Healthcare reform in the Netherlands: after 15 years of regulated competition

This article discusses the results and prospects of the market reform in Dutch health care which came into force in 2006. Attention is paid to the results of the health insurance reform, the experience with the shift from passive to active purchasing and the impact of the reform on healthcare provision and cost control respectively. Other topics discussed are the consequences of the reform for administrative costs, institutional trust in health insurance, and the power balance in health care after reform. The central message is that the high expectations of the market reform have not come true. Dutch health care features a high degree of hybridity and there are indications that the system is becoming ever more hybrid: the system operates much less market-like than the market frame suggests. Currently, the policy narrative on the reform is changing. Policymakers and policy documents underscore the need for cooperation in provider networks and more state direction. The Dutch experience with health care reform illustrates the pendulum theory. After a period of a belief in competition and less state direction the pendulum in policymaking swings back to a belief in cooperation and a pro-active role of the state.

Assessing the relation between financial performance and long-term bank loan interest rates for healthcare providers in the Netherlands: a panel data analysis

The Dutch health system is financed predominantly by commercial bank loans, especially after the market-oriented reform in 2006, when government investment guarantees were abandoned. Commercial capital markets were envisaged to improve efficient capital allocation and management. We analyzed the effects of commercial bank loans on interest rates, investments and allocative efficiency in the Dutch healthcare sector. We aimed to explain variation in interest rates by financial performance of healthcare providers, hypothesizing that the reform reduced interest rates for financially well-performing providers. Using financial data from publicly available annual reports, we explored the effect of financial performance on long-term loan interest rates through pooled linear regressions. Our data showed that financial reserves have steadily increased, although profitability margins have declined since 2011-2013 (depending on the sector). While nominal interest rates have generally declined since 2006, the risk surplus on healthcare loans has steadily increased. Furthermore, we observed no significant relation between the financial performance of healthcare providers and interest rates on capital loans. Maintaining additional financial reserves provided no apparent benefit to capital costs. This suggests that healthcare providers may consider whether financial reserves should be maintained at current levels or can better be used for direct investments. Moreover, healthcare policymakers should evaluate whether the increase in risk surplus combined with an apparent lack of reward for financial scrutiny is a desired outcome of the reform.

Improving Performance in Complex Surroundings: A Mixed Methods Evaluation of Two Hospital Strategies in the Netherlands

BACKGROUND

Hospital strategies aimed at increasing quality of care and simultaneously reducing costs show potential to improve healthcare, but knowledge on real-world effectiveness is limited. In 2014, two Dutch hospitals introduced such quality-driven strategies. Our aim was to evaluate contexts, mechanisms, and outcomes of both strategies using multiple perspectives.

METHODS

We conducted a mixed methods evaluation. Four streams of data were collected and analysed: (1) semi-structured interviewing of 62 stakeholders, such as medical doctors, nurses, managers, general practitioners (GPs), and consultants; (2) financial statements of both organisations and other hospitals in the Netherlands (counterfactual); (3) national database of quality indicators, and patient-reported experiences; and (4) existing material on strategy development and effects.

RESULTS

Both strategies resulted in a relative decrease in volume of care within the hospital, while quality of care has not been affected negatively. One hospital failed to cut operating costs sufficiently, resulting in declining profit margins. We identified six main mechanisms that impacted these outcomes: (1) Quality-improvement projects spur change and commitment; (2) increased coordination between hospital and primary care leads to substitution of care; (3) insufficient use of data and support hinder quality improvement; (4) scaling down hospital facilities is required to convert volume reductions to cost savings; (5) shared savings through global budgets lead to shared efforts between payer and hospital; and (6) financial security for physicians facilitates shift towards quality-driven care.

CONCLUSION

This integrated analysis of mixed data sources demonstrated that the institution-wide nature of the strategies has induced a shift from a focus on production towards quality of care. Longer-term (financial) sustainability of hospital strategies aimed at decelerating production growth requires significant efforts in reducing fixed costs. This strategy poses financial risks for the hospital if operating costs are insufficiently reduced or if payer alignment is compromised.

Hospitals Bending the Cost Curve With Increased Quality: A Scoping Review Into Integrated Hospital Strategies

BACKGROUND

A lack of knowledge exists on real world hospital strategies that seek to improve quality, while reducing or containing costs. The aim of this study is to identify hospitals that have implemented such strategies and determine factors influencing the implementation.

