Marginal Budgeting for BottlenecksCarlos Carrera, Health Section, UNICEF

Policy Forum on Child Friendly Budgets for 2010 and Beyond

Fordham University

New York, 18 February, 2010

Global context

Global consensus and ample evidence on high impact interventions to reach health related MDGs…

But progress is insufficient.

Minimum continuum of care package in Africa & Asia

Family/Community Based care Care of the newborn and special care for Low Birth Weight Early, exclusive & prolonged breastfeeding + complementary feeding Use of Insecticide treated nets, safe water sanitation & hygiene practices Oral Rehydration with Zinc for diarrhea Community management of pneumonia, malaria , neonatal sepsis, severe malnutrition HIV/AIDS Prevention & Care; Care & Support for orphans Population Oriented Schedulable Services Micronutrient supplementation and Immunisation of children and mothers Ante- and Post-Natal Care + family planning Preventing Mother-Child Transmission AIDS Individual oriented non schedulable Services Skilled attendance during delivery Case management of diarrhoea, pneumonia, malaria, neonatal sepsis,

severe malnutrition, very low birth-weight, HIV/AIDS and TB Emergency Obstetric and Newborn Care

Main obstacles for progress

Problems at the service delivery level.

Problems at the system or sector level.

Problems at policy-setting level.

Problems at the service delivery level

Continuum of care is breached: Over the life cycle. Over time (high

drop-out rates). Across locations.

Problems at the system or sector level

Poor relation between disease burden and choice high-impact interventions.

Inequitable allocation of financing.Inadequate and unpredictable funding.Poorly trained and undersupplied human resources.

Constraints on supply chain management and capacity.

Problems at policy-setting levelDistortion of national priorities due to excessively

vertical, funding channels. Existing PRS, MTEF, etc. remain insufficiently MDG

oriented in their health-focused components. Fragmentation and large transaction costs from badly

aligned funding channels Poor governance and insufficient accountability for

MDGs- linked to insufficient staffing, expertise and resources to produce results-based plans.

Macro-Level: Policies and Fiscal Space

Meso-level:Health system & other

sectors

Strengthening Services, Systems & Policies for MDGs

MDGs :- Malnutrition- U5MR- MMR- Malaria- HIV/TB- WASH

MDGoutcomes

Micro-level:Families/

Communities

Population

Oriented

services

Individual

oriented

services

Family

behaviours

6. Leadership &governance

5. Health systemsfinancing

4. Medical products

3. Health information system

2. Health workforce

1. Service delivery

· SWAP

Protection of

Household Revenue

Continuum of Care

· Budget Support

· Medium Term Expenditure Framework

· PRSP

MDG focused + Child friendlyNational Health & Nutrition Policies

Health System Building Blocks

Expanding theFiscal &Policy Space:

Family/

Community

based Care

Marginal Budgeting for Bottlenecks (MBB)

Developed by World bank and UNICEF, reviewed by UN agencies and academic institutions.

An evidence-based approach to planning, costing and budgeting. Includes all health related MDGs: 1c, 4,5,6,7. Provides comparative scenarios for country level policy dialogue. Captures the key information about the demography, epidemiology, health

system, intervention coverage and costs. Helps the user analyze the implementation bottlenecks that constrain the

health system, and devise adequate strategies. Estimates the expected increase in coverage and health outcomes obtained

(decrease in mortality, etc.). Calculates the estimated additional (marginal) costs required. Identifies the potential sources and limitation of financial resources (fiscal space).

Strategic policy options analyzed

1. What new actions? (new vaccines, new drugs)

2. For whom? (geographic/poverty targeting)

3. By whom? (public/private partnerships)

4. How? (supply and demand mix)

5. At what item cost? ( drugs, salaries, infrastructure)

6. Who pays? (public, out-of-pocket, donors)

7. How financed ? (PBF, CCT, insurance)

8. How sustained ? (impact of economic crisis on fiscal space)

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Steps in MBB: Results-Based Planning, Costing & Budgeting

Step 1: Analyzing Equity, Health & otherSystems Design and epidemiology To prioritize and Package High Impact Interventions

Step 4: Estimating Marginal Cost of removing bottlenecks

Step 3: Estimating Impact on MDGs 1c,4,5,6,7

Step 2: Analyzing System Wide Supply & Demand Bottlenecks for equitable coverage and selecting strategiesto remove these

Step 5: Budgeting and analyzing Funding sources and Fiscal Space

Bottleneck Analysis

UNICEF

Normal delivery by skilled attendant

0%

25%

50%

75%

100%

Stock ofessential drugsand supplies

Availability ofregisted

midwives inrelation to need

Access tofunctional HC

FunctionalAccess

Deliveries byhealth

professionals

Post natal carevisit

Deliveries byhealth

professionalswith life saving

skills

Basli

ne c

overa

ge

ZZ-Africa TF all countries

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$151.0

$89.0

$48.0

$-

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

$140.0

$160.0

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Comprehensive Medium Focussed

