cambridge march 15, 2006 international health leadership programme health system reform – lessons...
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CambridgeMarch 15, 2006
INTERNATIONAL HEALTH LEADERSHIP PROGRAMME
HEALTH SYSTEM REFORM – HEALTH SYSTEM REFORM – LESSONS AND EXAMPLESLESSONS AND EXAMPLES
Dr. Nicolaus HenkeDr. Nicolaus Henke
HEALTH SYSTEM REFORM – HEALTH SYSTEM REFORM – LESSONS AND EXAMPLESLESSONS AND EXAMPLES
Dr. Nicolaus HenkeDr. Nicolaus Henke
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OUR 2005/2006 EXPOSURE TO HEALTH REFORM
Americas
•Canada
•U.S.•Mexico
Europe
•Germany•U.K.•Norway•Portugal
• Ireland•Spain•Belgium•Sweden
Middle Eastand Africa
•Mauritania•Bahrain•Egypt•Abu Dhabi
•KSA•Libya
Asia/Australasia
•Singapore• India
•South Korea
•China•Japan
System level and payer/ provider
Payer/ provider
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Need to be specific about…
-which policy / mechanisms that can unleash change
- what good looks like in 5 years
Large quality variations in spite of growing amount of money inflows
2
Patients starting to act as consumers and demanding better services – but are unwilling to accept resulting tax burden
3
Main elements of reform agreed at policy level – challenges in execution and engagement
4
CHALLENGES
Government led systems generally unresponsive
1
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status1
011706 Team Update V7
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status1
Ensure financing access to care2
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status1
Ensure financing access to care2
Foster quality3
011706 Team Update V7
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status1
Ensure financing access to care2
Foster quality3
Adjust capacity4
011706 Team Update V7
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status1
Ensure financing access to care2
Foster quality3
Adjust capacity4
Involve consumer5
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status1
Ensure financing access to care2
Foster quality3
Adjust capacity4
Involve consumer5
Introduce competition6
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status1
Ensure financing access to care2
Foster quality3
Adjust capacity4
Involve consumer5
Introduce competition6
Adjust regulation and institutions / MOH7
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MANY REFORM PROGRAMS ARE BASED ON SEVEN UNDERLYING IDEAS
Improve public health status
1
Ensure financingaccess to care
2
Foster quality3
Adjust capacity4
Involve consumer5
Introduce competition
6
Adjust regulation and ministry
7
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… AND THREE WAYS TO DRIVE THROUGH EACH
BUILDAWARENESS
Improve public health status
1
Ensure financingaccess to care
2
Foster quality3
Adjust capacity4
Involve consumer5
Introduce competition
6
Adjust regulation and ministry
7
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… AND THREE WAYS TO DRIVE THROUGH EACH
BUILDAWARENESS
SETINCENTIVES
Improve public health status
1
Ensure financingaccess to care
2
Foster quality3
Adjust capacity4
Involve consumer5
Introduce competition
6
Adjust regulation and ministry
7
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… AND THREE WAYS TO DRIVE THROUGH EACH
BUILDAWARENESS
SETINCENTIVES
MANDATEDACTIONS
Improve public health status
1
Ensure financingaccess to care
2
Foster quality3
Adjust capacity4
Involve consumer5
Introduce competition
6
Adjust regulation and ministry
7
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Improve public health status - Examples1
Awareness:
Incentives:
Mandates:
- Educate public on diet, exercise, smoking, safe sex- Measure “Early Health”
Differential insurance premiums based on successful lifestyle changes
- Smoking ban- Vaccination campaigns- Require the use of automotive seat restraints and motorcycle helmets
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WHAT THE EARLY HEALTH INDEX COULD LOOK LIKE
Single index
Traffic light system
• ‘Nominal’– Index– Financial
Description
• Major indicators are scored red, yellow or green
Education
Vaccination
Diet
In vivo Dx
…
US China
Japan …
Example
Spend by disease stage (Diabetes example)
Prev-ention
DiagnosisTreat-ment
Comp-lication
~1%
35%
64%
~0%
• ‘Actual’– DALY– Expectation of life lost– Healthy life expectancy at birth
US
China
Japan
UK
…
Life lost due to low investment in ‘Early Health’
15 years
20 years
5 years
15 years
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‘STRAW MAN’- A SMALL NUMBER OF INTERVENTIONS DRIVE ‘EARLY HEALTH’ PERFORMANCE FOR MAJOR DISEASES
