Skopje, 9 November 2009

Willy PalmDissemination development Officer

Best practices of selected EU countries

concerning the provision of healthcare services

to people not covered by social health insurance

IPA Social Security Co-ordination and Social Security Reforms

• International agencies– WHO Regional Office for Europe, the

European Investment Bank, the World Bank, the Open Society Institute

• National and regional governments– Belgium, Finland, Greece, Norway, Spain,

Sweden and Slovenia, as well as the Veneto Region of Italy

• Academia– the London School of Economics and Political

Science (LSE), the London School of Hygiene & Tropical Medicine (LSHTM)

A partnership that reflects evidence-based policy-m aking

3

Country monitoring

• Health Systems in Transition (HiT) profiles are country-based reports thatprovide a detailed description of eachhealth care system and of reform and policy initiatives in progress or underdevelopment.

– produced by country experts – based on a common template– covering the whole European region

and selected countries elsewhere

4

Health systems and policy analysis

• We run and publishcomprehensive, systematic, comparative healthcaresystems analysis on a range of topical issues and policyaspects

– Validated evidence –research

– Tailored to policy-makingneeds

– Freely accessible

5

Dissemination• Disseminating generated

evidence to decision-makers in the health sector is an essential component of our mission to inform the policy process.

– Publications– Web– Personal interaction

(policy dialogues)

6

Observatory VeniceSummer school

• Our Summer School brings together high level policy-makers in a stimulating environment where experiences can be openly discussed and information freely exchanged.

• While there is some formal teaching, the emphasis is on a participative approach.

• Human Resources for Health (2007)

• Hospital Re-engineering (2008).• Innovation and Health

Technology Assessment: Improving Health System Quality (2009)

• EU integration and healthsystems (2010)

7

Overview

• Framing the problem of uninsurance

• Universal coverage: what do we understandby it?

• Broad approach to universal cover– Population coverage– Service coverage– Cost coverage

• Solidarity vs. financial sustainability?

8

The uninsured: expelled from paradiseThe uninsured: expelled from paradise

From I. Kickbush

USA: 45 million uninsured (2008)

Health insurance premiums outpacing normal inflation

Insurance coverage decreasing

12 12

"If we do not fix our health care system, America may go the way of GM -- paying more, getting less and going broke,”

The AMA agrees with Obama on the need for health care reforms but has reservations about the creation of a "public option" paid for by the government to ensure coverage for the 46 million uninsured Americans.

American Medical Association (AMA)158th Annual Meeting, June 15, 2009

Social inequalities in health and access to health care

0

5

10

15

20

25

30

20-24 25-29 30-34 35-39 40-44 45-49

deat

hs /

100,

000

US black, m

US white, f

US white, m

US black, f

Sweden, m

Sweden, f

Diabetes mellitus

14

US - Federally Qualified Health Center (FQHC) • Health Center Consolidation Act (1996)• “safety net” providers: community-based health

centers providing comprehensive PHC and preventive care to persons of all ages, regardless of their ability to pay

• 20% co-insurance with sliding-fee scale based on patients' family income and size

• Medicare patients, poor (homeless, migrants, non-US citizens, etc.), 40% uninsured

• To reduce the patient load on hospital emergency rooms

15

Rates of uninsurance in European Union

• 0.3% Germany (but 10% private)

• 1% (+ 2.2% defaulters) Netherlands(previously 35% private)

• 1.6% Switzerland• 2% Austria• 2.1% Poland

• 5% Estonia• 12.9% Bulgaria (1 mln.)

LuxembourgCzech RepublicUnited Kingdom

Denmark 1NorwayIceland

Netherlands 1SwedenJapanFranceIreland

New Zealand 2Italy

GermanyAustriaFinlandOECD 3

Belgium 1Turkey 4

SpainHungaryPortugalCanadaPoland

Slovak RepublicAustraliaGreece

SwitzerlandKorea

United StatesMexico

91

88

87

85

84

82

82

82

81

80

78

78

77

77

76

76

74

73

71

71

71

71

70

70

68

68

62

60

56

46

44

0255075100

-2

-9

4

3

1

-5

11

-8

4

3

7

-4

-2

1

3

-5

0

n.a.

