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Fiscal sustainability and transition - Azerbaijan


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This presentation was made by Azerbaidjan at the 3rd Health Systems Joint Network meeting for Central, Eastern and South-eastern European Countries held in Vilnius, Lithuania, on 25-26 April 2019

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Fiscal sustainability and transition - Azerbaijan

  1. 1. - Health financing reforms and introduction of a mandatory health insurance - Procurement mechanism to reduce the cost of and the increase the quality of the drugs 25- 26 April 2019, Vilnius, Lithuania
  2. 2. 2 Demographic indicators ▪ Gender ratio (2018) 0.99 males/female ▪ Population up to 14 years (%, 2018) 22.6 ▪ Population between 15-64 years (%, 2018) 70.9 ▪ Population over the age of 65(%, 2018) 6.5 Development indicators Basic information ▪ Total population (mln, 6 April 2019) 10 ▪ Population growth (annual %, 2018) 0.9 ▪ Birth rate (per 1,000 population, 2017) 16.3 ▪ Total area (thousand sq kms) 86.6 ▪ Life expectancy at birth (2017) 73.1 years (m) 77.8 years (f) ▪ GDP per capita ($, PPP, 2016) 17,398 ▪ Below-poverty-line population (%, 2016) 5.9 ▪ Healthcare expenditures in 2019 (mln USD) 616.6 ▪ Healthcare expenditures constitute 4.2 % of state expenditures Turkey AZERBAIJAN HEALTHCARE OVERVIEW Azerbaijan is a middle-income country with almost 94% of its population living above the poverty line
  3. 3. 3 Productivity per doctor 28 58 2016 2017 +108% 17 48 2016 2017 ×2.8 Activity per doctor increased by 108% due to: ▪ Consolidation of workforce and assets and thereby higher demand per doctor ▪ Higher salaries and incentives Activity per bed increased by 2.8 times due to: ▪ Consolidation of assets (closing down beds) ▪ Change of incentives for providers to reduce average length of stay # of inpatient cases # of inpatient cases Inpatient cases per bed 37% increase in inpatient activities Bed occupancy rate 45% to 65% Avg. length of stay 9.6d4.9d 19% doctor reduction Number of beds 612300 Overview – effects of the reform in 2017 in Mingachevir
  4. 4. 4 ▪ Everyone, sick or healthy, contributes for the well- being of all ▪ No one has to worry about himself, his child, or his relatives ▪ Everyone receives – the right treatment – at the right time – in every hospital in the country – without any financial hardship Targets: ▪ Share of out-of-pocket spending will reduce ▪ Catastrophic expenditure on health will decrease ▪ Impoverishing expenditure on health will decrease ▪ Delay in care among population will reduce The healthcare reform has a bright vision for the population as a whole Azerbaijan healthcare vision
  5. 5. 5 Current Healthcare system of Azerbaijan Patients Regulators Purchasers Providers Sources of Funding Ministry of Health Ministry of TaxesMinistry of Finance Employers Employees Self-employed Income taxes, VAT, etc. Private Health Insurers Voluntarily contribute to Population Provide services Formal and informal OOP Local executive powers Other government bodies1 Transfers Regulates Transfers Reimburse for additional care Private providers and pharmacies Ministry of Health Providers Other public providersRegional hospitals Ministry of Health
  6. 6. 6 Target Healthcare system of Azerbaijan: Provider, Purchaser and Regulator separation option Patients Regulators Purchasers Providers Sources of Funding Ministry of Health Ministry of TaxesMinistry of Finance MHI Agency Transfers Employers Employees Self-employed Mandatory contribute to Purchases covered services Reimburse for additional care Regulates Economically inactive population1 Transfers contributions Subsidizes Population Provide services Formal OOP for non-covered services Private providers and pharmacies Provider authority Voluntarily contribute to Private Health Insurers
  7. 7. 7 Efficiences in procurement for TB, HIV and Hepatitis C medicines and diagnostics In 2018, the Ministry of Health of the Republic of Azerbaijan joined to an international drug procurement platform. As a result, an agreement was signed between the Ministry of Health of the Republic of Azerbaijan and the United Nations Development Program which covers 2018-2020 years. The purpose of this project is to provide quality services to the population of Azerbaijan through the purchase of reagents and medicines for the fight against HIV/AIDS, TB and Hepatitis C.
  8. 8. 8 State programs and measures In 2019 136.4 mln USD of healthcare expenditures were directed to financing targeted programs and measures: - Measures to treat diabetes – 26 mln USD - Measures on fight against cancer – 24.2 mln USD - Measures to combating chronic renal failure – 17.7 mln USD - Hemophilia disease program – 7.2 mln USD - State program on fight against thalassemia – 6.6 mln USD - Fight against malignant blood diseases – 3.9 mln USD - Immunoprophylaxis of infectious diseases – 3.8 mln USD - Other healthcare measures – 47 mln USD