national health accounts - michael müller, oecd

INFORMING POLICY WITH HEALTH ACCOUNTS

Michael Müller, OECD Health Division

2nd HEALTH SYSTEMS JOINT NETWORK MEETING FOR CENTRAL, EASTERN AND SOUTHEASTERN EUROPEAN COUNTRIES Tallinn, 1-2 December, 2016

Health Accounts –What is it?

Early and country specific efforts

Develop-ment of

NHA methods

• First HA standard; base for NHA “Producers Guide”; Disease-based accounts

SHA 2011

SHA 1.0

• Joined Global Standard; legal framework in EU

• Country studies; US National Health Accounts

• System of National Accounts (SNA); OECD Health Data

Who pays?

What services?

Who provides

?

Framework to measure health spending and financing

History:

SHA 2011 Framework

Current Health

Spending

Consumer health interface

Financing interface Provision interface

Functions ICHA-HC

Financing schemes ICHA-HF Providers ICHA-HP

Characteristics of beneficiaries (Disease, age, gender, income, etc.)

Financing Agents ICHA-FA Revenues of Financing Schemes ICHA - FS

Factors of Provision ICHA-FP External trade

Gross capital formation

non-health expenditure

Health-related expenditure

Current health spending

MOH

Boundary definition

Presenter

Presentation Notes

tri-axial relationship everything that is financed is produced and everything that is produced is consumed can provide much more details in each for these three areas more in depth analysis depends on needs of countries undertake more specific analyses cross tabs betweens the three areas

PURPOSES OF HEALTH ACCOUNTS

4

Health accounts sits at the centre of health system analysis

Health Accounts

Quality of services

Accessibility

Equity of utilisation

Efficiency of the

system

Transparency and

accountability

Innovation

Health

Equity in health

Financial risk protection

Responsiveness

Governance stewardship

Resource

generation human, physical, and knowledge

Financing collecting,

pooling and purchasing

Service delivery

personal and population-based

Health system functions

Instrumental objectives

Ultimate objectives

Health care

Consumption

Financing Provision

Source: SHA 2011

The main purposes of SHA

To define harmonised boundaries of health care for tracking expenditure on consumption

HEALTH CARE

Prevention and Public Health

Long-term Care

Medical goods

Outpatient care

Inpatient care

To provide a framework of the main aggregates relevant to international comparisons of health expenditures and health systems analysis

Administration

To provide a tool, expandable by individual countries, which can produce useful data in the monitoring and analysis of the health system

Presenter

Presentation Notes

Link between health accounts and health system analysis What information can health accounts provide? Internationally comparable data on the overall level and growth and composition of spending on health care To what extent can health accounts help in answering policy questions? Benchmarking policies Financial sustainability (for types of schemes & health system) Factors that drive growth in health spending Evaluation of reforms and impact of governance changes (e.g. decentralisation)

Assuring internationally comparable data

Source: OECD Health Statistics 2015

16.4

11

.1

11.1

11

.0

11.0

10

.9

10.4

10

.2

10.2

10

.2

10.1

9.

9 9.

5 9.

2 9.

1 9.

1 8.

9 8.

9 8.

9 8.

8 8.

8 8.

8 8.

7 8.

7 8.

6 8.

5 8.

1 7.

6 7.

5 7.

4 7.

3 7.

1 6.

9 6.

8 6.

6 6.

5 6.

4 6.

2 6.

1 6.

0 5.

6 5.

3 5.

1 4.

0 2.

9

0

2

4

6

8

10

12

14

16

18% GDP Public Private

21 19 18 18 18

16 16 16 15 15 15 15 14 13 13 12 12 12 12 12 12 12 11 11 10 10 10 9 6

22

17 16

14 13 11 9

8

0

5

10

15

20

25% total government expenditure

Presenter

Presentation Notes

Key health spending indicators comparing across OECD and in regions (e.g. Europe, Asia Pacific)��

16 January 2000 TONY BLAIR: ...then at the end of that five

years we will be in a position where our Health Service spending comes up to the average of the European Union, it’s too low at the moment so we’ll bring it up to there.

DAVID FROST: Bring it up to there by when?

TONY BLAIR: At the end of that five year period, in other words if…

DAVID FROST: Five years from today not five years from the next election, five years from…

TONY BLAIR: No five years from the end of this financial year,...

Simple comparisons of aggregates used for benchmarking!

United Kingdom

EU-15

5

5.5

6

6.5

7

7.5

2000 2001 2002 2003 2004 2005 2006 2007 2008

Public spending on health (%of GDP)

Health Spending Analysis: OECD average as a starting point for comparative analysis to show the trend in health spending

-1%

0%

1%

2%

3%

4%

5%

6%

2001 2004 2007 2010 2013

OECD OECD (EU) OECD (non-EU)

Average annual growth in total health expenditure per capita, in real terms, 2001 to 2013


Presenter

Presentation Notes

What has happened to health spending growth since the start of the crisis …? Across OECD, the growth rate dropped dramatically. Driven primarily by cuts in public spending which accounts for three-quarters of health spending on average

Average OECD health expenditure growth rates in real terms

Health Spending Analysis: Country level data point to large variations across OECD countries and direction for further investigation

5.4

-0.4

5.3

1.3

3.5

0.5

3.4

0.4

3.2

5.4

3.6

3.5

6.7

3.2 3.4

11.3

4.1

-2.3

1.5 2.

