Blockchain Papers

Eric R. Kingson, Molly W. Checksfield

White House Conferences on Aging, held roughly every 10 years since 1961, have “generated ideas and momentum prompting the establishment of and/or key improvements in … programs that represent America’s commitment to older Americans” (The White House, 2015a). In terms of economic security, notably, the 1961 conference gave a push to the enactment of Medicare by recommending the provision of medical care for the aged through Social Security (Senate Special Committee on Aging, 1961). In 1971, President Nixon advocated inflation-proofing Social Security benefits, saying “It does not make sense to have … benefits constantly behind inflation” (Nixon, 1971), language backed-up when he signed the 1972 amendments to the Social Security Act implementing automatic cost of living adjustments (the “COLA”). While unlikely that this year’s conference will see the fruits of its labor enacted into sweeping policy change in the near term, it could play an important agenda-setting role for future congresses and presidents if conference planners and delegates: Explicitly reject the “entitlement crisis frame” and language; Advance the intergenerational understanding of Social Security; Highlight economic insecurity among today’s seniors Sound the alarm on the looming retirement income crisis; Consider benefit increases in Social Security as a critical option Once a neutral budget term, “entitlement” has taken on new meaning in policy, media and even everyday discourse—one that diminishes the dignity of the old and contributes to the mis-framing of policy discussions about the economic consequences of the aging of America. Conference planners and participants should reject “entitlements” language and urge politicians and the press to do likewise. Here’s why. Americans properly understand Social Security and Medicare as benefits they have earned through lifelong contributions from their (or a family member’s) earnings, not as a “hand-out.” Medicaid, in turn, ensures that the poor as well as many very sick Americans obtain needed health care. Subtle or not, “entitlement” terminology implies that somehow such benefit protections are not deserved. Intended or not, the language chips away at the self-esteem and reinforces negative stereotypes that somehow the old—like spoiled, overly entitled children or adults—are demanding and taking more than they deserve (Altman & Kingson, 2015). The terminology of entitlement is functional for those wanting to scale-back or otherwise radically change—Social Security, Medicare, and Medicaid. Rather than frontally attacking these popular programs, it allows them to obfuscate their intentions by attacking “entitlements.” Lumping these programs together as a “unified entitlement problem” provides a convenient frame for advancing and reinforcing the claim that entitlement spending is the largest cause of federal deficits and the national debt, and that left unchecked this spending will bankrupt the nation. As William Greider writes in The Nation, the political consequences of this shift in meaning are not benign: For many years, the smug elites of Wall Street have peddled “entitlement reform” as a sly euphemism for cutting Social Security. And Washington’s political elites, including President Obama, bought into the propaganda. Social Security, not to mention Medicare and Medicaid, was driving the nation into ruinous debt if government did not act to curb this venerable New Deal program. Think tanks and editorial writers, political reporters and TV talkers, witlessly embraced the big lie and promoted it as indisputable truth (Greider, 2014). Equally problematic, the terminology of “entitlement,” “entitlement problem,” and “entitlement crisis” distracts attention from tax spending sprees (e.g., profligate tax cuts and expenditures primarily benefitting well-off constituencies), two wars paid for with credit cards, financial mismanagement leading to the near collapse of our economy, and widening inequalities of income and wealth. Whatever the problem, this frame offers cuts to spending on Social Security, Medicare, and Medicaid as solution. At any one point in time Social Security serves all age groups and, over time, all generations. Princeton economist J. Douglas Brown, an architect of the Social Security Act, spoke eloquently of Social Security as a covenant reaching across generations and arising from a commitment to mutual responsibility that undergirds civilization. This covenant “underlies the fundamental obligation of the government and citizens of one time and the government and citizens of another time to maintain a contributory social insurance system” (Brown, 1977, 31–32). The most important source of income for retirees, Social Security is also working American’s most reliable disability insurance and the nation’s largest children’s program. Indeed, 3.4 million dependent young children and one million dependent adults disabled before age 22 receive benefits each month. The most significant source of income flowing into the homes of 7.4 million children being raised by grandparents or other older relatives, Social Security is also the most important life and disability insurance working parents have, protecting nearly all of the nation’s 74 million children. As important as Social Security is for today’s old, it is likely to be even more so for today’s young- and middle-aged workers. Indeed, it is they who have more at stake if benefits are cut or expanded (Altman & Kingson, 2015). Unfortunately, in policy discourse Social Security is often presented—by both friends and foes—as if it is only a program for the old. And, the prime sponsor of this year’s WHCOA contributes to this mischaracterization. The President’s 2007–2008 presidential primaries and general election campaigns and the White House website provide case in point. Unionists, women, religious groups, environmentalist, and the like were listed among the 25 or so groups providing special support for candidate Obama (e.g., “_____ for Obama”). “Seniors for Obama” was nowhere to be found on this list. Instead, seniors were assigned to the “Issues” section of the website under “Seniors and Social Security.” The problem here is that “Seniors” are not issues, and, “Social Security” benefits and policy concerns everyone, not just seniors. A one-time occurrence would be of little concern. But in spite of requests by supporters engaged in the campaign and followed by similar requests at White House meetings, “Seniors” and “Social Security” remain joined under the “Issues” tab on The White House (2015b) website (see Figure 1). Seniors are not issues. Like the contemporary use of the word “entitlement,” intended or not, defining seniors as “an issue” is, at best, inaccurate, and, at worst, disrespectful. And presenting Social Security narrowly as an issue primarily of concern to the old misframes policy discussions. So, it is time for the White House to push the “reset” button… Language frames issues and conveys attitudes. Like the contemporary use of the word “entitlement,” intended or not, defining seniors as “an issue” is, at best, inaccurate, and, at worst, disrespectful. And presenting Social Security narrowly as an issue primarily of concern to the old misframes policy discussions. So, it is time for the White House to push the “reset” button with regard to how it talks about older Americans and Social Security. Failing this, the WHCOA delegates could perform an important service by raising such concerns. By virtually any measure, the economic status of the old has, on average, improved since the 1950s, with, for example, poverty rates declining under the official poverty measure from roughly 35% in 1959 to 9% today (15% when the Census Bureau’s new Supplemental Poverty measure is used). But contrary to stereotypes, most seniors are not living on easy street. A small percentage is wealthy, while many more live in poverty or near the margin of economic insufficiency. Indeed 48% of seniors are economically vulnerable when 200% of the New Supplemental Poverty Measure is used as the standard. Others—including many