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Citation Information

Type Working Paper
Title Waivers and exemptions for health services in developing countries
Author(s)
Publication (Day/Month/Year) 2002
URL http://info.worldbank.org/etools/docs/library/80083/SouthAsia/southasia/pdf/readings/day1/aldeman.pd​f
Abstract
In response to shortages in public budgets for government health services, many developing countries around the world have adopted formal or informal systems of user fees for health care. In most countries user fee proceeds seldom represent more than 15 percent of total costs in hospitals and health centers, but they tend to account for a significant share of the resources required to pay for non-personnel costs. The problem with user fees is that the lack of provisions to confer partial or full waivers to the poor often results in inequity in access to medical care. The dilemma, then, is how to make a much needed system of user fees compatible with the goal of preserving equitable access to services. Different countries have tried different approaches. Those which have carefully designed and implemented waiver systems (e.g., Thailand and Indonesia) have had much greater success in terms of benefits incidence than countries that have improvised such systems (Ghana, Kenya, Zimbabwe). Key to the success of a waiver system is its financing. Systems that compensate providers for the revenue forgone from granting exemptions (Thailand, Indonesia, and Cambodia) have been more successful than those who expect the provider to absorb the cost of exemptions (Kenya). Where waiver systems exist, performance will improve with the timeliness of the reimbursement. Other success factors include the widespread dissemination of information among potential beneficiaries about waiver availability and procedures; the awarding of financial support to poor patients for non-fee costs of care, such as food and transportation (as in Cambodia); and the existence of clear criteria for the granting of waivers, thereby reducing confusion and ambiguity among those responsible for managing the system and among potential recipients. Those facing the task of adopting a system of waivers face multiple design options. These include the following, among others: should exemptions be granted to whole groups or on the basis of individual targeting (the review finds that most systems are based on the latter)? Should waivers or exemptions be permanent or temporary? How frequently should eligibility be reassessed? Should waiver eligibility be determined ex- ante, in the household, or when individuals seek care in the facility? The review examines various approaches taken by countries, but assessing their relative practical merits is difficult, as the evidence is scattered and mixed

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