Financial alignmentNext step forward to disease management in the

Netherlands: functional pricing for chronic conditions

Evelien van der Vinne , Wageningen, The Netherlands

Abstract: This article describes financial alignment of chronical health care in

the Netherlands. The article starts with a description of the Dutch health care

system and the development of disease management. More specifically,

vertical integration, the role of the general practitioner and financial alignment

are discussed. In The Netherlands, in 2009, functional pricing; an outpatient

DRG for a chronic disease has been proposed as a new finance mechanism for

primary chronical care. This is a next step forward to stimulate disease

management in the Netherlands.

Other countries used other strategies to develop financial alignment for disease

management because they’ve different health care systems. So there’s no one-

size-fits-all solution, but general lessons, on the macro level, can be learned.

Comparison with other finance mechanisms provides insight into a countries

own system and reform plans but provides also interesting options for future

directions for other countries.

This article studies the USA and Japan, and the United Kingdom, France and

Germany on the role for general practitioners and financial alignment. This

article supports that the most promising strategies, on the macro level, for

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redesigning health care systems to a ‘disease management system’can be

found in financial alignment for providers and payers.

Introduction

ational policy makers across the world increasingly recognise that chronic conditions and diseases are one of the most important challenges that health systems face. The World Health Organisation (WHO) has identified chronic

conditions to be the leading cause of morbidity and mortality by 2020 and, if not successfully managed, they will become the most expensive problem for health care systems (Mathers and Loncar, 2005).

NAccording to the WHO definition, chronic conditions are health problems that require continuous comprehensive and complex management over a period of years or decades(WHO, 2003). Moreover, these conditions require coordinated input from a wide range of multidisciplinary health professionals. New models of providing integrated health care were being introduced in Europe and the USA in response to the fragmented health care (Congressional Budget Office (CBO), 2008). The models are as diverse as the healthcare systems are, but they share the focus on patients needs and cost reduction. After all chronic patients’ needs are the same all over the world, corresponding to the St. Vincent declaration for Diabetes, Gold for COPD etc. Most countries developed new models inspired by the concept ‘Disease Management’. According to the Disease Management Association of America (DMAA, 2008), disease management is “a system of coordinated healthcare interventions and communications for populations with conditions in which patient self-care efforts are significant.” It focuses on the management of chronically ill patients, with the goal of slowing progression of disease and avoiding costly hospitalizations and delaying complications. The key components of Disease Management are e.g. prevention of exacerbations and complications/comorbidity utilizing evidence-based practice guidelines and patient empowerment strategies, evaluation of outcomes and collaborative practice models to include physicians and support-service providers. These valuable components can be used in every country, whether they’ve a tax-based or insurance based system (Thomson et al., 2009; WHO, 2008, Boerma, 2006).The mission for the 21 century is to align care to vertical integrated chains. This vertical integration requires a more dominant role for professionals in primary care because substitution of expensive inpatient care for outpatient care and rearrangement of tasks over multi-providerdisciplins, will be organized (Starfield, 2009). The WHO (2008) encouraged all countries to orient their health care systems toward strengthened primary care. National health care systems with strong primary care infrastructures have healthier populations, fewer health-related disparities and lower overall costs for health care (Starfield et al., 2005; Kringos et al., 2010). Such reforms are only successful if they‘re enforced by the right financial incentives (Starfield et al., 2002; Gleave, 2009).In The Netherlands, minister Klink of Department Public Health, Wellness and Sports(PHWS) has proposed a new finance mechanism for outpatient, primary

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chronical care i.e. functional pricing; outpatient DRG’s for chronic diseases. This is a next step forward to disease management in the Netherlands.Other countries used other strategies because they’ve different health care systems. Comparison with other (vertical/primary care)systems and (finance)mechanisms provides insight into a countries own system and reform plans but provides also interesting options for future directions for other countries.Chapter 1 describes The Dutch health care system with the development of disease management, vertical integration, role for general practitioners and functional pricing.Chapter 2 describes the lessons from the east and west; the USA and Japan by the sections: role for general practitioners and functional pricing. Chapter 3 gives the lessons from Europe: United Kingdom, France and Germany. The last chapter (4) summarizes the article and gives insights for future directions.