METHODS

We searched PubMed, EMBASE, Web of Science, Cochrane Library and EconLit for case studies on hospital-wide strategies aiming to increase quality and reduce costs. Additionally, grey literature databases, Google and selected websites were searched. We used inductive coding to identify factors relating to implementation of the strategies.

RESULTS

The literature search identified 4198 papers, of which our included 17 papers describe 19 case studies from five countries, mostly from the United States. To accomplish their goals, hospitals use different management strategies, such as continuous quality improvement (CQI), clinical pathways, Lean, Six Sigma and value-based healthcare (VBHC). Reported effects on both quality and costs are predominantly positive. Factors identified to be relevant for implementation were categorized in eleven themes: (1) strategy, (2) leadership, (3) engagement, (4) reorganization, (5) finances, (6) data and information technology (IT), (7) projects, (8) support, (9) skill development, (10) culture, and (11) communication. Recurring barriers for implementation are a lack of physician engagement, insufficient financial support, and poor data collection.

CONCLUSION

Hospital strategies that explicitly aim to provide high quality care at low costs may be a promising option to bend the cost curve while improving quality. We found a limited amount of studies, and varying contexts across case studies. This underlines the importance of integrated evaluation research. When implementing a quality enhancing, cost reducing strategy, we recommend considering eleven conditions for successful implementation that we were able to derive from the literature.

Governance of academic medical centres in changing healthcare systems: An international comparison

We provide an explorative and international comparison of the governance models of academic medical centres (AMCs). These centres face significant challenges, including disruptive external pressures and enduring financial conflicts pertaining to patient treatment, research and education. Therefore, we covered 10 European countries (Cyprus, Czechia, Denmark, Germany, Italy, Latvia, the Netherlands, Norway, Poland and Spain) and one associated state (Israel) in our analysis. In addition, we developed an expert questionnaire to collect data on the governance of AMCs in these 11 countries. Our results revealed no standardised definition of AMCs, with countries combining patient care, education/teaching and research differently. However, the ownership of such institutions is significantly homogeneous and is limited to public or private, nonprofit ownership. Furthermore, significant differences are associated with the (functional) integration level between the hospital and medical school. Therefore, most experts believe that the governance of AMCs will evolve into a more functionally integrated model of patient care, research and education.

Unmasking a health care system: the Dutch policy response to the Covid-19 crisis

The Covid-19 pandemic has put policy systems to the test. In this paper, we unmask the institutionalized resilience of the Dutch health care system to pandemic crisis. Building on logics of crisis decision-making and on the notion of 'tact', we reveal how the Dutch government initially succeeded in orchestrating collective action through aligning public health purposes and installing socio-economic policies to soften societal impact. However, when the crisis evolved into a more enduring one, a more contested policy arena emerged in which decision-makers had a hard time composing and defending a united decision-making strategy. Measures have become increasingly debated on all policy levels as well as among experts, and conflicts are widely covered in the Dutch media. With the 2021 elections ahead, this means an additional test of the resilience of the Dutch socio-political and health care systems.

Governance and organization of Academic Medical Centers – a comparative analysis of 11 countries

Background

Academic Medical Centers (AMCs) are organizations that link three functions: providing highly specialized medical services, teaching activities and conducting research. The aim of the study was to provide an international comparison of the governance and organization models of AMCs. The analysis covered 10 European countries (Cyprus, Czechia, Denmark, Germany, Italy, Latvia, Netherlands, Norway, Poland, Spain) and Israel.

Methods

The study has an explorative and descriptive character. The methods involved: (1) the creation of a conceptual framework; (2) the development of a dedicated questionnaire; (3) data collection and analysis. The data was collected based on purposive sampling. There were 26 respondents from 11 countries.

Results

There is no standardized definition of AMCs across countries. Different types of hospital providers do link patientcare, teaching and research. Depending on the country and particular institution, the balance between these three functions, as well as the scope might vary a lot. The majority of the participating countries face either public or not-for-profit ownership for AMCs and medical faculties. However, the relationship between hospital and faculty varies substantially. Main internal governance challenges focus on lack of responsiveness to change and financial conflicts between the three core tasks. External challenges relate to financial sustainability and workforce shortages. Most respondents believe that in the nearby future the governance of AMCs will evolve to a more functionally integrated model of the three functions.

