The World Bank Second Serbia Health Project (P129539) REPORT NO.: RES49081 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF SECOND SERBIA HEALTH PROJECT APPROVED ON FEBRUARY 25, 2014 TO REPUBLIC OF SERBIA HEALTH, NUTRITION & POPULATION EUROPE AND CENTRAL ASIA Regional Vice President: Anna M. Bjerde Country Director: Linda Van Gelder Regional Director: Fadia M. Saadah Practice Manager/Manager: Tania Dmytraczenko Task Team Leader(s): Ha Thi Hong Nguyen The World Bank Second Serbia Health Project (P129539) ABBREVIATIONS AND ACRONYMS AF Additional Financing LINAC Linear Accelerator MoH Ministry of Health MRI Magnetic Resonance Imaging PDO Project Development Objective The World Bank Second Serbia Health Project (P129539) BASIC DATA Product Information Project ID Financing Instrument P129539 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 25-Feb-2014 31-Dec-2022 Organizations Borrower Responsible Agency Republic of Serbia Ministry of Health Project Development Objective (PDO) Original PDO The PDO is to contribute to improving the efficiency and quality of the public health system of the Republic of Serbia through the strengthening of: (i) health financing, purchasing, and maintenance systems; and (ii) quality improvement systems and management of selected priority non-communicable diseases. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing (US$, Millions) Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IBRD-88300 20-Mar-2018 21-Mar-2018 24-Jul-2018 31-Dec-2022 31.10 11.54 18.48 IBRD-83380 25-Feb-2014 10-Jul-2014 08-May-2015 31-Dec-2022 40.00 33.73 .82 Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No The World Bank Second Serbia Health Project (P129539) I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING Background 1. The EUR 29.1 million Second Serbia Health Project was approved in February 2014 and became effective in May 2015. A EUR 25 million Additional Financing (AF) was approved in March 2018 and became effective in July 2018. The current Project Development Objective (PDO) is to contribute to improving the efficiency and quality of the public health system of the Republic of Serbia through the strengthening of: (i) health financing, purchasing, and maintenance systems; and (ii) quality improvement systems and management of selected priority non- communicable diseases. To achieve this, the Project includes four components:  Component 1: Improvement of Health Financing (EUR 9.03 million), with subcomponents being: (i) support hospital financing reforms; (ii) strengthen primary health care (PHC) financing; and (iii) develop a health care network optimization plan;  Component 2: Improve Access to Quality Health Care (EUR 6.29 million), with subcomponents being: (i) improve access to medicines; (ii) strengthening health technology assessment capacity; and (iii) improve medical equipment maintenance systems;  Component 3: Strengthening Quality of Service Delivery (EUR 34.98 million), with subcomponents being: (i) strengthen quality improvement systems; and (ii) improve cancer management; and  Component 4: Monitoring, Evaluation, and Project Management (EUR 3.68). 2. The Project has been restructured twice and has been extended for a cumulative period of 39 months from the original closing date. The first restructuring (September 2015) reallocated funds across categories because a number of activities planned under the project had been completed prior to Project effectiveness. Under the above-mentioned AF (March 2018), the Project closing date was extended by 27 months (from September 30, 2019 to December 31, 2021). The second restructuring (September 2021) extended the closing date by 12 months (from December 31, 2021 to December 31, 2022) to provide time to complete important activities that were delayed due to COVID-19 pandemic. These activities include the procurement of medical equipment and additional equipment for radiotherapy centers, finalization and adoption of the Plan for Continuous Improvement of Health Care Quality and Patient Safety, support to hospital management capacity building in health care financing reforms, development and deployment of the cancer registry information system, and implementation of activities related to medical equipment maintenance. Project Status 3. Progress towards achievement of the PDO is rated Satisfactory, overall implementation progress is rated Moderately Satisfactory, and, as of December 1, 2021, a total of EUR 38.5 million has been disbursed, representing 70% of Project loans. Despite the significant impact of COVID-19 on the health