among the one out of four senior households with annual incomes in excess of $50,000—are comfortable but often only one shock away from serious financial problems (Altman & Kingson, 2015). Monthly Social Security benefits for seniors are modest, averaging just $1,328 in January 2015. Yet, two thirds of beneficiaries, 65 and over, receive at least half of their income from Social Security (U.S. Social Security Administration, 2014). While the struggle to make ends meet is a burden many seniors face, this pattern of economic stress is generally more pronounced among particular demographic groups—notably Latinos, African Americans, unmarried women, and the oldest old—who are very much at risk for living in poverty based on their limited access to resources and societal limitations that have prevented many from accumulating wealth over their lifetimes. Also, a large numbers of older workers, with health limitations and/or little opportunity to work, accept Social Security retired worker benefits at early ages (e.g., 62), thus sustaining large, permanent reductions in their monthly benefits. Social Security has helped maintain a standard of living for many families of color in America that may otherwise not be possible. People of color rely more heavily on survivor and disability benefits, reflecting lower educational attainment and higher incidence of poverty and morbidity (Martin, 2007). While non-Hispanic whites are more likely to possess wealth outside of their Social Security retirement benefits, many people of color rely solely on what they earned from Social Security for financial stability (Rockeymoore & Lui, 2011). Many people of color have also been unable to obtain wealth through their lifetimes due to past racial discrimination in American policies, yielding a disproportionate reliance on Social Security benefits to ensure that they are able to meet basic monthly expenses. While acknowledging the heterogeneity of economic circumstance among today’s old, the 2015 WHCOA provides opportunity to highlight the very real financial insecurities facing the majority of seniors today, especially those who are most vulnerable. American workers face a looming retirement income crisis, where far too many will find themselves unable to maintain their standards of living when they grow old. Allianz Life Insurance Company reported, from its 2010 survey of 3,257 people, that “an overwhelming 92%” answered that they absolutely (44%) or somewhat (48%) believe that the nation faces a retirement income crisis, with “more than half (54%)” of persons ages 44–49 saying they are “totally unprepared” for retirement (Allianz Life Insurance Company, 2010). In their 2013 retirement confidence survey, the Employee Benefit Research Institute found that only “13 percent are very confident they will have enough money to live comfortably in retirement,” the lowest ever reported in the 23 years of conducting this annual survey. This lack of confidence is not surprising as the past 35 years have not been good to most American workers. Only the top 10% of the income distribution have seen aggregate gains in household income (Picketty, 2014). From 1979 until the eve of the Great Recession in 2007, almost two fifths of all gains in household income were received by the top 1% (Hacker & Pierson, 2010), while men in the bottom 60% saw their real wages decline (Economic Policy Institute, 2012). Further, traditional private sector defined benefits are rapidly disappearing, public sector plans under political attack, and 401K and related retirement vehicles primarily benefit the well-off. And changes enacted in the 1983 (e.g., raising retirement ages, taxing benefits) have reduced benefits by roughly 24% for persons born after 1959 (Altman & Kingson, 2015). The economic crash furthered the deterioration of retirement prospects for countless individuals. Since 2008, many people in their 40s and 50s have been balancing substantial losses of 401(k), IRA and other savings, pension protection, housing equity, and job security with the rising cost of health care and college tuitions. The median income of households headed by persons 55–64 dropped from $61,700 in 2009 to $58,626 in 2012 (Kingson, 2013). Post-crash in 2013—after the stock market increased and housing prices improved—52% of households were on a glide path to an inadequate retirement income (Munnell, Hou, & Webb, 2014), presumably as much as two thirds more if health and long-term-care costs were included in this risk assessment (Altman & Kingson, 2015). According to the Pension Rights Center there is a $6.6 trillion deficit between what Americans have saved for retirement and what they should have saved in order to maintain their current standard of living. According to the National Institute on Retirement Security 38.3 million working-age households (45%) do not have any retirement account assets (National Institute on Retirement Security, 2013). Even among working households with retirement savings, “Four out of five working households have … less than one times their annual income” (National Institute on Retirement Security, 2013, 11). Thus, the WHCOA has an important opportunity to sound the alarm on the retirement income crisis. … the WHCOA has an important opportunity to sound the alarm on the retirement income crisis. Responding to the looming retirement income crisis of today’s workforce and tenuous economic circumstances of many among today’s retirees, legislative proposals are being advanced which increase Social Security’s modest, though vital, protections while simultaneously strengthening program financing. These proposals include revenue measures such as lifting the payroll contribution ceiling, gradually increasing the contribution rate over 20 years, and diversifying trust fund investments. With respect to today’s and tomorrow’s retirees, on the benefit side, they include such proposals as modest across the board increase in benefits, larger minimum benefit payments for low wage-workers, caregiver credits, and use of the Consumer Price Index for the Elderly (CPI-E) to calculate COLAs. A poll by the National Academy of Social Insurance (NASI) indicates that our Social Security system is supported across all political groups; self-reported Democrats, Republicans, and Tea-Partiers alike agree that Social Security benefits should be expanded because they understand the importance of the system to their families and communities (Tucker, Reno, & Bethell, 2013). Americans favor having millionaires and billionaires pay the same rate by raising the payroll contribution cap, currently set at $118,500 for 2015 (U.S. Social Security Administration, 2015). Of course, many disagree with the proposition that it is time to expand Social Security, but that should not stop the WHCOA from recommending that very serious consideration be given to such proposals. Whatever the outcome, the nation will benefit from a full and open debate and the WHCOA can serve as vehicle to facilitate such debate. The 2015 White House Conference on Aging has the opportunity to delve into diverse issues affecting older Americans, their families, and caregivers. As 2015 begins, we look forward to the 80th Anniversary of the Social Security Act as well as the 50th Anniversaries of Medicare and Medicaid—institutions that have reduced poverty, helped families sustain their standard of living and strengthened the national community. Addressing the retirement income crisis and significant income problems of today’s retirees in a way that recognizes the importance of intergenerational commitments and supports the expansion of the nation’s most successful and popular domestic policy will resonate most effectively with the American people. E. Kingson, Professor of Social Work at Syracuse University is Founding Co-director, Social Security Works and Co-chair of the Strengthen Social Security Coalition. M. Checksfield is Legislative Director of Social Security Works and the Strengthen Social Security Coalition. Partial support for the writing of this article was provided from a grant received by Social Security Works from The Atlantic Philanthropies.

