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infosantésuisse : Dossier Die europäischen Gesundheitssysteme im Vergleich

infosantésuisse Dossier

Die europäischen Gesundheitssysteme im Vergleich

Inhalt

1 « Comparaisons internationales des systèmes de santé » – PowerPoint-Dokument in Französisch (2007) 100 « Coûts des systèmes de santé » – Artikel in Französisch (2006) 106 Financing Health Care in the European Union – Studie in Englisch (2009) 330 « La Participation des patients aux dépenses de ante dans 5 pays européens » – Arbeitsdokument in Französisch (2007) 374 Health for all ? – Buch in Englisch (2008) 732 Données de l’OCDE 2009 – Daten aus verschiedenen Ländern in Deutsch, Französisch und Englisch (2009) 777 « Descriptions of health care systems : Germany and the Netherlands » – Studie in Englisch (2007) 784 « La réforme du système de santé aux Pays-Bas » – Artikel in Französisch (2007) 787 Finland – Health System Review – Buch in Englisch (2008) 982 The Finnish Health Care System – Buch in Englisch (2009) 1099 Denmark Health system Review – Buch in Englisch (2007) 1286 Norway and Health, An Introduction – Buch in Englisch (2009) 1326 Health Care in Sweden – Artikel in Englisch (2009) 1330 infosantésuisse-Dossier Schweiz und Niederlande (2009 - 2010) 1336 infosantésuisse-Artikel Die Qualität in Europa (2006) 1337 infosantésuisse-Schwerpunktthema Europa (2007) 1365 Links 1367 infosantésuisse-Schwerpunktthema Europa (2010)

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DESCRIPTIONS OF HEALTH CARE SYSTEMS: GERMANY AND THE NETHERLANDS

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The German Health Care System Reinhard Busse, M.D. M.P.H. Professor of Health Care Management Berlin University of Technology & Charité – University Medicine Berlin Who is covered? Public (“social”) health insurance (SHI) is compulsory for people earning up to around €48,000 per year, including dependents who are included in the insurance. This applies to around 75% of the population. Individuals with earnings above €48,000 per year (around 20% of the population) are currently not required to be covered. If they wish, they can remain in the publicly-financed scheme on a voluntary basis (and 75% of them do), they can purchase private health insurance, or they can theoretically be uninsured. The publicly-financed scheme covers about 88% of the population. In total, 10% of the population are covered by private health insurance, with civil servants and self-employed being the largest groups (both of which are excluded from SHI). Less than 1% of the population has no insurance coverage. From 2009, health insurance will be mandatory, depending on previous insurance and/or job status either in the social or in the private health insurance scheme.

payments were made more uniform: €5 to €10 per pack of outpatient medications (except if the price is at least 30% below the so-called reference price, i.e. the maximum reimbursable amount for drugs of equivalent effectiveness, which is the case for more than 12,000 drugs), €10 per inpatient day (up to 28 days per year), and €5 to €10 for prescribed medical aids. For dental prostheses, patients receive a lump sum which on average covers 50% of costs. In total, out-of-pocket payments accounted for 13.8% of total health expenditure in 2005. Safety Nets: Cost-sharing is generally limited to 2% of household income. For additional family members, part of the household income is excluded from this calculation. For the chronically ill, the cost-sharing limit is 1%. A directive sets out the conditions for qualifying as chronically ill; since 2008 it is also necessary to demonstrate that the person has received counselling on screening measures prior to the illness.

What is covered?

How is the health system financed?

Services: The SHI benefits package covers preventive services; inpatient and outpatient hospital care; physician services; mental health care; dental care; prescription drugs; medical aids; rehabilitation; and sick leave compensation. Since 1995, long-term care is covered by a separate insurance scheme, which is mandatory for the whole population.

Publicly-Financed Scheme (SHI): The SHI scheme is operated by over 200 competing health insurance funds (sickness funds; SFs): autonomous, not-for-profit, non-governmental bodies regulated by law. The scheme is funded by compulsory contributions based on wages up to a limit of around €43,000 per year. For 2008, the average insured employee (or pensioner) contributes almost 8% of the gross wage, while the employer (or the pension fund) adds another 7% on top of the gross wage, so the combined maximum contribution is around €540 per month. This includes dependents (non-earning spouses and children) who are covered through the primary SF member. Unemployed people contribute in proportion to their unemployment entitlements, but for long-term unemployed people with a fixed low entitlement (so-called “Hartz IV”), the government employment agency pays a fixed per capita premium. Currently, SFs are free to set their own contribution rates for

Cost-sharing: Traditionally, the SHI scheme has imposed few costsharing provisions (mainly for pharmaceuticals and dental care). However, in 2004 co-payments were introduced for visits by adults

aged 18 years and older to physicians and dentists (€10 each for the first visit per quarter or subsequent visits without referral); other co-

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all other insured. Beginning in 2009, a uniform contribution rate will be set by the government and, although SFs will continue to collect contributions, all contributions will be centrally pooled by a new national health fund, which will allocate resources to each SF based on an improved risk-adjusted capitation formula. This formula will, in addition to age and sex, take morbidity from 80 chronic and/or serious illnesses into account, i.e. SFs will receive considerably more for patients with cancer, AIDS or cystic fibrosis than for “ordinary” insured. In 2009, SFs may charge an additional nominal premium if the received resources are insufficient. In 2005, public sources of finance accounted for 77.2% of total health expenditure. Private health insurance (PHI): Private health insurance plays a substitutive role in covering the two groups excluded from SHI (civil servants, who are refunded parts of their health care costs by their employer, and the self-employed), as well as high earners who choose to opt out of the publicly-financed scheme. All pay a risk-related premium, with separate premiums paid for dependents; the risk is assessed upon entry only, though as contracts are based on life-time underwriting. Substitutive private health insurance is regulated by the government to ensure that the insured do not face massively increasing premiums by age and that they are not overburdened by premiums if their income decreases. Starting in 2009, private insurers offering substitutive cover will be required to take part in a risk adjustment scheme (separate from SHI) to be able to offer insurance for persons with ill health who could otherwise not afford a risk-related premium. PHI also plays a mixed complementary and supplementary role, adding certain minor benefits to the SHI basket, providing access to better amenities, such as single/double rooms, and covering some co-payments, especially for dental care. In 2005, PHI accounted for 9.1% of total health expenditure. How is the delivery system organised? Physicians: General practitioners have no formal gatekeeper function. However, in 2004 SFs were required to offer their members the option to enroll in a “family physician care model” which provides a bonus for complying with gatekeeping rules. Ambulatory care in all specialities is mainly delivered by physicians working in solo practices, although

polyclinic-type ambulatory care centres with employed physicians have been allowed since 2004. Physicians in the outpatient sector are paid by a mixture of fees per time period and per medical procedure. SFs annually negotiate with the regional associations of physicians to determine aggregate payments, which ensures cost control. Hospitals: Hospitals are mainly non-profit, both public (about half of all beds) and private (around one-third of all beds). The private, for-profit segment has been growing over the last years (around one-sixth of all beds), mainly through takeovers of public hospitals. Independent of ownership, hospitals are principally staffed by salaried doctors. Senior doctors may also treat privately-insured patients on a fee-for-service basis. Doctors in hospitals are typically not allowed to treat outpatients. Exceptions have been made if necessary care cannot be provided on an outpatient basis by specialists in private practice. Since 2004, hospitals may also provide certain highly specialized services on an outpatient basis. Inpatient care is paid through a system of diagnosis-related groups (DRG) per admission, currently based on around 1,100 DRG categories. The system was introduced in 2004 and is revised annually to take new technologies, changes in treatment patterns, and associated costs into account. Individuals have free choice of ambulatory care physicians and, if referred to inpatient care, of hospitals. Disease Management Programs (DMPs): Legislation in 2002 created DMPs for chronic illnesses in order to give the SFs an incentive to care for chronically ill patients. DMPs currently exist for diabetes types 1 and 2, breast cancer, coronary heart disease, asthma and chronic obstructive lung disease. DMP participants are accounted separately in the risk-adjusted reallocation mechanism between SFs, i.e. they generally receive higher per-capita allocations than for non-DMP participants. Through that mechanism, SFs with higher shares of DMP patients receive higher compensation. There are currently 14,000 regional DMPs with 3.8 million enrolled patients (as of late 2007). Government: The German government delegates regulation to the selfgoverning corporatist bodies of both the SFs and the medical providers’ associations. The most important body is the Federal Joint Committee,

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created in 2004 to increase efficacy and compliance; it replaced several sectoral committees. However, more purchasing powers are also given directly to the individual SFs, e.g. to contract providers directly, to negotiate rebates with pharmaceutical companies or to procure medical aids. What is being done to ensure quality of care? Quality of care is addressed through a range of measures: Structural quality is addressed by the requirement to have a quality management system for all providers, the obligation for continuous medical education for all physicians, and health technology assessment for drugs and procedures (for which the Institute for Quality and Efficiency, IQWiG, was founded in 2004), while hospital accreditation is voluntary. Minimum volume requirements were introduced for a number of complex procedures (e.g. transplantations), thereby requiring hospitals to provide this number in order to be reimbursed. Process and partly outcome quality is addressed through the mandatory quality reporting system for all 1800+ acute care hospitals. Under this system, more than 150 indicators are measured for 30 indications covering about one-sixth of all inpatients in Germany. Hospitals receive an individual feedback. Since 2007, around 30 indicators are made public in annual, mandatory hospital quality reports.

What is being done to improve efficiency? Besides the measures to increase quality listed above, a set of other measures addresses efficiency more directly. All drugs, both patented and generic, have been subject to reference prices since 2004, unless they can demonstrate a clear added medical benefit. From 2008, IQWiG will explicitly evaluate the cost-effectiveness of drugs, thereby adding pressure on pharmaceutical prices. As mentioned, all hospitals are reimbursed through DRGs, so hospitals are paid the same for the same type of patient. As DRGs weights are calculated based on average costs, this puts enormous pressure on less efficient hospitals. How are costs controlled? In line with placing more emphasis on quality and efficiency, the previously imposed, relatively crude, but successful cost-containment measures (especially sector-wide budgets for ambulatory physicians, hospital budgets, collective prescription caps for physicians on a regional basis) are carefully revised. The prescription cap, which complemented the reference prices for pharmaceuticals, was lifted in 2001, initially leading to an unprecedented increase in spending on pharmaceuticals by the SFs. Then, prescription caps with individual liabilities were introduced. More recently negotiated rebates between SFs and pharmaceutical manufacturers and incentives to lower prices below the reference prices are the major instruments. Hospital budgets are being phased out between 2005 and 2008, while per-case DRGs become the main instrument to reimburse inpatient care. From 2009, the fixed budgets for ambulatory care will be replaced by more flexible budgets that take population morbidity into account.

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The Dutch Health Care System Niek Klazinga Professor of Social Medicine Academic Medical Centre, University of Amsterdam Who is covered? Since January 1, 2006, all residents or those paying income tax in the Netherlands are required to purchase health insurance coverage 1 . Coverage is statutory under the Health Insurance Act (Zorgverzekeringswet; ZVW) but provided by private health insurers and regulated under private law. The uninsured proportion of the population is estimated to be 1.5%, a figure that is likely to rise further (Maarse 2007). Asylum seekers are covered by the government and several mechanisms are in place to reimburse the health care costs of illegal immigrants unable to pay for care. New legislation regarding the health care costs of illegal immigrants is being debated in parliament. Prior to 2006, people with earnings above approximately €30,000 ($43,130) per year and their dependants (around 35% of the population) were excluded from statutory coverage provided by public sickness funds and could purchase cover from private health insurers. This form of substitutive private health insurance 2 was regulated by the government to ensure older people and people in poor health had adequate access to health care and to compensate the publicly-financed health insurance scheme for covering a disproportionate amount of high risk individuals. Over time, growing dissatisfaction with the dual system of public and private coverage led to the reforms of 2006. What is covered? Services: Insurers are legally required to provide a standard benefits package covering the following: medical care, including care by general 1

The exceptions are those with conscientious objections and members of the armed forces on active service. 2 Substitutive private health insurance covers people excluded from the publicly-financed health insurance scheme.

practitioners (GPs), hospitals and midwives; hospitalisation; dental care (up to the age of 18; coverage from age 18 is confined to specialist dental care and dentures); medical aids; medicines; maternity care; ambulance and patient transport services; paramedical care (limited physiotherapy/remedial therapy, speech therapy, occupational therapy and dietary advice). Insurers may decide by whom and how this care is delivered, which gives the insured a choice of policies based on quality and costs. In addition to the standard benefits package, all citizens are covered by the statutory Exceptional Medical Expenses Act (AWBZ) scheme for a wide range of chronic and mental health care services such as home care and care in nursing homes. Most people also purchase complementary private health insurance for services not covered by the standard benefits package, although insurers are not required to accept applications for private health insurance. Cost sharing: The insured pay a flat-rate premium (set by insurers) to their private health insurer. Everyone with the same policy pays the same premium. In 2006 an insured person was eligible for a refund of €255 ($367) if they incurred no health care costs. If they incurred costs of less than €255, they would receive the difference at the end of the year. This ‘no claims bonus’ system was abolished in 2007, following a change of government, and has been replaced by a system of deductibles. Every insured person aged 18 and over must now pay the first €150 ($216) of any health care costs in a given year (with some services excluded from this general rule). Out of pocket payments as a proportion of total health expenditure are around 8% (Statistics Netherlands 2007; World Health Organization 2007). Safety nets: Children are exempt from cost sharing. The government provides ‘health care allowances’ for low income citizens if the average flat-rate premium exceeds 5% of their household income.

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How is the health system financed? Statutory health insurance: The statutory health insurance system (ZVW) is financed by a mixture of income-related contributions and premiums paid by the insured. The income-related contribution is set at 6.5% of the first €30,000 ($43,130) of annual taxable income. Employers must reimburse their employees for this contribution and employees must pay tax on this reimbursement. For those who do not have an employer and do not receive unemployment benefits, the income-related contribution is 4.4%. The contribution of self-employed people is individually assessed by the Tax Department. Contributions are collected centrally and distributed among insurers based on a riskadjusted capitation formula. In 2006 the average annual premium was €1,050 ($1513). The government pays for the premiums of children up to the age of 18. In 2005 public sources of finance accounted for 65.7% of total health expenditure (World Health Organization 2007). In 2006 this proportion had risen to around 78% (Statistics Netherlands 2007). Private health insurance: Substitutive private health insurance was abolished in 2006. Most of the population purchase a mixture of complementary and supplementary private health insurance from the same health insurers who provide statutory coverage. This has given rise to concerns about the potential for risk selection, as the premiums and products of voluntary coverage are not regulated. In 2005, private health insurance accounted for 20.1% of total health expenditure (World Health Organization 2007). In 2006 this proportion had fallen to about 7% (Statistics Netherlands 2007). How is the delivery system organised? Health insurance funds: Insurers are private and governed by private law. They are permitted to have for-profit status. They must be registered with the Supervisory Board for Health Insurance (CTZ) to enable supervision of the services they provide under the Health Insurance Act and to qualify for payments from the risk equalisation fund. The insured have free choice of insurer and insurers must accept every resident in their coverage area (although most already operate nationally). A system of risk equalisation/adjustment is used to prevent direct or indirect risk selection by insurers.

Physicians: Physicians practise directly or indirectly under contracts negotiated with private health insurers. GPs receive a capitation payment for each patient on their practice list and a fee per consultation. Additional budgets can be negotiated for extra services, practice nurses, complex location etc. Experiments with pay-for-performance for quality in primary and hospital care are underway. Most specialists are hospital based. Two-thirds of hospital-based specialists are self-employed, organised in partnerships and paid on a capped fee for service basis. The remainder are salaried. Future payments will increasingly be related to activity through the Dutch version of DRGs known as Diagnosis Treatment Combinations (DTCs). Hospitals: Most hospitals are private non-profit organisations. Hospital budgets are developed using a formula that pays a fixed amount per bed, patient volume and number of licensed specialists, in addition to other factors. Additional funds are provided for capital investment, although hospitals are increasingly encouraged to obtain capital via the private market. From 2000, for several years payments to hospitals were rated according to performance on a number of accessibility indicators. Hospitals that produced fewer inpatient days than agreed with health insurers were paid less, a measure designed to reduce waiting lists. A new system of payment for specific products (DTCs) is currently being implemented. Ten percent all hospital services are now reimbursed on the basis of DTCs (up to 100% of all services in some hospitals). In the future, it is expected that most care will be reimbursed using DTCs, although there is still considerable debate about the desired speed of further liberalization of the hospital market (for example, through giving hospitals greater freedom in negotiating the price and quality of DTCs). What is being done to ensure quality of care? At the health system level, quality of care is ensured through legislation regarding professional performance, quality in health care institutions, patient rights and health technologies. A national inspectorate for health is responsible for monitoring and other activities. Most quality assurance is carried out by health care providers in close co-operation with patient and consumer organisations and insurers. Mechanisms to ensure quality in the care provided by individual professionals involve

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re-registration/re-validation for specialists based on compulsory continuous medical education; regular on site peer assessments organised by professional bodies; profession-owned clinical guidelines, indicators and peer review. The main methods used to ensure quality in institutions include accreditation and certification; compulsory and voluntary performance assessment based on indicators; and national quality improvement programmes based on the breakthrough method (Sneller Beter). Patient experiences are systematically assessed and since 2007 a national centre has been working with validated measurement instruments comparable to the CAHPS approach in the United States. The centre also generates publicly-available information for consumer choice.

decision making about reimbursement and encouraging appropriate use of health technologies. At the local level, several mechanisms are used to ensure appropriate prescribing.

What is being done to improve efficiency?

Sources

The main approach to improving efficiency in the Dutch health system rests on regulated competition between insurers combined with central steering on performance and transparency about outcomes via the use of performance indicators. This is complemented by provider payment reforms involving a general shift from a budget-oriented reimbursement system to a performance-related approach (for example, the introduction of DTCs mentioned above). In addition, various local and national programmes aim to improve health care logistics and/or initiate ‘business process re-engineering’. At a national level, health technology assessment (HTA) is used to enhance value for money by informing

Maarse, H. (2007). "Health reform - one year after implementation, available at http://www.hpm.org/survey/nl/a9/1, accessed 9 January 2008."Health Policy Monitor May.

How are costs controlled? The new Health Insurance Act aims to increase competition between private health insurers and providers to control costs and increase quality, but it is still too early to say whether these aims have been met. Increasingly, costs are expected to be controlled by the new DTC system in which hospitals must compete on price for specific services.

Statistics Netherlands (2007). World Health Organization (2007). World Health Statistics 2007. Geneva, World Health Organization.

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Thème du mois

La réforme du système de santé aux Pays-Bas Pendant de nombreuses années, l’assurance-maladie néerlandaise pour les soins de base reposait sur un système à deux piliers. Le premier était celui de la sécurité sociale destinée aux personnes à faible revenu et le second celui de l’assurance-maladie privée facultative pour les personnes à haut revenu. En 2006, le gouvernement néerlandais a instauré une réforme radicale du régime de santé en fusionnant les deux piliers pour le transformer en un système national d’assurancemaladie obligatoire aux mains d’assureurs privés. Cette réforme avait pour objectif principal d’améliorer l’efficacité du système en encourageant la concurrence sur le marché de l’assurancemaladie et des prestataires de soins.

1 Commission Dekker (1987).

Les premières propositions pour un système de santé unique au niveau national comportant des éléments de concurrence réglementés ont été formulées dès 1987 par la Commission Dekker1. Selon ce rapport, la planification centralisée au niveau de l’État devait être remplacée par un système dans lequel les assureurs en situation de concurrence achetaient des soins de façon avisée pour le compte de leurs membres. Bien qu’une vingtaine d’années se soient écoulées avant l’entrée en vigueur des réformes en 2006, de nombreux changements se sont, entre-temps, mis en place. L’introduction des primes nominales et d’un système de répartition des risques dans la sécurité sociale en sont deux exemples.

Oui à la concurrence à condition que la qualité et la solidarité soient sauvegardées L’introduction de la concurrence sur le marché de la santé n’est pas sans risque puisqu’elle peut constituer une menace pour la solidarité et la qualité. Par ailleurs, si les prestataires de soins et les assureurs acquièrent un pouvoir important sur le marché, les coûts peuvent augmenter. Afin de préserver le principe de solidarité, le gouvernement a mis en place un ensemble de prestations de base obligatoires pour tous les Néerlandais. Ceux-ci ont la liberté de choisir leur assureur-maladie, qui doit accepter tous les demandeurs pendant des périodes d’affiliation ouvertes chaque année. De plus, les assureurs doivent obligatoirement facturer la même prime nominale à chaque souscripteur (tarif uniforme). Comme on pouvait le prévoir, ces restrictions sur les primes provoquent des pertes pour les assureurs dont les affiliés génèrent des frais médicaux élevés. C’est pourquoi le gouvernement

Rudy Douven Short Term Analysis and Fiscal Affairs, Netherlands Bureau for Economic Policy Analysis (CPB), La Haye

Esther Mot Short Term Analysis, Netherlands Bureau for Economic Policy Analysis (CPB), La Haye

31 La Vie économique Revue de politique économique 3-2007

néerlandais a introduit un système de répartition des risques qui indemnise les assureurs lorsque leurs dépenses médicales présentent des différences prévisibles. Le développement du système de répartition des risques a commencé en 1991 dans la sécurité sociale et fait l’objet de constantes améliorations.

Le fonctionnement du système néerlandais de santé Le graphique 1 présente un schéma du système de financement de la santé aux Pays-Bas. À part les enfants de moins de 18 ans, tous les citoyens doivent verser au Fonds de l’assurance-maladie une contribution dépendant de leur revenu et prélevée par le fisc. Le Fonds reçoit aussi des subsides du gouvernement (par exemple pour les dépenses occasionnées par les enfants de moins de 18 ans), qui sont rétrocédés aux assureurs, après application du système de répartition des risques. Tous les consommateurs payent également une prime nominale directement à leur assureur. L’idée qui prévaut est que si les assurés ne sont pas satisfaits des prestations de leur assureur, il peuvent montrer leur désaccord en partant.

Les principales mesures contenues dans le train de réformes Le train de réformes révolutionnaire, mis en œuvre en 2006, comprend les mesures suivantes: augmentation de la prime nominale, incitations et promotion de l’efficacité, changements du côté des prestataires. Augmentation de la prime nominale

Le système financier existait déjà dans le régime de sécurité sociale d’avant les réformes, mais le montant de la prime nominale était

Marc Pomp Program Leader Market Sectors, Netherlands Bureau for Economic Policy Analysis (CPB), La Haye

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Thème du mois

Graphique 1

Financement du système de santé néerlandais

Contributions du gouvernement (– 18 ans)

Fonds de l’assurance-maladie

Contributions dépendant du revenu

Paiements aux caisses-maladie

Assurés

Assureurs

Primes (+ 18 ans)

Source: CPB/La Vie économique

euros par année. À ces avantages s’ajoute un rabais obligatoire de 255 euros par année en cas de non-recours aux soins de santé. Pour se concurrencer, les assurances-maladie peuvent aussi avoir recours aux contrats d’assurance complémentaire, aux différents niveaux de prestations et à des réseaux privilégiés de prestataires de soins. Ce dernier instrument devrait, en particulier, encourager les assureurs à négocier des contrats favorables avec les prestataires de soins. L’idée qui prévaut est de stimuler l’efficacité dans l’offre de soins puisque les assureurs vont diriger leurs membres uniquement vers des prestataires qui offrent des soins d’un bon rapport coûts/ qualité. Cela ne fonctionne bien entendu que si les informations sur la qualité des soins s’obtiennent facilement. Celles-ci manquent encore actuellement, mais le gouvernement et les compagnies privées consentent de gros efforts pour les fournir le plus vite possible. Les changements effectués du côté des prestataires

beaucoup plus bas que celui de la contribution dépendant du revenu. Dans le nouveau système, la loi exige que 50% de toutes les dépenses soient couvertes par les contributions fixées en fonction du revenu et 50% par les primes nominales. Ce dispositif a considérablement augmenté la valeur de la prime nominale des revenus les plus faibles, celle-ci pouvant passer de 350 euros en 2005 à 1050 euros en 2006. En payant une prime nominale plus élevée, les gens sont supposés prendre davantage conscience des coûts élevés de la santé. Il en a résulté une perte du pouvoir d’achat des groupes de population à bas revenu, que le gouvernement compense actuellement par des subsides mensuels versés à 5 millions de citoyens. Incitations et promotion de l’efficacité

2 Douven et Schut (2006). 3 Shut (2006).

Augmenter l’efficacité du marché de la santé n’est pas une tâche facile. Les assurancesmaladie ont besoin d’incitations, certes, mais aussi d’instruments pour produire plus efficacement. Afin de les motiver au mieux, le gouvernement néerlandais a opté pour un système d’assurance-maladie organisé sur une base privée, qui répond aux objectifs de la troisième directive concernant l’assurance non-vie de la législation sur la concurrence de la Commission européenne. Les assureurs concurrents ont obtenu divers instruments pour attirer les consommateurs. Tout en respectant les prestations de base, ils sont en concurrence sur les prix; ils sont aussi autorisés à offrir des rabais (plafonnés à hauteur de 10% d’un contrat individuel similaire) sur les primes groupées de l’assurance de base. Les assurés peuvent également opter pour une franchise volontaire qui varie entre 100 et 500

32 La Vie économique Revue de politique économique 3-2007

Bien que la libéralisation du marché des prestataires soit en retard par rapport à celle des assurances, de nombreux changements ont déjà été apportés pour promouvoir la concurrence. Les barrières juridiques se sont abaissées pour les nouveaux venus et de nombreuses cliniques indépendantes sont arrivées sur le marché ces dernières années. La mise en place d’un nouveau système de gestion hospitalière, basé sur le coût de chaque traitement, rend les négociations sur les prestations des hôpitaux plus aisées pour ceux-ci ainsi que pour les assureurs. Pour s’habituer à ces processus de négociation, les assurances et les hôpitaux peuvent, depuis 2005, négocier le volume, le prix et la qualité de 10% environ des prestations hospitalières. Les 90% restants sont encore réglementés, mais le gouvernement a l’intention de continuer à libéraliser le secteur hospitalier: on prévoit qu’à l’avenir, les hôpitaux et les assureurs négocieront 70% de leurs prestations.

Un premier bilan après une année d’expérience La guerre des prix engagée par les assureurs constitue le premier résultat marquant de la réforme. Le fait que de nombreux clients puissent changer d’assureur a fait figure de menace et a eu un impact profond sur le calcul des primes. Des primes de contrats collectifs ont, plus particulièrement, été proposées au-dessous du seuil de rentabilité. On estime que les assurances-maladie ont perdu entre 375 et 950 millions d’euros dans le financement de l’assurance de base2. Il faut dire que les réserves financières considérables de la plupart des

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Thème du mois

Encadré 1

Une marge de manœuvre encore mal utilisée dans les contrats sélectifs La preuve du succès des réformes sera l’approvisionnement efficace en services de santé. Cela pourrait être le cas si les assureurs ont recours à la nouvelle opportunité qui s’offre à eux de sélectionner leurs contractants. Ils ne semblent, toutefois, pas encore avoir saisi cette occasion jusqu’à présent. Il peut y avoir quatre raisons à cela: 1. Seuls 10% des services hospitaliers peuvent être négociés librement. De plus, les différences entre les assureurs en ce qui concerne les dépenses hospitalières ne peuvent pas s’élever à plus de 50 euros environ par payeur de prime. Cette dernière règle a été mise en place pour empêcher les assureurs de courir des risques liés aux aléas des dépenses hospitalières, pouvant survenir en raison des défauts temporaires constatés dans les nouveaux systèmes d’administration des hôpitaux. 2. L’information de qualité est insuffisante, si bien qu’une affaire avantageuse peut signifier une qualité moindre (réelle ou théorique). 3. Les assureurs n’ont pas assez de pouvoir pour négocier afin d’obtenir des contrats favorables avec les hôpitaux. Ceux-ci ne disposent pas seulement de davantage d’informations sur les coûts et la qualité de leurs services, ils peuvent aussi exercer un pouvoir sur le marché, spécialement dans les régions où ils sont en petit nombre. 4. Les assureurs éprouvent des difficultés à diriger leurs membres vers des prestataires de santé préférentiels, car les assurés qui ont conclu un contrat avec un tel réseau sont toujours autorisés, malgré des dépenses supplémentaires, à choisir un prestataire de soins en dehors de celui-ci.

Encadré 2

Références Commission Dekker, Bereidheid tot Verandering. Rapport van de Commissie Structuur en Financiering Gezondheidszorg, La Haye, 1987. Douven R. et Schut E., «Premieconcurrentie tussen zorgverzekeraars», Economisch Statistische Berichten ESB, n° 91, 2006, p. 272–275. Schut E., «Marktwerking in de zorg één jaar later», ESB-Dossier: Marktwerking, décembre 2006, 2006, p. 20–24.

compagnies d’assurance – en particulier les plus importantes – leur permettent d’assumer ces pertes. Un autre résultat inattendu fut le fait que 20% environ des Néerlandais ont changé de compagnie d’assurance. Jamais un tel taux n’avait encore été constaté. Les réformes, soutenues par une forte campagne médiatique sur les différences de primes, ont rendu la population davantage consciente de la possibilité de changer de plan de santé. De nombreux assurés sont passés d’un contrat individuel en 2005 à un contrat collectif en 2006: l’offre était vaste et les rabais nombreux autant que substantiels (en moyenne 6,5% de moins que les contrats individuels). Les assurances collectives n’étaient pas seulement destinées aux employeurs, mais proposées à des groupes qui, souvent, représentaient un nombre important d’assurés potentiels comme les grands syndicats, les fédérations nationales sportives et une grande banque coopérative. Les contrats collectifs étaient même proposés aux associations d’intérêts de personnes âgées et à plusieurs groupes de patients chroniques (par exemple diabétiques ou souffrant de polyarthrite chronique évolutive). Ces contrats ont leur raison d’être parce que les assurances-maladie compensent leurs dépenses par la répartition des risques. Ces réformes ont provoqué une série de réactions sur le marché de l’assurance-maladie. Une caisse-maladie, qui avait annoncé des pertes dans ce secteur, a commencé à réduire ses coûts administratifs ainsi que le nombre de ses collaborateurs. La sélection des risques constitue une autre alternative pour réduire les dépenses. Certains assureurs ont su exploiter les failles du système de rajustement des risques en obtenant des contrats collectifs favorables. L’assurance complémentaire est un autre instrument potentiel de sélection des risques. Les compagnies d’assurance ont, ainsi, fait part de leur intention d’accepter, en 2006 et en 2007, tous les demandeurs d’assurance complémentaire. Elles ont aussi annoncé des fusions qui, entre-temps, ont été approuvées par les autorités néerlandaises de la concurrence. Une fois ces fusions réalisées, environ 90% de la population sera assurée auprès de six grands groupes d’assurance et les 10% restants auprès de sept petites compagnies à vocation régionale3. À l’heure actuelle, il est encore trop tôt pour tirer des conclusions sur l’efficacité des réformes; elles suivent leur cours et il faudra encore rassembler davantage d’informations sur la qualité des soins. Les compagnies d’assurance et les prestataires de soins ont besoin de temps pour s’habituer à la nouvelle situation. Par ailleurs, les règles destinées à augmenter l’at-

33 La Vie économique Revue de politique économique 3-2007

trait des contrats sélectifs et de la gestion des soins («Managed Care») ne sont pas encore toutes en place.

Augmentation des dépenses de santé En ce début de millénaire, le budget global, qui génère une augmentation des listes d’attente, a été suspendu. Celles-ci ont diminué en conséquence, mais les dépenses de santé ont augmenté, ce qui a accentué le besoin de réformes. Si elles réussissent, l’augmentation de l’efficacité fera baisser la pression exercée sur les prix de la santé. Le secteur hospitalier a amélioré son efficacité en 2006: c’est ainsi que les prix libéralisés des hôpitaux ont augmenté de 1% de moins que le PIB. Le succès des réformes et l’augmentation des dépenses sanitaires peuvent aller de pair puisque cette combinaison est le signe d’une meilleure efficacité ainsi que d’une rentabilité et d’une qualité en hausse dans le système de santé. Cependant, le gouvernement devra expliquer de manière crédible l’augmentation des coûts à la population, sinon celle-ci pourrait l’interpréter comme la manifestation d’un manque d’efficacité et d’échec des réformes. 

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Health Systems in Transition Vol. 10 No. 4 2008

Finland Health system review

Lauri Vuorenkoski

Editors: Philipa Mladovsky

Elias Mossialos

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Editorial Board Editor in chief Elias Mossialos, London School of Economics and Political Science, United Kingdom and European Observatory on Health Systems and Policies Editors Reinhard Busse, Berlin Technical University, Germany Josep Figueras, European Observatory on Health Systems and Policies Martin McKee, London School of Hygiene and Tropical Medicine, United Kingdom and European Observatory on Health Systems and Policies Richard Saltman, Emory University, United States Editorial team Sara Allin, European Observatory on Health Systems and Policies Cristina Hernandez Quevedo, European Observatory on Health Systems and Policies Anna Maresso, European Observatory on Health Systems and Policies David McDaid, European Observatory on Health Systems and Policies Sherry Merkur, European Observatory on Health Systems and Policies Philipa Mladovsky, European Observatory on Health Systems and Policies Bernd Rechel, European Observatory on Health Systems and Policies Erica Richardson, European Observatory on Health Systems and Policies Sarah Thomson, European Observatory on Health Systems and Policies International advisory board Tit Albreht, Institute of Public Health, Slovenia Carlos Alvarez-Dardet Díaz, University of Alicante, Spain Rifat Atun, Imperial College London, United Kingdom Johan Calltorp, Swedish Association of Local Authorities and Regions, Sweden Armin Fidler, The World Bank Colleen Flood, University of Toronto, Canada Péter Gaál, Semmelweis University, Hungary Unto Häkkinen, Centre for Health Economics at Stakes, Finland William Hsiao, Harvard University, United States Alan Krasnik, University of Copenhagen, Denmark Joseph Kutzin, World Health Organization Regional Office for Europe Soonman Kwon, Seoul National University, Korea John Lavis, McMaster University, Canada Vivien Lin, La Trobe University, Australia Greg Marchildon, University of Regina, Canada Alan Maynard, University of York, United Kingdom Nata Menabde, World Health Organization Regional Office for Europe Ellen Nolte, London School of Hygiene and Tropical Medicine, United Kingdom Charles Normand, University of Dublin, Ireland Robin Osborn, The Commonwealth Fund, United States Dominique Polton, National Health Insurance Fund for Salaried Staff (CNAMTS), France Sophia Schlette, Health Policy Monitor, Germany Igor Sheiman, Higher School of Economics, Russia Peter C. Smith, University of York, United Kingdom Wynand P.M.M. van de Ven, Erasmus University, The Netherlands Witold Zatonski, Marie Sklodowska-Curie Memorial Cancer Centre, Poland

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Health Systems in Transition Written by Lauri Vuorenkoski, Senior Researcher, STAKES, Finland

Edited by Philipa Mladovsky and Elias Mossialos, European Observatory on Health

Systems and Policies

Finland:

Health System Review

2008

The European Observatory on Health Systems and Policies is a partnership between the World Health Organization Regional Office for Europe, the Governments of Belgium, Finland, Greece, Norway, Slovenia, Spain and Sweden, the Veneto Region of Italy, the European Investment Bank, the Open Society Institute, the World Bank, the London School of Economics and Political Science, and the London School of Hygiene & Tropical Medicine.

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Keywords: DELIVERY OF HEALTH CARE EVALUATION STUDIES FINANCING, HEALTH HEALTHCARE REFORM HEALTH SYSTEM PLANS – organization and administration FINLAND © World Health Organization 2008, on behalf of the European Observatory on Health Systems and Policies All rights reserved The European Observatory on Health Systems and Policies welcomes requests for permission to reproduce or translate its publications, in part or in full Please address requests about this to:

Publications WHO Regional Office for Europe Scherfigsvej 8 DK-2100 Copenhagen Ø, Denmark

Alternatively, complete an online request form for documentation, health information, or for permission to quote or translate, on the WHO/Europe web site at http://www euro who int/PubRequest

The views expressed by authors or editors do not necessarily represent the decisions or the stated policies of the European Observatory on Health Systems and Policies or any of its partners

The designations employed and the presentation of the material in this publication do not imply the expression of any opinion whatsoever on the part of the European Observatory on Health Systems and Policies or any of its partners concerning the legal status of any country, territory, city or area or of its authorities, or concerning the delimitation of its frontiers or boundaries Where the designation “country or area” appears in the headings of tables, it covers countries, territories, cities, or areas Dotted lines on maps represent approximate border lines for which there may not yet be full agreement

The mention of specific companies or of certain manufacturers’ products does not imply that they are endorsed or recommended by the European Observatory on Health Systems and Policies in preference to others of a similar nature that are not mentioned Errors and omissions excepted, the names of proprietary products are distinguished by initial capital letters The European Observatory on Health Systems and Policies does not warrant that the information contained in this publication is complete and correct and shall not be liable for any damages incurred as a result of its use

Printed and bound in the United Kingdom

Suggested citation: Vuorenkoski L, Mladovsky P and Mossialos E. Finland: Health system review. Health Systems in Transition. 2008; 10(4): 1–168.

ISSN 1817-6119 Vol. 10 No. 4

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Contents

Preface.............................................................................................................v Acknowledgements........................................................................................vi List of abbreviations......................................................................................ix List of tables and figures................................................................................xi Abstract....................................................................................................... xiii Executive Summary......................................................................................xv 1. Introduction...........................................................................................1 1.1 Overview of the health system.......................................................1 1.2 Geography and sociodemography..................................................4 1.3 Economic context...........................................................................6 1.4 Political context..............................................................................8 1.5 Health status..................................................................................10 2. Organizational structure......................................................................21 2.1 Historical background...................................................................21 2.2 Organizational overview...............................................................27 2.3 Decentralization and centralization..............................................36 2.4 Patient empowerment...................................................................38 3. Financing............................................................................................43 3.1 Health expenditure........................................................................45 3.2 Population coverage and basis of entitlement..............................50 3.3 Revenue collection/sources of funds............................................58 3.4 Allocation of resources and purchaser–provider relations............65 3.5. Payment mechanisms...................................................................67 4. Planning and regulation......................................................................73 4.1 Regulation.....................................................................................73 4.2 Planning and health information management.............................76 5. Physical and human resources............................................................85 iii

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6. 7. 8. 9. 10.

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5.1 Physical resources.........................................................................85 5.2 Human resources..........................................................................90 Provision of services...........................................................................97 6.1 Public health.................................................................................97 6.2 Patient pathways.........................................................................104 6.3 Primary care................................................................................105 6.4 Secondary care............................................................................109 6.5 Emergency care...........................................................................112 6.6 Pharmaceutical care....................................................................113 6.7 Rehabilitation..............................................................................117 6.8 Long-term care............................................................................117 6.9 Mental health care.......................................................................118 6.10 Dental care................................................................................120 6.11 Health care for specific populations..........................................121 Principal health care reforms............................................................123 7.1 Analysis of recent reforms..........................................................124 7.2 Future developments...................................................................137 Assessment of the health system......................................................143 8.1 Stated objectives of the health system........................................143 8.2 Distribution of the health system’s costs and benefits across the population..................................................................144 8.3 Efficiency of resource allocation in health care..........................147 8.4 Technical efficiency in the production of health care.................148 8.5 Accountability of the health care system....................................149 8.6 Contribution of the health system to health improvement...............................................................................150 Conclusions.......................................................................................153 Appendices.......................................................................................157 10.1 References.................................................................................157 10.2 Principal legislation..................................................................166 10.3 Useful web sites........................................................................167 10.4 HiT methodology and production process................................168 10.5 About the author.......................................................................170

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Preface

he Health Systems in Transition (HiT) profiles are country-based reports that provide a detailed description of a health system and of reform and policy initiatives in progress or under development in a specific country. Each profile is produced by country experts in collaboration with the Observatory’s research directors and staff. In order to facilitate comparisons between countries, the profiles are based on a template, which is revised periodically. The template provides detailed guidelines and specific questions, definitions and examples needed to compile a profile. HiT profiles seek to provide relevant information to support policy-makers and analysts in the development of health systems in Europe. They are building blocks that can be used: • to learn in detail about different approaches to the organization, financing and delivery of health services and the role of the main actors in health systems; • to describe the institutional framework, the process, content and implementation of health care reform programmes; • to highlight challenges and areas that require more in-depth analysis; • to provide a tool for the dissemination of information on health systems and the exchange of experiences of reform strategies between policy-makers and analysts in different countries. Compiling the profiles poses a number of methodological problems. In many countries, there is relatively little information available on the health system and the impact of reforms. Due to the lack of a uniform data source, quantitative data on health services are based on a number of different sources, including the

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World Health Organization (WHO) Regional Office for Europe Health for All database, national statistical offices, Eurostat, the Organisation for Economic Co-operation and Development (OECD) Health Data, the International Monetary Fund (IMF), the World Bank, and any other relevant sources considered useful by the authors. Data collection methods and definitions sometimes vary, but typically are consistent within each separate series. A standardized profile has certain disadvantages because the financing and delivery of health care differ across countries. However, it also offers advantages, because it raises similar issues and questions. The HiT profiles can be used to inform policy-makers about experiences in other countries that may be relevant to their own national situation. They can also be used to inform comparative analysis of health systems. This series is an ongoing initiative and material is updated at regular intervals. Comments and suggestions for the further development and improvement of the HiT series are most welcome and can be sent to: info@obs.euro.who.int. HiT profiles and HiT summaries are available on the Observatoryâ&#x20AC;&#x2122;s web site at www.euro.who.int/observatory. A glossary of terms used in the profiles can be found at the following web page: www.euro.who.int/observatory/glossary/ toppage.