Conclusions

The study fills the gap in the literature on organization and governance of European AMCs. Although, there are substantial differences in the models of governance across countries, many challenges are highly similar. This raises important questions for future research (e.g. focusing solely on one function) as well as policy (the potential for cross-national learning).

Key messages

There is no standardized definition of AMCs across countries and different types of organizations are used to link the three functions of providing patientcare, teaching activities and research. Despite the organizational and legal differences, AMCs in different countries face similar challenges (nimbleness and financial conflicts between the three functions; health workforce shortages).

COVID-19 vaccine challenges: What have we learned so far and what remains to be done?

Developing and distributing a safe and effective SARS-CoV-2 (COVID-19) vaccine has garnered immense global interest. Less than a year after COVID-19 was declared a pandemic, several vaccine candidates had received emergency use authorization across a range of countries. Despite this scientific breakthrough, the journey from vaccine discovery to global herd immunity against COVID-19 continues to present significant policy challenges that require a collaborative, global response. We offer a framework for understanding remaining and new policy challenges for successful global vaccine campaigns against COVID-19 as well as potential solutions to address them. Decision-makers must be aware of these challenges and strategize solutions that can be implemented at scale. These include challenges around maintaining R&D incentives, running clinical trials, authorizations, post-market surveillance, manufacturing and supply, global dissemination, allocation, uptake, and clinical system adaption. Alongside these challenges, financial and ethical concerns must also be addressed.

COVID-19: A Window of Opportunity for Positive Healthcare Reforms

The current coronavirus disease 2019 (COVID-19) pandemic is testing healthcare systems like never before and all efforts are now being put into controlling the COVID-19 crisis. We witness increasing morbidity, delivery systems that sometimes are on the brink of collapse, and some shameless rent seeking. However, besides all the challenges, there are also possibilities that are opening up. In this perspective, we focus on lessons from COVID-19 to increase the sustainability of health systems. If we catch the opportunities, the crisis might very well be a policy window for positive reforms. We describe the positive opportunities that the COVID-19 crisis has opened to reduce the sources of waste for our health systems: failures of care delivery, failures of care coordination, overtreatment or low-value care, administrative complexity, pricing failures and fraud and abuse. We argue that current events can canalize some very needy reforms to make our systems more sustainable. As always, political policy windows are temporarily open, and so swift action is needed, otherwise the opportunity will pass and the vested interests will come back to pursue their own agendas. Professionals can play a key role in this as well.

Case-studies of displacement effects in Dutch hospital care

BACKGROUND

Under a constrained health care budget, cost-increasing technologies may displace funds from existing health services. However, it is unknown what services are displaced and how such displacement takes place in practice. The aim of our study was to investigate how the Dutch hospital sector has dealt with the introduction of cost-increasing health technologies, and to present evidence of the relative importance of three main options to deal with cost-increases in health care: increased spending, increased efficiency, or displacement of other services.

METHODS

We conducted six case-studies and interviewed 84 professionals with various roles and responsibilities (practitioners, heads of clinical department, board of directors, insurers, and others) to investigate how they experienced decision making in response to the cost pressure of cost-increasing health technologies. Transcripts were analyzed thematically in Atlas.ti on the basis of an item list.

RESULTS

Direct displacement of high-value care due to the introduction of new technologies was not observed; respondents primarily pointed to increased spending and efficiency measures to accommodate the introduction of the cost-increasing technologies. Respondents found it difficult to identify the opportunity costs; partly due to limited transparency in the internal allocation of funds within a hospital. Furthermore, respondents experienced the entry of new technologies and cost-containment as two parallel processes that are generally not causally linked: cost containment was experienced as a permanent issue to level costs and revenues, independent from entry of new technologies. Furthermore, the way of financing was found important in displacement in the Netherlands, especially as there is a separate budget for expensive drugs. This budget pressure was found to be reallocated horizontally across departments, whereas the budget pressure of other services is primarily reallocated vertically within departments or divisions. Respondents noted that hospitals have reacted to budget pressures primarily through a narrowing in the portfolio of their services, and a range of (other) efficiency measures. The board of directors is central in these processes, insurers are involved only to a limited extent.