* Trachea/Bronchus/Lung Cancer
1 HIV/AIDS
Critical ‘Early Health’ interventions
Prevention Screening Diagnosis
• Education • In vitro diagnostics • In vitro diagnostics
2 Resp. cancer*• Education (e.g., reduction in
smoking)• Genotyping (?)• In vivo diagnostics
• In vivo diagnostics• In vitro diagnostics (e.g.,
pathology)3 COPD
4 Measles • Vaccination • Physician consultation • Physician consultation
5 Road traffic accident
• Education • – • –
6 Stomach cancer • Education (e.g., reduction in smoking ?)
• Diet
• Endoscopy• Genotyping (?)
• Endoscopy
Causes of death
7 Hypertensive heart disease
• Education• Diet
• Physician consultation• Genotyping (?)
• Physician consultation
8 Tuberculosis • Vaccination • In vitro diagnostics (e.g., microbiology)
• In vivo diagnostic
• In vitro diagnostics (e.g., microbiology)
• In vivo diagnostic
9 Self inflicted • Education • Physician consultation • Physician consultation
10 Ischemic Heart disease
• Education (e.g., reduce BP, reduce obesity, reduce cholesterol)
• Physician consultation• In vitro diagnostics
• Physician consultation• In vivo diagnostics (e.g.,
angiography)
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Ensure financing access to care2
- Educate about need to save
- Tax incentives and employer contribution to insurance schemes
- Mandated insurance or tax funded provision for all
Pages Hencke AI v0.1
MAURITANIA TESTS A MICRO-INSURANCE SCHEME FOR FULL PREGNANCY COVERAGE FOR $ 9 PER PREGNANCY
Payment of all costs included in the services pack
Respect of the standardised therapeutic procedures
Regular and secured purchase of medicines and consumables
Presence of qualified personnel at all instances of care
Availability of all technical means necessary to administer the care needed and covered
1
2
3
4
5
Pages Hencke AI v0.1
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PRELIMINARY RESULTS IN NUMBERS: ENCOURAGING PARTICIPATION IN PREVENTIVE ACTIVITIES; STRONG REDUCTION OF MORTALITY
Access to care
*CME: Consultation prénatale**Consultations Pré-et Post-Natale)
Number consultations / woman 2,6 1,7
Laboratory visits attendance 98% 31%
Echography 81% 21%
Childbirth's file made and maintained 100% 40%
Attendance of standard pre- and postnatal consultations 83% 50%
Maternal mortality 103 747(par 100k/par naissance ou par femme)
With F-F obst. care
Without F-F obst. care
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Ensurequality in a devolved system
1. Setstandards
3. Monitor and provide information
4. Assess, audit and enforce
5. Enable choice and competition through stronger payer function
Levers
• Strengthen national registration process, credentialing and accreditation mechanisms
• Strengthen peer review and ongoing validation• Introduce rigorous privileging at the provider level
• Use multiple levers to increase information available to patients• Prioritise key indicators to measure outcomes and adherence to best practice • Provide real-time standardised information through clear data protocols • Make information freely available to commissioners, public and providers • Build GP capabilities to monitor provider performance and analyse data
• Make investigation and enforcement for quality failures faster and more effective
• Strengthen consequence management for poor performers
• Extend choice and patient ownership of care decisions (e.g., treatments)• Strengthen payer skills, resources and systems to improve quality • Leverage payer purchasing power through joint commissioning (e.g., consortia)• Standardise care pathways and adherence to high quality care through commissioning • Strengthen existing quality incentives in contracts• Create competitive commissioning market
2. Provide incentives
• Provide financial incentives for high quality care to primary and secondary care providers
• Build quality indicators into Payment by Results
Foster quality3
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DETAILED STANDARDS FOR CARE – FOR EXAMPLE JCAHO AND CMS
