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2.2 GLOBAL PRACTICE IN STRATEGIC

PURCHASING FOR CHRONIC DISEASE
PREVENTION AND MANAGEMENT FROM
THE PRIVATE SECTOR

With greater investments in healthcare, policy makers in countries of different income levels
have become interested in how the role of strategic purchasing could help achieve UHC
while maximising population health (WHO, 2019b). Rather than reforming the entire
foundation of healthcare financing system, strategic purchasing practices seek to optimise
existing health system capacity and enable long-term sustainability. Health ministries that
engage in strategic purchasing have been shown to not only yield more cost-effective and
efficient allocation of healthcare resources, but have also improved their accountability and
created more incentives within their healthcare system (Xu et al, 2015).

As reviewed in Chapter 1, the growing burden of chronic disease can be reduced with
greater access to affordable and quality primary care services, including screening,
treatment, and chronic disease management services (IADB, 2011). Purchasing primary care
services from the private sector has become a common strategy to expand and improve
upon the prevention and management of chronic diseases. There is a question of how and to
what extent the concept of strategic purchasing is adapted into those purchasing practices.
Purchasing policies and initiatives for chronic disease prevention and management vary
worldwide depending on contextual factors, including the structure of the health system, total
disease burden, and overall level of social and economic development. In order to better
understand the most adept strategic purchasing practices for the Hong Kong health system
context, we conducted a comparative international review to assess best practices.

This section focuses on PPPs, specifically referring to purchasing private services, for
chronic disease prevention and management in eight jurisdictions across the three types of
financing systems–namely tax-based systems, social health insurance systems, and private
health insurance systems. The health financing systems which consist of almost equal
sizes of public and private financing expenditure, similar to Hong Kong where a
substantial private sector runs parallel with the public sector, were further categorised as
public-private mixed health financing system and reviewed separately in
our study. The selected jurisdictions were from both the Asian continent as well as OECD
member countries for each health financing type to enrich the review. We reviewed how
each jurisdiction uses strategic purchasing to improve PHC investments and thus work
towards UHC.

This section is organised into two parts. The first part describes the characteristics of each
health financing type, their advantages in achieving UHC, as well as challenges where
strategic purchasing may play a role. The second part presents detailed strategic
purchasing programmes in each jurisdiction, followed by an evaluation of
their effects using a strategic purchasing framework.

2.2.1 HEALTHCARE FINANCING SYSTEMS:
NO ONE-SIZE-FITS-ALL

Healthcare financing systems comprise two fundamental components: financing
schemes, such as social health insurance, taxation, or private health insurance, and
institutional units to administrate the schemes, including social security agencies,
private insurance companies, and other financing agencies (OECD et al., 2017). Globally, the
types of financing schemes differ and are continually evolving in accordance with the ever-
changing health, economic, social, and political landscapes.

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