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Acknowledgements

he Health Systems in Transition (HiT) profile on Finland was written by Lauri Vuorenkoski (National Research and Development Centre for Welfare and Health, STAKES). It was edited by Philipa Mladovsky and Elias Mossialos (European Observatory on Health Systems and Policies, London hub). This HiT draws upon an earlier edition (2002) prepared by Jutta Järvelin (STAKES). The author would like to thank the following people who have helped in preparation of the manuscript: Pertti Asplund, Jutta Järvelin, Unto Häkkinen, Ilmo Keskimäki, Jan Klavus, Heikki Laapio, Kristian Lampe, Miika Linna, Kristiina Manderbacka, Matti Rimpelä, Marja-Leena Sandelin, Marita Sihto, Juha Teperi, Hanna Toiviainen, Kristian Wahlbeck and Eeva Widström. Additionally, Vaida Bankauskaite, Simo Kokko, Mauno Konttinen, Juhani Lehto and Kimmo Leppo have reviewed the report in different stages and have significantly contributed to it. Sara Allin contributed to the editing. The current series of HiT profiles has been prepared by the research directors and staff of the European Observatory on Health Systems and Policies. The European Observatory on Health Systems and Policies is a partnership between the World Health Organization (WHO) Regional Office for Europe, the Governments of Belgium, Finland, Greece, Norway, Slovenia, Spain and Sweden, the Veneto Region of Italy, the European Investment Bank, the Open Society Institute, the World Bank, the London School of Economics and Political Science, and the London School of Hygiene & Tropical Medicine. The Observatory team working on the HiT profiles is led by Josep Figueras, Director, and Elias Mossialos, Co-director, and by Reinhard Busse, Martin vii

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McKee, Richard Saltman, heads of the research hubs. Jonathan North and Caroline White managed the production, Kathy Pond undertook the copyediting, Peter Powell typeset the material and Aki Hedigan proofread the volume. Special thanks are also due to national statistical offices that have provided data. Special thanks are extended to the WHO European Health for All database, from which data on health services were extracted; to the Organisation for Economic Co-operation and Development (OECD) for the data on health services in western Europe; and to the World Bank for the data on health expenditure in central and eastern European countries. The data used in this report are based on information available in February 2008.

viii

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List of abbreviations

AIDS BMI CIS CT DEHKO DMFT DRG EBM EEA EPR ESPAD EU EU15 EUnetHTA FCHP Finohta FIOH GDP GP HiT HIV HTA HUS ICD KELA KTL MRI MSAH NAM NAMLA NGO NHI OECD OTC PPB PPP PYLL

Acquired immunodeficiency syndrome Body mass index Commonwealth of Independent States Computed tomography National Programme for the Prevention of Type 2 Diabetes Decayed, missing or filled teeth Diagnosis-related group Evidence-based medicine European Economic Area Electronic patient record European School Survey Project on Alcohol and Other Drugs European Union EU Member States before May 2004 European network for Health Technology Assessment Finnish Centre for Health Promotion Finnish Office for Health Technology Assessment Finnish Institute of Occupational Health Gross domestic product General practitioner Health Systems in Transition Human immunodeficiency virus Health Technology Assessment Hospital district of Helsinki and Uusimaa International Classification of Diseases Social Insurance Institution, SII National Public Health Institute Magnetic resonance imaging Ministry of Social Affairs and Health National Agency of Medicines National Authority for Medico-legal Affairs Nongovernmental organization National Health Insurance Organisation for Economic Co-operation and Development Over the counter Pharmaceutical Pricing Board Purchasing power parity Potential years of life lost ix

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Rohto SII Sitra SOTKA STAKES STD TEKES TRIPS VAT WHO

Centre for Pharmacotherapy Development Social Insurance Institution (KELA) Finnish National Fund for Research and Development Municipal Database for Social and Health Statistics National Research and Development Centre for Welfare and Health Sexually transmitted disease National Technology Agency of Finland Trade-related Aspects of Intellectual Property Rights Value-added tax World Health Organization

Finland

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List of tables and figures Tables

Table 1.1 Table 1.2 Table 1.3 Table 1.4 Table 1.5 Table 1.6 Table 1.7 Table 1.8 Table 2.1 Table 3.1 Table 3.2 Table 5.1 Table 5.2 Table 5.3 Table 5.4 Table 7.1

Services funded by public sources (municipalities and NHI) in 2005 Population/demographic indicators, 1970–2005 (selected years) Macroeconomic indicators, 1996–2005 (selected years) Mortality and health indicators, 1970–2005 (selected years) Healthy life expectancy, 2002 Main causes of death (underlying cause of death, deaths per 100 000) Factors affecting health status (working age population) Dental health Milestones in the history of the Finnish health care system Trends in health care expenditure Health care expenditure by service category, (%) of total expenditure on health care, 2005 Patients in inpatient care Inpatient utilization and performance in acute hospitals in the European Union, 2006 or latest available year Items of functioning diagnostic imaging technologies Health care personnel (man years) Major health care reforms and policy measures, 1995–2007

3 6 7 11 12 13 16 17 27 44 50 86 89 90 91 124

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Figures

Fig. 1.1 Fig. 1.2 Fig. 1.3 Fig. 2.1 Fig. 3.1 Fig. 3.2 Fig. 3.3 Fig. 3.4 Fig. 3.5 Fig. 3.6 Fig. 5.1 Fig. 5.2 Fig. 5.3 Fig. 5.4 Fig. 5.5 Fig. 6.1

xii

Overview chart on health system Map of Finland Levels of immunization for measles in the WHO European Region, 2005 or latest available year (in parentheses) Organizational chart of the statutory health system Financial flow chart Total expenditure on health as a percentage of GDP in the WHO European Region, 2003 Trends in health care expenditure as a share of GDP (%) in Finland and selected other countries Health care expenditure in US$ PPP per capita in the WHO European Region, 2003 Health care expenditure from public sources as a percentage of total health care expenditure in countries in the WHO European Region, 2003 Total expenditure on health according to source of revenue, 2005 Hospital beds in acute hospitals per 1000 population in the European Union, 1990 and 2003 or latest available year (in parentheses) Beds in acute hospitals per 1000 population in Finland and selected other countries Number of physicians and nurses per 1000 population in Finland and selected other countries Number of physicians per 1000 population in Finland and selected other countries New students accepted in universities (related to health care) Outpatient contacts per person in the European Union, 2003 or latest available year (in parentheses)

2 5 19 28 44 46 47 48 49 59 87 88 93 94 95 110

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Abstract

he Health Systems in Transition (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; 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. According to various indicators, the health of the Finnish population has considerably improved over the last few decades. Average life expectancy has improved throughout the 20th century, especially during the last three decades, reaching 76 years for men and 83 years for women in 2005. Although overall mortality has fallen, the socioeconomic inequality in mortality seems to be increasing. The most significant public health problems are circulatory diseases, malignant tumours, musculoskeletal diseases, diabetes and mental health problems. In practice in Finland there are three different health care systems which receive public funding: municipal health care, private health care and occupational health care systems. The largest share of health care services is provided by the municipal health care. There are also different public financing mechanisms for health care services in Finland: municipal financing based on taxes and National Health Insurance (NHI) financing based on compulsory insurance fees. The Finnish health care system offers relatively good quality health services for reasonable cost with quite high public satisfaction. The most visible problems are long waiting times and personnel shortages in some municipalities. xiii

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The most important state level reforms from the beginning of the 1990s are: the deregulation of state steering of municipal health services and related changes in state administration; the introduction of the ‘National Project to Ensure the Future of Health Care’; the extension of public dental health care to all age groups; the introduction of the waiting time guarantee; a project to restructure municipalities and services; and the development of the national electronic patient record system. Future challenges for the decentralized Finnish health care system are: strengthening steering capacity for strategic priorities and resources; revitalizing the gradually weakening primary care system; improving cooperation between municipal primary and secondary care; improving cooperation between health care and personal social services; and addressing dual financing in publicly subsidized health care.

xiv

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Executive summary

inland is located to the north-east of the Baltic Sea. Finland became an independent republic with its own constitution in 1917, having first been under Swedish rule for 600 years and then under Russian rule for 100 years. At the start of 2007 the population of Finland was 5.3 million. The Finnish public administration system consists of three levels: state, province and municipality. The provinces are regional representatives of the central state administration. Finland is divided into five administrative provinces and the Åland Islands, the latter having autonomous status. Finland has a constitution (latest major review in 2000). Power in Finland is vested in the people, who are represented by deputies assembled in a single chamber parliament which is elected every four years. The head of state is the President of the Republic, who is elected for a period of six years by direct popular vote. In practice, the President’s power in political areas other than foreign policy is limited. The highest level of Government of the state is the Council of State (the Government) which consists of a Prime Minister and a requisite number of ministers. Judicial power is vested in independent courts of law, at the highest level in the Supreme Court and the Supreme Administrative Court. Finland is divided into 415 self-governing municipalities (in 2008) with a median number of inhabitants of 5000. Municipalities are autonomous and they are responsible for providing basic services for their residents, including primary education and social and health services. The highest decision-making body in the municipality is the municipal council which is elected by general election every four years. Municipalities levy a municipal income tax, the rate being decided independently by each municipality. Municipalities also receive xv

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some other tax revenues (real estate tax and part of the corporate tax), subsidies paid by the state and other revenues (such as user-fees). The objectives of Finnish health policy are to reduce premature deaths, to extend people’s active and healthy life, to ensure the best possible quality of life for all and to reduce differences in health. The foundation of the health services is laid down in the constitution of Finland (section 19). According to the constitution: Everyone shall be guaranteed by an act the right to basic subsistence in the event of unemployment, illness, and disability and during old age as well as at the birth of a child or the loss of a provider. The public authorities shall guarantee for everyone, as provided in more detail by an act, adequate social, health and medical services and promote the health of the population.

According to various indicators, the health of the Finns has considerably improved over the last few decades. Average life expectancy among the Finnish population has improved throughout the 20th century, and especially during the last three decades, reaching 76 years for men and 83 years for women in 2005. The most significant public health problems are currently circulatory diseases, malignant tumours, musculoskeletal diseases and mental health problems. Emerging problems are obesity, chronic lung diseases and diabetes, particularly type 2 diabetes. Total expenditure on health as a percentage of gross domestic product (GDP) in Finland was 7.5% in 2005. Health care expenditure expressed in US$ purchasing power parity (PPP) per capita was 2331, which was one of the lowest among the Organisation for Economic Co-operation and Development (OECD) countries. The Finnish health system is primarily funded through taxation (61%) and National Health Insurance (NHI). Total public sector funding as a percentage of total expenditure on health is 78%. In practice in Finland there are three different health care systems which receive public funding: municipal health care, private health care and occupational health care. There are significant differences between the systems, for example in the scope of the services provided, user-fees and waiting times. There are also different public financing mechanisms for health care services in Finland: municipal financing based on taxes and NHI financing based on compulsory insurance fees. Municipalities fund municipal health care services (except outpatient drugs and transport costs) and NHI funds for example private health care, occupational health care, outpatient drugs, transport costs, sickness allowances and maternity leave allowances. This dual public financing creates challenges for the overall efficiency of service production, particularly in pharmaceutical care where dual financing incurs cost-shifting problems. xvi

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The largest share of publicly financed health care is provided by the municipal health care system (71% of outpatient physician visits, 59% of outpatient dentists visits and 95% of inpatient care periods). According to legislation, more than 400 municipalities are responsible for providing all necessary health services for their residents. Municipalities have a significant degree of freedom to plan and steer the services as they see best, and state level steering is rather weak. Currently there are many ongoing local development projects and experiments concerning municipal services (for example increasing cooperation between municipalities, between primary and secondary care services and between municipalities and the private sector). However, they are not well coordinated from the national level, probably leading to increasing regional variance in structures. Public responsibility for health care has arguably been decentralized in Finland more than in any other European country, and in recent years, concerns have increasingly been raised that the problems of extreme decentralization outweigh the advantages. However, there are signs that the decentralization trend has slightly reversed and national level steering will increase. For example, the governmental programme for the restructuring of municipalities and services has a goal to decrease the number of municipalities and increase cooperation between municipalities. According to legislation, every municipality must have a health centre which provides primary health services. Additionally, legislation divides the country into 20 hospital districts (excluding Åland islands) which are responsible for the provision of municipal secondary care services. Each municipality must be a member of one hospital district. Hospital districts are financed and managed by the member municipalities. Often municipalities experience a lack of influence on the volume and costs of the hospital districts, despite the fact that they directly own them, and find that primary health care is in too weak a position relative to secondary health care. Legislation sets maximum user-fees and an annual ceiling for health care charges for municipal services. These user-fees cover on average 7% of municipal health care expenditure. Outpatient drugs are not covered by the municipal health care system, but by NHI instead. On average, 67% of outpatient drug costs are reimbursed to the patient. There is a (separate) ceiling for out-of-pocket payments for outpatient drugs. Both the municipal health care and outpatient drugs ceilings are high compared with other Nordic countries. In extreme situations social assistance is available (when an individual’s or a family’s income is not enough to cover the user-fees of municipal health care services or outpatient drugs). The statutory NHI scheme finances 17% of the total costs of health care. The scheme is run by the Social Insurance Institution (SII), with about 260 local offices all over the country. SII falls under the authority of the Parliament and

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covers all Finnish residents. NHI is funded by the insured (38%), employers (33%) and the state (28%). The insured pay income-based insurance fees which are collected alongside taxation. The use of private health care is partly reimbursed by NHI. It mainly comprises ambulatory care available in the larger cities. The private sector provides about 16% of outpatient visits to physicians, 41% of outpatient visits to dentists and 5% of inpatient care periods. NHI covers about one third of the actual costs of the private health services. Additional voluntary health insurance has a very marginal role in the Finnish health care system and is mainly used to supplement the reimbursement rate of NHI. Legislation on occupational health care obliges all employers to provide preventive occupational health care services for their employees. As part of compulsory preventive occupational health services, many large- or mediumsized employers also provide curative outpatient services (13% of outpatient physician visits are provided by the occupational health care system). The NHI scheme reimburses about 40% of the occupational health care expenses for the employer. Occupational health care services are free of charge for employees. The majority of physicians work for municipalities and hospital districts. Physicians in health centres and hospital districts are usually salaried employees of the municipalities. However, during the last 10 years a new trend has emerged to lease the physician workforce to health centres from private firms. Eleven per cent of physicians have a private practice as a full-time job and 30% work full-time in the public sector but hold a private practice outside their regular working hours. Since the late 1990s there has been a significant shortage of physicians in Finland, which has had a significant impact on the developments of the health care system. In order to rectify this situation the yearly intake of medical students has been increased considerably. The most important state level reforms from the beginning of the 1990s have been: • the deregulation of state steering of municipal health services and related changes in state administration (1993); • the National Project to Ensure the Future of Health Care (2002–2007); • the extension of public dental health care to all age groups (2002); • introduction of the waiting time guarantee (2005); • the project to restructure municipalities and services (ongoing since 2005); and

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â&#x20AC;˘ the development of the national electronic patient record system (ongoing since 2006). In addition, there have been several reforms concerning pharmaceuticals, with one important goal being to further promote cost containment. In terms of the distribution of benefits, there are two major challenges in the Finnish health care system: geographical inequities and inequities between socioeconomic groups. There are significant differences between municipalities in service provision (for example in physician visits, dental care, mental health care, elective surgery) and waiting times. There are also significant differences between municipalities in resources invested in municipal health care leading to differences in the quality and scope of municipal services. However, these inequalities can also partly be explained by other differences between municipalities such as age structure, morbidity rates and use of private and occupational health care services. There are also significant socioeconomic inequalities in the use of health care services. Among OECD countries pro-rich inequity in physician visits was found to be one of the highest in Finland (along with the United States and Portugal) in 2000. Significant pro-rich differences are also evident in screening, dental care, coronary revascularizations and in some elective specialized care operations (hysterectomy, prostatectomy and lumbar disc operations). Although overall mortality has fallen, the socioeconomic inequality in mortality seems to be increasing. The Finnish health care system offers relatively good quality health services for reasonable cost with quite high public satisfaction. The most visible problems are long waiting times and personnel shortage in some municipalities. An ageing population, new medical technology, drug innovations and increasing population expectations will create challenges for the Finnish health care system in the near future. There are also some structures in the Finnish health care system which are perceived as problematic: the level of decentralization, poor steering capacity in the system, relatively weak position of primary care, a lack of cooperation between primary and secondary care and dual financing.

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1. Introduction

1.1 Overview of the health system

n practice in Finland there are three different health care systems which receive public funding: municipal health care, private health care and occupational health care (Fig. 1.1 and Table 1.1.). Usually, employed persons have the possibility to choose between these. According to a population survey, about 45% of physician visits of employed people were in occupational health care, 35% in municipal health care and 15% in private health care (PerkiöMäkelä et al. 2006). For low-income unemployed people the municipal health care system is, in practice, the only choice. There are significant differences between the systems, for example in the scope of services, user-fees and waiting times. There are also different public financing mechanisms for health care services in Finland: municipal financing based on taxes and National Health Insurance (NHI) financing based on compulsory insurance fees (this is henceforth referred to as “dual financing”). Municipalities fund municipal health care services (except outpatient drugs and transport costs) and NHI funds, for example, private health care, occupational health care, outpatient drugs, transport costs and sickness allowance. The largest share of health care services is provided by the municipal health care system (71% of outpatient physician visits, 59% of outpatient dentist visits and 95% of inpatient care periods). In 2008 there were 415 municipalities in Finland, with a median number of inhabitants of 5000. Municipal health care services are financed by municipal taxes, state subsidies and user-fees. All municipalities are, by law (Primary Health Care Act), obliged to maintain health centres for the provision of primary health care services, either on their own or jointly through a local federation of municipalities. There were 237 health centres in Finland in 2007 (excluding Åland Islands). Practically all health

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Overview chart on health system Health insurance fee

Tax funding Parliament

Social Insurance Institution

Government

STAKES

Ministry of Social Affairs and Health Provinicial State Offices (5)

State owned hospitals (2)

The National Agency for Medicines

The National Authority for Medico-legal Affairs

Municipalities (415) Private companies for leasing professionals

Pharmacies (804)

Reimbursement for patient

Fig. 1.1

Finland

Private providers - for-profit hospitals - outpatient clinics - third sector, not-forprofit hospitals - call centres

Hospital districts (20) Health centres (237)

Specialist level hospitals

Municipal hospitals or inpatient wards

Employers (occupational health care)

Primary care/ health stations

Hierarchical relationship Contractual relationship

Funding Regulation

Note: STAKES: National Research and Development Centre for Welfare and Health.

centres have general practitioner (GP)-run inpatient units or an arrangement for using such beds in a nearby health centre. Municipalities with their own health centres usually use prospective budgets. In federation-owned health centres the budgets are built in a similar way but the sharing of costs between member municipalities is usually determined by the volume of services given. Physicians in health centres are usually salaried employees of the municipalities. The payment system of GPs in municipal health centres varies. Specialist level care in the municipal health care system is provided by 20 hospital districts. Each municipality must belong as a member to one of the hospital districts (Act on Specialized Medical Care). Each hospital district has one or several hospitals, of which one is a central hospital. The hospital district organizes and provides specialist medical services for the population of their member municipalities. Hospital districts are managed and funded by the member municipalities. Hospital districts have varied methods for collecting funding. The majority of funding collected is based on actual clinical services used. The population base of hospital districts varies from 65Â 000 to 1.4 million.

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Table 1.1

Finland

Services funded by public sources (municipalities and NHI) in 2005

Municipal health care Private health care Occupational health care1

Outpatient physician visits2 71% 16% 13%

Outpatient dentist visits 59% 41%

Inpatient care periods3 95% 5%

Occupational curative medical care Includes primary and secondary care 3 Inpatient care periods reported by the hospitals 1 2

Sources: SII 2007b, SII 2007a, STAKES 2006b, STAKES 2007b. Note: NHI: National Health Insurance.

Municipalities can also purchase health care services (primary health care services or specialized health care services) from other municipalities, other hospital districts, private providers or from the third sector. The Åland Islands are an autonomous Swedish-speaking region with 16 municipalities and 26 000 inhabitants. The Åland Government is responsible for providing health care services in the region. Services which are not provided in the region are purchased from Finland or Sweden. Seventeen per cent of the total cost of health care in Finland is financed by the statutory NHI scheme. The scheme is run by the Social Insurance Institution (SII, Finnish acronym KELA), with about 260 local offices throughout the country. SII falls under the authority of Parliament. The main funding to NHI comes from the state budget (28% in 2006), the insured (33%) and employees (38%). NHI covers part of outpatient drug costs, part of medical costs in the private sector, part of the costs of occupational health care, compensation of travel costs to health care units, sickness allowance and maternity leave allowance. Of services funded by public sources (municipalities and NHI), about 16% of outpatient visits to physicians, 41% of outpatient visits to dentists and 5% of inpatient care periods are provided by the private sector (Table 1.1). Employers are obliged to provide preventive occupational health care for their employees (under the Occupational Health Care Act). As part of occupational health care, many large- or medium-sized employers also provide curative outpatient services (13% of outpatient physician visits are provided by the occupational health care system). Occupational health services can be provided by the employer itself or the employer can purchase them from another employer (42% of expenses in 2004), or from the municipal health centres (16% of expenses), from private health care providers (29% of expenses) or from other sources (12% of expenses). The NHI scheme covers about 40% of the expenses (SII 2007b).

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Pharmacies are mainly privately owned by pharmacists. There were 804 pharmacies in Finland in 2006 (NAM 2007). They are regulated in several ways: their margins and prices are fixed by the Government, they cannot be owned by companies, and the National Agency of Medicines (NAM) decides in which locations pharmacies are placed and who runs them. Outpatient drugs are partly reimbursed by NHI. These reimbursements are paid mainly directly to pharmacies. The Ministry of Social Affairs and Health (MSAH) directs and guides social and health services at the national level. It defines general social and health policy, prepares major reforms and proposals for legislation, monitors their implementation and assists the Government in decision-making. The Government decides on general national priorities and proposes bills to be discussed by the Parliament. The lower level of state administration comprises five provinces plus the autonomous Åland Islands. The provincial state offices promote national and regional objectives of the central administration, and keep contacts with municipalities in their area. Their social and health departments are responsible for, among other things, guiding and supervising both municipal and private health care providers.

1.2 Geography and sociodemography Finland is an independent republic located to the north-east of the Baltic Sea. It is bordered by Norway to the north, the Gulf of Finland to the south, Sweden and the Gulf of Botnia to the west and the Russian Federation to the east (Fig. 1.2). Estonia is situated close to the south, across the Gulf of Finland. The Finnish language is closely related to the Estonian language and belongs to the Finno-Ugric language family. The land area is 338 145 km2. Some 68% of it is covered by forests, 10% by water, and 6% is under cultivation. The climate is marked by cold winters and warm summers where the Gulf Stream has some influence. Much of the country is sparsely populated, with an average population density of 16/km2. The bulk of the population is concentrated in the urban areas of the southern and western parts of the country, while roughly a third lives in rural areas. In 2005 the population of Finland was 5.26 million (Table 1.2). The majority of the population is Finnish speaking (92% in 2005) and Evangelic Lutheran (83%). Swedish is another official language in Finland (besides Finnish) and 5.5% of the population speaks Swedish as their first language. The Finnish population grew by about a quarter of a million per decade

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Fig. 1.2

Finland

Map of Finland

Source: CIA 2007.

during the 20th century, growth being rapid in the first half of the century and slowing down towards the end. People under 15 years of age constitute about 17% of the total population and those over 65 years some 16% (in 2005). The number of people aged 65 years or over is expected to grow by about 600 000 (i.e. by over 50%) in the next 15 years. Because of the ageing population, the economic dependency ratio (the number of non-employed relative to the number of employed) will become less favourable, particularly after the year 2015.

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Table 1.2

Finland

Population/demographic indicators, 1970–2005 (selected years)

Population (million) Population, female (%) Dependency ratio1 (%) Swedish speaking population (%) Population aged 0–14 (% of total) Population aged 65 and above (% of total) Population density (people per sq km) Single person households (%) Urban population (% of total population)2 Fertility rate, total (births per woman) Live births per 1000 population Death rate, crude (per 1000 people)

1970 1980 4.60 4.79 52 52 50.7 47.5 6.6 6.3

1990 1995 5.00 5.12 52 51 48.7 – 5.9 5.8

2000 2002 2004 2005 5.18 5.21 5.24 5.26 51 51 51 51 49.4 49.6 50.0 49.8 5.6 5.6 5.5 5.5

24.0

20.3

19.3

19.0

18.1

17.9

17.5

17.3

9.2

12.0

13.4

14.2

14.9

15.3

15.7

16.0

15.1

15.8

16.4

16.8

17.0

17.1

17.2

17.3

– 50

27.1 60

– 60

35.2 63

37.3 59

38.4 61

39.3 61

39.7 –

1.8

1.6

1.8

1.7

1.8

14.0 9.6

13.2 9.3

13.1 10.0

12.3 9.6

10.9 9.5

10.7 9.5

11.0 9.1

Sources: Statistics Finland, 2005; 2WHO Regional Office for Europe, January 2007. Note: 1proportion of the under 15 year-olds and over 64 year-olds from other population.

1.3 Economic context The Finnish economy is based on industry and services. Finland’s industry has traditionally been built on harnessing forest resources. Forests are still an important raw material but engineering and high technology, led by information technology, have now become other leading industries. Finland is relatively dependent on foreign trade. The main export products are electro-technological products, pulp and paper and machinery and equipment. The main import products are raw materials and other production necessities, investment goods and consumer goods. Between 1990 and 1993 Finland suffered a major economic recession. The economy shrank by almost 15% and massive unemployment emerged, the unemployment rate rising from 3.5% to 19% in the same period. The state had to finance many public sector activities by taking up a growing amount of debt. The economies of the municipalities also suffered from the crisis to various degrees. The recession was caused by a number of factors such as the global economic slowdown, the collapse of trade with the former Soviet Union, and sudden liberation of capital flows.

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Table 1.3

Finland

Macroeconomic indicators, 1996–2005 (selected years)

GDP (milion euro) GDP per capita (euro) GDP growth (annual %) Unemployment (% of labour force) Labour force (total, million) Poverty rate (less than 60% of median income %) Income inequality (GINI %)

1996 1998 2000 2002 2004 2005 99 258 117 111 132 272 143 974 151 935 157 377 19 367 22 727 25 555 27 682 29 066 30 005 3.7 5.2 5.0 1.6 3.5 2.9 14.6 11.4 9.8 9.1 8.8 8.4 2.49 2.51 2.59 2.61 2.59 2.62 8.3 9.7 10.4 11.0 11.9 12.3 22.1

24.6

26.5

25.5

26.5

Source: Statistics Finland, 2006b.

Since 1994, Finland has been recovering from the crisis (Table 1.3). By 2003, real GDP per capita (purchasing power adjusted) was close to the European Union (EU) average (members before May 2004, EU15). The state debt has decreased from the worst figures in the mid-1990s: in May 2007 it was 57 billion euros, about 10 800 euros per inhabitant and about 35% of GDP (before the recession in 1991 the state debt was less than 20% of GDP and peak of the debt was in 1998 when it was about 70 billion euros). The overall economic situation in the municipalities also improved after the mid-1990s but it has recently worsened again. In 2007 municipalities’ total debt was almost 9 billion euros, about 5% of GDP (about 4 billion euros in 2000). About 20% of the municipalities ran deficits in 2006. During the last 10 years unemployment has been reduced following the rapid growth in the national economy and the employment policy of the Government. In January 2008, the unemployment rate fell to 6.8%. Unemployment has become more polarized, however: those who have recently become unemployed usually find a new job rapidly, but the situation of those who have prolonged difficulty in finding work is becoming even worse. Also, the structural features of unemployment have become more obvious: the older long-term unemployed find it more and more difficult to become employed, and regional differences in unemployment have grown. The growing regional differences in unemployment can be observed in the continuing population drift from rural areas to the large cities in the south and west of Finland. This internal migration is the largest since the 1970s, when the previous large wave of internal migration was seen. There are between five and seven “growth centres” at present. Although there has generally been an increase in the number of available jobs almost everywhere in the country, the majority of new jobs are located in southern Finland. This, together with the changes in working life, such as the dwindling of traditional industries and

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unstable employment, are forcing working age people to move to the large cities in the south and west. At the same time, the proportion of old people is growing in the regions that are being abandoned. The financial basis for arranging basic services is likely to weaken as the number of working age people diminishes in these regions. Internal migration is also likely to lead to significant changes in social networks and possibly in the service structure in all regions.

1.4 Political context Having been under Swedish rule for 600 years and then under Russian rule for 100 years, Finland became an independent republic with its own constitution in 1917. After that, the country’s development was influenced by two wars: the civil war and later the Second World War. The Finnish public administration system consists of three levels: state, province and municipality. The provinces are actually regional representatives of the central state administration. Their administrators are appointed by the state; they do not have any democratically elected organs. Finland is divided into five administrative provinces and the Åland Islands, the latter having autonomous status. Finland has a Constitution (latest major review in 2000). Power in Finland is vested in the people, who are represented by deputies assembled in Parliament. Legislative power is exercised by Parliament, the President of the Republic having a minor role. The Council of State (the Government) consists of a Prime Minister and a requisite number of ministers. Judicial power is vested in independent courts of law, at the highest level in the Supreme Court and the Supreme Administrative Court. The head of state is the President of the Republic, who is elected for a period of six years by direct popular vote. In practice, the President’s power in political areas other than foreign policy is limited; but the power to accept laws and to appoint senior civil servants does incorporate the potential for acts of political significance. For the first time in Finnish history, a female president, Mrs Tarja Halonen, was elected in March 2000 and re-elected in March 2006. The Parliament has a single chamber of 200 representatives, elected for a fouryear term by direct popular vote. Parliament has three main functions through which it represents the people and makes basic decisions on Finnish policy. It passes laws, it debates and approves the national budget and it supervises the way the country is governed. Passing laws is a complicated process that usually begins with the Government placing a bill before Parliament. To be passed, a bill must have the support of a majority in Parliament and it must

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be signed by the President of the Republic. Finland’s presidents have refused to sign a law once a year on average. Moreover, Parliament may approve the same law again after it has been rejected by the President. If this happens, the President must then sign it. After the parliamentary elections in March 2007, the seats were divided among the political parties as follows: the Finnish Centre Party, 51 seats (23% of votes); the National Coalition Party, 50 (22%); the Finnish Social Democratic Party, 45 (21%); the Left Wing Alliance, 17 (9%); the Green Party, 15 (9%); the Swedish People’s Party, 9 (5%); the Finnish Christian Union, 7 (5%) and the True Finns Party, 5 (4%). The Government must enjoy the support of a majority in Parliament. The Parliament elects the Prime Minister (who is then formally appointed by the President). Other ministers are appointed by the President under the proposal of the Prime Minister. The Government is the executive body that produces material for Parliament to consider, for example the bills placed before Parliament. The Government (and different ministries) can enact lower level decrees in certain cases. Since the voting system is proportional, no single party can form a majority to govern, which leads to coalitions, and relative stability of the political system. The present Government, formed in April 2007, is a coalition of the Finnish Centre Party (eight ministers), the National Coalition Party (eight ministers), the Green Party (two ministers) and Swedish People’s Party (two ministers). The Prime Minister is Mr Matti Vanhanen (the Finnish Centre Party). Mr Matti Vanhanen was also the Prime Minister of the previous Government, which was a coalition consisting of the Finnish Centre Party, the Social Democratic Party and the Swedish People’s Party. Closest to the people are the 415 self-governing municipalities, which are all governed according to uniform national legislation. Many responsibilities, including primary education and the social and health services, are devolved to the level of municipalities. The tradition of devolving responsibility to municipalities has a long history in Finland, evolving over several centuries. In the municipalities the municipal councils are the main decision-making bodies. They are elected for a four-year term. Municipalities levy a municipal income tax, the rate being decided independently by each municipality (it varies from 16% to 21% of taxable income, and between 17.5% and 19% in the 10 largest municipalities). Municipalities also receive other tax revenues (real estate tax and part of the corporate tax), subsidies paid by the state and other revenues (such as user-fees). Municipalities and joint municipal organizations account for almost two thirds of all public expenditure in Finland. Most of the

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municipalities’ expenditure arises from arranging basic services such as social and health services, primary education, cultural services and infrastructure. Cooperation with the other Nordic countries – Denmark, Iceland, Norway and Sweden – has long existed and covers a large number of issues, ranging from social and cultural to technical matters. Finland became a member of the EU in 1995. This membership gave new duties and roles to the political institutions, and in many instances national legislation has had to be amended to correspond with EU legislation. The impact of EU membership on the Finnish economy is difficult to evaluate, as many other factors such as the preceding economic recession also had an influence. Finland was one of the first countries to enter the third stage of the Economic and Monetary Union in 1999. Finland is also a member of the United Nations, the Council of Europe and the World Trade Organization. Finland is not a member of the North Atlantic Treaty Organization. The human rights situation in Finland is relatively good. Corruption is rare in Finland and Finland is the least corrupted country in the Corruption Perception Index held by Transparency International (TIN 2007). Although the human rights situation is considered to be good in Finland, some problems have been identified. Human Rights Watch has been worried about Finland’s stockpile of landmines which are intended to be used during war. Amnesty International has focused on the problem that Finnish men who refuse to take part in the system of compulsory military service or replacement civilian service because of ethical reasons are sentenced to imprisonment (Amnesty International 2007). Amnesty International has also drawn attention to the practice where in some cases of problematic deportation of refugees, officials in Finland have administered sedating and neuroleptic medication without proper examination by a medical doctor (Amnesty International 2004).

1.5 Health status According to various indicators, the health of the Finns has considerably improved over the last few decades. Average life expectancy among the Finnish population has improved throughout the 20th century, especially during the last three decades. In the 1950s and 1960s, mortality among Finnish men was notably high when compared to international standards, mainly due to the high prevalence of coronary heart disease. Life expectancy has grown considerably since then, to 76 years for men and 83 years for women in 2005 (Table 1.4). During the 1980s and 1990s the improvements in life expectancy in Finland were mainly due to 10

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Table 1.4

Finland

Mortality and health indicators, 1970–2005 (selected years)

Life expectancy at birth, total (years) Life expectancy at birth, male (years) Life expectancy at birth, female (years) Crude death rate per 1000 population, female Crude death rate per 1000 population, male Infant deaths per 1000 live births

1970 1980 70.4 73.7 66.2 69.2 74.5 78.0 8.5 8.4

1990 75.1 71.0 79.1 9.8

1995 76.8 72.9 80.4 9.6

10.7 10.3 10.4

9.8

9.5

13.2

4.0

3.6

7.6

5.6

2000 2003 77.9 78.7 74.3 75.2 81.3 82.1 9.5 9.4

2004 79.0 75.4 82.5 8.9

2005 79.4 75.8 82.7 8.9

9.4

9.3

3.2

3.3

3.1

Source: WHO Regional office for Europe, January 2007.

the decline in mortality amenable to health care (avoidable mortality), especially in mortality from ischaemic heart disease, although in the 1990s the contribution of avoidable mortality was somewhat smaller (Nolte and McKee 2004). The potential years of life lost (PYLL) rate has lowered in Finland between 1992 and 2004 by approximately 25% (Vohlonen, Bäckmand, Korhonen 2007). In 2002 healthy life expectancy in Finland was 71.1 years (Table 1.5). In a comparative study by Nolte and McKee (2003) using an aggregate measure of avoidable mortality (not including deaths from ischaemic heart disease) from the year 1998, Finland ranked middle among 19 countries of the OECD, performing worse than for example Sweden and Norway. Infant mortality has also decreased rapidly over the last 30 to 40 years. At the beginning of the 1970s, almost 15 out of every 1000 newborn infants died; since the mid-1990s the rate has been less than 5 per 1000 newborns, one of the lowest in the world. There are still significant differences in mortality and health between groups with different socioeconomic status, education, marital status, gender and geographical regions. Differences between socioeconomic groups and marital status groups are increasing while differences between genders are decreasing (Martelin, Koskinen, Lahelma 2006). The average life expectancy of a white collar worker male aged 35 years is six years longer than that of a manual worker of the same age; for women the corresponding difference is smaller (three years). The largest minority in Finland are Swedish speaking people, who comprise 5.5% of the Finnish population. It has been found that Swedish speaking people living on the west coast are healthier than Finnish speaking population living in the same area (Hyyppä and Mäki 1997). The most significant public health problems are circulatory diseases, malignant tumours, musculoskeletal diseases and mental health problems (Table 1.6). Emerging problems are obesity, chronic lung diseases and diabetes, particularly type 2 diabetes. 11

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Table 1.5 Healthy life expectancy, 2002 Total population At birth 71.1 Males At birth 68.7 At age of 60 15.7 Females At birth 73.5 At age of 60 18.9 Source: World Health Report, 2004.

According to the national health survey (Helakorpi et al. 2008) in 2007 68% of the 15–64 year old population reported having good or reasonably good health status. In the Health 2000 Study 43% of all working age people and 80% of people aged over 64 reported at least one long-term illness in 2000 (Aromaa and Koskinen 2002). According to the survey for school aged children in 2003, about 9% of 12 to 18 year-olds had a long-term illness which had an influence on everyday activities (Rimpelä et al. 2004). In 2006 about 7% of the working age population had a disability pension (ETK and KELA 2007b) and in 2007 19% of the working age population in Finland reported themselves as having restricted capacity to work because of illness or disability (Helakorpi et al. 2008). Cardiovascular diseases made up 41% of all causes of death in 2005 (compared to 52% in 1983) (Statistics Finland 2006a). The incidence and mortality from coronary heart disease increased at the end of the 1960s, but has significantly dropped since then. Among working age people age-standardized mortality from coronary heart disease dropped more than 50% between 1984 and 2005 (Statistics Finland 2006a). The annual number of myocardial infarctions has decreased during the last 10 years, especially among the working age population. According to the national health survey 16% of 15 to 64 year-olds reported having high blood pressure and 14% having a high blood cholesterol level in 2007 (Helakorpi et al. 2008). This positive development is due, inter alia, to changes in lifestyle (e.g. reduced smoking rates and nutritional habits) and improved medical treatment. Regional and social group differences in mortality from coronary heart disease still persist. For example, age-standardized coronary heart disease mortality is significantly greater among men in eastern Finland than in western and southwestern Finland. Mortality from ischaemic heart disease among working age men was more than six times greater than among working age women in 2005 (Statistics Finland 2006a). 12

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Table 1.6

Finland

Main causes of death (underlying cause of death, deaths per 100 000)

1985 1990 1995 2000 2004 2005 I. Communicable diseases: Infectious and parasitic diseases (A00-B99, J65) 7.6 8.6 7.5 7.6 6.5 7.0 Tuberculosis (A15-A19, B90, J65) 3.6 3.6 2.6 2.5 1.3 0.0 II.

Noncommunicable conditions: Circulatory diseases (I00-I425, I427-I99) Malignant neoplasms (C00-C97) Trachea/bronchus/lung cancers (C32-C34) Respiratory diseases (J00-J64, J65-J99) Dementia, Alzheimer’s disease (F01, F03, G30, R54) Digestive diseases, excluding alcohol-related diseases Alcohol-related diseases

III. External causes (V01-X44, X46-Y89)

515.3 480.2 443.0 411.2 373.7 373.8 193.6 196.4 196.6 197.5 199.7 201.5 43.3 39.9 37.4 36.3 36.3 37.6 77.9 75.0 73.5 82.9 56.5 46.9 20.4 44.8 56.2 67.2 75.4 78.8 23.2

26.4 27.6

26.8

25.8

26.2

15.7

23.2 23.3

28.5

35.4

38.2

72.1

87.1 77.3

72.1

73.7

71.4

Source: Statistics Finland, 2004.

Cancer is the second most common cause of death after circulatory diseases. More than one in four Finns suffer from cancer at some stage in life. Ageadjusted incidence rates of cancer increased by 10% among males and 21% among females during the last 20 years (Cancer Society of Finland 2005), while age-standardized cancer mortality somewhat decreased during the same period (Statistics Finland 2006a). Stomach and cervical cancer mortality particularly have experienced significant decreases, while mortality due to melanoma and liver cancers has increased. Mortality from prostate cancer has remained constant and mortality from breast cancer has increased only moderately. The most common types of cancer among men are prostate cancer (34% of new cancer cases in 2003) (Cancer Society of Finland 2005), lung cancer and colorectal cancer. The most common types of cancer among women are breast cancer (32% of new cancer cases in 2003), colorectal cancer and uterine cancer. The prognosis of cancer patients has continuously improved. During the last 20 years, five-year relative survival rates have improved among males from 34% to 56% and among females from 49% to 65% (Cancer Society of Finland 2005). The most common reason for claiming sickness allowance – 33% of sickness periods in 2006 – is musculoskeletal diseases (SII 2007c). Almost half of sickness periods were due to back disorders and one fourth due to osteoarthritis. According to the national health survey, 11% of the population aged 15 to 64 years had back problems in 2007 (Helakorpi et al. 2008). According to another study conducted in 2000, about 6% of the population over the age of 13

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30 suffered from osteoarthritis of the knee (35% of women and 46% of men over 85 years) (Aromaa and Koskinen 2002). The number of people suffering from musculoskeletal diseases is expected to increase because of the ageing of the population, diminishing physical exercise and increasing overweight. Improved diagnostic and therapeutic methods also reveal an increasing range of musculoskeletal diseases. According to Helakorpi et al. (2008), 6% of the working age population suffered from depression diagnosed by a physician in 2007. This was more common among women. Mental health disorders as a reason for sickness day allowance and disability pension have increased during the last 10 years. In 1992, 32% of all persons claiming disability pensions did so because of a mental health disorder compared to 43% in 2005 (ETK and KELA 2007a). Mental health disorders were the second most common reason for sickness day allowance, comprising 16% of sickness day allowances (SII 2007c). Allergies and asthma are rapidly growing health problems in Finland. About 5% of the working age population suffered from asthma diagnosed by a physician in 2007 (Helakorpi et al. 2008). Eczema is also a common problem (prevalence is about 17% of the working age population in 2007). According to the Health 2000 survey, 0.7% of men over the age of 30 and 0.3% of women had type 1 diabetes in 2000 (Aromaa and Koskinen 2002). In 2001, the incidence among under 15 year-olds was 56/100 000 (Karvonen 2004). Type 1 diabetes is more common in Finland than in any other country in the world. During the last decades the incidence has increased steadily (from 18/100 000 in 1965 at a rate of 3.5% per year). The reasons for this increase are mainly unknown, but currently under intensive study. The prevalence of type 2 diabetes is also fairly high compared to other western countries. In the Health 2000 survey, 4.4% of males and 3.0% of females over the age of 30 had type 2 diabetes in 2000 (Aromaa and Koskinen 2002). It is estimated that during the years 1969 to 2003 the number of type 2 diabetes patients increased from 50 000 to 190 000 (Reunanen 2004). If people that are unaware of their condition are included, the current figure is estimated to rise to 400 000 which is 12% of the population aged 30 years or older. With the ageing of the population, dementia will gain more importance as a public health problem. It is estimated that there are about 110 000 patients with some form of dementia (Soininen 2005). Mortality from dementia increased from 20.4/100 000 in 1985 to 78.8/100 000 in 2005 (Table 1.6). However, part of this is due to changed practices of classifying dementia as the underlying cause of death. Suicide mortality in Finland has generally been one of the highest in Europe. Suicide rates were highest towards the end of the 1980s, when the Finnish 14

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economy was booming, being almost 30 per 100 000 population in 1990. The trend has been decreasing since then, being 18 per 100 000 population in 2005 (Statistics Finland 2006a). One reason for this may be the large national suicide prevention project which was carried out between 1986 and 1996. The number of abortions fell from a peak of over 23 000 in 1973 to 10 900 in 2005 (9.3 per 1000 women of childbearing age and 190 per 1000 life births) (STAKES 2006b). The number of abortions among females in the age group 15–19 years was 14.9 per 1000. The abortion rate in Finland is the lowest among Nordic countries. Keeping abortion rates low by employing a variety of measures through school and maternity health services and general arrangements of family planning has been a high priority for decades. One of the major changes in the lifestyle of Finnish people during the last decades is the change in dietary habits. One example of this change is the more frequent use of margarine instead of butter on bread. Twenty years ago more than 60% of people used mainly butter on bread while in 2007 this figure fell to only 4% of men and 3% of women (Helakorpi et al. 2008). Also, use of low fat milk, vegetables and vegetable oil in cooking has significantly increased (Table 1.7). Nevertheless, being overweight remains an increasing problem in Finland. In 2006, 55% of men and 41% of women were overweight (compared to 42% and 31% between 1978 and 1982). The prevalence of smoking among men has fallen since the 1960s, but among women the prevalence has been rather stable. 18% of working age women and 23% of working age men were daily smokers in 2006 (Table 1.7). During last the 20 years alcohol consumption has risen from 7.6 litres (in 1985) to 10.5 litres, 100% alcohol equivalent per capita in 2005 (the figure includes both recorded and estimated unrecorded consumption) (STAKES 2006d). This is an average level for western industrialized countries. Anticipating the EU membership of neighbouring Estonia in 2004, under the EU free market regulations, Finland decided to lower the alcohol tax in 2003, in order to smooth over great price differences and to counteract expected large imports and ensuing loss of alcohol taxes. It seems that partly because of this, alcohol consumption rose by 10% between 2003 and 2004 (STAKES 2006d). According to a survey conducted in 2007, 28% of men and 9% of females consumed six or more doses of alcohol (one dose is equivalent of 4cl of 40% spirit) on one occasion at least once a week (2.9% and 0.6% almost daily) (Helakorpi et al. 2008). The number of heavy drinkers is estimated to be between 250 000 and 500 000 (STAKES 2006d). In 2005, about 2000 people died from alcohol intoxication or due to an illness related to alcohol consumption (29% increase from 2003). Alcohol-related death is the second most common cause of death among working age men and women. Alcohol use among young people 15

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Table 1.7

Factors affecting health status (working age population)

Males Overweight (BMI>25) Leisure-time physical excercise (at least twice a week) Daily smokers Use of skimmed or semi-skimmed milk Use of mostly vegetable oil in cooking Daily consumption of fresh vegetables Females Overweight (BMI>25)

Finland

Leisure-time physical excercise (at least twice a week) Daily smokers Use of skimmed or semi-skimmed milk Use of mostly vegetable oil in cooking Daily consumption of fresh vegetables

1978– 1983– 1988– 1993– 1998– 2002– 2006 2007 1982 1987 1992 1997 2001 2005 42% 44%

43% 48%

46% 50%

50% 58%

52% 60%

55% 60%

55% 63%

57% 67%

35% 4%

33% 6%

33% 18%

29% 30%

28% 36%

27% 39%

24% 43%

26% 46%

26%

32%

41%

45%

46%

16%

20%

24%

27%

28%

29%

30%

31%

35%

42%

45%

52%

60%

36% 63%

38% 66%

41% 68%

43% 73%

17% 6%

18% 11%

20% 27%

19% 37%

20% 42%

19% 47%

19% 53%

17% 52%

10%

29%

35%

44%

49%

53%

23%

28%

35%

39%

45%

44%

48%

47%

Source: Helakorpi et al. 2008. Note: BMI: Body mass index.

is also common. According to the school survey conducted in 2005 among 14 year-olds, 4% of boys and 6% of girls drank at least once a week (among 16 year-olds, 19% of boys and 15% of girls drank at least once a week) (STAKES 2006d). According to statistics, alcohol consumption per capita is highest in the northern part of Finland (Lapland). Oral health has improved markedly during the last 30 years, especially among children and adolescents. Since the early 1970s when the Primary Health Care Act came into force, children and adolescents have attended oral health check-ups regularly. This policy seems to have been effective. In 1976, only 1% of 12 year-olds had healthy teeth, whereas in 2000 the corresponding figure was 38% (Nordblad et al. 2004). Among the same population the number of decayed, missing or filled teeth decreased from 5.2 to 1.3 between the years 1979 and 2003 (Table 1.8). The number of annual dental fillings halved between the years 1985 and 2000 among children and adolescents under 18 (Nordblad et al. 2004). 16

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Table 1.8

Finland

Dental health

1978– 1983– 1988– 1993– 1998– 2002– 2006 2007 1982 1987 1992 1997 2001 2005 No missing teeth (working age population)1 22% 29% 36% 41% 46% 48% 50% 50% DMFT at age 12 years (mean value)2 5.2 2.8 1.2 1.2 1.2 1.2 Source: 1Helakorpi et al 2008; 2OECD, 2007. Note: DMFT: Decayed, missing or filled teeth (years 1979, 1985, 1991, 1994, 1997, 2000, 2003).

