health care financing and foreign aid in bangladesh

8/2/2019 Health Care Financing and Foreign Aid in Bangladesh

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AbstractHealth is a basic requirement to improve the quality of life. A national economic and socialdevelopment depends on the state of health. A large number of Bangladeshs people, particularlyin rural areas, remained with no or little access to health care facilities. The lack of participationin health service is a problem that has many dimensions and complexities. Education has a

significant effect on participation in health services and administrative factors could play asignificant role in increasing the peoples participation in Bangladeshs health sector. But thepresent health policy is not people oriented. It mainly emphasizes the construction of ThanaHealth Complexes (THCs) and Union Health and Family Welfare Centers (UHFWCs) withoutgiving much attention to their utilization and delivery services. The study reveals that financialand technical support is very helpful to ensure health service among village people. However, theGovernment allocates only 5 percent of the budget to the health sector, while it allocates 13percent for defense. The paper shows that the Governments allocation and technical support(medical equipments) are not sufficient in the rural health complex and that the peoplesparticipation is far from being satisfactory. The paper concludes with a variety ofrecommendations.

IntroductionBangladesh is a mostly rural, developing country of South Asia, located on the northern shore ofthe Bay of Bengal, covering 147,570 square km. People of this country are known ashardworking, with proven capability to preserve mental strength in the event of unexpectedextensive loss due to natural calamities, such as floods, cyclones, epidemics, etc. But, their basicneeds have remained unfulfilled. Health is a basic requirement to improve the quality of life.National economic and social development depends on the status of a countrys health facilities.A health care system reflects the socio-economic and technological development of a countryand is also a measure of the responsibilities a community or government assumes for its peopleshealth care. The effectiveness of a health system depends on the availability and accessibility ofservices in a form which the people are able to understand, accept and utilize. The Governmentof Bangladesh is constitutionally committed to the supply of basic medical requirements to alllevels of the people in the society and the improvement of nutrition status of the people andpublic health status (Bangladesh Constitution, Article-18). The health service functions wereinitially restricted to curative services. With the development of modern science and technology,health services emphasize promotive and preventive rather than curative health care. Yet, a largenumber of people of Bangladesh, particularly in rural areas, remain with no or little access tohealth care facilities. It would be critical for making progress in Bangladeshs health services toimprove the peoples participation in the health sector. The Government therefore seeks to createconditions whereby the people of Bangladesh have the opportunity to reach and maintain thehighest attainable level of health. Bangladesh has a good infrastructure for delivering primaryhealth care, but the full potential of this infrastructure has due to lack of adequate logistics neverbeen utilized.The aim of this study is to find out different aspects of health care financing in Bangladesh. Thisincludes sector wise contributions, necessity of foreign aid in health sector, significance offoreign aid, reducing burden of poverty on catastrophic health expenditures by means ofprogressively expanding national health care insurance, providing more reliable estimates ofhousehold out-of-pocket( OOP) expenditure on drugs by alternative and mutually consistent


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sources like surveys, administrative records and international drug monitoring market researchdata and finally, suggested measures to remove the problem of health care financing and itsutilization.

Scope and MethodologyThis study is based on analysis of prevailing health care financing system in Bangladesh. Datahave been collected from various published books, scholarly journal articles, daily newspaper,UNAID, WHO, WB, MOHFW and internet browsing. Due to lack of available sources ofprimary or raw data, secondary data has been used. This paper also includes health carefinancing in foreign aid perspective and foreign aid effectiveness in inequality in infant, childand under five mortality perspective. Many descriptive statistics i.e. data tables, statistical bardiagram, time series diagram are used for financing in the health sector in Bangladesh.

