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Statistical Office in Krakow Centre for Health Statistics

Statistical Office in Krakow Centre for Health Statistics. Health care sector in Poland: the history of financing and organization. Health care system prior to 1989. SIEMASZKO MODEL

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Statistical Office in Krakow Centre for Health Statistics

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  1. Statistical Office in Krakow Centre for Health Statistics Health care sector in Poland: the history of financing and organization

  2. Healthcare system prior to 1989 SIEMASZKO MODEL • Public health service model typical for eastern communistic countries - members of the Union of Soviet Socialists Republics (ZSRR) • Centralized health care – all decisions made on the state level by Communistic Party leaders • State-owned health care facilities • Financing from general taxation

  3. Consequences • Chronic overstaffing • Low level of motivation / decline in moral standards • Declining efficiency • Insufficient salaries for healthcare professionals (corruption)

  4. Quasi market of healthcare services between 1990 – 1998 (a period of transition) • Introducing the universal coverage with a comprehensive program of health care • Distributing services through facilities owned and run by the state • Financing from general taxation (the Ministry of Health) • Initial steps to decentralization of ownership and private ambulatory medical services • Implementation of “family doctor scheme”

  5. Consequences • Over centralization • Over specialization • Regional inequalities • Regional rationing and misallocation of resources • Problem of informal payments to public health care providers • Lack of costs awareness

  6. highly developed health care financing system meet the health care needs of population byproviding health care servicesof high quality AIM of the reforms:

  7. Legislation’s Acts • 1989 Act on the Establishment of a Medical Chamber • 1990 Local Government Act • 1991 Health Care Institutions Act • 1991 Nurses and Midwives Self Government Act • 1991 Act on Payment for Drugs and Medical Materials • 1993 Law on Abortion • 1994 Law on Nurse and Midwives Professions • 1995 Regulations on transfer of budgets to self-managing institutions • 1997 Law on Physicians Profession • 1997 Law on Universal Health Insurance • 1997 General Health Care Act • 1998 Law on Universal Health Insurance – Amendments

  8. 1997 General Health Care Act • Universal participation • Mandatory principle • Social solidarity • Autonomous and self-governing scheme • The state guarantees the security of the insurance scheme

  9. Reform of the administration systemin Poland 49 voivodships 16 voivodships

  10. Health care system after reform 1st of January 1999 (1) • National health insurance program based on Bismarck’s social health insurance model • Compulsory health insurance scheme (for all citizens) • Decentralization – transfer of decision rights from the state level to regional and local levels • Sickness Fund as a third player - payer (16 insurance founds + 17th found for different groups of proffesionals) • Introduction of the primary healthcare institution (POZ) – general practitioners play a role of gate keepers

  11. Health care system after reform 1st of January 1999 (2) • Financing: • health insurance contribution – 7,5% of income – monthly deducted by employer and paid directly to the insurance found • unemployed and retired – contribution covered by the state • out-of-pocket payments • Introduction of a hospital accreditation system • Patients’ right to choose healthcare provider • Contracting health care services as a new tool of planning and control • Market competition between providers

  12. Diversity of responsibility on governmental levels (2) Voivodship (Regional level): • secondary care in voivodship hospital • providing acute care • planninghealthcareservices, organizing the structure of health institutions • allocating founds Powiat (District, local level): • the owners of health care organizations within their territory • district hospitals Gmina (Municipality): • primary care

  13. Consequences • Misuse of market mechanism in terms of high autonomy among Sickness Founds • Increase of public expenditures on inpatient care and drugs reimbursement • Wrong allocation of resources • Inequalities between Sickness Founds locatedindifferent voivodships • Growth of out-of-pocket expenditures + informal co-payments • Increase of public expenditures due to high rate of unemployment

  14. Health care system after reform 23rd of January 2003(1) • Sickness Funds were replaced by theNational Health Fund (NFZ) with 16 regional branches + 1 central • NFZ located out of the public budgetary finance construction • Centralization of responsibility for financial and human capital service plan realization • The Insurance Law - insurance contribution will increase from 8.25% in 2004 to 9% in 2007 • Many providers combine a private practice with part-time employment in the public sector

  15. Health care system after reform 23rd of January 2003 (2) • Creation of a Polish Health Technology Assessment Agency • Introducing a system of waiting lists but not for emergency services • Introducing the National Drug Policy (transferring the market share from branded to generic drugs) • Introducing the basic package of health careservices • Hospital networks