Cinzia Di Novi, Massimiliano Piacenza, Silvana Robone, Gilberto Turati

This paper aims at investigating empirically the impact of fiscal decentralization reforms on inequality in well-being. In particular, we look at the effects on health inequalities following the assignment of larger tax power to the Italian Regions for financing their health expenditure, starting from the end of the Nineties. Exploiting large differences in the size of the tax base across Regions, we find that fiscal decentralization processes that attribute a greater tax power to lower government tiers, besides reducing inefficiencies of healthcare policies, seem to be effective in reducing also within-regional disparities in health outcomes. However, the degree of economic development � on which depends the actual fiscal autonomy from Central government � significantly affects the effectiveness of these reforms and highlights the importance to take properly into account the specific features of the context where the decentralization of power is implemented.

Carlo De Pietro, Paul Camenzind, Isabelle Sturny, Luca Crivelli · 8 authors

This analysis of the Swiss health system reviews recent developments in organization and governance, health financing, health care provision, health reforms and health system performance. The Swiss health system is highly complex, combining aspects of managed competition and corporatism (the integration of interest groups in the policy process) in a decentralized regulatory framework shaped by the influences of direct democracy. The health system performs very well with regard to a broad range of indicators. Life expectancy in Switzerland (82.8 years) is the highest in Europe after Iceland, and healthy life expectancy is several years above the European Union (EU) average. Coverage is ensured through mandatory health insurance (MHI), with subsidies for people on low incomes. The system offers a high degree of choice and direct access to all levels of care with virtually no waiting times, though managed care type insurance plans that include gatekeeping restrictions are becoming increasingly important. Public satisfaction with the system is high and quality is generally viewed to be good or very good. Reforms since the year 2000 have improved the MHI system, changed the financing of hospitals, strengthened regulations in the area of pharmaceuticals and the control of epidemics, and harmonized regulation of human resources across the country. In addition, there has been a slow (and not always linear) process towards more centralization of national health policy-making. Nevertheless, a number of challenges remain. The costs of the health care system are well above the EU average, in particular in absolute terms but also as a percentage of gross domestic product (GDP) (11.5%). MHI premiums have increased more quickly than incomes since 2003. By European standards, the share of out-of-pocket payments is exceptionally high at 26% of total health expenditure (compared to the EU average of 16%). Low and middle-income households contribute a greater share of their income to the financing of the health system than higher-income households. Flawed financial incentives exist at different levels of the health system, potentially distorting the allocation of resources to different providers. Furthermore, the system remains highly fragmented as regards both organization and planning as well as health care provision.

Marta Aguilar Gil, José María Bleda García

Spain’s Transition to Democracy set the stage for the organization of a national healthcare system. The adoption of the Spanish Constitution of 1978 was a political milestone that led to the recognition of every citizen’s right to healthcare and the right of autonomy of the different regions that make up the SpanishState. The most distinctive characteristic of the healthcare model set up in those early years of political transition was the decentralization of the healthcare system which transferred political and administrative power on matters of public health to the 17 autonomous communities. It took more than 20 years to complete this decentralization process. Due to the economic crisis and the election of a conservative government, the National Healthcare System is being seriously questioned, its very sustainability in doubt as reform measures are being taken that are considered a threat by many institutions and organizations to public welfare.

Jadwiga Suchecka

The purpose of this article is to present the main directions of changes in the Estonian health care system following the transformation of the national economy and the accession of Estonia to the European Union. Special attention has been paid to the ways of sourcing, and the collection and redistribution of financial resources allocated to health care in different periods of the transformation. The initial changes introduced far-reaching decentralization of the health system, while further reforms led to his re-centralization. The intensity of the re-centralization of finance and health management processes was accelerated after 2008, when the impact of the global financial crisis on the condition of the economy of Estonia was significant. As a result of the introduced changes, Bismarck’s mixed system – a hybrid system – has been formed.

Asri Maharani, Devi Femina, Gindo Tampubolon

In 1991, Indonesia began a process of decentralization in the health sector which had implications for the country's public hospitals. The public hospitals were given greater authority to manage their own personnel, finance and procurement, with which they were allowed to operate commercial sections in addition to offering public services. These public services are subsidized by the government, although patients still pay certain proportion of fees. The main objectives of health sector decentralization are to increase the ability of public hospitals to cover their costs and to reduce government subsidies. This study investigates the consequences of decentralization on cost recovery rate of public hospitals at district level. We examine five service units (inpatient, outpatient, operating room, laboratory and radiology) in three public hospitals. We find that after 20 years of decentralization, district hospitals still depend on government subsidies, demonstrated by the fact that the cost recovery rate of most service units is less than one. The commercial sections fail to play their role as revenue generator as they are still subsidized by the government. We also find that the bulk of costs are made up of staff salaries and incentives in all units except radiology. As this study constitutes exploratory research, further investigation is needed to find out the reasons behind these results.

