relating microeconomic efficiency with macro-level productivity of the health care sector in the eu...
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Relating microeconomic efficiency with macro-level productivity of the health care sector in the EU Context
Akiko Maeda, Ph.D.Lead Health SpecialistThe World Bank Europe and Central Asia Region
Presentation Outline
Overview Defining “product” and “productivity” in health systemMeasurement tools and performance standards Critical role of health information systemsRelevance in the EU Context
Relating microeconomic efficiency with macroeconomic productivity in the health sector:
Health care is a significant and growing segment of the economy (7 to 14% of GDP in industrialized countries)Involves highly complex interactions among inputs, outputs and outcomes
Health, Health System and Growth
MacroeconomicGrowth
ImprovedHealth
Outcomes
Health System
Productivity
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
14.0
1970 1975 1980 1985 1990 1995
Year
Per
cent
of G
DP
Canada
FranceGermany
Japan
Sweden
U.K.USA
Percentage of GDP spent on Health, Seven OECD Countries 1970-1998
Total Health Spending in Europe as % GDP, 1990-1999
5.0
6.0
7.0
8.0
9.0
10.0
11.0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
Year
Pe
rce
nt
GD
P
Austria
Denmark
France
Germany
Greece
Italy
Netherlands
Portugal
Spain
Sweden
United Kingdom
Life Expectancy in Europe, 1990 - 1998
73.0
74.0
75.0
76.0
77.0
78.0
79.0
80.0
1990 1992 1994 1996 1998
Year
Lif
e E
xp
ec
tan
cy
at
Bir
th, i
n Y
ea
rs
Austria
Finland
France
Germany
Netherlands
Portugal
Spain
Sweden
United Kingdom
TToottaall HHeeaalltthh EExxppeennddiittuurree
%%GGDDPP
TToottaall HHeeaalltthh EExxppeennddiittuurree,,
UUSS$$
IInnffaanntt MMoorrttaalliittyy
RRaatteess UK 6.7 1,607 5.9 Japan 7.6 2,283 3.7 Sweden 8.4 2,146 3.6 Canada 9.5 1,828 5.5 France 9.6 2,358 4.7 Germany 10.6 2,769 4.8 US 13.6 4,178 7.2
OECD Health Spending & Health Outcomes, 1998
Health Outcomes and Health Spending
6
7
8
9
10
11
12
13
14
3 4 5 6 7 8
Infant Mortality Rate (per 1000 live births)
Hea
lth
Exp
end
itu
re a
s %
GD
P, 1
997
USA
Japan
Sweden
UK
France
Germany
Canada
better health outcome
Measuring Health Systems Performance: Measuring Health Systems Performance: inputs, throughputs and outcomesinputs, throughputs and outcomes
Revenues Revenues /Inputs/Inputs
• Redistribution Redistribution (Equity)(Equity)
• Administrative Administrative EfficiencyEfficiency
• Risk-pooling/ Risk-pooling/
InsuranceInsurance
Health Services Health Services ThroughputsThroughputs
• Allocative Allocative EfficiencyEfficiency
• Technical Technical efficiencyefficiency
• Efficacy/ Efficacy/ EffectivenessEffectiveness
Health Health OutcomesOutcomes
• Aggregate Aggregate
• Disease Disease specific specific
• Socio-Socio-economic economic factorsfactors
Critical performance indicators needed at all levelsCritical performance indicators needed at all levels
Complex Nature of Health Care System
Transformation of Health Care from a “cottage industry” comprising individual practitioners to a highly professionalized and technologically intensive service “industry”with rapidly evolving production and technological frontiers
Health care “production” process...
Multiple input factors Complex production process Complex production settingsComplex interaction with the environmentComplex definition of products, outcomes and benefits
Challenges to measuring health system performance
Many areas of uncertainty in productivity due to:
Lack of data Lack of consistent and comparable dataDifficulty in relating financial inputs with production outputs and health outcomes Difficulty in adjusting for quality, external factors
Challenges in measuring productivity in health care:
Establishing common standards and definitions for: “Products”, Production processes Relating these to Cost, Quality and Cost-effectiveness What measurement tools are available?
SOCIO-ECONOMIC CONTEXT
Social services,Environ-
mental policies,
Otherinter-
sectoralprograms
Health Care Production
Setting
managedcare,gate-keepingfunctions,continuityof care,...
