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Financing Sustainable Healthcare in Europe: New Approaches for New Outcomes

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Financing Sustainable Healthcare in Europe: New Approaches for New Outcomes FINANCING SUSTAINABLE HEALTHCARE IN EUROPE: NEW APPROACHES FOR NEW OUTCOMES Conclusions from a collaborative investigation into contentious areas of healthcare February 2007 “Financing Sustainable Healthcare in Europe” presents the results of a year-long study into the sustainability of healthcare financing in Europe which was first proposed in Luxembourg in late 2004. It is endorsed by Luxembourg's Ministry of Health and by Sitra, the Finnish Innovation Fund, and is partnered by Pfizer, Inc. The views expressed in this work are those of the authors and do not necessarily represent the views and policies of the organisations to which they belong. The independence of the authors, and of all other parties who contributed to this work, is absolute. Pfizer’s intention in partnering this initiative was to stimulate novel thinking and to contribute to finding solutions for sustainable healthcare financing in Europe. TABLE OF CONTENTS Steering Committee 4 Rapporteurs 5 Contributors 5 Introduction to the report 7 Dr. Otto Graf Lambsdorff Setting the Scene 9 Pat Cox 1 Protecting equity while improving efficiency: Some possibilities for expanding the role of competition and choice in health care delivery 13 Jacques Cremer, Jean-Marie Lozachmeur (IDEI, University of Toulouse) Stephen Wright (European Investment Bank) 2 Ensuring value for money in health care: The role of HTA in the European Union 45 Corinna Sorenson, Panos Kanavos (LSE Health and Social Care) Michael Drummond (University of York) 3 Patient empowerment and efficient health outcomes 139 Reinhard Angelmar (INSEAD) Philip C. Berman (European Health Management Association) 4 Issues affecting the sustainability of health financing in several countries of south east Europe 163 Pia Schneider (The World Bank) FINANCING SUSTAINABLE HEALTHCARE IN EUROPE STEERING COMMITTEE The Steering Group had the role of guiding and overseeing the progress of the investigation. • Pat Cox (Chairman) Chairman of the European Movement; past President of the European Parliament • Claude Hemmer Chief Advisor to the Minister of Health of Luxembourg • Hannu Hanhijärvi Executive Director, SITRA Healthcare Programme, Finland • Jack Watters Vice President for Medical & Regulatory Affairs, Pfizer • Rob Walton Senior Director Public Affairs Europe, Pfizer • Stephen Wright Associate Director, Human Capital Division, European Investment Bank • Jacques Crémer Director, Institut de l’Economie Industrielle, Toulouse University • Panos Kanavos Lecturer in International Health Policy and Research Fellow, London School of Economics • Reinhard Angelmar Professor, INSEAD • Philip C. Berman Director, European Health Management Association • Pia Schneider Economist, The World Bank • Marilyn Clark (Secretary) Director, FIPRA Luxembourg 4 RAPPORTEURS • Protecting equity while improving efficiency: some possibilities for expanding the role of competition and choice in health care delivery Jacques Crémer, Director, Institut de l’Economie Industrielle, Toulouse University Stephen Wright, Associate Director, Human Capital Division Capital Division, European Investment Bank • Ensuring value for money in health care: the role of HTA in the European Union Corinna Sorenson, Panos Kanavos, LSE Health and Social Care Michael Drummond, University of York • Patient empowerment and efficient health outcomes Reinhard Angelmar, INSEAD Philip C. Berman, European Health Management Association • Issues affecting the sustainability of health financing in several countries of south east Europe Pia Schneider, The World Bank CONTRIBUTORS The Steering Committee would like to acknowledge with many thanks the contribution of the following experts to their investigation: • Dr. Anna Dixon • Dr. Jo Ellins • Dr. Chris Ham • Jan Hewitt • Dr. Albert Jovell • Dr. Patrice Korjenek • Dr. Joe Kutzin • Dr. Esteban de Manuel • Dr. Miroslav Mastilica • Dr. Elias Mossialos • Dr. Frans Rutten • Nicole Tapay, JD • Dr. David Taylor 5 FINANCING SUSTAINABLE HEALTHCARE IN EUROPE 6 INTRODUCTION TO THE REPORT Financing Sustainable Healthcare in Europe Dr. Otto Graf Lambsdorff It is no secret that health and welfare systems around the world are facing enormous challenges in meeting the increasingly conflicting objectives of providing wide accessibility and efficiency while delivering high quality and choice in healthcare. The historically generous social welfare systems of most North and Middle European countries have played vital roles in alleviating poverty and raising the standard of living and life expectancy. Yet even these national icons of social consciousness are struggling to meet the needs of a changing society – and health systems are finding