Dominant role of General Practitioners

eneral practitioners have a central position in Dutch health care, they’re the gatekeepers and referrers for medical physicians and hospitals. So patients have first to contact their GP to access other care disciplines, including

specialist medical disciplines plus nursing disciplines. Gatekeeping is a significant issue and been seen as the cornerstone of health care system as a whole, especially in chronic disease care (Saltman et al., 2006; Health Council of the Netherlands, 2004). This gatekeeper role has evolved to include prevention, coordination and continuity of care, using a populational approach in correlation with the grouping together of several health professionals. Multidisciplinary provider groups establish now in primary care as a form of vertical integration.

G

In the Netherlands, a few examples of vertical ties between insurers and GPs are known to exist. In The Hague, GPs negotiated a collective insurance policy (with a collective discount) with an insurer on behalf of their roughly 60,000 patients: 25 GPs from four different practices concluded through a foundation an agreement with insurer Agis. In addition to collective discounts, there are examples where insurers have (co-)funded GP practices. In Groningen and in Arnhem, healthcare insurer Menzis fully owns healthcare centres through a foundation. The GPs and other healthcare providers are working there as employees of Menzis. Menzis has also reached an agreement with all 27 GPs in Houten, a small Dutch city, to give up their independent practices and come to work in five medical centres starting from 2009. These centres are partly financed by Menzis. Menzis, who does not have a large market share in Houten and surroundings, offers a collective basic insurance policy with a 50 euro discount to all inhabitants of Houten who sign up. GPs accept patients from other insurers and provide treatments to them. Nevertheless, Menzis’ insurance policy becomes relatively more attractive because of collective discounts as well as some extras for policyholders (fit tests, weight programmes). This agreement resembles a deal in Tiel, where Menzis also co-finances a health centre since 2007.

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In Tiel and surroundings however, Menzis had a rather strong position, already serving many consumers, so this strategy was to bind enrolees. But no all initiatives were successful. For example, insurer Zilveren Kruis opened a healthcare centre in Maarsenbroek years ago but did not attract sufficient policyholders and had to close. The extent to which foreclosure can occur depends on the competitive situation in a local market for GP services and on the type of contracts between insurers and GPs (collective or individual).

What is functional pricing?

ayment mechanisms in healthcare sector have a strong influence on the behaviour of health providers. They give incentives to increase or decrease the number of patients (capitation), visits (salary or fee-for-service), procedures

(fee for services), referrals to hospitals etc. To foster outpatient care while inpatient care is restricted, payment mechanisms should be combined (WHO, 2008). It is the combination of financial incentives and flows, e.g. financial alignment, that will stimulate providers to deliver integrated chronical care. Therefore financial alignment is the capstone of disease management.

P

Since healthcare reform in the Netherlands(2006), all general practitioners receive a fixed amount(capitation) per registered enrolee in their practice and additional a fixed fee per ‘doctor visit’(fee for service). In 2012 experiments will be started with pay for performance where the GP sets a price for health care, by functional pricing. In most of the cases the GP, as main contractor and représentant of the multidisciplinary provider group, sets a price for the complete outpatient health care for chronic conditions and negotiate with the insurer on price and tasks. Price will be linked to healthcare tasks (what) in stead of type provider (who). This gives providers free space to reorganize and reshuffle tasks over health professionals.Those functional prices per chronic condition will be called Chain Diagnoses Treatment Combination (CDTC), comparable to ‘Diagnoses Related Groups’ (DRG), but DRG’s are for inpatient care and CDTC’s are for outpatient care.CDTC form a new additional payment mechanism to reimburse health care costs of general practitioners and other health care professionals in outpatient care, like practice assistant, nurse practitioners, dietician, physician. The provider group gets a fixed regular amount from the health insurer for each member who is served. In this case it concerns members with diabetes, heart failure , COPD and Vascular disease. The payment covers all health care directly associated with the chronic disease and based on medical guidelines and quality standards. The current payment (innovation fee for service) will be ended. The provider group is responsible for providing all the specified services as described in the agreement, even if the costs exceed the price. The extent of the price is the result of free negotiations between provider group (GP as subcontractor) and insurer and therefore fixed for all members of the same provider group. Members need to register with the GP.The goal of this new payment mechanism is to stimulate aligned chronic care by reshuffling tasks or substitution of care from inpatient to outpatient and from general practitioner to nurse practitioner.

