Objetivos específicos

The National Health Accounts (NHA), an accounting platform that describes both public and private expenditure flows within the health sector, is the single most important source of information for the health care financing component of this case study.

In Ethiopia, the NHA survey has been conducted intermittently since 1995/96 with slight changes in the methodology and overall content (like including sub-accounts for specific diseases and maternal and child death) over the years. There were also efforts to improve the methodology, making use of an NGO survey for verification of data in addition to the use of audit reports from Disaster Prevention and Preparedness Commission (DPPC) and

CRDA so as to minimize the under-estimation of expenditures (41). According to Berman (1996), the core concept of the NHA is to track the flow of funds from one health care actor to another, including public, private, and donor expenditures for planning and managing the national health system and providing a basis for informed decision-making. The NHA is a tool to assess resources allocated and utilized thereby providing the best framework for modeling reform strategies and for monitoring their effects (42).

Overall the findings revealed that the NHA estimates of total health expenditures increased seven-fold in the time interval from 1995/96 to 2010/11 (Figure 7).This change is attributable to the introduction of strategies such as rapid increase of the overall health worker cadre and expands the scope of primary care services through the HEP. A pivotal change in the total health expenditure was observed from 2004/2005 onwards, which marked a turning point in the increasing resources for health resulting in the overall improvement of health service delivery. Between 1995/96 and 2004/05, Ethiopia's total health expenditure increased by more than two fold, while the increase in total health expenditure was twice as much between 2004/05 and 2010/11.Figure 6. Total health expenditure over time

The incremental trend in total health expenditure over time was mainly attributable to the introduction of new health strategies and a more harmonized system of resource mobilization from all sources to support health service delivery. More rapid increase in the total health expenditure occurred since 2005 mainly due to the introduction of FMOH’s flagship HEP, IMNCI, and other health service expansion activities. Furthermore, Ethiopia was able to mobilize more external resources for health by various advocacy mechanisms

200 400 600 800 1,000 1,200 1,400 1,600 1,800

1995/1996 1999/2000 2004/2005 2007/2008 2010/2011

USD (millions)

Figure 7. Total health expenditure over time

and demonstrating efficiency in resource allocation and utilization through its harmonization initiative.

Total Health Expenditure as a Percentage of GDP

Total health expenditure as a percent of GDP increased even with rapid economic growth.

According to the MOFED national accounts, from 1999/00 to 2010/11 Ethiopia experienced an average annual real GDP growth rate of 9%. Although total health expenditure as a percent of GDP increased over time from 3.8% in 1995/96 to 5.2% in 2010/11(Figure 8), it is still below the average for low-income countries (6.43%)(43).age of GDP over time

Figure 7. Trends showing of total health expenditure as a per

Total Health Expenditure Per Capita

The per capita health expenditure also showed an increasing trend over the years from 4.09 United States dollars (USD) in 1995/96 to 20.77 USD in 2010/11. Even accounting for population growth, there was a greater increase in per capita expenditure from 2004/05 to 2010/11 (an increase of nearly two-fold) compared to 1995/96 to 2004/05 (only a 75%

increase). Despite this rapid increase in per capita health expenditure, it is still below the recommended amount by the WHO’s Commission on Macroeconomics and Health of 34 USD (Figure 9). This recommendation is considered the minimum amount of per capita health expenditure required in developing countries for providing essential health interventions to achieve health related MDG targets and provide basic health care services to the population(44).

3.8%

4.0%

5.0%

4.5%

5.2%

2.0%

4.0%

6.0%

1995/1996 1999/2000 2004/2005 2007/2008 2010/2011

Percent (%)

Figure 8. Trends showing of total health expenditure as a percentage of GDP over time

Figure 8. Trends showing expenditure per capita (USD) over time

Total Health Expenditure by Funding Source

The rapid increase in total health expenditure in absolute terms from 2004/05 onwards, did not necessarily coincide with a rapid increase in health expenditure for each financing source. As depicted in (Figure 8), during 2005-2011 external resources, referred to as rest of world (ROW) in the NHAs, and household showed a significant increase in health expenditure while private/local NGOs remained stagnant and the government contribution followed an almost similar pattern (Figure 10). Based on this, ROW and household have become the main contributors for health after 2004/05.

4.09 5.60

7.14

16.09

20.77

0.00 5.00 10.00 15.00 20.00 25.00

1995/1996 1999/2000 2004/2005 2007/2008 2010/2011

USD

Figure 9. Trends showing expenditure per capita (USD) over time

gure9. Total health expenditure by source

The percent share of household contribution to the total health expenditure declined from 52.66% in 1995/96 to 33.7% in 2010/2011 (Figure 11). This may be related to the rapid increase in expenditures from the ROW as a result of the “one plan, one budget and one report” modality to support the HSDP's and enhance the progress towards the MDG targets.

Furthermore, the implementation of the Health Care Financing strategy after 1998 may have slowed the increase in household Out Of Pocket (OOP) health expenditure given its emphasis on the fee waiver scheme, subsidized user fees, and facilities to provide certain fee-exempted health services for everyone. The WHO recommended that ‘when the direct payment falls between 15% to 20% of the total health expenditure the incidence of financial catastrophe and impoverishment falls to a negligible level’(45). Ethiopia has still not reached those levels despite the considerable decrease in household contributions as a share of total health expenditure.

200 400 600 800 1,000

Government Rest of World Household Local NGOs and other private funds

USD (millions)

Figure 10. Total health expenditure by source

1995/1996 1999/2000 2004/2005 2007/2008 2010/2011

Figure 10. Total health expenditure contribution by source

As illustrated in (Figure 11), the government’s contribution to health has declined as a percent share of total health expenditure. However, the government's expenditure on health as a proportion of national expenditure has increased from 8.5% in 2000 to 13.4%

in 2010. Ethiopia has still not met the ‘Abuja Declaration' (2001) target requiring African government to allocate at least 15% of their total spending for health (55). In contrast to the government’s health policy directives to focus on primary health care services, more than 43% of health expenditure was spent on drugs and 22% was allocated to hospitals (46). The out-of-pocket burden for drugs was particularly high (75.8%).