Until the early 1990s, drug abuse was not a major problem in Finland, but there has been a rapid rise in the use of drugs since then. However, the increase has slowed during last few years. Also crimes related to illegal drugs have increased during the last 10 years. In 2004, 12% of 15–69 year-olds had used or tried cannabis and 3% of them had used it during the last year (STAKES 2006d). About one fifth of 15–34 year-olds has tried cannabis at least once. The use of other illegal drugs in Finland is less common. Amphetamine is the second most commonly used illegal drug in Finland. In 2004, about 1–2% of the adult population had tried amphetamine or ecstasy, and 0.5% during the last year (STAKES 2006d). Based on data from several registers (the Hospital Discharge register; a register of the Finnish Police; the National Communicable Disease Register; and the register of people driving a motor vehicle when intoxicated), it is estimated that in 2005 between 0.5% and 0.7% of 15–54 year-olds had a problem with opiate or amphetamine use (Partanen et al. 2007). This figure increased between 1999 and 2005, the problem being most common among men, among 15–34 year-olds and in the metropolitan Helsinki area. According to the ESPAD survey (The European School Survey Project on Alcohol and Other Drugs), 11% of 15–16 year-olds had tried some illicit drugs in Finland in 2003 (STAKES 2006d). Vaccination coverage is good in Finland (see Fig. 1.3 for measles). Ninetythree per cent of children born in 1999 had all the vaccinations included in the national vaccination programme in 2005 (Joensuu et al. 2005). The national vaccination programme was last revised in 2006, when vaccination against tuberculosis was removed, now being given only to children at risk. In the current national vaccination programme all children are vaccinated against diphtheria, tetanus, pertussis, measles, mumps, rubella, polio and Hib. The measles, mumps and rubella vaccination was included in the programme in 1982 and 12 years later Finland was the first country in the world to have eliminated these diseases. In the late 1990s, only sporadic cases of these diseases were seen in Finland (the infections were acquired from foreign countries). Hib vaccination is a similar success story. 17

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Human Immunodeficiency Virus/Acquired Immunodeficiency Syndrome (HIV/AIDS) has not been a major problem in Finland. In late 1990s, HIV incidence among intravenous drug users increased dramatically, but after that incidence has been rather stable (130–140 new infections a year). However, in 2006 incidence increased again by 39% (191 new cases of HIV were diagnosed in 2007), this time due to infections from sexual relationships. In February 2008, the total number of HIV positive cases identified in Finland was 2279 (National Public Health Institute). Road traffic deaths and injuries have significantly decreased in the last 15 years. In 2004, there were 6.5 deaths due to land traffic accidents per 100 000 population, compared to 14.1 in 1990 (Statistics Finland 2006a). Finland has actively, and rather successfully, tried to reduce deaths and injuries from road traffic accidents. For example in the late 1980s, it became law for back seat passengers to wear a seatbealt and in the early 1990s winter time speed limits were expanded to apply to the whole country.

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Fig. 1.3

Finland

Levels of immunization for measles in the WHO European Region, 2005 or latest available year (in parentheses) Western Europe

Monaco (2004) Andorra (2004) Finland Spain Netherlands Israel Sweden Luxembourg Denmark San Marino Germany Portugal Turkey Austria Norway Iceland Greece (2004) Belgium Italy Cyprus Malta France (2004) Ireland United Kingdom Switzerland Central and south-eastern Europe Hungary (2004) Poland Slovakia Lithuania Albania Czech Republic (2004) Romania The former Yugoslav Republic of Macedonia Bulgaria Estonia Serbia Croatia Latvia Slovenia (2004) Bosnia and Herzegovina CIS Kazakhstan Uzbekistan Belarus Turkmenistan Kyrgyzstan Russian Federation Azerbaijan Republic of Moldova Ukraine Armenia Tajikistan Georgia Averages CIS average EU average EU Member States before May 2004

99.0 97.6 97.0 96.8 96.3 96.0 95.4 95.4 95.0 94.1 93.3 92.6 91.0 91.0 90.0 90.0 88.0 88.0 87.2 86.3 86.0 86.0 84.2 82.1 82.0 99.9 98.2 98.0 97.2 97.2 96.9 96.7 96.4 96.2 95.9 95.6 95.5 95.0 94.0 90.0 100.0 99.3 99.0 99.0 98.9 98.6 98.2 96.9 95.7 94.1 94.0 91.6 98.0 91.3 89.7

100

Percentage

Source: WHO Regional Office for Europe, January 2007. Note: CIS: Commonwealth of Independent States. 19

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2. Organizational structure

2.1 Historical background

he organization and financing of health care services has long been considered a public responsibility in Finland. Municipalities have been responsible for providing basic medical services since the 1870s (Mattila Y 2006). Taxation developed as the principle method of collective funding from that time, until the introduction of statutory NHI in the 1960s. Before the Second World War, municipalities concentrated mainly on public health and the treatment of tuberculosis, other communicable diseases and mental health. After the War, a new act was introduced to regulate municipal health care services. According to the act, every municipality had to contract GPs, midwives and public health nurses, usually providing them with facilities and accommodation. Most of a GP’s income came from payments from patients, but midwives and public health nurses were salaried. As the overall number of doctors was small, they had to handle a wide variety of health problems. The right to maternal and child health care was fixed in law in 1944, irrespective of residence and financial situation. The provision of hospital care was fairly modest in the first half of the 20th century. Before the 1950s, the hospital network was rather fragmented and general hospitals, psychiatric hospitals and tuberculosis hospitals were separate. Some of the hospitals were state owned while others were managed by municipalities or a group of municipalities. Hospital physicians’ income was based on a monthly salary. In 1950 there were 10 000 beds in general hospitals, 9000 beds in psychiatric hospitals and 6000 beds in tuberculosis hospitals. The development of the hospital system was given a major push in the 1950s. The responsibility for central hospitals was transferred to municipalities. Municipalities received a state subsidy to run them. During the 1950s and 1960s, the number of hospital beds in general hospitals tripled. Later, in the 1960s, 24 21

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new district hospitals were built (generally smaller than central hospitals) on the initiative of municipalities. These hospitals were by definition small scale specialist hospitals. As tuberculosis became less of a concern, tuberculosis hospitals were either closed down or transformed to become part of general specialist services of the district. Management of psychiatric hospitals was transferred to federations of municipalities in the 1950s. Hospitals were at that time divided into two categories, acute and long stay hospitals. Between the 1950s and 1970s the number of beds in psychiatric hospitals doubled. The volume of beds per population at that time has been cited to have been the highest in Europe, about 4 beds per 1000 population. At that time psychiatric hospitals catered for large numbers of demented elderly patients, for persons with learning disabilities and for persons with substance abuse problems. In the 1950s and 1960s, the majority of public expenditure on health care was allocated to hospitals and a significant imbalance between hospital care and outpatient care developed. Almost 90% of total public health care expenditure was spent on hospital care and only 10% on what was then primary care. A network of specialized hospitals with high standards existed, but the supply of outpatient services and primary health care was insufficient. In addition, ambulatory care by municipal doctors was quite expensive for patients compared to hospital care, mainly because the state subsidy to ambulatory health care was small. In order to rectify the imbalance between inpatient and outpatient care the NHI scheme was introduced in 1963. All inhabitants were covered by this mandatory scheme. Part of the costs of drugs, medical care and some other services were reimbursed through the scheme. It also included sickness day and maternity allowance (see section 3.2.2.3). Before this, only workplace-related voluntary relief funds had provided this type of insurance coverage, covering only a small proportion of the population. Despite the introduction of NHI there remained striking inequities in the availability of health services, since most of the services were concentrated in urban areas. Furthermore, the scheme excluded funding for health promotion and prophylactic measures, such as family planning and vaccination. The imbalance between primary and secondary health care persisted. Consequently, there was a clear need to improve the situation. There was also political will to develop health care, and the stable growth in the national economy secured the necessary resources. All these factors led to the introduction of new policies around the beginning of the 1970s. Firstly, a national planning system for primary health care with a rotating five-year plan that was annually updated was introduced. 22

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This system of strong state level steering was reinforced through state subsidies, which covered about 40% to 70% of the operating expenses of tax-funded health services. Besides the state subsidy for operating costs, the state also quite generously funded the building and equipping of facilities. Furthermore, a new system of primary health care was established through the Primary Health Care Act in 1972 (see 10.2 in the appendices for a list of principal legislation relating to health care in Finland). This new legislation introduced municipal health centres as the foundation of primary health care, with the objective of offering primary care services free of charge. At first, the health centres were organizations that assembled the previously dispersed and fragmented services under one administrative roof. Later in the 1970s and 1980s physical roofs materialized, as building of the facilities proceeded. The tasks of primary health care were then defined by law to be: primary medical care; a variety of preventive services; home nursing; family planning; dental care; and environmental health services. Some years later occupational and student health services and rehabilitation were added to the list. This all now amounts to an internationally unique network of health centres with perhaps the broadest scope of services and also the largest multi-professional teams at their service. Income of physicians in health centres is based mainly on a monthly salary. The number of doctors in primary care tripled during a few years in the 1970s. As a transitory measure a small nominal user charge was kept for about 10 years for non-preventive services for adults. Following an impassioned national debate, user-fees were reintroduced in 1993 during the economic recession (see section 3.3.3). The building of the first municipal health services was focused especially in the rural areas around local small GP-run hospitals (described henceforth as “inpatient wards”) and the GPs’ offices. This legacy has led to a very distinctive feature of Finnish health centres: the majority of them still have GP-run inpatient wards. One reason for having, and retaining, these small inpatient wards was the long travelling distance to specialist level hospitals. Many remote municipalities cherished them as sites providing versatile services, which in the 1970s and 1980s provided some basic operative and obstetric care. GPs working in health centres ran these inpatient wards along with outpatient clinics without any special training. Gradually, however, most of the operative care was transferred to specialist level hospitals and the inpatient wards became a fundamental part of chronic nursing home type care (see section 6.3). In the 1970s and 1980s, increasing attention was also paid to occupational health care, with the aim of extending it to all workers. The introduction of the Occupational Health Care Act in 1979 obliged employers to provide occupational health services to their employees. Special attention was given to preventive measures. Between 1964 and 1995 occupational health care coverage 23

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increased from 20% to 80% of the workforce. Curative services were soon added to the occupational health services through agreements between labour unions and employers and through channelling sickness insurance reimbursement for these services (see section 3.2.2.4). Hospital care was included in the national planning of public sector health care in 1974, and in 1984 new legislation brought certain social services (for example, children’s day care and homes for the elderly) into the same planning and financing system as health care. Since then, the collaboration of social and health care has been emphasized at both local and national levels. In the 1970s, the main focus of dental care at health centres was on children and adolescents, and strong emphasis was placed on prevention. Dental care in schools also existed before the Primary Health Care Act. Gradually, the scope of dental care widened to, for example, conscripts, pregnant women and students, and finally in 2002 dental services were offered to the whole population (see section 6.10). Until the end of the 1980s, the development of the Finnish health service was marked by continuous growth and differentiating of services. Regional differences in the supply and availability of services diminished and the quality of services improved. One of the measures undertaken in this period to improve access and continuity of care was the introduction of the “personal doctor” system in 1986 (the direct translation from the Finnish word would actually be “my own doctor”). Municipalities have had the freedom to choose whether to implement the new system. The traditional system is that appointments are made to any physician in the health centre who is available. In the personal doctor system, a person or a family is assigned to one health centre doctor, usually on the grounds of their place of residence, and physicians are paid a combination of a basic salary, capitation payment and fee-for-service payment for visits. Currently, approximately half the physicians working in health centres belong to the personal doctor system (see section 6.3). In the 1980s, the balance in mental health care started to shift more towards outpatient care and the number of beds in psychiatric hospitals gradually decreased, while resources to outpatient care increased. This trend continued in the 1990s, the number of beds in psychiatric hospitals reducing by 50% between 1990 and 2003. The previously high volume of psychiatric beds was brought to the average European level of about 1 bed per 1000 population. However, the supply of outpatient services did not grow sufficiently and outpatient resources diminished (Lehtinen et al. 2006), partly because of the economic recession in early 1990s (see section 6.9). Until 1991 general hospitals, psychiatric hospitals and former tuberculosis hospitals each had different organizational structures. In 1991, a new act on 24

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specialist level care and on hospital districts (Act on Specialized Medical Care) resulted in the creation of the current multi-purpose hospital districts, which are owned and operated by federations of municipalities. According to the new law every municipality is required to be a member of one of the hospital districts. During the late 1980s and 1990s, state regulation gradually decreased. From 1993 onwards, a package of changes in legislation, planning and financial incentives was introduced, which increased decentralization (Häkkinen 2005; Häkkinen and Lehto 2005). The main objective was to create economic incentives for municipalities to improve the efficiency of services. In a nutshell, the reforms brought about three major changes: redesign of the state subsidy system; relaxation of the rules on service provision; and decentralization of detailed planning. Firstly, the redesign of the state subsidy system meant that the old retrospective and earmarked payments for primary and specialist level care, which were guaranteed to be paid as long as the costs were for services approved in rolling five-year plans, were replaced by a new system in 1993. The new state subsidies are prospective and capitated needs-based (mainly sociodemographic) payments (see section 3.3.1.1). The new state subsidies are now paid to the municipalities instead of municipal service providers, such as health centres or hospitals. Secondly, related to this, in 1993 a new ruling in the law meant that municipalities were given the possibility of purchasing services from private providers. However, purchasing services from private providers was initially very rare since it was more economical to purchase specialist level services from the hospital district, partly because the municipality was in any case obliged to pay hospital district membership fees. Purchasing from private providers increased only in more recent years (see section 3.5.1). Thirdly, the reforms led to the decentralization of detailed planning of health services to the municipalities and to municipal federations (see section 4.1.2). In 1993, the state gave up its earlier regulatory power and concentrated on setting general policy objectives and also on what is known as “guidance by information”. Guidance by information encompasses policy recommendations based on research and evaluation, through the development of national statistics and registers and other performance indicators (see section 4.1.1). The main agency for the administrative regulation of health care (the National Board of Health) was dismantled. The dismantling of the National Board of Health was linked to a major reform in the state administration of social welfare and health at the beginning of the 1990s. The rationale was the simplification and streamlining of social and health administration, and the strengthening of social and health policy at 25

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the ministerial level. In 1991, the National Board of Health and the National Board of Social Welfare, which until then had both been important in guiding state administration, were amalgamated into one organization and soon thereafter abolished (in 1992). By this process, several new state agencies and institutions subordinated to the MSAH emerged (see section 2.2.2). They took over some of the tasks that had previously been the responsibility of the two national boards: the NAM was founded to supervise pharmaceutical products; the National Authority for Medico-legal Affairs (NAMLA) to assure the quality of health care services through supervision of health care professionals; and the National Research and Development Centre for Welfare and Health (STAKES) to conduct research and development to promote health and social care planning and development. The reforms in the Finnish health care system in the 1990s were accompanied by numerous cuts in resources and unforeseen redundancies among health personnel, due to the exceptionally severe economic recession. This was accompanied by a rapid expansion in the demand for medical services in hospitals (related to the reforms described above) and reductions in intake into medical and dental training some years earlier. One result of these changes was a significant shortage of health personnel during the late 1990s, especially among physicians and dentists. The situation was particularly severe in health centres in remote rural municipalities (see section 5.2.1). During the last 10 years the national economy has been steadily growing, but growth in health expenditure has been slower (see section 3.1). However, in general, the health care system seems to have survived the recession fairly well and no changes in health indicators that could be attributed to it have been observed. In 2001 the Government initiated “the National Project to Ensure the Future of Health Care” in order to achieve national consensus on the development of health services (see section 7.1.1.2). Concerns related to problems with access, waiting times and waiting lists, availability of human resources in the future and of heterogeneity of service practices and patterns were all addressed in this intense process. This process resulted in a deal being struck between the state and the municipalities and municipal health services: the Government promised a clear rise in the level of state subsidies to the municipalities; the municipal level, in turn, committed to a number of structural changes and to new standards in access to services. Another highly visible outcome of this process was a legislative change where specific time limits were put on waiting times (see section 7.1.1.3). This part of the reform was implemented in 2005. The main milestones in the history of the Finnish health care system are summarized in Table 2.1 and in appendix 10.2. 26

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Table 2.1

Finland

Milestones in the history of the Finnish health care system

Period 1940s

Event New act introducing GP to every municipality Establishment of maternity and child care Measures to treat and prevent tuberculosis (tuberculosis districts)

1950s

Development of the hospital system

1960s

Introduction of the NHI scheme Strong increase in the number of medical doctors to be trained

1970s

1972 Primary Health Care Act and establishment of health centres Introduction of the national planning system Developments in occupational health care

1980s

Health care and social services into the same national planning and financing system “Personal doctor” system introduced in health centres Beginning of deregulation and decentralization

1990s

Increasing deregulation and emphasis on municipal autonomy Reforms in the state administration of health care 1993 state subsidy reform Maintaining health care services during and after economic recession

2000s

National Project to Ensure the Future of Health Care Specific time limits for waiting times Project to restructure municipalities and services

Notes: GP: General practitioner; NHI: National Health Insurance.

2.2 Organizational overview In practice, in Finland there are three different health care systems which receive public funding: municipal health care funded by taxes, private health care partly funded by NHI and occupational health care partly funded by NHI (Fig. 2.1). The role of the state is to steer the health care system at a general level mainly by legislation and financing. The provision of private health care is rather weakly regulated by the state. 2.2.1 Municipalities Municipalities (i.e. the local authorities) have, by law, the main responsibility for ensuring basic services such as education (except university education) and social and health services are provided for their inhabitants (see section 3.2.1.1). Currently there are 415 municipalities (in 2008). The number of municipalities has decreased in the last five years from 448. The population of municipalities (outside of Åland Islands) currently varies from 250 inhabitants to 560 000 (the 27

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Fig. 2.1

Finland

Organizational chart of the statutory health system

Parliament

Government

Social insurance Institution Employers (occupational health care)

Ministry of Social Affairs and Health

Provincial State Offices

National Health Insurance

The Finnish Institute of Occupational Health Private providers

The National Authority for Medico-legal Affairs The National Agency for Medicines

Municipalities (Municipal health care)

Hospital districts (Specialist level health services)

Health centres (primary health services)

The National Public Health Institute The National Research and Development Centre for Welfare and Health Centre for Pharmacotherapy Development

Hierarchical relationship Regulation

smallest municipality, Velkua, will merge with neighbouring municipalities on 1 January 2009). The mean size is about 13 000 inhabitants and the median about 5 000 inhabitants. Municipalities have the right to levy income and real estate taxes. They also receive a subsidy from the state to enable them to organize the services they are obliged to provide. In addition to the state subsidy for health care, they receive state subsidies for social services and schooling. The state subsidy to municipal social welfare and health care expenditure is determined by the population, age structure and morbidity in the municipality plus a number of other computational factors. The subsidies constitute about 25% to 30% of municipal spending on health services. The main decision-making power in municipalities lies with the municipal council, which is elected every four years by the inhabitants of the municipality. The council appoints a municipal executive board, which is accountable to the council. The council also appoints members to the various municipal committees, according to the relative strength of political parties in the municipal council (every political party is granted the same proportion of the seats in a committee as it has in the council). The committees usually comprise those 28

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for health, social services, education, technical infrastructure and a number of others, and are appointed for four years. The municipal council, the municipal executive board and the committees are politically accountable to the inhabitants of the municipality. In addition, the municipal manager and a varying number of officials work in the administration of the municipalities. There are variations in detail and emphasis in the decision-making process in municipalities. The general trend has been towards delegating power from municipal councils to the various committees and leading officials. Decisions on the planning and organization of health care are made by the health committee, the municipal council and the municipal executive board. Here again there are variations. The leading persons of the municipal health centres are often also included in the planning and organization of health services. To improve the coordination of social and health services, the traditionally separate health boards and social welfare and services boards have been merged into a single board in most municipalities. In principle, the fact that social and health services are both organized and funded by the municipalities holds great potential for good coordination and integration of services, particularly for vulnerable groups (for example older people, people with mental health problems, and people with alcohol or drug abuse problems), but this potential has not always been fully exploited in practice. Primary health services provided by municipalities are defined in the Primary Health Care Act. The act states that every municipality must have a health centre which provides primary health services (see section 6.3). Municipalities can either provide these services independently or join with neighbouring municipalities in joint municipal boards which set up a joint health centre (a municipal federation-maintained health centre). There were 237 health centres in Finland (excluding Ă&#x2026;land Islands), of which 58 were joint health centres in 2007. In larger cities, the services of health centres are provided through several health stations located in different parts of the city (for example Helsinki has 29 health stations around the city). Municipalities can also purchase some primary health services from private providers or hospital districts. Health centres provide occupational health care services for those employers who choose to purchase these services from health centres. About 86% of health centres also had inpatient wards in 2003 (see section 2.1). In 2006 there were 24.9 million outpatient visits to health centres and 7.3 million care days in inpatient wards (STAKES 2007d). Of all visits, 36% were to physicians and the rest were to other professionals such as nurses, public health nurses, midwives, physiotherapists and psychologists. Of all outpatient visits, 9% were to maternity and child welfare clinics, 15% were home nursing visits and 5% to occupational health care. In oral health care there were 4.9 million visits of which 79% were visits to dentists. 29

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Specialized care funded by municipalities is mainly provided by hospitals maintained by the hospital districts and regulated by the Act on Specialized Medical Care. Currently, the Act divides the country into 20 hospital districts (excluding Åland Islands). Each municipality must be a member of one hospital district (the number of member municipalities varies from 6 to 58). The hospital districts organize and provide specialist medical services for the population of their member municipalities. The hospital districts are federations of municipalities. These federations are separate from federations maintaining health centres. However, recently there have been local reforms to integrate these two organizations (see section 7.1.2.2). Each hospital district has a central hospital, five of which are university-level teaching hospitals. Hospital districts are managed and funded by the member municipalities. The catchment population of hospital districts varies from 65 000 to 1.4 million inhabitants. A referral from a licensed physician is needed for access to medical care provided at the hospital districts. Life-threatening emergencies are of course exempt from this requirement. The referring physician does not have to work in the municipal health centre and can be, for example, a private physician. Supreme decision-making power in hospital districts is exercised by the hospital district council, whose term of office is the period between municipal elections, i.e. four years. Each municipality has one to six seats in the council depending on the size of their population. Each municipality’s share of votes is the same as its share of total population within the district (but it cannot be more than one fifth of all votes). Practical administration is directed by the executive board elected by the council. Usually members of both the council and the executive board are local politicians and the composition of representatives of political parties reflects the support received by the political parties in municipal elections. The council adopts the annual budget, approves financial statements and makes decisions on major investments. The emphasis of the executive board is on strategic goals, coordination of activities, employer duties and administrative steering. The council meets twice a year, while the board generally meets monthly. The executive management consists of two to six permanently appointed officials (for example, the hospital district director, a medical director and a nursing director). There are different contractual or negotiation mechanisms between hospital districts and municipalities for agreeing on target volumes and payments which comprise elements of purchaser and provider separation, although ultimately the relationship is hierarchical and municipalities cover any deficits and retain any savings in their accounts (see section 3.4.1). 30

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2.2.2 National level The Government decides on general national strategies and priorities and proposes bills to be discussed by Parliament. Health care policy is primarily the field of the MSAH. The MSAH directs and guides the development and policies of social protection, social welfare and health care. It defines the main course of social and health policy, prepares legislation and key reforms and steers their implementation, and handles the necessary links with the political decision-making process. The general aims of social welfare and health care and the measures that will be taken in order to fulfil these aims are adopted in the National Development Programme for Social and Welfare (previously Target and Action Plan for Social Welfare and Health Care) that is drawn up for the whole period of office of each Government, normally for four years. The ministry’s work is led by two ministers: the Minister of Social Affairs and Health and the Minister of Health and Social Services. The ministry is divided into six departments: the Administrative Department, the Insurance Department, the Department for Family and Social Affairs, the Health Department, the Finance and Planning Department and the Department for Occupational Health & Safety. The Health Department is responsible for the development and steering of health promotion and disease prevention, health care services at all levels, occupational health services, pharmaceutical policies (except pricing) and environmental health, as well as for the drafting of legislation and budgeting regarding these areas. The Insurance Department is responsible for NHI among other things. The Pharmaceutical Pricing Board (PPB), which approves reasonable prices and the reimbursement status of pharmaceuticals, is also in this department. Decision-making is based on the applications of pharmaceutical companies (see section 6.6). Given the scope and volume of policies and programme, legislation and budgeting handled by the MSAH, its staff is relatively small. The Health Department, for instance, contains little over 70 staff. This is explained by the fact that the ministry relies on the extensive use of a well-functioning system of expert organizations and advisory bodies. The agencies and institutions subordinate to the MSAH are responsible for various issues related to social welfare and health care in Finland: • The STAKES (about 500 employees) monitors and evaluates activities in social welfare and health care services, and carries out research and development work in these fields. • The NAMLA (about 70 employees) guides and supervises the provision of health services in Finland. It also undertakes activities related to 31

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the registration of health care professionals, forensic psychiatry and licensing. • The NAM (about 200 employees) maintains and promotes the safe use of medicines, medical devices and blood products. It grants permissions for the sales of pharmaceutical products and assesses the quality and other documentation related to market authorization of medical products. It also supervises the manufacture, import and distribution of medicines and disseminates information on pharmaceuticals (see section 6.6). • The National Public Health Institute (KTL) (about 900 employees) carries out research on diseases and their prevention, collects data on communicable diseases, health behaviour and the effects of health promotion, and ensures the availability of vaccines in the country. • The Radiation and Nuclear Safety Authority (about 340 employees) sets the regulations for the use of radiation and nuclear energy and supervises implementation of the regulations. It is also an expert institute that carries out research on radiation and its effects, determines risks caused by radiation and monitors the radiation safety of the Finnish environment. • The National Product Control Agency for Welfare and Health (about 90 employees) handles the administration of licensing connected with the import, manufacture and sales of alcoholic beverages and tobacco products. It is also responsible for reports and other tasks as required by the Chemicals and Pesticides Act. • The Finnish Institute of Occupational Health (FIOH) (about 800 employees) carries out research, offers training for occupational health and safety professionals, provides advisory services and disseminates information on occupational health. • The Centre for Pharmacotherapy Development (Rohto) (about 10 employees) promotes rational drug use by gathering and distributing information on pharmacotherapy and promoting its use in clinical practice. This agency is still relatively small, having been founded only in 2003. The state has two psychiatric hospitals (mainly for forensic psychiatry). They are managed through STAKES. In addition the state operates special hospitals for military forces and prisoners. The Ministry of Employment and the Economy is also quite active in the field of health care, mainly from a commercial and business promotion perspective. For example, it governs the National Technology Agency of Finland (TEKES) which runs the Healthcare Technology Programme (see section 4.2.3), FinnWell (2004–2009). The programme has the objective of improving the quality and profitability of health care related industries, and promoting business activities and export (the value of the programme is 150 million euros). The ministry 32

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also governs the Finnish Competition Authority whose objective it is to protect sound and effective economic competition and to increase economic efficiency in both private and public-sector activity. The Ministry of Education is responsible for planning and subsidizing the education and training of health personnel as well as research. There is a further administrative level between the state and municipalities, the province. Since 1997 there have been five provinces (excluding the Ă&#x2026;land Islands) in the country. The provincial administration is part of the state administration and promotes national and regional objectives. Each province has its own provincial state office with several departments, including a social and health department. The social and health departments are responsible for guiding and supervising both public and private health care as well as assessing basic services in municipalities. Their responsibilities also include the handling of appeals relating to health service provision. They also support and participate in various training and development activities in their respective provinces. Finland has eight Occupational Health and Safety Inspectorates. These are supervisory authorities within the state regional administration with responsibility for creating the necessary prerequisites for healthy and safe working conditions that promote working capacity. The Inspectorates report on related development needs to the Department for Occupational Health and Safety within the MSAH. The organizational structures of state governance in health and social services at a central and provincial level, including the research and development institutions, are currently under review. The Government is expected to decide on proposals during 2008. 2.2.3 National Health Insurance and the private sector The statutory NHI scheme finances 17% of the total costs of health care. The scheme is run by the SII, with about 260 local offices all over the country. SII falls under the authority of the Parliament. NHI covers all Finnish residents and it includes outpatient drug reimbursement, reimbursement of medical costs in the private sector, compensation of travel costs to health care units, sickness allowance, maternity leave allowance and compensation for some rehabilitation services (for co-payments see sections 3.3.3.2 and 3.3.3.3). In addition, NHI reimburses part of the costs of occupational health care. NHI is funded by employers (33% in 2006), the insured (38%) and the state (28%). The insured pay income-based insurance fees which are collected in connection with taxation (between 1.91% and 2.08% in 2008). 33

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The Private Health Care Act regulates the provision of private health services. The NHI scheme covers part of private health care costs (about one third, depending on the type of care). Private service providers can price services freely, but reimbursements are fixed (see sections 3.2.2.3 and 3.3.3.2). In terms of number of units, the most common private health care providers in Finland are physiotherapy units made up of 2–3 workers (about 1500 units in 2005) and medical doctors’ practices (about 1100). The largest provider units, a few hospitals and occupational health care units have several hundred employees. In 2006 there were 16 000 working age physicians in Finland, of which 1700 worked full-time as private physicians and 30% were employed in the public sector but held a private practice outside their regular working hours for an average of four hours per week (“dual practice”) (Suomen Lääkäriliitto 2006). Private health care in Finland mainly comprises ambulatory care, available mostly in the large cities. In 2006 there were 3.5 million outpatient visits to private doctors (compensated by NHI), of which 79% were visits to specialists (SII 2007a). In terms of the number of outpatient visits, the most important fields of specialty in private health care were gynaecology and ophthalmology (together comprising more than one third of visits to specialists). Private services funded by NHI comprised about 16% of total outpatient GP and specialist visits in 2005 (see Table 1.1). Private hospitals produced 71 700 inpatient care periods in 2005 which comprised about 5% of all inpatient care periods in Finland (STAKES 2006b; STAKES 2007b). About 36% of private sector outpatient visits are provided in the region surrounding the capital (SII 2007a). Nongovernmental organizations (NGOs) and foundations are active in the health care sector. These organizations provide a very broad spectrum of services. Municipalities and hospital districts can purchase services from these providers. These organizations can receive subsidies from the Finnish Slot Machine Association (which has a monopoly on gambling in Finland and is governed by the state) for providing health care services (see section 2.2.5). There is also a special foundation (Finnish Student Health Service) which provides ambulatory health care to university students. This organization is partly funded by the NHI scheme. 2.2.4 Occupational health care The Occupational Health Care Act enacted in 1979 obliges employers to provide occupational health care for their employees. The Act defines compulsory occupational health care as those health services that are necessary to prevent health risks caused by work (for details of entitlements see section 3.2.2.4). NHI reimburses employers 50% of the necessary and appropriate costs of 34

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occupational health care (maximum reimbursement is about 60 euros per employee per year for compulsory services and about 90 euros for voluntary services). Employers and employees participate in financing the scheme through their NHI payments. In 2004, about 84% of all employees in Finland were offered occupational health care by their employers (SII 2007b). Some small employers did not organize health care services for employees or did not apply for reimbursement from NHI (Kauppinen et al. 2007). About 13% of outpatient visits to physicians are provided by occupational health care (see Table 1.1). In 2004, employers purchased or provided 409 million euros worth of occupational health services and were subsidized 177 million euros (43%) for this from NHI (SII 2007b). Employers can supplement compulsory occupational health care by voluntarily organizing further medical services. Employers are free to decide the scope of these voluntary services. About 90% of employees receiving compulsory occupational health care also received voluntary services. Employees are not charged for using these services (but limits to services available are set by the employer). Sixty-one per cent of employers’ total expenditure was for voluntary services (these figures only include expenses which employers declared to NHI). Occupational health services can be provided by the employer itself, jointly with other employers or the employer can purchase them from another employer (in total accounting for 42% of occupational health expenses in 2004), or the employer can purchase services from municipal health centres (16% of expenses), from private health care providers (29% of expenses) or from other sources (12% of expenses). Because of the occupational health care system, the majority of the working population effectively has “double” coverage for primary care (i.e. care in both municipal health centres and occupational health services). Also, since private primary care is subsidized by the state, some have “triple” coverage. 2.2.5 Other organizations Pharmacies are privately owned by pharmacists (see section 6.6). There were 804 private pharmacies in Finland in 2006 including subsidiary pharmacies (NAM 2007). In addition to this, the University of Helsinki and the University of Kuopio have a special right to own pharmacies (in total 18 pharmacies). The Finnish Slot Machine Association has become quite an important financier of non-profit voluntary organizations in the health and social welfare sector. Annually, it gives around 300 million euros to support NGO work promoting health and social well-being. The association is governed by the state 35

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together with major NGOs related to social welfare and health. It operates slot machines, amusement machines and casino games in which it has a monopoly imposed by the state. A government decree regulates the administrative structure of the association and an act regulates the distribution of funds. The final decision on funding is made by the Government. The objective of the funding activities is to promote the health and social welfare of people in Finland. Groups targeted include, for example, older and disabled people, young families, people with chronic diseases and substance abusers. The association only supports third-sector organizations; it does not finance any municipal health services or private profit-making providers. Finland has a large number of patient organizations. It is estimated that there are about 130–150 national patient organizations with budgets up to 58 million euros. The main functions of these organizations are information dissemination, supporting patients, lobbying, producing services and supporting research. One major source of their funding is the Finnish Slot Machine Association. Other important public funding sources are the MSAH, the SSI and municipalities. All health care professionals have their own trade unions, for example the Finnish Medical Association for physicians, the Finnish Dental Association for dentists, the Finnish Pharmacists’ Association for professionals in the field of pharmacy, and the Union of Health and Social Care Professionals for nurses, midwives, dental assistants, medical laboratory technicians, radiographers, mental health nurses, emergency medical technicians and ambulance staff. In addition to trade unions there are many other active professional organizations. Perhaps the most important of these is a medical scientific organization, the Finnish Medical Society, Duodecim, which produces national Current Care Guidelines (see section 7.1.1.6), organizes consensus meetings about important topics in health care, maintains a comprehensive Evidence-based medicine (EBM) database, maintains widely used Internet health portals (Terveysportti for health care professionals and Terveyskirjasto for the public), and publishes handbooks for health care professionals in Finnish.

2.3 Decentralization and centralization Since the reforms of 1993, the Finnish health care system has been very decentralized. It has been argued that public responsibility for health care is decentralized in Finland more than in any other country (Häkkinen and Lehto 2005). As described in section 2.2.1, 415 municipalities are responsible for organizing and funding health services for their inhabitants. State level 36

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regulations and steering in health care service provision are not very detailed. Municipalities can set their own municipal income tax rates, and decide how much they invest in health care and how they organize services. Notwithstanding some discordant views, decentralization is widely accepted in Finland. The population is dispersed and local decision-making has always been regarded as important. One consequence of decentralization is wide differences in per capita expenditure on health care between municipalities (Hujanen, Pekurinen, Häkkinen 2006). These can only partly be explained by differences in determinants of need. Another consequence is variations in clinical practice and in the delivery of health services between municipalities and between hospital districts. For example, the number of inpatient cases and surgical procedures per capita vary markedly from region to region in the treatment of ischaemic heart disease (Häkkinen et al. 2002) and in orthopaedic operations (Mikkola et al. 2005). Significant variations in outpatient care are also observed (Häkkinen and Alha 2006). The differences can only partly be explained by different levels of morbidity or age and sex structure in the population. Recently this decentralization process has reversed slightly, as the state has become increasingly concerned about geographical inequalities in health. For example, in 2005 the MSAH enacted nationwide guidelines for access to treatment in non-urgent specialized care, based on a change in legislation (see section 7.1.1.3). The reform has significantly reduced waiting times, but there is as yet no formal evaluation on how the guidelines are being followed nationwide. Another potential mechanism for counteracting the negative consequences of decentralization is reconfiguring municipalities. More than 75% of municipalities have fewer than 10 000 inhabitants and 20% have fewer than 2000 and, as such, many could be considered too small for organizing and funding health services. The smallest municipal health centres are experiencing increasing difficulties with securing sufficient skills for providing services. Although hospital districts have a special funding pool between member municipalities to cover exceptionally high individual patient expenses (typically above 50 000 euros per individual patient or episode), the economic risks of hospital care expenses for a small municipality are commonly acknowledged. However, there has been no consensus on how to eliminate or lower this risk. Currently, a political debate is being prepared to address the issue of shifting to larger units either by reducing the number of municipalities or through creating new regional structures that would be responsible for the funding and provision of all health care services (see sections 7.1.2.1, 7.1.2.2 and 7.2.1). 37

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2.4 Patient empowerment 2.4.1 Patient rights An act on patients’ status and rights, the first such law in Europe, came into force in 1993 (the Act on the Status and Rights of Patients). It applies to every part of the health care system and to health care services provided in social welfare institutions. This act mainly concerns the patients’ right to information, informed consent to treatment, the right to see any relevant medical documents, right to complain and the right to autonomy. Specifically, the Act rules that: • treatment requires the consent of the patient; • patients must, if they so request, be given information on their state of health, the extent of the proposed treatment, any risk factors and possible alternative forms of treatment; • patients are entitled to see and correct the information entered in their own patient records; • those on a waiting list for treatment must be told the reason for the delay and its estimated duration; • patients dissatisfied with their treatment are entitled to lodge a complaint with the organization concerned; • organizations providing medical treatment must have a salaried patient ombudsman, whose duty is to inform patients of their rights and assist them, if necessary, in submitting a complaint, appeal or claim for indemnity; • the opinion of young patients (under the age of 18) must be taken into account if they have reached a stage of development at which they are able to express an opinion. A medical doctor or other professional person assesses the stage of development; • a child’s parent or guardian is not entitled to refuse treatment that would avert a health risk or save the life of an under-age person; and • the patient has the right to refuse treatment (except some exceptional cases). 2.4.2 Patient choice In theory, the population has the possibility of choosing between the three health care systems: municipal health care, private health care and occupational health care. However, in private health care substantial user-fees can be a barrier to access and occupational health care is available only to employed people. Furthermore, even if employers do organize health care for their employees, 38

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curative services might not be included (see section 2.2.4). Therefore, in practice, for poor unemployed people the municipal health care system is the only option. In the municipal health care system, patients have very limited freedom to choose between health care providers or physicians. The patient is treated only in the health centre of his/her own municipality, except in acute cases if the health centre of the home municipality is too far away. In some municipalities patients are permitted to choose a physician in the health centre. A referral from a licensed physician is needed for access to municipal specialist level medical care (i.e. hospital districts), where patients cannot usually choose the hospital or the physician. Patients may be offered the choice of going to a neighbouring hospital district to access health care if there are long queues in their own hospital district, although in many cases patients have been found to be unwilling to do this. On the contrary, under the NHI scheme patients can choose any private provider they like, but patients are only partly subsidized. In occupational health care, the provider is chosen by the employer. For treatment of injuries resulting from motor accidents under the motor liability insurance scheme and under the occupation accident insurance scheme, the provider is usually chosen by the insurance company. 2.4.3 Information for patients The most comprehensive source of patient information is the Internet. The majority of municipalities have web pages where patients can find information on the health care system in their municipality. Hospital districts also have their own web pages. State level administration has a portal named “suomi” where there is information on public sector services (see 10.3). These web pages contain, for example, information on services, contact information and information on decision-making. Since 2005, public sector health care providers have been expected to provide information on waiting times on their web pages. However, only half the providers have implemented this. Other quality indicators are not available for patients. Private providers have their own web pages containing information on their services, but there is no central information source relating to private health services in Finland. There are also many information sources on health in the Finnish language online. In 2006, the Finnish Medical Society, Duodecim, built an Internet portal “Terveyskirjasto” (“Health Library”) (see 10.3), containing thousands of patientcentred articles concerning diseases and treatments. Many municipalities and hospital districts have linked this portal to their own web pages. Additionally, 39

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many patient organizations have this type of information on their web pages and also distribute printed material. Direct-to-consumer advertising of prescription pharmaceuticals is forbidden in Finland, but pharmaceutical companies circumvent this ban by hosting disease centred portals targeted at patients. 2.4.4 Complaint procedures There are several mechanisms in place for patients to complain about health care services: • The first step is to make a complaint to the provider possibly assisted by a patient ombudsman (see section 2.4.1). • If the first step does not satisfy the patient, he or she can make a complaint to the provincial administration, which can, in severe cases, forward the complaint to the NAMLA. • In addition, patients can appeal to administrative courts if they think that they have not received necessary care in public sector health care services. • There is also a parliamentary ombudsman in Finland to whom people can make complaints about public authorities, including public health services. In Finland, the annual number of complaints relating to health care is approximately 800–900, most of which are dealt with by provincial offices. During recent years the number of complaints has increased. Complaints where treatment has led to death or severe injury of the patient are normally dealt with by the NAMLA, whereas other complaints are typically dealt with by provincial offices. If necessary, the NAMLA may undertake administrative supervision, precautionary measures, or disciplinary proceedings as a result of a complaint. Administrative supervision can involve instructing a health care professional to pay attention to the inadequacies or inappropriateness of performance evident in his or her professional practice or a health care professional may be given a warning. In the most severe cases, the NAMLA can limit or remove the right of a professional to practise his or her profession. In addition to professionals, the NAMLA can also instruct or warn provider organizations. 2.4.5 Patient safety and compensation The MSAH launched a project to enhance patient safety in 2005, prompted by the World Health Organization (WHO) World Alliance for Patient Safety programme. The project collects and disseminates information on good practices and coordinates the promotion of patient safety in Finland. It has produced guidelines, for example, on safety in drug therapy. The project has also involved 40

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the development of processes to aid health care provider units to respond to hazardous situations which have occurred in the unit. Several agencies are also involved in patient safety, for example the NAMLA (see section 2.4.4) and the NAM (see section 2.2.2). There are two insurance systems related to patient safety. According to the 1987 Patient’s Injury Act, amended in 1999, the patient has the right to compensation for unforeseeable injuries resulting from treatment or diagnosis. Notable in this act is the fact that health care personnel need not be shown to be legally responsible for the injury. To receive compensation, it is sufficient that an unforeseeable injury as defined by the act has occurred. According to the act, all health care providers must have this liability insurance. In 2005, patients received compensation in about 2300 cases (22.7 million euros). The most common treatments leading to a complaint were hip and knee endoprosthesis and some orthopaedic operations. In addition, hysterectomy, gall bladder and tooth removal operations were among the 10 most common operations leading to a complaint. Applications for compensation are handled by the Finnish Patient Insurance Centre. Medicines-Related Injuries Insurance indemnifies unexpected adverse effects caused to patients by pharmaceuticals distributed for consumption in Finland. The insurance also covers adverse effects caused by pharmaceuticals in clinical trials. This is voluntary insurance which is taken by the Finnish Pharmaceutical Insurance Pool representing pharmaceutical companies operating in Finland. In 2006 there were 227 claims of which 56% were qualified for compensation. 2.4.6 Patients’ participation Citizens can influence decision-making in the health care system through the right to vote every four years in both municipal and parliamentary elections. The most important channel for the public to participate in decision-making is through municipal councils and municipal health committees which represent the populations of municipalities. Hospital districts also have councils and executive boards, which are politically elected by municipal councils (see section 2.2.1). There are also various patients’ associations which lobby decision-makers on issues concerning the planning and management of health care locally, regionally and nationally (see section 2.2.5). In addition to this, many service provider units collect the opinions and experience of service users.

