China - Integrated Regional Health Development Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No. 18132-CHA IMPLEMENTATION COMPLETION REPORT INTEGRATED REGIONAL HEALTH DEVELOPMENT PROJECT (CREDIT 2009-CHA) Juine 30, 1998 Health, Nutrition and Population Sector Unit East Asia and Pacific Regional Office This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS Currency Unit = Renminbi (RMB) At the time of appraisal: US$1 = RMB 3.71 At the time of project completion mission: US$1 = RMB 8.27 FISCAL YEAR January 1 - December 31 WEIGHTS AND MEASURES Metric System ABBREVIATIONS AND ACRONYMS AIDS - Acquired Immunodeficiency Syndrome ARI - Acute Respiratory Infection DRG - Diagnosis Related Group DSP - Disease Surveillance Point EPI - Expanded Program on Immunization EPS - Epidemic Prevention Station FLO - Foreign Loan Office HIV - Human Immunodeficiency Virus ICB - International Competitive Bidding ICR - Implementation Completion Report IDA - International Development Association IDD - Iodine Deficiency Disorders IFC - International Finance Corporation IMR - Infant Mortality Rate MCH - Maternal and Child Health MMR - Maternal Mortality Rate MOF - Ministry of Finance MOH - Ministry of Health MTR - Mid-term Review NCD - Non-Communicable Disease PHC - Primary Health Care RHP - Regional Health Planning SAR - Staff Appraisal Report SDPC - State Development and Planning Commission of China SDR - Special Drawing Right SOE - State Owned Enterprise STD - Sexually Transmitted Disease UNDP - United Nations Development Program Vice President : Jean-Michel Severino. EAPVP Sector Manager : Maureen Law, EASHN Country Director : Yukon Huang, EACCQ Task Manager : Janet Hohnen, EASHN  FOR OFFICIAL USE ONLY IMPLEMENTATION COMPLETION REPORT CHINA INTEGRATED REGIONAL HEALTH DEVELOPMENT PROJECT C]REDIT 2009-CHA CONTENTS PREFACE ...................................................i EVALUATION SUMMARY .................................................. ii PART I: PROJECT IMPLEMENTATION ASSESSMENT ................................................... 1 A. Project Objectives and Description ...................................................I B. Achievement of Project Objectives ...................................................2 C. Implementation Record and Major Factors Affecting the Project ...........................................3 D. Project Sustainability .................. .5 E. Bank Performance ........................... .6 F. Borrower Performance ............................6 G. Assessment of Outcome ..........................7 H. Future Operation ..........................7 1. Key Lessons Leamed ..........................8 PART II: STATISTICAL TABLES ......................... 10 Table 1: Summary of Assessments .10 Table 2: Related Bank Loans/Credits. I I Table 3: Project Timetable .13 Table 4: Credit Disbursement: Cumulative Estimate and Actual .13 Table 5a: Studies Included in the Project .14 Table 5b: Guidelines and Manuals Included in the Project .15 Table 6a: Project Costs (US$ million) .17 Table 6b: Project Costs (RMB million) .17 Table 6c: Project Financing .......... , 17 Table 7: Status of Legal Covenants .18 Table 8: Compliance with Operational Manual Statements .18 Table 9: Bank Resources: Staff Inputs .19 Table 10: Bank Resources: Missions .20 ANNEX A: BORROWER'S CONTRIBUTION TO THE ICR ANNEX B: ICR MISSION'S AIDE MEMOIRE ANNEX C: SUMMARY OF PROJ1ECT COMPLETION WORKSHOP Map No. IBRD 29542 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  IMPLEMENTATION COMPLETION REPORT CHINA INTEGRATED REGIONAL IHEALTH DEVELOPMENT PROJECT CREDIT 2009-CHA PREFACE This is the Implementation Completion Report (ICR) for the Integrated Regional Health Development Project in China, for which Credit 2009-CHA in the amount of SDR 39.4 million (US$52 million equivalent) was approved on September 14, 1989 and made effective on January 19, 1990. The credit was closed on December 31, 1997. It was fully disbursed; the last disbursement took place on June 5, 1998. The ICR was prepared by Janet Hohnen (Task Manager) in the Population, Health and Nutrition Sector Unit of the East Asia and Pacific Region, based on a draft prepared by consultant David Dunlop. It was reviewed by Maria Macdonald (Principal Population Specialist) on behalf of Maureen Law, Sector Manager EASHN, and by Yukon Huang, Country Director, China. The Borrower's contribution is inc]uded as Annex A. to the report. Preparation of this ICR was initiated during discussions between the Bank and the Ministry of Health in December 1996. A Project Completion Workshop was held in Beijing in April 1998; a summary of the workshop is in Annex C. The ICR is based on materials in the project file, including extensive summary and analysis prepared by the Borrower and the project teams, and comments by members of Bank task teams.  ii IMPLEMENTATI0N COMPLETION REPORT CHINA INTEGRATED REGIONAL HEALTH DEVELOPMENT PROJECT CREDIT 2009-CHA EVALUATION SUMMARY Introduction 1. The Integrated Regional Health Development Project was the World Bank's third health sector project in China. It was identified and prepared at a time of increasing awareness of changes in the disease pattern and age structure of China's population. During this period of very rapid economic growth, investment in health facilities and technology was rising rapidly in an uncontrolled manner and at the same time funding of essential public health and rural services was declining. There were coexistent wastage and shortage of health resources and growing disparities in access to services and in health status. The Bank's sector study, China: Long Term Issues and Options in the Health Transition (1992), provided compelling evidence and analysis of these trends which became the rationale for this project and greatly influenced the project design and the strong support for the project at all levels of government. 