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The complex quest for coordinated health financing in Cambodia

Bart Jacobs and Cambodian participants of Leadership for UHC programme in 2016

A German-supported coordination mechanism, and one key advisor in particular, indicate a possible way forward with the big ‘4Gs’. 

‘Donor harmonisation depends a lot on individuals’ mused a somewhat disenchanted Bart Jacobs, long-time social health protection policy advisor for Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH in Cambodia. In early 2020, Jacobs reflected on his and the German Development Cooperation’s efforts to bring international partners together to align to, and strengthen, the national health financing system. ‘We take some steps forward, then fall backwards when these individuals leave the country. So many people “wait and see”, or they try to re-invent everything, ignoring what has been achieved’. To someone who had worked in Cambodia on and off for the past 20 years, it was evident that progress in development partner coordination requires consistency, and that – although difficult to achieve – it is worth trying because ‘we recognise our limited budget, and that we can multiply our impact by working with others’.

The importance of health financing for universal health coverage 

Cambodia is committed to universal health coverage (UHC), aiming to give all citizens access to the quality health services they need without the risk of financial hardship. Removing financial barriers to health care is an essential component of UHC. Therefore, UHC-focused reforms typically incorporate strategies to improve revenue collection and increase overall funding for the health system, prioritise spending on services known to be effective, efficiently purchase health services to ensure equitable financial access, and pooling of funds to spread financial risk. Together, these measures are referred to as health financing and constitute a core building block for UHC.

Despite significant health system improvements alongside its sustained economic growth over the last two decades, Cambodia’s health outcomes still rank among the poorest in the Southeast Asian region. Limited and unequal access to quality healthcare are among the root causes of this predicament. Patients’ out-of-pocket payments (OOP) for care or medication, often exceeding what poor families can afford, still account for over 60% of total health expenditure (THE) in Cambodia. Only about 20% of THE are covered by the government, with another roughly 20% funded by external development partners.

The ‘4Gs’ and the leverage of international health donors over the sector

Four international financing institutions stand out: the Global Fund to Fight AIDS, Tuberculosis and Malaria (GF), the Global Alliance for Vaccines and Immunizations (Gavi), and the Global Financing Facility (GFF) are the three largest global health initiatives – collectively referred to as the ‘3Gs’ – that raise and allocate funds to strengthen health systems in low- and middle-income countries. Together with the World Bank Group they are the ‘4Gs’; the World Bank hosts the GFF and runs the high-profile Health Equity and Quality Improvement Project (H-EQIP) in Cambodia.  

With international partners funding around one fifth of Cambodia’s THE, they wield considerable influence over the country’s health sector. Through their mandates or decisions, they determine which health areas are funded, thereby setting the agenda. The international partners’ results frameworks and the indicators to be met set powerful financial and political incentives because ‘what gets measured gets done’. 

High transaction costs from dealing with the multitude of partners and programmes

The financial and technical assistance from the 4Gs is indispensable for the health sector in Cambodia at present. However, to make it work, the government must be flexible and adapt to the fundamental differences in how the institutions operate – not the other way around: The World Bank and, to a lesser extent, GFF pursue a comprehensive approach to health system strengthening. The Global Fund has started trying to invest in resilient health systems broadly, but with only around one quarter of its overall resources and with mixed results. For the most part, Gavi and the Global Fund focus on targeted technical interventions in line with their narrow, disease-specific mandates. While the World Bank and GFF are guided by the principles of performance-based financing that ties the release of funds to the achievement of results, the other two organisations provide traditional input-based funding on the assumption that better outcomes follow from better inputs and processes.

In addition to each financing institution having its distinct mandate and policy priorities, they also require the government to adhere to their respective administrative, financial management and reporting procedures. In a stocktaking and discussion paper on sustainable health financing, the 4Gs came to the sobering conclusion that their approach to investing and aligning with national health priorities remained fragmented, not optimally coordinated, and imposed high transaction costs on the country.

