Transcript Marzena Kulis

Health Financing Reforms in EU
Accession Countries: Salient
Features and Lessons Learned
Marzena Kulis
The World Bank
Gastein, September 2002
Based on „Expenditure Policies Towards EU Accession”
Study team led by Bernard Funck,
Health section written by Mukesh Chawla
Outline
Legacy
The inherited system and attendant issues
Motivation for reforms
Decentralization, consumer choice, debt management, etc,
Health financing reforms
Resource mobilization and resource allocation
Experience
Impact on efficiency and availability of resources
Lessons Learned
Design and implementation issues
Legacy: Financing and Delivery
Siemaszko model of health financing and organization
Publicly-funded health systems
Budgetary support for network of hospitals and clinics
Historical allocations, with minor adjustments
Providers typically state employees
Compensation typically salary-based
Universal access and broad coverage
Limited choice
Legacy: Attendant Issues
Low levels of technical and allocative efficiency
Underutilization of capacity in some areas and
under-supply in others
Overstaffing
Low levels of clinical quality
Shortage of drugs and medical supplies
Widespread dissatisfaction with the health
system among patients and providers
Legacy: Attendant Issues (continued)
Poor incentives for providers to develop fiscal and
strategic planning functions
Salary based compensation undermined the importance
of effort and productivity
Decline in resources following disruption in economic
activity and shrinking of tax base during transition
Pressure of inflation, technology, and rising consumer
expectations
On the positive side, financial risk protection and equity
maintained
Motivation for Health Reforms
Accompanied or followed broader structural changes in
governance, authority relationships and ownership
resulting from a combination of social, political and
ideological forces
Synonymous in spirit with rapid dismantling of the state
apparatus and with restoration of property and
ownership rights
Ideological move towards decentralization, privatization
of public sector services, and greater choice for people
Motivation for Health Reforms (continued)
Reforms in health financing to meet with the challenge
of resource mobilization and mounting debts
Reforms necessary to improve efficiency and
effectiveness of utilization of resources
Reforms to address public dissatisfaction among
patients
Reforms in production, delivery and management to
improve quality of health care services
Health Financing Reforms: Resource
Mobilization
Shift from general tax-supported system to
payroll-based insurance system as the
predominant source of health financing
Emergence of formal out-of-pocket payments as
an important source of financing
General tax revenue support for health systems
on the decline
Social Insurance and Taxation in
Public Spending on Health
Year
Social Insurance
General Taxation
Bulgaria
2001
40.1
59.9
Czech Republic
1999
89.5
10.5
Estonia
1999
88.3
11.7
Hungary
1996
85.6
14.4
Slovakia
1999
74.8
25.2
Slovenia
1999
96.2
3.8
Latvia
2001
0
100
Lithuania
2000
74.7
25.3
Poland
1999
82.8
17.2
Romania
2001
87.3
12.7
Characteristics of Social Insurance
Year
introduced
Salaried
(employer: employee)
Self-employed
Bulgaria
1999
6% of payroll (3:3)
6%
Czech
Republic
1993
13.5% (10:3.5)
13.5% of 35% of net pretax
income
Estonia
1992
13% (13:0)
13%
Hungary
1990
14% (11:3)
14% plus hypothecated tax of
US$170 per person
Slovakia
1994
13.7% (10:3.7)
13.7%
Slovenia
1993
13.25%
13.25%
Latvia
1998
28.4%
Lithuania
1997
Poland
1999
28.4% of personal income
tax
3% of payroll + 1/3 of
income tax
7.75%
Romania
1999
14% (7:7)
7%
3%
7.75%
Health Financing Reforms: Resource
Allocation
Significant changes in provider payment
General direction away from the traditional salary-based
compensation
Biggest changes in reimbursing physicians for primary
care, shifting toward capitation-based payments
Most countries using fee-for-service payments for
outpatient specialist care
Budgetary systems retained for inpatient care in most
countries; some move toward case-mix based systems
Estonia, Slovenia and Latvia compensate hospitals on a
per-day basis
Paying Health Care Providers
