Healthcare Reforms and Pharmaceuticals Lessons from Turkey

1. Healthcare Reforms and PharmaceuticalsLessons from Turkey Prof. Dr. Mehtap Tatar Hacettepe University Faculty of Economics and Administrative Sciences Department of Health Care Management

2. Agenda General health care reforms Impact of reforms Reforms in pharmaceutical policies

3. Health Transformation Program2003 - Purchaser-provider split Family practitioner scheme General health insurance Hospitals with administrative and financial autonomy

4. Extension of family practitioner scheme Transfer of SSK hospitals Extension of private hospital use Pilot family practitioner scheme Introduction of GHI Health campuses Use of private pharmacies by SSK 2010 2003 2008 2004 2011 2005 Coverage of population under 18 Extension of Green Card Benefits Full time and university performance based system Performance based payment Major reform initiatives

5. Impact of the program Improved access Increased share of private providers Increased satisfaction with the system Increased health expenditures

6. Improved access • Before reforms, among those who felt health care need: • 13% did nothing • 19% used self treatment • 30% used self prescribed medicine (National Health Accounts Household Survey, 2003)

7. Outpatient visit per person per year MoH

8. Increasing share of private providers Number of outpatient visits to private hospitals MoH

9. Increased satisfaction (%) MoH

10. Increased health expenditures Health Expenditure/GDP (%)

11. Pharmaceuticals

12. Pricing of pharmaceuticals • External reference pricing • cheapest of France, Greece, Italy, Portugal, Spain • Public price • Public discount on retail price (currently 41% for originals) • Internal reference pricing • Cheapest + 10%

13. External reference pricing Pozitive list Reimbursement commission 20% co-payment for Green Card 2009 2004 2007 2005 2006 Generic price 66% of the original Internal reference pricing cheapest + 22% VAT to 8% Internal reference pricing cheapest+ 30% Major pharmaceutical regulations

14. Internal reference pricing cheapest + 15% 32,5% public discount for originals 3D Barcode system introduced 2010 2010 2010 2011-????? Global budget 2010:14,6 billion TL 2011: 15,6 billion TL 2012: 16,7 billion TL New GMP regulations Major pharmaceutical regulations

15. Total pharmaceutical expenditure (billion TL) Performance based payment system Increased use of private hospitals Family Practitioners Coverage of population under 18 Transfer of SSK Hospitals Health campuses Autonomous hospitals Extension of Green Card benefits www.aifd.org.tr

16. Issues on the agenda Health Technology Assessment Further discounts Rational drug use Restrictions on prescriptions

17. Thank youmtatar@hacettepe.edu.tr

18. Internal reference pricing cheapest + 15% 32,5%discount for originals 3D Barcode system introduced 2010 2010 2010 2011 - ??? New GMP regulations Global Budget Billion TL 2010: 14.6 2011: 15.6 2012: 16.7 Major pharmaceutical regulations

19. Reorganization of the MoH2.11.2011 • Turkish Medicines and Medical Devices Agency • Market regulation • Marketing approval • Pricing (pharmacoeconomic analysis for pricing)

20. Health Implementation Guideline 5.11.2011 • Changes in public discounts • Originals without generics 41% • Originals with generics 28% • Generics 28% • Internal reference pricing cheapest + 10%

21. Points to consider • Impact analysis of reforms is crucial? • What are the drivers for increasing expenditures • Isolated emphasis on spending or utilization alone can be problematic • What is the limit for discounts? • Who will be most affected by discounts?

22. Thank you!mtatar@hacettepe.edu.tr