On September 21, 2021, the USAID Health Financing Activity (HFA), which is implemented by ThinkWell, sponsored the 7th Indonesian Health Economics Association (InaHEA) Biennial Scientific Meeting. This three-day gathering of some of the greatest minds in health economics in Indonesia presented an opportunity for attendees not only to share ideas to optimize resources under Indonesia’s national health insurance scheme, Jaminan Kesehatan Nasional (JKN), but also to frame these ideas around an urgent topic: COVID-19.
Researchers, academics, and policymakers from across various socioeconomic, geographic, and industry backgrounds discussed challenges the Ministry of Health of Indonesia (MOH) faces and how policymakers can tie health and finance together to find bold solutions.
COVID-19 in Indonesia
After an astronomical spike in COVID-19 cases in July, the MOH is diligently working to make sure JKN has the capacity to withstand the aftershock of such an unprecedented health crisis. Creating efficient policy around pandemic response requires an understanding of who needs COVID-19-related care and how much the care will cost per capita.
For the last year, Ryan Nugraha, one of ThinkWell’s Program Analysts in Indonesia; Ery Setiawan, Health Financing Specialist in Indonesia; and Ruli Endepe, ThinkWell’s data analyst consultant; have taken a deep dive into these two areas of health financing and they presented their findings at the conference. The following is an overview of key points from each presentation.
COVID-19 Cost of Primary Care Service
Ryan R. Nugraha and Ery Setiawan
In 2020, the Government of Indonesia passed a decree that makes all costs associated with COVID-19 treatment eligible to be reimbursed by JKN under a specific MOH payment mechanism using a cost-per-day rate. Though this policy was a quick response to the crisis, more information is needed in order to create a reimbursement rate that doesn’t lead to over- or under-provision of services and prevents significant differences in service delivery between public and private providers.
To find the exact cost of primary care services for COVID-19, HFA collected costing data on human resources for health, inventory, and visits. They then spoke with 48 public and private providers to calculate the total costs related to treating one COVID-19 patient.
HFA found that private facilities are using significantly less resources than public facilities for COVID-19 treatment because they often only provide screening for mild cases, whereas public facilities receive referrals to public hospitals and worse cases that require reactionary treatment. This means that allocating more money to screenings at public facilities could reduce public hospital burdens and costs. This finding could also expose a discrepancy in what public and private providers consider a severe case, consequently leading to over-spending at public facilities and differences in treatment when seeking care at public versus private providers. HFA’s study suggests that a standard for mild, moderate, and severe COVID-19 cases should be set among all providers to make reimbursement less varied and smoother.
Utilization and Portrait of COVID-19 Care in Secondary Health Facilities: Evidence from National Survey, 2020
Ryan R. Nugraha and Ruli Endepe
COVID-19 has put stress on each level of the Indonesian health system. As the disease changes and new variants present themselves, hospitals must continue to adapt to waves of patients and their symptoms to provide the best care possible. This change is rapid and requires a rolling analysis of best practices in order to have a full view of the finances involved. The HFA team conducted a study of 814 patients experiencing mild to severe cases of COVID-19 and what kind of care they required to give MOH a holistic view of standard practices. Here is a snapshot of what they found:
The use of the antiviral medication Oseltamivir for moderate cases was disproportionately higher than other studied medications which created supply issues. Ultimately, the researchers suggested that, while variations in care are warranted, the MOH should create clinical pathways to formalize treatment standards and eventually payment methods. A standard care package that includes an array of resources like medications will both give providers treatment options to tailor to each patient and provide a flat reimbursement rate for each case, making it easier for providers to file costs with MOH.
Estimation of Actual COVID-19 Health Care Cost in Hospital
To round out the background knowledge of COVID-19 treatment and coverage under JKN, HFA estimated the actual cost of COVID-19 treatment and presented it at InaHEA. Having a tangible number gives health economists and policymakers in Indonesia a vision for the financial future of JKN, especially in crises like COVID-19. Here’s what the team found:
Based on a study of cost drivers including length of stay, case severity level, treatment procedures, and past cost references, the findings of this study were used to produce a cost to charge ratio. This estimate eventually informed the per capita tariff (or charge) for COVID-19 treatment. With a clear picture of what it costs to treat the disease, MOH can build budgets with the proper capacity for treatment in the future.