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Goal 6: quality

Lessons from cost recovery in health

Can user fees improve the quality of health care in developing countries?

Authors: A. Creese; J. Kutzin
Publisher: World Health Organization , 1995

This World Health Organization (WHO) discussion paper describes the implementation of cost recovery (user fees) for health in developing countries and examines the effects on revenues, efficiency and quality. It reports that there can be a sharp trade-off between raising money and achieving more equitable access, unless several accompanying organisational and managerial changes are put in place. However, small amounts of money at local level can make an important contribution to service availability. The achievements of cost recovery in raising revenues are modest in most poor countries, and the problems and costs in converting extra revenue into service improvements are substantial.

The paper concludes by listing conditions for fee systems to make a positive contribution to the goals of health sector reform. It argues that some or all of the fee revenues need to be retained at the facility which collects them, and that fee levels should be periodically adjusted. The managerial and institutional capacity must also exist to use the retained revenues to promptly improve the quality of care in a way that is perceptible to the local population. Local institutions such as banks are also needed, so that revenues can be invested and are not lost to inflation.