Key Features of Mandatory Social Health Insurance Fund in Kazakhstan

IMPLEMENTATION OF MANDATORY SOCIAL HEALTH INSURANCE KEY FEATURES OF SOCIAL HEALTH INSURANCE FUND IN KAZAKHSTAN

BASIS FOR IMPLEMENTATION OF MANDATORY SOCIAL HEALTH INSURANCE (MSHI) Steps 80. Implementation of mandatory social health insurance. Strengthening financial sustainability of the health system through the principle of mutual responsibility of the state, employers and citizens. Priority financing of the primary health care. Primary care will be the core of the national healthcare for prevention and early fight against diseases. The 100 specific steps The State Health Development Program Densaulyk for 2016-2019 Direction 4: Improving the health care system through the introduction of solidarity and enhance its financial sustainability 2 2

STRUCTURE OF HEALTH EXPENDITURES DUE TO INSUFFICIENT FUNDING OF STATE GUARANTEED BENEFITS PACKAGE, CITIZENS ARE FORCED TO BEAR SIGNIFICANT HEALTH EXPENDITURES HEALTH EXPENDITURES DYNAMICS (M KZT) Total health expenditures in Kazakhstan 940,1 (3,7% of GDP) are significantly lower than in countries with same level of development (6% GDP). The share of private expenditures on health is 41% that is twice higher than recommended by WHO (20%) More than 30% of private expenditures are spent on procurement of self-paid health services declared within SGBP framework. State guaranteed benefits package deficit in 2017 362,5 bln KZT 887.7 729.3 679.7 677.6 608.1 542.2 maximum threshold 373.9 362.5 317.4 279.4 268.3 260.2 248.2 237.6 2013 2014 2015 2016 2017 (National health accounts for 2017, preliminary report) SGBP deficit " " Out-of-pocket expenditures Expenditures on SGBP 3 3

DYNAMICS OF CHANGES IN SOCIAL PAYMENTS 14.0% 13.0% 12.0% As the result of the legislative decrease of social payments by 1,5% before 2025, total burden on employees payroll does not increase before 2020 After 2020, employee payroll s burden gradually increases from 0,5% to 1,5% EMPLOYERS' CONTRIBUTIONS EMPLOYERS' CONTRIBUTIONS 11.0% 10.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% SALARY SHARE) ) 9.0% ( (SALARY SHARE 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 8.0% 6.0% 6.0% 6.0% 6.0% 7.0% 6.0% 1.0% 1.0% 5.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 3.0% 2.0% 2.0% 2.0% 2.0% 1.5% 1.5% 1.5% 1.5% 4.0% 3.0% 5.0% 5.0% 2.0% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 3.5% 1.0% 0.0% 2017 6.0% 1.0% 5.0% 2018 6.0% 1.5% 3.5% 2019 6.0% 1.5% 3.5% 2020 6.0% 2.0% 3.5% 2021 6.0% 2.0% 3.5% 2022 6.0% 3.0% 3.5% 2023 6.0% 3.0% 3.5% 2024 6.0% 3.0% 3.5% 2025 6.0% 3.0% 3.5% year year year year year year year year year Contribution to SFSI Social tax Contribution to SHIF Contribution to SFSI Contribution to SHIF Social tax 4 4

HIGHLIGHTING IMPLEMENTATION OF MSHI WHY COMMON FUND? INSURANCE RISKS OF THE ENTIRE POPULATION of Kazakhstan accumulated in a single body Assets distribution by regions DEPENDING ON POPULATION NEEDS. 01 January 2019 Healthcare provision within MSHI framework Procurement of a single services package, equally accessible by EVERY SINGLE CITIZEN OF THE STATE. 01 January 2018 Centralized purchase of GPMC services of Fund 01 July 2017 Start collecting contributions for MSHI Application of COMMON HEALTH SERVICES PROCUREMENT RULES. Direct impact on efficiency improvement of the healthcare system and quality of health services 2016 year Social Health Insurance Fund established 2015 year Signed the Law "On Mandatory Social Health Insurance" 5 5