sector, several important achievements have been made in the calendar year 2021 which will help advancing Government’s reforms toward achieving better quality and efficiency. Most importantly: (i) an elaborated Health Care Institutions Network Optimization Plan through 2035 has been developed, publicly consulted, and adopted by the Government; (ii) 91 projects in 83 PHC centers supported by quality improvement grants from the Project have been completed; and (iii) the integration of clinical care pathways into PHC and hospital information systems is near finalization. With the Project’s support, the use of antibiotics in 2020 was 20 percent below the 2015 level. Waiting time for radiotherapy in the hospitals which have received equipment from the Project reduced significantly. For example, in Institute of Oncology and Radiology of Serbia, waiting time for radiotherapy for breast cancer was reduced from The World Bank Second Serbia Health Project (P129539) 50 days to 38 days between quarter 1 2018 (baseline) and quarter 4 2020. During the same period, the waiting time for lung cancer among men was cut down by a half, from 51 days to 25 days. 4. As part of the AF, three withdrawal conditions were instituted for an activity under Component 3.2 (Improve Cancer Management), namely: (i) issuing a Decree to update Serbia Against Cancer, including an action plan for its implementation; (ii) issuing a Decree to regulate the national program for the health care network optimization plan; and (ii) through the Ministry of Health (MoH), adopt a rulebook to establish a unit within the MoH responsible for the administrative and technical equipment maintenance system; all in a manner acceptable to the Bank. To-date, the government has: (i) adopted the Cancer Control Improvement Program with Action plan (July 2020); (ii) adopted the Health Care Institutions Network Optimization Plan (May 2021); and (iii) adopted the rulebook for the establishment of a Medical Equipment Maintenance Unit within the MoH (October 2019) and taken a decision regarding the unit’s roles and staffing requirements.1 Rationale for the Restructuring 5. Despite the progress on the fulfillment of the withdrawal conditions, government priorities shifted, and, in November 2021, the MoH initiated the discussion on reallocating loan proceeds originally planned for the procurement of diagnostic equipment to the procurement of therapeutic equipment. Procurement of the therapeutic linear accelerators (LINACs) have been identified as a more critical need for Project support than the originally planned procurement of the diagnostic Magnetic Resonance Imaging (MRI) machines given the updated inventory of health equipment. Linear accelerators have been supported under the Project before, yet critical gaps remain.2 The analysis of waiting times, continuously monitored under the Project, has shown that, compared to 2018 (baseline), the waiting times have been reduced after the procurement and installation of new LINACs in all five hospitals for most tumour localizations. Given the increasing number of cancer patients, additional modern equipment would contribute to the reduction of patient waiting lists, increase the availability of radiation treatment, enable the further introduction of advanced techniques into daily practice, and, above all, improve treatment outcomes and reduce treatment complications in oncology patients. 6. The proposed restructuring will enable the procurement and installation of four additional LINACs to replace existing machines that are either outdated or have stopped working. Specifically, two LINACs will be installed in in the Institute of Oncology and Radiology of Serbia, the country’s highest-level oncology center and the only institution providing radiotherapy treatment to children. The new LINACs will replace two machines that are 13 and 14 years old. One LINAC each will be installed at the University Clinical Center Niš and the University Clinical Center Kragujevac, replacing LINACs that are 14 and 17 years old, respectively, and are no longer in operation. Together with the eight LINACs previously procured and installed under the project, these new LINACs will ensure contemporary and uniform radiotherapy services throughout Serbia and fulfil the need for major investments in this important area for a number of years. II. DESCRIPTION OF PROPOSED CHANGES 1 Progress on these withdrawal conditions is documented in several mission Aide Memoirs (September 2020, April 2021 and October 2021) and ISRs (November 2021). 