10

-8

-18

5

-4

-22

n.a.

2

8

8

16

6

4

-25 0 25% total expenditure on health Percentage points

Public funding of total health expenditure (OECD countries 2006)

1. Data refer to current expenditure. 2. 2003. 3. The OECD average excludes Belgium and Slovak Republic. 4. 2005.2. Source: OECD Health Data 2008.

010

2030

4050

6070

8090

100

CYP ROU IRL MLT AUT PRT ITA UK FRA FIN

Increase: public spending as a % of total expenditure on health

Decrease: public spending as a % of total expenditure on health

1996 new states

2005 new states

1996 old states

2005 old states

010

20304050

607080

90100

SV

K

BG

R

ES

T

HU

N

BE

L

LVA

GE

R

PO

L

LTU

SV

N

GR

C

SP

A

SW

E

LUX

CZ

E

NLD

DN

K

Source: WHO 2007

18

The founding fathers of universal coverage in Europe

NikolaiAlexandrovich

Semashko

1874-1949

William Henry Beveridge

1879-1963

Otto vonBismarck

1815-1898

Taxes

Social insurancePrivate health insurance

Source: WHO 2007

0%

20%

40%

60%

80%

100%

UK

SW

E

DN

K

IRL

MLT ITA

PR

T

ES

P

FIN

CY

P

GR

C

LVA

BG

R

0%

20%

40%

60%

80%

100%

CZE

FR

A

LU

X

ES

T

SV

N

GE

R

SV

K

BE

L

HU

N

NLD

RO

U

LTU

PO

L

AU

T

Mix of contribution mechanisms, 2005

Out of pocket payments

Can payroll contributions continue to account for a t least 90% of Germany’s SHI revenue? What options to avoid ha rmful impact on labor market and competitiveness?

10%

15%

20%

25%

30%

35%

40%20

04

2007

2010

2013

2016

2019

2022

2025

2028

2031

2034

2037

2040

aver

age

cont

ribut

ion

rate

basis scenario 1 scenario 2

Source: Dirk Sauerland, WHL Graduate School of Business and Economics, presentation to 6th European Conference on Health Economics, 6-9 July 2006, Budapest

Mainly public actors

Autonomisation, contracting in private provision, outsourcing, PPP

Public actors

Purchaser-provider splitMore regional and local devolution

Tax funded

(Beveridge)

Provision sidePurchasing side

Public actors

Private practice

Public actors

Move to social healthinsurance and purchasingmodel (single – multiple)Informal payments

CEE and NIS

(Shemasko)

Mainly private actors

More selective contracting, performance-basedpayments, integrated care models

Semi-public actors

Integrating private insurersUser chargesComplementary HI

Social healthinsurance

(Bismarck)

22

Beveridge or Bismarck?

“It doesn’t matter whether the cat is

black or white. As long as it

catches mice!”

Deng Xiao Ping

23

The notion of solidarity

«The very notion of solidarity, on which our social security systems are based, demands an universalisation of its extent. It is contradictory to the idea of solidarity itself, to limit it to a certain group to which one belongs…

When this limited solidarity occurs among the rich, to the exclusion of the poor, it is not solidarity at all. It is protectionism and collective selfishness, not deserving the name ‘social’.»

Van Langendock J (2007) The Right to Social Security

Solidarity EquityParticipation

Equity in utilization and resource distribution

Quality

Transparency and accountability

Efficiency

Choice

Equity in finance

Financial protection

Health gain

Equity in health

Responsiveness

Health system goals (WHR2000)

Purchasing

Benefits

Revenue collection

Pooling

Health financing system

How health financing can influence goals

Service delivery

Ste

war

dshi

pResource

generation

Health financing within overall system

Core values

25

Reform and public policy objectives

• Cutler (2002): successive waves of healthcare reform

– Ensuring universal access to medical care

– Centralised regulation-based cost containment by various rationing mechanisms

– Decentralised market- and incentive-based systems

Choice and competition in health insurance

no free choicefree choice

collective contracting

selectivecontracting

single payer

multiple payers

Poland

Estonia

Hungary

Slovenia

Austria

France

Luxembourg

Belgium

Czech Rep.