  16. Dimensions of the analysis of health care sector financing in Poland Financing of the health care services Production of the health care services Functionsof the health care services Kind of cost Curative and rehabilitative care Financing sources Financing agents Providers The National Health Fund Salaries Independent health care units (SPZOZ) Long-term care Insurance contribution Pharmaceuticals and medical equipment Provision of health care services Dependent health care units (NZOZ) State budget Taxes Health administration and health insurance Non-medical costs of treatment Territorial self-government units Offices of physicians and dentists Employer’s expenditures Administration Ancillary services to health care Medical care centres (ZOL) Households Upkeepof infrastructure Household’s disposable incomes Prevention and public health Nursingcentres (ZPO) Outsourcing Employers Functioning of the system Investments Private insurers Pharmacies

  17. Financing sources – health insurance contributions Health insurance contributions - the biggest financing source • In Poland, the universal health insurance system has been in effect since 1 January 1999, when the health care contribution was introduced • Contributions are transferred to the payer - National Health Fund (NFZ) from the Social Insurance Institution (91% of the total, the real growth of financial means acquired from this source in the period of 2000-2007 amounted to 48%) as well as from the Agricultural Social Insurance Fund. The total growth of revenues higher than the GNP one. • The majority of Poles are subject to obligatory health insurance. Persons who are mentioned in Art. 66 item 1 of the Law on health benefits financed from public means are subject to obligatory health insurance, whereas persons mentioned in Art. 68 of the Law are subject to voluntary health insurance • From the moment, when system was introduced, the general revenues from contributions expressed in current prices has risen by 19 bilions of zl (around 80%) - the health insurance contribution’s rate has risen from 7,5% of the base in 1999 to 9,0% in 2007

  18. Financing sources (2) - taxes For some insured persons the health insurance contributions arefinanced directly from the budgetary revenues: farmers, unemployed without the benefit, persons receiving child-care benefits and war pensions, soldiers The stable level of budgetary financingis predicted in the future Expenditure on health care, which comes from the state budget, is spent by: the Ministry of Health, the Ministry of Interior and Administration, the Ministry of National Defence, the Ministry of Justice as well as the Ministry of Labour and Social Policy Level of financing; stable for 2004-2006 (around 4 bln zl), some growth since 2007 – financing emergency service. The flow of funds mainly in form of the purposefulsubsidies

  19. Financing sources (3) - employer’s expenditures Law on Occupational Medicine Service: employers (corporations) are obliged to finance occupational medicine services (preliminary, periodic andcontrol medical examinations, as well as preventive care related to working conditions) for their employees Financing of medical services including diagnostics, often combined with preventive medical examinations, within medical subscription packages purchased by employers at health care institutions Expenditure on preventive medical examinations is employer’scosts of obtaining income Arapid growth of financial means: from 545 mln zl in 2002 to 1,3 bln zl in 2007

  20. Financing sources (4) – Households’ disposable incomes Estimation: based on householdbudgets survey, household notes its expenditure and incomes in a special budgetary book Net income= combination of funds in household disposition –(prepayment for income tax from natural persons + contributions for social and health insurances) + savings Net income =disposable income + savings The average monthly expenditure on health care per capita incurred by households amountedto36.57 zl in 2006 The total amount of direct health care expenditure incured by households in 2006 amounted to: 16,8 blnzl* * stands for minimal direct health care (out-of-pocket) expenditurebeard by households,since it may not include the informal payments for health care services.

  21. Production of the health care services – costs in the health care system in Poland The total costs of the health care system has been rising steadly: from 41,6 bln (1999) to 70,4 bln (2007) – 70% Main causes of rapid growth: • results of requirements regulated in the „ustawa 203” – independent health care units (SPZOZ) had to incur debts in order to finanse the increasing value of personel salaries, • Law on Pubic Aid and restructurizationof the independent health care unitsof 15April2007 was established to solve this problem. Additional costs for SPZOZ: preparation of restructurization plans.

  22. Costs in the health care system – main trends Significant increase in salaries-related costs and costs of drugs: a growth by 12,2% in 2006 and nearly 8% in 2007 respectively. Rapid growth also for other kind of costs: medical materials, orthopaedic equipment, electricity, out-sourcing, upkeep of infrastructure, non-medicalcosts of treatment. Thebiggest part = personel salaries + cost of drugs A recentdomination: before 1999 – salaries, 2000-2006 – costs of drugsDrugs: 37% of thetotalin2003, latterimprovement – 31% in 2007 !!! The most dynamic trend - financial liabilitiesin form of taxcharges and debtsrepayment; a growth by 728% for 1999-2007. Noticableimprovement: a decrease by 16% for 2004-2007 – enormoushospitaldebtisdecreasing.

  23. Total health care expenditure – OECD comparison Where we are??? Comparison with selected OECD countries • Conclusion: • level of total expenditure on health care in Poland, Mexico and Turkey belongs to the lowest among the OECD countries

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