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Addressing the demand side problems by Intelligent Co-payment Scheme

Addressing the demand side problems by Intelligent Co-payment Scheme. C ontribution to the Roundtable discussion Paying for the Health Systems of the Future 7th European Health Forum Gastein Ing. Peter Pažitný, MSc. Analyst of M.E.S.A. 10 Advisor to the Minister of Health October 2004.

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Addressing the demand side problems by Intelligent Co-payment Scheme

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  1. Addressing the demand side problemsby Intelligent Co-payment Scheme Contribution to the Roundtable discussion Paying for the Health Systems of the Future 7th European Health Forum Gastein Ing. Peter Pažitný, MSc.Analyst of M.E.S.A. 10Advisor to the Minister of Health October 2004 MOH

  2. ... ??? ... We're lucky that the hole is not on our side MOH

  3. Content • Introduction – Slovakia at the Glance • The design of The Intelligent Co-payment Scheme • Evidence from introduction of marginal costs in Slovakia MOH

  4. I. Introduction - Slovakia Population: 5,4 million people Living Standard: 51% of EU average Middle income country EUR 1 = SKK 40 MOH

  5. Slovakia at the Glance Source: M.E.S.A. 10 MOH

  6. Deficit of Public Finances (% of GDP) MOH

  7. Slovakia the leader in Reforms • Tax Reform (2003) – Corporate and Personal Income Tax – 19 % • Pension Reform (2003) – Two pillars - public (50%) and private (50%) • Public Administration Reform (2004) – Fiscal Decentralization • Labour Market Reform (2003) – Modern Labour Code • Health Care Reform - Stabilization (2003) - Reform Acts (2004) MOH

  8. Health System in Slovakia MOH

  9. Generally, you have 4 types of problems • Demand side • Supply side • Financing • Regulation (Role of the MOH) MOH

  10. II. The design of Intelligent Co-payment Scheme Act on Basic Benefit Package Basic Principle: Equal treatment to equal need. MOH

  11. A European health politician (old type) speaks: „I oppose higher co-payments because thisinstrument is not likely to reduce the demand for health care. But in case that demand is effectively reduced by higher co-payments, I am also against this instrument because demand is effectively reduced.“ Source: Osterkamp, R., 2004 MOH

  12. Intelligent Co-payment Scheme (ICo-PS) • Separation of non-health care services (setting small, flat co-payments) • Define the national priority list (diagnosis with no co-payment) – The Basic Benefit Package • Establish catalogization committees (defines the catalogue of procedures) • Establish categorization committees (defines the financial co-payment) • Increase patient’s responsibility and involvement MOH

  13. 1. Application of marginal co-payments MOH

  14. 2. List of Citizens’ Priorities Source: FOCUS, January 2004 MOH

  15. Vysoká miera spoluúčasti è è êêPARLIAMENTêê 5 è Low participation è HIC 3 Optimálna výška è spoluúčasti è è 3 Ministry Experts 2. ICo-PS model inpractice 1 2 3 ... cca 9 000 Critical Risks: • financial protection of patients against the risk of excessive costs • urgent care • chronic diseases DISEASES - HIC coverage -patient’s participation MOH

  16. 5. Patient’s responsibility (§ 41) HEALTH IS AN INDIVIDUAL GOOD (NOT A PUBLIC GOOD) Materialized responsibility of the patient for prevention and treatment regime (compliance) The Health Insurance Company is entitled to • Increase the co-payment if the care had to be provided due to a violation of the treatment regime or in result of a habit-forming substance abuse (no compliance), • Decrease the co-payment, if the insured regularly undertakes preventive examinations, preventive vaccination and leads a healthy way of life. MOH

  17. Analyzer Tool MOH

  18. Summary: Elements of an intelligent design of co-payments MOH Draft Yes Yes Yes Partially Not yet Dr. Osterkamp, ifo Institute Munich, 2004: • High co-payments (may be 100%) for small, frequent, cheap and every day diseases • Low (or non) co-payments for rare, severe and costly diseases • Lower co-payments for the poor than for the wealthy. • Upper limit of health-care costs as a % of individual annual income • Disburdening the employer: once-and-for-all increase of wages by former employer contribution MOH

  19. A European health politician (new type) speaks: „On one hand I still oppose higher co-payments. But on the other: • our co-payment rates are rather low, • not each health treatment is equally important, Therefore, I shall try to convince the electorate that a moderate increase combined with a fair design of co-payments is in the interest of all.“ Source: Osterkamp, R., 2004 MOH

  20. III. Evidence: Impact of marginal co-payments(Index 2003/2002) Zdroj: VšZP, 2004 Source: General HIC MOH

  21. Dynamics of Drug Expenditures Zdroj: MZ SR MOH

  22. The access to care was not hurt Source: FOCUS January 2004 MOH

  23. The prescription of drugs was not hurt Source: FOCUS January 2004 MOH

  24. Access to care was not decreased The initial hypothesis came true, that • Only excessive demand felt down • The access to care was not decreased • The perception of corruption decreased (from 32 to 10%) MOH

  25. Lessons learned Reform requires many clear decisions on day-to-day basis ... but .... you always have only imperfect data and information to support your decision MOH

  26. Lessons learned Whatever you do, according to the media and public … you are always WRONG! MOH

  27. Thank you for your kind attentionwww.reformazdravotnictva.skwww.health.gov.sk MOH

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