Research ProblemHealth service is one of the fundamental rights of the people. It is the constitutional liability of

the state to ensure adequate health service delivery to the people (Bangladesh Constitution,Artcle-18). However, in the case of Bangladesh, the state is not able to deliver door to doorhealth service as yet. There are various reasons responsible for this condition. One of the mainreasons is that Bangladesh is an overpopulated country. It is a difficult task for the government toensure health services for its population of about 160 million people. In 1978, the World HealthOrganization (WHO) declared Health for All by the year 2000 in the Alma Ata Declaration.However, this grand vision of primary health care for all has not yet been achieved inBangladesh. To the contrary, despite some progress, Bangladesh remains a country wherepoverty prevails at its gravest rate, income inequality is enormous, and the effective literacy rateis low. Basic primary health care services are not accessed equally and the marginalized peopleof rural Bangladesh are treated in a highly discriminatory nature to access health facilities.Actually, the reliable source of data about health care financing in Bangladesh is insufficient.But, some kinds of traditional data about these are also available in internet. Besides, there isalso time constraint for this purpose. But, I have tried my best to present this research paper moreaccurately.

Health Care FinancingHealth care financing system is operated through the Governments revenue and developmentbudget. Estimated expenditure amounts to 6% of the total government budget. Large part ofrevenue expenditure is incurred for salary support of the government employees anddevelopment expenditure is utilized for health developmental activity. A significant part ofdevelopment budget comes from the external sources which include World Bank and co-

financiers, bilateral donor agencies as well as UN agencies, including WHO, UNICEF, andUNDP.Expenditure for health and population sector has been growing steadily. The major part offunding was channeled through Operational Plans of HPSP and currently HNPSP. This isimplemented through a sector wide approach (SWAp) supported by a consortium of the WorldBank and ten multi-lateral and bilateral donors. WHO plays a key role as a technical agency aswell as executing some of the components of 2003-2010 HNPSP.


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The management of SWAp and implementation of HPSP and current HNPSP is an example ofpartnership with multiple stakeholders which carries lessons for the implementation of the nextPRSP and PHC service delivery.Although there is a clear government policy that all citizens will get free services in allgovernment facilities, informal and unofficial charging is widely practiced. The Baseline Service

Delivery Survey for HPSP conducted in 1999 found that 22% of people make an extra paymentto the workers when they visit government health services and 27% pay an unofficial registrationfee.

ICHA-HF Classification of Health Care Financing: Three-Digit

Level--------------------------------------------------------------------------------------------------------------------

ICHA code Sources of funding---------------------------------------------------------------------------------------------------- HF.1 General government

HF.1.1 General government excluding social security fundsHF.1.1.1 Central governmentHF.1.1.2 State/provincial governmentHF.1.1.3 Local/municipal government

HF.1.2 Social security fundsHF.2 Private sector

HF.2.1 Private social insuranceHF.2.2 Private insurance enterprises (other than social insurance)HF.2.3 Private household out-of-pocket expenditure

HF.2.3.1 Out-of-pocket excluding cost-sharingHF.2.3.2 Cost-sharing: central government

HF.2.3.3 Cost-sharing: state/provincial governmentHF.2.3.4 Cost-sharing: local/municipal governmentHF.2.3.5 Cost-sharing: social security fundsHF.2.3.6 Cost-sharing: private social insuranceHF.2.3.7 Cost-sharing: other private insuranceHF.2.3.9 All other cost-sharing

HF.2.4 Non-profit institutions serving households (other than social insurance)HF.2.5 Corporations (other than health insurance)

HF.3 Rest of the world

Explanatory notes to the ICHA-HF classification of sources of funding

HF 1 General governmentThis item comprises all institutional units of central, state or local government, and socialsecurity funds on all levels of government. Included are non-market non-profit institutions thatare con-trolled and mainly financed by government units ( SNA 93, 4.113-4.130).HF.1.1 General government excluding social security fund

This item comprises all institutional units of central, state or local government. Included arenon-market non-profit institutions that are controlled and mainly financed by government units(SNA 93, 4.113).


