1
THE
COMMONWEALTH
FUND
• Netherlands and Germany have achieved universal
coverage with multiple competing insurance funds
– Both include public oversight and market “rules” that
govern terms and scope of competition in public interest
• Multiple reforms in each country seek to enhance value
– Insurance risk funds seek to focus competition on value
– Comparative effectiveness and public reporting
– Payment reform
– Chronic disease, coordination and primary care
– Health information technology (HIT)
• Reforms and innovations have sparked international
interest
– Opportunities for cross-national learning
– Insights for the United States
Health System Innovations: Opportunities to
Learn from the Netherlands and Germany
Cathy Schoen
Senior Vice President, Commonwealth Fund
Learning from European Countries:
Health Care Markets and Regulation in the
Netherlands and Germany
February 4, 2009
THE
COMMONWEALTH
FUND
3
Opportunities to Learn: Netherlands
• Germany also does well compared to the U.S.
– System is similar to U.S. in open access to specialists;
fee for service payments
– Compared to Dutch, weaker primary care
– Currently operates with two insurance markets: social
insurance and private
• Leadership: Public oversight and infrastructure
– Federal Joint Committee
– Comparative effectiveness/reference pricing
– Quality Metrics and feedback
– Risk fund
• New initiatives focus on chronic disease, payment
innovations and insurance reforms
THE
COMMONWEALTH
FUND
International Comparison of Spending on
Health, 1980–2006
Average spending on health
per capita ($US PPP*)
$6,000
$5,000
Percent of National Health Expenditures
Spent on Insurance Administration, 2005
5
10
15.3%
16
8
14
$4,000
$3,391
$3,000
$3,371
9.3%
2
4
United States
Germany
2
Netherlands
OECD Average**
$2,000
$0
4
8
02
4.2
3.9
3.3
a
a
THE
COMMONWEALTH
FUND
d
Ja
n
pa
st
Au
ra
b
li a
i te
Un
06
04
20
98
2.3
1.9
an
nl
Fi
20
20
96
94
92
90
88
00
20
19
19
19
19
19
84
82
80
06
86
19
19
19
19
19
02
04
20
20
20
96
00
94
98
20
19
19
19
88
92
86
84
82
80
90
19
19
19
19
19
19
2.8
4.8
4.3
0
0
* PPP=Purchasing Power Parity. ** All 30 OECD countries except U.S.
Source: OECD Health Data 2008, Version 06/2008.
7.5
6.9
5.6
6
10.6%
10
6
$1,000
6
Net costs of health insurance administration as percent of national health expenditures
18
12
19
THE
COMMONWEALTH
FUND
Total expenditures on health as
percent of GDP
$6,714
United States
Germany
Netherlands
OECD Average**
4
Opportunities to Learn: Germany
• Netherlands often stands out in comparison to the United
States and other countries
• International data and Fund IHP surveys find stark contrasts
– Costs low compared to the United States
– Broad access and financial protection
– Strong primary care foundation
– Most positive public views
• Dutch 2006 reforms and innovations
– Individual mandate and “managed competition”
– Risk equalization fund
– Payment reforms
– Quality and patient experiences
$7,000
2
Overview
d
ng
Ki
m
do
st
Au
ria
na
Ca
da
t
Ne
a
r la
he
s
nd
i
Sw
e
tz
rla
nd
Ge
rm
2004 b 2001
* Includes claims administration, underwriting, marketing, profits, and other administrative costs;
based on premiums minus claims expenses for private insurance.
