Getting Better Value for Money from Sweden’s Healthcare System

1. Getting Better Value for Money from Sweden’s Healthcare System By David Rae Presented by Allison Pokky

2. About the Author • David Rae holds a Master of Science in Economics from the London School of Economics. He is the Head of Infrastructure at the New Zealand Superannuation Fund. Prior to joining the NZSF, he was Head of the European Union/Ireland Country Desk at the OECD in Paris. He was also an Economist at the National Bank of New Zealand.

3. Overview of Sweden’s Healthcare System • An old but healthy population • Largest proportion of old people in OECD • Healthy Lifestyles • Healthcare system is highly decentralized • Integrated public healthcare system • Main responsibility lies with 20 county councils and one local authority • Financed mainly through income taxes • Private funding around 15%

4. Strengths • Quality appears to be high • Sweden does well in international healthcare comparisons • Ranked first out of 19 OECD countries for standardized death rates • Performs well in other OECD disease based comparisons as well • System is innovative and flexible • County councils choose operational structure • Leading edge of international trends in healthcare

5. Strengths • Evidence-based medicine used to raise quality • Leader in use of medical databases to improve quality of treatment • Considerable Patient Choice • Patients have freedom to choose where and by whom they will be treated • Can choose primary care clinic, GP and preferred hospital • Also have a choice between being treated at a health center or hospital outpatient center

6. Challenges • Improving access to primary care • Shortage of family doctors • Short hours • Higher incomes have better access to primary care • Cutting waiting times for elective surgery • National treatment guarantee • “0-7-90-90” rule • Does not reduce median waiting time as a whole

7. Challenges • Transition from hospital care to social care is not smooth • Patients sent home quicker and sicker • Municipalities can’t employ their own doctors • Care sector wage levels are low and staff turnover is high • Funding does not match aspirations of the system • The system is too fragmented • Parts of the system are too small • Need a more efficient hospital sector • Large variations in efficiency levels between county councils

8. Challenges • Improving control over pharmaceutical spending • Monopoly over retail distribution of drugs • Raises prices and lowers service quality • Make financing more stable and sustainable • Tax revenues cannot finance the expansion of elderly care and healthcare in the future • Budget constraint is too soft • Healthcare spending is pro-cyclical

9. Suggestions for Reform • Improve access to primary care by making it easier to become a family doctor • Encourage GPs to work longer hours • Adjust the Waiting Time Guarantee to reflect that those in the most need are treated first • Reduce fragmentation • Reduce number of counties from 20 to 12 or fewer

10. Suggestions for Reform • Expand customer choice and private provision in elderly care • Reduce regional variations in quality and medical practice • Abolish drug monopoly • More stable and sustainable financing • Reduce cyclical influence on county council budgets • Consider a mandatory insurance as a way of funding part of the system