Bojana Matejić, Jasmina Tanasić, Vesna Bjegović-Mikanović, T Bajić · 6 authors

Issue Serbia started the process of decentralization soon after the first phases of reforms were completed, as the integral part of the European integration process. The Law on Health Care has enabled decentralization in the primary health care sector, in order to strength the democratic governance and to improve administrative and service delivery effectiveness. Through the project with the Norwegian Association of Local and Regional Authorities (KS), the Serbian Standing Conference of Towns and Municipalities in cooperation with public health experts, assisted capacity building of local authorities. The aim of establishing Decentralized Service Improvement Networks is to advance the role of local authorities in public health and primary health care institutions, and to foster horizontal coordination between other social policy areas. Description of the problem Local governments were not aware of opportunities they have as founders of primary health care institutions- to monitor the effects of the undertaken measures in the field of financing, preventive actions and public health protection. Results DSIN for primary health care was established for the six chosen municipalities, comprising of at least 3 representatives of each local government. The cycle of 6 meetings started with a managerial meeting (mayor, heads of the services) in order to agree on a coordinated approach in the municipality and pointing out the challenges for such approach, applying SWOT analysis. DSIN have improved access to relevant statistical and administrative data, set the list of indicators to be monitored at the local level, developed and piloted the methodology for periodical survey of users satisfaction with primary health care and actively analysed and shared experiences (local and international). Furthermore, this network sucessfuly cooperated with the relevant institutions from education, social protection, NGOs, and users of services. Based on the review of all collected relevant data, every municipality have chosen to improve one priority public health service. Lesson The practice of DSIN is based on critical analysis of own performance in the context of performance of other similar institutions, on the basis of opinions of clients of the service and with wide utilization of best practices tested already in other local governments. Key messages Professional network at the local level motivates municipal authorities to perform better, to adopt innovative approaches and to learn from other experiences and good practices. The network enables local governments to learn from each other and to discuss and agree how to best use emerging good and European practice to improve the target services in their municipalities.

Mohammad Kurniawan, Deni Harbianto, Digna Niken Purwaningrum, Tiara Marthias

Despite Indonesia’s health status improvement over the last decade, special efforts to achieve the MDGs goals are still warranted, especially in maternal, neonatal, and child health (MNCH). However, the current centrally driven MNCH policies do not address the geographical disparities and the different constraints faced by Indonesian provinces and districts. Moreover, the MNCH slow progress may have been hindered by various funding constraints, for example small local budget allocation specifically for MNCH, lack of evidence-based budget planning leading to unsound health planning and implementation. Therefore, this study aims to assess the current health financing mechanism used in one of Indonesian Province of Papua, that has low MNCH outcome. This was an observational study using mixed-methods. Study subjects were from the Provincial and four selected District Health Offices in Papua Province of Indonesia. overnment official documents analysis and direct observations on the study subjects were done to assess the financing and budgeting for MNCH in Papua. The study shows a low commitment from the local government in MNCH priority areas. The main reason was that the largest share of MNCH funding still comes from Central Government (ABPN), whereas the proportion funded from local sources is relativity low. Furthermore, there is a very limited use of evidence-based financing and budgeting, mainly due to limited capability of the human resources for health as well as the largely undocumented epidemiological and health system data. This limited human resource capability also largely affected by the low commitment of the local government. Despite the relatively large amount of MNCH funding in Papua, human resource limitation poses a serious problem in scaling up for priority interventions. Low local government commitment is still the main obstacle in health budgeting policy. These problems may also applicable to other districts of Indonesia and as unanticipated effects from ill-designed health decentralization.

Sabina Nuti, Chiara Seghieri, Milena Vainieri, Silvia Zett

The Italian National Health System (NHS), established in 1978, follows a model similar to the Beveridge model developed by the British NHS (Beveridge 1942; Musgrove 2000). Like the British NHS, healthcare coverage for the Italian population is provided and financed by the government through taxes. Universal coverage provides uniform healthcare access to citizens and is the characteristic usually considered the added value of a welfare system financed by tax revenues. Nonetheless, in Italy the strong policy of decentralization, which has been taking place since the early 1990s, has gradually shifted powers from the state to the 21 Italian regions. Consequently, the state now retains limited supervisory control and continues to have overall responsibility for the NHS in order to ensure uniform and essential levels of health services across the country. In this context, it has become essential, both for the ministry and for regions, to adopt a common performance evaluation system (PES). This article reports the definition, implementation, and first evidences of a pilot PES at a national level. It shows how this PES can be viewed as a strategic tool supporting the Ministry of Health (MoH) in ensuring uniform levels of care for the population and assisting regional managers to evaluate performance in benchmarking. Finally, lessons for other health systems, based on the Italian experience, are provided.

Albert Ledesma Castelltort

Western countries with strong primary care systems organize their health services around this healthcare modality, which serves as a gateway to the system and is characterized by multidisciplinary teamwork, management transferred to the teams and a broad services portfolio. The contractual relationship between professionals and the public health system is a useful tool to modulate the efficiency of services and their ability to meet the expectations of citizens and professionals. Some countries choose to contract professionals directly, either individually or through a professional organization, an option known as a self-management system. Others opt to contract public or private entities, which in turn recruit health professionals as employees. In the latter countries, the concept of management decentralization and managerial autonomy has arisen. In Spain, only Catalonia has enabled professional entities to be hired to provide public health services, through commercial formulas, i.e. in a competitive market relationship. This relationship allows the use of corporate governance mechanisms that are not subject to public control through state intervention. The other forms of management promoted in Spain to avoid the controls of state intervention - foundations or associations - have been unsuccessful, except in the autonomous region of Valencia and some models in the autonomous region of Madrid.

