Paying for Health Care In Estonia: Toward - PowerPoint Presentation

1. Paying for Health Care In Estonia: Toward GreaTer Integration and Improved EfficiencyWorld Bank GroupOctober 2017

2. 125 years …conservatism with innovation

3. Core system characteristic - sophistication P H C2Capitation FFSQBSAllowancesRisk-adjusted (age and gender) Floor for some rural physicians Diagnostic fundTherapeutic fundProcedure fundPoints-based scoring system Three domains19 indicatorsTiered bonusBasic allowanceDistance allowance Overtime allowance

4. Change in reform priorities 3

5. Avoidable specialist visits by tracer4Disease sub-groupNumber of specialist visitsShare of avoidable specialist visitsDiabetes42,06419.9%Hypertension63,91767.5%

6. Reform initiatives5

7. OutlineScope and methodologyKey messagesKey entry points and reform optionsMethodsPrimary health careHospital careFunctionsEndnotes and next steps6

8. Scope of analysis: Payment methods7Capitation FFSQBSAllowancesDRGPer diemKey questions:Create incentives to:Align behavior with sector objectives Mitigate unintended consequences Angles:Design and blending within care settingsBlending across care settingsAdditional instruments:Caps Co-pays

9. Scope of analysis: Payment system functions8Classifying Counting Costing Pricing MonitoringKey questionsIncrease accuracy and consistency of informationAlign price signals with system objectivesImprove accountability for achieving results

10. Methodology9Take stock of how current system operates Assess alignment with current sector objectives and international good practicesConsider potential gains and risks of emerging innovations Propose options for improvements

11. Key messagesSystem is well developed and advanced compared to other EU countriesRoom to adjust and complement with more than a dozen entry points, each with various optionsAt this stage, no reason to consider emerging innovations 10

12. Key entry points and reform options11Primary care Hospital careSpecific objectivesPayment methodsPayment functions

13. Key entry points and reform options12↑ geographical access to PHC↑ scope of PHC services↑ quality of PHC↑PHC-led coordination of careEnhance QBS IndicatorsIntroduce incentives to join group practices + adjust payment methodsIntroduce payment for enhanced care managementSimplify incentives to practice in rural areasIntroduce dynamic FFS list approach Enhance QBSarrangementsPrimary care Specific objectivesPayment methods

14. Introduce dynamic FFS approachObjectives:Use FFS more strategically to expand scope of services while reducing inefficienciesIssues:Scope of services covered by FFS funds has been rapidly expandingDiagnostic fund – capped at 39-42% of capitationTherapeutic fund – capped at 3% for solo practices, 10% for group practicesProcedure fund – no capExpansions have focused on adding services without eliminating those that have been widely adoptedExpansions have resulted in overlaps with other payment methods (e.g. capitation, QBS)13

15. Introduce dynamic FFS approach (cont’d)Objectives:Use FFS more strategically to expand scope of services while reducing inefficienciesOption(s):Towards a dynamic approach and reduced overlaps:Review FFS lists every 3 years to “pull in” routine work under adjusted capitation paymentIntroduce new interventions with a “sunset clause”Select new interventions to strategically expand problem solving capacity Monitor delivery of services pulled under capitation through routine audits As needed, risk-adjust capitation to prevent “skimping” and “cream-skimming”14

16. Enhance QBS arrangementsObjectives:Improve compliance with good practices and gradually shift attention to health outcomesIssues:Complex, point-based scoring system lacking clarity of strong performance incentiveInconsistencies with dated or absence of national clinical guidelinesProcess without any outcome indicatorsBonus amount (1.8% of avg. revenue) low compared to other OECD countries (5-15%)Tiered bonus system diluting strength of stimulusAdd-on bonus not as strong as “withhold” or “claw-back” mechanisms15

17. Enhance QBS arrangements (cont’d)Objectives:Improve compliance with good practices and gradually shift attention to health outcomesOption(s):Transition from point-based to indicator-based scoring systemEnsure national clinical guidelines are available for all indicators and that these are updated in line with international good practiceGradually introduce outcome indicatorsRaise bonus amountDrop tiered bonus in favor of all-or-nothing rule with high threshold (e.g. 18 out of 19 indicators)Adopt “withhold” or “claw-back” mechanism16

