Health financing

Purchasing and provider payment systems

Purchasing refers to the arrangements in place, and mechanisms used, to allocate pooled funds to health service providers. Providers use these funds to deliver defined benefits to the population. Purchasing is a core function of any health system.

Moving from passive to strategic purchasing is the focus of health financing reforms in many countries. Reforms aim to address the following questions. Who purchases health services? Which services are purchased? How are services purchased? From which providers are services purchased? Purchasing can have a major impact on health system performance, in particular the efficiency and quality of services, and reducing inequities in service use.

Purchasing and provider payment systems in more detail

Moving from passive to strategic purchasing

Improving the strategic purchasing of health services is central to improving health system performance and progressing towards universal health coverage (UHC).

Key questions to ask about purchasing

Four main questions need to be addressed on the issue of purchasing.

Provider payment mechanisms

The way that health purchasers pay health care providers to deliver services is a critical element of strategic purchasing. Each payment system is based on one or more provider payment methods or mechanisms.

Global meeting

Strategic purchasing for UHC: Unlocking the potential

25-27 April 2017 – The WHO Health Governance and Financing Department convened a three day global meeting on strategic purchasing to discuss priorities and opportunities for enhancing strategic purchasing in Geneva, Switzerland.

Assessment guide for strategic purchasing

A collective learning project with inputs from WHO led to the development of an assessment guide for strategic purchasing. The guide provides key questions to guide the analysis for the following areas: benefits operationalization, provider payment methods, information management system and governance arrangements for strategic purchasing. Teams in Burkina Faso, Colombia, Karnataka (India) and the Philippines applied the guide and undertook a detailed assessment of their strategic purchasing situation in their countries.