Financing and budgeting practices for health in Peru

Abstract

Peru has made substantial progress towards achieving UHC. Increases in access to healthcare and financial protection had a positive impact in health outcomes. Despite this progress, major efforts are needed to reduce fragmentation and increase efficiency in the health system as a whole. Creating formal coordination mechanisms and improving capacity at the subnational level are key elements to ensure that any additional resource spent has a great positive impact in Peru’s health care system. The well-developed and highly institutionalised PPR methodology in Peru can inspire other countries in the LAC region. However, other budgetary practices could be better aligned with OECD recommendations of good budgetary governance. In particular, making the approved budget closer to what is expected to be executed would greatly increase the usefulness of the budget, showing how resources are prioritised and how annual policy objectives are to be achieved. JEL codes: H5, H60, I11, I18 Keywords: Universal health coverage UHC, Peru, health expenditures, budget formulation, budget execution, budget monitoring, fiscal sustainability of health systems