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Acting as one contractor will stimulate clinical leadership and robust management structures. The premise is that the provider group will rearrange tasks as efficiently as possible and align them in integrated and coordinated care continuums (PHWS , 2008). At the same time the insurer is stimulated to negotiate for the best quality of care for the lowest possible price. Klinks mission is to provide most valuable care for patients, measured and demonstrated in (better) health outcomes per spended euro like Porter en Olmsted Teisberg wrote in their book ‘Redefining Health Care’. The experiment will be extended to other chronic diseases after proven success.

Patient Self-Management

General Practitioner Hospital Home care

Nursinghomes

Supplementalinsurance

AWBZ

Capitation+

FunctionalPricing

DBCBudget relatedto intensityof care

Capitation

Premium Premium + Budget related to mobidity

Disease Management Chain

Financial FlowProviders

Financial FlowPayers

Insurance system Basic Insurance

Budgetrelated to Numberinhabitans

Figure 1: Relation between disease management and financial flows.

In DM, the punch line is to align different payment systems of both providers and payers to the health care/insurance continuum (see fig. 1). The crux is to calculate an adjusted mean capitation for a Chain DRG which is linked to an (inpatient) DRG on a way that substitution of health services performs. Gatekeeping, medical criteria can be included in the CDTC, like reference to a physician by general physician if a patient has a blood sugar > x or lung function<x. So there is a close interaction between health care delivery-insurance-finance.

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Lessons from East and West

Lessons from the West: USA

The role of General practitioners

he primary-care doctor, in the USA, is a family physician(PCP), general internist or general paediatrician and works as a gatekeeper in keeping people out of emergency rooms and controlling health care costs. At Health

maintenance organisations (80 million) patients were required to gain permission from their primary care physician to access laboratory, radiology, and specialty services. Health maintenance organisations moved primary care to a central position in health care, they expected primary care physicians to do far more for their patients than before, yet they paid little more, if at all, for these additional tasks. Primary care physicians were looking more and more like the "hamsters on a treadmill"(Bodenheimer, 2003).

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Many patients have difficulty obtaining an appointment with their primary care practice.Country-Comparison study (Bindman et al., 2007) showed patient-physician time in the US is about half the average of New Zealand and one-third of Australia. The authors suggest that such a severe shortfall impacts preventive care and management of chronic conditions in the US and could explain why the US does not achieve health outcomes that correspond to its higher level of investment in health care. Another problem is the widespread frustration among physicians by increased paperwork, difficulty receiving reimbursement and burdensome government regulations. The American Academy of Family Physicians (2009) predicts that the shortage of family doctors will reach 40.000 in the next 10 years. Because of this bureaucracy the profession GP has become less attractive.

In a few US primary care practices a group of diverse physicians are working as a team. Team care often means the doctor delegates routine tasks to other team members (Bodenheimer, 2003). In some cases, each team might have one primary care physician, two non-physician clinicians (nurse practitioners or physician assistants), three nursing staff (nurses or medical assistants), and a receptionist. The team is responsible for a panel of 5000 patients. Other experiments are models where patients see their physicians in groups rather than singly. John Scott, a Kaiser-Permanente primary care physician, gave his elderly patients the option of seeing him in groups. The groups are not simply patient education sessions; they include direct patient care.

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None of the innovations being introduced into the United States works well without the formation of primary care teams (Bodenheimer, 2003). The chronic care model relies on medical assistants checking reminder systems and making sure that patients receive the chronic and preventive services they need.

Lesson: Time reduction, bureaucracy in chronical care is not the answer but delegation of tasks, creativity and teamwork provides efficiency.

