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Mr. Peter S. Heller and Mr. William C. Hsiao

health outcome High spending, good protection for the insured. Protection for the low- income and poor depend on availability of public health services F, O, I, R denote financing, macro-organization, incentives, and regulations, respectively. L, M, and H denote low, medium, and high, respectively. 4. Guideposts for Macroeconomists Useful data —in assessing health system performance, three types of data should be sought: the National Health Account (NHA), compiled according to international standards; the latest statistics on infant

Ms. Evridiki Tsounta
Despite the increasing interest in universal health care, little is known about the optimal way to finance, design, and implement it. This paper attempts to fill this gap by providing some general policy recommendations on this important issue. While most of the paper addresses the Eastern Caribbean Currency Union (ECCU) countries, its policy implications are applicable to any country. The paper finds that the best financing option is country-specific depending on a country’s economic, cultural, institutional, demographic and epidemiological characteristics, as well as political economy considerations. However, taxation should be the primary financing source. It also concludes that an appropriate and realistic benefit package would need to be designed to ensure the system’s financial viability. Regarding the optimal way to implement universal health care, certain preconditions are needed, including sound public administration, a small informal economy, and a transparent health financing system that builds social consensus.
International Monetary Fund

as alcohol consumption); environmental factors (such as access to sanitation facilities and clean water); and contagious disease indicators (tuberculosis [TB] and HIV diffusion). If these factors are not incorporated in the analysis, then rankings based on the relationship between public health spending and outcomes alone can be misleading. Emerging and developing economies are very different from advanced ones in terms of health system performance. From 2001 to 2010, public spending on health averaged 3.2 percent of GDP in emerging and developing economies

International Monetary Fund. European Dept.

adequacy and sustainability of pensions. As concerns health care, Authorities take note of recommendations made by staff and remain firmly committed to continue working on tightening controls on spending. In this context, various internal control mechanisms and the monitoring of operational costs will be introduced. Work is also underway on the setting up of a Health System Performance Assessment Framework that links inputs with outputs and outcomes, to check for the efficient use of resources. Finally, Authorities are considering the establishment of a Development

Mr. Francesco Grigoli and Mr. Javier Kapsoli

negative impact. III. How Efficient is Health Spending in Emerging and Developing Economies? A. Stylized Facts Emerging and developing economies are very different from advanced ones in terms of health system performance, socioeconomic conditions, and quality of governance. 4 Table 1 presents the country group averages for some selected indicators over the decade 2001–10. Public spending on health averages 3.2 percent of GDP in emerging and developing economies, about half that of advanced economies. The differences are even more pronounced when measured

Victoria Fan and Amanda Glassman

and international policymakers approach issues of financing, fiscal transfers, and payment and provision policies. At a minimum, there should be greater attention to the ways subnational governments spend on health and how incentives for performance can cascade from central governments to states. The health promise of more local power can only be made real if policy is aligned at all levels for better health system performance. Victoria Fan is an Assistant Professor at the University of Hawaii at Manoa and a Research Fellow at the Center for Global Development

Maureen Lewis

combined with more concerted efforts on health system upgrading, preferably in concert with the options below, which allow the effective integration and application of new resources. Attack poor health system performance Health systems have been effectively overlooked in the drive to respond to the HIV/AIDS crisis, but it is the systems and their ability to function that determine whether services can be delivered, patients referred for treatment, and side effects treated. Civil service reform, budget management changes, and greater accountability for policies