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Future Financial Economics of Health Professional Education: Proceedings of a Workshop (2017)

Chapter: Appendix B: Future Financing of Health Professional Education Workshop Background Document

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Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
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Appendix B

Future Financing of Health Professional Education Workshop Background Document

Erin Fraher, Warren Newton, Edson Araujo, Mary Beth Bigley, Kathleen Klink, Robert Smith, Joanne Spetz, and Zohray Talib

Rapid health system transformation is putting new demands on the health workforce. With these demands come opportunities and challenges as new roles emerge and required skill sets alter in response to changing demographics and other societal shifts, as well as the increased complexity of patient cases. All of this demands review of the different competencies needed for a sustainable, well-functioning health system. Part of the review involves matching the population needs to the right number and mix of health workers. With increased attention to the social determinants of health, the definition of what makes up a health workforce continues to expand and include such groups as community health workers, behavioral specialists, community advocates, and others outside of the traditional mainstream health sector.

Another health system change stems in part from new payment and care delivery models that emphasize team-based care for improved quality and safety. In addition, care in many countries takes place in the community or is now shifting from acute care settings to community-based clinics. These health system changes necessitate alterations in the way students are educated to more closely resemble the care settings in which they are more likely to practice. This is increasingly evident with the slowdown of economic growth transnationally and the limits in funding caused by governmental debt.

Finally, constrained resources are forcing health system leaders, employers, and governments to rethink their social and financial returns on investments for financing health professional education (HPE). The result is an ever-increasing shift of the cost burden from the public sector to the

Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
×

student. A consequence of this shift is an increase of innovative models for delivering education in less costly manners and a greater voice of the student in how education is delivered.

The following set of guiding principles builds on these financial considerations by putting forth what the authors believe is an ideal for what a well-designed HPE system would be founded on:

  • responsive to society: Investments in HPE should be responsive to population health needs. They need to create incentives that move the market toward producing more health professionals who are trained and thus work in a range of settings and geographies as dictated by the population (McPake et al., 2015).
  • transparent: “By making transparent the relative economic value of certain fields of study or the value of degrees from competing institutions” (Palacios, 2002).
  • nimble: Rapid changes in the needs of society require nimble HPE systems to respond to shifting population health needs, changing technology, and new models of care in a timely manner.
  • generate value to actors and the system: “Most educational interventions are not evaluated for their cost-effectiveness, benefit, or utility.” To date, “no standards have emerged defining high-quality cost analyses in health care professional education” (Walsh, 2013).
  • lifelong: The vast majority of a health professional’s education takes place after he or she graduates and enters the workforce. According to the UK NHS Department of Health, there is a responsibility to support workforce development so workers’ “skills and knowledge to deliver high-quality, safe care are enabled to meet the changing needs of patients and local communities, including the ability to work in new clinical settings that provide care closer to home” (Department of Health, 2008).
  • ethical: Students accrue debt for their education and graduate with no job prospects. Private, for-profit institutes are appearing.
  • interconnected: Education must communicate with those working for service reform, and vice versa.

The authors identified financing actors and their financing mechanisms, which are shown in Table B-1.

Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
×

TABLE B-1 Financing Actors and Their Financing Mechanisms

Actor Interests Financing Mechanism
Student/family/health professional Private
  • Education savings accounts, out of pocket
  • Income contingent loana
  • Human capital contractb
  • Traditional loans
Employer Private
  • Foundation or private grants and scholarships
Community Public and private
  • (Philippines example)
Industry Public and private
  • Public–private partnerships
Government/taxpayer Public
  • Government grants, scholarships, and fellowships
Health professional schools Public
  • Grants, scholarships, and fellowships

a Limits monthly loan payments to a percentage of the borrower’s income (Palacios, 2002).

b Under a human capital contract, a student receives funding from an investor in exchange for a percentage of his or her income during a fixed period of time. Human capital contracts are equity-like instruments because the investor’s return will depend on the earnings of the student, not on a predefined interest rate. The effects of these arrangements are, among others, less risk for the student, transfer of risk to a party that can manage it better, increased information regarding the economic value of education, and increased competition in the higher education market (Palacios, 2002).

SOURCE: Adapted from Palacios, 2002.

REFERENCES

Department of Health. 2008. A high quality workforce: NHS next stage review. http://webarchive.nationalarchives.gov.uk/20130107105354/http://www.dh.gov.uk/prod_consum_dh/groups/dh_digitalassets/@dh/@en/documents/digitalasset/dh_085841.pdf (accessed September 26, 2016).

McPake, B., A. Squires, A. Mahat, and E. C. Araujo. 2015. The economics of health professional education and careers: Insights from a literature review. Washington, DC: World Bank Group. http://documents.worldbank.org/curated/en/570681468190783192/The-economics-of-health-professional-education-and-careers-insights-from-a-literature-review (accessed September 26, 2016).

Palacios, M. 2002. Human capital contracts: “Equity-like” instruments for financing higher education. Policy analysis no. 492. Washington, DC: Cato Institute. http://www.cato.org/publications/policy-analysis/human-capital-contracts-equity-instruments-financing-higher-education (accessed September 26, 2016).

Walsh, K. 2013. Cost and value in healthcare professional education—why the slow pace of change? American Journal of Pharmaceutical Education 77(9):205.

Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
×

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Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
×
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Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
×
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Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
×
Page 97
Suggested Citation:"Appendix B: Future Financing of Health Professional Education Workshop Background Document." National Academies of Sciences, Engineering, and Medicine. 2017. Future Financial Economics of Health Professional Education: Proceedings of a Workshop. Washington, DC: The National Academies Press. doi: 10.17226/24736.
×
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An adequate, well-trained, and diverse health care workforce is essential for providing access to quality health care services. However, despite more than a decade of concerted global action to address the health workforce crisis, collective efforts are falling short in scaling up the supply of health workers. The resulting health workforce shortage affects people’s access to quality health care around the globe.

In October 2016, the National Academies of Sciences, Engineering, and Medicine convened a workshop to explore resources for financing health professional education in high-, middle-, and low-income countries and innovative methods for financially supporting investments in health professional education within and across professions. Participants examined opportunities for matching population health needs with the right number, mix, distribution, and skill set of health workers while considering how supply and demand drive decisions within education and health. This publication summarizes the presentations and discussions from the workshop.

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