Data: OECD Health Data 2007, Version 10/2007.
y
an
Fr
an
ce
d
i te
Un
St
es
at
*
a
THE
COMMONWEALTH
FUND
Source: Commonwealth Fund National Scorecard on U.S. Health System Performance, 2008
1
Mortality Amenable to Health Care, 2002/2003
7
8
Access, Coordination & Safety
Deaths per 100,000 population *
Base: Adults with any chronic condition
150
100
71
65
71
74
74
80
77
82
84
82
84
90
93
110
103 103 104
96 101
50
ly
na
d
No a
Ne
r
t h w ay
er
la
nd
Sw s
ed
e
Gr n
ee
ce
Au
s
G e t ri a
rm
an
y
Fi
Ne
nl
an
w
d
Ze
al
a
De nd
Un
n
ite
m
d
K i a rk
ng
do
m
Ir e
la
nd
P
U n o rt
ug
i te
a
d
St l
at
es
ai
n
I ta
AUS CAN
FR
GER
NETH
Access problem due
to cost*
36 25 23
26
7
31 13 54
Coordination
problem**
23 25 22
26
14
21 20 34
Medical, medication,
or lab error***
29 29 18
19
17
25 20 34
NZ
UK
US
Ca
Sp
n
lia
Au
st
ra
pa
an
Fr
Ja
ce
0
Percent reported in past
2 years:
* Countries’ age-standardized death rates before age 75; including ischemic heart disease, diabetes, stroke, and
bacterial infections. See report Appendix B for list of all conditions considered amenable to health care in the analysis.
Data: E. Nolte and C. M. McKee, London School of Hygiene and Tropical Medicine analysis of World Health
Organization mortality files (Nolte and McKee 2008).
*Due to cost, respondent did NOT: fill Rx or skipped doses, visit a doctor when had a medical problem, and/or get
recommended test, treatment, or follow-up.
**Test results/records not available at time of appointment and/or doctors ordered test that had already been done.
***Wrong medication or dose, medical mistake in treatment, incorrect diagnostic/lab test results, and/or delays in abnormal
test results.
THE
COMMONWEALTH
FUND
Source: Commonwealth Fund National Scorecard on U.S. Health System Performance, 2008
Out-of-Pocket Medical Costs in Past Year
9
Data: 2008 Commonwealth Fund International Health Policy Survey of Sicker Adults
Source: C. Schoen et al., “In Chronic Condition: Experiences of Patients with Complex Healthcare Needs in Eight
Countries, 2008”, Health Affairs Web Exclusive, November 13, 2008.
THE
COMMONWEALTH
FUND
10
Length of Time With Regular Doctor or Place
Base: Adults with any chronic condition
Percent
100
More than US $1,000
Under US $500
100
Base: Adults with any chronic condition
81
80
80
60
60
72
61
57
57
43
41
40
20
4
8
13
14
31
40
25
20
20
0
Percent
AUS
CAN
FR
GER
NETH
Has regular doctor or
place of care
96
97
99
99 100 98 99 91
With regular doctor or
place for five years or
more*
58
64
75
79
79
NZ
UK
US
61 73 49
0
U K ET H G E R
N
NZ
CA
N
AU
S
US
U K ETH
N
N Z CA N G E R AU S
Data: 2008 Commonwealth Fund International Health Policy Survey of Sicker Adults
Source: C. Schoen et al., “In Chronic Condition: Experiences of Patients with Complex Healthcare Needs in Eight
Countries, 2008”, Health Affairs Web Exclusive, November 13, 2008.
US
*Base includes those with and without a regular doctor or place of care.
THE
COMMONWEALTH
FUND
Difficulty Getting Care After Hours Without
Going to the Emergency Room
11
Base: Adults with any chronic condition who needed after-hours care
Data: 2008 Commonwealth Fund International Health Policy Survey of Sicker Adults
Source: C. Schoen et al., “In Chronic Condition: Experiences of Patients with Complex Healthcare Needs in Eight
Countries, 2008”, Health Affairs Web Exclusive, November 13, 2008.
Primary Care Doctors: Has Arrangement for
Patients to See Nurse/Doctor After-Hours
Percent reported very difficult getting care on nights, weekends, or
holidays without going to ER
Percent
60
100
40
40
29
20
15
15
20
33
34
95
90
87
81
80
12
76
60
20
THE
COMMONWEALTH
FUND
47
40
40
40
US
US
20
0
0
NETH
GER
NZ
UK
FR
CAN
AUS
Data: 2008 Commonwealth Fund International Health Policy Survey of Sicker Adults
Source: C. Schoen et al., “In Chronic Condition: Experiences of Patients with Complex Healthcare Needs in Eight
Countries, 2008”, Health Affairs Web Exclusive, November 13, 2008.