PROCUREMENT OF HEALTHCARE SERVICES WITHIN THE FRAMEWORK OF GSBP PRIVATE SUPPLIERS INCREASE IN PROCUREMENT OF HI-TECH HEALTH SERVICES CONTRACTED PROCUREMENTS OF HI-TECH HEALTH SERVICES Enrolled Enrolled 1 434 from healthcare subjects pretending to provide health services in 2018 1 434 applications applications Approved Approved 398 applications applications (61%) (39%) Private organizations 63 1 1 398 Governmental organizations 97 Total: 160 organizations HEALTHCARE SUBJECTS HEALTHCARE SUBJECTS contracted for procurement of health services BUDGET ALLOCATED ON HI-TECH HEALTH SERVICES YEAR YEAR 2017 2017 2018 2018 (47%) Private organizations 26,70 bln KZT (53%) Governmental organizations 31,40 bln KZT Total, including: 1 226 1 992 Private 447 681 Total: 58.1 bln KZT 6 6

MSHI POPULATION COVERAGE As the result of Single cumulative payment s implementation, MSHI can deliver health coverage to self-employed and informally employed population providing a choice opportunity between payment of SCP and contribution to Social Health Insurance Fund POPULATION BY CATEGORIES WITHIN MSHI FRAMEWORK IN 2018 Sole proprietorship and Individuals with the right of economic management 1,09M people MSHI payment Employed (by PIN) 5,38M people 5% of legislative minimal wage Single cumulative payment (SCP) 1 monthly calculation index (MCI) - 2 525 KZT in 2019, 40% of which are allocated to MSHI: 1 010 KZT for urban area 505 KZT for rural area Inactive (not exempt) 1,43M people State-paid categories 10,19M people Military 0,21M people AS THE RESULT OF SCP S IMPLEMENTATION, IT IS POSSIBLE TO PROVIDE HEALTH COVERAGE TO APPROXIMATELY 500 THOUSAND MORE PEOPLE DUE TO THE FOLLOWING SOCIAL CATEGORIES: Sole proprietorship with simplified tax return 100k people Sole Informally employed 300k people proprietorship by licensing 100k people 7 7

NEW MODEL OF SGBP WITHIN THE FRAMEWORK OF MSHI MSHI package (for insured citizens) healthcare to improve quality of life of every person, foundation for the future generations health ADDITIONAL SERVICES: paid services, voluntary health insurance, co-payment 1. Diagnostics 2. Outpatient , 3. Day care for diseases on top of SGBP 4. Planned inpatient care for diseases on top of SGBP 5. Rehabilitation for adults and children by following categories: cardiology. cardiosurgery, neurology, neurosurgery, traumatology, orthopedics. drug provision for MSHI PACKAGE: atop SGBP and new services New model complies with WHO concept of universal health coverage NEW SGBP MODEL For For all all citizens 1.Emergency care and air medical services 2.Primary care 3.Emergency day care and inpatient hospital treatment 4.Palliative care For For people people with with socially socially significant significant and 1.Diagnostics 2.Outpatient drug provision 3.Planned day care and inpatient hospital treatment 4.Rehabilitation for patients with TB citizens NEW SGBP MODEL: basic health services and major major chronic chronic diseases diseases SGBP will associate with minimal social standard (The law of the RK About minimal social standards and their guarantees Simultaneous introduction of both new SGBP model and MSHI system 8 8

PATIENT OPPORTUNITIES WITHIN THE FRAMEWORK OF MSHI 1 2 3 AIMS OF SHIF Extend primary care facilities network, including means through private suppliers Deliver accessible city outpatient and inpatient hospitals for people from rural areas Facilitate effective competition among health suppliers and develop patient-oriented healthcare 1 2 3 4 5 Register to primary care facility of choice Provide a free choice of general practitioner Improve the access to a free choice inpatient facilities for planned hospitalization Deliver affordable expensive diagnostics, such as MR-imaging, CT, laboratory examinations, etc. Participate in the processes of quality control and remuneration of health services 9 9

THANK YOU FOR ATTENTION! 10 10