Health CareServices
clinical practicedrugs, medical
technology, HRD
Public Health
Programs,Health
Promotion
Health Outcomes(e.g. QALYs)
R&D, Investments
Structure and Context of Health Care “Production” System..
SOCIO-ECONOMIC CONTEXT
Social services,Environ-
mental policies,
Otherinter-
sectoralprograms
Health Care Production
Setting
managedcare,gate-keepingfunctions,continuityof care,...
Health CareServices
clinical practicedrugs, medical
technology, HRD
Public Health
Programs,Health
Promotion
Health Outcomes(e.g. QALYs)
R&D, Investments
Structure and Context of Health Care “Production” System..
Examples of Tools for Regulation & Standards
Clinical procedures
Clinical practice guidelines, clinical pathways
Pharmaceuticals Clinical trials, GMP, drug registration, EDL
Medical devices Medical device regulation (ISO); technology assessment
Human resources
Certification, Licensing, CME
Standards and regulation of health system inputs
Performance Measurement: Tools and Instruments
Evidence-Based Medicine: Health Technology Assessment
evaluating efficacy, cost-effectiveness & appropriatenessassessment of multiple inputsPotential value in defining a bundle of effective health interventions (personal and public health)
Still in early stages of development
Accounting for production process
Note: 1. CC = complicating conditions.
U.S. Medicare DRGS
Australian DRGs (Version 4.1)
Croatian PPTP
106 Coronary Bypass with PTCA
F05A
Coronary Bypass with Invasive Cardiac Investig. Procedure with catastrophic CC /1
107
Coronary Bypass with cardiac catheterization
F05B
Coronary Bypass with Invasive Cardiac Investig. Procedure without Catastrophic CC
108 Other cardio thoracic procedures
F06A
Coronary Bypass without Invasive Cardiac Investig. Procedure with Catastrophic or Severe CC
109
Coronary Bypass without cardiac Catheterization
F06B
Coronary Bypass without Invasive Cardiac Investig. Procedure without Catastrophic or Severe CC
Coronary
Bypass Surgery
Source: Croatia Health Finance Study, 2003, The World Bank
Cycle of Medical Technology Assessment, Planning & Implementation
Health Professionals
Health facilities
HEALTH TECHNOLOGY ASSESSMENT- Identification of priorities- Testing and analysis- Synthesis- Dissemination
Pharmaceuticals
Medical Devices
As
se
ss
me
nt
P
lan
nin
g &
De
cis
ion
s
Acquisition
Incoming InspectionIm
ple
me
nta
tio
n
Investment planning
Standards & Protocols
Policy, Planning & Management Decisions
Education Policy
Planning, Needs
assessment
Inventory & Documentation
Commissioning & Acceptance
Monitoring Use & Performance
Maintenance
Decommissioning
Safety, Efficacy, Cost-
Effectiveness
Quality Assurance & Risk
Management
Evaluation of drugs, devices, procedures & delivery systems
Database-Building for Regulation,
Technology Assessment
Life Cycle Management
Health Service
Outcomes
POLICY ANALYSIS- Service Coverage- Planning (# & distribution)- Regulatory systems- Standards and Guidelines- Educational Policies- Ethical standards
Manufacturers
Third-Party Payers
Registration, licensing
SOCIO-ECONOMIC CONTEXT
Social services,Environ-
mental policies,
Otherinter-
sectoralprograms
Health Care Production
Setting
managedcare,gate-keepingfunctions,continuityof care,...
Health CareServices
clinical practicedrugs, medical
technology, HRD
Public Health
Programs,Health
Promotion
Health Outcomes(e.g. QALYs)
R&D, Investments
Structure and Context of Health Care “Production” System..
Variety of production categories and settings
Categories of personal careAcute careIntensive careRehabilitative carePalliative careOutpatient (specialist) clinical carePrimary care (general practice)
How to bundle production processes?
Evaluating productivity under different health care organizational settings
Mixed results on the impact of organizational reforms in US in the 1990s:
Vertical and horizontal integrationNon-profit vs for-profit
European experience:“Internal markets”, separation of provider/payer functionsDecentralization & corporatization
SOCIO-ECONOMIC CONTEXT
Social services,Environ-
mental policies,
Otherinter-
sectoralprograms
Health Care Production
Setting
managedcare,gate-keepingfunctions,continuityof care,...