Slovak Rep.

Netherlands

fixedcontributions

variable contributions(premiums)

Switzerland

Germany

27

Renewed interest in universal coverage

• Move towards more private competition-based health insurance systems

•• Non-active and non-contributing groups in

universal SHI-systems (problem of defaulters)

• Small but persistent pockets of uninsured

• Depth of universal coverage (cost-sharing)

28

Universal coverage: what do we understand by it?

• as a situation in which the entire population of a country has access to appropriate health care services when needed and at an affordable cost , irrespective of sex, ethnic, social or any other background nor financial or health status.

• Primary coverage • Predominantly public

funding • Compulsory

(opting out not allowed)• Broad benefit basket• Access (and resource

allocation) based on need (not capcity to pay)

29

Minimum levelof care

Equalityin access to care

Universality continuum

Emergency care

Basic benefit basket

Positive selectivitymeasures

Access to healthcare services (the filter model)

Population coverage

Content of the benefit basket

Cost-sharing arrangements

Geographical factors

Preferences

Organisational barriers

Choice among available providers

1

2

3

4

5

6

7Busse et al. 2007

50

3,4

10

2,5

10

4

10

6,9

5

5,6

5

8,8

5

15,6

5

53,2

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

% of population % of expenditure

The well-known 20/80 distribution –actually the 5/50 or 10/70 problem

How can we predictwho these 5 or 10% are?

32

Fragmentation of pooling limits insurance potential of public funds

Source: J. Kutzin, WHO EURO

Complementary (user charges)

Complementary (services)

Supplementary

Mixed complementary/supplementary

0

5

10

15

20

25

SV

K

BG

R

ES

T

CZ

E

SW

E

LTU

PO

L

LVA

HU

N

ITA

UK

LUX

DN

K

MLT

GR

C

FIN

BE

L

PR

T

CY

P

RO

U

ES

P

IRL

AU

T

GE

R

SV

N

FR

A

NLD

Substitutive

Private health insurance as a proportion of total expenditure on health, 2005

Source: WHO 2007

The new Dutch basic health insurance:

a social insurance with private mechanisms or

a private insurance with social safeguards?

Employer

Government

Insured Insurer

Pooling fund

Healthcare allowance(means tested)

Income-relatedcontribution 50%

Tax contribution 5%

Flat-rate premium 45%

average: 1000€ p.a.

Annual deductible of 150€

Risk equalisation

payment

35

The basic health insurance in the Netherlands:balancing between

competition and solidarity

• Nationally operating privatehealth insurers(profit – not-for-profit)

• Free choice of insurer

• Nominal premium

• Collective contracts (-10%)

• Product choice:– In kind – reimbursement

– Deductibles (150-500€)

• Complementary insurance

• Insurance obligation

• Uniform basic package

• Obligation to insure

• Prohibition of risk rating

• Premium subsidy for lowerincomes

• Income-related

(employers)contribution + public

funding of aged -18

• Statutory system of risk

structure compensation

• Catastrophic illnesses excluded

(AWBZ)

36

Universalisation of SHI systems

• From mandatory insurance to mandate to insure (NL, D) – Corollary: obligation to accept subscribers– Operating choice?

• Increasing solidarity-base – lifting contribution ceilings, extending scope, restricting opting

out (F, D)

• Abolishing waiting periods• Aligning cover for different schemes, groups (B, IRL)• Eligibility based on residence (F, LTV, etc.)

– F – basic universal coverage (CMU): residual category

• State-funding of certain groups (non-active) – Children, pensioners, unemployed, students, social assistance,

etc..