2. The project was identified in May 1986 and approved by the Board on May 2, 1989. The credit of US$52 million equivalent becarne effective on January 19, 1990. It was supplemented by a technical assistance grant of US$700,000 from the United Nations Development Program (UNDP). Project Objectives 3. The main objective of the project was to experiment with new ways to improve capability for planning and delivery of health services by establishing three health regions, each comprising a medium sized city and its associated suburban and rural areas. The project would assist the Government by establishing policy criteria and systems for financing investment in the regions and associated investment in the provincial capitals. 4. To accomplish this broad objective, the project included nine components for the regional and provincial levels: (a) health planning, management and reform; (b) disease prevention and surveillance; (c) health education; (d) maternal and child health services; (e) emergency services; (f) hospital services; (g) rehabilitation services; (h) medical education and training; and (i) equipment management and maintenance. The national level component would strengthen  iii institutional capacity of the Ministry of Health (MOH) in project management and technical support and assist national policy development. Implementation and Results 5. The central project objective of testing a new approach and new methods for health planning and resource allocation was achieved beyond expectations. Not only has regional health planning (RHP) been successfully implemented and institutionalized in the three project areas, but the experience has been widely disseminated to other cities and provinces in China and RHP has been adopted by the State Development and Planning Commission and the State Council as a key strategy for health sector development. RHP has also become the mandatory basis for urban health finance reform. The project also made highly satisfactory progress on many technical and programmatic initiatives in the components for specific health services. 6. After a slow start in project implementation related to delayed compliance with financing agreements, fluctuating economic conditions, constraints on the funding of central level activities and lack of experience with Bank requirements and procedures, implementation was fully satisfactory in all components and all project areas. Legal covenants were all met and the credit was fully disbursed. Major factors in this successful implementation were the limited geographic scope of the project, clear policy guidelines for each component, stability of project leadership from identification to project closing, continuous active engagement of government leaders, regularity and continuity of Bank supervision, and the effective strategy of policy development adopted by MOH on the basis of the project's results. 7. The process of annual progress review and approval of plans and budgets allowed flexibility to adjust project activities according to experience. A two year extension of the project period consolidated the project's achievements, increased the sustainability of project impact and greatly assisted the successful adoption of RHP as a national health strategy. Summary of Findings, Future Operations and Key Lessons Learned 8. With wide dissemination of RHP and its inclusion as a strategy of national health policy, the impact of the central experiment of the project is highly likely to be sustained. The RHP structure and systems introduced in the three project regions have been fully incorporated into the health bureaus, and project provinces have made commitments to continue the full range of activities initiated under the project. The main challenge for full realization of RHP is to include health facilities operated by state owned enterprises and the growing private sector in the planning process. The main risk to sustainability will be availability of recurrent funding for essential public health functions and to ensure access for the poor. With the growing capacity to use local information to monitor health expenditures and recent policies protecting the share of government budgets allocated to health, prospects in this regard are hopeful, but not certain. 9. The project has influenced the design of subsequent health sector projects in China, particularly the Basic Health Services Project (Health VIII), which adapted the RHP approach for  iv poor rural counties, and will incorporate clear policy guidelines, a strong monitoring framework and the annual review and planning mechanism for adjusting project implementation. 