US
THE
COMMONWEALTH
FUND
NETH
NZ
UK
AUS
GER
CAN
Data: 2006 Commonwealth Fund International Health Policy Survey of Primary Care Physicians
Source: C. Schoen et al., “On The Front Lines of Care: Primary Care Doctors' Office Systems, Experiences, and
Views in Seven Countries,” Health Affairs Nov. 2, 2006.
THE
COMMONWEALTH
FUND
2
Access to Doctor When Sick or Needed Care
13
Base: Adults with any chronic condition
Percent
Same-day appointment
75
75
Electronic Clinical Information Capacity with Exchange
and Decision Support, 2006
Percent reporting EMR
Used ER for condition treatable by
regular doctor, if available
98
100
92
60
50
43
26
26
19
17
6
0
6
8
8
23
US
28
25
N
H
ET
NZ
UK
F R AUS
US CAN
THE
COMMONWEALTH
FUND
15
Patient Perceptions of Inefficient or Wasteful Care*
0
Base: Adults with any chronic condition
NZ
AUS
GER
US
CAN
NZ
UK
AUS
NET
GER
US
CAN
Views of Health System: Percent Said Need 16
to Rebuild Completely*
Base: Adults with any chronic condition
Percent
Percent
60
34
UK
*Count of 14: EMR, EMR access other doctors, outside office, patient; routine use electronic ordering tests, prescriptions,
access test results, access hospital records; computer for reminders, Rx alerts, prompt tests results; easy to list diagnosis,
medications, patients due for care.
THE
COMMONWEALTH
Data: 2006 Commonwealth Fund International Health Policy Survey of Primary Care Physicians
FUND
Source: C. Schoen et al., “On The Front Lines of Care: Primary Care Doctors' Office Systems, Experiences, and
Views in Seven Countries,” Health Affairs Nov. 2, 2006.
60
27
19
25
8
0
Data: 2008 Commonwealth Fund International Health Policy Survey of Sicker Adults
Source: C. Schoen et al., “In Chronic Condition: Experiences of Patients with Complex Healthcare Needs in Eight
Countries, 2008”, Health Affairs Web Exclusive, November 13, 2008.
38
32
23
9
NET
R
GE
50
42
0
F R AU S CA N
40
72
59
25
UK G E R
83
75
50
25
NZ
87
50
42
36
H
100
89
75
48
T
NE
Percent reporting 7 or more out of 14
functions*
79
54
14
40
43
46
43
40
33
28
20
20
9
12
16
20
21
23
AUS
NZ
FR
26
0
0
UK
NETH
NZ
AUS
CAN
FR
GER
NETH
US
*Doctor recommended treatment you thought had little or no benefit and/or you often/sometimes felt time was wasted
due to poorly organized care.
Data: 2008 Commonwealth Fund International Health Policy Survey of Sicker Adults
Source: C. Schoen et al., “In Chronic Condition: Experiences of Patients with Complex Healthcare Needs in Eight
Countries, 2008”, Health Affairs Web Exclusive, November 13, 2008.
THE
COMMONWEALTH
FUND
Netherlands 2006 Reform: Universal
Coverage and Managed Competition
17
UK
CAN
GER
*Possible responses: “On the whole, the system works pretty well and only minor changes are necessary to make it
work better”; “There are some good things in our health care system, but fundamental changes are needed to make it
work better”; “Our health care system has so much wrong with it that we need to completely rebuild it.”
Data: 2008 Commonwealth Fund International Health Policy Survey of Sicker Adults
Source: C. Schoen et al., “In Chronic Condition: Experiences of Patients with Complex Healthcare Needs in Eight
Countries, 2008”, Health Affairs Web Exclusive, November 13, 2008.