*JCAHO implementation with July 2004 discharges**CMS and JCAHO changing to 120 minutes with July 2004 dischargesSource:JACHO; CMS; interviews; team analysis
CMS JCAHO
Acute MI
• Aspirin at arrival• Aspirin prescribed at discharge• ACE inhibitor for left ventricular systolic dysfunction• Adult smoking cessation advice/counseling• Beta blocker prescribed at discharge• Beta blocker at arrival• Mean time to thrombolysis• Thrombolytic agent received with 30 minutes of hospital arrival • Mean time to PCI• PCI received within 120 minutes of hospital arrival• Inpatient mortality
****,**
Heart failure
• Discharge instructions• Left ventricular function assessment• ACE inhibitor for left ventricular systolic dysfunction• Adult smoking cessation advice/counseling
Pneumonia
• Initial antibiotic received within 4 hours of hospital arrival• Initial antibiotic received within 8 hours of arrival• Antibiotic timing (Mean)• Initial antibiotic selection for community acquired pneumonia (CAP) in
immunocompetent patients• Blood cultures performed with 24 hours prior to or after hospital arrival• Blood culture performed before first antibiotic received in hospital• Influenza vaccination• Pneumococcal screening and/or vaccination • Adult smoking cessation advice/counseling• Oxygenation assessment
***
*
Surgical infection prevention
• Prophylactic antibiotic received with 1 hour prior to surgical incision• Prophylactic antibiotic selection for surgical patients• Prophylactic antibiotics discontinued within 24 hours after surgery end time
***
“I foresee JCAHO and CMS merging toward a common standard. We need leadership from a federal entity to ensure we don’t have disparate standard.”
– JCAHO Associate Director of Oryx
“JCAHO and CMS have plans to work together to expand standards into areas like pain management, children’s asthma, and ICV care. We have no qualms about taking on metrics other organizations like Leapfrog have developed.”
– JCAHO Associate Director of Oryx
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METRICS USED BY CMS/Premier Demonstration Project *
Heart Attack (Acute Myocardial Infarction or AMI) • Aspirin at arrival • Aspirin at discharge • ACE Inhibitor for Left Ventricular Systolic Dysfunction• Beta Blocker at arrival • Beta Blocker at discharge • Thrombolytic received within 30 minutes of hospital arrival• PCI received within 120 minutes of hospital arrival • Smoking cessation advice/counselling • Inpatient mortality rate
Coronary Artery Bypass Graft (CABG)• Aspirin at discharge• CABG using internal mammary artery• Prophylactic antibiotic 1 h prior to surgical incision• Prophylactic antibiotic selection for surgical patients• Prophylactic antibiotics discontinued within 24 hours after surgery• Inpatient mortality rate• Post operative haemorrhage or haematoma• Post operative physiologic and metabolic derangement
Heart Failure (HF) • Assessment of Left Ventricular Function • ACE Inhibitor for Left Ventricular Systolic Dysfunction• Detailed discharge instructions• Adult smoking cessation advice/counselling
*3 year pilot at consortium of nonprofit health systems including 270 hospitals and treating 400,000 patients in the 5 conditions Source: CMS/Premier Demonstration Project; WSJ, 4 May 2005; CMS Press Release 3 May 2005
Hip and Knee replacement• Prophylactic antibiotic 1 h prior to surgical incision• Prophylactic antibiotic selection for surgical patients• Prophylactic antibiotics discontinued within 24 hours after surgery• Post operative haemorrhage or haematoma• Post operative physiologic and metabolic derangement • Readmissions 30 days post discharge
Community Acquired Pneumonia (CAP)• Oxygenation Assessment• Initial Antibiotic• Antibiotic timing • Pneumococcal screening / vaccination• Blood culture performed first antibiotic received in hospital • Smoking cessation advice/counselling • Influenza screening / vaccination
90 9386 90
64 76
85 9170 80
AMI CABG HF Hip &Knee
CAP
Median quality scores improvements – year 1
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DIFFERENCES IN QUALITY BETWEEN PUBLICLY REPORTING AND NON-PUBLICLY REPORTING PLANS