Martínez Giralt, Xavier, Barros, Pedro Pita

Under traditional health insurance arrangements, citizens were covered by some insurance scheme.When sick, insurance arrangements allowed citizens to go to a health care provider, pay the price of the care received and be reimbursed later.Alternatively, the care provider would be owned by the insurer (like in integrated national health systems) and the patient paid nothing at the moment of consumption.In such arrangements, providers would freely set their prices or have no price to set at all (in an NHS-like system).Recent developments in health care financing include independent institutions that negotiate the prices with the financing institution.This is true with respect to health maintenance organizations (HMOs), managed care in general, but also in national health systems where decentralization and the split between provision and financing is implemented.In this scenario, negotiation over contractual terms, including prices as one major element, becomes a relevant issue in the analysis of performance of health care systems.Both empirical and theoretical analyses have been produced, and are reviewed below.This chapter reflects our views and preferences.It does not aim to be an encyclopaedic view of the existing literature on bargaining in health care.Instead, we try to highlight the new developments associated with explicit bargaining between third-party payers and providers of health care (a relation which is, in itself, only one of many that exist in the health care sector).Bargaining theory has a long tradition in the economics literature.However, it is only recently that this approach has found space in the analysis of the health care sector.The recognition of the strategic interaction among agents in the health care sector (patients, providers and third-party payers) came with the application of models borrowed from the industrial organization tradition dating from the 1970s.It was in the early 1990s when a step forward was taken with the eruption of the models of bargaining (see for example, Osborne and Rubinstein, 1990, for a nice presentation) In many situations the health care sector has the structure of a bilateral monopoly/oligopoly.In this context, bargaining becomes the natural way to approach the interactions among agents.Most economic analyses of contract design in health care in fact assume that the party that moves first, typically the payer, proposes a take-it-or-leave-it offer to the provider.We take here a broader view, looking at other types of negotiation procedures.We do not discuss issues related to contract design, which are taken up in chapter 22 by Chalkley in this Companion.We focus here on models of explicit bargaining between two parties, which we call the payer and the provider.On theoretical grounds, simple bargaining models can have their results transposed in a straightforward way: higher bargaining power and higher M2835-JONES9781849802673PRINT.

Hans Okkels Birk, Karsten Vrangbæk, Andreas Rudkjøbing, Allan Krasnik · 7 authors

Denmark has a tradition of a decentralized health system. However, during recent years, reforms and policy initiatives have gradually centralized the health system in different ways. The structural reform of 2007 merged the old counties into fewer bigger regions, and the old municipalities likewise. The hospital structure is undergoing similar reforms, with fewer, bigger and more specialized hospitals. Furthermore, a more centralized approach to planning and regulation has been taking place over recent years. This is evident in the new national planning of medical specialties as well as the establishment of a nationwide accreditation system, the Danish Healthcare Quality Programme, which sets national standards for health system providers in Denmark. Efforts have also been made to ensure coherent patient pathways - at the moment for cancer and heart disease - that are similar nationwide. These efforts also aim at improving intersectoral cooperation. Financially, recent years have seen the introduction of a higher degree of activity-based financing in the public health sector, combined with the traditional global budgeting.A number of challenges remain in the Danish health care system. The consequences of the recent reforms and centralization initiatives are yet to be fully evaluated. Before this happens, a full overview of what future reforms should target is not possible. Denmark continues to lag behind the other Nordic countries in regards to some health indicators, such as life expectancy. A number of risk factors may be the cause of this: alcohol intake and obesity continue to be problems, whereas smoking habits are improving. The level of socioeconomic inequalities in health also continues to be a challenge. The organization of the Danish health care system will have to take a number of challenges into account in the future. These include changes in disease patterns, with an ageing population with chronic and long-term diseases; ensuring sufficient staffing; and deciding how to improve public health initiatives that target prevention of diseases and favour health improvements.

Bulgariu Catalin

2010 represented the moment when the reform was applied in the health field by decentralizing the management ofthe health units with beds (hospitals). This analysis points out the way hospital financing was carried out after that and the main problems the health care system of Romania has to deal with. In the end there are presented a few personal considerations on the main challenges for the future.

Jan Klavus, Ilkka Vohlonen, Juha Kinnunen, Veli Koistinen · 5 authors

The Finnish health care system is financed in a highly decentralized manner. In the tax-financed Beveridge model each municipality is responseble for financing and organizing health care services for its residents. This paper examined the annual incidence and treatment costs of three cost-intensive DRG-groups, and all DRG-groups together. The objective was to estimate municipal level predictions on the incidence of new illness cases and their associated costs, and to analyze whether there was greater uncertainty in anticipated specialized health care costs in municipalities with smaller populations. The dataset comprised of longitudinal hospital utilization and discharge data from Hospital Discharge Registers. The expected annual variation of illness cases and costs was assessed with respect to 95% confidence intervals estimated for each morbidity group and municipality. The results indicated that the costs of the selected morbidity groups fluctuated in a completely uncontrollable manner in municipalities with small populations. As the median size of Finnish municipalities is less than 6000, the inability to anticipate periodic health care costs constitutes an extensive financial problem and calls for the establishment of larger regional units and funding pools.

José Jesús Martín Martín, María del Puerto López del Amo González

The Spanish National Health System (SNHS) has sustainability problems resulting from weaknesses in institutional design and governance compounded by the economic crisis it faces. The global economic crisis has had a particularly virulent impact in Spain, characterized by high levels of unemployment and public and private debt. Fiscal adjustment policies implemented may significantly compromise the SNHS. Along with general funding problems, the strong territorial decentralization of health jurisdictions in the Autonomous Communities has not been backed up by efficient State-level health coordination. The SNHS suffers from problems in its rules of governance, its autonomous financing system, human resource policies and diversity of direct and indirect management models in different Autonomous Communities. A reform strategy in Spanish healthcare governancemust be articulated within the context of a broader review of public policies to stabilize the lines of defense of the welfare state. Within the scope of the health sector, the financing system must be improved and institutional changes to increase efficiency must be implemented.

