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Box 2.2

Case study: Strategic purchasing in Thailand–
How strategic purchasing led the charge towards UHC

Thailand’s Universal Coverage Scheme (UCS) has been widely acknowledged as a successful
example of implementing strategic purchasing in a way that has significantly expanded
coverage. The UCS links a government office with contracted public practitioners to provide
services for the indigent.

Governance: The UCS is created by the government and run by the National Health
Security Office, providing coverage for 75% of the population. The Office proposes and
negotiates an annual budget based on estimated rates of service use. The Office also acts as
a purchasing power and negotiates lower prices for high-cost medicine.

Information Management Systems: Health Technology Assessments are used to
evaluate the efficacy and price-efficiency of medical interventions. It has also implemented a
24-hour call centre to receive feedback and complaints from patients.
Benefit Package Design: The UCS features a comprehensive benefit package with a
small exclusion list of services that are not covered. Inclusion of services was guided by
evidence of demand and equity in coverage between the UCS and private insurance
companies. For instance, renal replacement therapy was initially excluded due to high costs
but was later included as a result of public opinion and possible inequitable access between
UCS patients and private insurance patients who did have this therapy covered.

Mixed Provider Payment Systems: Outpatient services are paid on a capitation basis,
and inpatient services are paid for with prices based on the diagnosis related group (DRG)
within a global budget.

Managing Alignment and Dynamics: Information systems update the National Health
Security Office on reasonable use of services and scope of service needs. Providers are
incentivised with remaining budget balances but are asked to pay negative balances.

Core areas of strategic purchasing and policy questions

Policy questions Policy questions
WHAT TO BUY? FROM WHOM TO BUY?
Which services, From which providers to
interventions and buy and how to choose
medecines to these?
purchase, and
what cost-sharing Specifying Selecting
and referral bene ts providers Policy questions
arrangements are HOW TO BUY?
appropriate as What are the most
conditions of appropriate provider
access? Designing payment methods?
(non-) nancial What type of contractual
incentives obligations and other
(non-) nancial incentives
Policy questions are available to purchaser
What information to increase provider
to generate, and Managing performance?
how best to information Governance*
manage, analyse systems for strategic
and use it for purchasing Policy questions
strategic purchasing How to exert oversight over
decisions?
a purchasing agency to
ensure accountability and how
to coordinate across multiple
* Governance is an overarching health system function, purchasing agencies?
but is particularly relevant for strategic purchasing.

Note: Figure is adopted from WHO, 2019b
Sources: Patcharanarumol et al., 2018; Tangcharoensathien et al., 2014; WHO, 2019b
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