37

Defaulters

• Stabilising SHI right (D, F, B): annual right, revert to last insurance

• Collection: monitoring payment of contributions• Small insurance base may impede on willingness to

contribute (BLG, ROM)• Enforcement policies (CH, NL)

– Administrative fines, claim back premium subsidies– Suspend cover, deny care

• Disentangling entitlements to care from payment of contributions (HUN)– Recuperation through taxes

38

Migrants (assylum seekers, illegalresidents, internal migrants)

• Special schemes (D, F for illegals): Often restricted to emergency - essential care

• Integration in general scheme (F for assylum seekersafter 3 months)

• Socially excluded groups– Administrative as well as language and cultural barriers,

discrimination– Special health centres– Use of health mediators– Important role for local authorities, social assistance bodies

39

Service and cost coverage

• Definition of services (benefit basket)– Most cited gaps: dental and mental care

• Level of coverage (cost sharing)– Generalisation of user charges (D)– Regressiv: increasing inequalities in access– no evidence of efficiency gains or LT cost savings– Different types: co-insurance, co-payment, deductibles, extra billing,

informal payments• Conditions and modalities (incl. type of provider)• Procedure for inclusion of new treatments (e.g. HTA)

• Margin for purchasers?– Package and co-pay design– Treatment models– Complementary insurance

40

Access problems due to financialdifficulties in Poland (2000-05)

36

38

15

25

13

11

22

3

34

30

15

17

9

11

17

2

33

31

17

15

8

10

14

2

0 10 20 30 40 50

medicines

dental care

dental prosthetics

physicians visits

medical examinations

rehabilitation

sanatorium

hospital

% gospodarstw domow ych

2005r.

2003 r.

2000 r.

Latvia (2005): even with universalcoverage access problems can persist

Xu K, Saksena P, Carrin G, Jowett M, Kutzin J, Rurane A, 2009

42

Out-of-pocket expenditure: protection mechanisms

• User charge exemptions– Age (children, elderly) – Social status– Health status (e.g. pregnancy, chronic illness)– Income level

• Exemption treshold (OOP ceiling), but– Scope? – Uniform or income-related?

• Preferential reimbursement• Extra billing prohibition + third party payer

Latvia (2006): average household OOP per month per quintile

Xu K, Saksena P, Carrin G, Jowett M, Kutzin J, Rurane A, 2009

Catastrophic expenditure

Changes in financial protection following a change in priorities

(Estonia)

Source: Habicht et al. (2006). “Detecting changes in financial protection: creating evidence for policy in Estonia.” Health Policy and Planning 21(6): 421-31.

Percent of households impoverished by out-of-pocket health spending

1.0%

1.3%1.4%

0.0%

0.3%

0.6%

0.9%

1.2%

1.5%

1995 2001 2002

Per

cent

of h

ouse

hold

s

Percent of households incurring high level of out-of-pocket spending

3.4%

6.4%

7.4%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

1995 2001 2002

Per

cent

of h

ouse

hold

s

46

Private health insurance

• Substitutive insurance– Life-insurance rules (age-at-entry rating) + transferability of age

reserve (D)– Legally fixed substitutive basic tarif (D)

• Complementary insurance– Open enrolment/life-long insurance/premium regulation

(IRL, SVN, B)– Risk adjustment system (IRL, SVN)– Free complementary health insurance + voucher system (F)– Tax credits only for contracts with social safeguards (F)

• Prohibition of re-insurance (D, F)• Informal payments?• Solidarity with statutory system?

47

Comparison of health status and access to health care among privately and publicly insured people in Germany, 2001-2005

26

47

81

21

23

22

Public (%)

11People aged 65+*

7Difficulties in paying for OP prescription drugs**

45Specialist contact (OP)

55GP contact**

9Self-reported poor health**

11Chronic disease**

Private (%)Prevalence of:

Sources: Mielck and Helmert 2006 and *Schneider 2003

** Statistically significant after controlling for differences in age, gender and income

483

4

5

6

7

8

9

10

11

12

1970 1980 1990 2000 2010 2020

AustriaBelgiumDenmarkFinlandFranceGermanyGreeceIrelandItalyLuxembourgNetherlandsNorwaySpainSwedenSwitzerlandUnited KingdomEU members before May 2004 Eur-A