Financial alignment

anaged care covers disease management programmes in a broad range of care models. The two leading models are health maintenance organizations (HMOs) and preferred provider organizations (PPOs)

(Enthoven and Tollen, 2004). HMOs are based on ‘vertical integration,’ while PPOs favor ‘virtual integration.’ Vertical integration is associated with ‘closed systems,’ where hospitals, physician groups, and insurance companies are fully interrelated and only members of the health plan can access the delivery system. HMO is an insurance product that uses pre-paid capitated payment to a physician or group of physicians (usually combined with a requirement that referral to a specialist is made by a PCP) so they are often linked with group practice or independent practitioners associations (IPAs). HMOs are often integrated systems, but can also maintain collaborative arrangements with hospitals that are ‘outside’ the system. A PPO is a ‘virtually integrated system’ with a ‘provider network’ whereby an insurance company has established a cooperative agreement with hospitals and physician groups regarding payment levels and reimbursable health care services for subscribers. Physicians and hospitals may treat patients from a number of health insurance plans with a variety of agreements.

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PPOs are another insurance product that is more likely to use negotiated fee-for-service payments with a specified network of physicians/hospitals and so have much weaker association (and control) with providers.

Managed Care Organisations(MCO) limited the financial commitment of payers by paying clinicians a periodic fee per life covered and making them share the risk of costs for excessive or expensive treatment. MCO payers may be employers, insurers, the state, or, more rarely, individual clients. The MCOs’ economic incentives are usually reinforced by a range of direct interventions. These typically include controls on clinical autonomy, controls on patient choice and a degree of vertical integration. Vertical integration may take a number of forms, varying from mergers between primary and secondary care providers to contractual arrangements where specialist or secondary care providers offer MCOs preferred partner arrangements, including discounted fees. As a result of such restriction and standardization, patients relinquish some freedom of choice.

Currently less exclusive forms of managed care such as PPOs, offering financial incentives to subscribers for choosing certain healthcare providers, dominate (Baranas and Bardey, 2006). The type of insurance in the form of managed care has significantly lower transaction prices compared to fee-for-service insurance (Bardey and Rochet, 2009; Altman et al., 2003; Sorensen, 2003; Melnick et al., 1992). PPO

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plans receive a discount per treatment between 12-13% on the procedure. HMO plans receive 18 to 23% discount compared to fee-for service (Brooks et al., 1997; Cutler and Reber, 1998). That is the profit of vertical integration. Miller and Luft (1997) conclude also that HMOs show a greater use of preventive services and the same or more physician office visits per enrolee. But HMOs also tend to enrol younger and healthier patients (Hirth et al., 2006; Newhouse, 1996). Most plans include capitated payment for patient care, bear the financial risk, and share the benefits of any reduction in use of resources (such as fewer admissions to hospital) among employees or preferred providers, who are thus encouraged to work towards the same broad mission (Wagner, 2004).

Lesson: HMO’s have stronger control on providers than PPO’s but PPO’s dominate nowadays in the USA. Both types perform in cost reductions, better health outcomes due to capitation payment and risk sharing.

Lessons from the East: Japan

The role of General Practitioner

n Japan, there is no profession “general physician” to gate keep for medical care or for hospital stays. The Japanese can go to any specialist when and as often as they like (Matsuda and Yamamoto, 2001). I

In 2007 the government announced further policy developments to clarify roles of physicians with their own practice in the health care system(MHLW 2007). The Medical Ethics Council in charge of qualification of physicians started to discuss a proposal of forming a qualification for "general physician" who are able to give consultations to patients with wide-range ill-health and to use available community resources in continuity. Physicians in community are supposed not only to provide continuous care, but also to collectively provide out-of-hour services, to make referrals to hospital and other community health services, using a whole-person approach (Committee for Health Care Delivery Organizations 2007). The committee also pointed that a systematic training is necessary to raise "general physicians". A similar idea has been developed by the Japanese Medical Association. But the idea is concerned with continuity of care rather than with the payment system. Japan’s Federation of National Health Organizations, an association of public health insurers, recommends formulation of general physicians and developing a new payment system to primary care physicians. A newly introduced payment system where physicians receive a fixed amount of money per capita every month for providing health services to out-patients with chronic conditions for whom the physician make a long-term care plan have been so far unpopular among physicians (Matsuda et al., 2007). Probably a look across the borders would affect their opinion.

