In the last 20 years, demographic development in Bulgaria has been characterized by population decline, a low crude birth rate, a low fertility rate, a high mortality rate and an ageing population. Nor are these tools to be implemented in isolation from other policy steps related to regulation, the organization of provision, and payment mechanisms. We note specifically that these are not typically to be viewed as ' either/or ' options but instead as possible policy tools that work well in certain circumstance and not in others and sometimes in combination. The paper also includes a technical appendix that discusses some of the major financing mechanisms along with their pros and cons to help guide the reader as they read through the case studies. The case studies offer real world examples and are intended to illustrate some of the more interesting options available for consideration in the Guatemalan context. In section 4 we discuss four country cases – China, Colombia, India and Mexico, respectively – that have faced problems similar to Guatemala and have sought to devise innovative financing and payment mechanisms to address the health care and financial risk protection needs of their rural populations and those working in the informal sector. This section provides descriptive information on insurance coverage in Guatemala in the general population and among urban and rural populations, health care spending on outpatient care as well as overall health care spending for different income quintiles, an analysis of health spending and poverty ratios, heath spending and financial risk, and estimates of labor lost due to illness. These challenge areas include the inadequate health insurance coverage for its population, the equity (or lack thereof) of this coverage and the use of health system resources, the inefficiency with which health care is provided in Guatemala and the costs of health care. In section 3, we use data from the living standards measurement surveys (LSMS) 20 to generate additional supporting evidence for some of this descriptive analysis, and to highlight several challenge areas for Guatemala. In line with these objectives, the following section outlines the Guatemalan health care system including health services provided, the different entities involved in providing these services, the mechanisms by which health services are financed and the most recent figures on health sector financing. The second goal is to examine four developing country case studies that have addressed health financing issues similar to Guatemala and draw out lessons from their experiences for Guatemalan policymakers as they proceed to address their health policy goals.

The first is to provide a broad overview of the health care financing and provision system in Guatemala and in so doing, highlight some of the major challenges related to health financing that it faces.

Introduction This paper has two main goals.

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