Jon Magnussen
Nordic Case Mix Conference
Helsinki 2010

Denmark
– Kim Rose Olsen
– Anette Søberg Rød
– Jes Søgaard
– Anni Ankjær-Jensen
– Janni Kilsmark
Finland )
– Unto Häkkinen
– Miika Linna
– Mikko Peltola
– Timo Seppälä
– Kirsi Vitikainen
Norway
– Jon Magnussen
– Sverre Kittelsen
– Kjersti Hernæs
– Kjartan S Anthun
Sweden
– Clas Rehnberg
– Emma Medin

• Common goals and aspirations
– Equity
– Public participation
• Common structural features
– Tax based funding
– Decentralization – the role of regions, counties and municipalities
– (Local) Political governance

• Governance
• Financing and contracting
• Choice and rights
• There is a common model but we differ in how we approach important issues

Finland
Sweden
Denmark
Norway
Nursing/ home care
Municipality
Municipality
Municipality
Municipality
Primary health
Municipality
Counties
Regions
Municipality
Specialised health
(Municipality)
Counties
Regions
Regions

• Sweden and Finland both use DRGs but have local variations
– Finland mostly (?) for budgetary purposes
– Sweden partly for budgetary purpose, partly for activity based financing
• Geographical resource allocation less of an issue

• Norway have used DRGs in activity based financing since 1997
• Denmark introduced DRGs as a marginal payment in 1999, but have increased the use to cover 50 % of income in 2007
• Centrally initiated uniform models for the whole country

70
60
50
40
30
20
10
0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20??

• Productivity analysis on hospital level data
• Two separate analysis
– 1999-2004; Norwegian hospital reform
– 2005-2007; Specialised health care in Norway
• Data Envelopment Analysis (DEA) with Farrell technical productivity
• Bootstrapping to test differences and estimate confidence intervals
• Second stage analysis:
– Reform effects
– Financing models
– Structural factors

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+ x a) Feasability x b) Free Disposal y
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+ x x c) Convexity d) Minimum extrapolation

• Outputs 1999-2004:
– DRG-weighted Inpatients in 3 groups
• Medical, Surgical, Others
– DRG-weighted Day care patients in 2 groups
• Medical, Surgical
– Number of Outpatients
• Outputs 2005-2007:
– DRG-weighted inpatients
– DRG-weighted day care
– Number of outpatients

• Finland/Sweden – specialty discharge rather than hospital discharge
• Denmark – DK-DRG
• Day care – and outpatient visits

• Inputs:
– Operating costs in real value
– Problems:
• Comparability of price level for hospital inputs, variation across hospitals and remaining variation across countries
• Consistent removal of capital costs?
• Consistent removal of costs associated with research, teaching, psychiatric care etc etc
• Aggregation problem
– Sweden and Norway cannot always use hospital level data
– Scale interpretations are problematic,
Productivity/CRS model used

• 1999-2004:
– Common Nordic weights as (weighted) average of
NO/Fin/Swe cost weights
• 2005-2007:
– Norwegian weights
– Aggregate weights for complicated/uncomplicated
– Separate (calibrated) Danish weights
• Ideally: Patient level data grouped – so far not possible

1.100
1.000
0.900
0.800
0.700
0.600
0.500
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
Danmark
Finland
Sverige
Norge

Results 1999-2004
0.9
0.85
0.8
0.75
0.7
0.65
0.6
0.55
0.5
1999
Danmark
Series5
Series9
2000 2001
Sverige
Series6
Series10
2002
Finland
Series7
Series11
2003 2004
Norge
Series8
Series12

• Reform has increased productivity level by approx 4 %
• Robust to different specifications
• And:
– Changes in Activity based financing (ABF) has no effect (?)
– Changes in case-mix has no effect
– Length of stay (LOS) longer than expected (within each DRG) is associated with lower productivity
(severity or inefficiency)

90
80
70
60
30
20
10
50
40
0
2005
Finland
2006
Sweden Denmark Norway
2007

• Country
• Year
• Region
• Teaching hospital
• Case-mix index
• Length of stay deviation
• Share of outpatient activity
• Size

• Significant higher levels of productivity in Finland
– Small differences between Norge, Sverige og
Danmark
– Large intra country variations
• Diseconomies of scale?
– Could be case-mix
– Careful interpretation because different definitions of units
• Other explanatory variables – not significant
– Thus LOS deviation, no longer different

• Same result in three different analyes of Norway and Finland (1999, 1999-2004, 2005-2007)
• Same result in two analyses of Norway/Sweden
(1999-2004, 2005-2007)
• Why?
– Personnell mix?
– Level of personnell
– Capitalization?
– Case-mix
– Different institutional setting?

• Using patient level data to provide a common grouping of patients
• Harmonizing measurement of day care and outpatient activity
• Cost weights – or possibly more disaggregated analysis
• Micro level analysis to understand differences
• A larger dataset to be able to test second stage variables