Health Financing Reforms for Universal Health Coverage in Kazakhstan

Intercountry Conference on partnership collaboration: Health financing reforms for Universal Health Coverage 19 20 June 2018, Astana, Kazakhstan NHA: health expenditures in Kazakhstan Zarina Temekova Republican center for health development Center for Health Economics

Indicators of expenditure on health Current health expenditure as% of GDP National Health Accounts Public expenditure on health as% of GDP Per capita expenditure on PPP S y s t e m o f H e a l t h A c c o u n t s ( S H A 2 0 1 1 ) OOP as% of GDP Suppliers Services Financing schemes Sources of financing

Country Priorities 47.0 40.9 39.7 36.0 expenditures Public 31.0 28.2 21.8 8.2 6.9 GDP 9.4 5.4 7.8 6.3 4.5 Private sector Government revenue 2010 2011 2012 2013 2014 2015 2016 Health sector financing 4.0% 3.8% 3.8% 3.6% 3.6% 3.6% 3.4% 3.4% CHE of GDP 3.0% 3.0% 2.9% 2.7% 2.7% 2.7% THE of GDP 2010 2011 2012 2013 2014 2015 2016

Current health expenditures in 2016 were 1,6 trillion tenge or 3,4% of GDP 10 8.9 8.6 8.5 8.2 9 7.7 7.6 7.3 8 6.9 6.7 6.7 6.5 6.4 6.3 7 5.8 5.7 5.6 6 4.3 5 3.4 4 3 2 1 0 Health expenditures per capita in 2016 were 280 USD* (90,8 thousand tenge) or 468,5 USD in PPP In OECD countries minimum = 1088 USD in PPP, Turkey 2835 2776 2734 2729 3000 2515 2187 2150 2101 2500 1989 1977 1970 1798 2000 1466 1351 1500 1088 1080 1000 469 500 0 *Weighted average official exchange rate according to the National Bank of the Republic of Kazakhstan in 2016 - 342.16

Priority to health in public spending: is a political choice! Share of health spending within government budget WHO/EUROPE countries with population > 600,000 (2015) 30 Domestic General Government Health Expenditures as % General 25 High income Upper-middle income Lower-middle income 20 Government Expenditures 0 5 10 15 15 10 5 0 Bosnia & Bulgaria Romania Serbia Belarus Latvia Greece Lithuania Slovakia Cyprus TFYRM EURO average Sweden Poland Austria Montenegro Hungary Turkey Portugal Italy Finland Tajikistan Ukraine Uzbekistan Estonia France Belgium Armenia Turkmenistan United Kingdom Germany Croatia Czech Republic Spain Denmark Georgia Kazakhstan Ireland Netherlands Switzerland Russian Federation Slovenia Norway Kyrgyzstan Azerbaijan Republic of Moldova Albania Public health exp. 899 bln.tg. (10% of state budget). However, the small size of the state budget (22% of GDP) leads to a low level of state financing of the industry (2.2% of GDP) Source: WHO, GBDD, April 2018.

Relative to size of their economies, EU governments spend a lot on health 10 High income 9 General Government Health Expenditure as % GDP Upper-middle income Lower-middle income 8 0 10 20 30 40 50 7 6 5 4 3 2 1 0 Bosnia & Latvia Romania Lithuania Serbia Belarus Greece Cyprus Bulgaria Slovakia Sweden TFYRM Moldova Austria Poland Turkey Hungary Portugal Italy Finland Tajikistan Russia Estonia Belgium Turkmenistan Armenia Montenegro Czech Republic France Ukraine Georgia Uzbekistan Spain Switzerland Denmark Kazakhstan Ireland Slovenia UK Netherlands Germany Croatia Norway Kyrgyzstan Azerbaijan Albania Source: WHO, GBDD, April 2018..

In 2016 health expenditure structure: public expenditure 59%, private expenditure 40%. 120% 100% 40% 80% 63% 69% 59% 65% 68% 68% 68% 60% Share of private expenditure 40% 27,5% 34% 40% 20% 37% 31% 33% 31% 29% 0% 2010 2011 2012 2013 2014 2015 2016 Private expenditures Public expenditures Ratio of private and public expenditure on health in 2010-2016. 947.78 1000.00 0.80 0.70 738.09783.00 800.00 641.98664.90 0.68 0.60 low income of households 0.58 0.50 low-skilled labor or unemployment 520.36 600.00 0.54 645.62 0.40 402.28 0.46 0.45 0.45 400.00 0.30 456.79 0.42 361.72332.26 0.20 200.00 294.05 235.43 0.10 170.49 0.00 0.00 2010 2011 2012 2013 2014 2015 2016 low level of healthcare services difficulties in access to healthcare services . Public expenditures Private expenditures Ratio of private spending to public

Strong correlation between OOPs as a share of total health spending and financial protection 20% R = 0.65 Where OOPs are <~15% of total health spending, a small share of households have catastrophic OOPs MDA GEO 15% ALB KGZUKR Catastrophic incidence LV PT KZ LT 10% PL EE HU TR 5% SK AT CR CY DE NLFRUK SE SI CZ IE 0% 0 10 20 30 40 50 60 OOPs as % of total spending on health

Life expectancy and health expenditures per capita Life expectancy Expenditure, per capita (USD PPP) Life expectancy and OOP Life expectancy OOP as a % GDP

Higher income associated with less out-of-pocket spending (OOPS). Why? 90 Armenia 80 Azerbaijan Turkmenistan 70 Tajikistan OOPs as % CHE 60 Georgia Albania 50 Kyrgyzstan Moldova Uzbekistan Ukraine Bulgaria Cyprus Latvia Serbia 40 Kazakhstan Greece Russia TFYRM Belarus Montenegro Lithuania 30 Hungary BiH Switzerland Portugal Israel Italy Spain Estonia Poland Romania 20 Finland Slovakia Austria Denmark Germany Netherlands Belgium Turkey Sweden Ireland Norway Croatia Czechia Slovenia UK 10 France R = 0.38 0 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 GDP per capita, PPP $ Source: WHO estimates that 2015, selected countries with a population of more than 600,000 people, the BDPD, April 2018.

Reallocate public spending to health? Health, along with social protection, has already its share increasing, at the expense of other services and now is more than 18% of government spending on average in OECD countries. Change in the structure of govt. spending, OECD average, 2007-15 3 1.5 0 -1.5