Health financing is a core function of health systems that can enable progress towards universal health coverage by improving effective service coverage and financial protection. Today, more than half of the population in the WHO African Region cannot access the health services they need, with cost being one of the main barriers. Many are pushed into poverty as a result of paying for services out-of-pocket. Others receive poor quality of services even when they are able to pay out-of-pocket.
Carefully designed and implemented health financing policies can help to address these issues. For instance, the way health care providers are contracted and paid for services can incentivize care coordination and improved quality of care. Further, sufficient and timely disbursement of funds to providers can help to ensure adequate staffing and medical products to treat patients.
WHO’s approach to health financing focuses on the following core functions:
- Revenue raising (sources of funds, including government budgets, compulsory or voluntary prepaid insurance schemes, direct out-of-pocket payments by users, and external aid)
- Pooling of funds (the accumulation of prepaid funds on behalf of some or all of the population)
- Purchasing of services (the payment or allocation of resources to health service providers)