Lesson: To ensure continuous care and canalize patients the profession GP is significant.

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Financial alignment

he biggest step in the Japanese system to come to financial alignment, was the introduction of a new payment system for medical care. In April 2003, Japan implemented a case-mix payment system, based on an original case

classification with 2552 groups (Diagnosis Procedure Combination: DPC), with inpatients from 82 special functioning hospitals. This system contains two parts: 1. per diem prospective payment for hospital's fee with a three-level step down according to average length of stay for each diagnosis group, which is adjusted to secure the previous year's remuneration in each hospital; 2. fee-for-service payment for doctor's fee based on national fee schedule. The payment system reduced average length of stay, but did not change inpatient expenditures and increased outpatient expenditures. The in-hospital mortality rate, although un-adjusted, did not changed, but the readmission rate increased mainly through an increase in planned, not accidental, readmissions(Ikegami et al., 2004).

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A financial alignment initiative which integrates the relation patient-doctor-insurer was introduced in 2000. The Japanese Ministry of Health, Labour and Welfare (MHLW) launched a policy known as National Health Promotion in the 21st Century(Kenko 2012). The National Chronic Disease Prevention program is one of the main DM-features. The rising costs, elderly population, chronic diseases drive the development of this large-scale program. This Chronic Disease Program focuses on lifestyle-related disease and metabolic syndrome with primary prevention (Sompo Japan Research Institute, 2008).According to the reform law(NHI Act, 2006) health insurers were required to provide annual health checkups to all beneficiaries aged 40–74 years starting in April 2008 and give ‘health guidance’ to those who are found to be at risk of ‘metabolic syndrome’ to change their unhealthy life-style or maintain good control of their diseases. Japan’s NHI Act explicitly states that insurers ‘‘shall refuse reimbursement if disease or injury are intentionally caused by the insured (article 116)’’, or ‘‘caused by grave misconduct or negligence (article 117)’’ and ‘‘may withhold reimbursement if the insured refuses to follow doctor’s directions (article 119)’’. Doctors are required to report to the insurers when they find such patients (Practicing Rules, article 10). These fine-printed disclaimers are necessary to prevent moral hazards and protect the common interest of the insured population.

Japan has an undifferentiated delivery system for inpatient hospital care and long-term care. Therefore most institutional care is provided in hospitals rather than in nursing homes. The payment mechanism reflected and reinforced the undifferentiated system. Elderly long-term patients were for a long time in the hospital, keeping expensive beds occupied for acute patients.For this reason, Long-term Care Insurance (LTCI) was introduced in April 2000 with the aim to introduce insurance for home care and new coverage for nursing home facilities and to curtail social hospitalization. Several attempts to reform the elderly

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insurance were also made (Ikegami and Campbell, 1999). So Japan is differentiating her system rather than integrating.

In April 2008, the Government implemented a new insurance scheme for the elderly aged 75 and older, named 'Health Insurance for the Old-Old'(HIOO). In terms of healthcare delivery, the act stipulates the reform of providing comprehensive assessment, home care, palliative care, and integrated care as critical areas (MHLW, 2008). The new insurance scheme mainly aims at handling the growth of health expenditure for the elderly in order to maintain affordable universal coverage of health insurance (MHLW, 2008).

Lesson: DPC is an instrument (like DRG) to stimulate efficiency in hospital care. HIOO and LTCT differentiate chronic care from acute care and segments to elderly. DM performs in primary prevention with strict disclaimers for patient, doctor and insurer.

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Lessons from Europe

Lessons from the United Kingdom

The role of General practitioner

he UK has a system for funding primary care that is unique in the EU. In 1990 the fund holding scheme was introduced. General practitioner fund holding was a form of integrated capitation, i.e. a system associated mainly

with Health Maintenance Organizations in the USA, under which the services provided by various care providers or at various levels of the healthcare system are paid for out of a single general budget. The UK’s fund holding scheme allowed general practitioners to buy hospital care for their patients.