10. The project is an early and successful example of a lending operation with the central objective of assisting health sector reform. Such operations have since become an important element of the Bank's health sector strategy. This project experience is therefore relevant for other countries pursuing health sector reform. From this project the following lessons were learned: Project Design (a) Successful project design depends on adequate sector analysis. In this project, timely presentation of relevant, high quality sector work persuaded key government officials of the importance and feasibility of the project's basic concept and strategy. (b) Complex, experimental projects can be successfully implemented in a limited geographic area, given sufficient allocation to engage and build capacity for higher level technical and management support. This is an alternative scenario to projects with a narrow content focus but wide geogyraphic coverage. (c) It is feasible, with good design, leadership mobilization and local ownership, to use a project to drive policy reform. This is an alternative scenario to the stress on adequate policy environment as a pre-requisite for project success. In an uncertain or evolving policy environment, project investments can provide a strong incentive for important reform decisions which would otherwise be very difficult. Project Management and Implementation (d) Flexibility in resource allocation and activity scheduling, associated with clear policy guidelines and a rigorous annual review, are key strategies for successful sector improvement projects, and contribute to sustainable management capacity. (e) Continuity of personnel allows for greater management flexibility as parties increase trust in each others' capacity. (f) Dialogue should begin early concerning continuity and sustainability issues, so that annual plans can be adjusted to maximize chances of long term impact. (g) The Bank's role in supervision should change with growing borrower experience and capacity, moving from hands-on, detailed demonstration of supervision to back up and support to the borrower, and assistance with dialogue on policy and sustainability; but supervision frequency should not be reduced.  v (h) Decentralization of the special account facility, financial information and other progress data in the project areas can streamline both implementation and monitoring and build management capacity. (i) The need for an extension of the project implementation period, where development objectives remain valid, should not be interpreted as a deficiency of either project design or implementation. It is an opportunity for consolidation of achievement and dissemination of experience. In this project, the two year extension was a critical factor in the policy impact as well as technical progress. Health Development (j) The Government's high level commitment to health policy reform and its attention to the project experience enabled the project to contribute to national policy and strategy for decentralizing health planning and improving resource allocation. (k) To contribute successfully to policy development, all levels of government should have a stake in the process of testing and analyzing the results of project initiatives. Involvement of influential professional groups assists this process, providing an alternative and supplement to Govermment for discussion and dissemination of project results and policy implications.  CHINA INTEGRATED REGIONAL HEALTH DEVELOPMENT PROJECT CREDIT 2009-CHA PART I: PROJECT IMPLEMENTATION ASSESSMENT A. PROJECT OBJECTIVES AND DESCRIPTION 1. The objective of the project was to experiment with new ways to improve the capability for planning and delivery of health services for a defined population by establishing three health regions (one in each of three provinces), each comprising a medium sized city and its associated suburban and rural areas. The project would assist the Government by establishing policy criteria and systems for financing investments in the regions and supporting investment in the provincial capitals. 2. To accomplish this broad objective, the project included nine components for the regional and provincial levels: (a) health planning, management and reform; (b) disease prevention and surveillance; (c) health education; (d) maternal and child health (MCH) services; (e) emergency services; (f) hospital services; (g) rehabilitation services; (h) medical education and training; and (i) equipment management and maintenance. Each component was designed to test ways of improving service delivery and management at the regional level and below; most components included supporting activities at provincial level (see Tables 6a and 6b for the project budget and costs by component). There was a national level component to strengthen the capacity of MOH to guide, assess and disseminate the project experience and to address related national policy issues. The project would provide experience to MOH and the provinces in using policy guidance, rather than direct budgetary control, to influence health sector development at regional level. 