses and developed 10 new curricula (reduced from 26 to 10) with a strong emphasis on in-service training in the hospital. The School of Public Health, in association with the Association of Public Health Specialists and Management Academia, organized two trainings for senior and middle level hospital managers in 2014 and 2015. A total of 50 managers have been trained.

Component 3.

The concept of establishment of a drug regulatory authority as an integrated authority with strengthened regulatory functions and improved coordination and quality of medicine is incorporated in several policy documents: (i) Government Action plan 2012-2016; (ii) National Medicines Policy, approved by parliament in October 2014; and (iii) draft revision of the law on medicines and medical devises, submitted to parliament in 2015. A Drug Regulatory Unit is operational with 8 staff at the National Center for Health Development of the MOH. Core regulatory functions of the unit are: (i) registration of medicines and medical devises, (ii) licensing of specialists and providers, (iii) issuance of import and export licenses, (iv) monitoring and reporting adverse drug reactions, (v) monitoring medicines marketing and advertisement, (vi) promoting rational use of medicines, (vii) developing national pharmacopeia and standards. But some functions are still with the General Agency for State Inspection (GASI) such as drug control and control and inspection.

The Drug Control Laboratory under GASI has been upgraded and internationally accredited by the certification agency- ANAB/ACLASS in Dec 2015. A new national GMP standard (MNS5524:2014) was approved by the Mongolian Agency for Standardization and Metrology in 2014. A GMP certification procedure was approved by MOHS in 2013. Procedures on reporting on adverse drug reaction (ADR) is approved by MOHS in 2013; and the National Pharmacovigilance strategy is approved in 2014.

Geographical Location
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects

An environmental assessment has been carried out in accordance with the Mongolia regulatory framework and ADB's Safeguard Policy Statement (2009). A consolidated initial environmental examination (IEE) report was prepared, which assesses and addresses the environmental implications of the rehabilitation and expansion of the Songinohairkhan District Hospital and the New Central Laboratory. The team and project counterparts agreed to specify the whole laboratory building as an associated facility. This allowed conducting necessary due diligence for the building, resulting in the conduct of the necessary domestic environmental assessment, ensuring compliance with the Mongolian law. The consolidated IEE summarizes the findings of the New Central Laboratory Environmental Impact Assessment (EIA) and the Songinohairkhan District Hospital Initial Environmental Examination (IEE), and a due diligence review of project associated facilities. Potential adverse impacts during the construction and operation phase include limited standard construction impacts; and occupational and community health and safety issues, especially the unsafe collection, storage, treatment, and disposal of medical and chemical hazardous waste. The possible adverse environmental impacts will be prevented or minimized to acceptable levels, through the implementation of the environmental management plan (EMP) that includes adequate mitigation and monitoring arrangements. Following up the Inception mission, project national environmental consultant had reviewed the Environmental Management Plan (EMP) of the project and updated relevant sections based on mission recommendations and results of situation analysis and submitted to ADB in June.

The environmental assessment process achieved significant value added by (i) catalyzing, through policy dialog with MNET and GASI, the development of an EIA for the project's associated new central laboratory building; (ii) developing comprehensive management systems for the collection, storage, and treatment of medical and hazardous chemical waste; and (iii) developing a substantial consolidated IEE report which defines environmental mitigation measures, monitoring requirements, institutional responsibilities, and training and capacity building requirements.

The Inception mission reviewed the progress of project preparation with regard to environmental safeguards, and agreements were reached on the next steps and responsibilities. Field visits were conducted to the Songinokhairkhan district hospital, the new Central Laboratory, and the medical waste treatment facility operated by Element Company.

The Grievance Redress Mechanism (GRM) guidelines were developed in accordance with recommendations and templates provided by the ADB environmental specialist and submitted to ADB on 9 June and received feedbacks and incorporated them into the guidelines. GRM section of EMP was also revised.

