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Paying for primary health care: mechanisms for recurrent financing.

Golladay FL; Liese B
In: Wood C, Rue Y, ed. Health policies in developing countries. London, England, The Royal Society of Medicine, 1980. 35-9. (Royal Society of Medicine. International Congress adn Symposium Series; No. 24)

Improving access to essential health care is a goal of most developing countries and donors of economic assistance. Many unsuccessful attempts have been made to help the poor through fostering a growth in production and redirecting development activities. Recently a basic needs approach dealing with poor housing, inadequate water supplies and sanitation, lack of educational opportunities, and insufficient health care, has been introduced. The goal is to encourage programs that will directly affect the poorest of the population. The current health care strategy, attempting to ensure universal access to reasonable levels of health, has profound financial implications. Initial investment costs are estimated to be about $20 per person and will probably be overshadowed by recurrent operating expenditures. Further it is believed that investment costs of new health care activities can often be financed through official or private external donors while recurrent costs will have to be met by individual countries. These operating costs are estimated to be in the US$6-15 per capita range, much higher than the US$.60 to US$2.00 range now being spent. However, voluntary organizations and individuals are spending additional funds for health care in such areas as private health care, non-prescription drugs, transportation and indigenous individuals like herbalists. The total level of spending suggests that with a reallocation of resources better care could be financed. Another consideration is that the importation of most drugs and supplies will require a country's ability to participate in a foreign exchange program. The major principles of health care finance should include establishing equity among clients in ability to pay principles, encouraging appropriate usage of health services, prohibiting policy which promotes excessively costly services, and being feasible. Part of an appropriate design of the financing system should include having operating costs born locally as much as possible. Additional specific recommendations for successful health care financing are made.

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