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Department of Planning and Health Information

Annex 1
1.1 Population and health

Situation Analysis

Cambodia has a population of more than 14 million and a per capita GDP of US$409 (2005). Approximately 85% of the population live in rural areas and are engaged mainly in subsistence agriculture. Approximately 35% of the population lives below the poverty line. Economic growth has averaged 7% per annum in recent years, and the structure of the economy is changing. Commercial agriculture, fishing and forestry account for a third of national income, and strong growth has been evident in industrial sectors including the garment and footwear industries and in tourism. This industrial growth has led to an increase in the number of formal-salaried and informal-sector workers in urban areas. Wages remain low, however, and the income tax system remains under-developed. The anticipated commencement of oil production and other mining activities may expand formal employment opportunities. It is a hope that anticipated revenues from oil production may provide resources for investment in the social sectors including health care. The National Strategic Development Plan 2006-2010 (NSDP) sets the main priorities for Cambodian strategic development, while the Cambodian MDGs set the indicators and targets to achieve by 2015. The aims of the HSP 2003-2007 was to strengthen health service delivery, improve access to health services for the poor, improve attitudes of health providers, improve the quality of services, ensure a regular and adequate flow of funds to facilities, strengthen staff skills and capacities, improve the drug supply and expand health information. While key health indicators have improved in recent years major concerns remain and key health indicators are weaker in Cambodia than in many neighboring countries. As Figure 1 indicates, results from the CDHS 2005 show a considerable improvement in life expectancy and infant and under-5 mortality rates. The maternal mortality rate remains unacceptably high, and child mortality rates are still high compared to other countries in the region. As noted in the CDHS 2005, 37% of children under 5 are stunted and 36% of children are underweight.

NSDP 2006-2010 Priorities in health and connected sectors Poverty reduction Access to basic education Gender equality

CMDG’s target by 2015 Halve the number of people living below the poverty line All children complete nine year basic schooling, gender disparities in primary education eliminated Reduce gender disparities in secondary and tertiary education, eliminate gender disparities in wage distribution and public institutions Halve by 2015 proportion of people without access to safe drinking water and sanitation Halve under-five mortality rates, improve DPT3 and measles immunization rates Reduce maternal mortality to 1/3 of baseline rate, improve access to deliveries assisted by trained birth attendants Decrease the spread of HIV/AIDS, malaria, dengue fever and TB: Reduce HIV/AIDS prevalence, TB and malaria case fatality rates, improve malaria treatment at facility and TB detection rates

Access to safe drinking water

Reduction of maternal mortality Combat HIV/AIDS, malaria and other diseases

Strategic Framework for Health Financing


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On the supply side. In the past decade. new initiatives have been piloted in health service coverage and in contracting to non-government providers. 1. traditional and religious healers and birth attendants attract 20.8% of patients. a public health infrastructure has been provided across most of the country. or have been implemented locally in selected health districts. but have not achieved national coverage (with the exception of the HCP). The private health care sector is largely unregulated and of unknown quality. Cambodia has been the site for experimentation with a range of new and interesting initiatives in health systems development. In effect. a minimum drug supply to public facilities guaranteed through the Central Medical Store and health staff placed in most facilities. The low utilization of public health services has been a chronic problem.6% of reported episodes of illness are treated in the public sector. it is significant that demand-side initiatives to relieve the burden of OOP expenditures began with HEF (which is now available in almost half of all health districts) and CBHI (with Strategic Framework for Health Financing Page 2 of 15 . On the demand side. the inability to provide good quality and affordable public health services created a vacuum that has been filled in different ways by private service delivery. strengthening national programs aimed at the principal communicable and preventable diseases. The different levels of success of these schemes have been well documented in terms of improved service-delivery management. re-establishing functioning primary health services through a district-based health system. where the quality of service delivery remains poor. Most of the schemes have been local initiatives. with a variety of providers such as drug vendors. Key health indicators in Cambodia Only 21. Progress has been made towards the establishment of national health financing systems. often supported by NGOs. The non-medical sector. Despite many supply-side reforms. however. Now. In 1995 the Health Coverage Plan was adopted.Department of Planning and Health Information Figure 1. and raising the capacity of the health system overall to manage resources and perform basic functions efficiently. the demand for public health services has often not responded: access to services has been restricted by financial and other barriers and levels of utilization of public services have remained low. In terms of health financing. The quality of service delivery.2% of treatment episodes. low salary levels that in turn create an incentive for different forms of private practice and inadequate skill levels at most health centers and some hospitals. and in 1996 the Health Financing Charter authorized the collection of user fees at public facilities and helped to reduce the cost of services (by replacing more expensive under-the-table charges) and increasing utilization. remains low. under the HCP. it accounts for 48. The first truly national budget for health care was adopted in 1994 (until then health services were financed through allocations made to provincial governments).2 Achievements to date Indicator Life Expectancy (years) Female Male Infant mortality (per 100 live births) Under 5 Mortality (per 1000 live births) Maternal Mortality (per 1000 live births) CDHS 2000 57 50 95 124 437 CDHS 2005 65 60 66 83 472 Cambodia has made significant progress in the reconstruction of the health sector and the improved delivery of health services to the population in the last two decades. initiatives have been piloted in community co-financing. The constraints on the delivery of quality public health services include inadequate management capacity. By the mid-1990s Cambodia had already achieved much in developing national health policy and program priorities. health equity funding and community based health insurance. increased quality of service and increased access to services.