Measure * Public reporters, %
94.6
81.2
75.2
66.0
80.9
49.9
84.9
61.0
88.7
90.2
60.4
Non-public reporters, %
90.1
71.5
67.8
52.4
73.3
39.4
81.4
55.5
85.6
81.2
40.6
Difference, %
19.8
9.0
4.5
9.7
7.4
13.6
7.6
10.5
3.5
5.5
3.1
• Adolescent immunisation status (combo 1)
• Beta-blocker treatment after heart attack
• Check-ups after delivery
• Childhood immunisation status (combo 1)
• Cholesterol management – Control (LDL <130)
• Cholesterol management – Screening
• Comprehensive diabetes care – Eye exams
• Comprehensive diabetes care – HbA1c testing
• Comprehensive diabetes care – Lipid control (LDL <130)
• Comprehensive diabetes care – Lipid profile
• Timeliness of prenatal care
*Selected averages for commercial (non-Medicare/Medicaid) providers
Source:NCQA – The State of Health Care Quality, 2004
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USE OF INFORMATION TO DRIVE QUALITY
0
5
10
15
20
25
30
35
1991-1995 1996-1999 1999-2002
Reduction in mortality rates since data began to be published by a private company
Mortality rate for open heart procedures in children under 1 %
Individual hospital trusts
A
BCD
EF
Source: Aylin et al. British Medical Journal, October 2004
U.K. EXAMPLE
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QUALITY MANAGEMENT IN PRIMARY CARE – NETHERLANDS
• Physicians take part in 6–12 peer reviews per yearPeer
reviews
Treatment guidelines
• About 70 guidelines have been developed
Quality monitoring
• Statistical analysis of treatment processes and outcomes
• Video recordings of physician-patient interaction
Practice visits
• Goal is mainly to evaluate management processes
• About 40% of all general practitioners take part
Key factsMeasures to ensure qualityHistory of quality initiatives
Initiatives to introduce peer reviews and treatment guidelines
Dekker reforms introduce competition and focus on quality
Law passed to enforce annual quality reviews
1970s
1980s/90s
1996
IMPROVE QUALITY
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CHRONIC DISEASE MANAGEMENT SHOWS POTENTIAL EXAMPLE
Source: PCT interviews; North Bradford PCT Performance Report, Sept. 2004; CDM Compendium, DH, 2004
Example: North Bradford PCT
DiabetesGPs
RespiratoryGPs
FrequentflyersGPs
Primary care center
Nurse support
Emergency admissions
25% 38%-73% 15%-70%
45% 90% 40%-50%
Average length of stay
Results
Approach
• Region’s patients stratified by risk group, creating 4-5 pools, e.g.,– Diabetes– Respiratory– Frequent hospital use
• GPs merged into primary care groups of up to 10, with 2 each trained on 1 disease (e.g., diabetes), networked with local specialist (to handle escalated cases), and given 24/7 nurse support
• Each patient assigned exclusively to GP/nurse, located at the primary care center
• System designed to reduce complications and time spent in the hospital
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CHRONIC DISEASE MANAGEMENT AND PRO-ACTIVE CASE MANAGEMENT
• Constant weight checks • More healthy nutrition • Best practice medication
Disease
Congestiveheart failure (CHF)
1
Disease management interventions GPs Nurse O/P
Effects on existing treatment structures
• Daily blood sugar checks• Expert patient programme• Best practice medication
Diabetes2
• Best practice medication• Expert patient programme• Peak flow monitoring
Asthma3
COPD4
CHD/ Hypertension
5 • Monitoring risk profile• Behaviour modification• Best practice medication
High risk / older people / Frequent flyers
6
A&EEmergency Admissions LOS
• Best practice medication• Expert patient programme• Peak flow monitoring
• Identification of patients• Allocation of case manager• Regular monitoring and
review• Pro-active assessment and
treatment• Best practice medication
25% 45%
40-90% 30%
38-73% 90%
20% 70%
??% ??%
15-70% 40-50%
Source: McKinsey analysis; Chronic disease management compendium, DH, 2004
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Adjust capacity - examples4
•Specialised players in US and UK
•Home monitoring to support chronic disease management
•Intermediate care in U.S.
