fiscal challenges of health care - oecd - health care - g. van... · 2016-03-29 · fiscal...
TRANSCRIPT
Fiscal Challenges of Health Care
9th Annual Meeting of OECD-Asian Senior Budget Officials
Bangkok, 14 December 2012
Geert van Maanen
Secretary-General, Ministry of Health, Welfare and Sport
The Netherlands
Agenda
• Development of Health Care Expenditures
• Myths About Health Care Expenditures
• Future OECD Work on Health Care Expenditures
Steady growth of public Health + LTC spending
Public Health and LTC expenditure as a % of GDP, OECD countries
3 Source: OECD Health database (2011).
What drives health care expenditure?
Health care expenditure
Demography Income Residual
Relative prices
Technology Institutions and policies
An income elasticity of 1.8
could explain most of the
expenditure growth
If price elasticity is low then price effect
on expenditures could be important
4
Agenda
• Development of Health Care Expenditures
• Myths About Health Care Expenditures
• Future OECD Work on Health Care Expenditures
More competition will
improve value for money
More patient choice will
transform health care
More co-payments
will reduce waste
Spending more on
prevention will save
us money in the long
run
Regulating technology is a means
of reducing spending
Five common myths about health policies
Myth 1: More competition will
decrease health costs
More co-payments
will reduce waste
Spending more on
prevention will save
us money in the long
run
Regulating technology
is a means of reducing
spending
More patient choice will
transform health care
Competition in which market?
Evidence from competition in insurance
• No evidence that insurance competition drives down costs:
– Why would it? Risk adjustment, set benefits, group contracting… What scope is there?
– Market concentration
Competition in provision
Conditions for market incentives to work for core services:
1. Financial support rewards more efficiency
2. Selective contracting possible
3. Feasible alternative suppliers with capacity
4. Information available, especially quality
• MYTH: More competition will decrease health costs
• REALITY: Competition in provision might increase efficiency; competition in insurance won’t.
Myth 2: More patient choice will
make providers compete on quality
More co-payments
will reduce waste
Spending more on
prevention will save
us money in the long
run
Regulating technology
is a means of reducing
spending
Competition in provision might
increase efficiency;
competition in insurance won’t.
Apparently great interest in
rankings…
Conditions for patient choice to
make a difference
patients act as informed
consumers
GPs act as agents of choice
providers respond to
market signals
Convergence towards ‘managed
choice’
• COUNTRIES WITH NO CHOICE EXPANDING IT
– Finland
– Sweden
– UK.
• COUNTRIES WITH CHOICE INTRODUCING GATEKEEPING
– France
– Germany
– US (HMOs/Medical Homes)
Myth 3: More co-payments will
reduce waste
Spending more on
prevention will save
us money in the long
run
Competition in provision might
increase efficiency;
competition in insurance won’t.
Patient choice is
valued, but does not
promote efficiency
Regulating technology is a means of
reducing spending
Out-of-pocket payments account for nearly 20% of total
health spending (2008)
49.3
35
30.8
29
.7
25.2
23.9
22.9
22.4
21.8
20.7
20.5
19.7
19.5
19.4
18.8
18
16.6
15.7
15.6
15.1
15.1
14.7
14.6
14.4
13
.9
13.8
13
12.8
12.1
11.6
11.1
7.4
5.7
0
10
20
30
40
50
60
Mexiq
ue
Coré
e
Suis
se
Isra
ël*
Rép. slo
vaque
Hongri
e
Port
ugal
Polo
gne
Turq
uie
Espagne
Belg
ique
Esto
nie
Italie
Fin
lande
OC
DE
Austr
alie
Isla
nde
Rép. tc
hèque
Suède
Norv
ège
Autr
iche
Canada
Japon
Irla
nde
Nouv.-
Zéla
nde
Danem
ark
Alle
magne
Slo
vénie
Eta
ts-U
nis
Luxem
bourg
Royaum
e-U
ni
Fra
nce
Pays
-Bas
Myth 4: ‘more co-payments will reduce
waste’
• More than 130 studies of the impact of copayments on drug consumption:
– Reduce consumption of non-essential medicines
– But also reduces consumption of essential medicines
– No convincing evidence on long-term health effects
– Effects on spending are at best temporary
• Studies on other types of care (consultations, use of emergency services…)
– Reduction in usage, but often only temporarily
– Substitution towards other type of care – but often not evaluated
– No convincing evidence of effects on spending
• MYTH: More co-payments will reduce waste
• REALITY: Co-payments shift spending, but probably don’t reduce it
Myth 4: Regulating technology is a
means of reducing spending
Spending more on
prevention will save
us money in the long
run
Competition in provision might
increase efficiency;
competition in insurance won’t.
Patient choice is
valued, but does not
promote efficiency
Co-payments shift spending, but probably
don’t reduce it
EBM HTA
CLINICAL
GUIDELINES
PATIENT
LEVEL
DECISION
MAKING
COVERAGE
DECISION
MAKING
DOES IT WORK ? IS IT WORTH IT ?
Rational decision making about
technologies and practices
Consumption of anticholestorols (daily doses per 1000 people)
0
50
100
150
200
250
Germany Australia
2000
2007
• MYTH: Regulating technology is a means of reducing spending
• REALITY: HTAs have increased health, increased value for money, but also increased spending
Myth 5: Spending more on
prevention will save us money in
the long run
Co-payments shift
spending, but
probably don’t
reduce it
HTAs have increased
health, increased value
for money, but also
increased spending
Competition in provision might
increase efficiency;
competition in insurance won’t.
Patient choice is
valued, but does not
promote efficiency
Overweight and obese: a Growing
Problem
20%
30%
40%
50%
60%
70%
80%
1970 1980 1990 2000 2010 2020
Pro
po
rtio
n o
verw
eigh
t (a
du
lt p
op
ula
tio
n)
Year
USA England
Spain
Austria
France
Australia
Canada
Korea
Italy
Financial Impact -15000-10000-5000500010000
Intervention costs and savings
-50
50
150
250
350
450
550
Co
st
(bil
lio
n $
PP
P)
intervention costs
health expenditure
• MYTH: Spending more on prevention will save us money in the long run
• REALITY: Prevention spending is cost-effective, not cost reducing.
The 5 realities: Health is
complicated…
Co-payments shift
spending, but
probably don’t
reduce it
HTAs have increased
health, increased value
for money, but also
increased spending
Competition in provision might
increase efficiency;
competition in insurance won’t.
Patient choice is
valued, but does not
promote efficiency
Prevention spending is cost-
effective, not cost reducing.
Agenda
• Development of Health Care Expenditures
• Myths About Health Care Expenditures
• Future OECD Work on Health Care Expenditures
Joint OECD Health Sustainability Network
• The OECD has recently launched a Joint Network
bringing together finance officials from health ministries
and budget examiners responsible for health care
expenditure.
• This Joint Network responds to the growing recognition
that improved dialogue and concerted action is needed
among these communities in order to better understand
and manage rapidly growing health expenditures.
• Interest in launching such a Joint Network in the Asian
region as part of Asian SBO.
Benefits for SBO
• A new approach to addressing ‘intractable’ fiscal sustainability challenges, e.g. improving expenditure management, aligning cost control incentives
• Practical (rather than academic) focus: case studies, what has worked and why?
• Institutional perspective: inter-ministerial dialogue & co-operation; health systems characteristics survey
• Better use of data & analysis: health accounts, value for money evaluations, public expenditure reviews, fiscal projections, health expenditures drivers
Thank you.