it is likely that a national coverage of social health insurance and social health protection will be difficult to organize and fund.10 per capita in 2000 to US$5. donor funding and household spending are the principal sources of financing for health care. and the 2007 budget targeted health spending equivalent to 12% of government recurrent spending and 1. 1. actual expenditure rose to 95% for the central health budget (including national hospitals. although it is not clear if this is own financed or donor on-budget financed expenditures. 1. these results have largely been achieved with the support of substantial donor input and technical assistance. In 2007. starting with government current and capital budget in priority social areas such as health and education sectors. constraints on government funding and the dependence on donor resources. Consequently. Disbursements tend to be low in the early months of the year. because of the weak taxation system. Page Strategic Framework for Health Financing 3 of 15 . US$19.1 National health budget The national health budget is increasing. As a proportion of budget.2% of GDP. However.70 per capita in the 2007 budget. and the back-loading of spending remains a significant problem. Budget disbursement has also improved. The budget mainly finances salaries and recurrent costs. including part of essential drugs and medical supplies. budget spending increased from US$2.3. 1 The low level of public resources reaching the primary health care service delivery level explains both the high level of out-of-pocket payments and the widespread prevalence of private providers. by Christopher Lane. national programs and national drug fund) and to 8090% for provincial budgets during 2005-06. 1 It is estimated that district hospitals and health centers receive about 18% of the gross health budget and 36% of resources when donor transfers are included. a large proportion of transfers to provincial health departments are still paid in-kind. The burden of social protection measures has therefore fallen on localized and independent schemes. particularly at the provincial level. will ensure higher standards of management and accountability of public resources for health. There is therefore an over-riding need for a national framework for health financing. While considerable improvements have been made in health indicators and access to services (including for the poor) in the past five years. These increases are broadly in line with NSDP objectives. April 2007. The proportion of public funding reaching the service delivery level is relatively low. and only about one third of the government health budget reaches the primary service delivery level according to 2004 estimates. The Public Financial Management Reform Program (PFM) which has been implementing by MEF. Following a sharp drop in 2004 the budget has since recovered. In nominal terms. making health services work effectively to meet MOH goals may require substantial increase in health expenditures on service delivery. A comprehensive discussion of health financing issues in the period to 2015 is contained in Scaling Up for Better Health in Cambodia: A Country Case Study for the Royal Government of Cambodia / World Health Organization / Post-High Level Forum on Health Millennium Development Goals.Department of Planning and Health Information more limited coverage) initiatives and only more recently have plans to implement SHI arrangements been developed.3 Health financing Government budget.5 million of the budget was allocated to the health Public Investment Plan for capital costs. As in most countries of similar socio-economic status. this fragmented approach is likely to be both ineffective and unsustainable. In the future. but the allocation of resources between these is not optimal.

000 15.605.130.472 87.966 21.604.000.663 25.68% 99.000.461 397.000.000.745 Page % 97.000.788 35.000 34.554.32% 91.863.650 6.62% Expenditure 224.733.200.497.000.564.000.941 73.668.000 7.00% 100.80% 80.100 % 84.411.122.090.52% 100.806.104.21% 96.877.676 6.510.000.198.000 240.600 4.77% Expenditure 185.060 5.12% 100.312 158.000 6.000 6.398.000 132.650 Mandate 230.00% 4.79% 85.389.946 % 93.398.000 Mandate 167.280.000 78.20% 91.85% 100.030 19.000.950.00% 100.33% 31.752.41% 100.000 350.792 23.000.00% 70.516.860.403. 80.950.872.437.46% Expenditure 157.507.668.05% 83.951 18.605.446.700 37.540 92.332.00% 99.000 71.890.324.000.70% 99.526.000 5.196.000 200.384.166 21.000 31.043.000 17.00% 88.283.000 21.900.60% Approved Budget 202.081.37% 85.34% 91.52% 84.228.57% 87.307.890.136.792 23.27% 100.919 109.390.065.388.098.554.000 23.000.94% 405.198.230.00% 100.397.00% 100.498.626.318.000 50.564.000 17.15% 97.46% 80.38% 100.206.76% 95.000 15.901.370.440.879.825.32% 81.398.941 73.307.06% 94.58% 32.000 70.398.000.20% 95.540 5.700 % 96.393 71.000 1.415.00% 92.038.000 15.030 27.000.748 103.939 401.960.733.18% 100.825.897.000.287 132.79% 63.498.604.000 15.000.817.000 108.93% 77.336 5.283.322.92% 72.00% 100.358.225 159.437.340 7.657 58.000.994.930.026 17.62% 7.02% 100.245.000 25.856.228.045.302.368.42% 80.288 7.009.26% 424.663 31.317.15% 81.672.098.564.62% 7.950.403.162.239 126.000 1.000.370.245.044.475.44% 99.437.420.859.330 19.745 % 94.397.785.188.610.00% 100.451 17.332.974.000.609 58.000 6.00% 100.237.05% 75.24% 76.855.807.800 20.194 100.565 38.747.13% 83.928.575.623 55.575.000 35.113.800 20.00% 100.471.182.730 19.000 25.194 34.254.951 18.000 103.769.901.970 25.990.964 4.48% 100.700 37.255 17.747.000.026 19.49% 87.000 73.461 397.516.323 58.090.638.00% 100.77% 17.000 35.458 36.58% 100.983 6.29% 14.24% 95.95% 81.016.000 24.Department of Planning and Health Information GOVERNMENT HEALTH EXPEDITURE YEAR 2003 Chapter GRAND TOTAL Sub Central 10 11 31 32 12 PAP13 Sub Province 10 11 31 Add13 PAP13 YEAR 2004 Chapter GRAND TOTAL Sub Central 10 11 31 32 12 PAP13 Sub Province 10 11 31 Add13 PAP13 Approved Budget 226.485.415 101.748 103.00% 100.448.000 Mandate 191.366.743 401.00% 100.000.671.448.000 37.57% 92.946 % 82.664 YEAR 2005 Chapter GRAND TOTAL Sub Central 10 11 31 32 12 PAP13 Sub Province 10 11 Approved Budget 240.00% 97.11% 83.060 5.03% 85.628.390.289.633.00% 100.368.272.000 23.472 88.565 Strategic Framework for Health Financing 4 of 15 .290.970 25.302.000 7.