Billio

ns o

f US$

2009

-15

Progress towards MDGs, Marginal Cost, and Fiscal Space

MDG 1 MDG7MDG 6MDG 5MDG 4

intermediate additional

fiscal space

Optimistic additional

fiscal space

MDG 1.BMalnutrition

MDG 5:Reproductive Health

MDG 4Child Survival

MDG 6Communicable Diseases

MDG 7WASH

Budgeting

26

Cost of scaling up health services in Ethiopia : incremental cost per capita 2005-2015 for reaching MDGs

Current Health Expenditures

Step 1

Step 2

Step 3

Step 4

Step 5

0

5

10

15

20

25

30

35

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

US$ (2004 constant $)

Step 5 : Expansion and Upgrade of Referral Care

Further decrease of : child mortality maternal mortality HIV MTC transmission Provision of HAART , multi-drug resistant TB and severe malaria treatment

Step 4: Expansion and Upgrade of Emergency Obstetrical care

Further decrease of : child mortality maternal mortality HIV MTC transmission

Step 3: First level clinical upgrade

Further decrease of: Child mortality Maternal Mortality Malaria, morbidity & mortality TB

Step 2: Health Services Extension Program

Decrease in child mortality Reduction in HIV Mother To Child Transmission Reduction of deaths due to pregnancy by 40% Reduce malaria mortality/ morbidity Reduce Child malnutrition

Step 1: Information and Social Mobilization for Behavior change

Decrease in child mortality due to HIV, malaria, diarrhea diseases Reduced HIV transmission Reduced malaria morbidity and mortality

Evolution of MBB for Results Based Planning, Costing and Budgeting at Global level Africa: “Strategic Framework for MDG 4 and Other Health-related MDG’s in Africa” (WHO,

UNICEF, Word Bank) on request of the African Union and “Results Based Health Sector Plans” (MTEF’s and IHP+ Compact) developed in 30 African countries with World-Bank and WHO)

Asia: “Asia-Pacific Investment Case for MNCH” prepared by CBG, including JICA and launched at 2009 ADB Finance Ministers Meeting; “11 National Level Country Specific Strategic Analysis” and % “Sub-national Investment Cases in 5 Countries under development

Costing of health system strengthening to achieve health-related MDG’s in 49 LDC’s for “High Level Task Force on Innovative Financing of Health System Strategies” ( UNICEF- World Bank-UNFPA – PMNCH)

After several independent expert reviews sice 2007, the latest version of MBB is currently undergoing a final expert review for endorsement by all health related UN agencies , which we hope will be completed by mid September 09

A UN wide set of results based costing, planning and budgeting tools is under development integrating key elements of MBB and other costing tools to optimize synergy & harmonization and minimize the time involved and opportunity costs for very busy MOH staff.

Thank You

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The MBB toolkit

Overview.MBB application.MBB User manual.MBB Technical Notes.MBB Training Material.

Steps in MBB: Results-Based Planning, Costing & Budgeting

Step 1: Analyzing Equity, Health & otherSystems Design and epidemiology To prioritize and Package High Impact Interventions

Step 4: Estimating Marginal Cost of removing bottlenecks

Step 3: Estimating Impact on MDGs 1c,4,5,6,7

Step 2: Analyzing System Wide Supply & Demand Bottlenecks for equitable coverage and selecting strategiesto remove these

Step 5: Budgeting and analyzing Funding sources and Fiscal Space

Step 2: Coverage Bottlenecks: adapted from Tanahashi Model

Ava

ilab

ilit

y co

mm

odit

ies

Ava

ilab

ility

hu

man

res

ourc

es

Acc

ess

infr

astr

uct

ure

Init

ial u

tili

sati

on

Ad

equ

ate

Cov

erag

e

Eff

ecti

ve

cove

rage

Fu

nct

ion

al A

cces

s

Removing coverage bottlenecksin Ethiopia to scale up ITN

ITN indistricts

HEWs Families w ithnet

Using net Using treatednet

2005

2007

80% 80%

65%

72%75%

36%

20%

1%4%

16%

0%

25%

50%

75%

100%

2005 2007

procurrred >20,000 ITN

trained and deployed about 20,000 HEW policy

decision: long lasting ITN

Procured + distributed 20 million ITN’s

Trained & deployed 30.000 HEW

Step 3 + 4: Linking fund flow to impacts: Application of “Tanahashi Model”

∆C of individually

oriented non schedulable health & nutrition interventions

Impact on MDG

health indicator

s: Reductio

n in U5MR

and MMR

Availability

Commodities

∆C of

family/community level health & nutrition interventions

Access Infrastruc

ture

Utilization

Adequate Coverage

Effective Coverage

Essential drugs commodities, safe water system,.

inputs for a mobile team, construction of health post etc.

Drugs and supplies, subsidies for insurance for referral care per user etc.

Demand side subsidy, performance-based incentives for health workers, doctors, and IEC inputs etc.

Training, supervision and monitoring of community mobilizers, primary and

referral clinical care etc.