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2.4.7 Patients and cross-border care Due to language and geographical barriers, cross-border health care is insignificant in Finland (except for tourists needing unforeseen care). Statistics on this are scarce, both in terms of people living in Finland seeking care abroad and foreigners seeking care from Finland. Finnish residents are entitled to publicly financed unforeseen medical care in other EU/European Economic Area (EEA) Member States if they are entitled to NHI (see section 3.2.1.2). To receive publicly financed planned treatment in another EU/EEA Member State, the patient needs authorization (E112 form) from his/her hospital district or health centre (annually about 10–20 patients in Finland). The SII handles claims for medical expenses between Finland and other EU/EEA Member States. In 2006, SII reimbursed these claims to other countries at a sum of 3.7 million euros and received claims from other countries of 10.2 million euros. However, these figures do not include Nordic countries, the United Kingdom, Belgium, the Netherlands, Luxembourg and Austria since Finland has agreements with them on a full or partial waiver of reimbursements of medical expenses. Patients can also claim normal NHI reimbursement (see section 3.2.2.3) for costs of unforeseen medical care when staying temporarily in countries other than EU/EEA Member States. However, as the reimbursement is rather low, people normally opt for private insurance to cover these expenses.

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3. Financing

inland has two sources of public financing for health services (dual financing): municipal financing based on taxes and NHI based on compulsory insurance fees (Fig. 3.1). Municipalities fund municipal health care services (except outpatient drugs and transport costs). NHI funds private health care, occupational health care, outpatient drugs, transport costs and sickness allowance. Dual public financing creates some challenges for overall efficiency of service production which are described in section 8.3. Municipalities have the responsibility for organizing health services for their residents. For this, municipalities raise funding from municipal taxes, from state subsidies and from user-fees (Fig. 3.1 and Table 3.1). The main source of municipal funding for health care services is taxation. The majority of municipal health services are provided by municipal-owned health centres and hospital districts, but municipalities and hospital districts may also purchase services from the private sector (see section 2.2.1). There is no true purchaserâ&#x20AC;&#x201C;provider split in the municipal health care system, as municipalities both fund services and own the service provision organizations, although there are exceptions to this (see section 3.4.1). NHI is divided into two parts: sickness insurance and income insurance. Sickness insurance covers outpatient drug reimbursement (see section 6.6), reimbursement of medical costs for use by the private sector and rehabilitation services, and compensation of travel costs to health care units (including ambulance services). Income insurance covers sickness allowance, maternity leave allowance, rehabilitation allowance and reimbursement for employers for occupational health care services (see section 2.2.4). Sickness insurance is funded by employees and the state. Income insurance is funded by employees and employers (see section 3.3.1.2).

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Fig. 3.1

Finland

Financial flow chart Health insurance fee (employers and insured) Governmental agencies under MOH

The State Government/MSAH

Hospitals for military forces and prisoners

State subsidy

Municipal tax

State tax

Tax funding

SII

Municipalities (415)

Private providers

Employers occupational health care

Hospital districts (20) Health centres (237) Municipal hospitals or inpatient wards

Statutory accident insurance, Motor accident insurance and voluntary health insurances

Patients

Pharmacies (804)

Notes: MSAH: Ministry of Social Affairs and Health; SII: Social Insurance Institution. Table 3.1

Trends in health care expenditure

1980 1985 1990 1995 2000 2002 2004 2005 Total expenditure on health (TEH) TEH at 2005 prices (million euro) 7 515 9 094 10 815 9 354 10 052 11 058 11 547 11 854 TEH per capita USD PPP – – 1 419 1 430 1 716 2 012 2 235 2 331 TEH as a % of GDP 6.4 7.2 7.8 7.4 6.7 7.2 7.5 7.5 Public expenditure as % of TEH State Municipalities NHI

80 38 29 12

79 34 35 10

81 36 35 11

76 28 34 13

75 18 41 15

76 18 42 16

77 20 40 17

78 21 40 17

Private expenditure as % of TEH Households Private insurance Employers and relief funds

20 18 1 2

21 18 1 2

19 16 2 2

24 21 2 2

25 20 2 2

24 20 2 3

23 19 2 3

22 18 2 3

Sources: STAKES, 2007a. Notes: TEH: Total expenditure on health; PPP: Purchasing power parity; GDP: Gross domestic product; NHI: National Health Insurance. 44

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3.1 Health expenditure Health care expenditure in Finland developed in parallel with most other EU countries until 1990, rising steadily both in absolute terms and as a share of GDP (statistics used here include mental health care, dental care and public health expenses but exclude social care and long-term care). However, after 1990 health expenditure started following a different trend (Table 3.1), mainly because of the steep economic recession in the early 1990s (Häkkinen 2005). Total health expenditure in real terms dropped between the years 1991 and 1994 but increased after that returning to the 1991 level only after 10 years in 2001. Between the years 2001 and 2005 it has further increased by 12%. The out-of-pocket share of expenditure on health increased between the years 1991 and 1994 due to the abolition of the tax deduction for medical expenses and an increase in user-charges (Häkkinen 2005). During the 1990s, the amount allocated to state subsidies also fell, decreasing the state’s share of expenditure. At the beginning of the economic recession in 1990–1991, GDP declined markedly but health expenditure did not initially decrease at the same pace, meaning that, momentarily, the proportion of GDP spent on health care was one of the highest in the European Region at that time (9% of GDP). However, the proportion decreased sharply after that, reaching its lowest point in 2000 at 6.6%. Since then, the proportion has increased again reaching 7.5% in 2005. In 2003, Finland’s expenditure on health as a percentage of GDP placed it at the bottom of the EU15 country ranking, ahead only of Luxembourg in 2003 (Fig. 3.2). Figure 3.3 shows how the economic recession affected health care expenditure as a share of GDP in Finland, compared to other Nordic countries where the share of GDP steadily increased during the 1990s. In 2003, health care expenditure in Finland in US$ PPP per capita was about 9% below the EU15 average (Fig. 3.4), and was below that of other tax-financed countries such as Italy, Sweden, Norway and the United Kingdom. One of the possible explanations for the low total health care expenditure in Finland is the low salary of health care professionals, especially that of nurses (see section 3.5.2.2). Health care expenditure from public sources as a percentage of total health care expenditure was also lower in Finland than in these and other Nordic countries (78% in 2005 when it was 85% in Sweden, 84% in Norway and 84% in Denmark) (Fig. 3.5). From public expenditure, 4% was spent on private health care and occupational health care. Total health expenditure in Finland was 11.9 billion euros in 2005, the equivalent of 2255 euros per capita (STAKES 2007a). Table 3.2 shows that in Finland 36% of health care expenditure was spent on inpatient care and 31% on 45

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Fig. 3.2

Finland

Total expenditure on health as a percentage of GDP in Finland and selected other countries 2003 Western Europe 11.6 10.9 10.8 10.0 9.9 9.9 9.8 9.8 9.8 9.5 9.3 9.2 9.0 8.7 8.7 8.1 7.8 7.8 7.7 7.5 7.5 7.2 7.1 6.9 6.2

Switzerland Germany Iceland France Norway Monaco Portugal Netherlands Greece Sweden Belgium Malta Denmark Italy Israel United Kingdom Spain San Marino Turkey Finland Austria Ireland Andorra Luxembourg Cyprus Central and south-eastern Europe Bosnia and Herzegovina Slovenia Hungary Croatia Bulgaria Czech Republic The former Yugoslav Republic of Macedonia Albania Lithuania Poland Latvia Slovakia Romania Estonia CIS Republic of Moldova Belarus Ukraine Armenia Uzbekistan Kyrgyzstan Russian Federation Tajikistan Georgia Kazakhstan Turkmenistan Azerbaijan Averages EU Member States before May 2004 EU average CIS average

9.3 8.7 8.4 7.9 7.7 7.2 7.0 6.6 6.5 6.4 6.4 5.8 5.7 5.5 7.5 6.3 5.8 5.6 5.4 5.4 5.3 4.5 4.0 3.9 3.8 3.7 9.3 8.7 5.3 0

10 % of GDP

Source: WHO Regional Office for Europe, January 2007. Notes: GDP: Gross domestic product; CIS: Commonwealth of Independent States. 46

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Fig. 3.3

Finland

Trends in health care expenditure as a share of GDP(%) in Finland and selected other countries

12 11 10 9 8 7 6 5 4 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Denmark Sweden

Finland United Kingdom

Germany EU average

Norway

Source: WHO Regional Office for Europe, January 2007.

outpatient care (excluding dental care) in 2005. Expenditure on pharmaceuticals has grown rapidly, both in real terms and as a share of total expenditure, despite many measures taken to contain costs (see section 7.1.1.4). Pharmaceutical expenditure has increased mainly because of the increasing prices of new pharmaceuticals and the increasing use of pharmaceuticals in general. In 2006 total sales (including inpatient and outpatient use) were 2.4 billion euros, about 470 euros per inhabitant (NAM 2007). In 2005 sales of pharmaceuticals accounted for 20.5% of total health care expenditure, compared to 15.4% in 1994. Part of this increase is explained by the fact that during the economic recession municipal health care spending was reduced, but the NHI was unable to exercise similar control on provider expenditure. Municipalities spent, on average, about 1300 euros per inhabitant on health care in 2005. Health care accounted for, on average, about 25% of the municipal budget. However, the distribution of expenditure levels is broad, with striking variation across municipalities. Part of the variation is due to structural differences, for example there is variance between municipalities on the proportion of expenditure on long-term elderly care which is included in the health care expenditure figure (some municipalities arrange a substantial part of long-term elderly care in inpatient wards of health centres). However, even after reducing this effect (by combining expenditure on long-term elderly care and health care) expenditure varied from 940 to 2310 euros per inhabitant in 2004. After adjusting this expenditure for need, expenditure was still 2.5 47

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Fig. 3.4

Finland

Health care expenditure in US$ PPP per capita in the WHO European Region, 2003 Western Europe

Monaco Luxembourg Switzerland Norway Iceland San Marino Netherlands Germany France Belgium Sweden Denmark Ireland Andorra United Kingdom Italy Austria Finland Greece Israel Spain Portugal Malta Cyprus Turkey Central and south-eastern Europe Slovenia Hungary Czech Republic Croatia Slovakia Lithuania Poland Estonia Latvia Bulgaria Romania The former Yugoslav Republic of Macedonia Albania Bosnia and Herzegovina CIS Belarus Russian Federation Kazakhstan Ukraine Armenia Turkmenistan Republic of Moldova Georgia Kyrgyzstan Uzbekistan Azerbaijan Tajikistan Averages EU Member States before May 2004 EU average CIS average

4 797 3 992 3 954 3 862 3 508 3 172 3 056 3 052 3 016 2 922 2 875 2 838 2 619 2 581 2 531 2 424 2 365 2 275 2 106 1 972 1 908 1 903 1 686 972 589 1 760 1 334 1 333 897 829 816 810 776 751 635 566 411 409 359 740 571 393 361

321 224 202 193 177 169 160 82

2 645 2 268 444 0

1 000

2 000

3 000

4 000

US$ PPP

Source: WHO Regional Office for Europe, 2007. Notes: PPP: Purchasing power parity; CIS: Commonwealth of Independent States. 48

5 000

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Fig. 3.5

Finland

Health care expenditure from public sources as a percentage of total health care expenditure in countries in the WHO European Region, 2003

Luxembourg Czech Republic United Kingdom Sweden Norway Denmark Croatia Ireland France Finland Germany Malta Estonia Austria Slovenia Italy Lithuania Slovakia Turkey Portugal Hungary Belgium The former Yugoslav Republic of Macedonia Spain Poland Romania Netherlands Switzerland Bulgaria Latvia Greece Cyprus Averages EU 15 EU average CIS average

90.4 89.2 86.3 84.9 83.5 82.3 81.0 79.5 78.4 77.2 76.9 76.1 76.0 75.6 75.6 75.1 75.0 73.8 72.3 71.6 71.6 71.1 71.0 70.9 68.6 66.1 62.4 58.5 57.6 56.6 52.8 44.3 76.3 75.0 56.3 0

50 Percentage

100

Source: WHO Regional Office for Europe, 2007. Notes: CIS: Commonwealth of Independent States; EU: European Union; EU15: EU Member States before May 2004.

times higher in the most costly municipality when compared to least costly one (Hujanen, Pekurinen, Häkkinen 2006). The total expenditure of NHI was 3.5 billion euros in 2005 (SII 2006). Under Motor Liability Insurance bodily injuries were compensated for a total of 191 million euros in 2004 and under Statutory Accident Insurance injuries were compensated for a total of 593 million euros.

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Table 3.2

Finland

Health care expenditure by service category, (%) of total expenditure on health care, 2005

Inpatient care Outpatient care Dental care

Million euro 4 286 3 712 606

% 36.2% 31.3% 5.1%

Pharmaceuticals (outpatient care) Medical devices Environmental health Administration Public investments Transportation

1 930 389 129 228 387 187

16.3% 3.3% 1.1% 1.9% 3.3% 1.6%

Total health care expenditure

11 854

100%

Source: STAKES, 2007a.

3.2 Population coverage and basis of entitlement 3.2.1 Population coverage Every Finnish resident has the right to health services regardless of ability to pay or place of residence. The constitution states that public authorities shall guarantee for everyone, as provided in more detail by an act of the Parliament, adequate social, health and medical services and promotion of the health of the population. Asylum seekers, illegal immigrants, tourists, temporary students and workers (from non-EU countries) are not covered by municipal health care or NHI. However, municipal health care units provide essential emergency care to everyone. According to a specific act (Act on Adaptation of Immigrants and Reception of Asylum Seekers), asylum seekers are entitled to the same health services as permanent residents. These services must be organized by reception centres for refugees. 3.2.1.1 Municipal health care Municipal health care covers all people registered as permanent residents of the municipality. This also applies to migrants intending to live in Finland permanently who have a residence permit for at least one year (if required) (Act on Municipality of Residence). People who have lived outside of Finland for more than one year do not have an official municipality of residence. Asylum seekers without a residence permit, illegal immigrants and foreign temporary workers are not covered by the municipal health care system. Persons from other EU countries are entitled to the same services as Finnish residents (with 50

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some restrictions), but their care is paid for by their home country. However, essential emergency care is provided to all. 3.2.1.2 National Health Insurance NHI covers all permanent residents of Finland. NHI is compulsory and insurance fees are collected with taxation. Permanent residents in Finland receive an SII card which proves eligibility for social security (including health insurance) in Finland. The meaning of residency is defined by the Sickness Insurance Act. In order to be recognized as living in Finland, a person must have primary residence in Finland and must continually spend most of their time in Finland. People are considered to be living in Finland and eligible for benefits during a temporary stay abroad of one year or less. Immigrants are considered to be residents if they intend to live in Finland on a permanent basis and have a residence permit for one year (if required). Whether residence is considered to be permanent is determined by reference to the purpose of entry to Finland. The move is considered to be permanent if the immigrant is a refugee or full-time student, or if the immigrant comes to Finland for family reasons or has either a permanent work contract or a work contract for at least two years. Persons seeking asylum in Finland are not considered to be living in Finland while their case is under consideration. Since August 2004, workers and self-employed persons moving to Finland from a Member State of the EU/EEA or from Switzerland have been eligible for social security coverage from SII if they are employed in Finland for a period of at least four consecutive months. 3.2.1.3 Private health insurance There are three major types of private health insurance in Finland: voluntary health insurance, statutory motor accident insurance (compulsory for every motor vehicle) and statutory occupational accident insurance (compulsory for every employer). Voluntary health insurance can be divided into the following categories: sickness insurance for children, sickness insurance for adults, leisure time accident insurance, sporting accident insurance (mainly for some specific sports), insurance for medical expenses during travelling and sickness insurance taken by the employer. These types of insurance can be combined or may form part of another type of insurance, for example insurance on private property. Premiums are usually risk rated. Public regulation of these insurance schemes is limited and insurance companies can design their schemes and price premiums 51

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very freely. Voluntary private health insurance is not very common in Finland. In 2005, 375 000 children and 237 000 adults had voluntary private health insurance. By comparison it is estimated that 1.2 million people (about one fifth of the population) had leisure time and sporting accident insurance in the same year. The main reason for people to take out voluntary health insurance is to reduce out-of-pocket payments for private health care after NHI reimbursement and for outpatient drugs (complementary insurance). Out-of-pocket payment after NHI reimbursement of outpatient prescription drugs is rather high (on average 37% in 2006). The relatively high number of voluntary private health insurance policies bought for children is explained by the fact that children are not covered by occupational health care which is commonly used by the wealthy population as an alternative to municipal health care. In addition to this, there are voluntary employee relief funds in Finland, which provide additional benefits to NHI. Usually membership of a fund is restricted to employees of a specific company. The relief funds are not private for-profit companies but funds governed and owned by the members. Usually, the insurance premium (membership fee) depends on the salary of the individual. Employers may also fund these organizations. Coverage varies greatly between the funds. There are about 150 relief funds in Finland covering about 165 000 people (in 2004). Expenditures due to work accidents and occupational diseases are compensated through the statutory accident insurance system (Employment Accident Insurance Act). This insurance is provided by private accident insurance companies. Every employer is obliged to take out insurance for its employees. It covers work accidents, occupational diseases and commuting accidents. A work accident is defined as: an accident due to an unexpected, sudden external event which causes injury or illness to an employee while he or she is working, in circumstances related to his or her work or in his or her workplace, when going on errands for his or her employer or while protecting or trying to protect the property of his or her employer or while saving or trying to save human lives in the course of his or her work. An occupational disease refers to a disease which is probably primarily due to physical, chemical or biological factors associated with work done during a period of employment (The Federation of Accident Insurance Institutions, 2008).

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According to the Motor Liability Insurance Act, every motor vehicle in Finland is required to have motor accident insurance. Among other things, it covers treatment and rehabilitation from injuries suffered in traffic accidents (bodily injuries compensation). All persons injured in traffic accidents are covered by the insurance. Motor insurance is provided by private insurance companies. 3.2.2 Entitlement and benefits 3.2.2.1 Municipal health care system There is not any specific package of benefits in services provided by the municipal health care system. According to the constitution, public administration must provide sufficient health care services to everyone and promote the health of the population. The Act on Specialized Medical Care states simply that necessary services should be provided to everyone. The Primary Health Care Act defines types of services which must be provided, but not the specific benefits. Under the act the main functions of the health centre are: • to organize the provision of medical treatment for local residents and first aid in cases of emergency for anybody in the area; • to provide preventive services and offer health promotion, education and support; • to organize medical examinations and screenings; • to run maternity and child health clinics; • to arrange school, student and occupational health care services; • to organize the provision of dental health care; • to organize home nursing services; • to provide rehabilitation services; • to arrange provision of those mental health services which can appropriately be provided in health centres; and • to provide a local ambulance service. Municipalities and hospital districts have significant autonomy in defining and shaping the services they provide. There is variation in the basic profile and scope of services provided between municipalities which can be attributed to, for example, differences in financial situation, differences in shortages of professionals and differences in perceived need of services of the population. This variation is of growing concern in the country. One line of action to eliminate unacceptable differences has been to regulate access to services by law (Primary Health Care Act and Act on Specialized 53

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Medical Care). Since 2005, immediate contact with health centres during working hours by phone or personal visit must be guaranteed. If an appointment at the health centre is required, it should take place within three working days of contacting the centre (non-acute cases). If a patient is referred to hospital, treatment needs have to be assessed within three weeks of the hospital receiving the referral. Assessments can be made either based on referrals or by examining patients at the hospital. If a patient needs non-urgent hospital treatment, this treatment must be made available within six months of the assessment (see section 7.1.1.3). In connection with this reform, the MSAH has put together national guidelines on access to non-urgent specialized care based on expert proposals and previously developed national evidence-based clinical guidelines. These guidelines define which types of patients should receive the treatment guarantee. Some guidelines also use scoring systems to help determine the need for care. Guidelines have been prepared for about 190 diseases, treatment groups or conditions. This has been estimated to cover about 80% of non-emergency hospital care. One objective of the guidelines is to diminish variations between different municipalities and hospital districts in access to care. However, the guidelines are not binding, and physicians still autonomously decide whether a patient needs treatment or not (see section 7.1.1.3). If a health centre or hospital is unable to treat patients within the set time frame, the legislation requires the provider to purchase treatment elsewhere (public or private sector) within the stipulated time frame with no extra charge or travel cost to the patient. Patients can appeal to an administrative court if they feel that they have not received necessary care, although there is no explicit definition of the necessity of the care. These appeals have increased during recent years. Patients can also make complaints to the provincial administration, to the NAMLA or to the Parliamentary Ombudsman (see section 2.4.4). 3.2.2.2 Outpatient drugs Outpatient drug costs are reimbursed through NHI, administered by SII. In the scheme, there are three levels of reimbursement: 42% (limited or non-limited basic reimbursement category), 72% (limited lower special reimbursement category) and 100% (limited higher special reimbursement category). There is also a maximum annual out-of-pocket payment limit for drugs (about 630 euros in 2007), after which reimbursed drugs are free for the patient for the rest of that year. Pharmaceutical companies holding market authorization have to apply for a reimbursement and maximum wholesale price from the PPB of the Finnish 54

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MSAH. The PPB is made up of seven civil servants from different state agencies (defined in the National Health Insurance Act). Applicants must specify whether they are applying for limited basic reimbursement, basic reimbursement, or one of the limited special reimbursement categories. Applicants must also propose a reasonable wholesale price for the drug. When basic reimbursement is applied for a new drug substance, the application must contain a pharmacoeconomic evaluation. Reimbursement is granted for a maximum of five years. After that, reimbursement must be applied for again. According to the Sickness Insurance Act, basic reimbursement can be refused if the drug is used only temporarily or for the treatment of only mild diseases, the drug has insignificant benefits or the drug is not used for the treatment of disease. A drug is included in the reimbursement system if the PPB considers the price of the drug proposed by the pharmaceutical company to be reasonable. When making the decision on price, the cost of the drug is compared to its benefits, and to the costs and benefits of its therapeutic alternatives. In addition, the proposed price is compared to prices in other EU countries. In the non-limited basic reimbursement category, 42% of the cost of a prescribed drug is covered for all patients, regardless of the diagnosis. If a drug is very expensive or in very wide use and reimbursement would therefore incur expenses that are too great compared to the benefits, basic reimbursement is not granted, but limited basic reimbursement can be considered instead. In this category, drugs are 42% reimbursed only to a restricted group of patients with a certain condition or disease (for example interferon beta, dornase alfa and sildenafil are in this category). In addition to these basic reimbursement categories, some important drugs for chronic and serious diseases are selected for special reimbursement categories (72% or 100% of the price is reimbursed). This means that the drug has special reimbursement for a limited group of patients, while for the rest of patients the drug is still only 42% reimbursed. Before applying for special reimbursement, the drug must already be in a basic reimbursement category. The special reimbursement categories account for about half of total reimbursement expenses. According to the Sickness Insurance Act, drugs in the 72% reimbursement category must be essential and used in the case of severe and long-term diseases. Drugs in the 100% reimbursement category must have a corrective or supplementary effect, in addition to being essential. The Government specifies by legislative decree the diseases for which drugs can be reimbursed by 72% or 100%. The PPB decides which specific drugs are granted special reimbursement for these diseases. In order to obtain limited basic reimbursement or limited special reimbursement, patients have to comply with certain criteria which are 55

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decided by SII. For example, to obtain special reimbursement on hypertension, the patient’s level of blood pressure must exceed a specified lower limit of hypertension. In order to be eligible for the reimbursement, the patient’s physician must submit a medical certificate to SII stating that the patient has a specific disease and that the patient fulfils the criteria defined by SII. For more information on pharmaceutical care see sections 3.3.3.3 and 6.6. 3.2.2.3 National Health Insurance In addition to outpatient drug treatment, NHI provides partial reimbursement of all private health care costs (about 30% on average, depending on the type of care) (see section 3.3.3.2) and transport costs to health care units (including part of the ambulance service (see section 6.5)). The NHI scheme also compensates for loss of income during illness, pregnancy and childbirth, and for loss of income of the parents of a sick child during treatment and rehabilitation of the child. NHI also covers, through SII, rehabilitation costs in certain cases specified by an Act on Rehabilitation Benefits of the Social Insurance Institution. The sickness day allowance provides compensation for loss of earnings caused by incapacity due to an illness lasting less than a full year. It is paid to employed and self-employed persons aged between 16 and 64 years who are prevented from carrying out their regular job or a comparable gainful activity, for a maximum of 300 weekdays (including Saturdays). A waiting period, during which the allowance is not paid, comprises the day on which the illness begins plus the following nine weekdays. If incapacity to work continues for at least 55 calendar days, sickness allowance can be awarded even if the requirement concerning prior employment is not met. The amount of the allowance depends on the taxable income of the recipient. In terms of private health care reimbursement, NHI does not have any defined benefit package which it would cover (except that orthodontic or prosthodontic dental services are not covered). NHI covers a certain amount of all treatments which a physician has deemed necessary for treating a disease, pregnancy or childbirth. Private health services not treating a disease (for example cosmetic surgery) are not covered. The legislation does not precisely define which conditions are categorized as a disease and which are not. In terms of rehabilitation, SII is required by law to reimburse: vocational rehabilitation for persons with impaired functional capacity (33.6 million euros in 2005); and medical rehabilitation of persons with severe disabilities (104 million euros). The state budget also includes a special allocation for SII to reimburse other vocational or medical rehabilitation services (82 million euros). 56

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Vocational rehabilitation is covered if a person’s capacity to work and financial self-sufficiency significantly decline due to an illness or injury. The person must be given the opportunity to obtain: • essential vocational training in order to maintain or improve his or her capacity to work (e.g. basic education, further education and training); • assistance with running a business or self-employment; • basic training if it is a requirement for starting vocational training; or • for persons with severe disabilities, expensive and technically advanced aids necessary to help with work and study. Medical rehabilitation is covered for severely disabled persons, which includes extensive or elaborate out- or inpatient services which go beyond curative treatment and which are necessary in order to maintain or improve the person’s functional and work capacity. The person must be non-institutionalized and in receipt of either child disability allowance, disability allowance or pensioners’ care allowance (under 65 years of age). The SII can also reimburse, at its own discretion, vocational and medical rehabilitation services other than those described above, including services such as preventive rehabilitation measures geared to the requirements of a particular occupation, institutional rehabilitation services, training (to adapt to a sickness or disability) and psychotherapy. 3.2.2.4 Occupational health services Employers are obliged to provide preventive occupational health services for their employees. Specifically, they must provide sufficient information on health risks related to work and to advise their employees on how to avoid those risks. Furthermore, they are obliged to arrange physical examinations and first aid for their employees at the place of work. Employers are also obliged to check an employee’s health status when a job might endanger his or her health. In general, occupational health care is seen as preventive rather than curative. However, in addition to compulsory occupational health care, employers can voluntarily arrange additional health care services for their employees, so that now many employers also offer curative generalist level services. There are significant differences in the scope of curative services offered by employers. In 2004 about 84% of all employees in Finland were offered occupational health care by their employers (SII 2007b). Some small employers did not arrange services or did not apply reimbursement from NHI (Kauppinen et al. 2007). About 90% of employees receiving compulsory occupational health care services also received voluntary services (see section 2.2.4). 57

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3.2.2.5 Other types of insurance Coverage of voluntary private health insurance (both sickness insurance and accident insurance) is usually limited and there is great variation in this between different schemes. Insurance can include, for example, necessary medical treatment and compensation for permanent disabilities, loss of income or death. The usual restrictions apply, for example diseases diagnosed before the insurance has been taken, accidents related to alcohol use, treatments which are not standard medical practice, treatments of alternative medicine (such as homeopathy), medical treatments which are not a treatment of disease (for example normal child birth), dental care, rehabilitation, preventive drugs, physical therapies, eye glasses and so on. Private health insurance is usually not available for elderly people. Voluntary private health insurance covers costs to patients after they have received possible reimbursements from NHI, the statutory motor accident insurance and the statutory occupational accident insurance. Usually, voluntary insurance has deductibles and maximum annual limits of reimbursement. Compensation paid under the statutory motor accident insurance for bodily injuries due to traffic accidents covers, for example, medical treatment, compensation for loss of income, disability pension, compensation for pain and suffering, compensation for a permanent defect or disability, compensation for home care costs and compensation for rehabilitation costs. Statutory occupation accident insurance covers medical care expenses, daily allowances, an employment accident pension, inconvenience compensation, disability rehabilitation care and funeral costs. The cost of medical examinations necessary to establish the existence of an employment accident or occupational disease are also paid in full. These examination expenses are indemnified even where examinations prove that neither a work accident nor an occupational disease is concerned.

3.3 Revenue collection/sources of funds Municipalities finance 40% of total health care costs, with a further 21% being financed by the state, 17% by NHI and 22% by private sources (2005) (Fig. 3.6). The most marked change in the financing of health care has been the shift from state to municipalities. In 1990, the state financed about 36% and the municipalities about 35% of total health care expenditure. The state share has decreased radically since then, whereas the share of the municipalities has grown (Table 3.1). There has also been an increase in the amount provided by 58

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Fig. 3.6

Finland

Total expenditure on health according to source of revenue, 2005

State Municipalities National Health Insurance Households Private Insurance Employers and relief funds

Source: STAKES, 2007a.

NHI, although this is more moderate. Between the years 1990 and 2005, the share of private financing has increased only moderately (from 19% to 22%). The decrease in importance of state income tax as compared to municipal income tax in the overall mix of revenue collection has contributed to the decrease in progressivity of health financing over the last 20 years, since state income tax is progressive, whereas municipal income tax is flat rate (see section 3.3.1.1). Due to the recession the state Government decided to reduce public expenditure drastically across the board, which meant that state subsidies for health care were also severely cut. Municipalities, which have first-hand responsibility in arranging public sector health care services, were not able to reduce spending to the same extent as the state. 3.3.1 Compulsory sources of finance 3.3.1.1 Taxation Tax financing for health care comes from two different taxation systems: state taxation and municipal taxation. More than half of state tax revenue comes from the progressive gross income tax (about 20% of total tax revenue) and valueadded tax (VAT) (about 35%). Other major sources of tax revenues are corporate tax, capital income tax, alcohol tax, energy tax and car tax. In 2007, the highest level of state income tax (not including capital income) was 32% (deducted from the proportion of income exceeding 60 800 euros annually). State income tax is not paid on annual salaries below 12 400 euros. Out-of-pocket payments for health care and health insurance premiums are not tax deductible.

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State level financing of health care is largely in the form of state subsidies. On average, 16% of municipal revenue came from state subsidies which represented on average 24% of municipal budgets for health and social care in 2005. State subsidies to municipal social and health care services are calculated according to factors such as number of inhabitants, age structure, unemployment rate, remoteness and morbidity in the municipality. The amount transferred in the state subsidy is also in part determined by the potential of the municipality to raise tax revenue. In practice this means that municipalities receive a smaller subsidy if their residents have a higher average income. Because of the subsidy transfer, the total state subsidy varies greatly between municipalities. For example, the city of Espoo actually received no state subsidy in 2005 at all because of high tax revenue, while municipalities receiving the highest level of state subsidy received more than 2500 euros per resident. Municipalities also receive a general state subsidy and a state subsidy for education and culture. In addition to state subsidies, the state funds health through municipal social and health care development projects (about 40 million euros in 2007) and support to several state agencies (Fig. 2.1). The final decision on the state budget is made by the Parliament following the Governmentâ&#x20AC;&#x2122;s annual budget proposal. In 2005, 46% of municipal revenue came from municipal tax. The taxation rate is decided every year by each municipal council. Municipalities levy municipal income tax, real estate tax and they receive a share of the revenues from corporate tax, although income tax is by far the most important (87% of municipal tax income in 2005). Municipal income tax is a fixed proportion of gross wage, which varies between municipalities from 16% to 21% of taxable income (in 2007 the average was 18.5%). This has resulted in considerable variation in the amount of revenue raised from taxation between municipalities. 3.3.1.2 Statutory health insurance Part of the total cost of health care is financed by the statutory NHI scheme which reimburses, for example, occupational health care and part of the cost of private health care (see sections 3.2.2.3 and 3.2.2.4). NHI is funded by the state, employers and employees through income-based insurance fees collected with taxes. The funding of NHI is divided into two parts: sickness insurance and income insurance, and fees are set by Parliament. Sickness insurance is funded by employees (1.24% of income in 2008) and the state (approximately half of the expenses). Income insurance is funded by employees (0.67% of the income) and employers (1.97% of gross wages). For retired people the sickness insurance fee is 1.41% of income. The expenditures of both schemes 60

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are approximately equal. The total benefit payments of NHI was 3 billion euros in 2006 (SII 2007c). Regarding the other types of statutory insurance (see sections 3.2.1.3 and 3.2.2.5), in 2004 bodily injuries were compensated by motor accident insurance at a total of 191 million euros, while injuries were compensated by statutory accident insurance at a total of 593 million euros. 3.3.2 Voluntary health insurance Voluntary health insurance has a very marginal role in the Finnish health care system (see section 3.2.1.3). In 2006, Finnish private insurance companies collected 221 million euros (a little less than 2% of total health care expenditure) as premiums for all types of voluntary private health insurance. Premiums collected have increased by 61% from the year 2000. Relief funds collected insurance premiums totalling 45 million euros and employers financed funds by 20 million euros in 2004. 3.3.3 Out-of-pocket payments The share of out-of-pocket payments in total health care financing increased in the early 1990s (Table 3.1). This was partly due to the economic recession which forced the state to reduce public spending, meaning that the relative share of out-of-pocket payments increased. However, there has also been a real increase in out-of-pocket payments due to the abolition of tax deduction for medical expenses and the increase of user charges in public health care. User charges for curative outpatient services in health centres were reintroduced in 1993 (inpatient hospital care was already subject to daily fees). Before that, all visits to health centre doctors had been free of charge. The state has raised the maximum rate for user charges for health centre care several times since then. The maximum charges for hospital care and day surgery also increased several times. In addition to this, the reimbursement of NHI for private services has decreased, mainly because the level of reimbursement has not followed increases in service fees. However, the share of out-of-pocket payments has somewhat decreased again during the last five years (Table 3.1). Nevertheless, there has been concern about the consequences of high user charges, particularly their influence on the accessibility of services among lower income groups. Exemptions from user charges are not available to lowincome or any other groups. Rather, social assistance in the form of economic assistance is available when an individual’s or a family’s income is not sufficient to cover the cost of living, including health care costs. The payment of the 61

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benefit is stipulated by the Act on Social Assistance and is handled by the municipalities. Social assistance includes a basic sum of money in addition to special expenses that are taken into account separately (supplementary benefit). User charges for municipal health care and outpatient drugs can be covered under the supplementary benefit category. Under this system, user charges can be paid directly to the health care unit or pharmacy, or they can be reimbursed to the patient. The concerns that have been raised about high user charges led to the introduction of an annual ceiling for health care costs in the beginning of 2000. Within public sector health care, user charges have an annual ceiling of 590 euros, after which clients receive outpatient services free of charge. This ceiling is separate from the ceiling for out-of-pocket payments of outpatient drugs (see section 3.2.2.2). The payment ceiling applies to health centre outpatient physicianâ&#x20AC;&#x2122;s appointments, physiotherapy, a series of treatments, hospital outpatient department fees and outpatient surgery fees. Fees for short-term institutional care in both social welfare and health care institutions are partly covered by this ceiling. After reaching the ceiling the daily charge for shortterm institutional care is reduced to 12 euros. The payment ceiling for parents also covers the fees for their children under 18 years of age. Health care service users are responsible for monitoring whether the payment ceiling is met. Clients may be asked to present original receipts before being issued a certificate to prove that the payment ceiling has been met. A certificate is issued by a health centre or other public health care establishment. 3.3.3.1 Municipal health services Legislation and Governmental decree defines the maximum fees which municipalities can charge for health care services and also the services which must be provided free of charge (Act on User-fees in Social and Health Care and Decree on User-fees in Social and Health Care). Municipalities are permitted to set lower fees than defined in the legislation, but usually municipalities use the maximum fees. Usually, user charges are not collected directly in the health care facility; instead patients are given a bill which is paid by bank transfer. Preventive health care, such as the services of maternity and child health clinics, is free of charge. Also immunization, examination and treatment of some communicable diseases specified by law (sexually transmitted diseases (STDs), tuberculosis, hepatitis and some others), medical aids such as wheelchairs and other moving aids, prostheses and transport from a health care unit to another when the treatment will continue at the other unit are free of charge. Persons under 18 years of age do not have to pay for health centre ambulatory services, such as an appointment with a physician or dentist, but may be required to 62

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pay a daily charge for up to seven days of treatment on an inpatient ward of a health centre or hospital. All the amounts and reimbursement rates mentioned in the following paragraphs are maximum user-fees defined in the governmental decree (Decree on User Fees in Social and Health Care, April 2008). The current Government intends to increase these fees during 2008. Health centre user charges A visit to the maternity or child health clinic, appointments with a public nurse, and laboratory and radiological examinations are free of charge at a health centre. A health centre may charge a single or annual payment for a physician appointment. A single payment is 11 euros, which can be charged for a maximum of three appointments, that is, 33 euros per calendar year. An alternative annual payment is a maximum of 22 euros per calendar year. A fee of 15 euros can be charged for a visit to the health centre emergency clinic on weekdays between 8 p.m. and 8 a.m., on Saturdays, Sundays and bank holidays. Clients aged 15 and above may be required to pay a penalty charge of 27 euros for unattended appointments. The basic fee for dental care is a maximum of seven euros. On top of this, a fee can be charged for the treatment administered (5–130 euros). The daily charge of inpatient care in a health centre inpatient ward is 26 euros per day. Hospital user charges Hospitals charge for a visit to an outpatient department, an outpatient surgery procedure, a daily hospital fee for inpatient care, a series of treatments and rehabilitation. A hospital outpatient department visit fee is a maximum of 22 euros per visit, while the fee for an outpatient surgery procedure is a maximum of 72 euros. The daily inpatient hospital charge is 26 euros in a general hospital and 12 euros in a psychiatric hospital, covering examinations, treatment, medicine and meals. A maximum of 80% of a patient’s monthly income (for example retirement pension) can be charged for long-term hospital or institutional care. Additionally, it must be ensured that at least 80 euros monthly remains available for the patient after paying user charges to the institution. With regard to a series of treatments, 6 euros is charged for each appointment for up to 45 appointments a year. A series of treatments can be, for example, dialysis treatment, radiographic or chemotherapy and medical rehabilitation. A daily fee of nine euros can be charged by an establishment for the rehabilitation of a physically or mentally disabled person. A maximum fee of 27 euros can be charged for a medical certificate, depending on the type of certificate. 63

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Home care charges The fees for care provided at home depend on whether the care is occasional or continual. A maximum of 11 euros per visit is charged for occasional treatment by a physician or a dentist, while 7 euros is charged for a visit by other types of health care professional. A monthly fee is incurred for continual treatment, which depends on the quality and extent of the service, as well as the patient’s monthly income and family size. 3.3.3.2 National Health Insurance and private sector In the private sector, patients pay all treatment costs themselves, but may claim partial reimbursement from NHI. Private health care providers can have a contract with the SII so that private health care units can charge the reimbursed proportion from the SII directly. Fees for private services (both outpatient and inpatient care) are reimbursed by NHI at a rate of up to 60% of the established basic tariff defined by the Government. The basic tariff for a 30-minute appointment with a GP, for example, was 18.50 euros in 2007. Treatment and examination ordered by a private doctor, such as laboratory tests and X-ray examinations, are reimbursed at a rate of 75% of the established basic tariff exceeding a deductible of 13.46 euros. Private health care providers are free to set higher prices than the basic tariff, and frequently do so. This means that NHI actually reimburses only on average a third of patient fees to private services. Outpatient drugs prescribed by a private physician are covered in the same way as those prescribed in municipal health care (see section 3.2.2.2). For ambulance services a patient must pay a fee of 9.25 euros (by cash or invoice) and the rest is paid by NHI directly to the service provider. NHI also reimburses the cost of other forms of transportation in connection with the treatment and examination of a disease or accident if this exceeds 9.25 euros (for example, a taxi). If the cost of transportation paid by patients due to disease or accident exceeds 157.25 euros per year, NHI reimburses all transport costs in excess of this limit. Private dentists’ fees are also partly reimbursed by the NHI. The reimbursement rate for examination, preventive care and basic treatment is 60% of the established basic tariff (prosthetics and orthodontics are excluded). 3.3.3.3 Pharmaceuticals Patients receive 42%, 72% or 100% reimbursement from NHI for the majority of prescription drugs. However, some pharmaceutical products are not included in the reimbursement system and some are reimbursed only to some specific 64

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groups of patients (see section 3.2.2.2). There is a maximum limit for drugs to be paid by patients per year (627.47 euros in 2007). All drug costs exceeding this limit are paid by NHI (except that after reaching the limit there is a fixed deductible fee of 1.50 euros per prescription). In international comparisons, the out-of-pocket share of outpatient prescription drug expenses in Finland is quite high, at 37% in 2006 (NAM 2007). Drugs administered during inpatient care in municipal health care units are covered by hospital daily fees or other user charges describe above.