•Regional emergency care planning in England
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Increasing case loadNumber of heart surgeries
Lower costsUS$000
43
27
THIU.S. average
- 37%
Higher quality – better survival rate, %
8292
THI5 year
U.S.average 1 year
SPECIALISATION IN HEART SURGERY – USA
Source: Texas Heart Institute
137
THIU.S. average
10,500
IMPROVE QUALITY
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SYSTEM PATIENT FLOW (REGION WITH 3 MILLION PEOPLE)
Blue light ambulance
Emergency care
Community care (incl
GPs)
Paramedic
Social care
Acute Care•“A&E”•ITU•CCU
•Inpatient care
Diagnostics
Outpatients
Intermediate care
Elective care
24x7 service
Telephone service
Patient
Source: Team analysis
Key thrusts• Triage early• Avoid inappropriate hospitalisation• Provide scheduled care where possible
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UTILIZATION CHANGES
* Based on 5-year projections** Based on national targets for diagnostics
Source: Team analysis
-20-30%
Activity redistribution to other Services (e.g. ECS)
Activity redistribution to self care
Underlying Activity Growth
ALOS reduction(partially due to transfer to Intermediate care; likely to be less than full 30% identified in initiatives, as simpler cases will have been transferred out)
16%
-84%
0%
A+E 16%
-36%
-8%
Inpatient spells
16%
-60%
-10%
OutpatientEpisodes
117%**
-44%
0%
DiagnosticEpisodes
Activity
Productivity
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IMPACT ON SITES
Acute care
Emergency care
Community care
Diagnostics
Intermediate care
Elective care
*22 community hospitals, 12 of which are non-Trust sites. Many of these currently provide (sub)-residential care**Highly preliminary
Source: Team analysis
SustainableSystem (5yrs+)
5-7
3-4
20
Co-located with Acute care/Emergency care
17-22
100-200
Current
3
Co-located with acute
22*
390
9
6
InterimSystem (2-3yrs)**
6-18
22
300-350
7-8
5-6
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*Stroke: 4 days acute, then rehab, Joint replacement 2 days acute then rehab, fractured neck of femur 2 days acute then rehabilitation in intermediate care
Source:Hospital bed utilisation in the NHS, Kaiser Permanente and the US Medicare programme. Ham et al. BMJ 2003;327:1257-60, Bedfordshire and Hertfordshire SHA
• NHS OBDs per 100’000 population >65 yrs, 000s
StrokeJoint
Replace-ment
Fractured neck of femur
Total
• ALOS in NHS, days
• ALOS in Kaiser, days
• OBDs with Kaiser ALOS, 000s
• OBDs saved per 100’000 population >65yrs,000s
• Total OBDs, 000s
• Current ALOS, days
• Best practice ALOS, days
• OBDs if applied best practice, 000s
• OBDs save, 000s
Comparison Kaiser—NHS
Benchmarking Beds and Herts SHA (1.5m population)
22.3
27
4.26
3.5
18.8
55.5
17.7
~4*
12.5
33.0
8.2
12
4.3
2.9
5.3
38.3
13.5
~4
11.3
27.0
8.4
27
4.9
1.5
6.9
34.0
20
~2
3.4
31.6
30.7
12.5
91.6
38.9
34.0
• Current LOS range, days 0–393 0–225 0–515
• Kaiser comparison suggests there is much scope to reduce LOS in hospitals38.9
INCREASE CAPACITY
STEPDOWN SERVICES CAN SUBSTANTIALLY REDUCE LENGTH OF STAY IN ACUTE CENTRES
• Top 3 conditions account for 40% of potential shift from acute sector to intermediate
• Extrapolates to 3m bed days in England
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Involve consumer5
•Urban sickness funds in China
•Differentiate offering to consumer segments
•Consumer information in Norway
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Increasing rights and expectations• Growing demand for efficient, convenient, and
personalized services (from and beyond health care)• Greater clarity of treatment outcomes• More power to challenge health-care professionals• Larger influence of advocacy groups
Increasing and changing health-care needs• Aging population• Increased prevalence and burden of disease• Greater focus on wellness and prevention• Broader definition of disease
Increasing responsibilities• Rolling back of health-
