State communal enterprise on the righteconomic managment "High medical college" akimat of Astana city

State license KZ42LAA00007690 from 24.10.2016

Mandatory social health insurance

The abstract of the presentation on introduction of mandatory social health insurance

The Ministry of health and social development of the Republic of Kazakhstan (hereinafter – the Ministry) has developed conceptual approaches for the introduction of mandatory social health insurance (hereinafter – OSMS) in Kazakhstan.

Закон РК «Об обязательном социальном медицинском страховании»

nalysis of the current situation

Currently in the health care system there are 3 key system problems:

The lack of solidarity of citizens and employers in health protection. The burden of health lies solely with the state. Citizens typical consumer attitude to health care, there is a weak commitment to a healthy lifestyle.
The financial instability of the system. Lack of effective structure of rendered medical care, a high proportion of expenditure on inpatient care. The high proportion of shadow payments of the population (37.4 per cent of total health care costs in the OECD – an average of 17%). There is a fragmentation of financial flows.
Inefficient management of the system. Low efficiency of medical organizations. Weak tariff policy and non-transparent allocation of funds. The low level of service quality and the competence of the system.
In the industry remain the main systemic risk:

growth of consumption of services
the risk of rising cost of health care
the risk of deficiency of the state budget and the possibility of compensation
the risk of failure – not achieving the end results.
Existing key issues and expected systemic risks require fundamental revision of the model of the health system.

World experience

There are 3 global health model:

state (UK, Spain, Italy, Sweden),

− public insurance (Germany, France, Belgium),

− private insurance (USA).

Most countries combine them than focus on one. The General trend is the convergence of “budget” and “insurance” models: budget adopt insurance principles for allocation of funds. Insurance adopt budget principles for the collection and accumulation of funds.

Also in the insurance system increasing the role of the state.

A clear trend of centralisation and consolidation of MHI funds to increase efficiency, simplify management and reduce the unevenness of distribution of funds.

Global trend: why did you choose the OSMS?

Different income levels does not provide citizens equal access to medical care. The rich will not voluntarily make payments for the poorest citizens. In this regard, the majority of OECD countries have chosen OSMS, which allows you to transfer funds from the less needy to the more needy.

Global trend: why one Fund?

The model of single-payer completely dominated countries
Central and Eastern Europe and recommended by the who.

Advantages of the single buyer:

Solidarity with the reallocation of resources from less needy to the more needy.
A uniform package of medical care and equality of access for every citizen of the country.
The accumulation of all of the insurance risks in one Fund.
Common rules for the allocation of funds across regions and the purchase of medical care providers.
The power of negotiation in the course of strategic procurement and the ability to influence and improve the efficiency of the health system.
The state retains the monopoly as an effective tool to translate national health policy.
Higher efficiency (low administrative costs).
Based on the analysis of the current situation and the positive world experience in the implementation of article 29 of the Constitution of the Republic of Kazakhstan the 80 th step of Institutional reform of the head of state in 2017 Kazakhstan will introduce a mixed system of health financing.

The objectives of implementing the OSMS are as follows:

− achieving social solidarity through strengthening their own health and sharing the burden of public health;

− ensuring the financial sustainability of the system by ensuring system resilience to external factors and increased costs and ensure the transparency and fairness of the system;

− improving the efficiency of the system through the outcomes of availability, completeness and quality of services and ensure high competence and competitiveness of the system.

The basic principles of the OSMS system are: universality, social justice and solidarity.

The introduction of the OSMS in the RK will be a division of functions and roles of the Ministry and FSMS. The fundamental regulatory documents will be identified by the Ministry, FSMS will accumulate and purchase medical services.

The state reserves the right to provide a guaranteed volume of free medical care (hereinafter – SBP): the provision of medical care in socially significant diseases, emergency, ambulance, medical aid, medical aviation and vaccination.

In order to ensure the universal right to health by 2020 “uninsured” citizens is provided under the SGBP outpatient care with outpatient drug provision.