52% 91.644 27.000.456.845 41.558.282 8.806.001 93.000.875.00% 100.00% 100.00% 100.000 100.563.988.317.108.912.000 105.842.426.00% 100.269.800 680.075.996.000.05% 97.965.840.000 7.000 26.000 9.001 93.00% 100.261.606.875.00% 105.00% 100.606.914.000.000.600.000 21.000 20.000 84.000 1.06% 83.29% 39.000 96.000 8.000 517.000.407 100.000.00% 106.948 8.514 39.000 50.48% 98.228.514 82.31% 116.631 8.00% 100.000 1.965.000 8.845 41.804.00% 99.133.90% Strategic Framework for Health Financing Page 5 of 15 .413.45% 97.813 48.000.747.00% 100.842.50% Approved Budget Mandate % Expenditure % Chapter Approved Budget GRAND TOTAL Sub Central 10 11 31 32 12 PAP13 Sub Province 10 11 31 Add13 261.000.727.422.065 28.000.75% 105.563 39.60% 91.96% 100.91% 100.578.000 186.222 5.735.Department of Planning and Health Information 31 Add13 PAP13 YEAR 2006 Chapter 1.000 31.000 176.791.000 100.356.043.800 802.222 7.00% 93.059.677.000.13% 99.013 179.317.805.840.413.000 7.378.948 8.56% 100.727.000.34% 91.803 69.000.839.000 5.897.000.457.805.000 8.000 256.07% 89.960.657.222 5.000.78% 97.14% 100.742.00% 63.803 69.45% 109.563.00% 84.35% 101.533.000.000 20.000.713.210.460.207.378.209.190 94.912.894.752.996.400 97.000 50.563 7.000 276.240.747.68% 117.00% 100.207 51.000.000 89.222 76.592 179.32% 96.989.000 71.57% 100.000.28% 517.793 44.82% 96.032.791.960.713.15% 88.391.

6% 83.862.953.410.146 95.7% 4.633.888 92.0% 11.338.229.081.000 96.000 148.983.Program Budget 218.1% 14.6% 39.9% 100.5% 3.000.451.788.0% Strategic Framework for Health Financing Page 6 of 15 .628.625 96.0% 4.223.000 59.822.318.000.527.8% 11.6% 341.295.6% 100.000 28.975.9% 98.0% 18.000.307.000 581.000 27.600.223.497.9% 58.7% 99.3% 96.344 79.0% 228.895.734.0% 39.060.0% 140.3% 92.3% 100.869.000.000.6% 99.3% 341.350.000 11.628.274.330.051 102.100 72.183.776 92.0% 94.478.861 89.0% 451.633.789.0% 27.136 97.3% 228.000 11.081.0% 5.729.0% 568.317.000.6% 15.275.473.453.4% 100.7% 99.000 38.660.276.430.400.468 94.000 3.017.8% 15.963 77.2% 8.953.3% 100.0% 26.130.527.405 94.107.000 2.307.688 83.000 4 5=4/3 6 7=6/3 349.311 97.275.0% 18.033 98.963 77.862.885 99.909.0% 100.815.1% 96.000 12.557.033 98.1% 100.0% 2.000 96.051 102.000 123.4% 147.152.8% 9.029 94.5% 247.000 96.7% 26.000 13.800.719 93.120 97.862.7% 99.165.7% 100.963.0% 3.693.0% 10.000 Requested mandate Mandated budget Cash disbursed Amount 14 Amount 8 % % 9=8/3 10=8/4 Amount 11 % % 12=11/3 13=11/6 % % 15=14/36=14/11 2 336.518.005.000 28.000.307.000.040.9% 4.9% 96.1% 98.6% 86.794 82.2% 11.040.345.177.4% 3.0% 95.189.9% 100.7% 58.1% 10.990 96.0% 93.888 91.612.000.000 236.6% 96.860.024 95.776 92.3% 58.303.518.476.000 255.240.842.130.048.786.223.100 72.000 21.4% 96.3% 10.786.1% 15.783 96.661 89.576.350.000 20.506.483.600.414 99.022 75.958.300 98.000 99.6% 99.7% 9.240.980.190.273.4% 451.000 16.8% 100.6% 99.7% 99.492 94.472 74.000 6.000 2.079.709.0% 58.493.167.120 97.113.6% 99.7% 2.656.000.4% 100.000 27.063 90.330.954.000 94.8% 7.794 82.2% 234.850.1% Sub Central srbu 60 61 62 63 64 65 srbu 60 61 62 65 238.000 99.881.660.556 83.4% 100.855 98.448.338.000 98.307.063 90.9% 11.8% 10.000.6% 89.430.9% 3.4% 100.961.400 97.344 79.733 94.2% 83.144 80.000 99.375.295.320.000 13.000.748.000 86.963.060.733 94.000 93.0% Program Budget 20.135.646.8% 100.024 95.3% 4.029 94.9% 451.7% 7.120 96.3% 98.105.558.4% 99.8% 347.000 262.973.327.0% 4.963 77.0% 100.0% 37.000 93.152.478.745.130.000 27.000 21.405 94.521.554.000.956.628.219.142.0% Sub Province 60 61 62 64 65 63 98.733 97.8% 18.6% 11.047.518.2% 83.834.9% 100.0% 11.4% 97.000.661 11.0% 96.953.0% 94.660.840.000 38.421.9% 100.4% 146.0% 94.746.000.000 15.375.000.141.635.5% 540.5% 96.2% 11.638.639.1% 11.338.492 94.926.9% 5.5% 97.231.776 92.5% 247.8% 247.721.0% 83.000.318.371.000.4% 5.033 98.483.191.478.330.021.557.294.051 98.6% 9.6% 10.1% 99.369.338.081.000.162 92.048.0% 2.000 91.274.709.718.909.0% 5.1% 253.000 96.000 11.954.000 91.468 94.476.167.000 11.000 16.4% 99.4% 5.9% 98.5% 100.958.000 99.660.775.000 96.181.5% 99.307.0% 9.660.610.338.063 90.0% 26.794 82.453.544 94.100.0% 97.223.9% 100.000 6.658. 7.9% 15.953.000 3.0% 7.721.000.338.103 92.345.715.Department of Planning and Health Information Government health budget Vs Expenditure 2007 Approved Charpter Budget by Assembly 1 Grand total Adjusted Requested for commitment Commit ed budget budget Amount % Amount % 3 361.317.166.630 93.060.860.633.403.405 94.564.1% 338.002.8% 3.105.4% 100.746.422 91.0% 11.8% 26.375.000.6% 7.289.860.472 91.850.9% 99.271 102.661 89.273.963.764 92.909.000 18.9% 99.0% None.6% 100.000 9.468 94.0% 2.000.7% 100.410.143.870 97.000 8.612.021.358 96.992.000 56.0% 140.4% 83.000 242.029 94.5% 98.8% 100.273.207 95.907.0% 100.0% 83.8% 18.888 91.676 85.219.0% 91.034.0% 140.7% 26.734.000 91.6% 58.786.000 581.344 79.100 72.3% 2.704.000 27.000 99.103 99.384.311 96.453.247.1% 228.

