An overview of French experience in contracting

1. An overview of French experience in contracting M.M. Bellanger Wednesday 11 March

2. CONTENTS • Underlying rationale for contracting • Hospital contracting • GP contracting • The case of chronic disease

3. Underlying rationale • “The search of the Holy Grail: combining decentralised planning & contracting in the French health care system” • Bellanger & Mossé Health Economics 2005 • French system: hospital based system (see Act 2009: “Hospital Patient Health & geographical area” (see A. Jourdain)

4. Underlying rationale • Two main objectives • Resource allocation: making financial resource limitation compatible with increasing needs • Rationalisation of means • Contract: a major regulation tool, since 1991, first and then 1996 (Economists’ report 1992) • Changes affecting hospital payment have been the frame for this contracting – constraint governance of hospitals • Larger move included in the so-called “Modernisation of the State” & or “new public management in most of European countries

5. Hospital contracting • For hospital governance, the regional devolution (see E. Ciotti), did not have relied on existing local or regional actors (e.g. local or regional councils, Regional directorate for health & social actions) but not on a new player: the Regional Hospital Agency in 1996. • “Acceleration of this move” the newly created Regional Health Agency – ARS- (in place of RHA, Regional health insurance fund, local & regional directorate…) • Still opposition between centralism & decentralisation: Regional Prefects will have a “droit de regard” on ARS

6. Hospital contracting • Two types of State intervention involved in the game: • 1. Innovative State intervention: Contracting is based on commitment between each hospital & its agency (RHA): internal contract (pole contract) and external negotiation (compulsory contract through Regional Health Plan, so called SROS3, based on “medical territory project” & authorisation constraint) • For a better distribution of hospital services in a given area (priority setting according to health needs!) • For improving quality of care • For renovating hospital buildings (2007 hospital plan (launched in 2003; and 2012 plan)

7. Hospital contracting • 2. A technical and “planning” type of intervention: • Norms & standard defined at the national level • Financial issues decided at central level too • National tariffs • No power for Region (maybe no will) for raising funds, such as in Italy, or Spain or Germany. • Still two logics persisting : • Top down for financing • Down top for project (see following slide)

8. French System State Health policy REGION SROS & public health plan ARH/ARS TOP DOWN HEALTH TERRITORY MEDICAL PROJECT QUANTIFIED OBJECTIVES WITHOUT OPERATIONAL GOUVERNANCE DOWN TOP HOSPITALS CONTRACTS ACTIVITY BOARD 8

9. From hospital contracts to new contractors • Room for improvement • Core question is incentive (Principal – Agent relationship) • Hospital: no interest to reveal its strategy to the Regional Agency • Regional Agency/ policy maker: does not enjoy the useful information to allocate resources optimally. • Opportunity of the new Regional Health Agency to enlarge its domain for action

10. From hospital contracts to new contractors • Opportunity of ARS: • Hospitals, ambulatory care, social & elderly care • Community of hospitals, and cooperation public & private on a given area • This may require some changes in both hospital and GPs payment system (see capitation payment as in Emilia Romagna, California) • This may require not the same organisation procedure all over the country • ARS legitimacy might found by taking some distance from the “centre”

11. GP contracting 1.The case of chronic disease 2. The case of « medecin traitant »

12. Managing chronic disease • Health Insurance reform (August 2004) • Rationale for reform: burden of chronic disease • 12% of insured people & 60% of health expenditure • Annual average reimbursement per insured : 7 068 € (with 10 900 € for the first year , & 25 800 € for the last year) • Hospital reimbursement: 57.8% (i.e. high level), drugs: 20% • Increase of chronic disease patients (5.7% between 1994 & 2004, especially for diabetes & cancer)

13. Managing chronic disease • New model for managing chronic disease patients • New prevention approach for GPs through collective programmes of public health • 2005, new contract (convention) between Gps and health insurance funds: • implementation of care protocols based on Haute Autorité de Santé (HAS “French Nice”) recommendations • In order to decrease inpatient care

14. Managing chronic disease • GP – so called in French “médecin traitant – treating physician” – chosen by the patient • “cornerstone” of chronic condition management : coordinated care “patient journey” • New GP contract includes: • Prevention • Primary care • Orientation of patient within health system, & coordination with other health professionals • Information diffusion for continuity of care

15. Managing chronic disease • But the question of incentives and payment arise • See following slide

16. And question of continuity of care ?

17. Managing chronic disease • New incentives for GPs : bonus per “chronic patients” (Health insurance funding for care coordination) • 50€ per patient in 2005 • Most of “chronic patient have a “Medecin traitant.

18. Busse 2008 WHO observatory

20. Health professional contracting: Reseaux/network • A network model basis of a public-private mix and free association • To improve the access, the coordination the continuity and inter-professional care of patient • Importance of evidence based clinical protocols • Training of care professionals • Education and prevention for patients