In the framework of the OSMS will be provided:

outpatient care with outpatient drug provision of insured citizens;

stationary medical aid;

high-tech medical services

hospital-replacing technologies;

long-term nursing care.

Voluntary medical insurance will completely or partially cover the cost of the insured person to receive medical care, unexpected system OSMS. VHI gives the opportunity to individuals or employees of large companies surveyed in their clinics and to the terms of service, etc) at the expense of the insurance company.

Sources of health financing in OSMS will be:

− state 4% 01.07.17 – from SMZ-2 years

5% from 2018.

6% in 2023.

7% from 2024 for socially unprotected layers

population (15 categories according to act OSMS);

− employers – 2% in 2017 on income

3% in 2018.

4% from 2019.

5% from 2020.

− employees – 1% 2019 income

2% from 2020

According to paragraph 4 of article 28 of the Law “On compulsory social health insurance” the following citizens are exempt from paying contributions to the Fund:

1) children;

2) mothers with many children awarded “Altyn Alka”, “Kumis Alka” or got before the rank “Mother-heroine” and awarded the order of “Maternal glory” I and II degree;

3) participants and invalids of the great Patriotic war;

4) persons with disabilities;

5) persons who are registered as unemployed;

6) persons who are studying and living in residential institutions;

7) persons enrolled in full-time education in the organizations of secondary, technical and professional, postsecondary, higher education, and postgraduate education in the form of a residency;

8) persons who are on leave in connection with birth of child (children), adoption (adoption) of a newborn child (children) to care for a child (Ren) to achieve it (them) of age of three years;

9) disabled pregnant women and disabled persons actually raising a child (children) until it reaches (them) of age of three years;

10) pensioners;

11) and the military.

12) employees of special state bodies;

13) law enforcement officers;

14) a person serving a sentence in the penitentiary (prison) system (with the exception of minimum security institutions);

15) the persons contained in temporary detention facilities and investigative detention facilities.

However, for military personnel, employees of special state bodies, law enforcement officials will not enumerate the contributions of the state: these categories of citizens will continue to receive service in the institutions of the departmental network.

In accordance with paragraph 3 of article 27 of the Act from payments employers are exempted for the citizens mentioned above.

The social health insurance Fund (FSS) will operate from 1 July 2016 and will serve as a financial operator at SBP and Strategic Purchaser at OSMS.

One of the main functions of OSMS will be the accumulation of funds in the Fund. As international experience shows, in different countries in different ways, the collection and control of funds. In Hungary, Slovenia, Estonia and Latvia it makes the tax service. In Lithuania and Poland state social insurance funds with further transfer to the funds of the OSMS. In Germany, Moldova and Slovenia, the Funds OSMS collect contributions.

It is characteristic that in all these countries, control of the flow is carried out by tax service.

In Kazakhstan, the Fund will be FREE to accumulate contributions and contributions from employees and employers, as well as targeted transfers for SGBP.

Most of the previously financed from the local budget, types of medical care will be transferred to the Fund, which will ensure the unity and quality procedures and will require amendments to the Budget code in the part of interbudgetary relations (exemptions and subsidies).

In accordance with the already existing in the Kazakhstan practice, it is proposed the control of receipts in FSMS to consolidate the state revenue Committee – this approach is used in many countries with a mandatory system of social insurance.

It will also allow to save is already built and working system without creating a duplicate network for collecting premiums – lower administrative costs and greater efficiency.

The Corporation as an Autonomous organization will conduct a personalized account of all revenues.

The exchange of information between the systems of the state revenue Committee and the state Corporation will provide the necessary information will be carried out on a daily basis – this requires completion of the information systems of the SRC on personified accounting of the deductions and contributions (for control and monitoring) and the formation of a single payment of the documents under the appropriate listings.