TPrimary care trusts have some big advantages over managed care organisations in trying to improve chronic care. They have the benefit of national strategies, implementation programmes, targets, and investment in the shape of national service frameworks; financial incentives to improve care of people with chronic conditions arising from the new general practice contract and generally low patient turnover. But they also have potential disadvantages—minimal incentives to prompt constant innovation and consumer focus or to harmonise the goals of managers and clinicians. Stronger incentives will be needed to prompt more innovation. For example, financial incentives could be introduced that prompted specialists and primary care staff to work jointly to reduce the risk of inappropriate hospital admission. Another example would be to create a joint budget across primary and secondary care for people with chronic conditions, building on current experiments with multispecialty teams like in the NL (Bodenheimer et al., 2002; Green et al., 2002, Curry et al., 2008).

Lesson: Structures are important since improvements in the quality of care tend to generate (measurable) benefits only in the long-term. Health professionals and providers can only be effectively incentivised to improve chronic care, if a certain ‘continuity of care’ is ensured. Financial incentives are needed to prompt innovation.

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Financial alignment

he Primary Care Act(1997) allowed NHS trusts (acute or community) to employ the primary team directly, including the general practitioners, and allowed the merger of budgets for general medical services and hospital and

community health services. In the United Kingdom, local vertical partnerships between hospitals and community services and primary care have developed at the interface between primary and secondary care.

TWith effect from April 2004, however, the UK has introduced the New General Medical Services Contract. Under this contract, each general practice receives a basic sum based on the size and make-up of its patient list, to cover the cost of providing basic family doctor care. A practice can also qualify for additional payments if it realises certain quality standards, measured by reference to a set of indicators relating to medical treatment, practice organisation and patient-orientation. The quality rewards make a substantial part of the funding (typically 30% of a general practice’s income 2009) in addition to capitation and infrastructure payments. Performance is measured using the Quality and Outcomes Framework (QOF) especially developed to give GPs the incentive to improve their work practices The indicators of the QOF concern the clinical domain ( mainly chronic conditions), “access" Directed Enhanced Service (DES), patient experience domains and quality (clinical, organisational and satisfaction) that must be completed for each practice. Participation in the QOF is voluntary but since the standards are not very stretching, practically all practices participate and get this money in addition. However, despite the relatively undemanding targets required for payment, the QOF has led to substantial improvements in the screening for risk factors in the community by primary care(Nolte and McKee, 2008).

While some controversy exists about the impact of the programme, positive outcomes with regard to quality of care, especially chronic care, have been identified (Campbell et al., 2007).

Lesson: A separate financial incentive linked to chronical care is needed to stimulate innovation and stretching targets are needed for continuing innovation.

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Lessons from France

General practitioners - Financial alignment

rance introduced a soft gate keeping model in 2005 giving general practitioners new responsibilities in terms of better care coordination and prevention. There were no financial changes in the way doctors are paid. After

three years, the reform did not achieve what was expected. FSince the beginning of 2009, the National Health Insurance Fund offers "contracts to improve individual practice" (CAPI, Contracts d'amélioration des pratiques individuelles) to individual general practitioners working as "soft" gatekeepers (médecin traitant) in order to improve their medical practice by providing financial incentives. The contracts set common objectives to health care professionals with respect to treatment and prescription patterns to be achieved over three years. These objectives are based on the recommendations of the High Health Authority (HAS), the National Institution for Health Products (AFSAPS) and the results of international comparisons. The objectives set in the contracts are inspired by global public health objectives fixed by the parliament and currently cover three domains: prevention, prescription practices, quality of care for patients with chronic diseases(diabetes, high blood pressure).Doctors who sign the contract accept to improve the prevention rates among their patients, respect some treatment guidelines and increase generic prescription. On the side of the health insurance fund, it promises to provide the data required to monitor changes in their practice. Remuneration given to doctors will depend on their results in terms of prescription and treatment. Those who do not fully achieve the objectives set will be paid according to the progress made. The remuneration scheme is rather complex, but it is announced that the maximum amount earned could be near 6000 euro’s a year, which makes an extra month of salary for the average GP.The health insurance fund is planning to extent the contracts in the future to cover other public health priorities such as improving the rate of treatment in line with guidelines concerning moderate/severe depression and detection of osteoporosis.The payment does not replace any other payment made (fee-for-service and a small capitation payment already given to treat chronically ill patients) but adds on to it. And there is no cost for the GPs who do not achieve the objectives (France Partner Institute, 2009).