US
THE
COMMONWEALTH
FUND
Netherlands National Leadership Oversight
18
DUTCH HEALTH MINISTRY
• Universal coverage
– Individual mandate in unified health insurance system
• Combined social insurance for middle and low income (68%)
and voluntary private insurance for higher income (32%)
– Premium subsidy for low/modest income adults
– Groups eligible for up to 10% premium discount
• Dutch Health Insurance Board : risk equalization
fund and comparative effectiveness/benefits (acute
and long term)
• Dutch Health Care Inspectorate supervises the
quality of the care.
• Choice of private plans with strong public oversight
– National insurance exchange with risk equalization
– Public website to compare insurers and hospitals
– Prohibit premium variation by health risk, age or sex
• Context:
– Started with low rates uninsured (1.5%); universal social insurance
for long-term care since 1968 (AWBZ Exceptional Expenditures)
– Strong primary care foundation, including after-hours care
– Transition from regulated budgets to freer prices
THE
COMMONWEALTH
FUND
• Dutch Competition Authority prevents cartels,
authorizes or forbid mergers, prevents the abuse of a
dominant market position.
• Dutch Health Care Authority manages competition;
prices and budgets; transparency
THE
COMMONWEALTH
FUND
3
Dutch Health Care a Triangle: National Leadership 19
Central to Health System Change
• 50% of premium is flat rate charged to adults (Annual
1,050 euro per adult)
• 50% from income-related contribution paid into a risk
equalization fund (6.9% income through employer)
Government
Insurers
Source: P. Hulsen, Market and Consumer Department, Ministry of Health, Welfare and Sport; Presentation to
AcademyHealth Netherlands Health Study Tour Sept. 22, 2008, “The Position of the Patient and Healthcare Quality.”
THE
COMMONWEALTH
FUND
Dutch Risk Equalization System Behind the Scene: 21
Each Adult Pays Premium About 1,050 Euro Annual
In €’s / yr
Age / gender
Women, 40, jobless
with disability
income allowance,
urban region,
hospitalised last year
for ostéoarthrite
€ 934
Man, 38 , employed,
prosperous region, no
medication or
hospitalisation last year
neither any chronic
disease
€ 872
Income
€
941
-/- €
63
Region
Pharmaceut.
costgroup
Diagnostic
costgroup
€
98
-/- €
67
-/- €
315
-/- € 315
€ 6202
-/- € 130
€ 7800
€ 297
From REF
20
• Effort to focus competition on value, innovation
– Insurers as prudent purchasers
• Sophisticated risk equalization scheme –
cornerstone for strategy
Patients
Care
Zorgaanbieders
Providers
Dutch Managed Competition Strategy
Source: G. Klein Ikkink, Ministry of Health, Welfare and Sport; Presentation to AcademyHealth Netherlands Health
Study Tour on September 22, 2008, “Reform of the Dutch Health Care System.”
– Public authority allocates fund to insurers
– Data on all 16 million Dutch residents
• Market rules require same premium for all adults for
same benefit; standard national benefit design
THE
COMMONWEALTH
FUND
Netherlands Insurance and System Reforms
22
• Payment policies and reform
– Budgets plus global fees for hospital and specialists
• Moving from central budgets/pricing to “freer” prices
• 20% in 2008 negotiable with insurers
– Selective contracting permitted but as yet rare
– Prescription medicines
• Maximum price (average Germany, France, Belgium, UK);
reference pricing; assessment; safety (HIT initiative)
THE
COMMONWEALTH
FUND
Netherlands A Work in Progress –
Opportunities to Learn
23
• Dutch initiatives seek to move to a high value health system
with “managed” competition focused on outcomes
• Challenges and issues to watch
– Will insurers become prudent purchasers and stimulate
delivery system innovation?
• Highly concentrated insurance market (top 4 = 90%)
– What will happen to costs as the government loosens
budget and pricing controls?
