Changes to health system plan ning and purchas ing organ isa tions Efforts to lower health system admin is trat ive costs

Twenty- two coun tries repor ted restruc tur ing health minis tries, public heath bodies or purchas ing organ iz a tions in direct response to the crisis (Table 5.2).

These changes often involved redu cing the number of admin is trat ive staff, some times as part of a wider govern ment policy to cut civil servant numbers.

The largest repor ted reduc tions were in Latvia, where the number of employ ees

Table 5.1 Summary of repor ted changes to health service plan ning, purchas ing and deliv ery, 2008–13

Policy area Number of coun tries report ing

Direct responses Partial/possible responses Health system plan ning and purchas ing organ iz a tions

Measures to lower admin is trat ive costs 22 9

Public health services

Cuts to public health budgets 6 0

Measures to strengthen promo tion and

preven tion 12 18

Primary care and ambu lat ory care

Cuts to funding 5 0

Increased funding 3 2

Changes to payment 1 4

Delivery: clos ures 2 0

Delivery: shift ing care out of hospit als 11 3

Delivery: skill mix 3 0

Delivery: access 5 1

The hospital sector

Cuts to funding and reduced invest ment 28 8

Increased invest ment 3 6

Changes to payment 8 12

Delivery: clos ures, mergers 11 7

Drugs and medical devices

Lower prices 22 20

Evidence- based use 10 8

Health workers

Lower payment and numbers 22 5

The role of health tech no logy assess ment (HTA)

Greater use of HTA to inform cover age decisions 7 8

Greater use of HTA to inform care deliv ery 9 6

The role of eHealth

Greater use of eHealth 4 7

Source: Survey and case studies.

108 Economic Crisis, Health Systems and Health in Europe

Table 5.2 Reported meas ures to lower health system admin is trat ive costs, 2008–13 Policy responses Countries

Restructuring minis tries

and public sector agen cies Denmark, Greece, Hungary, Iceland, Latvia, Lithuania, Republic of Moldova, Poland, Romania, Russian Federation, United Kingdom (England)

Closing or merging public

health bodies Bulgaria, Iceland, Latvia, Lithuania, Ukraine

Centralizing purchas ing Belarus, Bulgaria, Croatia, Cyprus, Czech Republic, France, Greece, Italy, Latvia, Portugal, Slovakia, Spain, Ukraine Reducing admin is trat ive

staff numbers Austria, Belgium, Bulgaria, Denmark, Ireland, Kyrgyzstan, Latvia, Serbia, Slovakia, Tajikistan, Ukraine, United Kingdom (Scotland, Wales) Reducing admin is trat ive

and other over head costs Belarus, Belgium, Bulgaria, Czech Republic, Ireland, Netherlands, Slovakia, Switzerland, United Kingdom (England, Northern Ireland, Scotland, Wales) Source: Survey and case studies.

of the Ministry of Health and its agen cies was cut by 55 per cent between 2009 and 2012, and in Ukraine, where a restruc tur ing of the state Sanitary and Epidemiological Service and Ministry of Health in 2013 resul ted in a 43 per cent cut in staff numbers. Administrative staff numbers may also have been reduced in coun tries that repor ted general meas ures to lower admin is trat ive costs.

Notable efforts to cent ral ize purchas ing include a proposal in the Czech Republic to create a single Health Insurance Office and the merger of health insur ance funds in Greece to create a new purchas ing agency (Box 5.1). The new Health Insurance Office in the Czech Republic aims to minim ize duplic a-tion by setting diagnosis- related group (DRG) tariffs and regis ter ing providers for all health insur ance funds. Some cent ral iz a tion was tempor ary: in Bulgaria the Ministry of Finance took respons ib il ity for setting prices, but later returned this func tion to the health insur ance fund.

Box 5.1 Reform of plan ning and purchas ing organ isa tions in Greece As part of its economic adjust ment programme (EAP), Greece has developed a new frame work for health system governance involving:

i) the separ a tion of the health branches of the wider social secur ity funds from the admin is tra tion of pensions; ii) bring ing all health- related activ i-t ies under i-the Minisi-try of Heali-th and Social Solidarii-ty; iii) i-the merger of health funds to address frag ment a tion in pooling and purchas ing;

and – most signi fic antly – iv) a new national purchas ing agency (EOPYY) to be respons ible for purchas ing all publicly financed health services, coordin at ing primary care, regu lat ing contract ing and setting quality and effi ciency stand ards.

Source: Economou et al. 2015

Policy impact and implic a tions

On average, public spend ing on health sector admin is tra tion fell by nearly two per cent in 2009, but returned to posit ive growth in 2010 and 2011, although at a slower rate than before the crisis (Figure 5.1). This suggests that some changes to plan ning and purchas ing organ iz a tions were effect ive in redu cing admin is trat ive spend ing, but that effects may have been relat ively short- lived.

As many of these changes have not been eval u ated, however, it is diffi cult to say whether they have enhanced admin is trat ive effi ciency. If capa city is already low, the loss of exper i enced policy and admin is trat ive staff may be coun ter pro duct ive, espe cially at a time of rapid reform requir ing increased capa city for plan ning and over sight. Staff reduc tions also risk strike action by public sector workers, as demon strated by recent trends across Europe (Parry 2011), as well as higher costs where tempor ary labour is needed to help meet short falls.

Reforms to consol id ate risk pools and cent ral ize purchas ing have consid er-able poten tial to improve effi ciency (Kutzin 2008; Kutzin et al. 2010; Thomson et al. 2009). Not only are they likely to minim ize duplic a tion and lower admin is-trat ive costs; they also increase a country’s poten tial to match resources to need and, by strength en ing the power of purchasers in rela tion to providers, they may bring about cost and quality improve ments. In Greece, the creation of a single purchas ing agency has been an important step towards address ing the effi-ciency and equity prob lems asso ci ated with the previ ously highly frag men ted

Figure 5.1 Public spend ing on health by func tion, annual growth rates, 2007–11, EU27 and selec ted coun tries

Source: OECD- WHO- Eurostat Joint Data Collection (2014).

Note: Data include EU27, Iceland, Norway and Switzerland.

110 Economic Crisis, Health Systems and Health in Europe

pooling and purchas ing arrange ments (Kastanioti et al. 2013). As a result of this change in purchas ing market struc ture, Austria and France are now the only EU coun tries with multiple, non- compet ing health insur ance funds (Thomson et al. 2009).