In many foreign countries, SMS is the main source of health financing. While in almost all countries of. the state reserves the financing of expenses from the state budget, for example, Germany is spending on public health, education, science, the contents of the medical services of power structures, capital investment and operating costs, which constitute about 11% of total health expenditure.

Thus, the forecast of funding OSMS in the Republic of Kazakhstan provides for gradual reduction of funding from General taxes (GB, GBSP) from 32% in 2017 up to 10% by 2020, through contributions in OSMS increase revenues and contributions from 28% in 2017 and to 62% by 2020. All this will impact on private payments that need to be reduced from 36% in 2017 to 25% by 2020.

The package of health services is the main constituent of OSMS.

World experience shows that each country creates packages based on features and characteristics of their countries.

In Germany there is a single and convenient package through SMS. It is also an alternative package of private insurance, which are eligible persons with an income of more than 49.5 million Euros per year (11% of the population). In Lithuania, Poland, Hungary and Moldova there is also a broad and unified package for all insured OSMS. LCA plays a minimal role in these countries.

In the Netherlands we have two package within the OSMS: standard package for the entire population and an additional package for the elderly on chronic diseases, care, etc.

Russia has adopted the state-guaranteed package for all citizens and the basic package under the MLA for the insured citizens.

In Kazakhstan on the basis of the provisions of the Constitution defined: the package for SBP for the entire population and the package of the OSMS for the insured.

In many countries, packages include socially significant diseases. However, they in some countries SPZ a separate list. In Germany and France there are no data on the existence of a separate list of the SPZ. In Lithuania there is no separate list but they are included in the package OSMS, the list of dangerous infected illnesses, the patients which automatically become insured OSMS, included 14 diseases.

In Russia a list of the SPZ consists of 9 separate diseases and the list of especially dangerous diseases 15. In Belarus there is no list of the SPZ, there is a list of dangerous infectious diseases 6 diseases. In our country there are both lists: SPZ – 12 diseases and OHD – 15 diseases. Under OSMS assumes a phased inclusion in the package OSMS socially significant diseases. Currently, all of these diseases included in the list of guaranteed free medical care.

One of the critical issues is the provision of emergency medical care to citizens.

Currently in Kazakhstan there is a list of readings (as patients and victims), which offers emergency medical aid in the framework of the SGBP. But with the introduction of the OSMS state extrene care (acute illness, exacerbation of chronic diseases, childbirth, trauma, etc.) based on good international practice will be reimbursed at the expense of the state budget.

The redistribution of medical care in the framework of the OSMS will be from SBP SMS on the phased rate increase the state contribution for the economically inactive population.

At the first stage from 2017 to 2019, the state budget will provide outpatient care with outpatient drug provision for non-employed population, and 10 species of socially significant diseases will move from SBP in OSMS.

Starting from 2019, with the introduction of universal Declaration of income and expenses of citizens will toughen the requirements to the system OSMS. The citizens themselves will begin to pay contributions to SMS (in 2019 -1% of income, with a 2020 – 2%). It encourages citizens to increase their responsibility to their own health. The government would gradually expand the package of OSMS for the insured citizens.

How to change the purchase of medical services?

Today the Committee of payment of medical services acts as a single payer. The advantage of this are:

Uniform rules for purchase of medical services in the framework of unhs
Access specialized medical care to rural residents
Optimizing hospital bed capacity through the introduction of new technologies.
Tomorrow FSMS will act as a Strategic purchaser. The main advantages of the new system will be:

the accumulation of all funds for the purchase (OSMS + SBP);
purchase of medical care applying the selection of suppliers and influence suppliers in order to improve the system of healthcare optimization and infrastructure);
the implementation of centralized financing for all types of services through its head office FSMS;
the decline in interest of local Executive bodies in improving the healthcare system.
However, there is one drawback of this system is the reduction of interest of local Executive bodies in improving the healthcare system, as all funding will go to FSMS. To mitigate this risk will be concluded agreements/memoranda with the governors of the regions to implement state policy and achieve the target results and indicators of health.