2

1.7

5.0

1.9

1.7 2.

3

3.3

1.7

2.9

2.8

8.4

1.3 1.

9

3.2

9.0

5.9

-7.2

-4.3

-4.0

-3.0

-1.7

-1.6

-0.8

-0.4

-0.3

-0.2

-0.1

0.3

0.3 0.5

0.6

0.6

0.6 0.8

0.9 1.0

1.0 1.2

1.2

1.3 1.5 1.7

1.7 2.0

2.0 2.3 2.5

3.6 3.9

5.4

6.4

-10

-5

0

5

10

152005-2009 2009-2013


Presenter

Presentation Notes

Following the economic crisis, average OECD health expenditure growth rates in real terms dropped to close to zero highlighting that countries are under pressure to contain costs. While cuts in health spending was strongly related to those countries hardest hit economically i.e. in Europe, countries outside Europe area continues to see health exp growth – albeit reduced.

Health Spending Analysis: Breaking spending down by components can start to tell a story

Average growth by main function per capita, OECD average, 2005-2013, in real terms

-3%

-2%

-1%

0%

1%

2%

3%

4%

5%

6%

7%

Inpatient care Outpatient care Long-term care Pharmaceuticals Prevention Administration

2005-09 2009-13


Presenter

Presentation Notes

SHA can be broken down by function enabling more in-depth analysis of reduction in spending by different component of health sector. Pharma and prevention easier ‘political targets’ for cuts But not good for FS (prevention) and accessibility (pharma)… important to prioritise & find strategic savings Furthermore, applying a survey result on policy priorities reveals the disconnection between priorities and reality.

SHA plays key role in monitoring financial sustainability US

AGR

EECE

CAN

IREL

AND

FRA

BEL

DEU

JPN

ITA

ESP

PRT

AUT

AUS

CHE

SVK

SWE

ISL

HUN

FIN

SVN

LUX

NOR

KOR

GBR

CZE

DNK

POL

NZL

EST

MEX

200

400

600

800

Per capita spending in USD PPP, 2007

Presenter

Presentation Notes

Pre-crisis, spending on pharmaceuticals in Greece was second only to the US… The implementation of SHA and the reporting of Greek health spending estimates to OECD-EU-WHO was one of the commitments under the Financial Stability Pact. Health spending figures for greece compared to other OECD showed where possible efficiency savings could be made. Subsequent cuts in the pharma bill equalled 3bn euros - a saving of 1% GDP

Health spending analysis: Evaluation of reforms and impact of governance changes

Average per capita inpatient expenditure growth rates (in real terms), OECD average, 2005-2011

0 1 2 3 4 5 6

General government/Social security

Private out-of-pocket

Private insurance

2005-07 2007-09 2009-11 2011-13

In %


Health spending analysis: Explaining factors that differentiate the level of health spending

0.53

0.60 0.57

0.47

0.53

0.81

0.70 0.67

0.64

0.54

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

0.90

1.00

Germany Switzerland Netherlands France Canada

Adjusted fordifferences ineconomy-wideprice levels

Adjusted fordifferences inhealth sectorprice levels

United States

Comparison of per capita health expenditure estimated using general price levels and health-specific price levels (United States=1), 2011

OECD analysis on comparative price levels in

health suggests prices rather than volumes contribute to

high US spending.

because of…

Intense use of health-related technologies, low productivity,

decentralised price negotiations, fragmentation in

the insurance market, high level of provider concentration

and weak price control

Presenter

Presentation Notes

Cited from Weathering the crisis: health care expenditure and health policy in the United States vs. other high-spending OECD countries. For LANCET. Reviewed SHA data of High-health spending countries – US, Canada, France, Germany, the Netherlands and Switzerland. Analysed a selection of national health policies which contributed in a significant way to shaping those trends.

Application of Health Accounts – spending by disease

0 10 20

CirculatoryDigestive

Mental healthMusculoskeletalNervous system

CancerEndocrine

RespiratorySymptoms

InjuriesGenitourinary

OtherfactorsInfectious

SkinPregnancyCongenital

BloodPerinatalExternal

GERMANY, 2008 0 10 20


RespiratoryCancer

MusculoskeletalNervous system

InjuriesInfectious

Mental healthGenitourinary

EndocrineSkin

SymptomsOtherfactors

PregnancyBlood

CongenitalPerinatal

KOREA, 2009 NETHERLANDS, 2011 0 10 20

Mental healthNot allocated


MusculoskeletalNervous system

CancerSymptoms

RespiratoryGenitourinary

EndocrineInjuries

PregnancySkin

InfectiousBlood

CongenitalPerinatal

Source: OECD Exp. by Disease, Age and Gender Database.