Elena Gelormino, Clare Bambra, Teresa Spadea, Silvia Bellini · 5 authors

Health care is widely considered to be an important determinant of health. The health care systems of Western Europe have recently experienced significant reforms, under pressure from economic globalization. Similarly, in Eastern Europe, health care reforms have been undertaken in response to the demands of the new market economy. Both of these changes may influence equality in health outcomes. This article aims to identify the mechanisms through which health care may affect inequalities. The authors conducted a literature review of the effects on health inequalities of European health care reforms. Particular reference was paid to interventions in the fields of financing and pooling, allocation, purchasing, and provision of services. The majority of studies were from Western Europe, and the outcomes most often examined were access to services or income distribution. Overall, the quality of research was poor, confirming the need to develop an appropriate impact assessment methodology. Few studies were related to pooling, allocation, or purchasing. For financing and purchasing, the studies showed that publicly funded universal health care reduces the impact of ill health on income distribution, while insurance systems can increase inequalities in access to care. Out-of-pocket payments increase inequalities in access to care and contribute to impoverishment. Decentralizing health services can lead to geographic inequalities in health care access. Nationalized, publicly funded health care systems are most effective at reducing inequalities in access and reducing the effects on health of income distribution.

T. J. Bossert

There is an avalanche of interest in health systems with countries, donors, international experts and academic institutions all rushing to promote, fund or build capacity to address this wave of interest. As Anne Mills documents in an article in this volume, there is also a growing literature on how to think about health systems, how to use research on health systems to improve their performance, and pleas for greater investment in knowledge about health systems. We are probably riding on the crest of this new wave and it will be important to make use of it to further our knowledge about how to achieve health system effectiveness. With continuing global economic uncertainty, this wave may pass if we do not take advantage of it now. It is useful to reflect on why there is such interest in this theme now. There are probably many converging causes but the most important, to my mind, is a replay of an old debate between vertical programmes and horizontal, integrated approaches that has experienced swings of interest at least since the Alma Ata Conference in 1978 emphasized the integrated primary health care approach. During the last decade or more, there has been a major focus on vertical disease-specific programmes supported by greatly increased funding from the Global Fund to Fight AIDS, Tuberculosis and Malaria, Global Alliance for Vaccines and Immunisation (GAVI), US President’s Emergency Plan for AIDS Relief (PEPFAR), Bill and Melinda Gates Foundation, among other donors. The major claim of these programmes was that by focusing on clear disease-specific objectives they would be more effective in shorter time periods and they could be held more accountable to donors (since the results could be more measurable) than the difficult and diverse efforts to improve the many elements of a health system through the horizontal integrated approach. While there were evident successes in these programmes, there was also a growing recognition that health system constraints—especially in human resources and logistics systems—were becoming major obstacles to achieving even their limited objectives of increased coverage of HIV/AIDS, tuberculosis, malaria and immunizations. With the added emphasis on the Millennium Development Goals (MDGs) and the slow progress toward their achievement in many countries, the international community and national governments have turned increasingly toward attempting to reduce the health system constraints—an approach that is closer to the integrated horizontal approach. Both GAVI and the Global Fund have added a separate fund for health systems interventions. In 2008, the G8 called for greater attention to health system strengthening as compatible with the prior focus on vertical programmes (Reich et al. 2008). In 2009, the World Bank convened a seminar on health system strengthening attended by representatives from the World Health Organization (WHO), GAVI and Global Fund. A task force on Healthy Women and Healthy Children calling for a health system funding platform was initiated at the UN General Assembly. In 2010, the WHO and others sponsored the First Global Symposium on Health Systems Research in Montreux, Switzerland. While many observers are trying to argue that the two approaches are now more compatible, at least in rhetorical terms it seems that the pendulum is shifting toward greater attention to health system strengthening. So how do we, the readers of Health Policy and Planning, take advantage of this interest? Health Policy and Planning is dedicated to the publication of high quality research that, as the name implies, improves decisions on policy and planning. This poses for us a central question: how can we do research that will improve health systems? The answer is complex for it requires attention to the kind of knowledge that is both researchable and leads to practical, implementable recommendations. The place to start is with a framework of analysis that is both analytical, in that it provides empirically based categories about health systems, and purposive, in that it is oriented toward how to improve the system. Many of the frameworks that are available provide a recognizable set of functional issues whose boundaries help focus attention on specific interactions that can be studied, such as financing, service delivery, human resources, governance (Mills et al. 2001). The WHO Building Blocks framework is a very popular approach that is guiding much of the discussion and research in health systems (WHO 2007). Another approach