Overview

Indonesian health financing system has changed after the country moved to a single payer health insurance system since 2014.The country has merged the previously five (5) central and fragmented health insurance schemes into one scheme, known as Jaminan Kesehatan Nasional, JKN. A single health insurance carrier, namely BPJS Health, was established to operate the scheme from 2014 onwards. JKN covers nearly 220 million Indonesians, making the largest single payer scheme in the world.

The Government of Indonesia (GOI) has achieved remarkable progress in building architectures of the strategic purchasing within JKN. The GOI, for instance, has rationalized disparate benefits packages previously existed across insurance schemes, and introduced a standardized benefits package to improve equity and access. Furthermore, the GOI introduced payment models applied for primary (i.e., capitation) and secondary (DRGs) providers.

While JKN has improved health equity and service access to Indonesians, the program’s financial sustainability remains a major concern. The JKN revenue is unable to cover its expenditures. Since inception in 2014, the scheme’s expenditures have exceeded its revenues, putting its long-term financial sustainability at risk. Funding gap of JKN is estimated to increase in the coming years. Policymakers should consider strategic options to balance JKN's finances to render the system more sustainable.

Unfortunately, evidence to inform policy decision making about proper health financial system is scanty. There is an urgent need for policy dialogue among key health financing stakeholders about policy options for improving JKN?s long-term sustainability. The financial consequences of policy options, for example, on quality of service, strategic purchasing, governance system, etc., need to be investigated. Empirical results derived from this exercise should be adopted as the basis for the technical support for JKN policy development process.

The above aforementioned problem calls for making JKN's revenue base more sustainable. Strengthening BPJS-K's ability to use strategic health purchasing to ensure expenditure growth aligned with the country's UHC priorities and meet population coverage and access to priority services is also required. Hence, providing a sound evidence-base for further decision policy making process with regards to JKN's financial sustainability is demanded.

The Ministry of Health, with funding supports from the USAID, made a collaboration with CHEPS and ThinkWell, to employ USAID Health Financing Activity (HFA). Part of the HFA Activity is to perform "JKN Financial Modeling (JFM) and Policy Development Support (PDS)".