reports

Allocating funds for healthcare in Manitoba regional health authorities: a first step – population-based funding

Winnipeg, MB, Canada: Manitoba Centre for Health Policy.

Manitoba Centre for Health Policy, Dept. of Community Health Sciences, Faculty of Medicine, University of Manitoba, Winnipeg, MB, Canada

If there were no disparities in health status between the populations living in Manitoba Regional Health Authorities (RHAs), a simple per capita distribution of healthcare funds would be appropriate; that is, a certain number of dollars would be assigned to each person and regional funding would be calculated simply on the basis of the number of people living in the region. We could even adjust the funding allocation between regional populations to take into account demographic differences that are known to affect health service utilization such as age and male/female distribution. However, this assumes that the people living in every region have equal need for health services, and that funding is only a function of population size and the age-sex makeup of that population. Yet we know that even after controlling for age and sex, the people living in some regions are less healthy than those living in others (Brownell et al., 2003; Fransoo et al., 2005; Martens et al., 2003; Roos et al., 2001)—hence the need to move beyond basing health service funding simply on age, sex and population size. This report describes a first step in an overall funding allocation methodology for Manitoba Regional Health Authorities. It shows a proportional allocation of funds among RHAs that reflects important characteristics of the population living in each RHA. This funding is for selected health services. These services are: inpatient hospital care and day surgery, personal care homes, and home care. The second (and final) step necessary to establish overall funding for RHAs includes two components: allocating funds for population-based services that are not included in this report (community and mental health services, emergency response and transportation, and hospital-basedambulatory care including outpatient clinics and emergency departments); and allocating funds for non-population-based services—those services that are located in regions but are funded on a geographic or policy basis. Manitoba Health asked the Manitoba Centre for Health Policy to consider how funds for healthcare would be allocated to Manitoba Regional Health Authorities if the characteristics that are expected to influence need for health services were taken into account. The specific objectives of the project were:

1. To initiate a process that would involve key decision-makers in developing the funding allocation methodology
2. To develop a methodology that would describe the proportion of funds that would be allocated to each Regional Health Authority for inpatient hospital and day surgery care, personal care homes, and home care, if the characteristics of the population were taken into account
3. To describe some of the implementation issues that would need to be considered if the methodology is adopted

There are two key messages in this report—we can describe how funds would be allocated on a proportional basis, but not how many dollars should be allocated to each region, and, in Manitoba, population-based funding allocation is only one component of the overall funding allocation process.