Total health expenditure as % of gross domestic product (GDP)

49

Solidarity vs. sustainability?• Financial protection and equity of finance are key

– Universal access and solidarity central in most European systems– Solidarity (integration, financing, benefits)

• Trade-off: macro-economic context (constraints)– Collecting capacity– Health as priority in public financing– Increasing financial pressure (cost, public finance s)– Looking for efficiency gains/savings

• Issues– Increasing role for out of pocket (with exemptions and

ceilings) and for private voluntary insurance– Fragmentation of pools

50

Public health expenditureas % of GDP

Source: WHO

0

1

2

3

4

5

6

7

8

9

10

Cyp

rus

La

tvia

Est

on

ia

Bu

lga

ria

Po

lan

d

Ro

ma

nia

Lith

ua

nia

Slo

vaki

a

Gre

ece

Ma

lta

Hu

ng

ary

Slo

ven

ia

Sp

ain

Cze

ch R

ep

ub

lic

Fin

lan

d

Ire

lan

d

Lu

xem

bo

urg

Italy

Be

lgiu

m

Po

rtu

ga

l

Un

ited

Kin

gd

om

Sw

ed

en

Ne

the

rlan

ds

Au

stria

Ge

rma

ny

Fra

nce

De

nm

ark

1997 2007

51

General public expenditureas % of GDP

Source: WHO

0

10

20

30

40

50

60

70

Slo

vaki

a

Est

onia

Latv

ia

Lith

uani

a

Irel

and

Rom

ania

Luxe

mbo

urg

Spa

in

Cyp

rus

Bul

garia

Pol

and

Mal

ta

Slo

veni

a

Uni

ted

Kin

gdom

Ger

man

y

Cze

ch R

epub

lic

Net

herla

nds

Por

tuga

l

Fin

land

Italy

Aus

tria

Bel

gium

Hun

gary

Den

mar

k

Fra

nce

Sw

eden

Gre

ece

1997 2007

52

Health expenditure as % of total public expenditure

Source: WHO 2007

0

2

4

6

8

10

12

14

16

18

20

Cyp

rus

Latv

ia

Pol

and

Bul

garia

Gre

ece

Rom

ania

Hun

gary

Est

onia

Lith

uani

a

Fin

land

Cze

ch R

epub

lic

Slo

veni

a

Mal

ta

Italy

Sw

eden

Bel

gium

Slo

vaki

a

Por

tuga

l

Spa

in

Aus

tria

Uni

ted

Kin

gdom

Fra

nce

Net

herla

nds

Luxe

mbo

urg

Irel

and

Ger

man

y

Den

mar

k

1997 2007

53

Different health prioritiesin a similar fiscal context

Source: adapted from Kutzin 2008; WHO data for 2007

6.716.552.4France

20.411.835.5Estonia

11.617.236.4Ireland

45.97.040.3Cyprus

11.616.344.1UK

11.913.544.9Czech Republic

Out-of-pocket spending as % of

total health spending

Public health spending

as % of total public spending

Total public spending

as % of GDPCountry

54

Priority to health in the government budget

Source: WHO estimates for 2004

0

5

10

15

20

Az e

rba i

jan

Ta j

i ki s

t an

Geo

r gi a

Arm

e nia

Cy p

r us

Uz b

e kis

tan

Ru

s si a

L atv

iaA

l ba n

iaK

y rgy

z st a

nP

o lan

dU

kra i

ne

Gre

e ce

Au s

t ria

Be l

a ru

sK

a za

k hst

a nB

u lg a

ria

Ro

ma

n ia

I sr a

elF

i nl a

ndM

o ld o

v aE

sto n

i aB

o sn

ia- H

erz

Hu

n ga r

yN

eth

e rl a

n ds

Slo

v aki

aT

u rk m

e nis

tan

Be l

g ium

De

nma r

kIta

lyL u

x em

b our

gS

p ai n

Se r

bia

Slo

v eni

aP

o rt u

gal

Mal

taF

r anc

eS

wed

e nT

urke

yC

roa t

i aC

z ec h

Re p

L it h

u an i

aU

KI r

e la n

dF

YR

Ma

c ed

onia

Ger

ma n

yN

or w

ay

Ice l

and

Sw

itze r

l an d

Hea

lth a

s %

of t

otal

gov

ernm

ent s

pend

ing

55

Why it’s important: public spending on health matters (for our objectives)