2 Six LINACs were procured for four hospitals (Institute for Radiology and Oncology of Serbia, University Clinical Center Niš, University Clinical Center Kragujevac and Health Center Kladovo) as part of the original loan under disbursement category 1. Two LINACs were procured for the Oncology Institute of Vojvodina as part of the AF loan under disbursement category 2. The World Bank Second Serbia Health Project (P129539) 7. Reallocation between Disbursement Categories. The proposed restructuring will reallocate funds under loan IBRD-88300 from disbursement category 3 to disbursement category 2 to accommodate a shift in Government’s priority for Project’s support from diagnostic to therapeutic medical equipment. Specifically, the project description has been revised to remove reference to diagnostic medical equipment, as they will no longer be financed by the Project. Instead, Project funds will be reallocated (from disbursement category 3 to category 2) to finance the procurement and installation of four additional LINACs (two in Institute for Oncology and Radiology of Serbia in Belgrade, one in University Clinical Center Niš and one in University Clinical Center Kragujevac). As there will no longer be funds under category 3 as a result of the reallocation, category 3 and related disbursement conditions will be eliminated. 8. Components and Cost. While the overall cost of components will remain the same, as procurement of both types of equipment (diagnostic and therapeutic) fall under Subcomponent 3.2 (Improve Cancer Management), the description of Subcomponent 3.2 will be modified slightly to explicitly include reference to the procurement of additional LINACs and exclude reference to the diagnostic equipment. 9. Results Framework. The Results Framework will be modified as follows: the target for the intermediate indicator “number of new linear accelerators installed at national level” will be increased from eight to twelve, reflecting the additional procurement of LINACs. There will be no change in PDO indicators. The PDO indicator related to radiotherapy waiting time has already been met3 and, given that the additional LINACs will be procured toward the very end of the Project life, no change in the end target of this indicator is proposed. 10. There will be no change in the closing date (December 31, 2022) as the client has experience in procuring and installing LINACs; the current closing date is sufficient for completion of this work. 11. There will be no change in the Project’s environmental safeguards category, nor need for triggering additional safeguards-related operational policies. The Project has adequate safeguards arrangements in place to cover the installation of new LINACs. The already established processes will continue to be used. 3 A monitoring system is in place to report on percentage of patients starting radiotherapy treatment at public hospitals within 28 days between the date of issuance of treatment protocol and the first radiotherapy session for (a) breast, (b) cervical, (c) prostate and (d) lung cancers (Yes/No). The World Bank Second Serbia Health Project (P129539) III. SUMMARY OF CHANGES Changed Not Changed Results Framework ✔ Components and Cost ✔ Reallocation between Disbursement Categories ✔ Implementing Agency ✔ DDO Status ✔ Project's Development Objectives ✔ PBCs ✔ Loan Closing Date(s) ✔ Cancellations Proposed ✔ Disbursements Arrangements ✔ Disbursement Estimates ✔ Overall Risk Rating ✔ Safeguard Policies Triggered ✔ EA category ✔ Legal Covenants ✔ Institutional Arrangements ✔ Financial Management ✔ Procurement ✔ Implementation Schedule ✔ Other Change(s) ✔ Economic and Financial Analysis ✔ Technical Analysis ✔ Social Analysis ✔ Environmental Analysis ✔ IV. DETAILED CHANGE(S) The World Bank Second Serbia Health Project (P129539) OPS_DETAILEDCHANGES_COMPONENTS_TABLE COMPONENTS Current Current Proposed Proposed Cost Action Component Name Component Name Cost (US$M) (US$M) Improvement of Health Improvement of Health 11.20 No Change 11.20 Financing Financing Improve Access to Quality Health Improve Access to Quality 8.90 No Change 8.90 Care Health Care Strengthening Quality of Service Strengthening Quality of 46.00 No Change 46.00 Delivery Service Delivery Monitoring and Evaluation and Monitoring and Evaluation and 4.90 No Change 4.90 Project Management Project Management TOTAL 71.00 71.00 OPS_DETAILEDCHANGES_REALLOCATION _TABLE REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Financing % Current Allocation Actuals + Committed Proposed Allocation (Type Total) Current Proposed IBRD-88300-001 | Currency: EUR iLap Category