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Health Financing System Plagued by Unpredictable Donor Funding

The health financing system in Palestine is heavily reliant on donor funding, which is neither sustainable nor predictable. This has resulted in the two main sources of public funding for healthcare - the Government Health Insurance scheme and general taxes raised by the Ministry of Finance - being fragmented and operating at a financial deficit.

The Current State of Affairs

  • Out-of-pocket expenditures account for 45.5% of total health expenditures, with many Palestinians not covered by any insurance scheme.
  • The high cost of medical referrals, which accounts for 40% of health expenditures, continues to burden the healthcare system, leading to substantial debt and regular arrears.

Impact of COVID-19

The COVID-19 pandemic has further exacerbated the crisis, putting a significant strain on the already fragile healthcare sector. The Palestinian Ministry of Health has launched a national deployment and vaccination plan to distribute COVID-19 vaccines across the West Bank and Gaza Strip, but concerns remain over access and acceptance among the population.

Reform Needed in Education Sector

The education sector is grappling with its own set of challenges. Despite an ambitious strategy aimed at integrating human rights concepts into curricula, educational governance and management remain major obstacles to achieving the sector’s goals.

Recommendations for Reform

  • The Palestinian Authority must ensure that education material complies with UNESCO standards on peace, tolerance, coexistence, and non-violence.
  • The development of curricula must also reflect the country’s commitment to promoting a culture of peace and global citizenship.

Water and Energy Sectors Face Sustainability Concerns

In the water sector, important investments have been made by the Palestinian Authority and donors, but progress has been slow in implementing reforms. Limited financial resources are hindering efforts to control losses and develop renewable energy sources.

Challenges in the Energy Sector

Similarly, the National Energy Strategy sets ambitious targets for reducing losses and promoting renewable energy, but a lack of dedicated funding is impeding progress.

Priorities Identified

In light of these challenges, six priorities have been identified to support governance reforms in key sectors:

  • Supporting nascent public administration through the Prime Minister’s Office.
  • Tackling budget and fiscal constraints through the Ministry of Finance and other relevant actors.
  • Fostering institutional capacity for implementing social protection sector policy reforms through the Ministry of Social Development.
  • Improving institutional capacity for implementing health sector policy reforms through the Ministry of Health.
  • Supporting progress in the reform process in the water sector.
  • Supporting progress in the reform process in the energy sector.

These priorities will be crucial in addressing the pressing challenges facing Palestine’s healthcare, education, and infrastructure sectors, and ensuring a more sustainable future for its people.