CRS database. There was a sharp increase in donor funds in 2002-04 from the US. mgmt Basic health infrastructure Basic nutrition Health personnel development Health education 0 10 20 30 40 50 Source: 2002 NSDP Source: OECD. equivalent to about $8 per capita compared to public current health spending of $4 per capita). according to the 2006 OECD harmonization and alignment baseline survey. management Basic health care Reproductive health care & family planning Medical services. There has so far been only limited alignment of donor programs with Cambodian institutions and procedures. Japan. Donor financing is not closely aligned with national priorities as set out in the HSP. Donor coordination. Strategic Framework for Health Financing Page 7 of 15 . Donor funding comes from a diverse range of multi-lateral and bi-lateral sources and a large number of international NGOs and is delivered mainly through a project approach. Better tracking and accountability. In recent years the financial level of donor funding for health has been increasing (partly due to the depreciating value of the US dollar). which identified at least nine different ‘project implementation units’ in the health sector. training and research Population policy and admin. UK and the Global Fund. but a number of donors have supported a program-based approach in health sector through SWiM and in the implementation of HIV/Aids assistance.Department of Planning and Health Information 1. harmonization and alignment are critical issues. By devolving budget control and management closer to service delivery public-sector reforms supporting deconcentration and public finance management reform will address transparency and accountability issues. NSDP: Priority Action Plan for Health 2003-05 (percent of total) Primary health care coverage Scale up equity funds Contracting in remote areas Health education (incl HIV aids) Public private partnership in basic health Communicable diseases HIV Aids Communicable diseases ( non-HIV aids) Staff incentives in remote areas Pilot health insurance 0 10 20 30 40 50 Donor disbursements for Health by Purpose 2003-05 (percent of total) STD control including HIV/AIDS Infectious disease control Health policy & admin. there was a further increase in 2005 particularly from the Global Fund. as envisaged in the second Platform of the PFM reform (200709) will in turn set the stage for channeling donor finance through the budget and addressing harmonization and alignment problems with donor finance.3.2 Donor funding Donor finance exceeds the government budget for health (a total of $114 million in 2005.

In 2006. out of the total household OOP expenditure on health care.7 0.5 18. a study by Catherine Michaud (for the Macroeconomics and Health initiative) estimated that little more than 40% of total health expenditure flowed into the public sector with almost 60% to private providers.1 4.2 3. borrowing and asset sales.Department of Planning and Health Information Estimated Donor Disbursements for Health.9 3.3 2.5 3.8 Donors Bilateral Australia Belgium Canada UK France Germany Japan Korea Netherlands Norway Switzerland US NGO 2003* 46.7 3.8 4. Official fees were set at a level considered affordable to most people.3 0.7 0. However. While the official user fees system also introduced a process of exemptions for the very poor.1 1.3 26.1 1. Much of the private spending on health care comes from higher-income groups while poorer households either rely on government services or are excluded from care because of cost.2 7.4 7.7 21 1.2 6.6 11. payments to government staff working privately and the direct purchase of medicines from pharmacies and drug sellers. the distribution of these gains was not uniform across income groups.3 1.7 12. 2003 and 2005 (US$ millions) Donors Multilateral UN UNFPA UNICEF WFP support to MCH WHO UNDP UNAIDS ADB WB EC Global Health Partnerships GAVI GFATM 2003* 2005** 25. OECD DAC Creditor Reporting System and GAVI and Global Fund websites 1.8 4.3 Household health spending It is estimated that 67% of total health spending in 2005 came from households in the form of OOP payments.9 Total 2003* 83.7 2.2 0 0 2. This occurred mainly because the costrecovery policy did not foresee that the absence of any mechanism to fund the exemptions would lead to a Strategic Framework for Health Financing Page 8 of 15 . To some extent.8 2.6 1.1 1.4 23 16. It was also estimated that.3.1 1.1 0.1 6.2 * Source Michaud (2005).8 5 3.1 1.6 2005** 65. and the introduction of official fees effectively lowered the costs of access to health services and increased utilization at most government health centers and some referral hospitals.6 3. in practice the proportion of patients receiving exemptions remained very low. Out-of-pocket payments are made as user fees to public and private providers.9 15.6 1. The introduction of official user fees at public facilities in 1996 was an attempt to regulate unofficial charges in a situation where under-the-table payments were common and expensive and to provide additional revenue to facilities to supplement low government salaries.4 1 6 1 1.6 0. But expenditure figures must be disaggregated against income levels to reveal a truer picture. ** Source: Cambodia Center for Development Cooperation.2 2.2 27.5 2005** 114. about 30% went to public health services and about 70% to private providers.9 1. this dependence on private services reflects distrust in the public health system. Approximately three-quarters of this OOP health expenditure is financed by cash in hand and savings and one-quarter by gifts.