developed by Harvard School of Public Health faculty is oriented toward using analytical categories in a purposive manner that starts with an ethically derived vision of what we would like to achieve, and works back toward finding the reasons why we have not achieved those objectives. It then focuses our attention on what we can change using evidence on the effectiveness of changing different ‘control knobs’ or policy levers, including financing, payments, organization, regulation and persuasion (Roberts et al. 2004). There is a great deal of overlap in these models and they are compatible in many ways that can guide research toward practical recommendations for policy. A second question is about levels of analysis. Should we attempt to research whole national systems, with typologies of systems and comparisons of the achievements of the different models? We often hear this orientation used in policy arguments such as the recent arguments over whether the USA should adopt the Canadian single payer model. However, this approach suffers from methodological challenges such as the ‘small number’ problem (which limits the ability to use sophisticated quantitative analysis due to the few comparable national systems) and the many different characteristics and historical trajectories that confound the analysis. Few countries—Chile, China, Colombia, Ghana, Taiwan, Turkey and Eastern European countries—have even attempted broad multifaceted health system reforms and they have tended to develop their own reform models rather than copying others. Nevertheless, there are many country studies of health reforms that provide evidence and much can be gained by detailed evaluation of the effectiveness of these models that can inform policy choice in different contexts. An alternative means of assessing health systems is to focus on sub-systems or analysis of specific policy changes, focusing on different social health insurance approaches, pay for performance, contracting, decentralization or other reforms, and assessing their performance in terms of achieving health system objectives like the MDGs, reduction in catastrophic expenditures caused by paying for illness, or broader responsiveness and accountability to citizens. The advantage of this approach is that, if the research is well designed, the causality of the impact of the changes on health system objectives can be more clearly demonstrated, and it allows a more focused attention to policy changes that different countries can adopt in an incremental way. This approach can address both systems issues and vertical programme needs. For instance, the work that I am involved in on decentralization—looking at the relationship between choice, capacity and accountability at different levels of a health system—can be used to make policy recommendations on general health system reform as well as specific reforms of logistic systems, vertical immunization or family planning programme effectiveness (Bossert et al. 2007). The challenge in this approach is to account for the general national context factors—political, economic, social and cultural—which may influence the performance of these initiatives. What works in Chile may not work in China due to many different characteristics of the country contexts. This is a major lacuna in the current research in health systems often covered over by focusing only on the differences in average income levels, assuming for instance that health system changes in low-income countries are all relatively similar. However, governance issues, cultural and ethical differences, past histories with different health systems, all play a role in constraining the lessons learned from one country to another. The recent concern with political economy and political institutionalism may inform future work in this area (Fox and Reich, forthcoming). In addition, focus on one subsystem or one policy lever is likely to miss the interactions among different subsystems changes that synergistically influence outcomes. For instance, changes in decentralization may be enhanced by changes in social insurance programmes, or the creation of a new cadre of health workers. Focusing on one in order to evaluate its separate impact will miss the role of the combined changes on achieving objectives. However, if we are aware of these limitations, it might be possible to move collectively toward setting a research agenda in which multidisciplinary researchers assess the different subsystems in ways that inform each other. Those of us who focus on organizational issues like decentralization and human resources need to be aware of and incorporate in our studies, the work of experts in economics, ethics, politics and other behavioural sciences, as well as epidemiologists and biostatisticians who help us understand the underlying population and social processes underpinning those systems. There is also an imbalance of research on functional areas of analysis with a much greater body of knowledge on financing and payment issues than on organizational issues and governance and regulation. In recent years, there has been greater interest in governance, politics and human resources issues, but these areas are so complex that they require much greater attention and more funded research than is currently in the pipeline. This poses an additional requirement for multidisciplinary studies that address these under-researched areas to bring the level of knowledge up to that of the more economic themes. This is a huge task of course and current funders have little patience for large research projects in health systems. Indeed there is considerable pressure for evaluating the performance of programmes and projects that have been funded in a very short and unrealistic time frame. It suggests that we need to be nimble and develop cadres of multidisciplinary experts to be able to quickly do the solid research necessary but within limited funds and short time horizons to provide well-documented policy recommendations. If we do not, we are likely to have missed the opportunities of this wave of interest as funding for health systems declines due to alternative priorities, donor fatigue or general global economic restrictions. None declared.