Primary Care
Bulgaria
Capitation payment
Outpatient Specialist
Care
Salary
Czech Republic
Capitation payment
Capped fee-for-service
Budget
Estonia
Capped fee-for-service
Hungary
Mix of capitation payment
and fee-for-service
Capitation payment
Slovakia
Capitation payment
Capped fee-for-service
(point system)
Salary/fee-for-service
Per-diem
payment
DRG (758
categories)
Budget
Slovenia
Capitation payment
Salary
Latvia
Salary + point system
Lithuania
Mix of capitation payment
and fee-for-service
Salary/Capitation payment
Poland
Capitation payment
Capped fee-for-service
Per-diem
payment
Per-diem
payment
Case-based
payments
Per admission
Romania
Mix of capitation payment
and fee-for-service
Capped fee-for-service
Global budget
Salary/fee-for-service
Inpatient
Care
Budget
The Reform Experience
Social health insurance emerging as the most
significant source of revenue
Total health expenditure per capita increased in almost
all the countries (Bulgaria only exception)
Estonia recorded the largest increase, from less than
2% of GDP in 1990 to 6.4% in 1999
Out-of-pocket expenditures range from a low of 4.9% in
Bulgaria to 39.4% in Latvia, most countries averaging
between 20% and 30%
Health Care Expenditures, 1990-99
Real GDP per Percentage
capita (US$, Change in real
1995 prices) GDP (1995)
Bulgaria
Czech Republic
Estonia
Hungary
Slovakia
Slovenia
Latvia
Lithuania
Poland
Romania
2000
2000-1990
1,492
5,258
4,228
5,444
4,160
11,681
2,549
2,043
3,682
1,312
-13.05%
-0.23%
-5.77%
12.09%
2.77%
20.93%
-31.16%
-31.58%
41.40%
-14.30%
Health Care Expenditure
per capita (US$, 1999)
Total Health
Expenditure
as % of GDP
Total % Public % Private 1990 1999
62
380
243
318
285
746
166
183
248
86
95.1
91.6
79.7
76.5
79.2
88.0
60.6
76.2
75.4
71.7
4.9
8.5
20.3
23.5
20.8
12.0
39.4
23.8
24.6
28.3
4.1
5.4
1.9
5.7
5.4
5.6
2.5
3
4.6
2.7
4.1
7.1
6.4
6.8
7.2
7.5
6.6
6.3
6.2
5.3
The Reform Experience (continued)
On the positive side:
Significant reductions in the number of hospital beds
Reduction in number of physicians in Latvia and Estonia
Status Quo:
However, service provision did not shift from relatively
expensive acute hospital sector to lower levels of care
And on the negative side:
Hospital admission rates increased while outpatient visits fell
No major change on the debt position
Hospital Beds, Physicians and Utilization
Patterns
Bulgaria
Czech Republic
Estonia
Hungary
Slovakia
Slovenia
Latvia
Lithuania
Poland
Romania
Hospital beds
per 1,000
(% change,
1990-99)
Physicians
per 100,000
(% change,
1990-99)
-23.39%
-22.44%
-37.94%
-14.74%
-9.50%
-8.11%
-36.75%
-24.60%
-22.73%
-18.05%
8.52%
11.81%
-12.03%
12.62%
18.46%
4.88%
-23.84%
-1.75%
5.61%
6.11%
Hospital
admission rates
per 100
(% change,
1990-99)
-16.82%
7.07%
6.36%
16.47%
17.99%
5.99%
-1.69%
31.42%
30.19%
3.08%
Outpatient
consultations
per person
(% change, 1990-99)
-18.18%
4.32%
-20.25%
25.81%
20.37%
13.23%
-39.51%
-15.38%
-10.00%
-22.89%
Lessons Learned
Health financing reforms need to address several
fundamental and systemic issues
The constitutional guarantee of free health care in most
countries under review creates a sense of entitlement
and create resistance to health insurance schemes that
explicitly ration access to health services
Important to focus on design and capacity issues
Presence of multiple health insurance companies do not
guarantee competition or incentives to contain costs
Lessons Learned
Insurance contribution rates and health service prices
need to be carefully and scientifically calculated
Insurance companies need to be selective in
contracting
Need for strong incentives for providers to better
manage facilities
Important to collect good information on inputs, costs
and health service outcomes
Conclusion
Many positive achievements recorded in the years following
the transition
Reforms have generally done well in safeguarding
allocations to the health sector
Spending on health as percent of GDP has increased in
almost all EU accession countries
However, health reforms have not performed well on
improving efficiency and containing debts
Most EU accession countries need to focus on the
challenge of resource allocation and identify new ways of
purchasing and paying for health services.