An unintended consequence of provider payment reform: The case of capitation grants in the National Health Insurance reform of Indonesia

Abstract

Summary One of the most important components of the ambitious 2014 National Health Insurance reform in Indonesia is the implementation of prospective payment system known as capitation grants, paid monthly to the primary health providers based on the enrolment rate. This has ushered in additional financial resources for the health managers in resource allocations, especially in the hiring of manpower. Drawing data from the Indonesia Family Life Survey (1993‐2015), this paper uses difference‐in‐differences method to evaluate the effects of the payment method reform on the allocation of human resources for health among the primary health providers. To our surprise, there was no statistically significant change in the total number of full‐time staff among the capitated facilities after the reform. However, capitation grants caused an increase in the number of full‐time equivalent and part‐time equivalent contract staff, but a significant decline in the number of full‐time permanent staff among the urban capitated facilities. It is likely that more contract health workers were hired at the expense of full‐time permanent staff among the capitated facilities in the urban regions. This unintended consequence shed light on the need to develop nuanced and contextual understanding of payment reforms in developing countries.

The Experiences of Strategic Purchasing of Healthcare in Nine Middle-Income Countries: A Systematic Qualitative Review

“…The introduction of capitation and gate-keeping led to a reduction in demand for hospital care. 54 The exceptions were Ghana and Iran where FFS reimbursement is used. 43 Capitation has been piloted in Ghana.…”

“… 83 , 85 This was possible through the PPJK agency (Perusahaan Pengurusan Jasa Kepabeanan-health Insurance Directorate) under the Ministry of Health (MoH) to evaluate and calculate prices, simulated with expected revenues. 54 …”

Theory-practice gap of capitation payment in the Indonesian national health insurance: toward universal health coverage

“…In several PHCs. capitation contracts with the BPJSK allow them to hire more staff temporarily, but it is still risky to hire permanent staff (Tan and Qian, 2019). In cases of PHCs with high number of enrolled members, staff motivation did increase (Rusdiana and Faisya, 2020).…”

Determinants of the National Health Insurance Uptake in Indonesia

“…JKN refers to medical services offered by the public services and licensed private providers and covered services ranging from health promotion, prevention, primary treatments to specialized and long-term treatment, including open-heart surgery, cancer treatment, and renal dialysis (Agustina et al, 2019). All citizens of Indonesia, regardless of previous health conditions or risk, must register with the SSAH to enforce JKN (Tan and Qian, 2019). Muhlis Indonesian Journal of Health Administration (Jurnal Administrasi Kesehatan Indonesia) p- ISSN 2303-3592, e-ISSN 2540-9301 10.20473/jaki.v10i1.2022 Literature Review…”