Transcript Comparing Health Systems - C

Comparing Health Systems
Health care systems:

Health care systems are about more
than just delivering a personal service
“Health care facilities in modern industrial
societies are great concentrations of
economic resources – and because of this
they are also the subject of political
struggle” (Moran, 1999)
Factors Shaping the Configuration of
Health Care Systems:
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Political factors:
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Government structure
How political decisions are made
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and values underpinning these decisions
 All affect health care policy and
degree of state involvement in the
direct provision of services.
Factors Shaping the Configuration
of Health Care Systems (2):
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Economic factors:
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A flourishing national economy means
more resources for health services
A declining national economy and
budgetary deficits means less
resources for health services
Impact of the global economy on the
national economy
Factors Shaping the Configuration
of Health Care Systems (3)
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Cultural factors:
Values which a nation shares will be
reflected in its health care system.
 There are important national cultural
differences
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nations respond differently to the same
pressures.
Factors Shaping the Configuration
of Health Care Systems (4)
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Demographic context:
Size of the population
 Geographical distribution
 Composition of the population (e.g.
age and gender)
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 All affect level and nature of demand
for health services.
Factors Shaping the Configuration
of Health Care Systems (5)
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Epidemiological trends:
Move from a concern with infectious
disease to a concern with chronic and
degenerative conditions, heart attacks
and strokes, AIDS, drugs and alcohol
abuse, child abuse, psychiatric
disorders and accidents…
 Need for more preventive services.
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Factors Shaping the Configuration
of Health Care Systems (5)
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Historical background and events
Social structures:
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patterns of employment and social
divisions (gender, race, religion) raise
concerns of equity in access to health
services.
Classification of health care
systems:
A. Based on the degree of government
involvement in funding and provision of
health care (free market system vs.
government monopoly)
– leads to 3 types of health care systems.
B. Based on the method and source of
funding (private sources vs. public
sources).
C. Rank countries on a single variable
such as the extent to which health care
is publicly funded
- measure of state involvement.
Classification of health care
systems (2):
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Most countries demonstrate
mixes of characteristics in
finance, provision and
governance across the various
types and there is often
variation across time and space
within a single country.
A. Classification based on
government involvement in funding
and provision of health care
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Three main types of health care systems
emerge along this continuum:
1. Private insurance
2. Social insurance
3. National Health Service.
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They represent ideal-types of specific
macro-institutional characteristics.
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The real world of health care is much more
complex.
Continuum of government
involvement – 3 health care systems
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Private insurance
Social insurance
National health service
Government Monopoly
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Free Market System
(1) Private insurance model or
consumer sovereignty model:
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Least state involvement in direct provision or
funding of health care services
Purchase of private health insurance financed
by employers and/or individual contributions
that are risk-oriented.
Private ownership of health care providers
and the factors of production
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although might include a publicly funded safety
net for the most vulnerable groups
Basic assumption: funding and provision of
health care is best left to market forces.
Private insurance model or
consumer sovereignty model (Contd.)
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Idea that market forces and competition
should lead to increased efficiency, choice of
health services and decreased cost of health
care.
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Best represented by USA and until recently by
Australia
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Is that true?
but many systems contain elements of this type.
Most inequitable system of health care, based
on assumptions of individualistic responsibility
for health care.
(2) Social insurance model or
Bismarck model:
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Based on a concept of social solidarity
Characterized by a universal coverage health
insurance generally within a framework of
social security
Compulsory health insurance
Funded by a combination of employer and
individual contributions through non-profit
insurance funds or societies, often regulated
and subsidized by the State.
Can lead to unequal financial burdens
associated with fragmented risk pools
Social insurance model or
Bismarck model (Contd.)
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Provision of services tends to be private,
often on a fee-for-service basis, although
some public ownership of the factors of
production and delivery is likely
Best examples: Germany, Japan and The
Netherlands.
Other examples: France and Belgium
Case of Singapore:
 compulsory social insurance.
(3) National Health Service
model or Beveridge model:
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Universal coverage funded out of general
taxation
New Zealand created the first national health
service in its 1938 Social Security Act
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promised all citizens open-ended access to all the
health care services they needed - free at the
point of use
Provision of health care services is fully
administered by the State, which either owns
or controls the factors of production and
delivery
National Health Service model or
Beveridge model (Contd.)
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Best examples are the UK, Sweden, New
Zealand.
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Although all have moved away from this system to
varying degrees
Other examples are Italy, Spain, Canada and
the other Nordic countries.
Equitable system, based on assumptions of
collective responsibility for health care
Issues:
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Can be expensive
Often fails to meet population’s expectations of a
high standard of quality of health care.
(B) Classification of health care
systems by method of funding
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Different countries use different
payment methods.
3 actors are involved:
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Consumers
Purchasers or insurers or “third-party”
payers
Service providers (e.g. GPs).
3 models of paying providers by
“third party” payers
1) Reimbursement model
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Consumers pay providers directly and are
reimbursed by the insurer.
Consumers also pay a premium to the insurer.
Examples: France and Belgium
2) Contract model
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Insurer contracts directly with providers to supply
specified services to consumers.
Consumers pay a premium to the insurer.
Examples: Netherlands, Germany and USA
3 models of paying providers by
“third party” payers (Contd.)
3) Integrated model
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Insurer (State) directly owns and manages the
providers.
Examples: UK National Health Service prior to
changes in 1990.