With the introduction of the new system has also been studied the best international practices of European countries.

The new system of procurement of medical services will operate as follows:

sourcing and purchasing of health services will be via a two-stage model according to the Unified rules of Contracting, approved by the Ministry of health and social development of Kazakhstan;
FSMC acts as a strategic purchaser of services within the OSMS and SBP;
the scheme will be built on the basis of an integrated e-health systems and information systems of all medical organizations – systems upgrade is already started;
medical organizations that do not have their information systems and the possibility of their creation, receive the keys of access to the e-health system to work in it in the personal Cabinet;
thus, the whole process except for the negotiation part, be automated;
the information in the unified register of suppliers will also be automatically updated, including when the update of the database on positive and negative ratings suppliers such ratings will be formed FSMS the evaluation of quality of rendered services;
unique providers of health services (highly specialized, high-tech) can be utilized outside of the schema method from the same source.
To implement common rules of procurement and payment services, and quality control, all previously funded from the local budget, types of medical care will be transferred to the Fund by SMS. In this connection, you need to make changes to the Budget code in the part of interbudgetary relations (exemptions and subsidies).

Expenditures of the Republican budget in 2017 will amount to 2.25 billion tenge (for treatment abroad, promote healthy lifestyles, aid with use of innovative technologies). Zalewie current transfers to the regions will amount to 14.4 billion tenge (purchase of vaccines, prevention of HLS). The local budget remains the funding of other services and activities in a total amount of 22.7 bn tenge (the child’s home, spetsnaznachenija, medcollege, etc.).

The Fund will Finance FREE medical services to the extent 502,2 billion tenge, including the POI package OSMS as a Strategic purchaser in the sum of 359.8 billion tenge (APP, ALO and SMP).

Means SBP will be financed through FSMS as a financial operator in the amount of 142,4 billion tenge:

The AMS and ALO (not entitled to medical care in OSMS) to 10.9 billion tenge.
Emergency inpatient care (not eligible for medical assistance in OSMS) – 6,6 billion tenge.
Emergency inpatient care (observation for up to 24 hours, a short stay in the emergency Department of hospitals (up to 3 hours) in the pilot regions) – 1.9 billion KZT.
ALO SPZ – 24,5 billion tenge.
5. Oncology – 21.8 billion tenge. (HELLO, expensive BOS – 7.7 billion tenge, medical care – 19.7 billion tenge).

6. Aid for the SPZ – 47 billion KZT.

7. Emergency medical service and sanitary aircraft of 22.9 billion tenge.

Other services – 8,1 billion tenge. (production of blood, its components and preparations 7.3 billion Tg., services PUB 0.8 billion tenge.
9. Reimbursement of the lease payments – KZT 0.6 billion.

In addition, some priorities will change funding scheme. Currently there are 10 medical organizations which are carrying out transplantation. It is proposed to conclude a long-term contract for 3 years with the possible annual changes in the types of assistance provided and the prices set for this year is to purchase them from one source for 3 years.

Rural district hospitals and clinics will be combined into a single structural unit. Will be implemented for outpatient medicines at the PHC level. In these organizations, are invited to go on the principle of reimbursement.

Will change the scheme of payment of medical services.

Currently in Kazakhstan medical organizations-contractors daily in automated mode provide information on cases treated in hospitals in the format established by the authorized body in a COMA. Affiliates to WHOM and CCMPA according to the order of MHSD check the volume and quality of services. Further branches WHO provide the need funds in a COMA MHSD. WHO of health allocates funds to the branches for subsequent transfer on settlement accounts of medical institutions.

