Financing Reform Aims to Improve Quality of Health Services

FRIDAY, JANUARY 16, 2009 (Addis Ababa) – Today the United States Agency for International Development (USAID), in collaboration with the Ministry of Health and Abt Associates, Inc., launched the Ethiopia Health Sector Financing Reform Project.  The U.S. $15 million dollar project, which focuses on health care financing reform and health insurance, will improve the lives of over 40 million Ethiopians in the next five years by improving quality of health services, increasing access to health care and improving the utilization of modern health care.

The project builds on the successful USAID-supported health financing reform of the Federal Ministry of Health and Regional Health Bureaus, and will support a national health insurance initiative and implement health sector financing reforms at the regional level.  This new, five-year Health Sector Financing Reform Project was designed jointly by the FMoH and USAID, and funding for the project is provided by the American people through USAID and the U.S. President’s Emergency Plan for AIDS Relief (PEPFAR). The project will be implemented throughout the country in phases.

State Minister of Health Dr. Kebede Worku, and USAID/Ethiopia Mission Director Glenn Anders, delivered remarks at the launch at the Global Hotel.  In his remarks, Anders said, “USAID is proud to support these Ethiopian Ministry of Health-initiated health insurance schemes that promote alternative arrangements for financing, allocating, organizing and managing health resources and services including cost sharing and increasing the role of the private sector.” 

USAID and Abt Associates have a long history of supporting health financing reform initiatives in Ethiopia that have resulted in improved quality of health delivery through decentralized budgeting and financial management systems and effective use of health resources at the health facility level.  PEPFAR, through USAID, is committed to long-term support for the Health Sector Finance Reform program, because the program also addresses and builds incentives to support quality delivery of HIV/AIDS-related services throughout Ethiopia.

During the decade-long process of health reform, Ethiopia has moved into rational and efficient health financing systems that includes user fee retention, waiver and exemption policies, hospital and health center governance, and management mechanisms. The project launched today aims to support the government’s efforts to expand and consolidate the health sector financing reform and institute social and community-based health insurance.