CONCLUSIONS

Our findings indicate that new technologies were generally accommodated by greater efficiency and increased spending, and that hospitals sought savings or efficiency measures in response to cumulative cost pressures rather than in response to single cost-increasing technologies.

The marginal benefits of healthcare spending in the Netherlands: Estimating cost-effectiveness thresholds using a translog production function

New technologies may displace existing, higher-value care under a fixed budget. Countries aim to curtail adoption of low-value technologies, for example, by installing cost-effectiveness thresholds. Our objective is to estimate the opportunity cost of hospital care to identify a threshold value for the Netherlands. To this aim, we combine claims data, mortality data and quality of life questionnaires from 2012 to 2014 for 11,000 patient groups to obtain quality-adjusted life-year (QALY) outcomes and spending. Using a fixed effects translog model, we estimate that a 1% increase in hospital spending on average increases QALY outcomes by 0.2%. This implies a threshold of €73,600 per QALY, with 95% confidence intervals ranging from €53,000 to €94,000 per QALY. The results stipulate that new technologies with incremental cost effectiveness ratios exceeding the Dutch upper reference value of €80,000 may indeed displace more valuable care.

A challenge to all. A primer on inter-country differences of high-need, high-cost patients

BACKGROUND

Across countries, a small group of patients accounts for the majority of health care spending. These patients are more likely than other patients to experience problems with quality and safety in their care, suggesting that efforts targeting efficiency and quality among this population might have significant payoffs for health systems. Better understanding of similarities and differences in patient characteristics and health care use in different countries may ultimately inform further efforts to improve care for HNHC patients in these health systems.

METHODS

We conducted a cross-sectional descriptive study using one year of patient-level data on high-cost patients in seven high-income OECD member countries. Countries were selected based on availability of detailed information (large enough samples of claims, administrative, and survey data of high-cost patients). We studied concentration of spending among high-cost patients, characteristics of high-cost patients, and per capita spending on high-cost patients.

FINDINGS

Cost-concentration of the top 5% of patients varied across countries, from 41% in Japan to 60% in Canada, driven primarily by variation in the top 1% of spenders. In general, high-cost patients were more likely to be female (57.7% on average), had a significant number of multi-morbidities (up to on average 10 major diagnostic categories (ICD chapters), and had a lower socioeconomic status. Characteristics of high-cost patients varied as well: median age ranged from 62 in the Netherlands to 75 in Germany and the difference in socioeconomic status is particularly stark in the US. Lastly, utilization, particularly for inpatient care, varied with an average number of inpatient days ranging from 6.6 nights (US) to 97.7 nights in Japan.

INTERPRETATION

In this descriptive study, there is substantial variation in the cost concentration, characteristics, and per capita spending on high-cost patient populations across high-income countries. Differences in the way that health systems are structured likely explains some of this variation, which suggests the potential of cross-system learning opportunities. Our findings highlight the need for further studies including comparable performance metrics and institutional analysis.

ParkinsonNet: A Low-Cost Health Care Innovation With A Systems Approach From The Netherlands

ParkinsonNet, a low-cost innovation to optimize care for patients with Parkinson disease, was developed in 2004 as a network of physical therapists in several regions in the Netherlands. Since that time, the network has achieved full national reach, with 70 regional networks and around 3,000 specifically trained professionals from 12 disciplines. Key elements include the empowerment of professionals who are highly trained and specialized in Parkinson disease, the empowerment of patients by education and consultation, and the empowerment of integrated multidisciplinary teams to better address and manage the disease. Studies have found that the ParkinsonNet approach leads to outcomes that are at least as good as, if not better than, outcomes from usual care. One study found a 50 percent reduction in hip fractures and fewer inpatient admissions. Other studies suggest that ParkinsonNet leads to modest but important cost savings (at least US$439 per patient annually). These cost savings outweigh the costs of building and maintaining the network. Because of ParkinsonNet's success, the program has now spread to several other countries and serves as a model of a successful and scalable frugal innovation.

Fiscal rules, powerful levers for controlling the health budget? Evidence from 32 OECD countries

BACKGROUND

Publicly funded healthcare forms an intricate part of government spending in most Organisation for Economic Co-operation and Development (OECD) countries, because of its reliance on entitlements and dedicated revenue streams. The impact of budgetary rules and procedures on publicly funded health care might thus be different from other spending categories. In this study we focus on the potential of fiscal rules to contain these costs and their design features.