Coordination and alignment – on paper and in practice

The 4Gs recognise that they can increase their impact on global health if they coordinate themselves effectively and align their work with country policy priorities. Therefore, in response to a proposition by the Ghanaian, Norwegian and German governments to the World Health Organization (WHO), they launched the Global Action Plan for Healthy Lives and Well-being for All (GAP), along with eight other multilateral health, development and humanitarian agencies in 2019. The GAP consists of a series of commitments and proposed actions by the twelve signatories to strengthen their collaboration with each other and with countries under seven ‘accelerator themes’, one of them being sustainable health financing (SFHA). The agencies vow to align their support around national plans and strategies that are country owned and led.

Bart Jacobs and P4H colleagues
Bart Jacobs and P4H colleagues

However, when launching the GAP, the agencies did not put in place the majority of the strategic and technical underpinnings to make coordination work in practice. For example, by mid-2020, shared monitoring arrangements, indicators and milestones had not yet been agreed upon. Nonetheless, promising instances of greater collaboration and coordination are emerging: in Lao PDR, the World Bank will manage the Health and Nutrition Services Access Project (HANSA, 2021-25), with contributions from the Global Fund and Gavi – although their financial management procedures will still not be integrated with those of the Bank.

In most countries, including in Cambodia, the 4Gs continue doing business as usual, with the high transaction costs that this implies. Coordination and alignment among the 4Gs in Cambodia are complicated by the fact that Gavi and the Global Fund do not have a presence in the country. Being managed from Geneva, they try to call in but miss many of the important face-to-face meetings.

P4H as informal, practice-oriented coordination mechanism for health financing partners

Recognising that effective health financing for UHC requires a comprehensive approach, also through collaboration and coordination with actors from beyond the health sector, several development partners – including GIZ – came together to form the Health Financing / Social Health Protection Network (P4H) in Cambodia. 

First started in 2009 and revamped from 2014 onwards, P4H went through various configurations and finally took shape as P4HC+ with 15 bi- and multilateral partners by 2016. WHO, USAID and the World Bank are the current co-chairs of the informal network, supported by a small secretariat of staff from the Swiss Development Cooperation and GIZ advisors, working on behalf of Germany’s Federal Ministry for Economic Cooperation and Development (BMZ). GFF became a network member in 2019. Gavi and the Global Fund – lacking an in-country presence – do not partake in P4HC+.

The network represents development partners engaged in health financing vis-à-vis the government. The main government counterpart of P4HC+ is the General Secretariat for the National Social Protection Council, housed in Cambodia’s Ministry of Economy and Finance (MEF) and chaired by the Deputy Prime Minister who is also the Minister of Economy and Finance. Despite its linkage to MEF, ‘P4H brings the added value in that it can work across ministries’, says Thorsten Behrendt, GIZ’s Team Leader Health Financing / P4H. This is different from what 4Gs normally do, where each institution works with just one main counterpart, typically MEF or the Ministry of Health.

A ‘safe space’ for partners

Without a formalised operating framework, P4HC+ relies on the dedication and commitment of individuals to make it work. Bart Jacobs, the GIZ advisor and P4H focal person in Cambodia, was a key figure who helped lead and coordinate the network since 2013. Deeply knowledgeable of the Cambodian context, Jacobs was a practitioner with a keen interest in scholarship and made regular contributions to his policy and academic fields. He was highly respected among government and development partners alike. Thanks to Jacobs’ humble yet passionate efforts, ‘P4HC+ provided a “safe space” for partners’, says Somil Nagpal, a senior health specialist with the World Bank and former task team leader for H-EQIP. ‘Everyone could easily trust Bart – his interest for Cambodia was beyond doubt’.

It was also owing to Jacobs that P4HC+ has evolved into an effective platform to align its members’ health financing positions and work. ‘I found this to be the most regular and productive coordination platform that I ever joined’, concludes Nagpal.

A realistic proposal for better coordination, starting with ‘small wins’

Jacobs saw MEF’s increasingly prominent engagement in the health sector and its interest to better align funding streams from international partners as an opportunity for promoting greater coordination and alignment among the 4Gs for more effective health financing. He also considered the HANSA project in neighbouring Lao PDR as a sign that alignment of the activities of the 4Gs was feasible. However, he remained realistic regarding the challenges: ‘P4H is trying to align partners to a maximum extent but each institute has its own values, own principles’, said Jacobs in 2020. 