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HF.1.1.1 Central government

This item comprises all institutional units making up the central government plus those NPIsthat are controlled and mainly financed by central government (SNA 93, 4.117-4.122).HF.1.1.2 State/provincial government

The state/provincial government sector consists of state governments which are separate

institutional units plus those NPIs that are controlled and mainly financed by state government.States and provinces may be described by different terms in different countries. In smallcountries, individual states/provinces and state/provincial governments may not exist (SNA 93,4.123-4.127).HF.1.1.3 Local/municipal government

The local government sub-sector consists of local governments that are separate institutionalunits plus those NPIs which are controlled and mainly financed by local governments. Inprinciple, local government units are institutional units whose fiscal, legislative and executiveauthority extends over the smallest geographical areas distinguished for administrative andpolitical purposes (SNA 93, 4.128).HF.1.2 Social security funds

The social security funds sub-sector consists of the social security funds operating at all levels ofgovernment. Social security funds are social insurance schemes covering the community aswhole or large sections of the community and that are imposed and controlled by governmentunits (SNA 93, 4.130).HF.2 Private sector

This sector comprises all resident institutional units which do not belong to the governmentsector.HF.2.1 Private social insurance

This sector comprises all social insurance funds other than social security funds. Includes:programmes that are set up by government for their employees only.HF.2.2 Private insurance enterprises (other than social insurance)

This sector comprises all private insurance enterprises other than social insurance.HF.2.3 Private household out-of-pocket

expenditure

The definition of a household which is adopted by survey statisticians familiar with the socio-economic conditions within a given country is likely to approximate closely the concept of ahousehold as defined in the SNA and consequently will also be in most cases appropriate for thepurposes of health accounting (see SNA 93, 4.134).HF.2.4 Non-profit institutions serving households

(other than social insurance)

Non-profit institutions serving households (NPISHs) consist of non-profit institutions whichprovide goods or services to households free or at prices that are not economically significant(SNA 93, 4.64).HF.2.5 Corporations (other than health

insurance)

This sector comprises all corporations or quasi corporations whose principal activity is theproduction of market goods or services (other than health insurance). Included are all residentnonprofit institutions that are market producers of goods or non-financial services (SNA 93,4.68).


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HF.3 Rest of the world

This item comprises institutional units that are resident abroad. This includes foreign aid, privateinsurance premiums etc.

Health care financing in Bangladesh perspective

Global spending on health totaled about $ 2.3 trillion in 1994, or about 9 percent of total globalincome. High income countries,$ those with per capita income above $8500 in 1994 spent justover $ 2 trillion, amounting to 89 percent of total health expenditure, while their populationsaccounted for 16 percent of global population. In USA, for every $7 spent, $1 goes for financingthe health sector. Developing countries, with 84 percent of the worlds populations, accountedfor only 11 percent of all health spending (Health affair, 1999)Governments limitations in capacity

Limited resources and administrative capacity coupled with strong underlying needs for servicespose serious challenges to government in the developing world. Even the richest countries of theworld are facing limitations in financing the health sector because of rising medical cost, and aregradually shifting towards alternative financing mechanisms.

WHO recommends that countries should adopt an essential set of interventions with averagecosts of $3040 per person. South East Asian countries, on average, had total health expenditure(THE) of only $12 per person(WHR,2001).There is evidence to show that health systems, which spend less than approximately $60 percapita, find it difficult to deliver a reasonable, minimum range of services.Health care financing in different countries

Now-a-days, different countries are adopting health care delivery systems in which the state doesboth the financing and provisioning, or shares with the private sector in diverse combinations.At present, there are several systems of payments in vogue in USA: Medical, Medicaid, Fee forServices (FFS), Deductibles, Indemnity, Copayments, Insurance, various combinations of theabove, and others.

All these systems are costs sharing and cost pooling methods among the consumer, government,insurance companies and other third party payers, so that treatment expense does not become anysingle partys burden, thereby maintaining the right quality of the care.Other systems, like NHS in UK, National health accoutsin the Philippines, Egypt, Mexico,Colombia, Zambia, and BAMAKO Initiative (Community financing) of Thailand, are measuresof cost pooling in health sector that have emerged with success.Health care financing in developing countries

Low income countries can only raise revenue equivalent to 20 percent of their GDP, less thanhalf of the 42 percent in high income countries. If a basic package of primary care and preventiveservices were to cost somewhere around $1520, then a low income country must devote one-quarter to one-third of its government budget to the health sector.