the under-five mortality rate for the bottom two wealth quintiles is three times the rate for the highest quintile. making the poor particularly vulnerable to the expenses incurred during ill health. Platform 1 is being currently implemented with the following activities: • • • • • • • • • Improve comprehensiveness of and integration of budget formulation and execution Improve realism and sustainability of budget Streamline ability of budget holders to spend in line with budget Avoid re-accumulation of payment arrears Improve process for post-budget supplementary expenditure credit approval Develop revised procurement procedures Capacity development measures Motivational measures within MEF and line ministries Integration of functions within MEF 1. Private spending on health care exhibits very limited risk pooling. The policy prescribes that public administration has to (i) Ensure accessibility to services. (iv) Be transparent and accountable. Page Strategic Framework for Health Financing 9 of 15 .2 Policy on Public Service Delivery The Policy on Public Service Delivery applies to services of social affairs that include health and sanitation. The effects of OOP on impoverishment of households are demonstrated in several studies on debt for health and landlessness 2 . Consequently. Similarly.4 Institutional framework 1. particularly catastrophic health expenditures.000 live births) has already been achieved by the richest quintile while the remainder of the population remain far away from it. A case study among urban poor population (Center for Advanced Studies 2006 ) analyze indebtness as a result of health care costs. In fact. (ii) effective financial accountability. (iii) Provide services where needed.1 Public Financial Management Reform Program The Public Financial Management Reform Program (PFM) implemented by MEF aims “to install much higher standards of management and accountability in the mobilization of all government current and capital resources and effectiveness and efficiency in the use of resources in their application […]”. The PFM reform is sequenced in 4 platforms: (i) A more credible budget. 1. user fees remained a major barrier for the poor. For example.Department of Planning and Health Information situation in which few exemptions were actually granted. efficiency and effectiveness of services. the Cambodian MDG for U5M (65 deaths per 1. particularly for the poor. (iv) Managers fully accountable for program performance. A consequence of high OOP expenditures and limited riskpooling is considerable inequality in health outcomes by income level. (ii) Focus on the real needs of consumers.4. A survey among garment factory workers (GRET 2007) also shows health care as a cause of debt. Consequently. (iii) Affordable and prioritized policy agenda. community-based health insurance emerged at the same time as a pre-payment mechanism designed to protect the not so poor from impoverishment due to health costs. (v) Ensure quality. there is a crucial need for social health protection measures. 2 An Oxfam study in 2000 showed that 60% of households who sold productive land did so to cover for health care costs. Health equity funding emerged in 2000 in response to this situation as a means to fund fee exemptions at public facilities for the identified poor.4.

Regulations provide that user fees will be implemented in consultation with the community and local authorities by taking into account consumer needs and affordability. User fees are implemented and administered by the health facilities themselves following approval by the MOH. 22 CPA1. most public health facilities remain underutilized by a public that often prefers the formal and informal private sector where quality of services is perceived as being higher than in public facilities. Among other forms of contracting of services used in Cambodia are performance-based contracts used by bilateral and multilateral donors and other donors with various health units (such as a Provincial Health Department or OD Office).4. 6 Natinoal Hospitals and 3 Health Institutes are officially implementing user fee. User fees remain a minor proportion of facility revenues but play a significant role in financing additional incentives for staff and non-salary operational costs of health facilities. CPA2 and CPA3) while HCs are mandated to provide MPA service. 39% for operating costs and 1% paid as tax to the treasury. supplies and equipment costs. Contracting has strengthened facility management in these districts and helped to increase facility utilization. Referral hospital are classified into three categories in providing CPA services (CPA1. In 2004.4 Health Financing Charter Since 1996 the HFC has authorized the collection of user fees for services provided through public health facilities. there are 76 ODs.5 Contracting The contracting of public health service delivery to non-government providers (generally international NGOs) began with pilot schemes in 1999. However. in line with the strategic framework on decentralization and deconcentration reform adopted in 2005. 3 In fact the quality of private health providers has never been assessed and is not monitored. income from user fees at facilities has been allocated 60% to the facility for staff incentives. 3 1.4. user fees accounted for 13% of HC and 22% RH operational expenses. user fees will finance up to US$5 million out of planned MOH recurrent spending (including loan funds and NGO contributions) of US$80 million. 1. and deconcentration and decentralization of public services. The situation is aggravated by health workers dual public and private practice. Until now there are 77 ODs. and allowances to staff. drug. 69 Referral Hospitals and 966 HCs across Cambodia. 793 HCs.4. Page Strategic Framework for Health Financing 10 of 15 . but fee-exemption schemes at health facilities have not worked adequately to protect the poor or provide sufficient access to services. mainly because these fee-exemptions have not been funded. According to the AOP 2007.3 Health Coverage Plan According to the 1996 HCP. Health seeking behavior is determined by a lack of trust in public facilities and perceived higher quality of private providers. Contracting contributes to better staff remuneration and incentives and works to improve access to services and key service delivery indicators (like immunization levels). Contracting is not strictly a form of health financing but aims at better management of services. Contracting arrangements have recently been reviewed under the HSP Review process. 32 CPA2 and 18 CPA3 and 877 MPA HCs are functioning and also 95 Health Posts have been established to provide basic health care in remote areas. and once a user-fee scheme is approved and put into operation all other forms of user fees previously implemented shall be stopped. Until now there are 67 Referral Hospitals. Following a 2005 the MOH and the MOEF’s Inter-Ministerial Prakas.Department of Planning and Health Information Implementation mechanisms for the policy rely on One-Window Office. An Inter-Ministerial Prakas in 2006 allows government funds to be used within the framework of MOH credit budgets for paying user fees on behalf of poor patients. Contracting is commonly associated with user fees for service and often with health equity funding schemes. In 2004 the MOH introduced a second phase of Contracting in 11 ODs under the Health Sector Support Project (HSSP). 1. in particular ‘under-the table payment’.