The integration of the 4Gs’ financial management systems would arguably yield the greatest reduction in transaction costs because it would eliminate the need for the government to follow utterly different sets of procedures. However, Jacobs knew that this was too much to ask. Therefore, the GIZ advisor developed recommendations for a ‘P4HC+-coordinated 4Gs Collaborative for Cambodia’. The proposal focuses on matters which, in Jacobs’ view, can be relatively easily achieved within a reasonable timeframe.

P4HC+ is at the heart of Jacobs’ ideas for better coordinating the work of the 4Gs. He suggested to give the network – including the Global Fund and Gavi who do not have personnel in country – a formal framing that would increase the acceptability of the collaboration among the Cambodian government. Jacobs also recommended developing a health financing strategy and implementation plan jointly with the government as a suitable activity to amalgamate the network members and their priorities. The list of recommendations is rounded off by a communication protocol and the transparent identification of roles, responsibilities and focal points on the partners’ and the governments’ side, facilitating exchange and alignment.

Practicing alignment by channelling international funds through national systems

Going beyond strategic coordination on an institutional level, Jacobs wanted to advance practical alignment of the international financing institutions with national health priorities and systems. The litmus test of development partner alignment would be channelling their funds through Cambodia’s health financing mechanisms instead of managing grants through their own onerous procedures. The challenges with the latter approach were abundantly clear. For example, the Global Fund’s grant allocation for Resilient and Sustainable Systems for Health (RSSH) was US$ 6 million for Cambodia for the 2018-20 period. By half time, in mid-2019, only 12% of the budgeted amount had been spent.

Bart Jacobs and Cambodian P4H members
Bart Jacobs and Cambodian P4H members

Jacobs realised that this ostensible accounting problem provided a powerful argument to push for greater alignment: If the country’s institutions were unable to access and use RSSH resources efficiently and timely enough through the Global Fund’s systems, why not route the money directly through the government’s existing health financing setup? Later in 2019, when several development partners commissioned an ‘options analysis’ for how to structure Cambodia’s proposal for the upcoming Global Fund funding cycle (2021-23), Jacobs and a group of consultants came up with a practical suggestion for how this could be done.

The innovative pitch centered around the Health Equity Fund (HEF), one of Cambodia’s most important social health protection schemes. The HEF enables poor people to access and utilise healthcare services in public facilities free of charge. It pays providers for services rendered to eligible populations and offers social assistance in the form of transport reimbursement, food stipends and funeral grants for the poor. Initially, the HEF was funded almost entirely by external development partners. Over the years, the government has increasingly taken over financial responsibility and control, now contributing over 70% of the HEF budget from domestic resources and aiming for 100% by 2025. Putting donor money through the HEF would be a strong sign of practical alignment. 

In their options analysis, Jacobs and his team proposed that a portion of the new RSSH grant should flow through the HEF for work streams in line with the Global Fund’s mandate: supporting health facilities to improve quality of care by expanding compensation for providing HIV, tuberculosis and malaria services. The experts suggested to start small, trying this out in only one to two provinces, allowing the Global Fund to get familiar with and test the efficiency and fiduciary soundness of the government health financing mechanisms. Although the Global Fund has not yet adopted this proposal for aligning RSSH resources, Jacobs’ options analysis provides an actionable way forward should the opportunity arise.    

Bart Jacobs died on 15 January 2021 following a tragic accident, aged 53 years, one month before he was scheduled to take up a GIZ secondment to the Global Fund in Geneva. His work would have focused on RSSH, allowing him to keep advocating for practical alignment of international development partner with national systems. Continuing his quest for better coordinated health financing to achieve UHC for all Cambodians would be an appropriate endeavour to honour Bart.

Clemens Gros, July 2021

Further reading

© GIZ / Franz von Roenne
© GIZ / Franz von Roenne
© GIZ / Franz von Roenne
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