There are sometimes supplemented by user fees, but these constitute a very small percentage ofpublic revenue. External assistance continues to be a significant revenue sources. Thus,ironically, the poorest countries have the highest out-of-pocket spending as a percentage ofincome.Bangladesh perspective

In Bangladesh, approximately 35% of the health sector funding of the government is coordinatedthrough a large consortium of donors and aid agencies, headed by the World Bank. The Bank


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heads a consortium of 10 donors that funds around a third of the health ministrys budget, withover 30 multilateral and bilateral organizations supporting the ministry of health.Some 500 NGOs operate in the health, nutrition, and population sectors in Bangladesh. Amongthe best known is the Bangladesh Rural Advancement Committee (BRAC), which reachesaround 17 million people.

The Banks fourth population and health project in Bangladesh, which has disbursed around$780 million over six years with $190 million from the bank, $282 millions from other donors,and $310 million from the Bangladeshi government.Bangladesh today spends almost $12 per capita in the health sector, of which $4 comes from thepublic sector. Of the 63% spending from out-of-pocket, 46% is on drugs from privatepharmacies, much of this spending is on party or wholly ineffective or inappropriate medicines.Concept of resource pooling in Bangladesh

Pooling of resources refers to the accumulation of health on behalf of a population. Bypooling of resource, the financial and health risks are spread and transferred among thepopulation. The essence of health insurance is pooling of funds and spreading the risk forillness and financing.

A significant bulk of health care financing in Bangladesh is coming from OOP and informalpayment, which indicates that people are willing to pay for better care to supplement theresources staved and ineffective public health sector.An implication is that households are forced to pay for health care when their ability to pay is atits lowest limit. Channeling this money into an organized health insurance scheme would reducepayment at time of illness and spread the cost of care across time and individuals.A limited resource means that much of the allocation is spent on building and staff, with littleleft over to purchase medicines and other supplies. Based on an income related contribution(average premium of Taka 500 per person annually, or Taka20002500 per household), socialinsurance could contribute up to 8 per cent additional revenue for the sector, and communityinsurance would extend funding by at least another 4 per cent (HEU, 2001).A good financing system must envisage contributions based on ability to pay, distribution basedon need, reduction of the burden of unexpected catastrophic risks, and must be managed in a waythat is accepted as transparent and trustworthy.There should be progressive taxation for the higher income groups, and univeralization of accessto health services by subsidizing the poor using both local and outside funds coming both frominside and outside the health sector (in Vietnam, it has been proposed that, in rural areas: Thegovernment should end up paying 75 percent of all heath care costs; the community 10 percent;foreign aid 10 percent; and user fees 5 percent. In urban areas: taxes should cover 5060 percentof the costs; health insurance 20-25 percent; fees 10 percent; and foreign aid 5 percent).There is no escape. In one way or another, the government has to increase its health spending.The main challenge will ultimately be to convince people that what is proposed is for them toreduce their envelope payments, and, instead, pay a clearly identified local health tax withsafety net for the poor.If a strong argument is to be made for these resources to be channeled into the public sector, orother forms of organized financing, society must be convinced that the resources will be usedeffectively. Without this assurance, it is likely to prove impossible for the policy makers toconvince the public that health service resource mobilization is not "just another tax," and evadeit accordingly.


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Private Household Out-of-pocket Health Expenditures in Bangladesh

A less apparent but important source of private spending is underthetable, or informal,payments by patients to public sector providers. The analysis of WHR, 2002, indicated thatmost countries in South East Asia have more than 50 per cent of the revenue coming fromOOP.

Recent studies in thana and district facilities in Bangladesh have found between 2030 per centof users reporting payments (CIET, Canada 2000). Payments vary between Taka 40140 (Taka1027 on average for all patients). For large medical procedures payment can be considerablyhigher, Taka 1275 for normal delivery and Taka 4700 for caesarean section (Nahar, 1998).

Sources of health care financing

Household OOP the Dominant source of financing accounting for 65% of the healthcare financing.

MOHFW accounts for 20%. Donors (Development partners) around 12%.

Providers, Bangladesh 1999-2000 (in %)

This diagram shows a overall structure of health care financing in period 1999-2000 in

Bangladesh.


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Distribution of Benefit from Public Health Subsidy in Bangladesh

Inpatient Outpatient Other Total subsidy

KakwaniIndex

-0.1023 -0.2130 -0.3445 -0.1958

More subsidy received by poor in outpatient compared to inpatient services. Primary healthcare subsidies are pro poor.

