This document provides an introduction to health systems. It defines key terms like health, health care, and health systems. A health system is described as an economic system comprised of units, agents, and institutions that interact to adapt, adjust, and achieve coherence in relation to human health. The seven principal health systems are identified as primary health services, workforce, governance, financing, supply chain, information systems, and households. Dimensions for assessing health systems include output, stability, fairness, efficiency, protection, freedom, and innovation. Examples of institutions, adaptations, and coherence mechanisms within health systems are discussed.

1. Introduction to Health
Systems
Lecture 1

2. Outline
• Basic definitions
– Different perspectives on health and health care
– Definition of “Health Systems”
• How the pieces fit together
• Dimensions of functioning
• Syndromes of dysfunction
• Syndromic management

3. Health is A Right
• “… health, which is a state of complete
physical, mental and social wellbeing, and
not merely the absence of disease or
infirmity, is a fundamental human right and
… a most important world-wide social
goal.”
• Alma Ata Declaration-1973

4. Health Comes from Purchased Medical Care
• “No man . . . has a right to medical
care; if he cannot pay for what he
needs, then he must depend on
voluntary charity.”
—Leonard Peikoff, The Ayn Rand Institute

5. Health is due to Social Conditions
• “The improvement of medicine will
eventually prolong human life, but the
improvement of social conditions can
achieve this result more rapidly and more
successfully.”
– Virchow

6. Important Distinctions
• Health vs. Health Care
– Health refers to a state of the human body and
mind
– Health Care refers to chemicals, devices, and
services used by people to improve their
health
• Health insurance
– A system of paying for unpredictable needs for
health care

7. Basic Definitions
• Economic Units
– groups of individuals brought together for a common
purpose
• Economic Agent-
– an individual with a specific role in the system, e.g. a
patient, a nurse, a manager
• Institutions-
– Norms, rules of conduct, established procedures e.g.
property, corporations, paying fines, tipping waiters

8. Definition of systems
• Economic systems
– a collection of economic units, agents, and
institutions that interact coherently; adapting
and adjusting to the social and physical
environment
• (Expect definitions of coherence, adaptation,
adjustment)
• Health systems
– economic systems that are concerned with
human health

9. Adaptation, Adjustment, Coherence
• Adjustment
– transforming and redistributing resources to improve
function, exploit opportunities, resolve weaknesses
within existing institutions
• Adaptation
– evolving or planning new institutions to solve
problems
• Coherence
– Degree to which agents and units coordinate their
activity for common purpose

10. 7 Principal Health Systems
1. Primary health service delivery system
2. Health workforce
3. Leadership and governance to assure quality
4. Health systems financing
5. Supplying medical products and technologies
6. Health systems information
7. Households

11. Mistake 1
• Mistaken to think that the public sector
service delivery system is “the health
system”
• Public sector is never the whole “health
system”
– Leaves out households
– Private finance, Private supply chain
– Private workforce training
• Health systems are plural

12. Mistake 2
• Mistaken to think that
studying health
system means
looking at the
organization chart of
the public sector

13. Understanding Systems
• Analogy: economic
systems are to
society what organ
systems are to the
body
• There is no “system”
there are “systems”
• Dysfunction in one
affects others
• What do systems “do”?
– Adjust
– Adapt
– Cohere
• How do scientists study?
– Reductionism
• Identify institutions
• Examine adaptations etc.
• No best system

14. Some Examples of Institutions
• Households
• Primary health
service delivery
system
• Financial protection
system
• Governance
• Drugs and supplies
distribution system
• Folk remedies
• Clinics
• Insurance
• Licensing
• Markets
• Inventory

15. Some Examples of Adjustments
• Special feeding
• Outreach campaign
• Lowering copay
• New examinations
• Making a drug over
the counter
• Folk remedies
• Clinics
• Insurance
• Licensing
• Markets

16. Pop Quiz
• Which of the following are units in a health
system?
– The neighborhoods in Hanoi
– PEPFAR
– Hewlett Packard
– Medical malpractice courts

17. Examples of Adaptations
• Decentralizing governance
• Starting a government health insurance
program
• Deploying barefoot doctors

18. Examples of Coherence
• Relying on tradition
• Using market signals
• Commanding and
controlling from above
• Motivation is an
essential tool for
coherence
• Examples
– Material incentives
– Moral incentives
– Coercion

19. Power
• Power is relative to the motivations that are
operating in a system
• Examples
– Control of money, titles, space, assets, status
– Power of coercion (different forms of coercion)
– Control of information

20. Exercise
• Reflect on your role in your health system
– Do you have power?
– What form does it take?
– How do you deploy it?
• If your goal were to be in a position to do
the most to improve your health system
– Who would you be?
– Where would your power come from?

21. Instruments
• Direct Controls
– Regulations
– Prohibitions
– Compulsions
• Indirect Controls
– Tariffs/Taxes
– Subsidies
– Grants
• Government as a consumer
• Government as a producer

22. Government Interventions
• Provides
– Provides health insurance
– Provides health care
– Maintains healthy environment
– Informs people about healthy lifestyles
• Sustains
– Funds health research
– Funds health worker training
• Maintains standards
– Licenses health workers
– Approves drugs and devices
– Approves hospital construction

23. Health Policy Mixes Multiple
Objectives
• Objectives about “Health Insurance”
– Protection against the unpredictability of health care expenses
• Objectives about “Health Care”
– Delivers only “costworthy” (efficient) health care
– Equity and fairness in access to health care
– Making health services more respectful, kind, friendly…
• Objectives about “Health”
– A special concern for the health of disadvantaged groups
– A special concern for the health of workers (human capital)
– Financing public goods that affect health
• Social objectives
– Redistribution of income between rich and poor, healthy and sick, powerful
and weak

24. Dimensions to Assess
1. Output
2. Stability
3. Fairness
4. Efficiency
5. Protection
6. Freedom
7. Innovation
• We will study these 7
dimensions across
the many institutions
that make up the 7
major health systems

25. Example 1:
• Health care options for informal laborers
– Commune has one health station with few
supplies and limited services.
– Commune has 2-3 private nurses, doctors,
healers who accept cash or credit for services
– There is limited insurance
– There are limited check ups on the quality of
services and the level of courtesy shown by
providers

26. Dimensions to Assess
• Output
• Stability
• Fairness
• Efficiency
• Protection
• Freedom
• Sovereignty
• Innovation

27. Example 2: VHI
• Health insurance for beneficiaries
• VHI pays providers for care
– Defined benefits package
– Insurance pays government and select private
facilities
• Service quality is subject to regulation

28. Dimensions to Assess
• Output
• Stability
• Fairness
• Efficiency
• Protection
• Freedom
• Sovereignty
• Innovation

29. Summarizing
• Distinguish: Health vs. Health Care vs.
Health Insurance
• Defined economic systems
• Defined health systems
– Agents, Units, Institutions
– Adapt, Adjust, Cohere
• 7 Health Systems
• 7 Dimensions