Key elements of reform debate
HEALTH CARE
REFORM
IN THE NETHERLANDS
Gelle Klein Ikkink
Health Insurance
Directorate
Ministry of Health,
Welfare and Sport
1. Who is the prudent buyer of care on behalf on
the consumer?
2. Yes/No competition among:
• Providers of care?
• Sickness funds / insurers?
3. Which benefits package?
4. Which premium structure?
Reasons for reform
Single, multiple and
competing purchasers
in European health systems
16 million
inhabitants
100 hospitals
Finnland
Single purchaser
16000 medical
specialists
Estonia
Sweden
Regional, but functionally
single purchaser
Great-Britain
Ireland
21 insurance
companies
Germany
Czech Republic
Slovakia
Luxemburg
France
Switzerland
Austria
Hungary
Slovenia
Competing purchaser
8000 GP’s
Poland
Holland
Belgium
Non-competing
multiple purchaser
Serbia
Bosnia
Croatia
Portugal
Italy
Lack of
transparency
Consumers
Fragmented
insurance market
Latvia
Lithuania
Denmark
Unexpected
financial effects
around income
threshold
Lack of cost
consciousness
€ 60 billion spent
on health care =
10% GDP
Romania
Bulgaria
FYRM
ALB
- Lack of efficiency
- Lack of innovation
- Waiting lists
Providers
Insurers
Different rules
of market
game
Greece
Spain
Malta
Ciprus
Increasing pressure on the system by: growing wealth, advancing
medical technology and aging population.
Solution: less central regulation and stronger competition
The essence of the reform 2006
Means and ends
More room to move
(choice, invest,
contract)
Decentralized
responsibilities (duty of
care, duty to insure)
Innovation
Entrepreneurship
Health care meets demands
Price meets performance
Purchasing
health care
Equity
Sickness
funds (2/3)
Health
Private
Insurance
insurance (1/3)
Act
Public Insurance
Efficiency
Civil servants
•
•
•
•
•
•
Compulsory insurance (consumers)
Open enrolment (insurer)
Legally defined coverage (insurer)
No premium differentiation (insurer)
Submission to risk adjustment (insurer)
Income related contribution (consumer)
Managed competition
•
•
•
•
•
Compulsory deductible (consumers)
Free to set nominal premium (insurer)
Free to offer different policies (insurer)
Free to offer suppl. deductible (insurer)
Free to engage group contracts (insurer)
Q
ua
lit
y
• Freedom to contract, preferred providers
• From budget payment to pay for performance
• Free pricing in hospital care (2005:10%, 2009: 34%)
• Capital costs in integrated tariffs (DRG’s)
• Quality indicators for hospital care and outpatient care
• Development of guidelines, clinical standards
• Step by step increase the amount of risk
of
co
nt
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Instruments
of providers
of insurers
Performance
• Take off: with caution
• There is more space available than used.
Explanation:
Shortcomings incentive structure
Government oriented → self oriented →
each other oriented → future oriented
Period of incubation, trust building,
management of expectations
So far, so good
•
•
•
•
•
•
•
Initiatives managed care, DRG contracting
More focus on prevention
Substantial steps in increasing risk providers and
insurers
Preference policy pharmaceuticals
More relaxed attitude on preferred provides
Quality awareness moving upwards
Patient channeling with restitution of compulsory
excess
Any growth yet?
What’s next?
•
•
•
•
•
Will health care purchasing grow up?
Will the insurer be accepted as health care guide?
Will we / the insurer (!) be able to connect and
integrate separate domains (primary/hospital,
prevention/cure) ?
Will we succeed in improving incentive structures?
How far does the absorption capacity of the HC
sector reach?
Competition on insurance market
YAGWYPF
•
•
•
You always get what you pay for
80’s
First:
Then:
Now
Later
:
:
:
:
90’s
00’s
Availability
Waiting lists
Production
Health outcomes
•
•
•
•
t
Developments free pricing 2005 - 2007
•
•
•
•
•
•
Increase in volume seems to be moderate
Waiting times decrease slightly
Quality issues in negotiations: many talks less commitments
Tariffs “first portion” 10% DRG’s 2005: 2007: +2,1, 2008: -/- 1,6%
Tariffs “second portion” 10% DRG’s: 2008 + 1,9%
Balance of power hospital / insurer seems to be ok
2006: nearly 20% switched
2009: app. 4% (“just enough”)
Four insurance companies have almost 90% of the
market (“just enough”)
Fierce competition, particularly on premium
Cumulated losses 2006-2007 500 mln €
People satisfied with their insurer
Product differentiation below desired level
(modest initiatives on preferred providers)
Defaulters & uninsured
Both: 1.5% (240.000 each)
Defaulters
• Large portion didn’t pay as from 2006 (Σ 3000 €)
• Due to yearly open enrollment: merry-go-round along insurers
• 2007: ban on canceling policies
• 2009: withholding 130% nominal premium on income source
Uninsured
• 2008: Mapping, giving information
• 2009/2010:
• final warning
• fines
• Registration with insurer by government
You need public enforcement to sustain a private system….
Agenda 2007 - 2011
Agenda 2007 - 2011
Improve quality transparency
•
Increase risk providers
•
Increase risk insurers
End budget financing
Less ex-post corrections RAF
•
•
Ab Klink
Minister of Health
Incentive compulsory deductible
More prevention
Disease Management Programs
•
Limit free rider behaviour
•
Corporate governance
9 Uninsured
9 Defaulters
Don’
Don’t
ever
give up