Complementarities between social protection and health care policies: Evidence from the Productive Safety Net Program in Ethiopia

1. ETHIOPIAN DEVELOPMENT
RESEARCH INSTITUTE
Complementarities between social protection and
health care policies:
Evidence from the Productive Safety Net Program
in Ethiopia
Kalle Hirvonen (IFPRI-ESSP)
with
Anne Bossuyt (UNICEF Ethiopia)
Remy Pigois (UNICEF Ethiopia)
6 October 2017

2. This study is funded by:

3. Background
• Social protection policy encompasses multiple sectors; from
food security programs to social services
• In Ethiopia, the 2014 National Social Protection Policy lists 12
active social protection programs:
Social insurance programme (pension);
Food security programme;
Provision of basic social services; National nutrition programme;
Support to vulnerable children; Health Insurance;
Disaster risk management; Support to persons with disabilities;
Support to older persons; Urban housing and grain subsidies;
Employment promotion;
Community ‐based social support

4. Background (2/2)
• But often we (researchers, policymakers) focus on one policy
or programme (e.g. PSNP) but do not consider how these
programs interact with or complement each other
• Households in Ethiopia are likely to benefit from multiple
social protection programmes at the same time.
• Therefore, better understanding how different programs
interact with or complement each other is important so to
maximize the welfare impacts on the recipients.

5. Focus here
• We explore these issues by focusing on three major
social protection programs in the Ethiopian
highlands:
o The Productive Safety Net Programme (PSNP)
o The Community Based Health Insurance (CBHI)
o The Health Fee Waiver (HFW) system

6. The Productive Safety Net Programme (PSNP)
• Began in 2005 in Amhara, Oromia, SNNP and Tigray. Later
expanded to Afar & Somali regions + Harari & Dire Dawa.
• Public works for households that have the capacity to work.
• Direct support for households that have limited labor capacity.
• Mix of geographic and community-based targeting to identify
chronically food insecure households in chronically food insecure
woredas. IFPRI evaluations show that PSNP is well targeted.
• 7 million beneficiaries that receive either food or cash payments.
• Currently in its fourth implementation phase and operates in 330
food insecure rural woredas in eight regions of the country.
• Has been subject to considerable amount of research since it
began; IFPRI-led evaluations + other research.

7. Community Based Health Insurance (CBHI) (1/4)
• Pilot phase in 2011 in 13 woredas in Amhara, Oromia, SNNP and
Tigray
• Expanded to 185 woredas in 2014/15 and to 191 woredas in
2015/16
• Focuses on rural households (& urban workers in informal sector)
• Enrollment is voluntary in two levels: 1st Kebeles decide, then
households decide whether to enroll or not.

8. Community Based Health Insurance (CBHI) (2/4)
• Enrolled households pay an insurance premium – which, on
average, equaled to less than 1.5 percent of household
monthly non-medical expenditures during the pilot phase
(Yilma et al. 2015).
• Health insurance covers both outpatient and inpatient health
services at public facilities. Private facilities is only allowed if
the particular service or drug is not available in public
facilities.
• CBHI has targeted subsidies for the poorest households;
defined as “indigents”. Community targeting with minimum
of 10% of CBHI eligible households.

9. Community Based Health Insurance (CBHI) (3/4)
• The pilot scheme was extensively evaluated by local and foreign
researchers. This helped in re-designing and scaling up CBHI.
• Some key findings:
o High enrollment rates (>40 %) and high re-enrollment rates (>80%).
o Increased disposable income and decreased the likelihood that the
household had to borrow (Yilma et al. 2015). But: no evidence that
affected consumption outcomes or livestock holdings
o Mebratie et al (2014) suggest that CBHI did not reduce out of
pocket health expenditures (OOP). Ethiopian Health Insurance
Agency (2015): CBHI households incurred OOP.
o No evidence of social exclusion (Mebratie et al 2015). Shigute et al
(2017): PSNP households 50% more likely to enroll into CBHI.

10. Community Based Health Insurance (CBHI) (4/4)
• But no research on CBHI after the pilot
➢ The Pilot woredas were purposely selected
o Do these findings from the pilot stage reflect the reality on
the ground during the expansion phase?

11. The Health Fee Waiver (HFW) system
• The health care policy has traditionally maintained a strong
social protection dimension in Ethiopia.
• To this end, for decades, the select number of the poorest
households have been exempted from paying for certain basic
health services.
• This health fee waiver system is still operational in woredas in
which the CBHI has not yet been rolled out.
• In woredas in which the CBHI is operational, the ‘indigent
scheme’ replaces the health fee waiver scheme.