Poverty Impact of OOP Healthcare Household Expenditures in Bangladesh 1999-2000

Povertyheadcounts Per capita consumptionBelow PPP $1/day Per capitaconsumption BelowPPP $2/day

Pre-payment 21.8% 71.5%

Post-payment 25.3% 73.8%

Poverty impact 3.5% 2.3%

Poverty line 1 ($1/Day): About 22% households subsist below poverty. Healthcare payments push approximately 4% households below the poverty. Poverty line 2 ($2/Day): About 72% households fall under the poverty line 2 Healthcare payments push approximately 2% households below poverty


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Pre-payment and post-payment consumption, 1999-2000

Out-of-pocket spending occurs across the entire income distribution but the greaterpayments occur primarily among the better-off households

Foreign Aid For Health Care Financing: Bangladesh PerspectiveThe socio economic condition of Bangladesh is characterized by widespread poverty,malnutrition and unhealthiness. The present configuration of unhealthiness has been caused bylack of access of the majority of the population to resources and development benefits. Sinceindependence in 1971, Bangladesh has made progress in reducing poverty and lifting its Human

Development Indicators from extremely low levels. The 2005 Household Income andExpenditure Survey (HIES) shows that poverty declined to 40% from about 50 % in 2000 (BBS,2007). Despite improvement in the reduction of poverty and selected health indicators,Bangladesh remains a low income country, with weak social indicators and pockets ofextreme poverty. The country is also vulnerable to natural disasters like flood, cyclone,sidor etc. In this situation, foreign aid is badly needed to run the health care activities inBangladesh. These activities include maternal health, child health, average life expectancy,primary health care, nutrition programme, and so on.Development partners assistanceOver the last 35 year period history, Bangladesh has received USS 15 billion in aid. Itranks 38thof 76 countries under the International Development Association (IDA). Assistance

from DPs for health development has been available since 1972, shortly after independence.Before 1998 funding was channeled to different health projects with their defined objectives andactivities in specific areas. In order to bring efficiency to the system of planning, monitoring andmanagement, and for harmonization and alignment of donor support to national plans andstrategies, a sector-wide approach (SWAp) was introduced in the health and population sector,with the launch of the Health and Population Sector Programme in 1998 (HPSP 19982003).Based on the lessons learned from the HPSP implementation and revised Government policyoptions, the current HNPSP 2003-10 was formulated and later revised in consultation with all


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DPs in 2005. It continues to be structured on the SWAp concept, and places greater emphasis onserving vulnerable populations through client-focused and better utilized essential healthservices. Contributions of DPs in both pool and non-pool funds of the revised HNPSP aredepicted in Table 1. There are pool funding, non-pool funding and parallel funding mechanismsin the HNPSP for development assistance to the Government. Contributions to the pool fund of

the HNPSP have been pledged by a consortium of donors led by the World Bank/IDA. Most ofthe UN agencies are non-pool contributors. Non-pool funding has been pledged by DPs toaccomplish their specific objectives within the umbrella of the HNPSP. An amount of US$ 580million has been pledged in the HNPSP as non-pool fund. Considering the present trends inresource mobilization, WHOs estimated contribution of US$ 46 million for the HNPSP periodof 2005-10, made in 2004, was too low and has already been exceeded in 2007. The HNPSP atpresent does not support programmes beyond the MOHFW, and has no scope to shape policiesand strategies in other related ministries.Foreign aid effectiveness in Bangladesh:Inequity in infant, child and under-five mortalityIn order to find out the aid-effectiveness on life expectancy, it is necessary to estimate theinequality in health conditions in terms of infant, child and under five-mortality between the rich

and the poor. The effectiveness of aid will not be visible unless there is a reduction in mortalityamong the poor because roughly 40% of the population is poor. If the health care services do notreach to the poor, the effectiveness of aid will be difficult to measure. In order to understand theextent of poor and rich gap in under five-mortality principal component analysis was carried outusing the household asset variables. Information regarding the household items (i.e. television,radio, electricity, refrigerator or car) and ownership of household structure and cultivable landwere assigned a weight or factor score generated through principle component analysis.