18. Key entry points and reform options17↓ unnecessary outpatient specialist visits↓volume caps for outpatient specialist and acute inpatient careAlign DRG tariffs with clinical guidelines↓ unnecessary acute inpatient care admissions↑ efficiency of acute inpatient care episodes + day care↑ copays and introduce fees for “no shows”Move to a 100% DRG reimbursement rate Refine reimbursement rates based on service volumesHospital care Specific objectivesPayment methods

19. Objectives:Reduce incentives for provision of unnecessary acute inpatient and outpatient specialist careIssues:Reimbursement rates (FFS) - outpatient specialist careReimbursement rates (DRG, FFS, per diem) - acute inpatient care:Refine reimbursement rates based on service volumes 18Up to volume cap:For services deliveredFull tariffFor services not delivered---Beyond volume capFor services delivered 30% of tariffUp to volume cap: For services deliveredFull tariffFor services not delivered---Up to 5%: For services delivered 70% of tariff Beyond 5% of volume cap: For services delivered30% of tariff

20. Objectives:Reduce incentives for provision of unnecessary acute inpatient and outpatient specialist careOptions:Reimbursement rates (FFS) - outpatient specialist careReimbursement rates (DRG, FFS, per diem) - acute inpatient care:Refine reimbursement rates based on service volumes (cont’d) 19Up to volume cap:For services deliveredFull tariffFull tariffFor services not delivered---Reduced tariff (e.g. to cover fixed costs, OECD 20-50%)Beyond volume capFor services delivered 30% of tariffReduced tariff or cap (e.g., cap up to 15%)Up to volume cap: For services deliveredFull tariffFull tariffFor services not delivered---Reduced tariff (e.g. to cover fixed costs, OECD 20-50%)Up to 5% of volume cap:For services delivered 70% of tariff 70% of tariffBeyond 5% of volume cap: For services delivered30% of tariffReduced tariff or capOptions

21. Key entry points and reform options20↑ geographical access to PHC↑ scope of PHC services↑ quality of PHC↑PHC-led coordination of care↓ unnecessary outpatient specialist visits↓ unnecessary acute inpatient care admissions↑ efficiency of acute inpatient care episodes + day careExpand SNOMED-CT as classifying systemImprove quality assurance of counting practicesMove to patient-level costing approachStrengthen pricing signals and improve impact modeling↑ accuracy + consistency, align price signals w/objectivesEnhance monitoring (↑ accountability) ↑ accountability Specific objectivesPayment functions

22. Improve pricing negotiation and impact modelingObjectives: Strengthen price signals in line with reform objectives Issues: Prices are commonly set at cost level “Price” negotiations are part of costing process – optimal mix, quantities and prices of inputs and activitiesAnnual indexation of overheads onlyModeling limited to impact of price changes on EHIF expenditures21

23. Improve pricing negotiation and impact modeling (cont’d)Objectives: Strengthen price signals in line with reform objectives Options:Establish an annual negotiation cycle for strategic price adjustments that promotes clear understanding and ownership of pricing decisions by all stakeholdersIntroduce annual indexation of all costsCarry out impact modeling of price changes on provider revenues and behaviors (in addition to EHIF expenditures) to determine adequate price levels and phase-in schedules22

24. Classifying: Expand use of SNOMED-CTObjectives:Increase the accuracy and consistency of information on health care productsIssues:“Output” classification systems (WHO’s ICD-10 for diagnoses, national health service list and NOMESCO classification for procedures) fail to capture granular information critical for risk adjustment and quality monitoring“Input systems” such as SNOMED-CT are increasingly used for EMR without mapping to output systems23

25. Classifying: Expand use of SNOMED-CT (cont’d)Objectives:Increase the accuracy and consistency of information on health care productsOptions:Expand use of SNOMED-CT in EMR systems Introduce mapping to ICD-10 to streamline billing processes Capture information from EMR for risk adjustment, and quality monitoring and QBSSignificant other benefits from mainstreaming (e.g. development of clinical decision support systems)24

26. Endnotes and next stepsSophisticated systemMonitor intended and unintended consequences Carry out further analytical work prior to moving towards implementationKeep an eye on emerging innovations AND25

27. 26Don’t throw me out with the bathwater!