Economic Implications for Health Services and the Management of Health/ Family Planning

A session with:
Dr. James Fay
Prasena Think Tank
14 December 2002


“Managing Organization Change”
Customized AIT Training Program For the National Family Planning Coordinating Board of Indonesia
Introduction

Challenge of the Changing World
Role of Economics
.The Study of the Allocation of Scarce Resources
Economics to Help Policy Makers
.Most Beneficial Health/ Family Planning Programs
.Most Cost-Effective Health/ Family Planning Programs
Alternative Country Approaches

United States
.Maximum Privatization
Canada
.Health Care for All
Thailand
.New Experiment
Common Ingredients for Successful Health Care Service

Primary Health Care Interface
.First Contact with Patients
Family/Neighborhood Clinics
.Cost Effective Utilization of Resources
Utilization of Information Technology
.Interlinked Clinics
.Virtual Offices
.Databases
Economic Considerations for Changing Indonesia’s Health Services

Iron Rule of Economics
.Substitution of Capital for Labor
Measuring Costs
.Taken from Budget
Measuring Benefits
.Difficulties and Human Life Values
Alternative Approach
.Estimating Cost- Effectiveness
Economics and the Management of Change

Paradox of Change and Management
Need to Introduce Change Agents
One Approach: Zero-Based Budgeting
Conclusion

All Countries Facing Health Care Crisis
New Technologies Must be Employed
Economics Essential Tool for Making Right Decisions
http://aric.adb.org/statistical_sources.asp

http://www.overpopulation.com/faq/health/health_personnel/asia.html
http://aric.adb.org/statistical_sources.asp
http://aric.adb.org/statistical_sources.asp
http://www.itu.int/ITU-D/ict/papers/2001/ASEAN%20Internet.pdf
IRR - Returns the internal rate of return for a series of cash flows represented by the numbers in values. These cash flows do not have to be even, as they would be for an annuity. However, the cash flows must occur at regular intervals, such as monthly or annually. The internal rate of return is the interest rate received for an investment consisting of payments (negative values) and income (positive values) that occur at regular periods.

Syntax - IRR(values,guess)

Values is an array or a reference to cells that contain numbers for which you want to calculate the internal rate of return.
Values must contain at least one positive value and one negative value to calculate the internal rate of return.
IRR uses the order of values to interpret the order of cash flows. Be sure to enter your payment and income values in the sequence you want.
If an array or reference argument contains text, logical values, or empty cells, those values are ignored.
Guess is a number that you guess is close to the result of IRR.

Microsoft Excel uses an iterative technique for calculating IRR. Starting with guess, IRR cycles through the calculation until the result is accurate within 0.00001 percent. If IRR can't find a result that works after 20 tries, the #NUM! error value is returned.
In most cases you do not need to provide guess for the IRR calculation. If guess is omitted, it is assumed to be 0.1 (10 percent).


If IRR gives the #NUM! error value, or if the result is not close to what you expected, try again with a different value for guess.
Remarks

IRR is closely related to NPV, the net present value function. The rate of return calculated by IRR is the interest rate corresponding to a 0 (zero) net present value. The following formula demonstrates how NPV and IRR are related:

NPV(IRR(B1:B6),B1:B6) equals 3.60E-08 [Within the accuracy of the IRR calculation, the value 3.60E-08 is effectively 0 (zero).]

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