new ways to provide healthcare, safeguard access and increase choice, while staying true to their principles of quality, equity and solidarity. Importantly, there is a growing understanding that healthcare systems cannot be isolated from the rest of society and economy: in order to be more effective they must interact within other areas including but certainly not restricted to, education, employment, pensions, social welfare, science and competitiveness.This almost certainly means that for public financing of healthcare to be sustainable, policy makers and citizens alike must see the broader landscape in which public health is situated and understand its contribution to our society in a much wider social, political and economic context. As the healthcare arena becomes more and more complex, the population ages and the cost of technology increases, the efficient provision of healthcare within a globalized economy is more important than ever before. While public financing – by taxes or wages-related social contributions – is still the primary source of healthcare funding in Europe it is by no means the only one. Out-of-pocket spending varies widely but has increased in most OECD countries since 1990, indicating there are financial barriers to access to healthcare that need to be monitored. Some Member States of the European Union have introduced innovative forms of financing through partnerships between the public and the private sector to develop healthcare infrastructure. Others have even worked with the private sector to provide public/private health insurance programs. Increasingly, it is clear that Europeans are finding new and innovative means to safeguard citizens’ right to access, high quality and affordable healthcare. However, only by delivering true innovation in development and implementation of public policy can we ensure that those who are positioned to do so, are equipped to make the right decisions for our society, our health and our future. It is widely accepted that in order for Europe to rise to the challenges and opportunities posed by globalization we must become more competitive. In the face of an ageing population, any future improvement in competitiveness will be also dependent on our ability to maintain a healthy and productive older working population. This crucial variable is ultimately reliant on our ability to provide high quality and effective healthcare, promoting prevention for an ageing society and reducing the economic burden of illness. A first step therefore must directly relate to ensuring health service provision is continuously efficient, readily accessible and meaningfully accountable. Attainment of this position undoubtedly entails strengthening the transparency, flexibility and competitiveness of our healthcare systems and frameworks. 7 FINANCING SUSTAINABLE HEALTHCARE IN EUROPE The report ‘Financing Sustainable Healthcare in Europe’ materialized as a result of the broad and inclusive collaboration of parties with an interest in ensuring the future provision and delivery of high quality healthcare for the people of Europe. Initially agreed during a highly successful conference of the same name, hosted by the Minister of Health of the Grand Duchy of Luxembourg in October 2005, the report synthesizes much of the knowledge and experience base of policy makers, academics, professionals, and experts in their respective fields, all of whom share a common passion for improving healthcare. Its key contribution is the generation of policy options for the delivery of continuous healthcare improvement through increased efficiency, enhanced choice and innovative models of healthcare financing. ‘Sustainable Financing of Healthcare in Europe’ has four specific areas of focus, each guided by leading organizations in their field of expertise. The University of Toulouse and the European Investment Bank provided clear insight by leading a work stream to consider ‘Protecting equity while improving efficiency: Some possibilities for expanding the role of competition and choice in health care delivery’. Similarly INSEAD and the European Health Management Association addressed the issue of ‘Patient empowerment and efficient health outcomes’, the London School of Economics led a work stream on ‘Ensuring value for money in health care: The role of HTA in the European Union’, and the World Bank guided the project on ‘Issues affecting the sustainability of health financing in several countries of south east Europe’. Rather than depending on the development of entirely new research, ‘Sustainable Financing of Healthcare in Europe’ aims instead to provide new analysis and thinking on the basis of existing work. In this way the collaboration of rapporteurs builds on a quantity of data and opinion to guide healthcare decision makers through an undoubtedly complex area of public policy terrain. Throughout
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