3.4 Allocation of resources and purchaser– provider relations 3.4.1 Municipal health care system In the municipal health care system, resource allocation decisions are made at the municipal level. The state subsidy that is given to municipalities for arranging social and health care services (see section 3.3.1.1) is not earmarked. Municipal primary health care is provided by health centres which are directly governed by the municipality or local federation of municipalities. Specialized care is mainly provided by hospital districts. There is not a genuine purchaser–provider split in Finnish public health care, since municipalities both fund and own the service provision organizations. This is especially clear in primary health care, where the provider (health centre) is usually an integral part of municipal administration. However, very recently a few municipalities have introduced a purchaser–provider split to their administration (for example, the cities of Tampere, Oulu and Raisio). In 2007, there was one municipality which outsourced the provision of all services in primary health care. This municipality (Karjaa) has drawn up a contract for the next several years with a private NGO-based foundation to provide primary health care and elderly care to its inhabitants (see section 7.1.2.3). In addition to this, it is increasingly common for municipalities to purchase segments of services or specific service items from the private sector (for example, certain specialist care operations). The provision of municipal health services by municipalities’ own units without any purchaser–provider separation is subject to continuous debate in Finland. Some argue for full separation of the two roles, some argue for preservation of the integrated system. It is claimed that a true purchaser–provider split would enhance steering and make the municipal administration more transparent. It would also better allow the outsourcing of services to private 65

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providers, which has been argued to be a more efficient way to provide services. Introduction of a purchaserâ&#x20AC;&#x201C;provider split and outsourcing are most visibly backed by private health care providers, the Ministry of Employment and the Economy, the Finnish National Fund for Research and Development (Sitra) and right-wing politicians. Decisions on resource allocation, planning and organization of health care services are made by municipal health boards, municipal councils and municipal executive boards (see section 2.2.1). The health boards prepare the proposals for health budgets of the municipalities and the municipal councils approve them. Budgets are typically based on historical data and allocated without any specific targets or incentives. Municipalities usually have separate budgets or budget sections for primary health care (health centres) and specialized health care (hospital districts). There is great variation in terms of how resources are allocated between health stations (in larger cities the services of health centres are provided through several health stations located in different parts of the city) and inpatient and outpatient care. This is because there is no state level guidance on this level of resource allocation and the different systems in the municipalities have evolved independently over many decades. In hospital districts (see section 2.2.1 for details on their structure and function), it is the hospital district council which adopts the annual budget, approves the financial statements and makes decisions about major investments. There are different contractual or negotiation mechanisms between hospital districts and municipalities for agreeing target volumes and payments which comprise elements of purchaser and provider separation. These mechanisms have been under continuous change and development since 1993, when the new relationships came into effect (Act on Specialized Medical Care). A hospital district and its member municipalities usually negotiate on a yearly basis a target for volumes of services and subsequent costs. These two constitute the core of the operational plan and the budget for each year. Both the volumes and costs are planned on the basis of the previous year. In many cases views on the right size of the resource allocations differ between the municipalities and the hospital districts. There is a tendency for budgets to be too low and agreements are therefore sometimes revised during the year according to the actual amount and type of services provided by hospital districts. Usually there are no explicit sanctions if there is deviation from agreed plans and targets and municipalities cover any deficits and retain any savings in their accounts. Inside the hospital district resources are allocated between specialties and hospitals based on negotiations with municipalities on volumes of services. Particularly in the case of small municipalities, negotiations are shaped by the significant information and economic asymmetry between the municipality 66

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and the hospital district (Häkkinen 2005). In general, municipalities complain that they have too little influence on the volume and costs of hospital care of the hospital districts. For municipalities, it is much easier to contain the costs of their own health centres than it is to contain their share of the expenses of the hospital district. There are currently many ongoing development projects and natural experiments to address these issues (see section 7.1.2.2). In addition to contracting specialized health care services from their hospital districts, municipalities can organize specialist level services themselves, for example by using health centres as a base for consultative services. Municipalities can also purchase services from other hospital districts or from private providers. However, the volume of such arrangements is rather insignificant compared to services contracted from municipalities’ own hospital districts. In these cases service providers are usually paid on a case-by-case basis classified by the treatment given. 3.4.2 National Health Insurance and occupational health care The Parliament allocates resources to NHI by defining insurance fees (see section 3.3.1.2). The SII, which administers NHI, does not make purchasing contracts with private health care organizations; instead reimbursements are applied for directly by patients (except outpatient pharmaceutical reimbursements). NHI supervises neither the quality nor the efficiency of the private services which it funds (except by reminders in serious cases of obviously inappropriate drug prescriptions). Occupational health care services are usually purchased by employers from private providers or municipalities. In these cases there is clear purchaser– provider separation and employers define by contract the level and scope of services purchased for their employees. Some larger companies may also own their own service provision units so that they can provide health services inhouse.

3.5. Payment mechanisms 3.5.1 Paying for health services In primary health care, municipalities prospectively fund the budget of the health centres they maintain on their own. Usually budgets are set based on previous budgets. In federation-owned health centres the budgets are also prospective and 67

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built in a similar way but the sharing of costs to municipalities is determined usually by the volume of services given (see section 3.4.1). Hospital district invoicing and pricing is in a continuous process of change, varying from district to district (Häkkinen 2005) and at present, it is difficult to directly compare the services and prices between different hospitals and hospital districts. Apart from some special arrangements for maintenance of readiness for catastrophes (such as large scale traffic accidents or natural disasters) or pooling of exceptionally high costs, payments of municipalities are mainly based on price lists by either service item or a package of services (along the general principles of NordDRG (diagnosis-related group) pricing). In 2003, a survey found that eight hospital districts used NordDRG-based invoicing in somatic inpatient care and day surgery while the majority of districts used service groupings of their own (Punkari and Kaitokari 2003). Municipalities are charged prospectively but finances are balanced retrospectively according to actual services purchased. All hospital districts have also developed a special funding pool between member municipalities to cover exceptionally high individual patient expenses (typically above 50 000 euros per individual patient or episode). When municipalities and hospital districts make contracts to buy services from private providers, contracts and payment mechanisms vary considerably. These contracts must be arranged by open competition, due to anti-trust legislation. For private care patients, NHI reimburses costs for some services (see section 3.3.3.2) and some pharmaceuticals (see section 3.2.2.2). Occupational health care services are paid for by employers according to contracts between employers and providers (private providers or municipalities). Some larger companies may also have their own units to provide these services. Varying payment mechanisms are used in these contracts. Services are paid fully by employers and employers are partly reimbursed retrospectively by the NHI. NHI reimbursement is based on actual costs. 3.5.2 Paying health care personnel 3.5.2.1 Physicians The salaries of all physicians working in the public sector are negotiated by the physicians’ trade union (the Finnish Medical Association) and the Commission for Local Authority Employers. Other groups of health professionals have similar arrangements. The state plays no role in this procedure. Strikes by physicians are not very common. The last, by physicians in spring 2001 over pay and conditions of work, took five months to resolve. There has been only one previous strike episode by physicians, during the 1980s. 68

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The payment system of GPs in municipal health centres varies between municipalities. The traditional payment method, which currently applies to about 45% to 50% of health centre physicians, is through a monthly salary with some extra fee-for-service payments for selected time-consuming service items or minor procedures. In those health centres where the personal doctor system has been introduced (see section 6.3), doctors are paid a combination of a basic salary, capitation payment and fee-for-service payment for visits. During the last 10 years a new trend has emerged, that is outsourcing of the physician workforce (Vuorenkoski and Mikkola 2007). New firms have emerged which lease physicians to public sector primary health care. These firms are mainly owned by the physicians themselves. In these firms physicians are employed by the company and their salary is negotiated with the company. Municipalities use these services mainly when they have difficulties in recruiting physicians, especially for out-of-hour duties, although recently physicians have been leased by long-term contract for office-hour duties as well. These firms can offer better salaries and more flexible working conditions than municipalities and are therefore an attractive alternative for physicians. In 2004 about 5% of Finnish physicians worked in these firms (younger physicians are especially interested in these positions). Physicians in hospital districts are salaried employees. The basic monthly salary depends on the physician’s post and length of career. Various bonuses can be paid, such as for increased responsibility, but in practice this is little used. Usually there are no financial incentives for physicians to increase efficiency and quality. There is additional remuneration for being on call (it can also be taken as leave). Physicians receive some extra payments for issuing certificates of health status for various purposes. In addition, until recently there was a “special payment category” system in public hospitals. The same principle and practice occurs on the international scene, known as “semi-private beds”. According to this scheme, patients had the possibility to choose their medical doctor in public hospitals by paying extra fees, most of which go to the attending doctors. However, this special payment category was abolished in February 2008, and a new scheme has been introduced, in which private services can be offered in public hospitals during weekends and after 4 p.m. during weekdays. The system aims to compensate physicians for the loss of special payment category fees but in a way that will distribute earnings more equally among physicians and other hospital staff. The new system is also claimed to promote more efficient use of hospital facilities and equipment and to give the patients more freedom to choose their doctor and timing of care. The new scheme is a supplementary system and all patients still have their former rights to receive care at public hospital outpatient departments at defined fees during normal 69

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working hours. However, to date this system has not been implemented in any hospital district, because current legislation does not allow NHI reimbursement under it. Physicians’ earnings depend largely on how much they work out-ofhours, and how many bonuses they receive for experience, level of training, responsibility and so on. Specialists who work in private practice in addition to their work in public hospitals, and personal doctors who see a lot of patients and do a large amount of on-call work usually have a much higher income than those who work only during regular hours. The basic salary of primary care physicians was on average 5200 euros per month in 2006. The basic salary of hospital physicians was on average 4700 euros per month. These figures include the salary from working regular hours, but not for example payments for being on call or night duties. It is common that medical doctors working in public hospitals have a private practice in private facilities during evenings on a fee-for-service basis. In private health care, physicians usually work as autonomous practitioners. In these cases, practitioners are free to set their own rates. The SII has set a maximum level of reimbursement to the patient, but private practitioners are not obliged to set their fees at these levels and NHI has no contracts or negotiations on the level of charges. During recent years small private health care provider clinics have merged to form fewer, larger national level health care provider companies. An emerging trend is that physicians work for these firms as salaried employees rather than autonomous practitioners. 3.5.2.2 Nurses and midwives Nurses and midwives have a basic monthly salary and compensation for doing out-of-office hours work (which is set at about 30% extra). The basic salary depends on the competence and experience of the employee. The average monthly salary of nurses is low, at about 2400 euros in 2006, including extra compensations. There are not any major differences in nurses’ salaries between public and private health care, and between primary and specialized health care. Nurses have gone on strike several times in recent decades without results. In late 2007, their union took extreme measures and threatened not only a strike but also mass-termination of their contracts because of their low pay levels. The politically sensitive and publicly very high-profile and serious conflict ended with a compromise at the last moment.

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3.5.2.3 Pharmacists Pharmacies are privately owned by pharmacists (see section 6.6). From the difference of wholesale price and retail price (average around 26% of net sales) pharmacists must pay taxes (VAT at 8%), rent and salaries of employed personnel and so on. Pharmacies also pay a graded pharmacy fee to the state which depends on their net sales. The function of the pharmacy fee is to decrease the differences in income between pharmacies, but there are nevertheless major differences in profits between pharmacies (MSAH 2007a). In 2005, the average annual profit for a pharmacist was 280Â 000 euros (9.2% of the net sales), after overheads and running costs.

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4. Planning and regulation

4.1 Regulation

4.1.1 National level steering and regulation he MSAH directs and guides the development of health care at the national level. It defines the main course of social and health policy, prepares legislation and key reforms and steers their implementation, and handles the necessary links with the political decision-making process. In addition to legislation, health services are steered from the national level by programmes, information and resources. One of the most important tools in the national level steering process is the National Development Programme for Social Welfare and Health Care (previously the Target and Action Plan for Social Welfare and Health Care) which is drawn up for the whole period of office of each Government (normally four years). The general aims of the health care policy and the measures that will be taken in order to fulfil these aims are adopted in this document. The programme could be described as a cooperation plan between municipalities and the state. The Advisory Board of Social Welfare and Health Care is responsible for its preparation, implementation and follow-up. In addition, there are five regional steering groups. In relation to this programme the state funds local development projects in the social and health sectors (annually worth about 25 million euros). The programme also steers activities of KTL, STAKES, the Occupational Health Institute and provincial administration. The Government has also implemented a major measure for steering health care on a more ad hoc basis. In 2001 the Government initiated the ‘National Project to Ensure the Future of Health Care’, proposed by the Prime Minister and the Minister of Social and Health Services at the time. This was a response to several years’ debate concerning various problems in access to health care 73

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services. Based on the health-related needs of the population, the aim of the project was to ensure the availability, quality and appropriate volume of care throughout the country, irrespective of residents’ ability to pay. The main outcome of the project was the ‘Decision in Principle by the Council of State on Securing the Future of Health Care’ issued by the Government in 2002 (MSAH 2002), which focused on primary health care and preventive work, ensuring access to treatment, the availability and expertise of personnel, reforming functions and structures of health care, and augmenting the finances of health care (see section 7.1.1.2). A further example of Government programme steering is ‘Health 2015’, a public health programme enacted in 2001, which outlines the targets for Finland’s national health policy for the next 15 years (MSAH 2001a). The main focus of the strategy is on health promotion and the development of the health care system (see section 6.1.1). In addition, the MSAH has a wide variety of other projects to develop health care, for example for developing electronic prescriptions and nationwide electronic patient record systems (see section 7.2.2). Several bodies established at the national level have some direct regulatory functions (see section 2.2.2). The two most important of these in regard to health services in general are the health and social departments in the provincial administration and the NAMLA. In 2006, national level supervision was reinforced by expanding the functions of the NAMLA from supervising individual professionals to supervision of health care organizations, municipal health centres and hospital districts. Pharmaceutical markets are regulated by the NAM. STAKES has a central role in guidance through the provision of information (see section 4.2.2). STAKES produces statistical and comparative information and information on best practices in the field of welfare and health and forwards them to decision-makers and other actors in the field. For example, in recent years special quality guidelines have been developed for school health care and mental health care. Finland has been active in seeking external international reviews and evaluations to develop national health policy. The latest health policy review was conducted by OECD in 2005 (OECD 2005). 4.1.2 Regulation of municipal health care services Municipalities have a significant degree of freedom to plan and steer health care services. National legislation provides only a framework for the provision of health services at the municipal level. There are two main acts which set this 74

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framework, (the Primary Health Care Act, 1972 and the Act on Specialized Medical Care, 1991). Further legislation includes, for example, governmental decrees that explicitly define which vaccinations (Decree on Vaccinations and Screenings of Communicable Diseases During Pregnancy) and which screenings (Decree on Screenings) municipalities must provide free of charge. Legislation also defines explicit maximum waiting times (the Primary Health Care Act and the Act on Specialized Medical Care) and maximum user-fees (Act on Userfees in Social and Health Care and Decree on User-fees in Social and Health Care) for municipal services. The other main tools for steering municipal health services from the national level are information and local development programmes. STAKES has the main responsibility for managing information, and the application of EBM, local auditing and quality development programmes. By funding local development programmes the state can also attempt to influence services at the local level. However, the National Audit Office of Finland has conducted an audit of the system of development programmes in 2007 and found that it is not as efficient as it could be (Vuorenkoski 2007b). There have been some recent changes which have increased the possibility for stronger state regulation of municipal services (see section 7.2.3). Oversight of municipal health services is mainly in response to complaints or other highly visible problems in the operation of services. If the state level administration (either the ministry, the NAMLA or the provincial state authorities), detect overt violation or neglect of existing health service legislation, they can intervene. Usually this means raising problems to start a discussion, or issuing reminders or formal warnings. For example, in 2007 the NAMLA approached municipalities which did not comply with the maximum waiting time guarantee and urged them to fully implement the guarantee. There is another option of imposing a conditional fine in very special situations, but in general this is not used. Municipalities or municipal federations usually directly own and regulate health centres (see section 2.2.1). However, there has been a growing debate on whether municipalities should introduce a purchaserâ&#x20AC;&#x201C;provider split and outsource municipal administration, which would change this situation (see sections 3.4.1 and 7.1.2.3). Municipal regulation of specialized care is more complex. Hospital districts are governed by member municipalities which can influence hospital districts through their representatives on the executive board and the council of the hospital district (see section 2.2.1). Not including negotiations on volumes and costs (see section 3.4.1), municipal regulation of hospital districts is rather weak. This is particularly the case with small municipalities, where there is 75

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significant information and economic asymmetry between the municipality and hospital district (Häkkinen and Lehto 2005). 4.1.3 Regulation of National Health Insurance NHI is run by the SII which is under the direct supervision of the Parliament. The Parliament regulates NHI by legislation (the Sickness Insurance Act) and through a board of Parliamentary Trustees of the SII. The legislation defines which services SII reimburses. NHI is also controlled to some extent by the Insurance Department of the MSAH. For example, the department contains the PPB, which decides on the inclusion of drugs in the drug reimbursement system (see section 6.6). SII does not regulate the private health care providers to which it makes reimbursements. This has not generally been perceived as a problem. 4.1.4 Regulation of private sector and private insurance Regulation of private health care is stipulated in the Private Health Care Act, but is quite weak in Finland. Private health care providers must have a licence acquired from the provincial state administration. The provincial administration monitors the services to ensure they meet adequate standards and quality criteria. Independent private practitioners and private health care providers are also monitored by the NAMLA through patient complaints (see section 2.4.4). Private physicians who are members of the Finnish Medical Association are also regulated by the Association’s own codes of conduct, for example on the advertising of physician services to the public. If municipalities and hospital districts purchase services from the private sector, they regulate and control purchased services by contracts. Private health insurance is regulated by corresponding acts and the Insurance Department of the MSAH (see section 3.2.1.3).

4.2 Planning and health information management The MSAH has the main responsibility for national level planning of the health care system. The general aims of the health care system and the measures that will be taken in order to fulfil these aims are outlined in National Development Programme for Social Welfare and Health Care (see section 4.1.1). In addition to this, every year the MSAH draws up an administrative action and finance 76

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plan for the next four years. This document covers starting points and strategies, provides estimates and plans development. In addition to this general planning conducted at the national level, municipalities are responsible for more practical planning, for example concerning infrastructure, capital and personnel. STAKES supports planning at the municipal and ministry level by carrying out research and development projects and collecting register information. Municipalities’ planning activities are also supported by the Association of Finnish Local and Regional Authorities, of which municipalities are members. In primary care planning is performed by the chief physician and other senior individuals, the municipal council, the municipal health committee and the executive board. In hospital districts it is performed by chief physicians and other senior individuals, the council of the hospital district and the executive board. Citizens can participate in planning through the politically elected municipal council and municipal health committee (see section 2.2.1). It should be noted that the size of municipalities varies greatly and because of this there are significant differences between municipalities’ ability to carry out health care planning. 4.2.1 Health technology assessment The Finnish Office for Health Technology Assessment (Finohta) was established in 1995 within STAKES. The centre’s main objectives are to improve the effectiveness and cost-effectiveness of care and to promote the use of evidencebased methods in health care. Operation of Finohta is steered and regulated by the MSAH and STAKES as financiers. Finohta also has an Advisory Board on Health Care Technology Assessment which has representatives from organizations and communities that are relevant to their activities. The advisory board monitors the technology assessment system and the activities of Finohta and makes proposals to develop them further. Secondly, it has a Scientific Committee on Health Care Technology Assessment which has a broad representation of expertise in many scientific fields. The committee participates in selecting the technologies to be assessed and joins various scientific fields together in order to promote multidisciplinary assessment activities. The committee also produces expert statements and develops Finohta’s operations. Health technology assessment (HTA) of screening and rehabilitation is a priority, while pharmaceuticals are not a priority and are dealt with in assessments only as comparators to other methods. Finohta projects also investigate the social, ethical and legal aspects related to the technology in question. In addition, Finohta disseminates HTA information produced abroad and gives methodological and financial support to systematic reviews and 77

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research projects evaluating the cost-effectiveness of a given health technology. The Finnish branch of the Nordic Cochrane Centre is based within Finohta. In 2006, Finohta had a staff of 32 persons in Helsinki and Tampere covering a variety of professional expertise. In addition to this, national experts of various medical specialties are invited to participate in HTA projects as needed. The bulk of the yearly budget of 2.2 million euros is state funding. The resources available are quite limited meaning only a fraction of new technologies can be evaluated. Finohta has a major role in EUnetHTA, a large European collaborative project drafting a joint HTA methodology. Finohta completes between three and five major assessments yearly and between five and ten more limited HTAs, including systematic literature reviews (see section 5.1.3). The office disseminates assessment results both from Finland and other countries through several series of publications and the website (see section 10.3). In collaboration with other organizations, Finohta also provides education on HTA and evidence-based health care. The first Finnish language textbook of HTA was written by Finohta experts and published in 2007 (Mäkelä et al. 2007). 4.2.2 Information systems Information on the health care system and health status is collected in many different ways. This information is mainly collected by Statistics Finland, STAKES, KTL and the SII. 4.2.2.1 Health status Annual health survey on behaviour among the Finnish adult population, KTL Since 1978, KTL has annually monitored the health behaviour of the adult population through postal surveys. Each year a random sample (n=5000) of Finnish citizens aged between 15 and 64 years is taken from the population register. The average response rate has been 70% among men and 80% among women. The primary purpose of monitoring is to obtain information on health behaviour such as smoking and dietary habits and changes of habits. The questionnaire also includes questions about the consumption of alcohol, physical activity, dental health, perceived general health status and the use of health services. National Register of Infectious Diseases, KTL Physicians and laboratories are obliged by law to inform KTL about the incidence of certain defined infectious diseases. These diseases include infectious diseases which are severe and highly infectious and diseases which are included in the 78

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vaccination programme. In total there are approximately 30 diseases on the register, such as HIV, hepatitis, tuberculosis and measles. National Death Register Statistics Finland maintains a national death register based on death certificates issued by physicians. Registry of Occupational Diseases The FIOH has maintained the Registry of Occupational Diseases since the year 1964. All work accidents and occupational diseases which are reported to the statutory accident insurance system are registered. In addition, occupational diseases which are reported by physicians to occupational safety authorities are included in the register. National Health Insurance Statistics, SII The SII extensively collects and reports information concerning NHI. These include, for example, data on drug reimbursement (utilization), sickness allowances, disability pension, occupational health services, private care reimbursements and rehabilitation reimbursements (see section 2.2.3). Register of Congenital Malformations, STAKES The Register of Congenital Malformations contains data on congenital anomalies detected in stillborn infants and in live born infants before the age of one year. The register receives data from hospitals, health care professionals and cytogenetic laboratories as well as from the Birth and Care Registers maintained by STAKES and the Cause of Death Register maintained by Statistics Finland. The register contains data from 1963 onwards. Register of Visual Impairment, Finnish Federation of the Visually Impaired, STAKES The Register of Visual Impairment is maintained for STAKES by the Finnish Federation of the Visually Impaired. Notifications are sent to the register by the treating physician or another member of the care personnel. The register contains data on cases of visual impairment from 1983 onwards. Database on alcohol and drugs, STAKES This database contains data gathered from different authorities on the consumption and use of alcoholic beverages and drugs, the alcohol economy, the adverse health effects and social effects of substance abuse, and services for substance abusers. The database was established in 1995 (alcohol statistics have been gathered since the year 1932). Cancer Register, the Cancer Society of Finland, STAKES The Cancer Register is maintained for STAKES by the Cancer Society of Finland. Notifications on cases of cancer are sent to the register by physicians, pathological, cytological and haematological laboratories and Statistics Finland (death certificate data). The register was established in 1952. 79

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4.2.2.2 Health care services Hospital Discharge Register, STAKES The register contains client-specific hospital discharge data on institutional care in social and health care. Hospitals (both public and private hospitals) and health centre inpatient wards report the end of all periods of care (including ambulatory surgery) to the register. The register includes, for example, age, sex, diagnosis, treatments given and treatment period. In addition, client censuses are conducted concerning all clients that have received care at the end of the calendar year. Health Care Activity Statistics, STAKES These statistics relate to public ambulatory health care and support services. The data are collected as summary data from health centres and hospital districts. Between 1994 and 2001, the statistics were compiled by the Association of Finnish Local and Regional Authorities. After that, STAKES became responsible for the compilation. Before 1993, the MSAH maintained a report system for social welfare and health care. Municipal Database for Social and Health Statistics The Municipal Database for Social and Health Statistics (SOTKA) contains statistical data and indicators concerning welfare and health collected from different sources. Municipality-specific data concerns various items, including municipal finances, population, families, housing, social and health care personnel, use and expenditure of services. Statistics on Municipal Finances and Activities, Statistics Finland Statistics Finland gathers information on municipal finances and activities on a yearly basis. The statistics contain information on municipally funded services, meaning services that the municipality provides itself for its inhabitants or purchases from other municipalities, municipal federations, the state or private service providers. Statistics on Health Care Expenditure, STAKES The data on health care expenditure and financing is derived from a database maintained by STAKES. Data for the database comes from various health care statistics, inquiries and studies. The earliest data is from 1960. Register of Induced Abortions and Sterilizations, STAKES STAKES maintains a register on abortions and sterilizations from the reports of the treating physicians. Data on induced abortions has been collected since 1950 and on sterilizations since 1935. Infertility treatment statistics, STAKES The infertility treatment statistics contain data on advanced infertility treatments. Data is collected on the number of procedures, the background information of treated women or couples and the results of treatments (pregnancies, deliveries 80

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and births). STAKES has gathered this data from the year 1994 onwards. The data is obtained from all clinics giving infertility treatments. Medical Birth Register, STAKES The register contains data on mothers and children born in Finland. The data is gathered from hospitals and complemented by data obtained from the Cause of Death Register of Statistics Finland and by data from the Central Population Register. The register contains data from 1987 onwards. Register of Health Care Professionals, NAMLA The NAMLA is responsible for the authorization and registration of health professionals. Every year STAKES compiles statistics concerning these professional groups. Register of Municipal Employees, Statistics Finland The register contains data on personnel employed by municipalities and municipal federations. Statistics on Private Health Care, STAKES The statistics are based on activity reports submitted by private health care providers to the Provincial State Offices. The statistics contain data on ambulatory service provision and employees. Drug consumption statistics, NAM The NAM gathers drug consumption statistics. The sales figures are based on the sales of the three largest drug wholesalers in Finland, which together account for nearly 100% of total drug sales. The remainder (about 1%) is mainly comprised of hospital sales. Adverse effects of drugs and devices, NAM Information on adverse effects of drugs and medical devices is gathered by the NAM. The information is gathered from physicians, dentists and manufacturers. National Implant Registers, NAM The NAM keeps the Implant Register on Orthopaedic Endoprostheses and the Register on Dental Implants. 4.2.3 Research and development There are many organizations contributing to health care research and development in Finland. Main state level organizations are STAKES, the FIOH and KTL. The MSAH has a small research and development unit which is responsible for overall coordination of research and development activities in the social and health sector. 81

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STAKES produces and disseminates knowledge and expertise on the social and health sector to decision-makers and other actors in the field. STAKES is a centre of expertise, and its core functions lie in research, development and information resources. In 2006 STAKES had a staff of about 500. It had 25 million euros for operational expenditure from the state budget, which was 66% of its total funding. Every year an operational plan is negotiated and agreed with the MSAH which gives STAKES guidelines for the activities of the next year. STAKES has a Health Services Research division which has about 90 employees. The division includes the HTA unit (Finohta) (see section 4.2.1) and the Centre for Health Economics. Currently, health care related activities of STAKES include among other things research on: equity and quality in health care services; health economics; development of information systems; health promotion; mental health; and substance abuse. STAKES also has a separate division for maintaining national statistics and registers in the health and welfare fields. The WHO Collaborating Centre for Mental Health Promotion, Prevention and Policy Implementation (WHO-MH3P) has been in STAKES since 2006. Research and development work is also an important part of the activities of FIOH. The aim of this work is to generate new knowledge that can be applied to improve working conditions, to promote workers’ health and work ability, to ensure the smooth functioning of working communities, and to enhance wellbeing. Most of the research done by FIOH is applied research yielding results that can be quickly put to use in Finnish working life. Some of the research aims at more long-term results, seeking to understand, for instance, the causal mechanisms of diseases and determining the theoretical basis for occupational health-related phenomena. In 2006 FIOH had a staff of about 800. KTL monitors the health of the population and the factors influencing it. Additionally, it develops tools to promote public health and distributes information to decision-makers, actors and individual citizens. Together with the relevant authorities, organizations and health experts, the institute participates in the national and international tasks of health promotion. The institute maintains monitoring and information systems. It also modifies data, whether collected by itself or some other party, for the use by decision-makers and other actors. In 2006 KTL had a staff of about 900. The Rohto was established in 2003 to deal with the assessment of drugs, especially those used in primary health care, and the implementation of such information to develop pharmacotherapy in Finland. In addition to about 10 full-time employees, Rohto has part-time employees working in the field. Implementation of knowledge for promoting rational pharmacotherapy is based on local Rohto educational and development activities coordinated by regional facilitators in hospital districts and by local facilitators in health centres. 82

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The SII has a research department, which undertakes research and development projects focusing on social security and health provision of the Finnish population and on the benefit schemes, client services and other operations of SII. It has a staff of about 60 persons. Research is focused on for example, the following topics: the need for health services and rehabilitation and their outcomes; mental health problems as a cause of work disability; the funding of health care through insurance-based arrangements; the targeting of drug reimbursements according to needs; and the links between the availability of drug reimbursements and the use of prescription pharmaceuticals. The Academy of Finland, which works under the supervision of the Ministry of Education, provides funding for high quality scientific research, serves as an expert organization in science and science policy, and strengthens the position of science and research in society. One of the four councils of the Academy is the Research Council of Health. In 2005 the Academy of Finland funded research on medicine and health sciences to a sum of 42 million euros. The Academy of Finland also had a special Health Services Research Programme during the years 2003–2007. Sitra is an independent public foundation under the supervision of the Finnish Parliament. Its activities are designed to promote the economic prosperity of the Finnish people. The Fund was set up in conjunction with the Bank of Finland in 1967 in honour of the 50th anniversary of Finnish independence. The Fund was transferred to the supervision of the Finnish Parliament in 1991. Sitra has a Health Care Programme, the objectives of which are: to improve the status of customers in health services; to increase the profitability and effectiveness and the cooperation between the public and private sectors; to promote the comprehensive use of new technologies and services; and to generate new business in Finnish and international markets. In 2007 the programme included six projects: Health Fund, internationalization, paperless health care, multi-centre specialized health care, seamless services and support services. In addition to venture capital investments, approximately three million euros annually have been reserved for these development projects. Health Fund was founded in 2006 as a new venture capital fund which invests in health care and companies serving the health care industry. Investments can be made in either existing or start-up companies that apply the best practices in health care. The aim of the investments is to enhance productivity of the health care sector and the acceleration of structural change. The Health Fund had 28 million euros worth of capital in 2007 from which 10 million is invested by Sitra. TEKES, governed by the Ministry of Employment and the Economy, promotes the competitiveness and profitability of Finnish industry and the service sector by assisting in the creation of world class technology and technological know-how. From the perspective of the health care system the most important 83

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programme of TEKES is the Healthcare Technology Programme lasting from 2004 to 2009 (FinnWell). The objective of the programme is to improve the quality and profitability of health care, and to promote business activities and export in the field. The total value of the programme is 150 million euros, of which TEKES invests about half and the participants of the programme fund the other half. Three kinds of projects are funded by the programme: development of technologies for diagnostics and care; development of information technology products and systems that support care, follow-up or prevention of illnesses; and development of the operational processes of health care. TEKES also funds programmes for the biomaterial industry and pharmaceutical industry. Other important research organizations are the universities and polytechnics (also called universities of applied sciences). These organizations conduct for example, clinical research, nursing research, health economics and health care administration research, health policy research and health sociology. The main organizations which conduct clinical research are five medical faculties connected to five university central hospitals. Health service providers receive special earmarked contributions from the state which are intended to compensate for the research component of their work (49 million euros in 2006 from which 84% was given to university central hospitals).

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5. Physical and human resources

5.1 Physical resources

5.1.1 Infrastructure inland does not have an explicit national level planning system for health care infrastructure. Planning for health care services is decentralized: the 415 municipalities and 20 hospital districts are responsible for planning on a municipal level. At the national level, STAKES gathers information concerning infrastructure and provides this information on a regular basis to municipalities and hospital districts for planning purposes. Planning in private health care rests solely on the provider companies. In 2005 there were 46 episodes of inpatient care in health centres per 1000 inhabitants and 209 episodes in hospital districts per 1000 inhabitants (Table 5.1). Health centre inpatient wards cater mainly for the needs of elderly persons including long-term care services (see section 6.3). Finland no longer compiles data on general hospital bed numbers. However, we can estimate the number of beds based on the number of care days assuming a 100% occupancy rate: there are estimated 3.1 hospital beds per 1000 inhabitants in hospital districts, 3.8 per 1000 inhabitants in health centres and 0.3 per 1000 inhabitants in private health care facilities. The average length of stay (excluding psychiatric beds) was 5.4 days in hospital district hospitals and 30.4 days in primary health centres in 2006 (STAKES 2007d). There has been a shift from inpatient care to day surgery since the 1990s (see section 6.4). In the early 1990s there were 4.3 acute hospital beds per 1000 inhabitants (Fig. 5.1), comparable to the EU average. During the period 1990â&#x20AC;&#x201C;2003 the number of acute care beds decreased to 2.3 per 1000 population, so that towards the end of the decade Finland (together with Sweden) had the lowest number of acute hospital beds among the Nordic countries (Fig. 5.2). Compared to western 85

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Table 5.1

Finland

Patients in inpatient care

1995/1996 2005 Municipal primary care (health centres) Periods of care (per 1000 inhabitants) 39 46 Care days (per 1000 inhabitants) 1371 1388 Municipal specialized care (hospital districts) Periods of care (per 1000 inhabitants) 210 209 Care days (per 1000 inhabitants) 1561 1149 Private health care Periods of care (per 1000 inhabitants) 10 14 Care days (per 1000 inhabitants) 97 92 Treatment of mental disorders Periods of care (per 1000 inhabitants) 14 14 Care days (per 1000 inhabitants) 500 397 Source: STAKES, 2006b.

Europe, the reduction in acute hospital beds in Finland was steep (Fig. 5.1). In 2003, the number of hospital admissions in acute care was similar to the EU average, while the average length of stay was among the lowest (Table 5.2). Between 1995 and 2005 inpatient psychiatric hospital care days decreased from approximately 500 to 397 days per 1000 inhabitants (Table 5.1). This reduction is largely due to declining average lengths of stay, since the number of inpatient episodes have not decreased during this period. During the 1990s many long-term patients were transferred from institutionalized care to outpatient care and ‘transitional’ services such as supported housing. 5.1.2 Capital stock and investments From the 1970s until the 1980s there was a special state subsidy system to support capital investments. From 1993 the state almost totally withdrew from funding capital investments. Currently, capital investment in health care is controlled by the providers: municipalities, hospital districts and private providers. The state level administration may only intervene in special situations, for example if an important building is removed from active use due to health and safety reasons. The municipalities and hospital federations are free to invest in technologies. Municipalities and hospital districts normally fund the investments from the annual budget (see section 3.4). Usually the hospital and health centre buildings are owned by the municipal service providers. Many of the hospital buildings were built in the 1950s–1960s, and health centre buildings 86

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Fig. 5.1

Finland

Hospital beds in acute hospitals per 1000 population in the European Union, 1990 and 2003 or latest available year (in parentheses)

EU Member States since 2004 or 2007 EU15 average (2005) EU United Kingdom (1998) Turkey The former Yugoslav Republic of Macedonia Switzerland (2005) Sweden (2005) Spain (2005) Slovenia Slovakia (2005) Romania Portugal (2005) Poland Norway Netherlands Malta (1997) Luxembourg (2004) Lithuania (1992) Latvia (1998) Italy (2005) Ireland (2005) Hungary Greece (2005) Germany (1991) France (2005) Finland Estonia Denmark (2004) Czech Republic Cyprus (2005) Belgium Austria 0

2.0

4.0

6.0

8.0

10.0

2006 1990

Source: WHO Regional Office for Europe, January 2007. Note: EU: European Union.

were built about 20 years later. Both hospitals and health centre facilities are increasingly requiring renovations. 5.1.3 Medical equipment Public sector health care units (health centres and hospital districts) fund medical equipment from their annual budget. There is no state level control over the acquisition of medical equipment, even concerning very expensive equipment. Because of this, it can be assumed that there is considerable variance in geographical distribution of equipment, although there is no data to support this. In 2005 there were 14.7 magnetic resonance imaging units and 14.7 computed tomography (CT) scanners in Finland per million population (Table 5.3). 87

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Fig. 5.2

Finland

Beds in acute hospitals per 1000 population in Finland and selected other countries

9 8 7 6 5 4 3 2 1 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Denmark Sweden

Finland United Kingdom

Germany EU average

Norway

Source: WHO Regional Office for Europe, January 2007. Note: EU: European Union.

Health care units can seek advice from Finohta (see section 4.2.1) when making decisions to acquire new medical equipment. In 2006 Finohta and hospital districts initiated a joint process to develop a structure for joint appraisal and decision-making with regards to the uptake of new medical technologies (MUMM-programme) (Kaila 2007). In 2007 a pilot assessment on five interventions was done (intravenous laser therapy for varicose veins, MARS – liver dialysis, vacuum treatment of wounds, long anti-thrombotic treatment in conjunction with joint replacement surgery, and 64 multislice-CT in the diagnosis of coronary disease). The second set of selected topics include: spinal cord stimulation for chronic back pain, radio-frequency ablation for snoring, vagus nerve stimulator treatment for treatment resistant depression and epilepsy, and treatment of macular degeneration with intravitreal anti-vascular endothelial growth factor injections. Over the next few years it will become evident whether this process improves the managed uptake of new medical technologies in hospital districts. 5.1.4 Information technology Almost all health centres and some hospital districts have electronic patient records and other information technology systems for data management. However, the Finnish health care system is decentralized and the development of health care information systems has been pronouncedly uncoordinated which 88

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Table 5.2

Finland

Inpatient utilization and performance in acute hospitals in the European Union, 2006 or latest available year

Hospital beds Admissions Average Bed per 1000 per 1000 length of occupancy population population stays in days rate (%) 26.1b 6.9b 79.6a Austria 6.4a a b b Belgium 4.7 16.2 8.0 67.3b h h h Bulgaria 7.6 14.8 10.7 64.1h b b b Cyprus 3.5 7.9 6.0 84.5b a a a Czech Republic 6.1 20.5 8.0 72.9a c f c Denmark 3.1 17.8 3.4 84.0f a a a Estonia 3.9 16.8 5.9 70.9a a c c Finland 2.4 19.9 4.2 74.0i b b b France 3.7 16.5 5.9 77.1c a a a Germany 6.2 20.3 8.5 76.3a b g d Greece 3.9 14.5 5.7 66.6g a a a Hungary 5.5 23.0 6.1 70.3a b b b Ireland 2.9 13.9 6.6 85.6b b c c Italy 3.4 14.3 6.7 76.4c a a Latvia 5.3 20.3 – – Lithuania 5.1a 20.7a 6.9a 76.1a Luxembourg 5.1c 18.4j 7.7g 74.3j a a a Malta 2.9 11.4 5.3 89.6a a f c Netherlands 3.0 8.8 7.0 58.4f e Poland 4.7 – – – Portugal 3.0b 11.3b 7.1b 73.2b Romania 5.1a – – – b b Slovakia 6.2 18.1 8.1b 67.2b Slovenia 3.8a 17.1a 5.8a 71.6a b b b Spain 2.7 11.6 6.7 79.1b b b b Sweden 2.8 15.1 6.0 77.5h g h h United Kingdom 2.4 21.4 5.0 80.8g a b b EU average 4.1 17.1 6.7 75.9b b c c EU 15 average 3.9 16.9 6.7 – Source: WHO Regional Office for Europe, January 2007. Notes: a 2006; b 2005; c 2004; d 2003; e 2002; f 2001; g 1998; h 1996; i 1995; j 1994; EU15: EU Member States before 1 May 2004.

has resulted in a situation where non-interoperable information systems are used even within individual health care organizations. However, national level steering has strengthened recently. Parliament decided in December 2006 that a statutory nationwide electronic patient record (EPR) system and nationwide electronic prescription system will be introduced in Finland following a fouryear transition period (see section 7.2.2). 89

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Table 5.3

Finland

Items of functioning diagnostic imaging technologies

MRI units CT scanners

per 1 million population 1995 2005 4.3 14.7 11.7 14.7

Source: OECD, 2007. Notes: MRI: Magnetic resonance imaging; CT: Computer tomography.

In terms of general Internet utilization in 2006 there were 477 Internet subscriptions per 1000 inhabitants (Statistics Finland 2006b) and 61% of Finnish people (aged 15–74 years) used the Internet weekly from home, workplace or from their place of study.