reduced the impact of health costs on impoverishment. 2004 January 1. 2007 HSSP/ADB/DFID $2.00 October 1. and provided a needed subsidy to facilities.400.20 April 1. 2004 May 1.00 $208.392. the MOH adopted the National Equity Fund Implementation and Monitoring Framework to coordinate the work of the various independent HEFs. Poor patients receive free or discounted care at public facilities.600. increase the proportion of health Strategic Framework for Health Financing Page 11 of 15 .468. 2004 December 31.506. The JAPR 2006 proposed that the number of HEF schemes be increased from 16 to 35 in non-Contracting ODs and continue in all 11 Contracting ODs through the HSSP (reaching a total of 46 out of all 77 ODs).263.785.4. 2004 December 31. HEFs are decentralized schemes commonly based in a single OD.70 $302. 2004 December 31. roughly the same level as the proportion living below the poverty line on average. Currently.500.00 $2.00 $82. with guidelines for pre-identification of beneficiaries and a common schedule of benefits.10 $325.00 $215.6 HEF national framework Health Equity Funds are an informal social-transfer mechanism designed to subsidize health facilities for the costs of user-fee exemptions provided to the poor. 2007 HSSP/WB/DFID $1.780. successfully targeted the poor.658. It proposed to increase HEF coverage of the poor. In 2005. 2005 December 31. AusAID and RMIT University) found that HEF significantly increased utilization of facilities.573.Department of Planning and Health Information Recent positions of the MOH indicate phasing out of contracting in its current form and shifting to internal contracting. 2007 HSSP/ADB/DFID December 31.958. The Framework was supplemented with an HEF reporting and monitoring system developed in 2007 by the Bureau of Health Economics and Financing of the DPHI.90 April 1.848.239. The Implementation and Monitoring Framework offers a partnership with donors and NGOs to establish a uniform monitoring and reporting process. Contracting ODs by Provinces No Province 1 Kampong Cham OD Memut OD Ponhea Krek-Dambe 2 Prey Veng OD Pearaing OD Preah Sdach 3 Mondulkiri OD Sen Monorom 4 Takeo OD Kirivong OD Ang Rokar 5 Rattanakiri OD Banlong 6 Koh Kong OD Smach Meanchey OD Sre Ambel Sub Total 7 Preah Vihear OD Thbeng Meanchey Grand Total Effective date contract National Budget End date contract Source of fund HSSP/ADB/DFID Contract amount $2.00 April 1. Pagodas or Hospital-based committees). Since their beginning in Cambodia in 2000.757. reduced debt and interest payments for health care. While conditions vary widely between ODs. and it reimburses poor patients for the costs of transport and food during hospitalization. provided access for the poor who previously could not attend due to cost.543. The MOH regards HEF as a primary initiative to help the poor population with access to quality public health services.061.40 $204. 2007 HSSP/ADB/DFID $1.00 $120.048. The 2006 Study of Financial Access to Health Services for the Poor in Cambodia Phase 1 (for the Ministry of Health.850.60 $401.00 extimate per year April 1.00 $ 2007 HSSP/ADB/DFID December 31.299. 2007 $10. 2005 December 31. HEFs on average fund exemptions for approximately a third of referral-hospital patients where a scheme is available.80 $157.539.262.60 $2.00 $208. The MOH intends to accept greater responsibility for the funding. WHO.360. The poor are identified according to eligibility criteria and the HEF reimburses the public health care providers for the cost of services provided.20 $2.00 $346.569.337.00 1. 2007 HSSP/ADB/DFID $947. the number of HEF schemes has grown rapidly to cover now almost half of all health ODs. implementation and management of HEF schemes.995. they are donor-funded and mostly implemented through international and local NGOs (in a few cases the HEF is implemented through local community organizations.551 $11.