Lesson: Legal replacing financial incentives are needed to change doctor’s behaviour.

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Lessons from Germany

The role of General Practitioner

hile it is now widely accepted that a strong primary care system can help improve coordination and responsiveness in health care, primary care has till 2004 not played this role in the German system. Primary care

physicians traditionally did not have a gatekeeper function. The introduction of the so-called general practitioner programmes (Hausarztprogramme 2004) represents a new form of health care. The GP is credited with a gate-keeping function (Höhne et al., 2009). The aim of GP-centred care is to avoid expensive double check-ups and specialist consultations which are not necessary from a medical point of view. Optimisation and co-operation of people and institutions within the health care system are also intended.

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Lesson: Germany recognizes the GP with gate keeping function as an instrument for efficiency.

Financial alignment

he crucial financial incentive for DM was the Act to Reform the Risk Adjustment Scheme (2002) to address the redistribution of money among sickness funds more directly (Greß et al., 2006). The new law aimed to

improve compensation for differences in the morbidity structure, to avoid “cream skimming” among sickness funds and to give them an incentive to care for chronically ill insured people. Insured people who join DMPs were labelled “chronically ill” for the purpose of the RSC scheme, and spending is calculated separately for them. Therefore, sickness funds with a high share of DMP participants receive higher compensation from the scheme. It was hoped that this would provide a stimulus for the sickness funds to try to attract chronically ill people (instead of looking at them as “bad risks”). In January 2009, the existing compensation scheme has been expanded to include morbidity-oriented factors, to improve care for patients with chronic diseases.

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The morbi-RSA entails a major reorganization of the financial flows between sickness funds: almost half of the 168 billion euro pooled in the health fund will be redistributed according to the new morbidity-based categories. As a consequence a lot of chronic patient were pushed to a DM-program.

At the same time, the morbi-RSA is part of a wider health system reorganisation. In addition (but regulated separately), remuneration of providers has become morbidity-

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oriented as well; by means of diagnosis-related groups (DRGs) for hospitals (since 2004) and standard service volumes for physicians in the ambulatory sector. Increased morbidity-orientation grounds on the idea of structuring financial flows according to medical criteria, in order to achieve a more patient-centred and a more efficient health system (Schang, 2009).

Lesson: Structural legal financial flows (for payers) according to medical criteria provides a more patient-centric health system and the top down way ensures fast implementation

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Conclusion and future directions

n obvious point is that in Japan primary prevention is the centrally component of DM and in the other countries secondary or tertiary prevention, probably caused by the absence of general practitioners.

Obvious is that all the countries are busy to (re)form primary care and see a central place for the gate keeping general practitioner in DM. However payment mechanisms vary by countries. More and more multi-disciplinary provider groups are formed to rearrange tasks to make chronic care efficient and complete.

A

The Netherlands USA Japan United

Kingdom France Germany

DMimplemen-tation strategy

Bottom up, by projects in DM

Via HMO and PPO

Top down by law Kenko 2012

Top down by PCT’s

Bottom up by projects

Top down by lawMorbi -RSA

Healt care system

Social health insurance scheme publicly financed (50%)

Free market with private nsurersMedicare + Medicaid +SCHIP

publicly financed Employe Health Insurance (EHI) + National Health Insurance (NHI) for unemployed

National Health Service (NHS) 87 % publicly financed

Social health insurance scheme publicly financed

Social health insurance scheme publicly financed

Full coverage chronical care

Yes, universal insurance

Insurance + Medi-care/Medicaid

Yes universal insurance

Yes, NHS Yes, universal insurance

Yes, universal insurance

Payers Rsik Adjudement Scheme

Adjustment for age, sex, chroni-cally ill (DKG/FKG)

no risk adjustment scheme

no risk adjustment scheme

Riskadjustedcapitation formula for PCT’s

Capitation adjusted for age and sex.