care systems (increased rationing and co-payment)
• Requirement for active decision making
• Product innovation from insurers/providers
Advanced technology and more information• Better access to health
information• More treatment options• Advancing medical and
information technology• Growing innovation in
private sector
FOUR MAIN DRIVERS OF CONSUMERISM
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GOVERNMENT RESPONDING TO SOCIAL PRESSURE
*Police definition
Source:Ministry of Public Security statistics; People’s Daily
• Government launched “Harmonious Society” campaign, November 2004– Intended to “enable all people to share the social wealth created in reform
and development”– Includes increased investments in healthcare and other social infrastructure
• In healthcare, is seeking to increase “Basic Urban” insurance cover from 130 to ~450 MM
• Is also piloting rural insurance scheme, though at very low coverage levels
10
50
96
9
40
95
2532
01 02
58
2003
45
11
98
12
94 00
15
1993 97 99
“Mass incidents”* in ChinaThousands
Government needs to improve healthcare to address foreign investors’:• Concerns about lost productivity• Concerns about having to pick up the slack
Government increasingly concerned by violent protests
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Lives 2003
Basis of industry growth projections
Most insurance products have high deductibles and co-pays, leading to continued suppressed demand
Insurance coverage
ILLUSTRATIVE
• Rural scheme or out of pocket
• Without private insurance• Low, very cost-sensitive
demand
Other
• Rural scheme with U.S.$75 deductible, 80% co-pays
• Private cover to reduce out-of-pocket expense
Coastal rural
• Urban scheme deductible 10% average salary (U.S.$700/yr in Shanghai);
• Co-pay ~40% (outpatient), 10-20% (inpatient), depending on region and service
Mass market
~25MM• Private insurance • Urban SchemePremium
MULTI-TIER CONSUMER MARKET IS EMERGING
*Projection assumes premium and coastal urban segments grow at private insurance premium CAGR (13% 2003-2010); all Premium have Urban Basic insurance; Government achieves goal of insuring 450 MM urban population; Chinese population grows to ~1,380 MM
Source: MOH 2003 National Health Services Survey; Asian Demographics; literature survey; team analysis
Lives 2015
~100MM
~105MM ~350MM
~15MM ~50MM
~1,150MM ~900MM
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386.4
600.0
236.01,319.0
Cost of treatment 80% Co-payExcluded services
96.6
Deductible Reimbursement
MEDICAL EXPENSE EXAMPLE: BROKEN FINGERRMB (US$1 = 8.3 RMB)
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Desire for health-care proactivity
“Anxious Seeker”
14%
“Receiver”17%
“Proactive”21%P
sych
olo
gic
al b
urd
en
of
hea
lth
co
nce
rns High
Low High
Low
“Depender”14%
“Avoider”18%
“Stoic”16%
While distinct segments exist, patient behavior varies widely within each segment
WE SEE SIX DISTINCT ATTITUDINAL SEGMENTS WHICH ARE GOOD PREDICTORS AND PROXIES FOR BEHAVIOUR
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T H E 6 S E G M E N T S U S E C L I N I C A L S E R V I C E S V E R Y D I F F E R E N T L Y
P r o a c t i v e a b o u t h e a l t h a n d l i f e s t y l e
A v e r a g eU K d a t a
6 7 %
U n d e r t a k i n g i n d e p e n d e n t r e s e a r c h
2 9 %
C h a l l e n g i n g d o c t o r o n d i a g n o s i s o r t r e a t m e n t
1 9 %
1 38 8
- 5
- 1 3- 9
1 71 4
- 2
- 1 0- 1 4
- 5
96
- 3- 6
4
- 1 0
U s e o f d o c t o r p e r a n n u m
N o r m a l i s e d t o 1 0 0 % ( a p p r o x
4 . 7 v i s i t s / y e a r )
1 0
6 0 8 0
- 3 0- 5 0 - 6 0
S o u r c e : M c K i n s e y
E x h i b i t 2 0
P r o a c t i v e A n x i o u s S e e k e r D e p e n d e r R e c e i v e r A v o i d e r S t o i c
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INVOLVE CONSUMER TO DRIVE HOSPITAL QUALITY
How it works
• Free choice of hospital (since January 2001)