Examples of Inputs Coverage

Determinants

∆C of population

oriented schedulable health & nutrition interventions

Health Output

Cost of removing bottlenec

ks to achieve certain MDG targetAggregate cost of inputs

MDGs Outcome

Availability of HRPre-service training

Step 5: Fiscal Space ScenariosScenario 1: Optimistic: Scenario 2: Inter- Scenario 3: pessimistic

Additional fiscal space $ 91 billion $ 45 billion $ 6 billion

GDP, 2008 WEO, IMF April 2009 update WEO, IMF April 2009 update WEO, IMF April 2009 update

Annual GDP growth WEO, IMF April 2009 update WEO, IMF April 2009 update 1% less than that predicted in WEO, IMF April 2009 update

Health as % of Total Government Expenditure

Reaches 15% GGHE/GGE in 2015 for sub Saharan African (SSA) countries (2), and 12% for

Reaches 12% GGHE/GGE in 2015

Constant to GDP, except for 2009-2010,where there is a 10% decrease of the share to GDP

ODA target as % of GNI from OECD DAC(3); 50% of additional EU resources up to 2010 allocated to SSA

Increases by 50%

Doubling of Japan ODA to Africa by 2012 (4)

63B US$ from the USA by 2014 (5)50% of projected private funds, which were projected using elasticity to GDP

Increases by the projected rates of GDP growth with a 1.06% elasticity to GDP

(for every 1% GDP increase, private expenditure on health increases by 1.033%)

Fiscal Space Scenarios (all in 2005 constant US$)

Official Development Assistance for health (multilateral, bilateral and general budget support; does not include debt relief)

Constant to GDP, except for 2009-2010, where there is a 10% decrease of the share to GDP; then returns to 2008 ratios and kept constant starting from 2011 to 2015

Private expenditure for health

50% of constant proportion of private health expenditures to GDP

$151.0

$89.0

$48.0

$-

$20.0

$40.0

$60.0

$80.0

$100.0

$120.0

$140.0

$160.0

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

Comprehensive Medium Focussed

Billio

ns o

f US$

2009

-15

Progress towards MDGs, Marginal Cost, and Fiscal Space

MDG 1 MDG7MDG 6MDG 5MDG 4

baseline funding

intermediate

additional fiscal space

Optimistic additional

fiscal space

MDG 1.BMalnutrition

MDG 5:Reproductive Health

MDG 4Child Survival

MDG 6Communicable Diseases

MDG 7WASH

Step 5: Integrating Priority Health Programs in the Budgeting Process and MTEF

MBB Simulation

Tools

ImmunizationFinancial

Sustainability Plans

Malaria Program Costing

HIV/AIDSProgramCosting

MTEF

IMCI,Reproductive Health

Safe PregnanciesAnnual Budget

Step 5: Budgeting

26

Cost of scaling up health services in Ethiopia : incremental cost per capita 2005-2015 for reaching MDGs

Current Health Expenditures

Step 1

Step 2

Step 3

Step 4

Step 5

0

5

10

15

20

25

30

35

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

US$ (2004 constant $)

Step 5 : Expansion and Upgrade of Referral Care

Further decrease of : child mortality maternal mortality HIV MTC transmission Provision of HAART , multi-drug resistant TB and severe malaria treatment

Step 4: Expansion and Upgrade of Emergency Obstetrical care

Further decrease of : child mortality maternal mortality HIV MTC transmission

Step 3: First level clinical upgrade

Further decrease of: Child mortality Maternal Mortality Malaria, morbidity & mortality TB

Step 2: Health Services Extension Program

Decrease in child mortality Reduction in HIV Mother To Child Transmission Reduction of deaths due to pregnancy by 40% Reduce malaria mortality/ morbidity Reduce Child malnutrition

Step 1: Information and Social Mobilization for Behavior change

Decrease in child mortality due to HIV, malaria, diarrhea diseases Reduced HIV transmission Reduced malaria morbidity and mortality

Evolution of MBB for Results Based Planning, Costing and Budgeting at Global level Africa: “Strategic Framework for MDG 4 and Other Health-related MDG’s in Africa”

(WHO, UNICEF, Word Bank) on request of the African Union and “Results Based Health Sector Plans” (MTEF’s and IHP+ Compact) developed in 30 African countries with World-Bank and WHO)

Asia: “Asia-Pacific Investment Case for MNCH” prepared by CBG, including JICA and launched at 2009 ADB Finance Ministers Meeting; “11 National Level Country Specific Strategic Analysis” and % “Sub-national Investment Cases in 5 Countries under development

Costing of health system strengthening to achieve health-related MDG’s in 49 LDC’s for “High Level Task Force on Innovative Financing of Health System Strategies” ( UNICEF- World Bank-UNFPA – PMNCH)

After several independent expert reviews sice 2007, the latest version of MBB is currently undergoing a final expert review for endorsement by all health related UN agencies , which we hope will be completed by mid September 09

A UN wide set of results based costing, planning and budgeting tools is under development integrating key elements of MBB and other costing tools to optimize synergy & harmonization and minimize the time involved and opportunity costs for very busy MOH staff.

THANKS

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