Presenter

Presentation Notes

Looking at the current health spending by disease, it shows that circulatory diseases represent the largest shares in Germany and Korea while spending on mental health far exceeds other disease groups in the Netherlands The major non-communicable disease (NCD) groups covering circulatory, digestive, muscular, cancer and mental health accounted for more than half of total health spending in these countries. Mental health, for example, presents an interesting case as the Netherlands spent more than 20 percent of health spending on mental care while Korea spent relatively low among these three countries. In the case of the Netherlands, it is known that these include inpatient and long-term care facility cost for the elderly. While Korea, it is a research question as to why this is so low.

Application of Health Accounts – forecasting, sustainability & equity

OECD comparative studies linking financing data from SHA with utilisation data to measure inequalities

Using Public Health Spending Data as a starting point to project spending growth

Presenter

Presentation Notes

Looking at the current health spending by disease, it shows that circulatory diseases represent the largest shares in Germany and Korea while spending on mental health far exceeds other disease groups in the Netherlands The major non-communicable disease (NCD) groups covering circulatory, digestive, muscular, cancer and mental health accounted for more than half of total health spending in these countries. Mental health, for example, presents an interesting case as the Netherlands spent more than 20 percent of health spending on mental care while Korea spent relatively low among these three countries. In the case of the Netherlands, it is known that these include inpatient and long-term care facility cost for the elderly. While Korea, it is a research question as to why this is so low.

SHA 2011: A FOCUS ON FINANCING

17

The SHA 2011 Financing Framework

Financingagent(FA)

Financingagent(FA)

Institutional units of the economy

providing revenues

Financingagent(FA)

Providers(HP)

Functions(HC)

Financingscheme

(HF)

Financingscheme

(HF)

Basic structural relationships of health financing

Money flow

• refined framework to mirror the evolution in financing and align with the financing functions of collection, pooling and purchasing

• Financing schemes and related financing agents

• The basic flows: (i) revenue-raising and (ii) allocation of resources

Health Care Financing: Main Questions SHA 2011 can help to answer

• How is financing in a country’s health care sector structured and how is it managed?

• How does a particular health financing scheme collect its revenues? • What is the extent of external funding? • Where does the money go? • How are the particular health care services or goods financed? • What share of the spending on inpatient care is covered by out-of-

pocket (OOP) payments? • How are the resources of the different financing schemes allocated

among the different groups of beneficiaries, such as by disease?

Revised classification of schemes and a focus on revenues

Classification of financing schemes (HF)

HF.1 Government schemes and compul. contrib. health care financing schemes

HF.1.1 Government schemes

HF.1.2 Compul. contrib. health insurance schemes

HF.1.2.1 Social health insurance

HF.1.2.2 Compulsory private insurance

HF.2 Voluntary health care payment schemes

HF.2.1 Voluntary health insurance schemes

HF.2.2 NPISH financing schemes

HF.2.3 Enterprise financing schemes

HF.3 Household out-of-pocket payment

HF.4 Rest of the world financing schemes

Classification of revenues of financing schemes (FS)

FS.1 Transfers from government domestic revenue

FS.1.2 … on behalf of specific groups

FS.1.3 Subsidies

FS.2 Transfers distributed by government from foreign origin

FS.3 Social insurance contributions

FS.3.1 ... from employees

FS.3.2 ...from employers

FS.3.3 ...from self-employed

FS.4 Compulsory prepayment (other than FS.3)

FS.5 Voluntary prepayment

FS.6 Other domestic revenues n.e.c.

FS.7 Direct foreign transfers

New Framework sheds better light on government involvement

Tracking revenues: Policy relevance

0%

25%

50%

75%

100%Other Soc. Ins. Contributions Govt. Transfers•Track diversification of revenue

sources for health financing e.g. away from payroll-based contributions in the face of changing demographics

•Refine definitions and improve overall country coverage to feed work on fiscal sustainability and expenditure forecasting

•Measure the full burden of government spending on health taking into account subsidies and transfers to other financing schemes

0102030405060

2000 2002 2004 2006 2008 2010 2012 2014

tril

lion

s Revenues Expenditures

NHA can help assessing health system performance

• Transparency and accountability - Where does the money come

from, who manages it and what is it used for ?

• Financial risk protection – levels of out-of-pocket spending /pre-

payments

• Accessibility and equity – by beneficiary characteristics with

other non-expenditure data (e.g. Utilisation)

• Efficiency – by function with data on activities, outcomes. But:

• NHA not an end in itself but should follow country priorities

• Insufficient on their own to assess programme interventions

• Cannot answer questions it is not designed to accommodate

Problems with budget process, formulation, execution? other instruments: PER, PETS

What information can health accounts provide?

• Internationally comparable data on the overall level and growth and composition of spending on health care

– International benchmarking

– Compare and relate spending with priorities

• Deeper analytic possibilities of

– how services are financed and provided

– Factors that drive growth in health spending

– Financial sustainability (for schemes & health system)

– tracking of domestic and external sources of financing

– Evaluation of reforms and impact of governance changes

– Achievement of Universal Health Coverage on regional level

• SHA 2011 is intended as a reference guide and a flexible toolkit

priorities and policy uses can differ and should be up to countries

Contact: [email protected]

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national health accounts - michael müller, oecd

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