• Patients free to call toll free number or visit website to find shortest waiting times and book treatment (since May 2003)
• Hospital outcome ratings and rankings of service level by hospital on internet (since September 2003)
• Patient is guaranteed treatment within a certain time period by law
Source:www.sykehusvalg.net; McKinsey
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Introduce competition6
• Leads to new ideas and new dynamics (better services, more efficient medical cost management)
• Example: Germany, U.S.• May impede chronic disease management and add overhead cost
• Drives through improvements in efficiency and quality of care as well as responsiveness to patient needs
• Examples: Foundation Trusts in England, regional budgets and contracting (e.g., Norway, Italy, Germany)
• Need to make the choosing process meaningful and data transparent to avoid competition on meaningless parameters – in reality choice does not mean patients choosing hospitals, but doctors choosing doctors with very limited factual information
Hypotheses based on experiences so far
Competition between payors
Contestabilty for hospitals and doctors
Building blocks
• Regulatory framework critical for overall success, two key roles– Consumer protection / quality watchdog– Financial, governance and market rules and behaviours of players
Independent regulation
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NHS IN ENGLAND IS BUYING IN DIAGNOSTIC AND SURGERY CAPACITY FROM THE PRIVATE SECTOR INCREASE CAPACITY
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SETTING UP OF FOUNDATION TRUSTS IN ENGLAND
New freedoms bestowed on hospitals
Potential ways of improving services
• Able to borrow money on capital markets
• No more directives from DH (previously over one per day)
• Full profit and loss accountability
• Able to develop strategic partnerships
• Able to develop new services
• Companies with P&L, in charge of revenues and costs
• Investment in new facilities
• Innovating to develop patient services
• Focus on efficiency and cost effectiveness – keeping the savings
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Policy
Regulation
Role
Payors
Although hospitals can be public sector, increasing trend to operational independence
of hospitals
Public and private insurers
Public and private insurers
Singapore GermanyUnitedKingdom Norway
Country
Private & public hospitals; private physicians
Ministry of Health
Professional organisations
Public hospitals
Dept. of Health
Primary Care Trusts
Healthcare Commission;SHAs
Public hospitals
Ministry of Health
Ministry of Health
National Board of Health
Private & public hospitals; private physicians
Ministry of Health
Qatar and Abu Dhabi
have already moved
functions from ministries to authorities;
the UAE federal
government is following
Service provision
Adjust regulation and institutions / MOH7
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2 ROLES: ECONOMIC REGULATION AND CONSUMER PROTECTION TO REGULATE EX-STATE RUN INDUSTRIES (UK EXAMPLE)
*Reflects network/distribution segment of market vs. other market segments (e.g., broadcasting, gas metering) Source:Interviews with regulators
Economic regulation
Consumer protection
Healthcare
HousingGas & electricity*
Commu-nication* MailFTs Non-FTs IS
• Set conditions for market entry and exit
• Monitor and disclose financial performance
n/a
• Manage financial in-stability
n/an/a
• Achieve sustainable profits for providers
n/a n/a
• Manage competition
• Ensure affordable end-user pricing
n/a
• Set quality standards
• Monitor quality
n/an/a
n/a
• Encourage choice and innovation
• Promote safety of public
• Manage externalities (e.g., environmental impact)
n/an/a n/an/an/an/a
Water Rail Government
Economic regulator
Quality and safety regulator(s)
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SHOULD MINISTRY AND HEALTH SERVICE BE SEPARATE?