METHODS

We assess the relationship between fiscal rules and the level of public health care expenditure of 32 (OECD) countries between 1985 and 2014. Our dataset consists of health care expenditure data of the OECD and data on fiscal rules of the International Monetary Fund (IMF) for that same period. Through a multivariate regression analysis, we estimate the association between fiscal rules and its subcategories and inflation adjusted public health care expenditure. We control for population, Gross Domestic Product (GDP), debt and whether countries received an IMF bailout for the specific period. In all our regressions we include country and year fixed effects.

RESULTS

The presence of a fiscal rule on average is associated with a 3 % reduction of public health care expenditure. Supranational balanced budget rules are associated with some 8 % lower expenditure. Health service provision-oriented countries with more passive purchasing structures seem less capable of containing costs through fiscal rules. Fiscal rules demonstrate lagged effectiveness; the potential for expenditure reduction increases after one and two years of fiscal rule implementation. Finally, we find evidence that fiscal frameworks that incorporate multi-year expenditure ceilings show additional potential for cost control.

CONCLUSIONS

Our study shows that there seems a clear relationship between the potential of fiscal rules and budgeting health expenses. Using fiscal rules to contain the level of health care expenditure can thus be a necessary precondition for successful strategies for cost control.

The arduous quest for translating health care productivity gains into cost savings. Lessons from their evolution at economic scoring agencies in the Netherlands and the US

We analyze the assessments of recent health reforms by the Congressional Budget Office (CBO) in the United States and the Bureau for Economic Policy Analysis (CPB) in the Netherlands. Both reforms aim to capitalize on productivity gains, which is appealing for policymakers because of the potential for cost savings while maintaining - or enhancing - quality and access. These measures however generally translate into more health care, rather than care that is affordable and appropriate. Scoring agencies therefore have rightfully been reluctant to assign significant savings to these measures. Thus with regard to cost savings, both agencies instead have favored more traditional policy measures in the past. They are however increasingly mapping out loose ends and dilemmas for payers, including information asymmetries, reputation issues and provider business models that contradict the goals of policymakers. This calls for further exploring this avenue and the development of more integrated agendas that might commit actors and the spread of best practices.

The influence of fiscal rules on healthcare policy in the United States and the Netherlands

Governments use fiscal rules to put a framework and limits on how budgetary challenges are addressed, but the rules themselves are still an understudied area among health policy scholars. For a long time, healthcare held a somewhat separate status because of the reliance on entitlements and dedicated revenue streams. However, the combined forces of advocates for integral decision-making, central budget control and the increasing costs might shift healthcare towards budgetary frameworks that currently apply to other spending categories. In this paper, we study fiscal rules that the US and the Netherlands have adopted since 2010 and their impact on healthcare policy. Our analysis shows that fiscal rules can have an impact on the rationing of healthcare. In the studied timeframe, the rules seem to have more impact on budget outcomes than on the budget process itself. In addition, the convergence of fiscal and program policy objectives seems to be better accomplished in a budgetary system that applies enforceable budget ceilings. Budgeting for health entitlements requires a comprehensive and tailor-made approach and the composition of traditional rules might not fully answer to the complexities of healthcare policy. This paper aims to contribute to that debate and the way we think about healthcare budgeting. Copyright © 2016 John Wiley & Sons, Ltd.

Uncomfortable realities: the challenge of creating real change in Europe's consolidating hospital sector

BACKGROUND

This article examines uncomfortable realities that the European hospital sector currently faces and the potential impact of wide-spread rationalization policies such as (hospital) payment reform and privatization.

METHODS

Review of relevant international literature.

RESULTS

Based on the evidence we present, rationalization policies such as (hospital) payment reform and privatization will probably fall short in delivering better quality of care and lower growth in health expenses. Reasons can be sought in a mix of evidence on the effectiveness of these rationalization policies. Nevertheless, pressures for different business models will gradually continue to increase and it seems safe to assume that more value-added process business and facilitated network models will eventually emerge.

CONCLUSIONS

The overall argument of this article holds important implications for future research: how can policymakers generate adequate leverage to introduce such changes without destroying necessary hospital capacity and the ability to produce quality healthcare.