Adjustment for chronically ill (morbi-RSA)

DeductablesChroniccaly ill

health care allowance for chronically ill

Deductables vary by insurance plans

Few co-payments but not for chronically ill

Few co-payments but not for chronically ill

Several Co-payments but not for chronically ill

Several copay-ments but limited for chronically ill

Primary care 1

Hierachical professional

Non-Hierachical

No GP; Hierachical professional

Non-Hierachical

Non-Hierachical

1 The hierarchical normative model: a health system organized around primary care and regulated by the State (Spain/Catalonia, Finland and Sweden) The hierarchical professional model: the general practitioner as cornerstone to the health system (United Kingdom, Netherlands, Australia and New Zealand) The non-hierarchical professional model: primary care organised on the initiative of health professionals (Germany, Canada) Three types of approach to primary care can be distinguished in the vast body of literature on the subject, essentially from Anglo-Saxon and Scandinavian sources. Their common point is to deliver patients with a professional response during their first contact with the health system. Primary care defined as a level of care. In this context, primary care is always presented as the base of the pyramid thus differentiating itself from secondary and tertiary care. The secondary level refers to specialist medicine in the broad sense of the term (in town or in hospital), and the tertiary level to high technology medicine (university hospitals). Primary care defined as a combination of functions and activities. This combination can be broached either from the general characteristics imputed to primary care (accessibility and first contact, continuity of care, comprehensiveness and coordination), or from the content and range of the care supplied. From a services point of view, primary care is defined as ambulatory care directly accessible to patients. With a generalist, community dimension, they are focused on individuals in their family and social context. Primary care defined as health professionals providing services. In this context, the primary care sector is sometimes difficult to analyse because it groups together several types of activity involving different types of health professional with different levels of training that are not always comparable

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modelGatekeeping

professional model no gatekeeping

no gatekeeping model Gatekeeping

professional model Gatekeeping for public services

professional model no/weak gatekeeping

Payment GP Capitation + FFS + Functional Finance

FFS FFS Capitation + P4P by QOF

FFS FFS

PhysiciansHospitals

SalariedDRG

FFS + P4P (limited)DRG

FFSDPC

SalariedP4P

FFS DRG

FFS + Salary DRG

Long term care

Exceptional Medical Expenses Act AWBZ separate compulsory universal insurance scheme

means-tested programs, which cover only people withincome and assets below a certain level.

Insurance old-oldLTC social insurance (2000)separate compulsory universal insurance scheme

NHSmeans-tested programs, which cover only people with income and assets below a certain level.

Hybrid system , based on General revenue it has steep income-related coinsurance

Yes old age provisions in long term care in separate compulsory universal insurance scheme

Table 1: International overview of financial flows

In the USA, NL DM established bottom up, while in Japan, Germany, UK DM established top down by government intervention. In the USA DM is the most developed, with a wide range of different models, specialised outcomes research and Electronic patient record.In Japan, UK, Germany and the Netherlands, guidelines are developed, tasks are rearranged in different models but all on experimental basis. There’s no sufficient outcome research to support the best way. France is the last on the DM-road, they’re busy to formulate guidelines.

In the USA different strategies are used to embed DM, like HMO and PPO. PPO’s tend to survive on road to vertical integration. In the NL several preferred providers are marked but not selectively contracted. In the UK, local vertical partnership established by the fundholding system and Primary Care Act, were the merger of budgets was allowed.So financial incentives are necessary to push DM. The case of Germany with the Risk Adjustment Scheme supports this. In the Netherlands risk adjustment is a feature of the managed competition market. Every country has a sort of DRG-system to pay hospital care and chronically ill are mostly excluded from deductibles. Physicians are paid different. Countries are wrestling to get them paid by salary.

he next step is to start with functional pricing of primary chronical care defined in CDTC and to link CDTC’s to the DRG’s by disease and to link this to the risk adjustment system for payers to spread the risks over the

whole chain.Tfrom one country to another: general practitioners, but also nursing staff, physiotherapists, paediatricians, gynaecologists.

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he last step is to examine how to adjust for the multitasking package (incl. coordination) of provider groups and to implement covariates in the budget adjustment scheme. Then a financial flowchart is born to stimulate Disease

Management. T

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