3. The three regions selected were Jinhua in Zhejiang Province, Baoji in Shaanxi Province and Jiujiang in Jiangxi Province. The regions were of comparable population size (3-4 million) but with different levels and patterns of economic activity. They were representative of over 200 medium sized cities or prefectures in which a large proportion of China's population live. The region, so defined, comes under the jurisdiction of one local government, with the advantages of being small enough to understand and monitor the full range of health and program problems while large enough to make meaningful adjustments in resource allocation. The administrative linkage of rural hinterland with urban resources also made it feasible to address the rural-urban imbalance in access and service quality. Thus, if found to be effective, a "regional" health development strategy might provide a springboard for achieving in a single program many of the national government's policy objectives. During project preparation a health plan was agreed for each region and a policy guideline was prepared for each component. Project investments were designed to assist the regions to implement their overall plans, in accordance with the guidelines,  2 through an annual review and planning exercise, which involved the use of a detailed set of monitoring indicators. B. ACHIEVEMENT OF PROJECT OBJECTIVES 4. The main project objective of testing a new approach and new tools for health planning and resource allocation was achieved beyond expectations. Not only has regional health planning (RHP) been successfully implemented and institutionalized in the three project areas, but the experience has been widely disseminated to other cities and provinces and RHP has been adopted as national policy by the State Development and Planning Commission (SDPC) and the State Council. 5. The project also made good progress on technical and programmatic initiatives in the other specific components, in which the regions and MOH introduced and tested a large range of new ideas and conducted small studies. Many of these initiatives were successful within the project period. Others were not, especially those beginning from a low level of capacity or awareness, or in unfavorable financial circumstances; however, valuable lessons were learned from this experience. Overall each component met its objectives with respect to rationalizing and upgrading of physical facilities, human resource development, improved networking and efficiency of urban services and enhanced linkages between levels for supervision and referral. Annex A provides the Borrower's summary of achievements under each component and Tables Sa and 5b list the main studies undertaken and the guidelines and manuals produced under each component. 6. Highlights of achievements in each component include: Component A: Full demonstration of the value, feasibility and procedures of regional planning for health resource allocation; establishment of an information management and processing capability to support local decision making and monitoring of progress. Control of expansion of high level health facilities. Pioneered regular total health expenditure surveys. Component B: A strengthened, integrated approach to disease control, with enhanced surveillance and analytic capability, incorporating both infectious and non-communicable disease (NCD). Renewed focus and funding for infectious disease control programs. Component C: Improved professional capacity in health education; a planning process to link health education to the key health problems and control initiatives; conduct of a large intervention study in smoking prevention in school students which was presented at the 1997 World Conference on Tobacco and Health. Component D: Capability to survey and monitor maternal and child health in the region. Demonstrated reductions in infant and maternal deaths, increased prenatal care and  3 institutional delivery, and improvements in quality of care and health worker skills with emphasis on rural counties. Component E: Set up pre-hospital and hospital emergency service networks. Upgraded blood transfusion services. Component F: Controlled expansion in urban hospital beds, through relocation and amalgamation of facilities. Controlled purchase and operation of high level equipment with improved access through hospital networks. Upgraded rural township and county hospitals. Enhanced national capability in hospital design and construction. Upgraded hospital management capacity; reduced hospital infection rates; expanded hospital roles into community outreach, home care and prevention. Component G: Introduced modem concepts of physical rehabilitation and established rehabilitation units staffed by qujalified professionals as a part of hospital services. Piloted community based rehabilitation. Broadened access to services and support for the mentally ill and their families. Component H: Upgraded health training facilities. Accelerated curriculum reform, with wider choice of subjects; introcluced community placements and flexible learning programs. Commenced general practitioner training. Component I: Established professional capacity and networks for procurement, evaluation, management, repair and maintenance of hospital equipment. C. IMPLEMENTATION RECORI) AND MAJOR FACTORS AFFECTING THE PROJECT 7. All project components were ful].y implemented in all project areas. The pace and success of implementation varied among regions and components, but overall the expectations of all parties were met and in many areas were exceeded. This successful implementation can be attributed to the foresight and courage of MOH, provincial and regional officials in undertaking the project; the clear guidelines prepared for each component; capable and continuous support of the project areas by the higher levels; and timely identification and addressing of problems. The main factors affecting implementation are discussed below. 8. Changes in the Economic Environment. The project's start coincided with a two year period of relatively low economic growth in China, in 1989 and 1990, when real GDP/capita grew at about 2.5% rather than about 10