5.2 Human resources 5.2.1 Trends in health care personnel The majority of health care professionals working in the health care sector are employed in municipally operated health services (health centres and hospital districts). The distribution of municipal employees across the different professional groups is shown in Table 5.4. In 2005 there were 123 700 municipal employees in the health care sector of whom 71 400 (58%) were working in hospital care (STAKES 2007d). The number of employees has risen by 15% since 1995. In the private sector there were 28 400 employees in 2004. Some of the registered professionals work in other sectors or in other countries; in 2006, 840 doctors and 4010 nurses were employed outside Finland. Until the 1990s unemployment among physicians, dentists and nurses was practically non-existent, but the economic crisis led to a reduction in health care resources and significant unemployment. In addition, the yearly intake to medical schools was reduced in the early 1990s, as it was predicted that the need for medical doctors was decreasing. As the public sector gradually recovered from the economic crisis in the late 1990s, a significant physician and dentist shortage developed. In order to rectify this situation the yearly intake of medical students was increased from 365 to 627 in the period 1995–2005. However, this measure will take many years to significantly address the physician shortage. Until 2007 there have been considerable difficulties to recruit physicians and dentists, especially to rural health centres which have disproportionately fewer physicians. For example, in October 2006 9% of the physician posts in health centres were not filled but in the Kainuu region (northern Finland) this figure 90

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Table 5.4

Finland

Health care personnel (man years)

Municipal health care Registered1 Proportion in per 10 000 per 10 000 municipal 2005 population 1990 2005 population increase health care Health and social 3 320 3 310 6 0% services managers Other senior officials 520 440 1 -15% Physicians 17 101 33 8 070 10 340 20 28% 60% Dentists 4 537 9 1 960 2 040 4 4% 45% Senior nurses and 7 170 5 690 11 -21% ward sisters 61 86% 60% Nurses 62 333 120 17 190 31 890 Public health 14 024 27 4 520 5 140 10 14% 37% nurses Radiographers 3 327 6 1 420 1 740 3 23% 52% Midwives2 3 722 7 220 1 470 3 40% Dental hygienists3 1 456 3 210 650 1 210% 45% Auxiliary nurses 81 996 158 19 030 30 030 58 58% 37% Auxiliary mental 5 223 10 4 660 2 740 5 -41% 53% nurses Hospital and 2 033 4 710 670 1 -6% 33% ambulance attendants Dental assistants 6 123 12 2 430 2 600 5 7% 43% Physiotherapists 11 290 22 1 290 2 250 4 74% 20% Occupational 1 732 3 280 560 1 100% 32% therapists Medical laboratory 6 771 13 2 830 3 520 7 24% 52% technologists Assistant nurses 14 150 6 460 12 -54% and hospital ward assistants Sources: STAKES, 2006b; Statistics Finland, 2006b. Notes: 1Working age; 2Midwives were officially composed of a distinctive group from nurses in 1994; 3Statistical increase of dental hygienists is partly explained by the change in professional title.

was 26% (Parmanne and Vänskä 2006). Currently, the shortage is even more significant among dentists. About 12% of dentist posts in health centres were not filled in 2007 (MSAH 2008a). In addition, in spite of a significant increase in the number of nurses and auxiliary nurses since 1990, currently health care providers have increasing problems to recruit enough nurses. During the years 1990–2005 the number of registered working age physicians increased by 41%. The number of physicians working in municipal health care increased by 28% during the same time period (Table 5.4). In 2006 47% of physicians worked in hospitals, 23% in health centres, 5% in occupational health 91

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care, 6% in the academic field and 11% in full-time private practice (Suomen Lääkäriliitto 2006). The average age of working age physicians has increased by three years to 46 years during the last 10 years (Elovainio et al. 2007). In 2006 the number of physicians per capita was the same as the EU average, while the number of nurses was slightly higher (Fig. 5.3) (note that Fig. 5.3 shows active personnel while Table 5.4 shows registered personnel). Fig. 5.4 compares the trend in the number of physicians in Finland from 1990 to 2006 with selected other countries. In comparison to the Scandinavian countries, the number of physicians per 1000 population in Finland remains one of the lowest but it has steadily increased since 1990, reaching the EU average by 2005. During the years 1994–2005 the number of registered working age nurses increased by 33% and in 2005 there were 12 registered working age nurses per 1000 inhabitants (Table 5.4). More than half of Finland’s dentists, dental hygienists and dental assistants are working in the private sector, as the majority of services are provided there. During the years 1990–2005 the number of registered working age dentists increased by 1%. The number of dentists and dental assistants in the municipal sector remained almost the same during the same time period (Table 5.4). During the years 1990–2005 the number of registered working age pharmacists increased by 61%. In 2007 there were 1400 pharmacists and 3800 assistant pharmacists working in pharmacies (excluding hospital pharmacies). Very few pharmacists work in the municipal sector (those that do are mainly in hospital pharmacies). 5.2.2 Planning of health care personnel In Finland there is no state level mechanism to directly steer strategic human resources for health geographically or by level of care, except to influence the education of health professionals. However, in the last few years general level needs assessment and human resource planning have been conducted in the context of overall labour projections in collaboration with the Ministry of Education, the Ministry of Labour, MSAH, Statistics Finland and municipal organizations. The Ministry of Education is responsible for regulating and supervising the training of health care professionals. Universities are public, but autonomous. In theory, universities are free to decide on the number of students to be taken in, but in practice, the Ministry of Education and the universities reach an agreement on the budget and number of students. Polytechnics (institutions providing training for nurses) are governed by municipalities under the guidance 92

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Fig. 5.3

enmark Finland

Number of physicians and nurses per 1000 population in Finland and selected other countries

Monaco (1995,1995) Greece (2004,2004) Belgium (2003,2004) Switzerland (2005,2000) Italy Iceland (2005,2004) Israel Netherlands Norway Denmark (2004,2004) Austria Malta Portugal France Germany (2005,2004) Andorra Sweden (2004,2002) Spain (2003,2000) Finland (2003,2004) Ireland Luxembourg (2004,2004) San Marino (1990,1990) Cyprus United Kingdom (2002, –) Turkey (2003,2004) Central and south-eastern Europe Lithuania Bulgaria Czech Republic Estonia (2004,2004) Latvia Slovakia (2004,2004) Hungary Serbia Croatia Slovenia (2004,2002) Poland (2004,2004) The former Yugoslav Republic of Macedonia Romania Montenegro Bosnia and Herzegovina Albania (2004,2005) CIS Belarus Georgia Russian Federation Kazakhstan Azerbaijan Armenia Republic of Moldova Ukraine Uzbekistan Turkmenistan (2004,2004) Kyrgyzstan Tajikistan Averages CIS average EU Member States before May 2004 (2004,2004) EU average

6.6 4.9 3.5 4.4 13.4 3.9 8.3 3.9 7.0 3.7 9.4 3.7 6.1 3.7 14.5 3.7 15.3 3.6 9.8 3.5 6.1 3.5 5.5 3.4 4.6 3.4 7.5 3.4 7.7 3.4 3.4 3.2 10.2 3.2 3.7 3.2 7.6 2.8 15.4 2.8 9.5 2.5 5.1 2.4 4.0 2.1 1.4 2.6

16.2

4.0 7.4 3.6 4.0 3.6 8.5 3.2 6.4 3.2 5.4 3.1 6.6 2.8 8.8 2.6 5.4 2.5 5.2 2.3 7.2 2.2 4.6 4.8 2.2 3.7 1.9 1.9 4.9 1.4 4.4 1.2 3.6 4.7 4.5 4.2 3.7 3.6 3.5 3.1 3.0 2.7 2.6 2.5 2.0

3.9

4.1

4.7 5.8

11.9

8.0 6.4 7.2

7.1 7.8 10.2

4.4

3.7 3.4 3.2 0

Physicians Nurses

7.9 7.5 7.0 5

Number per 1000 inhabitants

Source: WHO Regional Office for Europe, January 2007. Notes: CIS: Commonwealth of Independent States; EU: European Union. 83 93

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Fig. 5.4

Finland

Number of physicians per 1000 population in Finland and selected other countries

1 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Denmark Sweden

Finland United Kingdom

Germany EU average

Norway

Source: WHO Regional Office for Europe, January 2007. Note: EU: European Union.

and financial support of the Ministry of Education. The Ministry of Education also consults the MSAH on the number of students needed. During the early 1990s, in connection to the economic recession, entrance places in medical schools were reduced. However, from the mid-1990s a significant shortage of physicians developed due to the gradual recovery of the public sector. To address this shortage, the yearly intake of new medical students was increased (Fig. 5.5). However, the impact of this measure takes a long time to take effect and there is still a lack of physicians in Finland. The same pattern can also be seen among dentists. Training for pharmacists and assistant pharmacists has also increased during the years 1995–2005. In the future the need of health care professionals will increase mainly for two reasons. Firstly, a significant proportion of health care professionals will retire in the near future. Secondly, the demand for health services will continue to increase with the ageing population and growing expectations for medical care. 5.2.3 Training of health care personnel Physicians are educated at five universities. Universities are public and education is free of charge. Entrance is based on grades from high school and on entrance exams. Basic medical education lasts six years and contains 94

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Fig. 5.5

Finland

New students accepted in universities (related to health care)

700

600

Students

500

400

300

200

100

0 1990

1992

1994

1996

1998

2000

2002

2004

Year Health scientist Physician Dentist Assistant pharmacist Pharmacist

Source: KOTA, 2007.

considerable guided practical training. After studies in university, two years of practical work and training is required, both in hospitals and in health centres, to obtain a licence to work independently as a physician. Part of this training may be completed in the private health care sector or by practising scientific research. Dentists are trained in three university medical faculties and their studies last five years in total. To become a specialist, physicians and dentists must register with a faculty of medicine for the relevant specialist training programme. Specialization lasts five to six years depending on the specialty. To obtain a specialist diploma, a specified amount of theoretical study is required and a national examination must be passed in addition to the required amount of clinical work. Specialization begins with the resident working as a junior hospital doctor at a central hospital or district hospital under the supervision of an experienced physician. This is followed by at least one or two years working at a university hospital 95

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in addition to a structured training programme which is required for most medical specialties. In 2006 about 63% of working age physicians had specialist training (the majority of the rest were working as GPs) and 22% had a PhD degree (Suomen Lääkäriliitto 2006). According to the statistics of the Finnish Medical Association, there were estimated 360 physicians licensed in Finland in 2007 who were not Finnish. The largest groups of foreign physicians were from Estonia and the Russian Federation. The training of nurses and other health care personnel such as physiotherapists, midwives and laboratory personnel takes place at polytechnic schools. In Finland general and specialized programmes of nursing have been combined: students have common training in general nursing, complemented with training from a specialty of their choice: nursing for surgery and internal medicine; paediatric nursing; anaesthetic and operating theatre nursing; or psychiatric nursing. The training programme for public health nurses lasts three and a half years and for midwives four and a half years. Assistant nurses used to be trained in a one-year programme, but this programme has been abolished. Instead, a new two and a half-year programme in basic care provision has been launched in both health and social services. Finnish universities also have programmes of nursing science and health sciences. Both of these lead to bachelor and master degrees. These programmes lead to administrative, educational and scientific careers. Training of pharmacists and assistant pharmacists takes place in three universities. Pharmacist education takes five years and assistant pharmacist three years. Training of psychologists also takes place in the universities. Legally, health centres and hospital districts are responsible for arranging continuous education for their personnel (Primary Health Care Act and Act on Specialized Medical Care). It is recommended that 3–11 days training per year is undertaken, depending on the type of profession. After graduation, continuous medical education for physicians is provided by employers, medical societies, universities and pharmaceutical companies. 5.2.4 Registration/licensing The NAMLA is responsible for licensing, registration and, together with the State Provincial Offices, supervising of health care personnel. It also undertakes disciplinary procedures (99 procedures in 2006) concerning health care personnel. Health care professionals in Finland are licensed for their entire active careers and systems of periodic relicensing are not in use.

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6. Provision of services

6.1 Public health

ealth promotion, including the prevention of diseases, has been the main focus of Finnish health care policy for decades. This has resulted in the eradication of certain communicable diseases, a decrease in several lifestyle-related diseases and an improvement in the health of the population. Health promotion is carried out on a national and municipal level. Many NGOs also implement extensive programmes for health promotion. Health promotion is funded primarily through municipal budgeting. In addition, the state budget includes a separate allocation for health promotion programmes (9.3 million euros in 2007) from which contributions are given upon application for projects arranged by municipalities, NGOs and other actors. NGOs are also eligible for financial support from the revenue of the Slot Machine Association (see section 2.2.5). 6.1.1 National level At the national level, the MSAH is the main actor to protect and promote public health. It has responsibility within the state administration for health protection, environmental health and chemical affairs, and tobacco and alcohol control. Several agencies and institutions subordinate to the ministry carry out some of these tasks (STAKES, KTL and the FIOH). The goal is to address health issues in all societal sectors and all policies. In 2007 the Government initiated a new four-year multisectoral Government Policy Programme for health promotion (see section 7.1.1.9). The aim of the programme is to promote health and reduce health disparities through coordinated actions of different ministries. The overall health promotion target is based on the Health 2015 public health cooperation programme, which was approved by the Government in 97

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2001 (MSAH 2001a). The programme outlines the targets for Finland’s national health policy for the next 15 years. The strategy design was based on the WHO Health for All programme, revised in 1998. The strategy is a continuation of the Finnish national Health for All 2000 programme which was adopted in 1986 (MSAH 1987). The public health cooperation programme provides a broad framework for health promotion in various component areas of society. It reaches across different sectors of administration, since public health is largely determined by factors outside health care. The concepts ‘settings of everyday life’ and ‘life course’ play a key role in the programme. The strategy presents eight targets for public health, which focus on important problems requiring concerted action by various bodies. Examples of these targets include: to increase average healthy years of life by two years, to cut accidental and violent death among young adult men by a third, to delay average retirement age by three years and to reduce smoking among young people. In addition, there are 36 statements concerning the lines of action underlined by the Government, incorporating challenges and guidelines related to citizens’ everyday environment and various actors in society. The programme was prepared by the Advisory Board for Public Health set up by the Government. The process involved consultation with specialists, analyses, seminars and group work. National level responsibility on the prevention of communicable diseases rests with KTL. The Institute also reports on communicable diseases to health authorities, health care providers, the mass media and the general public. KTL and the hospital districts maintain communicable disease registers. Doctors are obliged to report certain communicable diseases, including tuberculosis, diphtheria, hepatitis, malaria, HIV, poliomyelitis, cholera and rabies. Also, microbiological laboratories report any incidence of these infectious diseases and related observations. Additionally, KTL runs many programmes to decrease the burden caused by several other diseases, such as cardiovascular diseases and mental health problems. Occupational health promotion is arranged by employers. According to law (Occupational Health Care Act), employers must provide services that are necessary to prevent health risks caused by work. They must also provide sufficient information on health risks related to work and to advise their employees on how to avoid those risks. Furthermore, employers are obliged to check an employee’s status of health when a job might endanger his or her health. The FIOH carries out research, offers training for occupational health and safety professionals, provides advisory services and disseminates information on occupational health. 98

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Efforts have been made to reduce the consumption of harmful products, such as alcohol and tobacco. This has partly been achieved by taxation, which has kept the prices of alcohol and tobacco products at a high level. As in most other Nordic countries, the sale of alcohol has been a state monopoly, making it possible to regulate prices and sales. Smoking is reduced by smoking cessation campaigns, pricing and legislation. Since the 1970s, Finland has had extensive tobacco legislation, prohibiting tobacco advertising and smoking in public places. In 1995 smoking became prohibited at workplaces, and in 1999, restrictions were imposed on smoking in restaurants. The most recent reform of the Tobacco Act was enacted in June 2006. The new act bans smoking in pubs and restaurants, except in specific closed and ventilated rooms where food or drink are not permitted. Small pubs had to implement the reform by July 2007, whereas larger pubs and restaurants have a transition period until July 2009. The sale of tobacco to children under 18 is prohibited in Finland. Advertising of tobacco and strong alcohol is also prohibited. The state supervises, integrates and steers environmental health policy as a whole. The primary responsibility for environmental health policy, however, is devolved to the municipalities. Tasks at the national level are divided between several ministries. State Provincial Offices direct and supervise environmental health services on a regional level. Environmental health services in Finland include the following: the quality and hygiene of foodstuffs, health impacts of housing and public areas, noise abatement, the quality of drinking- and bathing-water, assessment of adverse environmental health effects and waste management. Furthermore, surveillance of gene technology, chemical control and protection from radiation are included under environmental health policy. 6.1.2 Municipal level At the municipal level public health is primarily the responsibility of the health centre, according to the Primary Health Care Act. In Finnish terminology, legislation and practice, ‘primary care’ carries the double meaning of primary health care and public health. In addition, environmental authorities, social welfare authorities, work health and safety authorities and local school authorities are responsible for some public health activities. Maternal and child health care and school health care are the most important municipal services for promoting public health (see also section 6.1.4). Maternal and child health care has a strong tradition in Finland pre-dating the establishment of health centres. Partly owing to the comprehensive network of maternal and child health care services and the great emphasis placed on them, 99

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infant mortality in Finland is one of the lowest in the world. Children and young adults also receive extensive publicly funded preventive dental care. Municipalities are also responsible for providing free immunizations for residents. The general immunization programme in Finland, which mainly follows WHO recommendations, covers the whole population. It starts with child health care in health centres and is continued in schools. The national vaccination programme includes diphtheria, tetanus, pertussis, measles, mumps, rubella, polio and Hib. The vaccination programme was last revised in 2006, when vaccination for tuberculosis only for children at risk was introduced. Vaccination coverage is relatively high in Finland (Fig. 1.3). In 2005, about 93% of children born in 1999 received all vaccinations included in the national vaccination programme (Joensuu et al. 2005). The decree of the MSAH also includes vaccination against influenza for certain high-risk population groups. KTL has defined that free influenza vaccinations should be provided to people aged over 65 and to younger people with specific chronic diseases. Municipalities are obliged by decree of the MSAH to provide breast cancer screening for all women between the ages of 50 and 69 in two-year intervals and cervical cancer screening for women aged 30–60 years in five-year intervals. Breast cancer screening was expanded to 60–69 year-olds at the start of 2007. In 2002, 88% of those who received an invitation participated in mammography screening and 72% in screening for cervical cancer (Cancer Society of Finland 2005). In addition, some municipalities are offering breast and cervical cancer screening to other age cohorts and also other screening services such as osteoporosis or bowel cancer screening (the latter may become a national programme depending on the results of an ongoing evaluation). The majority of municipalities provide antenatal screening for chromosomal and structural malformations (see section 6.1.4). Across all municipalities newborns are screened for hypothyreosis. Municipalities provide family planning and other reproductive health services. The prevention of STDs is based on the detection of all those infected and on easy access to treatment that is free of charge. All those possibly infected are to be identified and directed to a health centre or elsewhere to receive treatment. The largest cities have separate STD clinics in their health centres, but otherwise treatment is provided as part of general health centre services. Because of comprehensive family planning services provided by health centres and health education targeted to young people, the abortion rate in Finland is rather low, despite a liberal abortion law. Municipalities are responsible for the implementation of environmental health services in their respective areas. Environmental health activities can be either under the health centre or under the local municipal environmental 100

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protection authority. Municipal health inspectors ensure that environmental health legislation is complied with and provide consultation and guidance in environmental health issues. For wider environmental problems or catastrophes, the provincial or state authorities work together with the municipal level authorities. 6.1.3 Other organizations and programmes There are many NGOs working in the field of health promotion in Finland. The Finnish Centre for Health Promotion is an umbrella organization with 125 member organizations. Its aim is to promote cooperation between universities, officials and organizations performing health promotion work. The centre participates in several projects, programmes and campaigns (for example on promoting health in schools, prevention of domestic accidents, environmental health and drug abuse). It produces professional publications, guides, posters, reports and the health promotion magazine ‘Promo’. The main funding sources of the centre are the Slot Machine Association and the MSAH. The centre has a staff of about 25 persons. There have been several major public health campaigns in Finland to reduce mortality and risk factors related to chronic disease. For example, in 1972, the North Karelia Project was launched in the eastern province of North Karelia in response to a local petition to reduce the high coronary artery disease mortality rates among men (Puska et al. 1995). The North Karelia Project was launched as a community-based, and later as a national, programme to influence diet and other lifestyles that are crucial in the prevention of cardiovascular diseases. The original project period lasted from 1972 to 1977, but it continued operating beyond this period until the end of the 1990s. The prevalence of cardiovascular diseases among men in the eastern parts of Finland was higher than in other parts of the country and was one of the highest in the world. In cooperation with local and national authorities and experts, as well as with WHO, the project was designed and implemented to carry out comprehensive interventions through community organizations in the area, and the actions of people themselves. The project was integrated as far as possible into the local service system and social networks. Various methods were used in the project: provision of general information and health education (through materials, mass media, meetings, campaigns, etc.); development of referral and screening procedures in health services; encouragement of environmental changes (such as smoking restrictions, promoting vegetable growing, collaborating with food manufacturers); preventive work directed at children and young people; and training and education of health personnel. Much of the practical work was carried out by 101

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various bodies in the community itself, coordinated by hospitals and health centres. Over the 25-year period since the start of the project, major changes have taken place. Among men in North Karelia, smoking has greatly reduced and dietary habits have markedly changed. In 1972, a little more than half of middleaged men in North Karelia smoked. In 1997 the percentage had fallen to less than a third. By 1995 the annual mortality rate of coronary heart disease among men under 65 years old was reduced by about 73% from the pre-programme years (Puska, Pietinen, Uusitalo 2002). Among women, the reduction in deaths from cardiovascular diseases has been of similar magnitude. Broad community organization and the strong participation of people were the key elements of the success of the programme. Perhaps the greatest impact of the North Karelia Project was inspiring the whole country in the nationwide implementation and boosting primary health care in the country. The project also contributed to policy changes in health, agriculture and commerce within Finland as a whole. For example, the food industry collaborated with the project to promote low-fat dairy products, as well as salt reduction in several foods. On the other hand, smoking dropped dramatically among men but actually increased among women. Recently, the increasing prevalence of type 2 diabetes has been notified as a major current public health problem in Finland. As a result the National Programme for the Prevention of Type 2 Diabetes 2003–2010 (DEHKO) was set up (Finnish Diabetes Association 2003). The programme is coordinated by the Finnish Diabetes Association and a wide variety of other relevant organizations are participating. The programme comprises three concurrent strategies: the Population Strategy aimed at promoting the health of the entire population by means of nutritional interventions and increased physical activity so that the risk factors for type 2 diabetes, such as obesity and metabolic syndrome, are reduced in all age groups; High-Risk Strategy comprises measures targeted at individuals at particularly high risk of developing type 2 diabetes, providing a systematic model for the screening, education and monitoring of people at risk; the Strategy of Early Diagnosis and Management is directed at persons with newly diagnosed type 2 diabetes with the aim of bringing these people into the sphere of systematic treatment, thus preventing the development of diabetic complications that reduce the affected person’s quality of life and are expensive to manage. The food industry is increasingly taking recommendations on healthy nutrition into account in its product development. For example, the supply of milk products with a low percentage of animal fat has widened and the use 102

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of vegetable oil has increased. Healthy nutrition has also been supported by legislation. 6.1.4 Maternal and child health According to the Primary Health Care Act, health centres must have maternity and child health clinics. Free-of-charge child health clinics have existed in Finland since the late 1940s. The purpose of maternity clinics is to promote the health and well-being of parents, foetus and newborn child. The aim is to help parents in preparation for parenthood and for the changes brought on by the arrival of a child, as well as to promote a healthy lifestyle. Support is provided for the whole family, paying particular attention to parenthood and the relationship between the parents, with the father’s role and responsibility as a parent playing an integral part. Maternity clinics are also responsible for birth preparation, identification of complications relating to the pregnancy and referral of the mother for further treatment, as necessary. Women with normal pregnancies attend the clinic between 11 and 15 times. Most of the appointments are with a public health nurse, and two to three visits are with a physician. Most health centres provide ultrasounds between weeks 12 and 16 of pregnancy to screen for chromosomal and structural malformations (for example Down’s syndrome), but there are significant variations between municipalities in the provision of these screening services. However, a decree obliging municipalities to provide antenatal screening on a nationally uniform basis will come to force in 2010. Almost all pregnant women have a checkup at the maternity clinic in a health centre at least once before the end of the fourth month of their pregnancy, because this check-up is a precondition for receipt of the maternity grant. The objective of child health clinics is to promote the health of children and the welfare of families, and to reduce inequalities in health between families. The child health clinics monitor and support the physical, psychological and social development of under school-age children, and support parents in safe, child-centred upbringing, good child care and the relationships between parents. The focus is increasingly placed on identifying possible problems that families with children have at as early a stage as possible, and on arranging appropriate support. The national recommendation is that child health clinics arrange 16 periodic check-ups, five of which are appointments with a physician and the rest with a public health nurse. There are eight check-ups for under one year-olds, four check-ups per year for one and two year-olds, and one check-up per year for older children until the child attends school where she or he receives school 103

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health care. A public health nurse carries out a home visit before and after the birth, and at other times if needed. Additional support is provided through parent groups. Child health clinics are increasingly involved in multi-professional cooperation with other organizations that work with families with children. The clinics also administer the vaccinations provided under the immunization programme (see section 6.1.2). Maternity and child health clinics have been very successful in Finland. Infant mortality has decreased rapidly over the last 30–40 years. At the beginning of the 1970s, almost 15 out of every 1000 newborn infants died; since the mid1990s the rate has been less than 5 per 1000, one of the lowest in the world (see also section 1.5).

6.2 Patient pathways There are three main systems providing health care services in Finland: municipal health care, occupational health care and private health care. The advantage of the municipal system is that it provides comprehensive services and there are low user-fees. The advantage of occupational health care is that there are short waiting times and it is free of charge. The advantage of private health care is that there are short waiting times and the patient is free to choose the provider. Usually, employed persons can choose between these three systems (see section 2.4.2). According to a recent population survey, about 45% of physician visits by employed people were in occupational health care, 35% were in municipal health care and 15% were private health care (Perkiö-Mäkelä et al. 2006). For low-income, unemployed or retired persons or children from low-income families the municipal health care system is, in practice, the only option. Municipal health care is accessible for all permanent residents of the municipality (see sections 2.2.1 and 3.2.1.1). Patients cannot choose their health centre. In larger cities there are many health stations serving different geographical areas of the city and people are registered to one of these. Initially, patients should contact the health centre by phone to make an appointment. At this point the need for care is assessed. If a patient needs to visit a physician or nurse (see section 6.3), an appointment is made. In some municipalities patients can choose a physician in the health centre (see section 6.3). There can be long waiting times for health centre physician appointments in non-acute cases. If the physician in the health centre assesses that a patient needs secondary health services, the patient is referred to secondary care in the hospital district. Patients cannot choose the hospital they are referred to. There can be long 104

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waiting times for outpatient hospital appointments. After specialist level care is received the referring physician receives a discharge summary from the hospital district and is responsible for further follow-up. If the discharged patient is not fit to live at home, the patient is taken to the inpatient ward of the health centre. The municipality can also provide suitable home care or other institutional long-term care if necessary. Most employers provide voluntary curative services (see section 2.2.4). In these cases a patient can attend an occupational health care clinic assigned by the employer free of charge (there are different kinds of limitations on services employers provide). If the physician in occupational health care assesses that the patient needs secondary health services, the patient can be referred to the hospital district (municipal system) or to a private specialist or private hospital. Occupational health services are free of charge. If a patient wants to use private services, the patient can choose any private physician. The patient can go directly to an outpatient specialist provider. Usually, the patient has to first pay the full costs of the services and then receive reimbursement from NHI (on average 30% of expenses). If the patient has voluntary private sickness insurance, after NHI reimbursement she or he can claim part of the out-of-pocket expenses from their insurance company (see section 3.3.3.2). If the physician in private health care assesses that the patient needs secondary health services, the patient can be referred to the hospital district (municipal system) or to the private system. For the majority of NHI benefits (for example sickness allowance, higher drug reimbursement, rehabilitation and compensation of travel costs to a health care unit) a patient needs a medical statement from the treating physician (see section 3.2.2.3).

6.3 Primary care The current system of delivering municipal primary health services originated with the enactment of the Primary Health Care Act in 1972. This act represents one of the major milestones in the history of Finnish health care. It adopted a broader perspective on the provision of primary care than simply the provision of general medical treatment, covering primary medical care and public health. It obliged municipalities to provide these services to their inhabitants in what was a completely novel provider organization at that time, a “health centre”. A municipal health centre can be defined as a functional unit or an organization that provides primary curative, preventive and public health services to its population. It is not necessarily a single building or a single 105

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location; health centre activities can be organized at several locations, for example, maternal and child health care or school health might be provided at a separate location from the health centre doctor’s office. Large cities usually have activities organized at several health stations. Health centres are owned by one municipality or jointly by several municipalities through a federation. They do not aim to make a profit: they are publicly owned and run (see section 2.2.1). There were 237 health centres in Finland in 2007. In sparsely populated areas such as Lapland, the distance to the nearest health centre facility is much greater than in the more densely populated south. The size of a health centre varies, depending on the number of people it serves. When health centres were first set up, it was thought that they should serve a population of at least 10 000, but later health centre federations were permitted to divide, so the number of health centres went from 205 to a peak of 279. In January 2007, Parliament introduced a law outlining that primary health care services would be run by organizations covering at least 20 000 inhabitants, following a four-year transition period. Currently, only about one in four health centres has population base of 20 000 or more (see section 7.2.1). Health centres offer a wide variety of services: outpatient medical care, inpatient care in inpatient wards (in larger cities these can be classified more as a GP-run hospitals), preventive services, dental care, maternity care, child health care, school health care, care for older people, family planning, physiotherapy and occupational health care. Legislation does not stipulate in detail how the services should be provided, and in most cases this is left to the discretion of the municipalities, although for some services there are national guidelines (for example on maternity and child health clinics, for school health care and for screening). Health centres are usually well equipped with staff and medical technologies. In addition to the physicians’ and nurses’ consulting rooms, there are normally X-ray facilities, a clinical laboratory, facilities for minor surgery and endoscopic examinations and equipment such as electrocardiogram and ultrasound. The personnel of health centres consists of a wide selection of various health professionals: GPs, who can hold the specialty of general practice or sometimes also other clinical specialties, nurses, public health nurses, midwives, social workers, dentists, physiotherapists, psychologists and administrative personnel. The number of inhabitants per health centre physician varies, averaging about 1500–2000. According to Nordic principles, general practice is a specialty comparable to other clinical specialties, with six years of postgraduate training. However, it is not obligatory to be a specialist in general practice medicine to work as a 106

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physician in a health centre. Originally it was planned that health centres were to have permanent posts available only for specialists, but with the shortage of health centre physicians this was not possible. In 2006, approximately 30% of all physicians working in health centres specialized in general practice (Suomen Lääkäriliitto 2006). The main work of health centre physicians is to provide office-based general medical care to patients of all ages. They are also involved in maternal and child health care, school health services, occupational health care, family planning, care in the health centre inpatient wards, home nursing (although home visits by GPs are not very common; these are more often done by nurses), consultation at municipal nursing homes and in various public health and forensic activities. The tasks are often divided up among the health centre physicians according to the circumstances of the centre and the experience or interests of the physicians. Some health centres have arranged for specialists to come for regular consultations – for example, a radiologist from the nearby hospital to interpret X-rays. The GP-run inpatient department of a health centre works in much the same way as a hospital department. A typical health centre has between 30 and 60 beds. The number of inpatient departments within a health centre varies; large centres have several. The large majority of inpatients of health centres are older people with chronic diseases. The average age of these patients was 75 years in 2005 (STAKES 2006c). A significant part of the care provided in this setting is long-term care; in 2005 54% of inpatient days were for patients who stayed in the unit for more than six months (STAKES 2006c). In remote, sparsely populated areas, however, health centres provide comprehensive emergency and shortterm curative inpatient services to the entire population. During recent years, many municipalities have sought to curtail specialist hospital costs by quickly admitting post-operative surgical patients to health centre inpatient wards. Nurses play an essential role in Finnish health centres. There are nurses with a general nursing education who, in addition to assisting GPs, have their own consulting hours for giving injections, removing sutures and measuring blood pressure. The role of nurses is currently also expanding in acute care and in assessing new patients. Nurses do not act as formal gate-keepers to the physicians, but in practice, seeing the nurse first is becoming a common route to a physician appointment. Maternal and child care are largely carried out by public health nurses who have specific training in preventive services. In addition to maternal and child health care, public health nurses are engaged in family planning, school health care, occupational health care, home nursing and all kinds of health promotion activities. 107

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Occupational health care at health centres is offered to those employees whose employers have elected to use the health centre to provide this service (see section 6.2). Occupational health care is provided by one or more of the health centre physicians, along with one or several nurses. The physician may be a specialist in occupational health care (which is a medical specialty in Finland) or have additional training in occupational health care (see section 2.2.4). Employers are charged the full cost of these services by the municipality. Physiotherapy and rehabilitation in health centres are carried out mainly by physiotherapists by referral from a health centre physician. They give treatment to individual patients and arrange guidance and physical exercise for patients. The health centre physiotherapy department is usually also the place that provides medical aids and prostheses. Health centres often employ social workers to deal with various problems related to illness, such as helping patients to apply for benefits or arranging home help and other services needed by patients discharged from inpatient care. Health centres also work in cooperation with municipal social services. Health centres also provide outpatient mental health care services (see section 6.9). Health centres do not have a pharmacy for the sale of prescription drugs to patients, but they have a stock of pharmaceuticals for their own use: for minor surgery, for inpatient departments and for acute cases at night when pharmacies are closed. The management of health centres varies. Usually, the head of a health centre is the chief physician, but in large and middle-sized centres the management often includes several leading persons. There are often several chief physicians accountable to the medical director, one or several chief nurses and one director of finance and/or administration. Some municipalities have a personal doctor system, which was developed in the 1980sâ&#x20AC;&#x201C;1990s. Currently, approximately half the physicians working in health centres belong to this system. In this system, a person or a family is assigned to a specific health centre doctor usually based on place of residence. Physicians organize their practice so that patients on their list are able to see them within three days. Physicians can decide on their own working hours, but not on the work of other personnel. Physicians in this scheme remain public employees. Collaboration between different health care personnel has been encouraged in this model: physicians and nurses form a team that is responsible for the care of a geographically defined area covering between 1500 and 5000 people. The teams have not been given special budgets or financial responsibilities. The reforms were made in order to improve access (every patient has a specified physician who has responsibility for access to them) and continuity of care (physicians do not change between visits). In some municipalities the size of 108

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the population covered is so small that the principle of a personal doctor system already exists without a specific system. As a rule, patients must use the health centre of their own municipality of residence, except in emergency situations. If a patient wants to make an appointment with a health centre physician, he or she is assigned either to the physician he or she wishes to see or to any physician who is available. If the “personal doctor” model is in use, the patient is usually assigned to the list of the doctor responsible for the care of his or her residential area. This means that there is not usually much choice of physician, as the initial assignment is based on address. However, if a patient wishes to change his or her personal doctor, this can usually be arranged. About 13% of physicians working in health centres in 2006 also worked in the private sector (Suomen Lääkäriliitto 2006) (see sections 6.2 and 3.3.2.2 for details on private primary care). In 2005 there were 1.7 patient contacts to health centre physicians and 3.0 contacts to other health centre personnel per inhabitant, excluding occupational health services (STAKES 2006b). In municipal specialist level care (hospital districts) there were 1.3 outpatient contacts to physician per person, in occupational health care there were 0.5 outpatient contacts and in private health care there were 0.7 outpatient contacts (part of which were specialist visits). The number of outpatient physician contacts per person in Finland is lower than the EU average (Fig. 6.1; in Finland this figure includes all outpatient physician contacts). In part this may be due to different medical traditions such as the important role played by nurses, midwives and public health nurses, who may carry out tasks that physicians in other countries may do, especially in the field of maternal and child health.

6.4 Secondary care Secondary care is mainly provided by the municipality-owned hospital districts (see section 2.2.1). There are 20 hospital districts in Finland. About 10% of specialist level outpatient visits are provided by health centres (STAKES 2006a) (see section 6.3). In 2006 there were 897 000 inpatient episodes, 179 000 periods of care in day surgery and 6.9 million specialist level outpatient physician visits in the municipal health care system (STAKES 2007d). In addition, there are private specialized ambulatory services and 41 private hospitals (the majority being very small) (STAKES 2006e). Each municipality must belong to one hospital district. The largest hospital district in terms of population base has over 1.4 million inhabitants, while the 109

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Fig. 6.1

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Outpatient contacts per person in the European Union, 2003 or latest available year (in parentheses) Czech Republic Hungary Slovakia (2004) Switzerland (1992) Spain (2003) Germany (2000) Slovenia Belgium Croatia Estonia (2004) Lithuania Austria (2001) France (1996) Italy (1999) Poland (2004) Romania United Kingdom (1998) Netherlands Bulgaria (1999) Latvia The former Yugoslav Republic of Macedonia Finland Denmark Portugal Norway (1991) Sweden (2003) Luxembourg (1998) Turkey (2001) Malta Cyprus Averages CIS average EU average (2004) EU15 (1999)

15.2 12.9 12.5 11.0 9.5 7.3 7.2 7.0 6.9 6.8 6.8 6.7 6.5 6.0 6.0 5.9 5.4 5.4 5.4 5.2 4.3 4.2 4.1 3.8 3.8 2.8 2.8 2.6 2.6 2.0 8.6 6.8 6.4 0

5 10 15 Contacts per person

Source: WHO Regional Office for Europe, June 2007. Notes: CIS: Commonwealth of Independent States; EU15: EU Member States before May 2004.

smallest has only 65 000. The number of member municipalities covered by the hospital district varies from 6 to 58. Each hospital district has a central hospital and other hospitals as needed, depending on the size of the hospital district. Five of the central hospitals are university teaching hospitals offering more demanding forms of specialized medical care and tertiary care. Hospital districts are funded by the member municipalities mainly based on fee-forservice (see section 3.5.1). The state owns two psychiatric hospitals, which are subordinate to STAKES. Physicians and other personnel in public hospitals are salaried employees of hospital districts. About 37% of physicians working in hospitals in the public sector also worked in the private sector in 2006 (Suomen Lääkäriliitto 2006) (see section 3.5.2). 110

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Hospital districts provide specialized outpatient care, inpatient care and day surgery, usually in the same facilities. Patients need a referral from their health centre physician or any other licensed physician in order to access the outpatient or inpatient department in a specialized care hospital, except in emergencies. It is estimated that about 5% of visits to a health centre doctor lead to a hospital referral (Puhakka et al. 2006). In 2005, about 39% of the referrals to inpatient care in hospital districts came from health centres (STAKES 2007b). Most of the remaining referrals came from other hospitals’ physicians (22%) and private physicians (15%, including private occupational health care). Day surgery has become a very important form of operation in specialist care. Day surgery is defined as specialist level operations that do not require patients to stay overnight in the hospital. Day surgeries increased from 77 000 to 171 000 between 1997 and 2006. In 2006, day surgeries represented 40% of all surgical procedures (compared with 19% in 1997) (STAKES 2007d). Over half of operations on the eyes, ears, nose, larynx and mouth are day surgery operations. In general, patients cannot choose the hospital where they will be treated (see section 2.4.2). Health centres have guidelines on where patients with certain symptoms and diagnoses are referred to. Primary and secondary care is not always well coordinated as there are usually separate organizations providing these services (i.e., health centres and hospital districts). For example, health centres are not always given sufficient feedback information about the treatment of patients after their referral to hospital. However, the general aim is to organize one coordinator of care, for example the personal doctor, to maintain an overall view and responsibility of patients when they are treated at different levels of the health system. The planned national electronic patient record system should help achieve this goal (see section 7.2.2). Also, at the local and regional level there have been numerous reforms aiming to increase the coordination between the primary and specialized care (see section 7.1.2.2). The issue of continuity of care has been raised in various national health policy documents, often expressed as a “seamless chain of care”. There are few private hospitals in Finland, providing only 5% of the hospital episodes of care in the country (STAKES 2007b). The main reasons for choosing a private hospital are shorter waiting times, the possibility to choose a physician, and the perception of better quality services. Also, patients do not need a referral for private hospitals, and NHI reimburses part of the expenses to the patient. Some municipalities and hospital districts purchase some specific services from private hospitals; however, this is not very common. There are also physicians’ private practices that provide specialized outpatient care services 111

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that are partly reimbursed by NHI. These private outpatient services are much more common than private inpatient care. In private health care facilities there were 3.5 million outpatient physician visits in 2006 (compensated by NHI), of which 79% were visits to specialists (SII 2007a). The specialties with the most private outpatient visits are gynaecology and ophthalmology, together making up more than one-third of the total specialist visits.

6.5 Emergency care Emergency care is provided by health centres and hospital districts. Normally, every health centre has at least one physician on call for emergencies. It is common that a large proportion of physiciansâ&#x20AC;&#x2122; work on call in health centres is not genuinely medically urgent as many times patients have difficulties in getting ordinary daytime appointments. This is especially the case in municipalities with physician shortages. Currently, it is very common to lease physicians from private firms for out-of-office hour care, so they are different physicians than those working during the day (see section 3.5.2.1). Normally, patients should first go to the health centre emergency care to receive a referral to hospital if needed. In hospitals there are several physicians of different specialties on call. The arrangement for emergency care differs greatly between hospital districts as their size varies considerably. Municipalities are responsible for arranging ambulance services. Provision of ambulance services differs between municipalities. Services can be provided by health centres, private companies and municipal fire departments. In the majority of municipalities the ambulance services are outsourced to private companies. There are more than 200 private companies providing ambulance services in Finland, the majority of them being small with less than three ambulances. NHI reimburses expenses exceeding out-of-pocket payment of 9.75 euros (in 2007) directly to the service provider when a patient arrives to a health care unit by ambulance (see section 3.2.2.3). NHI does not cover costs when patients are transported from one health care unit to another. In that case the service is paid for by one of the health care units. In 2005 NHI reimbursed 60 million euros for ambulance services, averaging 137 euros per trip (SII 2006). This is about half of the total expenses (Kuisma 2007), with the remainder paid by municipalities, hospital districts and patients as user-fees. It has been argued that the emergency care system is fragmented and a large proportion of municipalities have population bases that are too small to provide good quality and efficient services themselves (Kuisma 2007). Very few municipalities place any strict quality standards on the providers and 112

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in the majority of the municipalities, regulation of service provision is very weak. There are considerable regional differences in the service and cost levels that cannot be explained by differences in morbidity or regional characteristics but that are partly linked to different ways of organizing services. In 2007 there were six ambulance helicopters in Finland operating from Helsinki, Turku, Oulu, Varkaus, Sodankylä and Vaasa. These helicopters also operate other rescue missions. Ambulance helicopters are funded by private donations, hospital districts and the state.

6.6 Pharmaceutical care Pharmaceutical products may enter the market by permission of the NAM, which is subordinate to the MSAH. New drugs can also enter the market by the integrated European market authorization system (the European Medicines Evaluation Agency). The NAM also decides what plants are considered as medicinal. Herbal products containing these plants, or products made of them must usually have a marketing authorization as herbal medicinal products from the NAM. Finland is TRIPS (Trade-related Aspects of Intellectural Property Rights) compliant, and it was one of the last countries in western Europe to introduce product patents for pharmaceuticals (in 1995). However, process patents were granted before 1995. In 2007, there were very few pharmaceutical products in the Finnish market with a product patent as it takes about 10 years or more from patent application to market introduction. Although there is 10-year data exclusivity in Finland, it is somewhat easier to introduce generic products in Finland than most other European countries because of weaker patent protection. Historically, the Finnish pharmaceutical industry has made almost solely generic products. There are two wholesalers of pharmaceuticals in Finland that provide pharmaceuticals to pharmacies and hospitals. The pharmaceutical manufacturer makes a sole-distribution contract with the wholesaler and the products are available only through that wholesaler (so called one-channel system). Certain products may be delivered through an alternative route directly from the manufacturer to hospital pharmacies. The wholesalers and hospital pharmacies are obligated to maintain stocks for a possible crisis situation (for use for 5–10 months). Outpatient pharmaceuticals can be sold to patients only by pharmacies (including over-the-counter (OTC) drugs). The only exception is nicotine replacement products which have been sold by grocery stores since 2006. 113

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Prescription drugs are sold based on the prescription of a physician, a dentist or a veterinary surgeon. Health care units can provide drugs to patients which are administered in the health care unit. There are no Internet pharmacies in Finland. Pharmacies are privately owned by pharmacists, but they cannot be owned by companies. One pharmacist can run only one pharmacy (and possibly two subsidiary pharmacies). As an exemption, the University of Helsinki and University of Kuopio have special rights to own pharmacies. Hospitals have their own hospital pharmacies (there were 24 in 2006). In 2006 there were 804 pharmacies in Finland including subsidiary pharmacies (NAM 2007). Pharmacies are regulated in many ways. The NAM decides which locations pharmacies can be placed and also selects the pharmacists to run them. The PPB sets maximum wholesale prices for each pharmaceutical substance included in the drug reimbursement system of NHI. Wholesale prices must be the same for all outpatient pharmacies (this does not apply to hospital pharmacies). Companies can change the wholesale prices every two weeks. The retail price is determined by a combination of the wholesale price, the pharmacy’s profit margin (the rate is set by the Government) and VAT (see section 3.5.2.3). Pharmacies pay a tax-like graded pharmacy fee to the state depending on their net sales. The function of the pharmacy fee is to decrease the differences in income across pharmacies, but still there exist major differences in profits across pharmacies. Because of this strong regulation there is hardly any competition between pharmacies (MSAH 2007a). The average annual business profit for the pharmacist after reduction of other running costs was 280 000 euros in 2005 (9.2% of net sales). The PPB is attached to the MSAH. It regulates which drugs are reimbursed by NHI and their maximum wholesale prices. There are no restrictions on pricing of other drugs with a marketing licence. This price limit does not apply to hospital sales, because reimbursement of NHI applies only to outpatient drugs; drugs used in hospitals are paid from the hospital budget. There is no clawback system in Finland. Pharmaceutical companies holding sales permits have to apply for reimbursement and the maximum wholesale price from the PPB (see information on the drug reimbursement system in section 3.2.2.2). The majority of prescription pharmaceutical products which have a marketing licence are reimbursed. There are three main categories of drugs that are not reimbursed: low cost drugs in which reimbursement is not considered important for patients, and to which companies want to freely set the price; where the PPB and the drug company have not reached an agreement on what is a reasonable price; and where the drug is used solely in hospitals. 114

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A pharmaceutical company is free to set the wholesale price lower than that which is determined by the PPB to be reasonable. Compulsory generic substitution was introduced in Finland in 2003 (voluntary generic substitution was in effect for a few years in the early 1990s without significant success). According to law (the Medicines Act), pharmacies are obliged to substitute a prescribed medicinal product that costs more than a certain defined maximum price limit with a product costing less than that limit containing the same substance. The NAM defines the list of substitutable medicinal substances. The majority of drugs are in this list, but, for example, insulin and anti-epileptics are not included. The price limits for generic substitution for each pharmaceutical substance are defined every three months by the SII. The SII calculates the maximum price by adding two euros to the price of the cheapest alternative at that moment (and 3 euros if the price of the drug is more than 40 euros). The prescribing physician may decline generic substitution for medical or therapeutic reasons. The patient does not need any reason in order to decline substitution and he or she is refunded by the NHI according to the actual costs of the prescription. Historically there has been no reference pricing system in Finland, although MSAH has planned to introduce it in 2008. Physicians rarely decline substitution and patients refuse only about 10% of the potentially substitutable prescriptions. Annual savings from the first year of generic substitution was about 5% of outpatient drug expenses, of which about twothirds has been attributed to price competition (Ahonen and Martikainen 2005). Price competition continued to lower prices after the first year (Paldán 2006). Hospitals and health centres usually have pharmaceutical boards which are expert bodies evaluating and recommending medicines to be approved for entry into the drug formulary. The drug formulary is intended to ensure safe and effective pharmacotherapy for medicines regularly needed in hospitals (Hermanson et al. 2001; Pekurinen and Häkkinen 2005). These boards also negotiate medicine prices and decide on procurement. Hospitals and health centres have also formed purchasing pools to strengthen their negotiation power. As in many other European countries, expenditure on pharmaceuticals has grown rapidly, both in real terms and as a share of total expenditure (see section 3.1). From the beginning of the 1990s, pharmaceutical costs grew on average 7–8% every year in Finland (Pekurinen and Häkkinen 2005). In 2006 total sales including inpatient and outpatient use were 2.4 billion euros and about 470 euros per inhabitant (NAM 2007). In 2005 total sales of pharmaceuticals was 20.5% of total health care expenditure (compared to 15.4% in 1994). Of the total sales, 74% was attributable to prescription medicines used in outpatient care, 115

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16% to medicines used in inpatient care and 10% to OTC medicines in 2006. The NHI reimbursed a total of 1.1 billion euros for outpatient drugs. Between 2005 and 2006 the total sales of pharmaceuticals decreased (by 1.6%) for the first time in Finland in the last two decades. The price decrease in early 2006 and the effects of generic substitution were the principal factors contributing to this (see section 7.1.1.4). Direct-to-consumer advertising of prescription drugs is not allowed in Finland. However, disease-oriented advertisements not specifying drugs are permitted. On the Internet, only text containing patient information can be presented. Direct-to-consumer advertising of OTC drugs is permitted, but regulated. The NAM and Pharmaceutical Industry Finland (a national industry association) enforce regulations concerning drug promotion to the public and to health care professionals. Rohto was established in 2003 to develop pharmacotherapy in Finland by disseminating independent drug information to physicians. The SII annually sends a letter to physicians reporting on the expenses for the drugs that particular physicians had prescribed in the last year and, for comparison, the average expenses of all physicians of the same specialty (Pekurinen and HĂ¤kkinen 2005). Prescribing is also guided by Current Care, which are guidelines produced by the Finnish Medical Society Duodecim. However, with very few exceptions these guidelines do not include economic information (see section 7.1.1.6). In outpatient care physicians do not have any financial incentives, such as holding a budget to assess costs, and NHI as a payer has few possibilities to directly influence physicians. However, prescription patterns can be somewhat regulated by limiting reimbursement. For example, in 2006 the PPB decided that the most expensive statins would only be reimbursed after less expensive statins are first tried and found to be inadequate. This significantly lowered the use of statins without a generic alternative, although it appears physicians do not follow this rule consistently for all patients (Martikainen and Maljanen 2007). In inpatient care, physicians need to assess costs more closely as expenditures are included in the departmental budget. Pharmaceutical policy in Finland is currently under review and a report about it was published in 2008 (Mossialos and Srivastava 2008).

