Loan to support policy reforms totals $150 million
The Inter-American Development Bank (IDB) has approved a $150 million loan to the Dominican Republic to gradually consolidate social security coverage and improve efficiency in health care spending by deepening reforms the government has been implementing in both sectors.
The program consists of a policy-based loan that aims to consolidate implementation of the Dominican Social Security System (SDSS in Spanish) created in 2001 and the National Health Care System. In order to achieve this, the legal framework for the design of financing regimes will be modified. Also, operational measures will be put into place, as will monitoring systems and financial information and education. Gradual coverage increases are expected in both the Subsidized Regime and the Contributive Regime.
In 2013, the number of people signed up with the Dominican Social Security System who actually paid into it was 1.37 million. In comparative terms that was one of the lowest in the region. Only 58 percent of workers pay into the system, and only 15 percent of adults over age 65 now receive a retirement pension.
Another goal of this initiative is to improve the efficiency of the National Healthcare System. This includes defining a new organizational and functional structure for the Public Health Ministry by separating the tasks of oversight and provision of services; overhauling the provision of services through a care model based on integrated networks and a focus on primary care and encouraging the implementation and spread of quality health care policy, among others.
The $150 million come from the IDB’s ordinary capital and have a payback period of 17.5 years, with a grace period of 10.5 years and an interest rate pegged to the LIBOR.
The loan is the first of a programmed series in support of policy reforms. These two loans are contractually independent but linked technically.