Richard M. Scheffler, PhD Distinguished Professor of Health Economics & Public PolicyDirector, Global Center for Health Economics & Policy ResearchSchool of Public HealthUniversity of California, Berkeley

Health Workforce Allocation & Distribution

The Rural-Urban Imbalance and Public Private Mix

Health Worker Labor Market(A) (B)

Supply of Training Slots•Cost of Training•Number of Slots•Types of Training

Supply of Training Slots•Cost of Training•Number of Slots•Types of Training

Demand for HW:•Demand for Health Care

•Wages offered•Regulation

Demand for HW:•Demand for Health Care

•Wages offered•Regulation

Demand for Training Slots:•Number of Applicants

•Cost of Tuition•Expected Wages

Demand for Training Slots:•Number of Applicants

•Cost of Tuition•Expected Wages

Supply of Health Workers:•Number of graduates

•Net migration•Deaths and retirements

Supply of Health Workers:•Number of graduates

•Net migration•Deaths and retirements

Supply of HW:•Wages

•Personal Preferences

Supply of HW:•Wages

•Personal Preferences

HW Labor Market:•Wages

•# of Health Workers •Specialty

•Geographic area

HW Labor Market:•Wages

•# of Health Workers •Specialty

•Geographic area

(C)

(E)

(F)

(D)

PerformancePerformanceProductivityProductivity

(G) (H)

Demand and Supply of Nurses

Private market for health workers

Public Market for Health Workers

Urban Health Worker Labor Market

Rural Health Worker Labor Market

Task-Shifting of Community Health Workers (CHW)

Productivity Function of a Health Worker

Hours of a Health Worker

Visits

A B

CD

FE

0 Hours of a Health Worker

Visits

A B

CD

FE

0

Measuring the Distribution Problem

Density of health workers

-rural urban gap

-ratio of densities

-benchmark

-Lorenz curves and concentration indexes

Higher densities of health workers in urban areas

Using benchmark: No shortage in urban areas

Comparing Densities

Guinea

Mauritania

Chad

Mali

DRC

Ethiopia

Mozambique

Sudan

Uganda

Senegal

Niger

Rwanda

Kenya

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

0 0.5 1 1.5 2 2.5

Num

ber o

f doc

tors

for

10,

000

pers

ons

(URB

AN

are

as)

Number of doctors for 10,000 persons (RURAL areas)

Densities of doctors across urban and rural areasin 13 countries

Distribution of health workers per capita by cadre in all districts of Tanzania

Source: Munga and Maestad 2009.

Measuring inequities in HRH

0.000

0.100

0.200

0.300

0.400

0.500

0.600

Co

nce

ntr

atio

n in

dex

es

Doctors

Nurses

Why the Rural-Urban Imbalance?

Demand factors Employment opportunities Funding

Supply factors Preferences Cost of living

A rural and an urban market

supplydemand

labor

compensation

CompU

Urban HRH market

supply

demand

Rural HRH market

labor

compensation

CompRU

unemployment shortage

Urban employment and rural shortage situation

Supply2demand

labor

compensation

CompURBAN

Urban HRH market

Supply1

demand

Rural HRH market

labor

compensation

CompRURAL

New level of unemployment New level of shortage

Supply1New suppl

Urban and Rural HRH Markets with Improved Information

labor

Supply1

demand

Rural HRH market

labor

compensation

CompRURAL

New level of shortage

Supply1

What can we do to influence the rural HRH labor market?

labor

Supply1

demand

Rural HRH market

labor

compensation

CompRURAL

New level of shortage

Supply1

Demand Interventions

Pay more CompRURAL

labor

Supply1

demand

Rural HRH market

labor

compensation

CompRURAL

New level of shortage

Supply1

Demand interventions

Pay more, Increase Financing

CompRURAL

Public vs Private Sector

Salary payment come from very different sources Private sector is not subject to some regulations

Licensing Easier to hire and fire Payment and incentives are

more flexible This leads to

Different labor demand Another health worker decision (supply)

22

23

Total Health Spending by Financing Source

0%

20%

40%

60%

80%

100%

Low-incomecountries

Lower middle-income

countries

Upper middle-income

countries

High-incomecountries

Per

cen

t o

f T

ota

l Hea

lth

S

pen

din

g

Public Out-of-pocket Other Private

In LICs 76% of all health spending is private and 70% is out of pocket

Source: World Bank, WHO, 2007.

How Big is the Private Sector?

24

25

Bangladesh Cameroon Ethiopia Honduras India Indonesia Papau New Guinea

Peru Tajikistan Uganda

Absemteesm Rates

Ban it and try to enforce through better monitoring India, Venezuela

Increase pay (straight allowance or salary)Increase pay but based on performance

Rwanda, TurkeyContract for specific hours

Dominican Republic 20 hour contractCompletely reform system

Do not employ health workers – make them all private practitioners

Policy Options – Dual Practice

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