Primary Health Care Needs-Based Resource Allocation through Financing of Health Regions
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1 Primary Health Care Needs-Based Resource Allocation through Financing of Health Regions 26th PCSI Conference 17 th September 2010 A Lourenço, A Bicó, S Olim, M Reis, A Ferreira Ref::ACSS\GGV\AOE v01_ Rate of potential years life lost (/ inhab) UOFC_ACSS 22 de Junhode
2 Purchaser Perspective Consumer Perspective Affordability Care Experience Value Clinical Quality Adapted from Wallace, 2009 Clinician Perspective 3 Outline Healthcare expenditure & financing Portuguese NHS organization and funding Recent changes in PHC financing Future challenges 4 2
3 16,0 United States 11,2 France 10,7 Switzerland 10,5 Austria 10,5 Germany 10,4 Canada 10,2 Belgium 1 9,9 Netherlands 9,9 Portugal 9,8 New Zealand 1 9,7 Denmark 9,7 Greece 9,4 Sweden 9,1 Iceland 9,1 Italy 9,0 Spain 9,0 OECD 8,7 Ireland 8,7 United Kingdom 8,5 Australia 8,5 Norway 8,4 Finland 8,1 Japan 7,8 Slovak Republic 7,3 Hungary 7,2 Luxembourg 7,1 Czech Republic 7,0 Poland 6,9 Chile 6,5 Korea 6,0 Turkey 5,9 Mexico Total, Public Health expenditure & expenditure on medication (%GDP) OECD, Public & private health expenditure as a share of GDP 2008 (or latest year available) % GDP Total expenditure on health Diff Current expenditure. Source: OECD Health Data
4 Real annual growth in per capita health spending, (%) 7538 United States 5003 Norway 4627 Switzerland 4210 Luxembourg Canada 4063 Netherlands 3970 Austria 3793 Ireland 3737 Germany 3696 France 3677 Belgium Denmark 3470 Sweden 3359 Iceland 3353 Australia 3129 United Kingdom 3060 OECD 3008 Finland 2902 Spain 2870 Italy 2729 Japan 2687 Greece 2683 New Zealand Portugal 1801 Korea 1781 Czech Republic 1738 Slovak Republic 1437 Hungary 1213 Poland 999 Chile 852 Mexico 767 Turkey Public & private health expenditure per capita, US$ PPP 2008 (or latest year available) USD PPP Refers to insured population rather than resident population. 2. Current expenditure. Source: OECD Health Data Data are expressed in US dollars adjusted for purchasing power parities (PPPs), which provide a means of comparing spending between countries on a common base. PPPs are the rates of currency conversion that equalise 7 the cost of a given basket of goods and services in different countries. Annual growth in health expenditure and GDP SVK PRT ITA IRL LUX ESP NZL GBR FIN NLD OECD DNK USA CAN SWE CHL MEX BEL AUS AUT FRA JPN CHE NOR DEU ISL KOR POL GRC TUR CZE HUN Real annual growth in per capita GDP, (%) Notes: : Luxembourg and Portugal : Australia, Denmark, Greece, Japan and Turkey : Iceland
5 NHS pooling of funds Ministry of Finance Annually sets NHS budget based on historical spending and on plans presented by the Ministry of Health. Beveridgean model, financed through general taxation. Ministry of Health Receives a global budget for the NHS which is then allocated to the many institutions within the NHS (Hospitals, Regional Health Administrations - RHA and Special Programmes) Controls all capital expenditure ACSS Responsible for Financial Management, Allocation criteria & Contracting Models. Prepares for approval estimates detailing the resources needed to support planned activities (NHS budget) Proposes budget allocation to each RHA for the provision of Primary Health Care (PHC) to the population, according to geographic defined areas. Defines Hospital & LHU funding models Reform started in 1996 intended to increase the purchasing role in order to gradually achieve a payer-provider split 9 NHS Funding For 2010 the NHS s budget represents M of which approx. 50% relates to public hospitals & LHU funding, through contracts signed by RHA with public providers Financial flows NHS Budget 10% Total health expenditure in % of GDP Government Subsystems Private insurance Ministry of Health 1 ARS 2 Healthcare Centre groups Public Hospitals & LHU Growth rate Hospitals budget (EPE + SPA) / NHS Budget M ARS/PHCare 4 SPA Hospitals 51% 50% EPE H & LHU 5 Others M in hospitals 11,5% -32,5% 3,7% Population and business Citizens Private Hospitals & Services ,3% Flows of financing, payment or reimbursement 1 Health System Central Administration 2 Regional Health Administration Within NHS scope Public Business Entity; 4 Public Administration Sector; 5 Others includes autonomous services, psychiatric services, transfers to the social sector institutions, payments abroad for international conventions, protocols payments and PPP (public-private partnerships)