Examining the positive international experience in the new system assumes:

All types of care provided will be financed through the Fund:
− SGBP – all types of medical care (Fund operator)

− OCMC – all types of medical care (the Foundation as a purchaser)

Medical organizations-contractors every day in automated mode, will provide information that will be available both to affiliates of the Fund and the Fund itself. This will provide an opportunity for daily monitoring and spot checks on the services provided to the population across the country.
The total need will be provided to the Fund, to the 25th day of each month.
The head office of the Fund, based on the data of branches and advice of the relevant structural units of the Fund, lists centrally funds in the settlement account of the medical organizations (the same as now SCPP)
Will undergo changes and tariff policy in the purchase of medical services:

Tariffs are now calculated under the state institutions and do not provide for repayment of investments will be revised and will reflect the real cost structure, including capital costs and depreciation, maintenance of medical and it technologies, the cost of financial services and other expenses:

this will create opportunities for the development of medical organizations, will move from the practice of strict control of volumes to the monitoring system;
will stimulate the attraction of private medical organizations to provide services under GOMBE and OSMS, will increase the interest of private capital in entering the healthcare market, including PPP;
to focus healthcare organizations on prevention and the expansion of inpatient care.
Payment methods medical services will be improved:

1) primary health care – through head-count ratio;

2) consultative and diagnostic services through tariffs for services;

3) emergency – number of calls;

4) emergency room (upon delivery of the patient by the ambulance);

− a single average tariff for wider consultation;

− 67% of the AlMg when finding a patient in the emergency room longer than 24 hours;

5) hospital-replacing help – 25% of the AlMg in a hospital, 17% of the AlMg with the home care;

6) inpatient care 100% of the AlMg for each treated case.

The implementation of the OSMS will improve the quality of medical services. Already established joint Commission on quality of care (experience of Germany), which regulates the issues of standardization of clinical protocols of diagnostics and treatment, medical education, drug supply, the accreditation of healthcare organizations. This organisation includes members of the public, associations of medical organizations and societies of doctors and pharmacists of Kazakhstan, representatives of the medical business.

The introduction of the OSMS parameters for quality assessment will be revised and will include:

1. Parameters for quality assessment will be revised and will include:

(a) patient safety;

b) clinical effectiveness;

C) economic efficiency;

d) achievement of target indicators and indicators providers of medical services.

2. CCMPA will undertake state control, including:

monitoring compliance with standards in the field of health;
verification of deaths, including at the request FSMS;
to check complaints.
3. The Fund will carry out checks on the basis of a contract with madagasikara, including:

examination of the volume and quality of treated cases;
examine the validity of the appointment of drugs and medical devices;
the monitoring indicators of the final result of suppliers ‘ activities.
4. By results of checks, the Fund will develop a database of medical organizations having a positive and negative ratings.

One of the main functions of OSMS is to ensure its financial sustainability. Studied the experience of Lithuania, Slovakia and Russia, where the OMC operates for quite some time. On the basis of international experience within the OSMS to ensure its financial stability provides:

1. Under the OSMS to ensure financial stability provides:

(a) the state contribution will be made from the official average salary of the year before (i.e. 2017 does the indicator 2015). They provide an opportunity to offset government loss system OSMS in cases of economic downturn.

b) investing in the standard set of financial instruments through the national Bank;

C) propose to form the following reserves:

reinvestiruet monthly minimum balance in the amount of not less than 50 billion tenge;
provisions for contingencies in the amount of 3% of total contributions and deductions to the Fund for FREE;
working capital to cover monthly invoices submitted for the current month, after 25-th, and in cases of excess of volume of the provided services compared to the volume specified in the contract.
With the introduction of the new system OSMS key functions of the Ministry of health and its committees, and FSMS will be demarcated the legislative level.

All business processes FSMS identified and measures for their implementation.

The implementation of the OSMS is carried out in conjunction with the reform of the health system in Kazakhstan. In January 2016, the Head of the state N. Nazarbayev approved the State healthcare development program “Densaulyk” for the years 2016-2019, which provides the main tasks and directions of development of the industry.

Also, the implementation of the new joint with the world Bank new project “Social health insurance: increasing access, quality, economic efficiency and financial protection” for 2016-2020 to ensure the sustainable development of OSMS in Kazakhstan.