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6.7 Rehabilitation Health centres and hospital districts provide medical rehabilitation in the form of rehabilitation counselling, tests to establish the individual’s need for rehabilitation, treatment and course of rehabilitation to improve functional and working capacity, the provision of various technical aids, adaptation training and rehabilitation guidance. Rehabilitation is provided in cooperation with the health centre and other agencies such as social welfare offices, employment offices, schools, the SII and insurance companies. Rehabilitation coordination in the municipalities is often provided by a special liaison team. In addition to municipal services, the NHI also reimburses part of the cost of medically prescribed private rehabilitation services (see section 3.2.2.3) (covering 106 000 persons in 2006; SII 2007c). NHI covers vocational rehabilitation for persons with impaired functional capacity and medical rehabilitation of persons with severe disabilities. The state budget also includes a special allocation that the NHI can use to reimburse other vocational services, including early rehabilitation measures geared to the requirements of a particular occupation, institutional rehabilitation services, adaptation training and psychotherapy.

6.8 Long-term care Long-term care for older people is mainly provided in the inpatient departments of health centres, in nursing homes and in service homes. The majority of nursing and service homes for older people are owned by municipalities, but there are also a number of private homes and homes provided by NGOs. Other long-term care services for older people and people with disabilities include home-care services, home nursing, day hospitals and other day-care centres and part-day nursing. In service homes, older and disabled people live in their own apartments but are offered different kinds of service in the same building, such as meals, nursing, alarming system and other assistance with daily living. Health centres have to work closely with municipal nursing homes; for example, a health centre physician takes care of the medical treatment once or twice a week. In 2005, 12% of over 75 year-olds were in regular home-care, 5% in service homes (of which little more than half had 24-hour assistance), 4% in nursing homes and 3% in long-stay care in inpatient wards of the health centres (STAKES 2006b). Long-term inpatient care at health centres has somewhat decreased since 1990. From the early 1990s, the volume of traditional nursing homes has decreased and the volume of service housing living has 117

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increased. This development has been prompted by financial incentives for the municipality. In service homes, the terms are similar to ordinary living with the help of community-based services and, for example, drug costs are covered by NHI and not by the municipality as would be the case in a nursing home. Various health and social policy documents have stressed the need for more support for older people and people with disabilities living in their own homes. As a result, an effort has been made to improve the supply of home support services offered. There is considerable variation across municipalities in the type of services provided and in some municipalities there have been concerns that the level of quality in nursing homes is poor. To address this situation national quality guidelines for elderly care were published by the MSAH in 2001 to help municipalities monitor their attainment of a set of targets for elderly care (MSAH 2001b). The quality guidelines, for example, recommend that municipalities should define the number or ratio of personnel per client needed for each service. However, the targets are recommendations rather than rules. Persons with other disabilities are also offered special residential services and other services by municipalities. Legislation requires that disability services must be provided according to need in a municipality, and that people with disabilities have a right to certain services. In 2005 there were 2500 persons (0.5 per 1000 inhabitants) in institutions for people with intellectual disabilities, 7500 (1.4) in housing with assistance, 1900 (0.4) in sheltered and supported housing and 2800 (0.5) in service housing for seriously disabled people (STAKES 2006b). Since the mid-1990s, there has been an increase in housing with assistance and service housing for seriously disabled people alongside a decrease in the number of persons in institutions for intellectual disabilities.

6.9 Mental health care Municipalities are responsible for providing mental health care services to their inhabitants; mental health is one of the task areas of the health centres according to the law (Primary Health Care Act). There is also a special act on mental health services (Mental Health Act) enacted in 1991, in which for example, rules on coercive measures are defined. In the 1970s and 1980s curative mental health outpatient services were under the administration of specialist level services, but health centres were funded to employ psychologists for preventive mental health services. These psychologists directed their work to children, schools, special risk groups, or they offered office-based services for common life crisis situations. 118

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Later, mental health services were actively shifted away from the hospital to the community. During the 1990s, gradually a significant proportion of mental health services were transferred under the administrative roofs of health centres in most hospital districts and many long-term patients were transferred from institutionalized care to outpatient care and to transitional services such as supported housing. During this time the average length of treatment periods in inpatient care decreased significantly. However, partly because of economic recession, the supply of outpatient psychiatric services as well as other supportive services and intermediate services has not increased to the same extent as hospital beds had been reduced (Lehtinen et al. 2006). There was also greater emphasis placed on public health in this period. Because of the high suicide rate (see section 1.5), the national administration carried out a suicide prevention programme during the years 1986-96. The programme, led by KTL, included a research project on suicide risk factors and an action plan based on the findings. The successful implementation of the action plan involved the extensive participation of stakeholders from national, provincial and municipal levels and may have contributed to the reduction in suicide mortality in Finland over the last twenty years. In 2006 there were about 73 000 episodes of inpatient mental health care and 2.1 million inpatient care days (2.5 million in 1996) (STAKES 2007d). That same year there were 1.4 million outpatient mental health visits in hospital districts (1.2 million in 1995) and 650 000 outpatient mental health visits in health centres (215 000 in 1995). In 2006 there were 217 child psychiatrists, 132 adolescent psychiatrists, 46 forensic psychiatrists and 977 adult psychiatrists (Suomen Lääkäriliitto 2006). Institutional care is provided in the psychiatric units of hospitals. Some units are physically located in general hospitals and some are separate psychiatric hospitals governed by hospital districts. Finland has two state-owned psychiatric hospitals that provide mental health examinations and treatment for criminals waived prosecution for mental disorders, and other patients whose care is considered dangerous or particularly complex. Outpatient services are provided by health centres, mental health offices and psychiatric hospital outpatient departments. Mental health offices are staffed by psychiatrists, psychologists, psychiatric nurses and social workers, among other professionals. Many mental health offices have been transferred to the administration of health centres but there has been no systematic national policy to do so. The overall picture is quite variable across the country in this respect. Outpatient services supporting long-term psychiatric patients consist of residential homes, rehabilitation homes, shared apartments, day hospitals and 119

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day-care centres, and sheltered housing. The organizations providing these services vary from region to region; from the municipal social or health service system, the private sector or NGOs, to specialized psychiatric hospitals. The SII reimburses part of the private psychotherapy fees incurred by over16s who are threatened by incapacity to work or study, or who are unable to return to employment or studies without the support of psychotherapy. In the case of the under-16s, the SII places importance on organizing and funding a diversity of family-oriented rehabilitation.

6.10 Dental care The population can access public dental services in municipal health centres or alternatively they can use private services. Private dental care is partly reimbursed by the NHI with the exception of orthodontic or prosthetic treatments. From the early 1970s onwards, when the Primary Health Care Act came into force, regular dental check-ups for children and adolescents were provided by health centres. In the 1980s this programme covered about 80% of children and adolescents (Nordblad et al. 2004). In the 1990s the length of time between check-ups was extended from one year to two years. During this period public financing of other dental services was very limited. Gradually, municipal dental services expanded to other population groups. By 2001, all children, adults born in or after 1956, veterans of the Second World War and adults with certain illnesses had access to municipal services or were reimbursed for private dental services. From December 2002 the age limits regulating access to municipal services or reimbursement of private dental services were abolished altogether. Before the reform there were significant local and regional variations in the dental care provided by health centres. Some municipalities managed to offer dental care to their whole population, while others offered fewer services than those defined in the legislation. In general, regular examinations of the child population including preventive dental care and orthodontics, and care of younger adults and some special groups were top priority in municipal services. Private services were concentrated in densely populated areas. Following the 2002 reform the use of municipal dental services increased and the number of persons receiving reimbursement for the cost of private care doubled (see section 7.1.1.5). However, some municipalities, mostly larger cities with a substantial private sector, have still had difficulties meeting the demand for dental care and waiting lists have become long. 120

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In 2006 there were 4.9 million dental visits to the municipal dental services, of which 3.9 million were made to dentists and the remainder to dental hygienists and dental nurses (STAKES 2007d). Approximately 41% of dentist visits in 2006 were made by under-18 year-olds. At the same time there were 2.8 million visits to private dentists of which 3% were visits by under-24 yearolds according to reimbursement statistics (SII 2007c). In relative terms, use of private services by adults is much more common in dental care than in the field of general medicine.

6.11 Health care for specific populations Municipalities provide health care services in primary schools, training colleges and high schools. Primary school health care includes medical examinations by a physician or nurse, health education, dental care, in addition to psychological and speech therapy services. Pupils are examined by a physician on two or three occasions, and other check-ups are carried out by a school nurse. Pupils can also visit a school nurse when needed. The nurse is also responsible for matters related to health education and the overall health care of pupils. In many schools the school nurse holds classes on relationships and sex education. The University Healthcare Foundation founded in 1954 is responsible for providing health care for 140Â 000 university students (including preventive health care, medical care, mental health care and dental care). The Foundation has 16 health centres in university cities. In 2006 its budget was 35 million euros which is financed by NHI (65%), the students and student unions (18%), the university cities (12%) and the Ministry of Education (5%). There are special health care services for armed forces and prisoners. In every prison there is an outpatient clinic and in addition there are three prison hospitals (one of which is a psychiatric hospital). Health care for prisoners is funded by the Ministry of Justice. For conscripts, the armed forces must provide full health care services free at the point of use. Until 2006 the armed forces Central Military Hospital provided specialized health care services, but since then these services have been contracted to hospital districts. For primary health care services the armed forces have 25 health centres within garrisons. For employed staff of military forces, health care services are arranged under the Occupational Health Care Act. According to the Act on Adaptation of Immigrants and Reception of Asylum Seekers, asylum seekers are entitled to the same health services as permanent residents. These services must be organized by reception centres for refugees. 121

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7. Principal health care reforms

he long-term objectives of Finnish health policy are to achieve the best possible health of the population and to reduce disparities in health across social groups. Until the 1970s, policy issues that concerned the health care delivery system had been mainly focused on employing the increased resources to develop the system and improving accessibility to services. The introduction of the Primary Health Care Act at the beginning of the 1970s formed the basis for the further development of the health care system and health policy in Finland. In the 1980s public health policy became particularly important (see section 6.1.1). The WHO Health for All programme contributed significantly to Finnish health policy. In the 1990s, developments in health care were influenced by “external” circumstances: severe economic recession, the 1993 state subsidy reform and Finland’s membership of the EU. The recent aim of Finnish health policy has been to reduce hospital and other kinds of institutionalized care and to expand outpatient and home care services. The growing number of older persons, together with pressure for cost containment, has also influenced this emphasis on outpatient care. While there has been no major reform of the health care system in Finland during the period 1997 to 2007, there have been a number of changes addressing specific issues. The most important reforms since 1995 are described in Table 7.1. Some of the earlier reforms are described in section 2.1.

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Table 7.1 Year 1995 1995 1998 1999 2000 2002 2002 2003 2003 2005 2005 2007

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Major health care reforms and policy measures, 1995–2007 Event Founding of Finohta Beginning of the Current Care Guidelines project Economic evaluation of new drugs introduced Limited 42% reimbursement category for certain drugs introduced Internet portal Terveysportti set up National Project to Ensure the Future of Health Care launched Extension of public dental health care to all age groups Compulsory generic substitution of pharmaceuticals introduced The Centre for Pharmacotherapy Development (Rohoto) established Maximum waiting times defined Project to restructure municipalities and services launched Decision made on national electronic prescription and patient record systems

Note: Finohta: Finnish Office for Health Technology Assessment.

7.1 Analysis of recent reforms 7.1.1 National measures and development projects 7.1.1.1 State level four-year plans When a new Government is appointed it draws up a social welfare and health care programme for the next four years. The aim is that the Government, municipalities and other actors in the field of social welfare and health work towards the achievement of common targets, based on the Government programme (see section 7.2). These targets and development recommendations apply primarily to the municipalities, but the programme includes also recommendations for measures through which the state can support the municipalities in reaching their targets. Before 2007 this programme was called the Social Welfare and Health Care Target and Action Plan. In January 2007 Parliament reformed legislation in this respect (change of the Act on Social and Health Service Planning and State Subsidy) and the plan was replaced by the National Development Programme for Social Welfare and Health Care. The objective of the reform was to strengthen the steering function of the programme, for example by integrating the state funding of local development projects into the programme (see section 4.1.1). The Target and Action Plan for 2000 to 2003 emphasized the importance of prevention. The main objective of the plan was to increase cooperation between different sectors of society and between municipalities. Further, the plan emphasized the importance of ensuring there are sufficient staff with the appropriate skills within the social welfare and health care services. Particular 124

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attention was paid to the health and social welfare of children, older people and people with mental health problems. The Target and Action Plan for 2004 to 2007 was issued in December 2003. It included 75 different recommendations for action. The main goals for health care in the action plan were to improve access to care (especially to dental care), to reduce the differences in care provision between municipalities, to develop maternal and child health services, to reduce alcohol-related health problems and to improve the prevention of mental health problems. The current Government was appointed in April 2007 and the first National Development Programme for Social Welfare and Health Care was accepted in January 2008. The central theme of the programme is to strengthen the development activities of municipal services. The main targets of the programme are to decrease marginalization of vulnerable people; increase overall levels of, and decrease inequalities in, health and welfare; and increase quality, effectiveness and accessibility of services and decrease geographical differences therein. The main actions defined in the programme are to strengthen promotion of health and well-being; to secure sufficient human resources for services; to increase competence of personnel; to strengthen the position of users of services (patient empowerment); to reform the organization of services; to create a good practices network; to strengthen primary care services; and to further develop national quality guidelines (MSAH 2008b). 7.1.1.2 Securing the future of health care In 2001 the Government initiated the National Project to Ensure the Future of Health Care proposed by the Prime Minister and the Minister of Social and Health Services at the time. The project aimed to solve a variety of deficiencies identified in the Finnish health care system. The preliminary work of the project was divided between five working groups focusing on the following areas: • the reform of the operational and administrative structures of the delivery system and improvement in efficiency and productivity; • the need for an increased labour force, division of duties, and the improvement of working conditions and improved continuous medical education; • increasing the level and stability of health care financing and sources of finance and the improvement of steering mechanisms; • the development of the division of labour and cooperation between public health care, private health care and NGOs; and • the consolidation of treatment practices and improvement of access to treatment. 125

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The main outcome of the above project was the working group memorandum and “the Decision in Principle by the Council of State on Securing the Future of Health Care” issued by the Government in April 2002 (MSAH 2002). It focused on strengthening primary health care and preventive work, ensuring access to treatment, ensuring the availability and expertise of personnel, reforming of functions and structures and augmenting the finances of health care. The final action plan of the project included the following proposals: • to increase state level funding of health care services; • to embody the principle of access to treatment within a reasonable period in legislation by 2005 (see section 7.1.1.3); • to allocate funds for developing the service system (30 million euros annually); • to allocate funds for the current care guidelines project (1.4 million euros annually; see section 7.1.1.6); • to establish a centre for rational pharmacotherapy (1.3 million euros annually; see section 7.1.1.4); • to increase funding of Finohta (see section 7.1.1.6); • to increase the number of people educated for health care professions; and • to develop the division of labour within specialized medical care. A working group was set up by the MSAH to propose an implementation plan for the decision. The project has continued following the path set by the memorandum and the decision in principle. It has produced many reports and arranged several seminars. It has also distributed funding for local development projects. However, the overall impact of the project has been rather modest. The most visible reform has been the waiting time guarantee and founding of Rohto. Improvement has also occurred, for example, in the increase of students trained as health professionals, in developing the division of duties among health professions, in development of information technology and in strengthening continuous medical training. More detailed description of some of the reforms initiated by this process is presented in the following sections. The final report of the monitoring group of the project was published in February 2008 (MSAH 2008a). 7.1.1.3 Ensuring access to care As in most countries, one major challenge in the health care system in Finland has been the gap between available resources and increasing demand for health care services. This discrepancy has generated long waiting times for certain services in ambulatory and hospital care. There have also been considerable differences in waiting times between municipalities. The Decision in Principle 126

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by the Council of State on Securing the Future of Health Care issued by the Government in 2002 (MSAH 2002) stated that the principle of access to treatment within a reasonable period would be embodied in legislation by the year 2005 (Vuorenkoski 2006b; Vuorenkoski and Keskimäki 2004). According to the decision, in principle patients must be assured immediate contact with their health centre, and their need for care must be assessed by a health care professional (not necessarily a physician) within a maximum of three weekdays after their contact with the health centre. In non-acute specialized medical care, it is the responsibility of the hospital district that the patient’s need for care is assessed within a maximum of three weeks after receiving a referral, and any necessary medical care must be provided within three months, or at the very latest, six months. If the treatment cannot be provided within the time specified, treatment must be procured from another service provider at no extra charge to the patient. In 2004 the MSAH put together national guidelines defining the limits of access to non-urgent specialized care procedures based on expert proposals. The guidelines were made for 193 diseases or treatment groups comprising about 80% of non-emergency hospital care. The guidelines define which patients should receive the treatment guarantee, but they are not legally binding. Scoring systems are used in some of these guidelines. In March 2007, 87% of health centres reported that they used these guidelines. A change to the legislation (Primary Health Care Act and Act on Specialized Medical Care) containing these proposals came into force in March 2005. The legislative reform has had a significant positive impact in reducing waiting times, although some municipalities and hospital districts still fail to comply with the legislation. In April 2008, 62% of the population lived in municipalities not experiencing problems in obtaining immediate contact to primary health care (up from 37% in January 2005), and 95% of the population lived in municipalities where the assessment of the need of care by a public health care professional was provided within the enacted maximum of three weekdays in primary health care (up from 49% in January 2005). In December 2007, the number of patients who had waited more than six months for a specialized health care operation was 9700 (compared to 66 000 in October 2002 and 41 000 in January 2005). New legislation did not define the maximum waiting time for a physician appointment (the legislation refers to a “health care professional”) in non-acute cases, but this has improved somewhat also: in April 2008, 37% of the population lived in municipalities where patients did not have to wait more than two weeks for a physician appointment in non-acute cases (25% in September 2005). 127

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7.1.1.4 Pharmaceuticals The Government has long been concerned about the problem of increasing pharmaceutical expenditure and has introduced several measures to address this. However, no effective solution with long-term effects has been found. Pharmaceutical policy in Finland is currently under review and a report was published in 2008 (Mossialos and Srivastava 2008). The most important reforms from the past 10 years are described below. As of 1998, a holder of a sales permit applying for inclusion of a drug in the reimbursement scheme is required to carry out an economic evaluation and present it to the PPB as part of the application. However, the quality of these evaluations has been rather poor and of little value to the decision-making process. In 1999, a category of significant and expensive drugs was introduced in the drug reimbursement system. Drugs in this group have 42% reimbursement only if the illness of the patient fulfils certain criteria. For example, expensive drugs for treating erectile dysfunction (for strictly medical reasons), MS-disease and Alzheimer’s disease were included in this group. Rohto was established in 2003 to deal with the independent assessment of drugs and the dissemination of such information to develop pharmacotherapy in Finland. The implementation of treatment guidelines and other evidence-based knowledge in practice is the main goal for the agency’s training activities and information dissemination. The agency does not compile its own treatment guidelines, but uses existing treatment guidelines from Finland and other countries. Voluntary generic substitution was in effect for a few years in the early 1990s without significant success. Compulsory generic substitution was introduced in Finland in 2003. According to the legislation (Medicines Act), pharmacies are obliged to substitute a prescribed medicinal product that costs more than the defined maximum price limit with a product costing less than that limit containing the same substance. The prescribing doctor may forbid generic substitution for medical reasons. The patient does not need any reason in order to refuse substitution and she or he is refunded by the NHI according to the actual costs of the prescription (see section 6.6). Generic substitution appears to have significantly lowered pharmaceutical expenses and thus has been considered to be very successful. However, after the successful start of generic substitution pharmaceutical companies started lobbying the MSAH to restrict the list of substitutable drugs. They argued that in the worst cases they are not able to introduce drugs to the Finnish market and they also claim that the situation may restrict their research and development activities in Finland. Because of this drugs without 128

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a product patent but with a process patent in Finland and with product patents in five European countries were excluded from generic substitution in 2006 (Finland has somewhat weaker patent protection of pharmaceuticals than other EU countries in general; see section 6.6). Because of this generic substitution is not currently as effective as it could be. In 2006 two other important measures concerning pharmaceuticals were taken. Firstly, maximum wholesale prices were decreased by law by 5% at the start of 2006 (the Sickness Insurance Act). In practice this lowered the prices only of drugs which are sold at the maximum price set by the PPB. Generic products are usually already sold at much lower prices than the maximum and the reform therefore did not influence those prices. Nevertheless, partly as a result of this reform total pharmaceutical expenditure decreased by 1.6% between the years 2005 and 2006 (in the year before expenditure had increased by 6.7%). Secondly, as a result of a change in the legislation (Medicines Act), the sale of nicotine replacement products was allowed for shops, kiosks and gasoline stations (only those in which tobacco products are also sold). The reform decreased prices of these products by 15% on average and considerably increased their availability. 7.1.1.5 Dental Care Publicly funded dental care was offered to the whole population from December 2002 onwards (KeskimĂ¤ki 2003b). The reform is based on the legal amendments passed in 2000, which extended public funding from those born in 1956 or later to all age groups (Primary Health Care Act, Act on Specialized Medical Care and the Sickness Insurance Act ). This reform concerned both public dental services and the NHI reimbursement of private dental services. However, prosthetic and orthodontic services, and technical works are not publicly provided or refunded by NHI except in cases when they are offered due to other diseases. Besides socioeconomic equity, a major objective of the reform was to equalize municipal differences in the coverage of dental services. Before the reform, one third of the Finnish population lived in municipalities providing dental services for all age groups in their health centres, and one third lived in municipalities providing public services for those born in 1956 or later which was stated as a minimum in the legislation. Due to vague wording of the law, several, mainly urban, municipalities with the remaining third of the population had more strictly limited the age groups for whom they provided dental services. According to the reformed legislation, municipalities are obliged to provide basic dental services for all their inhabitants. The municipalities can provide 129

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services themselves or contract them out to other municipalities or private providers. Persons using private dental services are eligible to be refunded by NHI. The reform for expanding NHI coverage was accepted already in the 1991 amendment of the Sickness Insurance Act, but the enforcement of the legislation was temporarily postponed several times due to economic reasons. The increased expenditure of municipalities due to the reform is partly compensated by higher state subsidies. After the reform the use of municipal dental services increased and the number of persons receiving reimbursement for the cost of private care doubled (Widström 2006). The proportion of adults using municipal dental services increased from 22% to 24% and those receiving reimbursements for private dental care increased from 12% to 25% between 2000 and 2004. At the same time dental care expenses increased by 12% (STAKES 2007a). However, larger cities with little tradition of treating adults in public dental services have had difficulties supplying the services and queues have become long. A number of municipalities have had serious difficulties in carrying out the reform. A shortage in dentists is one important obstacle in the implementation of this reform, which is being addressed partly by the delegation of tasks from dentists to dental hygienists. 7.1.1.6 Information for clinical and administrative decision-making In 1995, an independent centre for HTA, known as Finohta, was established within STAKES. The centre’s main objective is to promote evidence-based medicine and to improve the effectiveness and cost-effectiveness of care (mainly non-drug diagnostic or treatment methods). Finohta coordinates HTA research, disseminates information and gives methodological and financial support to research projects aiming at evaluating the clinical effectiveness or cost-effectiveness of a given health technology. The majority of the funding for Finohta comes from the state. As a result of the decisions that were made based on the National Project to Ensure the Future of Health Care, the annual state funding of Finohta has doubled from 1.1 million to 2.2 million euros between 2004 and 2007. In 1995, the first Current Care Guidelines were made by the Finnish Medical Society Duodecim and various medical specialty associations. Since then the work has continued with increasing resources. The guidelines are devised in working groups in which Finnish experts of a particular field are selected. The guideline development process follows the principles of evidence-based health care, and recommendations are graded according to the level of evidence. The draft guidelines are widely circulated to relevant stakeholders for comments and are then reviewed. By June 2007 guidelines had been developed for 76 130

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different diseases and conditions. The guidelines are meant to be updated every two or three years. The guidelines are primarily intended for clinical practitioners, but they are also used for developing local care programmes and care pathways. The secretariat of Current Care Guidelines is situated in the Finnish Medical Society Duodecim. For the period 2003 to 2007 the MSAH allocated 1.4 million euros yearly from the funds of the Finnish Slot Machine Association for the development of these guidelines. In 2000, the Finnish Medical Society Duodecim opened the Internet portal Terveysportti (Health Portal) for health care professionals. From the portal health care professionals can access, for example, EBM guidelines, the Current Care Guidelines, short product characteristics and prices of pharmaceuticals sold in Finland, the Cochrane Library, several leading international medical journals, ICD-10 codes, the drug interaction database, the comprehensive Finnish Medical Terms book and two leading Finnish medical journals. Almost all municipalities and hospital districts have purchased this service for their employees. It has been rather successful having on average 35 000 front page openings per day in 2006. 7.1.1.7 Information technology The development of health care information systems has been pronouncedly uncoordinated partly because of a very decentralized health care system. This has resulted in a situation where non-interoperable information systems are used even within individual health care organizations. To promote the utilization of information technology the MSAH launched the MacroPilot project in 1999. The objective of MacroPilot was to develop social welfare and health care services, in particular to produce clientoriented seamless service chains and to develop and test relevant information technologies. Among other things the goal of the project was to create a preliminary technical framework for a regional information system. However, the project did not meet its goals in terms of the development of information technology. The objectives of the MacroPilot were too broad with regard to the period of time reserved for the project, and the development of the social welfare and health service system with focus on information technology proved to be a slower process than had been expected. A major milestone in the development of information technology was achieved in December 2006 when the Parliament accepted new legislation on the electronic prescription database and the patient record database (Act on Electronic Prescription and Act on Electronic Management of Information on Users of Social and Health Services) (see section 7.2.2). According to the acts new electronic databases will be maintained by the SII. All service providers 131

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are obliged to join these systems and they should be fully functional after a four-year transition period in 2011. 7.1.1.8 Project to restructure municipalities and services The project to restructure municipalities and services was first introduced in February 2005 as one solution to the problems of municipalities’ increasing financial difficulties and the future impacts of the ageing population in the future (Järvelin and Pekurinen 2006). The ageing population will reduce the availability of the workforce as a significant number of personnel within social and health services will retire in the next decade or so, and at the same time, it will increase the need for health care professionals. The purpose of the planned public sector reform is to create a firm structural and financial basis within municipal services so that the organization and provision of services will be secured in the future. At the same time, quality, effectiveness, availability, efficiency and technological change of services are taken into consideration. The project concerns all services organized by municipalities, not only health care services. After extensive discussion with relevant actors, the Parliament passed an act on how to continue the process in January 2007 (see section 7.2.1). 7.1.1.9 Policy programme for health promotion In 2007, the Government initiated a new four-year multisectoral Government programme entitled the “policy programme for health promotion”. The objectives of the health-promotion programme are to improve the general state of health of the population and to reduce health inequalities. The policy programme continues with efforts to promote health and prevent health hazards beyond conventional administrative boundaries. Issues to be addressed in the context of the programme will include developing measures to promote health and related legislation, promote the well-being of children and youth, improve the health, functional capacity and workplace welfare of people of working age, promote the health and functional capacity of older people, assign responsibility for preventive efforts and allocate related resources, stress the importance of physical activity and culture for well-being and increase the health of the environment. 7.1.2 Local development projects A marked feature of recent structural developments in the municipal health care system is the emergence of a number of local projects and experiments around the country. These reforms could be roughly divided into three different types: 132

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enhancing regional cooperation between municipalities; integration of primary health care and specialized health care; and cooperation with the private sector. Currently, these local projects are an integral part of the national project to restructure municipalities and services (see section 7.2.1). 7.1.2.1 Regional cooperation The underlying aim of enhanced regional cooperation is to increase efficiency. Recent mergers of administrative units in Finland took place at different levels of the health care system (i.e. municipalities and hospital districts) and in diverse areas (information technology, secondary care and primary health care). Some examples of these reforms are described below. In the capital, Helsinki, a new hospital district (known as ‘HUS’) was formed in 2000 by merging two hospital districts in the capital area (Helsinki and Uusimaa) and the Helsinki University Central Hospital. The new HUS covers a population of 1.4 million which is about 27% of the Finnish population. The member municipalities vary from the capital to the small rural municipalities. The goal was to merge two geographically proximate hospital districts and the Central University Hospital of Helsinki in order to achieve more effective organization and to avoid the duplication of services. However, it has been found that old structures are hard to change rapidly in an organization of this size. Since 1972 when the Primary Health Care Act was brought in, some municipalities have merged to provide primary health care services. Recently there have been an increasing number of mergers. For example, six municipalities in north-west Finland formed the “Siikalatva Health Service District” in 2005 by uniting their health centres under one administration. The new organization provides primary health care services for the municipalities but specialized health care services are still purchased separately by every municipality from hospital districts. These six municipalities have a total of 16 500 inhabitants. Regional data systems for sharing patient information were created, for example, in the Pirkanmaa and Satakunta hospital districts. Since the year 2004, Pirkanmaa hospital district has had a regional data system providing the hospital district access to electronic patient records of health centres from seven member municipalities. In Satakunta, the hospital district and health centres initiated a project (Salpa project) that aims to provide health centres with access to patients records from the hospital district. The second target of the Salpa project is to provide hospital districts with access to patient records from health centres. The hospital districts of Etelä-Karjala and Kymeenlaakso have a similar joint project (KAAPO).

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There have been many other projects to improve regional cooperation, for example primary health care call centre services, pharmacy services for health care units, ambulance services and radiological imaging services. 7.1.2.2 Integrating primary and specialized health care Several local reforms have been conducted to improve cooperation between primary and secondary health care and social welfare services by integrating organizations (Vuorenkoski and Mikkola 2007). These reforms are also meant to promote cooperation between small neighbouring municipalities and to create a better structural and financial basis for the provision of municipal health services. This development is further endorsed by a national project to restructure municipalities and services (see section 7.2.1). In addition, to lower the barriers between primary and specialist health care and improve cooperation, the Government plans to combine the Primary Health Care Act and the Act on Specialized Medical Care into a comprehensive Health Care Act. These reforms are controversial because of the diminishing power of single municipalities and the shifting of power relations between primary and secondary services. Separate organizational structures for primary and secondary care negatively influence the extent of cooperation between these levels of care. This separation can hinder the optimal organization of care from both clinical and economic perspectives. For example, transmitting patient records and other information between primary and secondary care can be difficult. The separation of organizations can also lead to a situation where primary health care is in too weak a position as regards resource allocation, since when faced with difficult financial situations municipalities are better able to limit health centre costs than the hospital districts. The most innovative reform of this type is the new administrative pilot in the Kainuu region (north-east Finland), started in 2005. It covers nine municipalities having a total of 85 000 inhabitants (Keskimäki 2003a). The experiment created a new regional self-regulating mid-level administrative body with its own regional council elected for a four-year term at the same time as the general municipal councillors’ election. The new administrative body cannot levy taxes but receives funding from municipalities. It is responsible for several welfare services that were previously run by the municipalities: upper secondary schools and vocational education, primary health services, specialized health care, and a large part of social services. In this pilot, provision of primary health care and specialized health care (municipal health centres and Kainuu central hospital) were merged into the same organization. Among other things, this has provided the possibility to unify electronic patient record systems. 134

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Two of the most recent reforms of this type were in the Itä-Savo and Päijät-Häme regions (Vuorenkoski and Wiili-Peltola 2007). In both regions municipalities formed new organizations to provide primary and secondary care and social services (since January 2007). The new organizations replaced hospital districts that had provided only secondary medical services. Like hospital districts the new organizations are municipal federations governed and funded by member municipalities. The Itä-Savo district, located in eastern Finland, has nine municipalities and a total population base of 60 000. One of the municipalities is a small city and others are small rural municipalities. All member municipalities purchase secondary care services from the new organization, seven of the municipalities purchase primary health care services (for 80% of population) and three of the municipalities also purchase some social services such as elderly care and services for alcohol and drug abusers (for 62% of population). The district has eight health centres and one hospital. The Päijät-Häme district, located in southern Finland, has 15 municipalities and a total population of 210 000 inhabitants. One of the municipalities (city of Lahti) is the seventh largest city in Finland. The new organization is responsible for providing secondary care services for all member municipalities, and primary health care and social welfare services for eight member municipalities with a total population of 51 000. 7.1.2.3 Municipalities’ cooperation with the private sector Traditionally all municipal health services have been delivered by municipally owned organizations, health centres and hospital districts. In 1993, municipalities were given the freedom to purchase services from private providers. This has become more popular since the mid-1990s, but only a small fraction of municipal services is currently purchased from private providers. Some municipalities and hospital districts have introduced a purchaser–provider split to their administration which improves the possibilities to purchase services from private providers (for example, the cities of Tampere, Oulu and Raisio, and Pirkanmaa Hospital District). At present, there is controversy among politicians about the appropriate role for the private sector in municipal health care: in general, left-wing politicians oppose and right-wing politicians support purchasing services from private providers. Cooperation with private providers is promoted especially by the Ministry of Employment and Sitra. Below are some examples of cooperation between municipalities and the private sector. The highly specialized hospital, Coxa, was founded in Tampere in 2002 to carry out endoprosthetic operations. Coxa works as a limited company, 135

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and it was founded by Pirkanmaa hospital district (and three other hospital districts), four cities, one Finnish foundation (Invalidisäätiö) and a German private hospital company, Wittgensteiner Kliniken AG, which originally had 20% ownership. All elective endoprosthetic operations of Pirkanmaa hospital district are carried out in Coxa hospital. In addition, it provides these services for patients from other hospital districts as well as private patients. Private patients are operated on only after regular working hours and physicians do this work as private practitioners. About 10% of the hospital’s activities were for private patients in 2005. In 2005 Wittgensteiner Kliniken AG sold all its shares to Sitra (see section 4.2.3). The municipality of Karjaa agreed with Samfundet Folkhälsan (a non-profit “third sector” organization) in 1998 that Karjaa would purchase all primary health care and geriatric services from Folkhälsan. Folkhälsan founded a company which it owns in its entirety to provide the services, renting facilities from Karjaa. The objective of Karjaa was to reduce health care spending, but during the first few years costs increased and there were some disagreements between Karjaa and Folkhälsan. However, after a few years spending stabilized and currently is at the average level in Finland. At present, the company also provides services in the same facilities for other municipalities. In 2004 the City of Lahti made a contract with the Finnish private company MedOne to provide all the services of one of its health stations (Vuorenkoski and Mikkola 2007). The business activity of MedOne concentrates on outsourcing health care services, mostly leasing health care professionals (mainly physicians) to public health care (see section 3.5.2.1). The personnel of the health station were transferred to this private company. The primary reason for the reform was difficulty in acquiring personnel (mainly physicians). More recently, many other health stations have also been outsourced to private firms (for example in the cities of Kotka and Kouvola). Other types of service packages have also been outsourced (for example primary health care, emergency services and polyclinics). Some hospital districts have transformed laboratory services into publicly owned companies, which can provide services to hospital districts, municipalities and also to the private sector. Also, some nonclinical services are outsourced in some hospital districts such as catering and laundry services.

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7.2 Future developments Following the parliamentary elections in March 2007, a new Government was appointed in April 2007 (see section 1.4). The Prime Minister is Mr Matti Vanhanen (the Finnish Centre Party). Compared to the previous Government, the most notable changes are the shift of the Social Democratic Party from Government to opposition and shift of the National Coalition Party from opposition to Government. As a consequence the new Government is more right-leaning than the previous Government. The current Government’s programme is “A responsible, caring and rewarding Finland” (Prime Minister’s office 2007). It identifies about 25 different actions related to health policy. Actions related to organizational structure: • Steps will be taken to guarantee the attainment of the objectives defined in the project to restructure local Government and services and to prepare the necessary legislative amendments (see also section 7.2.1). • The development of electronic information systems will be continued (see section 7.2.2). • To lower the barriers between primary and specialist health care and improve cooperation, the Primary Health Care Act and the Act on Specialized Medical Care will be combined into a comprehensive Health Care Act. • The role of primary health care will be reinforced. In order to restructure services, special measures will be taken to develop primary health care, social work, emergency care, and mental health and substance abuse services. • Seamless service chains in primary care, secondary care and closely related social services, including preventive measures, will be improved. • Steps will be taken to improve the evaluation of the quality and effectiveness of services and their supervision and guidance. • Municipalities’ capabilities for research, product development and service innovations will be enhanced. • A social and health care services innovation project will be carried out aimed at improving patient empowerment, effectiveness and cost-efficiency of services, developing the division of duties and expanding the diversity of services. • The availability of sufficiently qualified personnel will be ensured by means of on-the-job training, competitive compensation plans, and developing the content of work and management systems. Actions related to access to services:

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• The system of guaranteed access to health care will be reviewed, and the necessary changes to time limits and procedures will be made (see section 7.1.1.3). • Citizens’ right to seek care across municipal borders will be expanded. •

• •

• • •

Actions related to costs/financing: A revision of user-fees for social and health care services will be carried out to adjust for inflation. At the same time, a system will be created under which charges will, in future, be adjusted to reflect actual cost levels and that the charges do not induce people to select inappropriate forms of treatment. The payment ceiling system will be reformed. In order to raise cost awareness, the transparency of the pricing and financing of municipal services will be increased, the objective being that the customer is informed not only of his or her own share of the cost but also of the total cost of the service provided. The outpatient drug reimbursement system will be reformed so that cost containment is more efficient. A special working group will be appointed by the MSAH to address this issue. The state contribution to NHI will be included within the general state spending limits (previously they were not included). Municipal finances will be strengthened by increasing state subsidies to municipalities.

Actions related to health promotion: • The multisectoral Government programme “Policy programme for health promotion” will be started (see section 7.1.1.9); • Taxes on alcoholic beverages and tobacco products will be raised in an attempt to promote public health. • • • •

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Actions related to private provision: Government promotes partnerships between the public, private and third sector in the provision of services. The adoption of a purchaser–provider split will be encouraged (see section 7.1.2.3). The use of municipal service vouchers will be extended to include social and health care services. Service vouchers will be accepted in home nursing from the beginning of 2008 (Vuorenkoski 2007c). NHI reimbursement for dentists’ fees will be increased from 30% to 40%. More efficient use of public health care facilities for private health care provision will be promoted.

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• Commercialization and exports of health care innovations will be encouraged in the social and health care services innovation project. The Government programme, the National Development Programme for Social and Welfare and Health Care, was devised for the next four years (see section 7.1.1.1). The Advisory Board of Social and Health Care is responsible for its preparation, implementation and follow-up. Key stakeholders are represented in this legislative board which is chaired by the Minister of Health and Social Services. The development programme will be strongly implementation oriented. Three major developments that are likely to have a significant impact on health services in the future are described below. 7.2.1 Restructuring of municipalities and services One of the most discussed future developments of the public sector health care system is to create a secure structural and financial basis for municipal services by creating organizations serving a larger population base. At the moment there are 415 municipalities (in 2008) with a median of about 5000 inhabitants. Although the number of municipalities has already decreased in the last five years from 448, the Government aims to further decrease the number. Some municipalities have already formed health centre federations to provide primary health care services (there are currently 65 federations). Secondary and tertiary level health care services are provided mainly by 20 hospital districts which are municipal joint federations. There are numerous ongoing local projects to increase regional cooperation (see section 7.1.2.1). To promote this process the Government initiated a project to restructure municipalities and services in 2005 (Järvelin and Pekurinen 2006). The project made three different proposals for organizing basic services in the future: a model of basic municipalities, a regional model and a district model. In January 2007, the Parliament accepted an act (Act on Municipal and Service System Reform) which directed the process according to the basic municipalities model. According to the act, the state will financially support mergers of municipalities. The act states also that primary health care and social services closely related to health services should be organized by organizations covering at least 20 000 inhabitants. This would not necessarily require mergers of municipalities smaller than 20 000 inhabitants, but forming of for example municipal joint federations. Currently, only about one in four health centres has a population base of 20 000 or more. Additionally, according to the act, the responsibility of organizing and funding forensic psychiatry examinations and examinations related to child sexual abuse will be transferred to the state by no later than 2009. 139

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In autumn 2007, all the municipalities made detailed plans for the state administration on how the stated goals are to be achieved. However, the state administration was satisfied only with a minority of these plans. The majority of the municipalities are required to further specify their plans or have been summoned for negotiations with the state administration. Plans reveal that municipalities intend to form about 70 cooperational regions involving about 300 municipalities. About half of these would work as joint municipal federations. Another proposed model is that one municipality would have the administrative responsibility of organizing services and others would have a contract with that municipality related to the organization of services for their residents (currently about 20 municipalities have arranged services according to this model). In February 2008, decisions on municipal mergers were made so that the number of municipalities will be reduced by 62 by January 2009. Additionally, there are another 12 ongoing merger processes involving 29 municipalities. The Government will produce a report to the Parliament on the progress of the project during 2009. Municipalities are obliged to make final decisions on the implementation of the law before that. The target for this process is to be completed by 2012. 7.2.2 Electronic information systems In December 2006, the Parliament decided to introduce a nationwide EPR system in Finland (Vuorenkoski 2007a). Currently, every service provider has chosen their patient record system individually and systems are usually not connected to each other. According to the new act (Act on Electronic Management of Information on Users of Social and Health Services), the SII will set up a national digital archiving service for health service providers. In the new system every provider organization will still have their own patient record archive in the archiving system of SII. However, the structure of the archives will be uniform. All public service providers are obliged to have their patient record archive in the new system and private providers have to join the system if they have electronic archives. Every service provider will have access to all archives through the national index service. Consent from the patient is needed for accessing patient records from the archive of other service providers. Individuals will have access to their own patient records and will be able to see who has accessed their records and when. According to law, the system should be fully functional in 2011. The introduction of the national EPR system will probably significantly change the current situation and lead to more integrated information technology solutions in health services. 140

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Linked to the development of the national EPR system is the development of a national electronic prescription system. A pilot programme was implemented between 2003 and 2006. In December 2006, the Parliament accepted a new act (Act on Electronic Prescription) on how to develop the system further (Vuorenkoski 2007a). According to the act a national electronic prescription database will be maintained by SII. In this system prescriptions are sent electronically from the physicianâ&#x20AC;&#x2122;s office to the central database to which pharmacies have electronic access. All service providers are obliged to make prescriptions electronically by 2011. However, patients can refuse the electronic prescription and receive a conventional paper prescription instead. 7.2.3 National level steering of health services In Finland the responsibility for the organization of public health services is decentralized to over 400 municipalities. Currently, the delivery and quality of health care services varies considerably across municipalities which can lead to conflict with the constitution assuring equal access to health services according to need for all Finnish residents. One reason for this variation is that direct national level steering mechanisms have gradually been weakened since the 1980s. At present, the municipalities are rather independently able to organize health care services because legislation (in particular the Primary Health Care Act and Act on Specialized Medical Care) provides only a loose framework for municipal health service provision. During the last fifteen years the main national level steering mechanisms have been steering by information, for which STAKES has had the main responsibility. However, this approach is not considered as effective as it was intended. The main responsibility for national level supervision of health care providers is currently held by the five provincial state offices, to which patients can make complaints (see section 2.4.4). In severe cases these complaints are forwarded to the NAMLA. Citizens can also appeal to the administrative court if they do not receive appropriate health services from the municipalities. These appeals have increased somewhat since the year 2000. Several recent reforms have shifted towards centralization after a long line of actions to decentralize decision-making in public health care services. In 2005, Parliament enacted maximum waiting times for public sector health services (reformed Primary Health Care Act and Act on Specialized Medical Care) and the MSAH put together national level guidelines defining the limits of access to non-urgent specialized care procedures (see section 7.1.1.3) addressing the considerable differences in waiting times across municipalities and services.