08 7/2002 7/2002 7/2003 12/2004 2/2005 9/2000 4/2006 7/2006 1/2005 7/2002 4/2005 1/2005 5/2003 5/2005 6/2007 6/2007 6/2007 11/2006 6/2007 6/2007 6/2007 6/2007 6/2007 6/2007 Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes No Yes Yes No No Yes Yes Yes Yes No No No Yes Yes Yes No No Yes No Yes Yes Yes Yes Yes Yes No No No Yes No No No No No No No No No Yes Yes Yes No Yes No No No No Yes No No No No No No Yes No Districts supported by MOH Kampong Chhnang Kampong Chhnang Kampong Speu Kampot Kampot Kandal Kandal Prey Veng Svay Rieng Takeo Pailin Kampong Speu Angkor Chey Kampong Trach Ksach Kandal Takhmao Kampong Trabek Romeas Hek Daun Keo Pailin Strategic Framework for Health Financing 12 of 15 . 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 Province Health Operational District Facility Donor INGO LNGO HEF began At RH IPD y/n OPD y/n At HC HEF schemes supported by NGOs Banteay Meanchey Mongkul Borei Banteay Meanchey Battambang Battambang Kampong Cham Kampong Cham Kampong Cham Kampong Cham Kampong Thom Kratie Kratie Mondulkiri Odar Meanchey Phnom Penh Preah Vihear Prey Veng Prey Veng Pursat Rattanakiri Siem Reap Siem Reap Siem Reap Sihanoukville Stung Treng Svay Rieng Takeo Takeo Takeo Takeo Thmar Pouk Mung Russei Sampov Luon Chamkar Leu-S. 2) post-identification mechanism in place in many ODs is not very effective in informing the population about their entitlements and 3) a large proportion of the population still prefers private health services not covered by HEF.Department of Planning and Health Information facilities offering HEF and improve HEF information systems. Siem Prey Chhour-Kong Meas Kampong Thom Chhlong Kratie Sen Monorom Samrong/Anlong Veng Municipality (4 ODs) Thbeng Meanchey Peareang Preah Sdach Sampeov Meas Rattanakiri-Banlong Siem Reap PH Sotnikum Kralanh Sihanouk Stung Treng Svay Rieng PH Ang Roka Kirivong Kirivong Takeo PH (Daun Keo) Provincial Hospital Referral Hospital Referral Hospital Referral Hospital Referral Hospital Referral Hospital Provincial Hospital Referral Hospital Referral Hospital Referral Hospital Referral Hospital Provincial Hospital PH and HC Municipal RH Referral Hospital Referral Hospital Referral Hospital Provincial Hospital Provincial Hospital Provincial Hospital RH and HC RH Referral Hospital Provincial Hospital Provincial Hospital Referral Hospital Referral Hospital Health Centers Provincial Hospital USAID CIDA USAID USAID BTC BTC BTC BTC HSSP USAID USAID HSSP BTC USAID HSSP HSSP HSSP USAID HSSP BTC BTC BTC USAID VSO UNICEF EU EU CIDA SRC RGOC RGOC RGOC RGOC RGOC RGOC RGOC RGOC RGOC RGOC URC MSF/HNI URC URC BTC BTC BTC BTC GTZ URC URC HNI BTC URC HU HNI HNI URC HNI BTC BTC BTC URC VSO UNICEF SRC/HNI SRC/HNI EED/SRC SRC MOH MOH MOH MOH MOH MOH MOH MOH MOH MOH CFDS CAAFW AFH AFH AHRDHE AFH AFH AFH AFH AFH AFH CFDS CHHRA USG AFH AFH/RHAC CFDS AFH CHHRA CFDS/CHHRA CHHRA RHAC Hospital EFS Cttee AFH BFH Pagodas CFDS ODO ODO ODO ODO ODO ODO ODO ODO ODO ODO Page 6/2003 5/2000 7/2004 8/2006 12/2005 11/2005 9/2005 1/2006 10/2005 6/2004 8/2006 10/2002 1/2005 8/2000 2006. Cham-K.Treng Cheung Prey-Batheay K. Expansion of HEF coverage was endorsed by the 2006 HSSP Mid-Term Review The actual impact of HEF on overall out of pocket spending may however be limited for the following reasons: 1) many HEF cover only referral hospital care. Health Equity Fund Schemes by Operational District # of OD and Hosp.

CBHI is a private. The Guidelines provide for a common approach to the administrative and technical requirements. the MOH produced guidelines for CBHI implementers. with a total of approximately 30. All companies and NGOs who want to implement CBHI must register with MOEF by submitting a financial plan they have obtained a Certificate of Recognition for the CBHI scheme from the MOH. The JAPR 2006 proposes to expand the number of CBHI schemes and to increase the membership of existing schemes.7 CBHI guidelines A number of community-based health insurance schemes have been introduced in various parts of the country by a range of international and local NGOs. All the schemes are supported by external premium subsidies or funding for administration provided by the sponsoring NGOs and other donors. voluntary insurance mechanism based on the sale of low-cost insurance premiums that provide the purchaser and their family with coverage for health charges for a stated list of medical benefits delivered at contracted public health facilities (generally health centers and referral hospitals). Strategic Framework for Health Financing Page 13 of 15 . CBHI coverage is currently offered through six schemes by five international and local NGOs working in seven ODs nationally.000 beneficiaries. The CBHI scheme pays the contracted facility for the cost of services delivered to its members. and portability between different CBHI schemes.Department of Planning and Health Information 40 41 42 43 44 45 National hospitals supported by MOH National Hospital Ang Doung National Hospital National Hospital National Hospital National Hospital National Hospital MCH Calmette Preah Kossamak National Paediatric Kampuchea-Soviet RGOC RGOC RGOC RGOC RGOC RGOC MOH MOH MOH MOH MOH MOH Hospital Hospital Hospital Hospital Hospital Hospital 2007 2007 2007 2007 2007 2007 1. basic benefit package. CBHI is based on the principle of risk pooling and pre-payment for health care.4. nonprofit. Following the formulation and launch of the Social Health Insurance Master Plan in 2005 (see next section). The MOH has adopted Guidelines for Implementing CBHI prepared by the DPHI in 2006. Formal regulations for CBHI implementation are to be introduced through the Draft Sub-Decree on Micro Insurance prepared by the MOEF.