Sequence No: 1 Current Expenditure Category: G,W, nonCS, OC, TR, CS in. aud, SG 7,237,500.00 3,218,957.46 7,237,500.00 100.00 100.00 iLap Category Sequence No: 2 Current Expenditure Category: G, W for Part 3B (iv) 5,000,000.00 5,327,105.91 17,700,000.00 100.00 100.00 iLap Category Sequence No: 3 Current Expenditure Category: G, W for Part 3B (v) 12,700,000.00 0.00 0.00 100.00 100.00 Total 24,937,500.00 8,546,063.37 24,937,500.00 . The World Bank Second Serbia Health Project (P129539) . Results framework COUNTRY: Serbia Second Serbia Health Project Project Development Objectives(s) The PDO is to contribute to improving the efficiency and quality of the public health system of the Republic of Serbia through the strengthening of: (i) health financing, purchasing, and maintenance systems; and (ii) quality improvement systems and management of selected priority non-communicable diseases. Project Development Objective Indicators by Objectives/ Outcomes RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 To contribute to improving the efficiency and quality of the public health system of Serbia Percentage of total acute care hospitalization cases in public hospitals 0.00 0.00 0.00 50.00 70.00 75.00 80.00 95.00 95.00 95.00 95.00 reported accurately based on DRGs (Percentage) Percent reduction in average unit price relative to baseline for the 50 most 0.00 0.00 0.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 27.00 frequently dispensed multi- source The World Bank Second Serbia Health Project (P129539) RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 pharmaceuticals that are procured through centralized framework contracts (Percentage) Percentage of patients starting radiotherapy Monitoring Monitoring Monitoring treatment at public No system in system in Monitoring system in place hospitals within 28 monitoring place to place to system in to measure the days between the system in measure the measure the place to indicator, date of issuance of place to indicator, indicator, measure the baseline and treatment protocol report on the baseline and baseline and indicator target values and the first indicator target values target values defined radiotherapy defined defined session for a) breast, b) cervic (Text) Percentage of registered adult patients in Dom Zdravljas with recorded blood 35.00 35.00 35.00 35.00 32.00 33.00 36.00 40.00 45.00 45.00 45.00 pressure value, BMI, smoking status and recommended tips for healthy behavior in the preceding 12 The World Bank Second Serbia Health Project (P129539) RESULT_FRAME_TBL_PDO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 months in their med recor (Percentage) Percentage of registered insured persons covered by the targeted examination for a) 6%; a) 25%; a) 25%; a) 6%;b) a) 10%;b) a) 15%;b) a) 20%;b) a) 25%;b) early detection of a) b) 27%; b) 35%; b) 35%; 27%;c) 10% 27%;c) 15% 28%; c) 25% 30%;c) 30% 35%;c) 35% breast (age 50-69 in c) 10% c) 35% c) 35% the past two years), b) cervical (age 25- 64 in the past three years) and c) (Text) PDO Table SPACE Intermediate Results Indicators by Components RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 1. Improvement of Health Financing Percentage of pilot Dom Zdravljas who meet grant agreement 0.00 0.00 0.00 0.00 0.00 5.00 15.00 25.00 30.00 30.00 30.00 performance criteria in the preceding one year (Percentage) The World Bank Second Serbia Health Project (P129539) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 DRGs payment system developed and financing for a portion of acute No No No No No No No Yes Yes Yes Yes hospital care based on DRGs initiated (Yes/No) Number of health workers receiving 500.00 500.00 500.00 1,000.00 5,459.00 8,000.00 10,000.00 11,000.00 13,000.00 13,000.00 13,000.00 training (Number) 2. Improve Access to Quality Health Care Number of pharmaceuticals and health products that are procured 0.00 0.00 0.00 1,200.00 1,421.00 700.00 700.00 700.00 700.00 700.00 700.00 through centralized framework contracts (Number) Percentage of a) Dom Zdravljas and b) pharmacies DZs - 0 DZs - 0% DZs - 0% DZs - 0% DZs - 10% DZs - 70% DZs - 80% DZs - 85% DZs - 90% DZs - 90% DZs - 90% implementing e- Pharm - 0 Pharm - 0% Pharm - 0% Pharm - 0% Pharm - 27% Pharm - 70% Pharm - 80% Pharm - 85% Pharm - 90% Pharm - 90% Pharm - 90% prescription system (Text) Reduction in the total consumption 0.00 18.00 19.00 20.00 21.00 22.00 22.00 22.00 of antibiotics for systemic use (J01) The World Bank Second Serbia Health Project (P129539) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 DDD/1000 person/per day (Percentage) The