Institutional design and organizational practice for universal coverage in lesser-developed countries: Challenges facing the Lao PDR

Abstract

There is now widespread acceptance of the universal coverage approach, presented in the 2010 World Health Report. There are more and more voices for the benefit of creating a single national risk pool. Now, a body of literature is emerging on institutional design and organizational practice for universal coverage, related to management of the three health-financing functions: collection, pooling and purchasing. While all countries can move towards universal coverage, lower-income countries face particular challenges, including scarce resources and limited capacity. Recently, the Lao PDR has been preparing options for moving to a single national health insurance scheme. The aim is to combine four different social health protection schemes into a national health insurance authority (NHIA) with a single national fund- and risk-pool. This paper investigates the main institutional and organizational challenges related to the creation of the NHIA. The paper uses a qualitative approach, drawing on the World Health Organization's institutional and Organizational Assessment for Improving and Strengthening health financing (OASIS) conceptual framework for data analysis. Data were collected from a review of key health financing policy documents and from 17 semi-structured key informant interviews. Policy makers and advisors are confronting issues related to institutional arrangements, funding sources for the authority and government support for subsidies to the demand-side health financing schemes. Compulsory membership is proposed, but the means for covering the informal sector have not been resolved. While unification of existing schemes may be the basis for creating a single risk pool, challenges related to administrative capacity and cross-subsidies remain. The example of Lao PDR illustrates the need to include consideration of national context, the sequencing of reforms and the time-scale appropriate for achieving universal coverage.