A simple simulation model as a tool to assess alternative health care provider payment reform options in Vietnam

Abstract

Vietnam is currently considering a revision of its 2008 Health Insurance Law, including the regulation of provider payment methods. This study uses a simple spreadsheet-based, micro-simulation model to analyse the potential impacts of different provider payment reform scenarios on resource allocation across health care providers in three provinces in Vietnam, as well as on the total expenditure of the provincial branches of the public health insurance agency (Provincial Social Security [PSS]). The results show that currently more than 50% of PSS spending is concentrated at the provincial level with less than half at the district level. There is also a high degree of financial risk on district hospitals with the current fund-holding arrangement. Results of the simulation model show that several alternative scenarios for provider payment reform could improve the current payment system by reducing the high financial risk currently borne by district hospitals without dramatically shifting the current level and distribution of PSS expenditure. The results of the simulation analysis provided an empirical basis for health policy-makers in Vietnam to assess different provider payment reform options and make decisions about new models to support health system objectives.

Keywords:

• health financing
• universal coverage
• provider payment
• simulation analysis

Acknowledgements

The authors would like to acknowledge the role of the Ministry of Health of Vietnam and Vietnam Social Security in commissioning this study, and provincial health authorities for generously sharing their views and their time. Valuable input was contributed by three anonymous reviewers.

Funding

Funding for the study was provided by the Rockefeller Foundation [grant number 2011 THS 324] through the Joint Learning Network for Universal Health Coverage Provider Payment Initiative.

Supplemental data

Supplemental data for this article can be accessed here.

Notes

1. The payment system is actually modified FFS with a cap. The payment system is referred to as ‘capitation’ in Vietnam although the payment system does not meet international definitions for capitation (Phuong et al., 2015).

2. The insured population groups are (1) civil servants and formal sector employees; (2) pensioners, veterans and recipients of social assistance; (3) poor and near poor; (4) children under the age of 6 years; school children and students; other (mainly voluntary enrolees).

3 VSS reimburses over-runs by district hospitals up to the ceiling of 90% of the premium revenue for insured individuals registered at that hospital. Since district hospital capitation funds are calculated to be close to this ceiling, it is often difficult for district hospitals to get compensated for over-runs unless they go through lengthy procedures to get an exception (Tran et al., 2011).

Additional information

Funding

Funding for the study was provided by the Rockefeller Foundation [grant number 2011 THS 324] through the Joint Learning Network for Universal Health Coverage Provider Payment Initiative.