Drivers of change

The drivers of change in the health system in response to the crisis can only be understood against the background of European obligations and some specific characteristics of the Belgian health care sector.

European obligations

In 2009, Belgium was urged by the Council of the EU to take measures to reduce its government deficit, which accounted for 5.6% of GDP at that time.

Between 2010 and 2012, the deficit needed to decline by 0.75% of GDP per year (Council of the European Union, 2009). By the end of 2012, the objective had not yet been reached, mainly because of the capital injections the government made into the banking sector (about 0.8% of GDP) (European Commission, 2013).

Instruments available since the beginning of the 1990s

Despite this fiscal pressure, the need and possibilities for change in the health care sector were limited in the early years of the crisis. Several factors contributed to this. First, at the outbreak of the crisis in 2008, Belgian policy-makers had a set of instruments at their disposal that postponed the impact of the crisis on the health sector. These instruments were introduced at the beginning of the 1990s to fulfil the convergence criteria as outlined by the Maastricht Treaty, which entered into force in 1993. The convergence criteria with respect to government finance imply that the ratio of gross government debt to GDP must not exceed 60%¹⁵ and the ratio of the annual government deficit to GDP must not exceed 3% at the end of the preceding fiscal year. In 1993, the gross government debt was 137.8% of GDP (National Bank of Belgium, 2013) and the government deficit was 7.5% of GDP (OECD, 2013c).

The main purpose of the reforms in the 1990s was to increase the cost-consciousness and cost-participation of all the partners in the health care sector. The idea of monitoring the development of health spending within an a-priori budget and close monitoring of subsector budget overruns was the first important innovation. A real growth cap was introduced in 1995 to restrict the annual maximum increase in the health budget to 1.5% in real terms. In 1999, when Belgium entered the Economic and Monetary Union, the growth cap was raised to 2.5%, and then to 4.5% from 2005, resulting in annual health budget surpluses since that year. Between 2005 and 2010, this budget surplus

15 This rule was not enforced, as most members of the Economic and Monetary Union were unable to meet this criterion before 1999.

was transferred to the so-called Fund for the Future, to other subsectors of social security or was used for new initiatives. Moreover, the budget surplus allowed policy-makers to focus on protection measures to shelter citizens from potential access barriers to health care. A second innovation of the reforms at the beginning of the 1990s was the introduction of individual and collective financial responsibility for the sickness funds. These structural reforms had been in place for more than 15 years before the outbreak of the crisis, and accorded important protection to the system.

No government for 541 days

A second factor limiting the need for change was that between June 2010 and December 2011 Belgium had a caretaker government that could not impose austerity measures. The health budget for 2011 was consequently established under special circumstances: by a government that could not take new legal initiatives, in a context where the general government deficit was very large and where there was a surplus in the health care budget of €1.8 billion. Stakeholders were aware that this situation had protected the health care sector probably more than other sectors. They realized that the need to implement savings was inevitable and that the real growth cap could not be maintained given the economic situation. This is illustrated, for example, by the advice of RIZIV's Health Care Insurance Committee, consisting of representatives of the major stakeholders, to transfer €1464.9 million of the surplus in the health care budget (about 5.3% of the total health care budget) to other social security sectors. Moreover, while new initiatives costing €125.8 million in total were still honoured, at the same time savings measures were taken (worth €116.5 million) to compensate for the costs of the new initiatives. In 2012, there was no increase in the health care budget and the decision was taken to reduce the real growth cap for 2013 and 2014, although it still remained positive.

Fiscal federalism reform

The fiscal federalism reform (called the Sixth State Reform or Butterfly Agreement: Dutch, Vlinderakkoord; French L'accord papillon) is a third factor explaining health system changes. The reform gives more spending responsibilities to the federated entities (regions) (estimated at 4.5% of GDP in 2011), mainly in the areas of family allowances, health care and labour market policies (OECD, 2013a). The transfer of competencies in the health care sector relates to residential nursing care for older patients, hospital infrastructure and investment in the organization of primary care. The main option chosen in the reform was to maintain the financing and accreditation of basic (para)medical activities at the federal level and to transfer infrastructure-related and organizational competences to the communities, with effect from

1 July 2014. The Sixth State Reform is first and foremost a political agreement with a substantial transfer of powers in health care to the communities. The aim of the transfer is to have a more rational distribution of tasks, but the issue of conflicting incentives between government levels has not been addressed (OECD, 2013a).

All of these background factors forced policy-makers to be more explicit about choices. Safeguarding and improving financial accessibility to high-quality health care was the first concern. A second priority was to ensure a sufficiently large workforce in the health care sector. The fact that budget proposals for 2012 and 2013 had to be formulated within tight budgetary margins raised awareness among stakeholders that measures to increase health care efficiency were inevitable. In that sense, several agreements (between sickness funds and health care professionals) contained structural measures (some not implemented yet) based on evidence-based medicine instead of the former linear cuts in indexation. Examples include the revision of the Belgian fee schedule (to take place in the years to come), whereby fees become better correlated with real-time investment and costs; measures to increase the attractiveness of general practice; the revision of financing mechanisms for medical imaging, dialysis and emergency care; the development of DMPs for chronic diseases; emphasis on preventive and conserving dental care; and the promotion of INN prescribing (see also section 3).

For 2013 and 2014, priorities continued to be accessibility and quality of care. An important additional objective is financial transparency, especially in the ambulatory sector. Concrete initiatives include proposed new laws to increase accessibility to drugs for unmet medical needs and to introduce greater transparency for ambulatory care costs. The major breakthrough regarding transparency will be that, from 2016 onwards, the health care certificate that patients receive when they visit a doctor will mention explicitly the supplement paid over and above the official tariff, the latter equalling the sum of the reimbursed amount and the co-payment.

The pressure on government budgets has also breached certain taboos, for example regarding the fight against social fraud, the monitoring of outliers in dental care, the lack of transparency in supplements paid by patients to medical doctors, the explicit comparison of the quality of care in hospitals, and so on.

Measures have been applied in the dental care sector, for example, to reduce expenditure because a small group of outliers was exploiting the system, albeit in a legally correct manner as they could not be prosecuted for their excessive activities.¹⁶ This was frustrating to the larger group of responsible dentists

16 To illustrate the extent of the excesses: simulations showed that 31 dentists (0.4% of all dentists) accounted for 1.35%

and 1.30% of total expenditure for dental care in 2010 and 2011, respectively.

acting in the interests of attaining financial balance in their sector. In 2012, the association of dentists and sickness funds (Nationale Dento-Mutualiste) developed legal instruments to sanction the outliers, which became effective from 2013. Such action illustrates the goodwill of providers and sickness funds to collaborate to fight excesses.