12. Approach (1/2)
• Use PSNP-4 baseline data collected by the CSA (with support
from IFPRI) in Jan-February 2016.
• Restrict the analysis to Amhara, Oromia, SNNP and Tigray
o CBHI did not operate in Afar & Somali regions in 2016.
• The final sample used in this study is 6,739 households that
group into 81 woredas and 243 kebeles.
• About half of the households are PSNP beneficiaries and half
are poor households that do not benefit from the PSNP.
o Data not nationally representative. If anything:
representative of poorest population in PSNP woredas.

13. Approach (2/2)
• Roadmap:
1. Study the coverage of CBHI and health fee waiver
schemes in the PSNP woredas.
2. Calculate the annual out-of-pocket health care expenses
incurred by poor households in these woredas.

14. Managing expectations
• This research contains no fancy statistics, nor does it attempt to
uncover causal pathways
• Rather, this is a purely descriptive analysis of the overlap between
PSNP, CBHI, HFW
• The purpose of this study is two-fold:
1. To provide some (hopefully) useful statistics for the
policymakers on this topic
2. Guide the design of future research in this area (next PSNP
survey in 2018)

15. PSNP and CBHI overlap
• Out of the 81 PSNP woredas in our sample, CBHI is operational in 27
woredas (33%)
o About 30 % in Amhara, Oromia, SNNP; 41% in Tigray
• Within these CBHI-PSNP woredas, % of households enrolled in CBHI:

16. % of households enrolled in CBHI as an ‘indigent’
• About 10 % of all households in the CBHI-PSNP woredas did not have to pay
for the insurance premium
• Comparing this to previous table --> 45 % of CBHI households are ‘indigents’
o But remember, the sample is biased towards poor households
• PSNP and non-PSNP shares very similar
o Interesting because both operate with community-based targeting so
criteria seems different

17. Overlap between PSNP and HFW
• Now focusing on the 54 PSNP woredas in which CBHI does not operate
• About 4 % of all households in non-CBHI-PSNP woredas received HFW
• PSNP and non-PSNP shares similar
o Again, targeting criteria seems different between PSNP and HFW

18. % of HHS with out of pocket health care expenditures
• Considerable portion of poor CBHI / HFW households incurred health care
expenditures
• The mean OOP among households that incurred them is 183 birr (median=60)
which is about 5 % of total annual expenditures (18% of non-food expend).
• Among CBHI households: mean 237 birr (median 60 birr)

19. Catastrophic Health Expenditures
• WHO (2010) defines health spending as catastrophic if it exceeds a certain
percent of the total expenditures.
• Still, there is no widely accepted threshold on what constitutes a
catastrophic health spending in the literature.
• We follow health economists: 10 percent of the total annual expenditures.
• 4.8 % of households incurred catastrophic HE
• No difference between PSNP & non-PSNP
• CBHI HHs: 3.9 % (4.4 % non-CBHI HHs in CBHI woredas)
• HFW HHs: 4.6 % (5.0% non-HFW in non-CBHI woredas)
• Van Doorslaer et al. (2007): In Asia shares range between 2% (Malaysia)
and 15.6% (Bangladesh)
• Chuma and Maina (2012) calculate that 23 % of the poorest (lowest
quintile) households in Kenya had catastrophic health expenditure levels.

20. Summary of the main findings (1/3)
• CBHI operates in about one-third of PSNP woredas in
the highlands
• In these woredas, about 22 % of all PSNP beneficiary
households are enrolled in CBHI.
o This could be higher considering that we’re talking
about the poorest households in these localities
that could benefit from health insurance
o Maybe premiums too high for these poor
households? ( --> more research needed)

21. Summary of the main findings (2/3)
• In contrast to the research from the pilot phase: no
evidence that PSNP households are more (or less) likely
to enroll in CBHI
• 44 % of PSNP households enrolled in CBHI did not have
to pay the insurance fee (= ‘indigents’)
• This share is very similar among poor non-PSNP
households
o Suggests that selection criteria of PSNP and indigent
households are different ( --> more research
needed)

22. Summary of the main findings (3/3)
• Nearly 40 % of these poor households incurred out of
pocket health expenditures
• For 5%, OOP can be characterized as catastrophic
• Considerable share of CBHI and HFW households
incurred OOP, and 4-5 % had OOP at catastrophic level
• Why is this happening? --> more research needed

23. Conclusions
• Research generally shows that major social protection programs in
Ethiopia are achieving their objectives
• This research suggests that more work could be done to harmonize these
programmes
o To ensure that maximum benefit from these programs can be
achieved
• Extending the geographical coverage of the CBHI to all PSNP woredas
could be the first step.
o But: low enrollment rates among poor households in these localities
needs to be addressed
▪ Maybe increase the indigent provisions in PSNP
woredas/kebeles?
o Also: CBHI enrolled households still incur OOP
▪ Need to understand better why this is occurring
Interested in our work? -- Check: http://essp.ifpri.info