funded by the ADB. WB and DFID SKY Soka Pheap Kruosa Yeung BTC Belgian Technical Cooperation GTZ HNI URC SRC UNICEF VSO HU German Technical Cooperation Health Net International University Research Company Swiss Red Cross United Nation Volunteer Services Overseas Health Unlimited Source: Based on MOH. following the establishment of the National Social Security Fund. The MOLVT is responsible for the development of compulsory social security and health insurance for private-sector salaried workers under the Social Security Law of 2002 (which authorized the establishment of the Social Security Organization). MOEF and the Council of Ministers. RMIT University (Melbourne). WHO. AusAID.257 CBHI 5. 1. MOSVY. The Master Plan covers compulsory social health insurance through the social security framework for public and private sector salaried workers and their dependents.335 CBHI 1.621 290.835 25.806 Source Implementers CAAFW GRET/SKY GRET/SKY GRET/SKY RACHA GRET/SKY BFH GRET/SKY CHHRA Health Facility Types 1 RH & 8HCs RH HC Rolous RH 1RH and 1 HC 2 RHs & 9HCs 2 RH and 8HCs RH &HC 2 HCs Benefit OPD & IPD IPD OPD IPD OPD & IPD OPD & IPD OPD & IPD OPD & IPD OPD Payment Mechnism Case based payment Capitation Capitation Capitation Capitation Capitation Capitation Capitation Case based payment 1 Banteay MeanCheay 2 Kampong Thom 3 Kandal 4 Phnom Penh 5 Pursat 6 Takeo 7 Takeo 8 Takeo 9 Ordor Mean Cheay Total Feb-05 2007 GTZ/GRET 1998 2005 Aug-06 2001 AFD/GRET Apr-06 SRC/GRET 2003 Aug-05 Abbreviations: Con Contracting HEF Health Equity Fund CBHI Community Based Health Insurance CAAFW Cambodian Association for Assistance to Families and Widows CFDS CHHRA CIDA EFS EU GRET Cambodian Family Development Services Cambodian Health and Human Rights Alliance Canadian International Development Agency Equity Fund Steering committee European Union Groupe de Recherche et d'Echanges Technologiques HSSP Health Sector Support Project. Annear et al. Phnom Penh: MOH.417 CBHI 1. Design and Data Analysis. MOSVY is also looking into development of a sub-decree on medical benefits to provide a legal basis for a pilot scheme in social health insurance for Ministry employees in Phnom Penh.8 SHI Master plan In 2005.443 153.Department of Planning and Health Information Operational District with Community Based Health Insurance (CBHI) PHD_C ode PHD_Name OD_Name Thma Puok Kampong Thom Koh Thom Municiplity Sampov Meas Ang Rokar Kirivong Kirivong Samraong OD Pupulation Type Starting population Covered 130. including the provision of a work injury program and old age pensions.4.694 296. voluntary insurance through the development of CBHI schemes sponsored by different development partners.5 Lessons learned and challenges From the situation analysis a number of lessons can be drawn: Strategic Framework for Health Financing Page 14 of 15 . occupational injury and other benefits including maternity and sick leave. The MOSVY is responsible for the development of social security for civil servants and is developing a sub-decree on the provision of pensions.466 221. the MOH adopted the Master Plan for Development of Social Health Insurance and an interministerial Social Health Insurance Committee was established between the MOH. Bureau of Health Economics.792 129.386 CBHI 39. Study of Financial Access to Health Services for the Poor in Cambodia – Phase 1: Scope. 1. health care will be added in the next phase (after 2009). 2006.774 CBHI 1.166 CBHI 1. MOP. MOLVT.942 102.341 CBHI 565 CBHI 565 CBHI 2. local NGOs and health care providers for the informal employment sector and social assistance schemes including health equity funds and other funds proposed by government for the poor.

• Because service quality is poor only one in five illness episodes are treated in the public sector. strengthening government taxation and revenue collection is essential. Strategic Framework for Health Financing Page 15 of 15 . • The provision of health care mainly through the private sector funded through private out-ofpocket payments by households will continue until 2015 even though the quality of care obtained through private providers is generally low. While it is substantial. The dependence on OOP spending for health care means that the implementation of social health protection measures is crucial.Department of Planning and Health Information • While the health status of the population is improving key health indicators are weaker than in neighboring countries. • The relatively low proportion of public funding reaching the service delivery level largely explains the high level of out-of-pocket payments which in turn leads to considerable inequality in access to services and health outcomes. • Different health financing schemes are in place but they are not consistent and not integrated into a single plan. external aid for health is highly fragmented and not closely aligned with national health priorities. harmonization and alignment are crucial. Strengthening the efficient allocation of appropriate levels of resources to the service delivery level is a priority. There is a need to move aggregate resources from inefficient and ineffective private providers to an efficient public health system. • Important issues relating to the economic allocation of existing resources and their efficient use remain unresolved. HEF. • Because per capita total national health expenditure is very high compared to all other developing countries the total quantity of health financing does not appear to be the central impediment to achieving improved health outcomes. Better donor-government coordination. • While government funding for health care is a significant proportion of the national budget the health budget remains low in absolute terms. Strengthening Contracting. CBHI and integrating them in a coherent plan are an immediate need.