Source: Team analysis
Minister of Health
Standards and quality (CMO)
Primary Care
Strategy and Policy co-ord
DH Finance
DH IT policy and standards
DH HR policy and standardds
DH communications
Secondary Care
Social Care & Public Health
Other Care (Drugs, Mental health, Dental)
Cancer
Diabetes
…Investigations & Inquiries
NHS communications
Health Service Executive
SHAs
Provider developmentNHS Finance, Strategy & PlanningNHS IT implementation
NHS workforce
Planning and capability development
DRAFT
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DRAWING IT TOGETHER – EXAMPLE OF A DIAGNOSTIC
Issue Action
• System appears to be accumulating debt
• System unable to make most effective use of resources
• Fix Patient Treatment at the Expense of the State
• Fix Health Insurance Organisation• Rationalise services
2. Fix financing
• Poor exposed to health shocks as a result of high level of out of pocket spend
• Launch package• Shift OOP spending into pools• Subsidise poor/ fund for non-risk
events (i.e., primary care, ?old age?)
1. Increase pooling
• Poor responsiveness of system, notably hospitals, to patient needs– Centrally driven – hospitals have little
flexibility on staff & budget
• Fix clinic/ hospital management through increased autonomy and building capabilities– Devolve (some) resource flexibility
(staff, budget)• Focus on defined basic package
3. Improve service delivery
• While physical access is not an issue, service, drug & quality staff availability is
• Increase incentives to work in rural areas (clinicians & management)
• Reform takleef (existing allocation mechanism)
4. Improve access for the poor/ rural
• 94% of nurses have only secondary level of education
• Medical schools are expanding imperilling standards
• Weakest doctors are allocated to positions with least oversight/ training
• Step up post-high school nurse training• Increase oversight/ training for rural
doctors
5. Increase levels of education
• MoHP currently sprawls across all roles• Suboptimal performance
• Institute independent quality assessment/ accreditation
• Simplify organisational structure
6. Refocus organisations
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EXAMPLE OF A PROGRAM – ENGLAND 1999-2008
Steps
1) Create capacity 1999-2004•Set targets•Abandon 4 regional HQ and health authorities, create 28 SHAs and 300 PCTs under
•Triple nominal spend over 10 years to meet targets
2) Create plural market 2004-2008•Aggressive new access targets•Choice•Plurality of supply (FT, ISTC)• Incentives – PBR, Consultant contract, GP contract
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0
50,000
100,000
150,000
200,000
250,000
300,000
Mar-00Sep-00
Mar-01Sep-01
Mar-02Sep-02
Mar-03Sep-03
Mar-04Sep-04
Sep-05Mar-05
WAITING TIMESInpatient waiting times in England (March 00 – September 05)Number of patients waiting for admission
> 6 months
> 9 months
> 12 months
> 15 months
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KEY OBSERVATIONS AND TAKEAWAYS
•Seven ideas underlying most system reforms
• Incentives matter, including how payers pay and how provider contestability is enabled
• Information matters
•Balance of mandates vs incentives vs information is important
• Involving the consumer will be critical
•Sequencing and capability building is one of the biggest challenges
•Success may be driven by
–A very clear view of what system success looks like in 3-5 years (results)
–Focus on executing on 2-3 key policies to get there, and evolving them over time