AZE

TJK

GEO

ARM

KAZ

KGZ

UZB

TKM

ALB

LVA

RUSUKR

ROU

MDABGR

EST

POL

BIH

BLRLTU

GRC

AUT

SVK

TUR

ESP

FIN

MKD

HUN

ISR

NLDLUX

BELITA

HRV

SVN

PRTCHE

CZEGBR

SCGMLTDNK

FRA

SWENOR

DEU

ISL

CYP

IRL

R2 = 0.80

0%

10%

20%

30%

40%

50%

60%

70%

80%

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0%

Public spending on health as %GDP

OO

PS

as

% to

tal h

ealth

spe

ndin

g

The more that governments spend on health, the lower the burden of out-of-pocket spending on their population (with variation: policy matters too!)

Source: WHO estimates for 2003, European Member-States w population > 600,000

56

Out-of-pocket payments as % of total health expenditure (2002)

FYROM, 15Croatia, 19

Belarus, 26Ukraine, 29

Turkey, 34Romania, 34

Serbia, 38Moldova, 42

Russia, 44Bulgaria, 46

BIH, 50Albania, 61

0 10 20 30 40 50 60 70

WHO / WB estimate 2005WHO / WB estimate 2005WHO / WB estimate 2005WHO / WB estimate 2005

Poverty still widespread in large parts

0 3 3 5 4 2 4 5 616

24

2 39

56

26

42

73 74

5

4955

12

2515

21 2621 19

2836

46

48

1928

33

34

45

44

23 22

69

35

37

0

10

20

30

40

50

60

70

80

90

100H

unga

ry

Pol

and

Latv

ia

Est

onia

Lith

uani

a

Bos

nia

TF

YR

Mac

edon

ia

Bul

garia

Ser

bia

Rom

ania

Alb

ania

Bel

arus

Ukr

aine

Rus

sian

Fed

erat

ion

Rep

ublic

of M

oldo

va

Kaz

akhs

tan

Uzb

ekis

tan

Kyr

gyzs

tan

Taj

ikis

tan

Aze

rbai

jan

Geo

rgia

Arm

enia

CEE5 BALTICSTATES

SOUTH-EASTERN EUROPE WESTERN CIS CENTRAL ASIA CAUCASUS

Above US$ 2.15 but below US$ 4.30

Below US$ 2.15 a day

Source: Alam et al. (2005)

Absolute poverty rates (%), around 2003

58

Monitoring and analysis

Emphasis on vulnerable populations

• Homeless• Irregular employment• Migrants• Ethnic minorities• Refugees• Addicts (alcohol, narcotics)• Sex workers

59

Strengthening social safety nets

• Ensuring protection from catastrophic expenditure

• Tackling informal payments, especially where they are regressive

• Ensuring benefit systems respond rapidly when people become unemployed

• Ensuring affordability of pharmaceuticals– Especially where

currency depreciations increase price

– Especially for people with chronic illness

– Tackling profiteering and counterfeit drugs

– Transferring taxes on drugs to taxes on tobacco (or airline tickets?)

60

HiAP: intersectoral action on health determinants

• The entry point for Health in All Policies– The so called determinants

of health influence the health of the population and individuals

– Changes in the determinants may result in changes in the health of the population and individuals

– Some determinants are amenable to policy changes! (Dahlgren and Whitehead 1991)

Health is wealth: the virtuous circle

wealthhealthsickness poverty

AnalysingHealthSystems and Policies

Thank youfor

your attention

http://www.euro.who.int/observatory