– Coverage:1.5% uninsured; 1.5% default on premiums
• Insights for United States
– Trust and cooperation with shared goals
– Importance of national oversight authorities and roles
• System in transition – opportunities to learn
THE
COMMONWEALTH
FUND
– Primary care: mix capitation/FFS (60/40)
• Comparative effectiveness
• Health information technology
• Quality metrics, patient experiences and transparency
– Website “choose better” kiesbeter.nl
• Public health
THE
COMMONWEALTH
FUND
German Health Care and Insurance System
24
• Federalist structure: National standards and guidelines
– national and regional insurance funds;
– private providers; public, non-profit, for-profit hospitals
• Social Insurance (“Sickness Funds”)
– Required for middle- and low-income population
– ~210 funds cover 90% of the population
– Income-related contribution
– Joint negotiations between federal association of Funds and
providers organizations, within national budget guidelines
• Private insurance: High-income population (above $63,095 USD)
can opt for private insurance
– different market rules; covers 10% of population
– <0.5% of population is uninsured; mandate in 2009
• Benefits: Broad; low cost sharing; maximum out-of-pocket
costs=2% of income (1% if chronically ill)
THE
COMMONWEALTH
FUND
4
25
The German system at a glance (2007) ...
“Risk-structure compensation” Insurance
a1
26
German Federal Health Insurance Fund: 2007
~210 sickness funds
~ 50 private insurers
Wage-related contribution
Pay out optional
of unspent fund
balances can
pay to insured
Sickness Funds
Risk-related premium
Choice of fund
delegation
& limited
governmental control
Population
Social Health
Insurance 85%,
Private HI 10%
Insured member
Choice
Contracts,
mostly collective
No contracts
Requirement
If additional
contribution (flat
rate or percentage)
which must not
exceed 1% of
individual
member’s income
Risk-adjusted
payment per
insured person
Federal Health Insurance Fund
Providers
Public-private mix,
organised in associations
ambulatory care/ hospitals
Government
tax revenues
Employee
contribution –
Income Related
Employer
contribution –
Wage Related
8.2%
7.3%
Reinhard Busse, University Berlin and,European Observatory Presentation to Commonwealth Fund 2008
27
Oversight of the German Health Care System
28
Germany: Opportunities to Learn
• Geographic chronic disease: model taken to scale
– Tracking health outcomes and resource costs
• Primary care and care coordination
– Will Germany develop new teams approaches?
• Global fees: moving to more “bundled” per episode
• Comparative Effectiveness: benefits and pricing
• German Federal Ministry of Health: Legal framework,
planning, supervision, accreditation, commissioning, and
enforcement
• Federal Joint Committee: Core of self-regulatory structure
– composed of insurer, provider, and neutral reps; patients
have advisory function
– legally binding directives
– defines SHI benefit package
• Institute for Quality and Efficiency in Healthcare
(IQWiG): Comparative/cost effectiveness
• Federal Health Insurance Fund: Risk equalization
• Federal Office for Quality Assurance (BQS): Hospital
quality indicators, benchmarks and feedback
– Part of multiple country global efforts
– Priorities set by national policy
– Potential sharing with U.S. Center if one develops
• Insurance market reforms
– Cooperation and competition?
– Dutch and German approaches differ; risk equalization and
financing
• Leadership authorities
THE
COMMONWEALTH
FUND
THE
COMMONWEALTH
FUND
29
The U.S. Model: National Leadership Minimal
30
U.S. Opportunities to Learn
• Universal coverage in a multi-payer system
Competition
–
–
–
–
–
Patients
AND
Contention
Insurance market reforms with “insurance exchange”
Efforts to focus competition on quality, efficiency: value
Dutch and German approaches differ – offers insights
Risk equalization models
Payment reforms
• Information systems, quality and public Reporting
Care
Providers
Zorgaanbieders
• Leadership authorities: markets and collaboration
Insurers
Source: S. Schoenbaum, Presentation at Commonwealth Fund's 11th International Symposium on Health Care
Policy on November 14, 2008, “2008 International Symposium on Health Care Policy: Closing Remarks.”
THE
COMMONWEALTH
FUND
–
–
–
–
Public oversight and infrastructure
Different organizational models
Each has evolved and is evolving
Insights for U.S. for new public roles
THE
COMMONWEALTH
FUND
5
Slide 26
a1
Mirella Cacace for CWF
afolsom, 1/15/2009