Figure-1 Trends in Infant, Child and Under Five Mortality, 1993 to 2007.

Source:BangladeshDemographicandHealthSurvey2007The resulting scores were distributed normally with mean zero and standard deviation one. Eachhousehold was assigned a standard score for each asset. Inequalities by income in mortality thereof are measured here using a concentration index. Concentration index is a generalization of theGini coefficient i.e. proportion of population up to midpoint of each interval group. Infantmortality rates by different quintiles for successive four surveys are presented in Figure 2for the five-year period preceding the surveys. Comparisons of infant mortality estimates


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over time show continued declines with a faster decline during the period 2004-07. Overthe last two decades infant mortality has declined by about 38 percent. The poorest-richest ratioof infant mortality was 1.3 in 1993-4 and since then it is widened between the poorest and richestratio increased to 1.6 from 1.3.

Table: 1 Infant mortality rates by Economic Status

BDHS1993-94

BDHS1996-97

BDHS1999-2000

BDHS2004

BDHS2007

Poorest 94.4 91.8 85.2 81.8 62.7

Poorer 104.1 92.3 74.4 53.3 65.3

Middle 90.3 93.0 69.4 78.7 57.6

Richer 81.9 92.1 61.2 53.7 49.2

Richest 71.7 58.4 53.9 50.2 38.8

Total 88.6 86.3 68.5 65.2 54.5

Poor-rich ratio 1.3 1.6 1.6 1.6 1.6Concentrationindex(CI)

-0.0604 -0.0564 -0.0887 -0.0703 -0.088

St.Error (CI) 0.0208 0.0474 0.0195 .0338 .001

t-test(CI) -2.91 -1.19 -4.55 -2.08 -2.66

Similarly, the poorest richest ratio of under five mortality has also increased from 1.5 in 1993-4 to 1.8 in 2004 suggesting thepoor and rich gap has increased (Table 2 ).This is also supported by the values of Concentration Index (CI). The CI for under five mortality was 0.0594 in 1993-94 and .1060 in 2004 respectively. The negative value of concentration indices indicatesmortality favor the poor and its corresponding t-value reveal that there are

significant inequalities among the rich and poor groups.

Table 2: Under five mortality rates by wealth index

BDHS

1993-94

BDHS

1996-97

BDHS

1999-

2000

BDHS

2004BDHS 2007

Poorest 133.7 111.6 112.5 104.1 70.1

Poorer 132.9 123.0 91.0 73.8 72.9

Middle 134.6 135.8 95.8 96.8 71.7

Richer 125.0 118.9 70.5 64.6 70.8

Richest 91.4 76.9 64.0 58.2 48.3

Total 123.5 114.3 86.9 80.3 66.3

Poor-rich ratio 1.5 1.5 1.8 1.8 1.5

Concentration index (CI) 0.0594 0.0454 0.1093 0.1060 0.0483

St. Error (CI) 0.0348 0.0544 0.0272 0.0364 0.0017

t-test(CI) 1.71 0.83 4.01 2.91 1.17


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Figure 2 shows the concentration curve on infant mortality. The diagonal line indicates the lineof equality. Curve above the diagonal indicates that infant mortality favors the poor. The fartherthe curve is above the equality, the more concentration in infant mortality amongst the poor. Allcurves in different surveys clearly indicate the infant mortality concentrated among the poor

Similarly, Figure 3 also shows that inequality in under five mortality between poor and rich hasbeen increasing over time. Detailed analyses all the BDHSs data demonstrate that children ofpoorest family suffered more in mortality than the children of rich family. If the gap can benarrowed down between the poor and the non-poor, there will be moreimprovement in the overall health status of the population.

Figure 2: Concentration Curve of Infant Mortality

Figure: 3 Concentration Curve of Under Five Mortality by BDHS


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The following figure 4 provides the trends in allocation and utilization of aid between 1980 and2004. As evidence from table, total sectoral allocation increased 27 times during the period ofstudy. Both governments allocation and donors allocation also increased substantially. Donorsallocation increased 80 times compared 1980 level while government allocation increased only13 times of 1980 level. However utilization was much lower in project aid increased

substantially which might have influenced on the overall health status of the population.Share of project aid is shown in Figure 5. As the figure suggests the increased share andutilization of aid in 1990s are also supported by the rapid decline in infant and under fivemortality, increased coverage of immunization and increased in life expectancy at birth.