Consumers pay a premium to the insurer (State)
through general taxation
Purchaser or “third party
payer”- a focus:
Who undertakes the role of purchaser
depends on historical patterns, cultural and
historical values of the country
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USA: large employers and private corporations
UK: appointed local public bodies and private
primary care physicians
Germany: sickness funds
Sweden: regional or local tiers of elected
government.
Three functions of “third-party
payers”:
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Insurance function
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Agency function
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take on burden of financial risk involved in health
care utilization
reduce “moral hazard”
act as prudent and informed buyer on behalf of
consumers
provide information about quality of care.
cost containment.
Access function
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guarantee access to needed health services
Three functions of “third-party
payers” (2):
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In most countries, third-party payers have
effectively carried out 1st and 3rd functions
but not the second.
USA is example of country that has effectively
carried the second function at the detriment
of the first two
 use of health management organisations (HMO).
Pressures for health care
reform:
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In the last decade, health care has
become a major area of concern in all
developed nations because of a number
of factors and especially because of…
Pressures for health care
reform and reform strategies:
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Changes in the global and national economy
creating growing economic pressures, in the
1990s.
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Created pressures for national economies to
constrain health costs and manage scarce societal
resources.
The OECD has argued for the retrenchment
and restructuring of the social welfare system,
for cost containment and the need to devolve
some responsibility to the private sector.
Reform strategies
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As a response to economic pressures, nations
have introduced market-based approaches to
health care reform.
Market strategies, competition and
privatisation were seen as the answer to all
problems and especially to cost containment
in health care. Nations believed that
introducing market strategies would increase
efficiency while maintaining equity.
The health care reforms appeared to be quite
radical in discourse. However…
Moderators to a radical health
care reform:
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Democratic politics and interparty competitions
for votes can act as a moderator to the
radicalism suggested by economic pressures
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cases of UK and New Zealand.
Ideological, cultural values and prejudices will
affect a country’s receptivity to foreign ideas
of cost containment
Different countries give a different meaning to
competition in health care
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National variations in the way in which this idea has
been translated into policy.
Aims of health care reforms
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Macro-level aims: improved equity and
efficiency of health services
Micro-level aims:
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Improve micro-efficiency in the delivery of health
care services to reduce costs (tackle “moral
hazard”).
Improving the agency function of “third party”
payers
Improve flexibility and rates of innovation in the
health system to generate money.
 goal of health care reform for “integrated
systems” like the UK and Sweden
Improving the efficiency of the
delivery of health care services to
reduce costs meant:
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In “integrated” systems (UK, New Zealand):
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In countries where there was already a market
structure:
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splitting purchasing and providing functions
making providers compete for the receipt of (largely public)
funds through negotiated contracts
strengthening incentives for smart purchasing
opening contracts to competition (e.g. selective contracting
with providers)
The US already had a system of “managed
competition” in place
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but it was anarchic and Clinton wanted to make it a more
corporatised and regulated arrangement.
Did the nations achieve their
goals?
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Did market strategies and competition work
to increase efficiency and preserve equity?
Overall, the expressed aims of New
Zealand, the Netherlands and the USA
were not met.
It is broadly the case in the UK too although
the evidence is more ambiguous.
In the UK and New Zealand, reliance on
regulation increased overtime
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the competitive market had a detrimental effect
on the stability of providers, user access and
equity
Did the nations achieve their
goals (2)?
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Germany has been successful in controlling
the pharmaceutical budget and in reforming
the hospital finance system and the insurance
function to improve equity and consumer
choice
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but may have created new forms of perverse
incentives in such a highly regulated system.
Sweden has achieved real gains in efficiency,
consumer choice and diversity of provisions
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but faces problems of long-term sustainability.
Why did promise and
performance diverge so widely?
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Economic explanation:
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failure to use markets properly or
market could not achieve what it was expected to
achieve
– the problems were predictable
Political explanation:
Interaction between a wider range of factors:
 context in which the reform strategies are
introduced,
 process by which they are formulated,
implemented and evaluated
 content of the reforms
 main actors
What have countries learnt
from the reforms?
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In some countries, this has led to a lessening
of faith in market mechanisms and a partial
restoration of traditional planning and
command-and-control systems.
What have we learnt?
 Substantial degree of convergence between
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states in the perceived problems and burdens
facing health care systems and in language
used to express them.
However, policies are formulated and
implemented in divergent national contexts
- wide range of constraints (incl. ideological beliefs):
 limits policy options considered and the agenda of
reform,
 affects scope of the reforms and whether radical
or incremental change is pursued,
 shapes compromises made in the course of
implementation
What have we learnt (2)?
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Managed competition was seized as a “quick fix”
to solve diverse problems of health systems in
different countries
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BUT little evidence as to feasibility in country of
origin and transferability to different institutional and
cultural contexts.
“Evidence-based” medicine, managed care and
the shift from hospitals to primary care
settings can help contain costs and improve the
effectiveness and accessibility of services
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BUT can also generate unanticipated problems and
(like managed competition) can be implemented in
many different ways, with different benefits and
costs.
What have we learnt (3)?
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Financing health care mainly through private
insurance is neither equitable nor efficient
e.g. USA:
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insurance overheads and a competitive market has
made US system the most costly in the world
yet, millions of its citizens’ health care needs are not
covered.
Fiscal and economic pressures (which triggered
health care reform in the first place) have not
disappeared
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private markets are developing by attrition and default
as much as by conscious design.
What have we learnt (4)?
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Whether markets will go on rising in health
care or not is an open question
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will depend on how health care fits in the
political economy and political and social
culture of each country.
This is because health care has two faces:
1) It is a core function of the welfare state
2) It is a massive industry