In this blogpost, Inke Mathauer (WHO Geneva) introduces the concept of strategic purchasing which will be the topic of a forthcoming 1-day workshop taking place in Rabat on September 30th. This event is co-organized by the Communities of Practice Performance Based Financing and Financial Access to Health Services and the World Health Organization.
What is strategic purchasing?*
As one of the generic sub-functions of health financing, purchasing refers to the allocation of resources to health service providers; it occurs in all health systems in all countries. There is a growing consensus, demonstrated by country reform activities, to move away from a passive approach of purchasing (no selection of providers, no performance monitoring, no effort to influence prices, quantity, or quality of care) to an active or strategic approach. As such, strategic purchasing involves linking the transfer of funds to providers, at least in part, to information on aspects of their performance or the health needs of the population they serve. It is relevant for all types of health financing systems, not just separate purchasing agencies such as (social) health insurance.
Yet, strategic purchasing is not all or nothing. There is a continuum from passive to strategic purchasing. Moving towards strategic purchasing can take many forms, but at minimum it means moving away from one of two extremes, either (a) historic input-based, rigid line item budgets, which are weakly linked to provider activity, productivity or results; or (b) completely unmanaged fee-for-service involving simple reimbursement of whatever bills are submitted by providers.
Why does strategic purchasing matter for UHC?
The aims of strategic purchasing, broadly, are to guide allocation of resources, to manage expenditure growth and to promote quality in service delivery in order to generate “more health for the money”, i.e. to increase efficiency. Other important UHC related goals that are influenced by (strategic) purchasing include equitable distribution of resources as well as improved accountability of providers and accountability of purchasers to the population. Efforts to shift towards more strategic purchasing are at the core of health financing reform, with strong purchasing mechanisms a potential driver of system change on the path towards UHC.
How to get there?
Some countries have made significant progress in moving towards strategic purchasing, others struggle for example with incomplete reforms, opposite group interests and lack of leadership. Technical capacity in designing reforms as well as better understanding of potential windows of opportunities are critical.
Renewed attention in country health financing dialogues as well as in research on key areas around strategic purchasing such as governance, information management systems, mixed payment systems and benefit package design will be important to gather evidence and lessons on what works and how.
The Rabat workshop
In the Health Financing Unit at WHO, we are planning to expand the work on strategic purchasing to contribute to a collaborative agenda on ‘strategic purchasing for UHC’.To inform this agenda, your input is appreciated. We would like to organise a knowledge exchange and learn from your experiences and analyses of those of you active in this field, as fund holders, purchasers, researchers or technical assistants.
As a first step, WHO and COPs propose to engage with experts who will be present at the AfHEA conference in Rabat (27-29 September). On Friday the 30th (after the conference), we will jointly organize a one day workshop. After a quick introduction to the concept of strategic purchasing, we will work together on the identification of challenges (e.g. capacity strengthening needs) and priorities at country level and thus sharpen a global learning agenda.
If you plan to be in Rabat that week and are interested in this activity, please register here. We will limit the participation to maximum 25 experts. Participants are expected to cover their own costs. Lunch and coffee breaks will be provided.
We hope to see you in Rabat.
* This blog is based on the WHO Health Financing Unit concept note on strategic purchasing.