6 NHS health care provision organization 2010 The health service in Portugal is organized in three layers: recent developments include PHC & LTC reforms, the creation of LHU (primary and secondary healthcare integration) and Hospital Centers Primary Healthcare ACES 1 Secondary Healthcare acute beds Hospital Centres Specialized Healthcare 795 acute oncology beds Oncology Institutes 68 ACES organized in 5 Regional Health Administrations USF USF; health professionals; patients Integrated Care Provider Local Health Units: acute beds Hospitals Hospital Centers: 20 Hospitals: 26 Skilled Nursing Homes Oncology Institutes: 3 Mental Health Institutions Mental Health Institutions: MH related beds beds 1 ACES: Health Care Centers Groups 2 USF: Family Health Unit 13 Payment models development Funding Primary Health Care Structures Budget Budget + Incentives (P4P) Budget + Incentives (P4P) Health Care Centre USF Model A USF Model B Salary + EH Salary + EH Salary + Capitation + P4P + Production Health Care Professional Remuneration alourenço@acss.min-saude.pt 6
7 PHC funding model rational for change Until PHC financial resources allocation criteria: Supply-oriented Driven mainly by historical path (lack of scientific scrutiny) Limitations: planning, efficiency, sustainability and equity 2010 PHC founding: Includes "health determinants component Financial adjustment path: from regions over-funded to regions under-funded (related to respective population s health needs) Normatively driven: efficient (health promotion), sustainable, equitable 15 Regional Health Authorities funding Portugal (Mainland): 278 Municipalities 74 ACES in 5 Regions 62 ACES observed during the quantil regression agregated, in the 5 Regions 26 ACES 16 ACES 22 ACES 6 ACES 3 ACES
8 PHC financing model Regional Risk Alternatives Decision tree Allocation of the financial resources to the regions and respective ACES POLITICAL DECISION Retrospective Methods Prospective Methods. Market Forces TECHNICAL DECISION Heuristic Methods Statistical Methods Structural Methods FEASIBILITY IN THE SHORT-TERM DECISION Factorial Analysis Quantile Regression Least Squares Regression Decision Tree ACES Individual 18 PHC financing model Regional Risk Model s technical description Objective variable: COSTS (HR + AUXILIARY_EXAMS + MEDICATION) per capita Explanatory variables: Education: Proportion (%) of resident population with, at least, mandatory education (2001); Purchasing power index: Purchasing power index indicator, per capita (2007); Total dependency ratio: Relation between young + old population, and active population (2008); Gender ratio: Proportion (%) of women in total population (2008); Potential years of life lost (PYLL) per habitants (2008); Unemployment : Unemployment rate registered, in % of the population between years old (2008). Adjustment quality: Pseudo R 2 =
9 PHC financing model Regional Risk Individual Analysis (cross sectional) Dependent variable (cost) and predictor variables Per capita costs Coeff. Std. Err. t P> t [95% Conf. Interval] Total dependency ratio (%) 546,56 102,51 5,33 0,00 341,12 751,99 Education(%) -84,89 80,91-1,05 0,30-247,04 77,25 Purchasing power index -0,18 0,25-0,74 0,46-0,68 0,31 Gender ratio (%) -241,64 911,86-0,26 0, , ,76 Unemployment rate (%) 266,99 232,74 1,15 0,26-199,42 733,41 Potential years of life lost (PYLL) (%) 0,01 0,01 1,17 0,25-0,01 0,02 Constant 58,14 463,63 0,13 0,90-870,99 987, Model Primary Health Care regional funding Health Needs 50% Health Determinants Population based Utilization rates Hospital Care regional funding Total dependency ratio (%) Purchasing power index Gender ratio (%) Health Needs 50% Health Determinants Net treatments between regions ACSS_UOFC 22-Jan-2008??????????
10 Challenges for PHC financing model Individual Risk Ensure conditions for registering information of morbidity Create individual indicators of prevalence Create an aggregated observatory of those indicators Define the indicators of average cost or complexity / pannel of experts / political will Choice of algorithm and respective supplier Capitation adjusted by individual risk, using the following formula: Cost of wearer i = j Prevalence ij * Average cost j + error i, With j = j th desease and i = i th wearer 22 Individual & Population based risk Demographics Age Gender Individual risk Clinical prophile Diagnostics data (ICD10) Medication prescription data
11 Thank you
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