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Chapter 18 - From Passive to Strategic Purchasing in Low and Middle Income Countries

The What and How of Getting the Most from Limited Resources

from Section 2 - Transforming Health Systems: Confronting Challenges, Seizing Opportunities

Published online by Cambridge University Press:  08 December 2022

By
John C. Langenbrunner ,
Cheryl Cashin ,
Michelle Wen  and
Mariam Zameer
Edited by
Sameen Siddiqi ,
Awad Mataria ,
Katherine D. Rouleau  and
Meesha Iqbal
Sameen Siddiqi
Affiliation:
Aga Khan University
Awad Mataria
Affiliation:
World Health Organization, Egypt
Katherine D. Rouleau
Affiliation:
University of Toronto
Meesha Iqbal
Affiliation:
UTHealth School of Public Health, Houston
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Summary

This chapter discusses the concept, design, implementation challenges and emerging models of successful strategic purchasing (SP) in low- and middle-income countries (L&MICs). The purchasing function is concerned with allocation and use of funds to ensure more value for the existing money by setting the right financial incentives to providers and ensuring that all individuals have access to needed health services. There is a marked difference across countries in terms of how they purchase health care. Passive purchasing implies following a predetermined budget or simply paying bills when presented. In contrast, SP involves a continuous search for the best ways to maximize health system performance by proactively answering questions such as – for whom to buy, what to buy, from whom to buy, how to pay and what impact. There are enablers and choke points for implementation of provider payment systems that need consideration. For L&MICs to do SP effectively, calls for building technical capacity in provider payment, greater policy coherence, institutional relationship between government and purchasers, and a step-by-step approach allowing countries to move towards SP.

Keywords

Strategic purchasingLine item budgetsOutput based allocationsProvider paymentCapitationDiagnosis related groupsBenefit packageContractingAccountabilityManagement and information systemsPay for performanceProvider autonomyQuality assuranceGovernance and financing of careL&MIC
Type
Chapter
Information
Making Health Systems Work in Low and Middle Income Countries
Textbook for Public Health Practitioners
 , pp. 277 - 293
Publisher: Cambridge University Press
Print publication year: 2022

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