Figure 4. Allocation in Health Sector by Sources (Project Aid and Government)

Figure 5: Share of Project Aid and Utilization in Health Sector by Source.


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The above discussion shows that foreign aid is a very factor in our country after 1980s. Theabove tables show that infant mortality and under five mortality substantially reduce over time.This evidence shows that foreign aid is more effective in this case. But the figure 2 shows thatover the time of study, the inequality between rich and poor roughly increases. Figure 5 showsthat foreign aid or project aid is very important in health care financing in Bangladesh.

FindingsHealth is basic human need. Every human being should have a capability or entry in health careprogramme. As Bangladesh is a poor, over populated country, its health sector financing is closelydependent on foreign aid. Bangladesh receives grant from UNAID, WHO, WB etc. The domestic source

includes government expenditure, NGOs insurance etc. In Bangladesh, approximately 35% of thehealth sector funding of the government is coordinated through a large consortium of donors andaid agencies, headed by the World Bank. Bangladesh today spends almost $12 per capita in thehealth sector, of which $4 comes from the public sector. Of the 63% spending from out-of-pocket, 46% is on drugs from private pharmacies, much of this spending is on party or whollyineffective or inappropriate medicines.Besides, the foreign aid or grant is very important in Bangladesh in reducing infant mortality

rate, under five mortality rates etc.

Conclusion and RecommendationsHealth service is most important factor for human well being. Health services based on primaryhealth services have been expanding gradually in Bangladesh to improve the health status of thepeople, especially in rural areas where more than 85 percent of the people are living and areunderserved and underprivileged groups. So, in this situation to provide proper health care to allpeople, health care financing is very important. As Bangladesh is partly dependent on foreignaid, the government of Bangladesh is trying to find out better internal source of funding. TheGovernment also tries to motive the people to use the existing health facilities, but most of thepeople are not willing to use modern health care facilities due to the ignorance and traditional

mentality of rural people. Besides, we should have a close outlook in proper utilizing the foreignaid.

On the basis of our findings we present the following recommendations:

Though the National Health Policy is essentially people-oriented, our analysis shows thatthe problem lies in the implementation of these policies. So the Government needs tomodify its traditional process and be more people-oriented.

Bureaucratic response is also very important in the health sector. So the bureaucraticresponse should be a positive view to the mass people for ensuring proper financing inhealth.

The Government needs to make sure that the donors view does not negatively influenceits policy making and implementation in the health sector.

Given that the Government receives foreign funds, they are accountable to the foreigndonors. But the Government should also keep in mind national interests. Donorsperformance may go against national interests. So the Government should try to becomeindependent from the donors.

Regular monitoring and supervision should be adopted in government health sector forensuring proper financing in every sector in health.

Government should take proper steps to increase internal financing.


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Government should try to remove hard and fast conditions of donors in receivingforeign grant.

Due to lack of proper information, time, and experience, probably I have not presented this paperaccurately. But I have spent my best effort in making this paper. If I get a chance in future,fortunately, then I will try to make this paper more accurate and more attractive.

References Ministry of Health and Family Welfare, Government of the People's Republic of

Bangladesh.

World Health Organization World Bank UNAID The Daily Star, Dr. Zulfiquer Ahmed Amin, a physician, is specialist in Public Health

Administration and Health Economics

ICHA-HF

Data International Ltd. A.K.M. Ghulam Rabbani. Bangladesh Demographic and Health Survey 2007. Dhaka: National Institute for

Population


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An assignment

on

Health Care Financing and Foreign AidIn Bangladesh

Submitted to

Rumana HaqueCourse TeacherDepartment of EconomicsUniversity of Dhaka

Submitted by

Taposh Kumar Roy4th year, Roll no:119Department of EconomicsUniversity of Dhaka


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Date of submission:

health care financing and foreign aid in bangladesh

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