Lorraine Frisina Doetter, Ralf Götze

The present study describes and explains the changing role of the state in the Italian healthcare system since the beginning of the 1970s, with a particular focus on developments following 1978 when the healthcare system was transformed from a social insurance system into a national health service. In order to address these changes in a systematic way, we track healthcare system development along three dimensions: regulation, financing, and service provision. With regard to regulation, we observe a relative retreat of the state due to decentralization processes and internal market mechanisms. Quantitative measures for the financing and service provision dimension also indicate a modest relative retreat of the state. Taking regional data into account, we identify a clear North-South-divide in the public/private mix of financing and service provision. Although the focus of the paper is to describe the changing role of the state in the Italian healthcare system, we also offer preliminary explanations. We seek to identify the role of exogenous shocks such as economic crises versus endogenous stressors specific to the healthcare system itself (i.e. inherent inefficiencies) on healthcare system change. Therefore, the paper aims to provide a tentative, yet dynamic account of healthcare system change that is both descriptive and explanatory.

Anna Sagan, Dimitra Panteli, W Borkowski, M Dmowski · 31 authors

Since the successful transition to a freely elected parliament and a market economy after 1989, Poland is now a stable democracy and is well represented within political and economic organizations in Europe and worldwide. The strongly centralized health system based on the Semashko model was replaced with a decentralized system of mandatory health insurance, complemented with financing from state and territorial self-government budgets. There is a clear separation of health care financing and provision: the National Health Fund (NFZ) the sole payer in the system is in charge of health care financing and contracts with public and non-public health care providers. The Ministry of Health is the key policy-maker and regulator in the system and is supported by a number of advisory bodies, some of them recently established. Health insurance contributions, borne entirely by employees, are collected by intermediary institutions and are pooled by the NFZ and distributed between the 16 regional NFZ branches. In 2009, Poland spent 7.4% of its gross domestic product (GDP) on health. Around 70% of health expenditure came from public sources and over 83.5% of this expenditure can be attributed to the (near) universal health insurance. The relatively high share of private expenditure is mostly represented by out-of-pocket (OOP) payments, mainly in the form of co-payments and informal payments. Voluntary health insurance (VHI) does not play an important role and is largely limited to medical subscription packages offered by employers. Compulsory health insurance covers 98% of the population and guarantees access to a broad range of health services. However, the limited financial resources of the NFZ mean that broad entitlements guaranteed on paper are not always available. Health care financing is overall at most proportional: while financing from health care contributions is proportional and budgetary subsidies to system funding are progressive, high OOP expenditures, particularly in areas such as pharmaceuticals, are highly regressive. The health status of the Polish population has improved substantially, with average life expectancy at birth reaching 80.2 years for women and 71.6 years for men in 2009. However, there is still a vast gap in life expectancy between Poland and the western European Union (EU) countries and between life expectancy overall and the expected number of years without illness or disability. Given its modest financial, human and material health care resources and the corresponding outcomes, the overall financial efficiency of the Polish system is satisfactory. Both allocative and technical efficiency leave room for improvement. Several measures, such as prioritizing primary care and adopting new payment mechanisms such as diagnosis-related groups (DRGs), have been introduced in recent years but need to be expanded to other areas and intensified. Additionally, numerous initiatives to enhance quality control and build the required expertise and evidence base for the system are also in place. These could improve general satisfaction with the system, which is not particularly high. Limited resources, a general aversion to cost-sharing stemming from a long experience with broad public coverage and shortages in health workforce need to be addressed before better outcomes can be achieved by the system. Increased cooperation between various bodies within the health and social care sectors would also contribute in this direction. The HiT profiles are country-based reports that provide a detailed description of a health system and of policy initiatives in progress or under development. HiTs examine different approaches to the organization, financing and delivery of health services, and the role of the main actors in health systems; they describe the institutional framework, process, content and implementation of health and health care policies; and highlight challenges and areas that require more in-depth analysis.

Uma Kelekar

The aim of this research is to better understand the effects of a decentralized health system of the Philippines on public health care expenditures by investigating determinants of local government public health spending for year 2007. Within the context of the Philippines’ decentralized health system and health externalities that arise at the individual-level and manifest at the regional level, particular emphasis is given to spatial spillovers and fiscal interactions among municipalities. The research addresses these issues in an empirical spatial econometric framework utilizing public finance local government data for the Philippines. Competition for health resources including doctors and drugs, thereby bidding up the costs of health inputs is one of the potential causes for positive fiscal spatial dependence cited in this paper. It is also anticipated that this could be an outcome of yardstick competition, where local agents strategically compete with each other by spending higher in order to be re-elected, 2007 being an election year.

Shoba Raja, Sarah Wood, Victoria de Menil, Saju C Mannarath

BACKGROUND: Limited evidence about mental health finances in low and middle-income countries is a key challenge to mental health care policy initiatives. This study aimed to map mental health finances in Ghana, Uganda, India (Kerala state), Sri Lanka and Lao PDR focusing on how much money is available for mental health, how it is spent, and how this impacts mental health services. METHODS: A researcher in each region reviewed public mental health-related budgets and interviewed key informants on government mental health financing. A total of 43 key informant interviews were conducted. Quantitative data was analyzed in an excel matrix using descriptive statistics. Key informant interviews were coded a priori against research questions. RESULTS: National ring-fenced budgets for mental health as a percentage of national health spending for 2007-08 is 1.7% in Sri Lanka, 3.7% in Ghana, 2.0% in Kerala (India) and 6.6% in Uganda. Budgets were not available in Lao PDR. The majority of ring-fenced budgets (76% to 100%) is spent on psychiatric hospitals. Mental health spending could not be tracked beyond the psychiatric hospital level due to limited information at the health centre and community levels. CONCLUSIONS: Mental health budget information should be tracked and made publically accessible. Governments can adapt WHO AIMS indicators for reviewing national mental health finances. Funding allocations work more effectively through decentralization. Mental health financing should reflect new ideas emerging from community based practice in LMICs.

Mahjabeen Haji, Varatharajan Durairaj, Pascal Zurn, Laura Stormont · 5 authors

Decentralization involves the dispersion of power, functions and finances from a central authority to regional and local authorities. Decentralization reforms have become widespread in low- and middle-income countries, mainly due to movements towards democratiza-tion, the spread of multi-party electoral systems and transitions towards market economies. In particular, decentraliza-tion of financing systems, particularly for health, is now a common aspect of reform in these countries. The main advantage is the dynamism it can bring into the resource allocation mechanism; it also can facilitate re-allocation of funds through a visible, vibrant and bottom-up approach.

Thomas Stratmann, Ernesto Crivelli, Adam Leive

Government spending on health has grown as a percent of GDP over the last 40 years in industrialized countries. Widespread decentralization of healthcare systems has often accompanied this increase in spending. In this paper, we explore the effect of soft budget constraints on subnational health spending in a sample of OECD countries. We find countries where subnational governments rely primarily on central government financing and enjoy large borrowing autonomy have higher healthcare spending than those with more restrictions on subnational government borrowing.

Joseph Kutzin

Options for health financing reform are often portrayed as a choice between general taxation (known as the Beveridge model) and social health insurance (known as the Bismarck model). Ten years of health financing reform in Kyrgyzstan, since the introduction of its compulsory health insurance fund in 1997, provide an excellent example of why it is wrong to reduce health financing policy to a choice between the Beveridge and Bismarck models. Rather than fragment the system according to the insurance status of the population, as many other low- and middle-income countries have done, the Kyrgyz reforms were guided by the objective of having a single system for the entire population. Key features include the role and gradual development of the compulsory health insurance fund as the single purchaser of health-care services for the entire population using output-based payment methods, the complete restructuring of pooling arrangements from the former decentralized budgetary structure to a single national pool, and the establishment of an explicit benefit package. Central to the process was the transformation of the role of general budget revenues - the main source of public funding for health - from directly subsidizing the supply of services to subsidizing the purchase of services on behalf of the entire population by redirecting them into the health insurance fund. Through their approach to health financing policy, and pooling in particular, the Kyrgyz health reformers demonstrated that different sources of funds can be used in an explicitly complementary manner to enable the creation of a unified, universal system.