Involuntary Resettlement No involuntary resettlement effects are foreseen and the project is classified as a category C project. The upgrading of the facilities of the multifunctional hospital will be on existing government land and will not affect local residents or residential buildings. A resettlement plan and framework are therefore not required. Should there be any change in scope or other changes with unanticipated resettlement impacts during project implementation, land acquisition and resettlement activities will be implemented in accordance with ADB's Safeguard Policy Statement.
Indigenous Peoples The project will not have any negative impact on indigenous peoples and is therefore classified as a category C project. No further actions are therefore required.
Stakeholder Communication, Participation, and Consultation
During Project Design Consultations with key stakeholders were held during project preparation including focus groups with beneficiaries such as local community member and hospital patients, in-depth interviews with family general practice doctors, hospital directors, and specialist doctors in Ulaanbaatar. The first series of consultations investigated current access to health services and medical drugs by the poor, and the findings are included in the poverty and social analysis section above. The second round of interviews and focus groups were held with hospital doctors and inpatients to solicit their views, suggestions, and recommendations regarding the proposed project design to establish a multifunctional hospital and a drug regulatory body. The multifunctional hospital will involve establishing new patterns of service delivery which will be complex and there may be risks associated with it. For this reason effective ways of defining and measuring the quality of hospital care will be established and systems will be put place to redress poor quality service should it arise.
During Project Implementation The Project has contracted two local NGOs (_Monconsult_ LLC and _Shagdui_ LLC) to implement the project consultation and participation activities and to foster community participation and involvement. Monconsult has been implementing the community awareness program to raise awareness among community of focus on ongoing hospital reform and drug safety issues and ensure community participation for the monitoring and feedback purposes in Songinokhairkhan district. The program trained 64 outreach workers composed of district social workers and organized three open-day events. Shagdui has developed (i) information, education and communication (IEC) materials on drug safety and hospital care policy that were approved by the Public Health Institute on September 2016; and (ii) prepared the draft communication strategy and action plans for hospital policy reform and drug safety which are awaiting the MOH approval. The public awareness campaign and outreach program are expected to start from Q1 2017.
Business Opportunities
Consulting Services The Recipient is responsible for selecting, engaging, and supervising Consultants engaged under the loans and grants funded by ADB. All consultants will be recruited according to ADB's Guidelines on the Use of Consultants (April 2010, as amended from time to time).
Procurement All procurement of goods and works will be undertaken in accordance with the Asian Development Bank's (ADB) Procurement Guidelines (2010, as amended from time to time). International competitive bidding (ICB) will be applied to goods contracts estimated to cost $2,000,000 or more and works contracts estimated to cost $5,000,000 or more. Goods contracts with values less than $2,000,000 and works contracts with values less than $5,000,000 will follow national competitive bidding (NCB). Works and goods contracts with values less than $100,000 will be procured using ADB's shopping procedure. NCB procurement will be carried out on the basis of NCB procedures, in accordance with the Mongolian Procurement Law, subject to modifications agreed with ADB. Before the start of any procurement, ADB and the government will review the public procurement laws of the central and state governments to ensure consistency with ADB's Procurement Guidelines. The internationally tendered equipment packages will include the necessary technical support for ensuring proper installation, testing, commissioning, and training of operational staff as part of the related contracts. In accordance with ADB requirements, foreign contractors may participate in bidding for NCB contracts. For NCB, the first draft English language of the procurement documents (prequalification, bidding documents, draft contract) should be submitted for ADB approval regardless of the estimated contract amount. Subsequent procurement are subject to post review. All ICB contracts are subject to prior review. Prior review and approval of ADB of the procurement documents (prequalification, bidding, contract) is required.
Responsible ADB Officer Jigjidsuren, Altantuya
Responsible ADB Department East Asia Department
Responsible ADB Division Mongolia Resident Mission
Executing Agencies
Ministry of Health (formerly Ministry of Health and Sports)
[email protected]
1st Floor, Government Building VIII
Olympic Street 2, Ulaanbaatar
Mongolia
Timetable
Concept Clearance 04 Jun 2010
Fact Finding 18 May 2010 to 20 May 2010
MRM 03 Sep 2010
Approval 29 Nov 2010
Last Review Mission -
PDS Creation Date 19 Oct 2010
Last PDS Update 24 Mar 2017

Grant 0236-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
29 Nov 2010 10 Dec 2010 03 Mar 2011 31 Dec 2016 31 Dec 2020 -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 17.70 Cumulative Contract Awards
ADB 14.00 29 Nov 2010 8.61 0.00 62%
Counterpart 3.70 Cumulative Disbursements
Cofinancing 0.00 29 Nov 2010 5.44 0.00 39%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory - - Satisfactory - Satisfactory

Loan 2932-MON

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
05 Nov 2012 07 Feb 2013 14 Jun 2013 31 Dec 2016 31 Dec 2020 -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 27.00 Cumulative Contract Awards
ADB 25.00 05 Nov 2012 21.18 0.00 92%
Counterpart 2.00 Cumulative Disbursements
Cofinancing 0.00 05 Nov 2012 3.32 0.00 14%
Status of Covenants
Category Sector Safeguards Social Financial Economic Others
Rating Satisfactory - - Satisfactory - Satisfactory

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

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Title Document Type Document Date
Fourth Health Sector Development Project: Procurement Plan Procurement Plans Jan 2017
Fourth Health Sector Development Project: Audited Project Financial Statements (January-December 2015) Audited Project Financial Statements Oct 2016
Fourth Health Sector Development Project - Additional Financing: Audited Project Financial Statements (January - December 2014) Audited Project Financial Statements Sep 2015
Amendment to Loan Agreement for Loan 2932-MON: Fourth Health Sector Development Project - Additional Financing Loan Agreement (Special Operations) Jun 2015
Fourth Health Sector Development Project - Additional Financing Procurement Plans Jun 2015
Amendment to the Loan Agreement for Loan 2932-MON: Fourth Health Sector Development Project - Additional Financing Loan Agreement (Special Operations) Mar 2015
Amendment to the Grant Agreement for Grant 0236-MON: Fourth Health Sector Development Project Grant Agreement Jun 2014
Fourth Health Sector Development Project (Additional Financing) Project/Program Administration Manual Jul 2013
Эрүүл мэндийн салбарыг хөгжүүлэх IV төсөл : Төслийн Мэдээллийн Тайлан Translated PDS Feb 2013
Loan Agreement for Fourth Health Sector Development Project – Additional Financing Loan Agreement (Special Operations) Feb 2013
Fourth Health Sector Development Project - Additional Financing Reports and Recommendations of the President Oct 2012
Fourth Health Sector Development Project - Additional Financing Gender Action Plans Oct 2012
Fourth Health Sector Development Project (Additional Financing) Project/Program Administration Manual Oct 2012
Fourth Health Sector Development Project (Additional Financing) Initial Poverty and Social Analysis Aug 2012
Grant Agreement for Fourth Health Sector Development Project: Improving Sector Governance between Mongolia and Asian Development Bank dated 10 December 2010 Grant Agreement Dec 2010
Fourth Health Sector Development Project Reports and Recommendations of the President Nov 2010
Fourth Health Sector Development Project: Gender Action Plan Gender Action Plans Nov 2010
Fourth Health Sector Development Project Project/Program Administration Manual Nov 2010
Fourth Health Sector Development Project Summary Poverty Reduction and Social Strategies Nov 2010

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.


The Public Communications Policy (PCP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

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