51386-001: Improving Health Care Financing for Universal Health Coverage | Asian Development Bank

Mongolia: Improving Health Care Financing for Universal Health Coverage

Sovereign (Public) Project | 51386-001 Status: Proposed

The proposed knowledge and support technical assistance (TA) will support development of more efficient health insurance system in Mongolia through assessment, development of more effective model, policy reforms, and institutional development. This is to shift state funding from financing budget lines (input-based) to purchasing services (output-based), to allow for more equitable health care system and achieve universal health coverage under the Sustainable Development Goals. The TA will lay the foundation of the strategic purchaser, which will be consolidated by the Multitranche Financing Facility (MFF): Improving Access to Health Services for Disadvantaged Groups, which is still in process and is expected to be approved by 2019.

Project Details

Project Officer
Tajima, Eisuke East Asia Department Request for information
Country
  • Mongolia
Sector
  • Health
 
Project Name Improving Health Care Financing for Universal Health Coverage
Project Number 51386-001
Country Mongolia
Project Status Proposed
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
Strategic Agendas Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Knowledge solutions
Partnerships
Sector / Subsector

Health / Health care finance - Health insurance and subsidized health programs - Health sector development and reform

Public sector management / Social protection initiatives

Gender Equity and Mainstreaming Some gender elements
Description The proposed knowledge and support technical assistance (TA) will support development of more efficient health insurance system in Mongolia through assessment, development of more effective model, policy reforms, and institutional development. This is to shift state funding from financing budget lines (input-based) to purchasing services (output-based), to allow for more equitable health care system and achieve universal health coverage under the Sustainable Development Goals. The TA will lay the foundation of the strategic purchaser, which will be consolidated by the Multitranche Financing Facility (MFF): Improving Access to Health Services for Disadvantaged Groups, which is still in process and is expected to be approved by 2019.
Project Rationale and Linkage to Country/Regional Strategy

The purchasing capacity of HIOs has improved over the last decade with support from ADB. However, key operational systems needed for effective purchasing of health services, such as the capacity to (i) provide quality of cost services; (ii) monitor the quality of service provision through an effective information technology-based system; (iii) review claims efficiently; and (iv) contract providers, are not optimal resulting in limited purchasing capacity. The lack of autonomy of the HIOs, combined with insufficient quantity and quality of staff (e.g., to review claim and ensure proper quality monitoring) and deficient purchasing procedures need improvements.

State funds budgeting, allocation, and control are entirely budget line item-based leading to complete passive purchasing of health services. This is mostly based on historical budgets poorly linked to actual cost and volume of services and inefficient resources allocation. The lack of coherence between Ministry of Health (MOH) policies and state funds budgeting and allocation reinforces the passive nature of services purchased with state funds and does not provide incentives for health providers to deliver more rational care (e.g., penalizing the excess use of antibiotics by withholding payments). The performance assessment system for budget managers and providers established for over a decade is not effective, i.e., results of assessments have no real effect on resource allocation.

Out-of-pocket expenses in the health sector are very high caused by weak purchasing practices; excessive admissions; over prescription of drugs (cost of drugs is poorly reimbursed except for in patients); unregulated setting of tariffs (fees) leading to abuse; ceilings imposed by health insurance on reimbursement of diagnostic tests; and gaps in benefit packages (e.g., high cost services). State budget and health insurance funding have increased substantially and nominally over the last decade but government health spending as a proportion of total public spending and as a proportion of gross domestic product have dropped. Overall, high out-of-pocket expenses coupled with inefficient resource allocations in the sector result in limited financial protection for Mongolians against ill-health despite very high health insurance coverage (95%).

Impact Health status of Mongolians improved
Outcome Strategic purchaser model approved and initiated
Outputs

Strategic purchasing model defined

Government and health care provider capacity and capability for strategic purchasing implementation strengthened

Institutionalization of the strategic purchaser initiated

Geographical Location Nation-wide
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services A consulting firm will be engaged to provide a total of 21 person-months of international and 60 person-months of national consultants' inputs.
Responsible ADB Officer Tajima, Eisuke
Responsible ADB Department East Asia Department
Responsible ADB Division Urban and Social Sectors Division, EARD
Executing Agencies
Ministry of Finance (formerly Ministry of Finance and Economy)
S.Danzangiin Gudamj 5/1, Zasgiin Gazriin
II Bair, Ulaanbaatar 15160 Mongolia
Ministry of Health (formerly Ministry of Health and Sports)
1st Floor, Government Building VIII
Olympic Street 2, Ulaanbaatar
Mongolia
Timetable
Concept Clearance 06 Sep 2018
Fact Finding -
MRM -
Approval -
Last Review Mission -
Last PDS Update 07 Sep 2018

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Procurement Plan

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