linkage The linkage between between The linkage national national between clinical clinical Stakeholders national clinical Situation practice practice groups as practice analysis guidelines and guidelines and defined in the guidelines and completed. basic benefit basic benefit Limited Roadmap and basic benefit Roadmap package well package well institutional trained package well document established established efficiency according to HTA staff established and with detailed and and Strengthen systems related to the their roles. trained for the functional. The plan of functional. functional. for Health decision Implementati implementati new, robust activities for The new, The new, Technology making on of activities on of cost and HTA system robust and robust and Assessment (Text) process in the in accordance effectiveness transparent, establishment transparent, transparent, area of drug with analysis system of drafted and system of system of reimburseme implementati evidence based adopted by evidence evidence nt on schedule supported the Ministry based based defined in the decision of Health supported supported Roadmap making process decision decision fully making making established and process fully process fully functional established established and functional and functional No national No national No national Assessment of A medical Medical Multi-vendor Applicable Budget Budget Budget Strengthen systems systems or systems or systems or laboratory equipment equipment maintenance regulatory allocated to allocated to allocated to for medical policies in policies in policies in equipment, registry set up database in contract document expand expand expand The World Bank Second Serbia Health Project (P129539) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 equipment place, place. Medical place. Medical MRI and CT within IHIS the relevant evaluated. related to maintenance maintenance maintenance maintenance (Text) Medical equipment equipment status institution. Entity medical system. system. system. equipment database in database in completed Multi-vendor established equipment National National National database in the IPH the IPH maintenance for oversight maintenance system(s) in system(s) in system(s) in use the IPH contract of medical system use. use. piloted. equipment drafted maintenance Annual training organized for health 0.00 0.00 1.00 2.00 3.00 4.00 4.00 4.00 Roma mediators (Number) 3. Strengthen Quality of Service Delivery Number of clinical pathways developed 14.00 14.00 14.00 18.00 32.00 34.00 36.00 40.00 48.00 48.00 48.00 (Number) Number of health care institutions that have completed 50.00 50.00 50.00 60.00 64.00 70.00 100.00 120.00 160.00 160.00 160.00 staff training on priority clinical pathways (Number) Ranking of health Ranking of Ranking of Ranking of institutions Guidelines for Health Health Quality health according to quality Existing Existing Existing Existing Existing Improved quality Institutions Institutions indicators institutions criteria in place quality quality quality quality quality quality indicators and according to according to data according to based on quality indicators indicators/No indicators/No indicators/No indicators/No indicators/No Web database Quality Quality collection/No quality criteria indicators in health developed/No criteria, based criteria, based based on data care (Text) on data from on data from The World Bank Second Serbia Health Project (P129539) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 previous previous from previous year/Yes year/Yes year/Yes Number of new linear accelerators 0.00 0.00 0.00 0.00 1.00 6.00 6.00 8.00 8.00 8.00 12.00 installed at national level (Number) Action: This indicator has been Revised Percentage of adult diabetic patients in Dom Zdravljas with at least one determined value of 45.00 45.00 45.00 42.00 42.00 43.00 44.00 45.00 50.00 50.00 50.00 glycosylated hemoglobin (HbA1c) in the last year (Percentage) Percentage of registered adult patients in DZs with hypertension under treatment whom in the last recorded 45.00 45.00 45.00 45.00 51.00 55.00 60.00 65.00 70.00 70.00 70.00 blood pressure (measured in the preceding one year) is ≤ 140/90 mm Hg (Percentage) The World Bank Second Serbia Health Project (P129539) RESULT_FRAME_TBL_IO Indicator Name PBC Baseline Intermediate Targets End Target 1 2 3 4 5 6 7 8 9 Percentage of patients satisfied with the quality of 78.00 0.00 0.00 0.00 78.00 78.50 79.00 79.50 80.00 80.00 80.00 care in PHC facilities (CE) (Percentage) IO Table SPACE . The World Bank Second Serbia Health Project (P129539)