Health CareServices
clinical practicedrugs, medical
technology, HRD
Public Health
Programs,Health
Promotion
Health Outcomes(e.g. QALYs)
R&D, Investments
Structure and Context of Health Care “Production” System..
FLOW OF
FUNDS
Relating production to financing and costs
System of Health Accounts offers:Comprehensive and consistent definition of “core” health care activities, boundariesInternational classification on sources and uses of health resourcesComparable description of the flow of funds from sources to uses
Is it sufficient to describe financial flows for productivity measures?
Health System Performance Evaluation Process
Utilization and Quality Reviews
Analysis of Outputs, outcomesand Expenditures
Provider levelPopulation
groups
Clinical and epidemiological
outcomes
NHA frameworkon resource flows
Evi
denc
e-B
a se d
Me d
icin
e
Ser
v ic e
ben
c hm
a rks
HT
A, C
ost-
e ff e
c ti v
ene s
s A
n al y
sis
Measuring Health Systems PerformanceRevenues Revenues
/Inputs/Inputs
• Redistribution Redistribution (Equity)(Equity)
• Administrative Administrative EfficiencyEfficiency
• Risk-pooling/ Risk-pooling/
InsuranceInsurance
Health Services Health Services ThroughputsThroughputs
• Allocative Allocative EfficiencyEfficiency
• Technical Technical efficiencyefficiency
• Efficacy/ Efficacy/ EffectivenessEffectiveness
Health Health OutcomesOutcomes
• Aggregate Aggregate
• Disease Disease specific specific
• Socio-Socio-economic economic factorsfactors
A comprehensive Health Management Information System needed to track critical
performance indicators at all levels
Structure of an integrated health management information system
patientsheath data
resources activities
authorisations
classifications
common data & functions
Health Care Management: daily
operational support
Patients, public
Clinical venues
Source: Adapted from Leo P. Vollebregt, EHTEL
Life-time patient record, analyses
Public information, education, etc.
Insurer/payerClaims processing
Utilization & quality reviews
Health policy, strategic planning,
regulation
Public healthReporting,
surveillance, statistics
European e-Health Initiatives: Potential Applications
Public health statistics, reporting & surveillanceBeneficiary management for insurers/payers
Eligibility checking, claims processing, utilization & quality reviews/ medical audits
Health care management Health policy, management and planning Patient Lifetime Health Records
E-Europe 2005 objectives
European Wide e-Health Insurance CardRegional Health Information Networks (broadband) connecting all Health ActorsOnline Health Services : e-Health Record, tele-consultation, e-medication, e-reimbursement (across national borders)
Introduction of Health Information Clearinghouse concept: public or private entity that facilitates processing of nonstandard health data into standard data elements
Opportunities created by EU Integration
Information standards motivated by EU e-Health initiativesHISA Health Information Systems Architecture
CEN – TC251 European Standards Centre
Specific Middleware Architecture open to all kinds of standards: HL7, IP, XML, JavaEffective strategy for dealing with Legacy Health SystemsStandard categories and definitions
EU regulation on patient confidentiality, privacy, security
Impact of EU Integration and Expansion...
Need for common information standards for health insurers/ purchasing agenciesNeed for transparency, comparability on quality of care, cost structuresNeed for security, privacy, patient confidentiality
Impact of EU Integration and Expansion...
Potential consolidation of providers and insurers seeking:
Economies of scale and scopeLower cost structuresHigher quality
Impact of EU Integration and Expansion...
Movement of goods, services and people across borders
Pharmaceuticals and medical devicesHealth professionals
Harmonization of regulationResearch and Development
Look for lessons from US Health Insurance Portability and Accountability Act (HIPAA), 1996
To improve portability & continuity of health insurance coverage in group & individual marketsAll entities covered by CMS (formerly HCFA) must be in compliance with electronic transactions and code sets standards (by Oct 16, 2003)
ConclusionMany positive developments in measurement tools, but will require strategic coordination among different domains to obtain meaningful results in aggregateDevelopment of a comprehensive strategy for health management information system is critical EU integration offers opportunities and motivation for finding common standards, strategies
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