Health System in Mexico: Reforms, Transformation and Challenges

Abstract:

This paper analyses the health systems in Mexico in the backdrop of the Seguro Popular (SP) reform implemented in the early 2000s. The objective of this analysis is to draw lessons for health system strengthening aimed at access and equity in health services, financial protection and improved health outcomes for lower and upper middle income countries aspiring to achieve universal health coverage (UHC). The paper traces the trajectory of health system reforms, including and prior to SP, from 2003 until 2019, and analyses the contextual factors that were instrumental in the reform process.

Mexico introduced several initiatives in the decades before the SP reforms in the form of decentralization, conditional cash transfers, targeted medical interventions, leveraging the private sector, and improving primary care coverage. These contributed to improved outcomes but inequities in access to health services and outcomes persisted. Government spending on health remained low in this period and household expenditure on health was high. To the address the gaps, SP applied three key policy levers; 1) introduction of a purchaser–provider split and the creation of an autonomous decentralized agency to allocate and oversee the expenditure of funds at the provider level; 2) allowing greater participation of private providers through contracts to increase patient choice and subsequently coverage; 3) an increase in public expenditure.

SP extended coverage for both basic illness and complex procedures to the uninsured population.  The reforms led to the provision of health insurance to 43.5 percent of the total population which were previously uninsured. Out of pocket expenditure (as percent of total health expenditure) reduced from 52 percent in 2000 to 42 percent in 2018. SP reduced child mortality and increased coverage among the urban poor. Despite these achievements, gaps remain in the form of inequity in access to health services, financing, rising disease burden due to non communicable disease, and high out of pocket expenditure. This paper attempts to understand the key policy instruments that contributed to these positive shifts and the context within which they were successful.