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The second major reform took place in 2006, when national level supervision was reinforced by expanding the functions of the NAMLA from supervising individual professionals to supervising health care organizations, health centres, hospitals and other institutions providing health services (Vuorenkoski 2006a). This supervision is based mainly on complaints of the patients. But the agency can also take necessary actions without specific patient complaints. For example, in summer 2007 the NAMLA approached municipalities that did not comply with the maximum waiting time guarantee and urged them to fully implement the legislative guarantee. The third major reform to strengthen national level steering was a legislative change by Parliament in January 2007. The four-year Target and Action Plan for Social Welfare and Health Care (see also section 4.2) was replaced by the “National Development Programme for Social Welfare and Health Care” which is devised by each Government for a four-year time period. The first National Development Programme for Social Welfare and Health Care was produced in January 2008. This programme aims to be more implementation-oriented than the previous plans. In the future state funding for local development projects in the field of social and health care will be closely tied to the development programme. The responsibility for preparation, implementation and follow-up of the plan has been given to a new Advisory Board of Social and Health Care as defined in the new legislation. Fourthly, in recent years the Government has regained legal powers to regulate by using lower level decrees to make changes in specific areas of concern, such as school health care, care of people addicted to opiates, maternal and child health and screening. Sometimes these changes have been accompanied by earmarked state contributions in the municipal budget.

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8. Assessment of the health system

8.1 Stated objectives of the health system

innish health policy seeks to incorporate health into all policies and all aspects of public decision-making. In addition to a broadly based preventive health policy, Finnish health policy also stresses the importance of efficient and accessible health care services for the entire population. More specifically, Finnish health policy aims to reduce premature deaths, extend people’s active and healthy lives, ensure the best possible quality of life for all and reduce inequalities in health (MSAH 2004). These aims have been stated, for example, in the Finnish National “Health for All by the year 2000” strategy, which was adopted by Parliament in 1986 (MSAH 1987). Finland’s health policy has been broadly successful. For example, life expectancy increased by nine years between 1970 and 2005, infant mortality has decreased rapidly over the last 30–40 years, age-standardized mortality from coronary heart disease among working age people dropped by more than 50% between 1984 and 2005 (Statistics Finland 2006a) and the PYLL rate lowered in Finland between 1992 and 2004 by approximately 25% (Vohlonen, Bäckmand, Korhonen 2007). However, problems still remain. For example, differences in health status remain between different sections of the population and socioeconomic inequality in mortality has even increased (Häkkinen 2005). During the years 1971–1995 life expectancy at age 35 increased by about four years, but more among the upper class than lower class population (Martikainen, Valkonen, Martelin 2001) (see section 8.2.2). The health care system is one important tool to improve mortality and morbidity trends. The basis of the health care system is laid down in the Constitution of Finland (section 19). According to the Constitution:

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Everyone shall be guaranteed by an Act the right to basic subsistence in the event of unemployment, illness, and disability and during old age, as well as at the birth of a child or the loss of a provider. The public authorities shall guarantee for everyone, as provided in more detail by the Act, adequate social, health and medical services and promote the health of the population.

The following sections discuss the extent to which these and other normative criteria commonly employed to evaluate the performance of a health system have been met in Finland.

8.2 Distribution of the health system’s costs and benefits across the population 8.2.1 Distribution of costs The majority of health care financing stems from municipal and state taxes. The income tax of the state is progressive and income tax of municipalities is proportional (a flat percentage in each municipality). NHI is funded by tax payers, the state budget and employers. The insurance premium for tax payers is proportional, being a flat percentage of income. Since the share of the progressive source of state finance has decreased (from 36% to 21% of total health expenditure between the years 1990–2005; Table 3.1) the total financing of health care has become more regressive, that is, financing has been shifted relatively more to low-income groups. The most regressive part of the financing system is user-fees (see section 3.3.3). For municipal services legislation sets the maximum user-fees and an annual ceiling for health care charges. About 7% of health care financing in municipalities derives from user-fees. Outpatient drugs are not covered by the municipal health care system but by NHI. On average, 63% of the costs of outpatient prescription drugs are reimbursed to the patient (NAM 2007), which is much lower than for municipal health care services. In extreme situations when an individual’s or a family’s income is not enough to cover the userfees of municipal health care services or outpatient drugs, social assistance is available. NHI covers about one third of the actual costs of private health services and users have to pay a large proportion of expenses out-of-pocket. Poorer people have less opportunity than wealthier people to use private health care as the reimbursement rate is low, but they can use the municipal services instead. Statistics show that, for example, unemployed people do not use private services 144

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as much as employed people (MSAH 2007b). There are also geographical differences in the use of private services since in rural municipalities there are less private services available. It may be considered inequitable that NHI covers a portion of private health care costs while some parts of the population (e.g. poorer people and those living in rural areas) do not use these services. 8.2.2 Distribution of benefits In terms of distribution of benefits there are two major challenges in the Finnish health care system: geographical inequities and inequities between socioeconomic groups. Another future challenge is the ability to provide own language and culturally sensitive health services to ethnic minorities with the expected continued increase in immigration. Data on inequities between population groups are not collected routinely (except geographical differences) but some information can be obtained from empirical research (Teperi et al. 2006). There are significant differences between municipalities in service provision (for example GP visits, dental care, mental health care, elective surgery in specialized care) and waiting times. The numbers of inpatient cases and surgical procedures per capita vary markedly between hospital districts (adjusted by age and sex), for example, in treatment of ischaemic heart disease (Häkkinen et al. 2002) and in orthopaedic operations (Mikkola et al. 2005). Significant ageadjusted variations between five university hospital regions in outpatient care have also been observed (Häkkinen and Alha 2006). There are also significant differences between municipalities in resources invested in municipal health care, which persist after needs adjustment (see also section 8.3). Needs can be difficult to assess since statistics on morbidity are not routinely collected (except cancer and communicable disease register data), but there are some proxy indicators collected on mortality, use of special drug reimbursement, working age recipients of sickness allowance, recipients of disability pensions and recipients of disability benefits. For example, the proportion of working age recipients of sickness allowance varies between 7% and 18 %, which implies that there are significant differences in morbidity between municipalities (SotkaNet 2008). Several factors may explain the differences in delivery and utilization of municipal health services. It is important to highlight that the Finnish health care system is decentralized and national steering is rather weak (see section 2.3). There are also differences in age structure, morbidity, physician shortage (more severe in rural municipalities) and access to private health care services and use of occupational health care services (more common in cities) which 145

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may explain these variations. However, it is clear that some of the variation leads to geographical inequities in quality and scope of municipal services. To tackle geographical inequities in access to care, maximum waiting times were defined in the Primary Health Care Act and Act on Specialized Medical Care in 2005 and the MSAH put together national guidelines defining the limits of access to non-urgent specialized care procedures (see section 7.1.1.3). The legislative reform has had a significant impact on reducing waiting times, although there are still problems in some municipalities and hospital districts. In addition, there are national treatment guidelines and quality guidelines for services to standardize practices across the health care system. There are also significant socioeconomic differences in the use of health care services (Häkkinen and Alha 2006). Among OECD countries pro-rich inequity in doctor visits was found to be one of the highest in Finland in 2000 (along with the United States and Portugal) (Van Doorslaer, Masseria, Koolman 2006) despite the fact that inequality of distribution of physician visits between socioeconomic groups has decreased somewhat in Finland between 1987 and 2000 (Teperi et al. 2006). There are also significant pro-rich differences in screening, dental care, need-related coronary revascularizations and in some elective specialized care operations (for example hysterectomy, prostatectomy, lumbar disc operation) (Teperi et al. 2006). These differences are amplified by the fact that there are persistent socioeconomic inequalities in health status: white-collar workers are healthier than blue-collar workers, employed people are healthier than the unemployed, and people with high income and the highest educational level are healthier than low-income people with only a basic education (Koskinen 2004; Martelin, Koskinen, Lahelma 2006). Perhaps one of the most important reasons for the socioeconomic differences in the use of services is that the private sector and occupational health care, which are less accessible to the low-income population, offer better access to services (e.g. a major difference is waiting times) than the municipal sector. As opposed to municipalities, NHI does not set any financial limits for providers which would lead to rationing of services. Additionally, NHI funds services without any assessment of need or efficiency. By contrast, services provided in the municipal system usually have strict budgets. There are clear gaps in the coverage of municipal services in some areas, for example in dental services and psychotherapy. Inequities arise also from the fact that occupational health care is free for patients compared to municipal health care which has user-fees (see section 3.3.3). In general, private health services and occupational health are more commonly used by the wealthiest part of the population (Häkkinen 2005). Also, in some disease groups the pro-rich distribution of private and occupational 146

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health services may lead to a pro-rich distribution also in municipal services since private outpatient services are an important pathway to specialized care in municipal health services (for example, for cataract operations and several other surgical treatments). Better access for private patients also may derive from the fact that private health care does not have the financial incentive for gate-keeping as municipal health centres have. During the last ten years private and occupational health services have grown faster than municipal health services. During the years 1996 to 2006 the number of physicians in occupational health care has increased by 69% and in private health care by 62%, whereas in municipal health centres the increase in physicians has only been 9% (Suomen Lääkäriliitto 2006).

8.3 Efficiency of resource allocation in health care Allocative efficiency in the municipal health care system has not been analysed in Finland. However, it has been estimated that mental health services are underfunded (Lehtinen et al. 2006) and specialized health care services in general are overemphasized in comparison to primary care services (Mattila K 2006). Generally, municipalities do not have much influence on the volume and costs of hospital care of the hospital districts. This leads to the situation in which it is easier to limit the costs of primary health care than specialized health care and hence increase the resources of specialized health care compared to primary health care. The number of physicians in health centres has increased by 9% and in hospitals by 21% between 1996 and 2006 (Suomen Lääkäriliitto 2006). There are striking variations between municipalities in terms of per capita health care expenditure. Health expenditure including long-term care varied from 940 to 2310 euros per inhabitant in 2004 (Hujanen, Pekurinen, Häkkinen 2006) and needs-adjusted expenditure was 2.5 times more in the “most expensive” municipality when compared to the “least expensive” municipality. These differences have existed for a long time, although during the last 10 years they appear to have narrowed. Differences in the organization of the delivery system is one of the major factors explaining this variation in expenditure. The system of dual public financing (municipalities and NHI) creates challenges for the overall efficiency of the service production. For example, in pharmaceutical care dual financing leads to cost-shifting problems as municipalities pay drugs used in inpatient care and NHI funds drugs used in outpatient care. Health centres and hospitals have financial incentives to use outpatient drug therapy instead of drugs administered in the health care 147

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unit (intravenous drugs) or specialist level operations, even when it is not the economically or even clinically optimal choice. Municipalities also have incentives to treat older patients in sheltered accommodation rather than nursing homes as they have to pay for drugs used in nursing homes. At a more general level, health care service providers do not have financial incentives to reduce outpatient drug spending. In a recent OECD country report of Finland in 2005 it was suggested that some financial incentives should be introduced for physicians to contain outpatient pharmaceutical expenditure (OECD 2005). More information on the advantages and disadvantages of dual financing are discussed in the OECD report on Finnish health care system (OECD 2005).

8.4 Technical efficiency in the production of health care The measurement of technical efficiency of the Finnish health care system has been in practice for some time. The largest projects analyse productivity in hospitals (Linna 2006) and in elderly care (Noro 2005); they are carried out by STAKES. A research and development project to produce benchmarking information on hospital performance and productivity (Hospital Benchmarking) was launched in 1997 (Linna 2006). At the beginning, the main aim of the project was to develop a new measure to describe the output of hospitals better than traditional measures such as admissions or outpatient visits. A further aim was to provide the management of hospitals with benchmarking data for improving and directing activities at hospitals. After a few years the project expanded and at present, nearly all publicly delivered specialized health care in Finland is included. Hospital Benchmarking data were integrated into the production of national statistics in 2006. The data allows regional measurement of productivity and costs indicating, for instance, how much the costs of a hospital district or a municipality deviate from the national average and how much of this deviation reflects the inefficient delivery of services and the per capita use of services. Hospital Benchmarking data have increasingly been used for appraising and directing hospital activities. Hospital Benchmarking data indicate that productivity of hospitals has decreased somewhat from 2001 to 2005 and that there are significant differences in productivity between hospitals (STAKES 2007c). A clear increase in productivity in the Finnish health care system was observed between 1990 and 1994 connected to the economic recession (HĂ¤kkinen 2005). One possibility to increase technical efficiency, or at least to increase 148

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transparency, is to develop a uniform national method for pricing the services of hospital districts, which would allow comparisons across providers (OECD 2005). Finnish researchers have also made path-breaking progress in outcomeevaluation based cost-effectiveness evaluation under the PERFECT project. The project aims to develop indicators and models that can be used to systematically monitor the effectiveness, quality and cost-effectiveness of treatment episodes in specialized medical care across regions, hospitals and population groups. The first stage of the analysis comprises stroke, hip fracture, low birth weight infants, breast cancer, schizophrenia, acute myocardial infarction, and hip and knee replacements. For example, in acute myocardial infarctions (HĂ¤kkinen et al. 2007) the project has found significant differences in clinical practices, effectiveness and costs between hospital districts. Technical efficiency in pharmaceutical care has been promoted recently by generic substitution, introduced in Finland in 2003. Pharmacies are obliged to substitute a prescribed medicinal product that costs more than a certain defined maximum price limit with a product costing less than that limit containing the same substance. The policy has been very successful with annual savings of about 5% of outpatient drug expenses (see section 6.6). In international comparisons Finnish health care expenditure appears relatively low compared to other OECD countries while levels of human and capital resources are comparable. One important reason for this is the low salary of health care personnel.

8.5 Accountability of the health care system In the public sector health care system decentralization offers many possibilities to ensure the accountability of health services to local citizens. This has been considered to be one of the most important benefits of decentralization in Finland. The municipalities are also accountable to the state by following legislation, national level policies and guidelines. In municipalities the main decision-making power lies with the municipal council, which is elected every four years by the inhabitants of the municipality. The council appoints a municipal executive board and various municipal committees, including a health committee. The most important decisions on public sector health services are made in these bodies which are politically accountable to the residents. Primary health care is usually directly supervised by these bodies, and specialized services through the council and the executive board of the hospital district. However, although these political bodies are rather 149

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active in financial and structural issues, explicit priority setting is left to the administrative and clinical personnel. In addition to the accountability of the health care system through the political system, two important official mechanisms through which citizens can influence health care services are complaints to the provincial administration, which can, in severe cases, be forwarded to the NAMLA, and appeal to the administrative court. Organizations providing medical treatment must have a patient ombudsman, whose duty is to inform patients of their rights and assist them, if necessary, to submit a complaint, appeal or claim for indemnity (see section 2.4.4). From the perspective of the patient, one major problem of the health care system has been long waiting times for certain services in ambulatory and hospital care. These waiting times vary considerably between municipalities which led to state-defined maximum waiting times for health services in 2005. The legislative reform has had a significant impact in reducing waiting times (see section 7.1.1.3). In the private health care system providers are mainly accountable directly to the individual patients. NHI, which partly reimburses private health care costs, has a very limited role in overseeing the quality of these services.

8.6 Contribution of the health system to health improvement Analysis of the contribution of the health sector to the population’s general health has been scarce in Finland, but it is clear that technological advances in medicine and preventive measures during the last decades have had some influence in improved life expectancy and functional capacity. One indicator of health status that is directly connected to the health care system is mortality amenable to health care (avoidable mortality). During the 1980s and 1990s the improvements in life expectancy in Finland were mainly due to a decline in amenable mortality and especially in mortality from ischaemic heart disease, although in the 1990s the contribution to the health care system was somewhat smaller (Nolte and McKee 2004). The PYLL rate reduced in Finland between the years 1992 and 2004 by approximately 25% (Vohlonen, Bäckmand, Korhonen 2007). Contrary to the equity goal of Finnish health policy, the differences between socioeconomic groups in avoidable mortality is large and in some cases seem to be widening (Arffman et al. 2007). In a comparative study (Nolte and McKee 2003) using an aggregate measure 150

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of amenable mortality (not including ischaemic heart disease) from the year 1998, Finland ranked eighth among 19 OECD countries, behind, for example, Sweden and Norway. Another example of the possible contribution of the health system to health improvement is cancer care. Five-year cancer survival has significantly increased during the last decades (Cancer Society of Finland 2005). This is probably at least partly due to improved health care. Health promotion, including the prevention of diseases, has been the main focus of Finnish health care policy for decades. Public health efforts have resulted in the total eradication of certain communicable diseases, a decrease in several lifestyle-related diseases and an improvement in the health and functional capacity of the population. Several national measures have been implemented to reduce smoking, alcohol consumption, harmful dietary habits, road traffic accidents and occupational diseases (see section 6.1). Partly owing to the comprehensive network of maternal and child health care services, infant mortality in Finland is one of the lowest in the world. Children and young adults receive extensive preventive dental care (see section 6.10), which may have contributed to the observed improvements in oral health (see section 1.5). Vaccinations have been effective in reducing the prevalence of diseases; vaccination coverage in Finland is very high (see section 6.1). In the last few decades perhaps the most significant programme to improve population health was the North Karelia Project launched in the 1970s, which was associated with a 73% reduction in the national annual mortality rate of coronary heart disease among men under 65 years old in 1995 from the pre-programme years (see section 6.1).

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9. Conclusions

he Finnish health care system provides relatively good quality health services for reasonable cost with quite high public satisfaction. The most visible problems are long waiting times and personnel shortages in some municipalities. An ageing population, new medical technology and drug innovations alongside increasing public expectations are creating challenges for the Finnish health care system. There are also some features of the Finnish health care system that are perceived as problematic: high level of decentralization, weak position of primary care compared to secondary care, relative lack of coordination between primary and secondary care, and dual financing. In addition, there exist significant inequalities in health and access to health care services. These problems are summarised here. Following the reforms of 1993, the Finnish health care system (municipal services) was decentralized. More than 75% of municipalities have fewer than 10 000 inhabitants and 20% have fewer than 2000. It has been stated that public responsibility for health care has been decentralized in Finland more than in any other country (Häkkinen and Lehto 2005). State level regulations and steering on municipal health care service provision are not very detailed. Municipalities can rather freely set their own municipal income tax rates, decide how much they invest in health care and how they organize services. The advantages of decentralization are strong local democracy, local ownership of public services and better responsiveness to local needs (OECD 2005). However, in recent years growing concerns have been raised that the problems of decentralization outweigh the advantages. Problems created by decentralization are diseconomies of scale, lack of expertise, geographical inequalities in access to services, increase in problems relating to random shifts in expenditure (e.g. the possibility that a few expensive treatments can seriously hamper the annual budget of a municipality), difficulties in securing a sufficient workforce and lack of regional and national cooperation. The limited 153

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coordination across municipalities has led to increasing regional variations in care. In addition, population movement from rural municipalities to cities and ageing of the population especially in rural areas have made small rural municipalities more and more vulnerable while being solely responsible for the organization of the health services. Indeed, there are signs in recent years that decentralization is reversing slightly. The MSAH has tightened the regulative steering of municipalities (for example, defining maximum waiting times for municipal health services) and national level supervision has been reinforced by expanding the functions of the NAMLA from supervising individual professionals to supervision of health care organizations, health centres, hospitals and other institutions providing health services. Additionally, the Government started a project to restructure municipalities and services in 2005 which will lead to a decreasing number of municipalities and increasing cooperation between municipalities. In January 2007, Parliament accepted an act defining how to continue the process which stated that primary health care and social services closely related to health services should be organized by organizations covering at least 20Â 000 inhabitants. In response to this municipalities have made plans to increase cooperation in many regions and in February 2008 decisions on municipal mergers were made so that the number of municipalities will be reduced by 62 by January 2009. It is, however, difficult to estimate what the final outcome of this process will be. The principle of municipal autonomy has a strong tradition in Finland and municipalities value highly their independence in arranging basic services, so the reform will not be easy. Mergers of municipalities can be an especially difficult process for local politicians, municipal employees and residents. However, the general view is that this is the right direction in which to develop the organization of health services in Finland. The municipal health care system has different structures in place for primary and secondary services. There are also separate acts governing the provision of these services. Having separate organizational structures has clearly hindered the cooperation between these levels, both from clinical and economic perspectives. For example, transmitting patient records and other information on patients between primary and secondary care can be difficult. During the last 10 years several local reforms have been conducted to enhance cooperation between primary and secondary health care and social welfare services by integrating organizations. The new Government appointed in April 2007 will promote this process further as it announced that the Primary Health Care Act and the Act on Specialized Medical Care will be combined into a comprehensive Health Care Act. The central aim is to reinforce the role of primary health care. It will be necessary in the future to carefully assess whether municipal primary and secondary services should be structured and financed by the same 154

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organizations. In any case it is evident that primary health care services need to be strengthened relative to secondary care services. There is a dual system of public financing for health care services in Finland: municipal financing based on taxes and NHI financing based on compulsory insurance fees. Municipalities fund municipal health care services (except outpatient drugs and transport costs) and NHI (partly) funds private health care, occupational health care, outpatient drugs, transport costs and sickness allowances. This dual public financing creates challenges for the overall efficiency of service provision, for example as evidenced by cost-shifting in pharmaceutical care. Public funding for private services and curative occupational services is problematic from many perspectives: part of the insured population (lowincome people, unemployed people and people living in rural areas) has fewer possibilities to use these services; the SII does not regulate the quality or efficiency of the services provided; and private services provide the possibility to bypass municipal primary care gate-keeping for municipal specialist level services. It is not the most efficient use of resources for these three somewhat overlapping systems to be publicly funded. One possible danger is that in the future the Finnish health care system will provide different levels of publicly financed services for different population groups which goes against current general health policy objectives. There are significant socioeconomic differences in the use of health care services, including physicians, screening, dental care and some elective surgeries. Although overall mortality has fallen, socioeconomic inequality seems to be increasing. Indeed, even though the Nordic welfare state model served as an important guide when the health care system was being developed, socioeconomic inequalities are still one of the major challenges facing the Finnish health care system. However, despite these challenges, the Finnish health care system has made considerable strides in improving public health, both through preventive and curative measures. Infant and maternal mortality in Finland is one of the lowest in the world and there have been significant improvements in life expectancy, amenable mortality, eradication of communicable diseases, cancer survival and the functional capacity of the population.

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10. Appendices

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Vuorenkoski L (2007b). State funding for local development projects. Bertelsmann Foundation, Health Policy Monitor, October 2007 (http://www. hpm.org/survey/fi/a10/2, accessed 24 April 2008). Vuorenkoski L (2007c). Vouchers in social and health care - follow-up. Bertelsmann Foundation, Health Policy Monitor, October 2007 (http://www. hpm.org/survey/fi/a10/4, accessed 24 April 2008). Vuorenkoski L, Keskimäki I (2004). Ensuring access to health care. Bertelsmann Foundation, Health Policy Monitor (http://www.hpm.org/survey/ fi/a3/3, accessed 24 April 2008). Vuorenkoski L, Mikkola H (2007). Outsourcing in primary health care. Bertelsmann Foundation, Health Policy Monitor (http://www.hpm.org/survey/ fi/a9/3, accessed 24 April 2008). Vuorenkoski L, Wiili-Peltola E (2007). Merging primary and secondary care providers. Bertelsmann Foundation, Health Policy Monitor, April 2007 (http:// www.hpm.org/survey/fi/a9/1, accessed 24 April 2008). WHO Regional Office for Europe (2007). European Health for All database [online database]. Copenhagen, WHO Regional Office for Europe (http:// www.euro.who.int/hfadb) (January 2007 update). Widström E (2006). Extension of publicly funded dental care to all. Bertelsmann Foundation, Health Policy Monitor, October 2006 (http://www. hpm.org/survey/fi/a8/2, accessed 24 April 2008). World Health Organization (2004). World Health Report 2004. Geneva, World Health Organization.

10.2 Principal legislation Employment Accidents Insurance Act 608/1948

Motor Liability Insurance Act 279/1959 Primary Health Care Act 66/1972 Act on Social Assistance 710/1982 Patient’s Injury Act 585/1986 Medicines Act 395/1987 Act on Specialized Medical Care 1062/1989 Mental Health Act 1116/1990 Private Health Care Act 152/1990 Act on Social and Health Service Planning and State Subsidy 733/1992 Act on User-fees in Social and Health care 734/1992 Act on the Status and Rights of Patients 785/1992 166

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Act on Municipality of Residence 201/1994 Act on Adaptation of Immigrants and Reception of Asylum Seekers 493/1999 The Constitution of Finland 731/1999 Occupational Health Care Act 1383/2001 The Sickness Insurance Act 1224/2004 Act on Rehabilitation Benefits of Social Insurance Institution 566/2005 Act on Electronic Prescription 61/2007 Act on Electronic Management of Information on Users of Social and Health Services 159/2007 Act on Municipal and Service System Reform 169/2007

10.3 Useful web sites The Association of Finnish Local and Regional Authorities: www. localfinland.fi Centre for Pharmacotherapy Development: www.rohto.fi Finnish Centre for Health Promotion: www.health.fi Finnish Institute of Occupational Health: www.ttl.fi/English Finnish Government: www.vn.fi/english Finnish Legislation Database: http://www.finlex.fi/en/ Finnish Medical Association: www.laakariliitto.fi/e/ Finnish Slot Machine Association: www.ray.fi/inenglish Finohta (Finnish Office for Health Technology Assessment) http://finohta. stakes.fi/en The Ministry of Social Affairs and Health: www.stm.fi/english The National Agency for Medicines: www.nam.fi/english The National Authority for Medico-legal Affairs: www.teo.fi The National Product Control Agency for Welfare and Health: www.sttv.fi The National Public Health Institute: www.ktl.fi/english The National Research and Development Centre for Welfare and Health: www.stakes.fi/english The Parliament: www.parliament.fi Pharma Industry Finland: www.pif.fi The Radiation and Nuclear Safety Authority: www.stuk.fi/english The Social Insurance Institution: www.kela.fi/english SotkaNet Indicator Bank www.sotkanet.fi Statistics Finland: www.stat.fi/index_en.html Suomi (public sector portal) http://www.suomi.fi/suomifi/english Terveyskirjasto (health library) www.terveyskirjasto.fi Terveysportti (health portal for professionals) http://www.terveysportti.fi/ 167

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10.4 HiT methodology and production process The Health Systems in Transition (HiT) profiles are produced by country experts in collaboration with the Observatory’s research directors and staff. The profiles are based on a template that, revised periodically, provides detailed guidelines and specific questions, definitions, suggestions for data sources, and examples needed to compile HiTs. While the template offers a comprehensive set of questions, it is intended to be used in a flexible way to allow authors and editors to adapt it to their particular national context. The most recent template is available online at: http://www.euro.who.int/observatory/Hits/20020525_1. Authors draw on multiple data sources for the compilation of HiT profiles, ranging from national statistics, national and regional policy documents, and published literature. Furthermore, international data sources may be incorporated, such as those of the Organisation for Economic Co-operation and Development (OECD) and the World Bank. OECD Health Data contain over 1200 indicators for the 30 OECD countries. Data are drawn from information collected by national statistical bureaux and health ministries. The World Bank provides World Development Indicators, which also rely on official sources. In addition to the information and data provided by the country experts, the Observatory supplies quantitative data in the form of a set of standard comparative figures for each country, drawing on the European HFA database. The HFA database contains more than 600 indicators defined by the World Health Organization (WHO) Regional Office for Europe for the purpose of monitoring Health for All policies in Europe. It is updated for distribution twice a year from various sources, relying largely upon official figures provided by governments, as well as health statistics collected by the technical units of the WHO Regional Office for Europe. The standard HFA data have been officially approved by national governments. With its summer 2004 edition, the HFA database started to take account of the enlarged European Union (EU) of 25 Member States. HiT authors are encouraged to discuss the data in the text in detail, including the standard figures prepared by the Observatory staff, especially if there are concerns about discrepancies between the data available from different sources. A typical HiT profile consists of 10 chapters. 1 Introduction: outlines the broader context of the health system, including geography and sociodemography, economic and political context, and population health. 2 Organizational structure: provides an overview of how the health system in the country is organized and outlines the main actors and their decision-

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making powers; discusses the historical background for the system; and describes the level of patient empowerment in the areas of information, rights, choice, complaints procedures, safety and involvement. 3 Financing: provides information on the level of expenditure, who is covered, what benefits are covered, the sources of health care finance, how resources are pooled and allocated, the main areas of expenditure, and how providers are paid. 4 Regulation and planning: addresses the process of policy development, establishing goals and priorities; deals with questions about relationships between institutional actors, with specific emphasis on their role in regulation and what aspects are subject to regulation; and describes the process of HTA and research and development. 5 Physical and human resources: deals with the planning and distribution of infrastructure and capital stock; the context in which IT systems operate; and human resource input into the health system, including information on registration, training, trends and career paths. 6 Provision of services: concentrates on patient flows, organization and delivery of services, addressing public health, primary and secondary health care, emergency and day care, rehabilitation, pharmaceutical care, long-term care, services for informal carers, palliative care, mental health care, dental care, complementary and alternative medicine, and health care for specific populations. 7 Principal health care reforms: reviews reforms, policies and organizational changes that have had a substantial impact on health care. 8 Assessment of the health system: provides an assessment based on the stated objectives of the health system, the distribution of costs and benefits across the population, efficiency of resource allocation, technical efficiency in health care production, quality of care, and contribution of health care to health improvement. 9 Conclusions: highlights the lessons learned from health system changes; summarizes remaining challenges and future prospects. 10 Appendices: includes references, useful web sites, legislation. Producing a HiT is a complex process. It involves: • writing and editing the report, often in multiple iterations; • external review by (inter)national experts and the country’s Ministry of Health – the authors are supposed to consider comments provided by the Ministry of Health, but not necessarily include them in the final version; 169

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• external review by the editors and international multidisciplinary editorial board; • finalizing the profile, including the stages of copy-editing and typesetting; • dissemination (hard copies, electronic publication, translations and launches). The editor supports the authors throughout the production process and in close consultation with the authors ensures that all stages of the process are taken forward as effectively as possible.

10.5 About the author Lauri Vuorenkoski is a senior researcher in STAKES (National Research and Development Centre for Welfare and Health) in the Health Services and Policy Research Group. He is also trained as a medical doctor and received a PhD in child psychiatry from the University of Oulu in 2001.

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The Health Systems in Transition profiles A series of the European Observatory on Health Systems and Policies

he Health systems in transition (HiT) country profiles provide an analytical description of each health care system and of reform initiatives in progress or under development. They aim to provide relevant comparative information to support policy-makers and analysts in the development of health systems and reforms in the countries of the WHO European Region and beyond. The HiT profiles are building blocks that can be used: • to learn in detail about different approaches to the financing, organization and delivery of health services; • to describe accurately the process, content and implementation of health reform programmes; • to highlight common challenges and areas that require more in-depth analysis; and • to provide a tool for the dissemination of information on health systems and the exchange of experiences of reform strategies between policy-makers and analysts in countries of the WHO European Region.

How to obtain a HiT All HiT country profiles are available in PDF format at www.euro.who.int/observatory, where you can also join our listserve for monthly The publication of the European Observatory updates of the activities of the European on Health Systems and Observatory on Health Systems and Policies, Policies are available at including new HiTs, books in our co- www.euro.who.int/observatory published series with Open University Press, Policy briefs, the EuroObserver newsletter and the Eurohealth journal. If you would like to order a paper copy of a HiT, please write to:

info@obs.euro.who int

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HiT country profiles published to date: Albania (1999, 2002 a,g) Andorra (2004) Armenia (2001g, 2006) Australia (2002, 2006) Austria (2001e, 2006 e) Azerbaijan (2004 g) Belgium (2000, 2007) Bosnia and Herzegovina (2002 g) Bulgaria (1999, 2003 b, 2007) Canada (2005) Croatia (1999, 2007) Cyprus (2004) Czech Republic (2000, 2005 g) Denmark (2001, 2007) Estonia (2000, 2004 g,j, 2008) Key Finland (2002, 2008) All HiTs are available in English. France (2004 c,g) When noted, they are also available Georgia (2002 d,g) in other languages: Germany (2000e, 2004e,g) a Albanian Hungary (1999, 2004) b Bulgarian Iceland (2003) c French Israel (2003) d Georgian Italy (2001) e German Kazakhstan (1999 g, 2007) f Romanian Kyrgyzstan (2000 g, 2005 g) g Russian Latvia (2001, 2008) h Spanish Lithuania (2000) Luxembourg (1999) i Turkish Malta (1999) j Estonian Mongolia (2007) k Polish Netherlands (2004 g) New Zealand (2001) Norway (2000, 2006) Poland (1999, 2005 k) Portugal (1999, 2004, 2007) Republic of Moldova (2002 g) Romania (2000 f, 2008) Russian Federation (2003 g) Slovakia (2000, 2004) Slovenia (2002) Spain (2000 h) Sweden (2001, 2005) Switzerland (2000) Tajikistan (2000) The former Yugoslav Republic of Macedonia (2000) Turkey (2002 g,i) Turkmenistan (2000) Ukraine (2004 g) United Kingdom of Great Britain and Northern Ireland (1999 g) Uzbekistan (2001g, 2007)

ISSN 1817-6127

HiTs are in-depth profiles of health systems and policies, produced using a standardized approach that allows comparison across countries. They provide facts, figures and analysis and highlight reform initiatives in progress.

The European Observatory on Health Systems and Policies is a partnership between the WHO Regional Office for Europe, the Governments of Belgium, Finland, Greece, Norway, Slovenia, Spain and Sweden, the Veneto Region of Italy, the European Investment Bank, the Open Society Institute, the World Bank, the London School of Economics and Political Science and the London School of Hygiene & Tropical Medicine.

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Sitra, the Finnish Innovation Fund is an independent public fund that promotes broad innovative changes in society in order to foster the success of Finland and ensure the wellbeing of its citizens.

In 2006, Michael E. Porter and Elizabeth Olmsted Teisberg published Redeﬁning Health Care (HBS Press), a groundbreaking strategic framework for health care delivery. The framework aligns the activities of all actors around value for patients, deﬁned as health outcomes achieved per unit of cost expended. Value-based thinking provides a powerful new lens with which to examine health systems in any country. Following a brief summary of value-based principles, this report analyzes the Finnish health care system using the value-based framework and proposes recommendations for reform. The principal goal is not to provide a comprehensive road map for Finnish health care or lay out individual policy proposals. Rather, the aim is to catalyze discussion in Finland and inform Finnish stakeholders as they work to improve the health of the Finnish people.

The Finnish Health Care System: A Value-Based Perspective

The Finnish Health Care System: A ValueBased Perspective is part of the Health Care Programme by Sitra, the Finnish Innovation Fund. The aim of the programme is to improve the Finnish health care system to meet the challenges of the future.

The Finnish Health Care System: A Value-Based Perspective Juha Teperi, Michael E. Porter, Lauri Vuorenkoski and Jennifer F. Baron

Sitra Reports

the Finnish Innovation Fund

ISBN 978-951-563-658-4 ISSN 1457-571X

Itämerentori 2, P.O. Box 160, FI-00181 Helsinki, Finland, www.sitra.ﬁ Telephone +358 9 618 991, fax +358 9 645 072

Sitra Reports

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The Finnish Health Care System: A Value-Based Perspective

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Sitra Reports

The Finnish Health Care System: A Value-Based Perspective Juha Teperi, Michael E. Porter, Lauri Vuorenkoski and Jennifer F. Baron

SITRA • HELSINKI

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Sitra Reports 82

Layout: Tiina Lahdelma © Authors and Sitra The Finnish Health Care System: A Value-Based Perspective Juha Teperi, Michael E. Porter, Lauri Vuorenkoski and Jennifer F. Baron ISBN 978-951-563-658-4 (paperback) ISSN 1457-571X (paperback) ISBN 978-951-563-659-1 (URL:http://www.sitra.fi) ISSN 1457-5728 (URL: http://www.sitra.fi) The Sitra Reports series consists of research publications, reports and evaluation studies especially for the use of experts. To order copies of publications in the Sitra Reports series, please contact Sitra at tel. +358 9 618 991 or e-mail publications@sitra.fi. Edita Prima Ltd. Helsinki 2009

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Foreword

It is well known internationally that the publicly organized Finnish health care service system has been a success story. Since the turn of the new millennium, the expenditure on health and social care has significantly exceeded our national GDP growth but this development over the long-term will not be sustainable. The retirement age of the baby boom generation is almost at our door, and the proportion of the retired population will grow rapidly within the near future. There will be fewer people to pay for the health and social care of the quickly aging population. The rather recent report from the OECD includes Finnish health care, and it clearly indicates that inequality to access of the services has started to grow. Lower income citizens do not have access to the same number of services as those with a higher standard of living. Sitra, the Finnish Innovation Fund, started its Health Care Programme at the beginning of 2005. Our intention was to help municipalities to modernize the service system and improve its efficiency. We quickly learned that there is an intimate symbiosis between health care service procurement and supply; when the service buyer and supplier are one, there is no imminent need to optimize cost or quality. A clear separation between purchase and supply would immediately call for significant change in the transparency of cost and quality indicators. In 2006, Professors Michael E. Porter and Elisabeth Olmsted Teisberg authored a book Redefining Health Care, Creating Value-Based Competition on Results. One of the key messages of this book is to move from an activity based service system to a new approach where the patient is in the centre and where his or her health outcomes are given the guiding role. Quite soon after this, Parliamentary elections took place in Finland in early 2007. In its publicly available plan, the new government wanted to profoundly renew the legislation concerning health and social care. Hopefully, the new emerging laws will enable the further evolution and modernization of the Finnish health and social services and for them to be maintained at the best

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possible standard. Here at Sitra, we were fortunate enough to bring together Professor Michael E. Porter and some of the best experts on the Finnish health care system from the Ministry of Social Affairs and Health. It was jointly agreed to produce a white paper titled The Finnish Health Care System: A ValueBased Perspective. It is in our best interest that this new document will help those responsible for the Finnish health and social care system to create a vision and strategy to maintain and improve our nationally available services in a sustainable way for the years to come. On behalf of Sitra, I would like to sincerely thank the authors of this document, Dr Juha Teperi, Dr Michael E. Porter, Dr Lauri Vuorenkoski and Ms Jennifer F. Baron, for their invaluable contribution. I wish to extend my gratitude also to the Ministry of Social Affairs and Health for the opportunity of the Finnish authors to give their signiﬁcant contribution to this document.

Hannu Hanhijärvi Executive Director Sitra, the Finnish Innovation Fund

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List of abbreviations DRG EPR EU EU15 Finohta GDP HTA IPU MSAH NAM NAMLA NHI OECD PHC ROHTO RAY SII Sitra Stakes THL TEH Tekes

Diagnosis Related Group Electronic Patient Record European Union Countries that joined European Union before 2004 Finnish Ofﬁce for Health Technology Assessment Gross Domestic Product Health Technology Assessment Integrated Practice Unit Ministry of Social Affairs and Health National Agency for Medicines National Authority for Medicolegal Affairs National Health Insurance Organisation for Economic Co-Operation and Development Primary Health Care Centre for Pharmacotherapy Development Slot Machine Association Social Insurance Institution Sitra, the Finnish Innovation Fund National Research and Development Centre for Welfare and Health National Institute for Health and Welfare Total Expenditure on Health Finnish Funding Agency for Technology and Innovation

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Contents

Foreword

List of abbreviations

About the authors

Tiivistelmä Arvoon perustuva terveydenhuolto Suomalainen terveydenhuolto arvoon perustuvasta näkökulmasta tarkasteltuna Kokonaisarvio ja suositukset

15 15

Introduction

Principles of value-based delivery The fundamental goal is value for patients The only way to truly contain cost and increase value is to improve health outcomes Care should be organized around medical conditions over the full cycle of care Value is increased by provider experience, scale, and learning at the medical condition level

23 24

16 18

25 26 29

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Value must be universally measured and reported Reimbursement should be aligned with value and reward innovation Competition should occur for patients based on value, while encouraging the restructuring of care Electronic medical records must enable the restructuring of care delivery, support integrated care and produce outcome measures Health plans or funding agencies should contribute to value, rather than act as passive payers

III

Overview of the Finnish health care system

Access and standards for coverage Municipal health care system National health insurance system Private insurance Occupational health care system Assessment

39 40 42 42 43 44

Structure of health care delivery Providers Employers Patients Suppliers Clinical guidelines

47 47 72 74 78 81

Health information technology Assessment

83 84

VII

Results measurement Use of measurement data in health care management Assessment

86 91 92

31 33

34 34

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VIII Overall assessment and recommendations Intensify outcome measurement and link it to incentives and management Create integrated practice units Strengthen primary health care Create true health plans Reimburse full cycles of care Increase value by service consolidation combined with competition Encourage innovation in care delivery and its structures Invest in health information technology Increase the role of patients in health care Moving to action

References

94 95 97 100 102 103 105 106 108 110 112

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About the authors Jennifer F. Baron, MBA, MPH Senior Researcher, Institute for Strategy and Competitiveness, Harvard Business School Jennifer Baron is a Senior Researcher at the Institute for Strategy and Competitiveness, managing a growing body of domestic and international health care work. Her current research includes US and other advanced economy health system analysis, health care policy and reform, and approaches to health care delivery in resource-poor settings. Jennifer earned her MBA from Yale School of Management, her MPH from Yale School of Public Health and her BA from Georgetown University.

Michael E. Porter, MBA, PhD Bishop William Lawrence University Professor, Harvard Business School Michael E. Porter is a Bishop William Lawrence University Professor at Harvard Business School. A leading authority on competitive strategy and the competitiveness of nations and regions, his work is recognized by governments, corporations, nonproﬁt organizations and academic circles across the globe. Professor Porter has recently devoted considerable attention to understanding and addressing the problems in health care evident in the United States and abroad. His book, Redeﬁning Health Care (with Elizabeth Teisberg) develops a new framework for understanding how to transform the value delivered by the health care system. For more information, visit the Institute for Strategy and Competitiveness website at www.isc.hbs.edu.

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Juha Teperi, MD, PhD Juha Teperi was trained as a medical doctor and health services researcher at the University of Helsinki. After working as a researcher in Finland and abroad, Dr Teperi has held various senior management positions in Stakes (National Research and Development Centre for Welfare and Health) since 1997. In August 2007, he moved to the Ministry of Social Affairs and Health, in order to head a national service innovation programme in health and social care. Dr Teperi has published extensively on health technology, health services and health policy.

Lauri Vuorenkoski, MD, PhD Lauri Vuorenkoski is a senior researcher at the National Institute for Health and Welfare (THL). He is trained as a medical doctor and received a PhD in child psychiatry from the University of Oulu in 2001, after which he worked at THL and its predecessor Stakes. He has recently authored the book Finland: Health System Review for European Observatory on Health Systems and Policies series. Currently, he is working part time as a health policy expert in the Finnish Medical Association.

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Tiivistelmä

Tässä raportissa on kolme osaa, joista ensimmäinen esittelee ”arvoon perustuvan terveydenhuollon” periaatteet. Toisessa kuvataan Suomen terveydenhuoltoa niin, että rakenteita ja toimintaa arvioidaan suhteessa näihin periaatteisiin. Kolmannessa osassa annetaan suosituksia suomalaisen järjestelmän kehittämisestä arvoon perustuvan terveydenhuollon suuntaan. Raportin tavoite on antaa aineksia laajapohjaiselle keskustelulle terveydenhuollon kehittämisestä, eikä se esitä yksityiskohtaisia ehdotuksia.

Arvoon perustuva terveydenhuolto Michael E. Porterin ja Elizabeth Olmstead Teisbergin vuonna 2006 ilmestyneessä ”Redeﬁning Health Care” -teoksessa hahmotellaan strateginen viitekehys tulevaisuuden terveydenhuollolle. Porter ja Teisberg kutsuvat tavoittelemaansa ihannemallia nimellä ”value-based health care” (”arvoon perustuva terveydenhuolto”). Terveydenhuollossa arvo on potilaille (tai sairastumisvaarassa oleville) tuotettu terveys suhteutettuna käytettyihin voimavaroihin. Arvoon perustuva terveydenhuolto tarkoittaa tehokkaasti terveyttä tuottavaa järjestelmää. Nykyisiä terveydenhuoltojärjestelmiä ei ole organisoitu tuottamaan tehokkaasti terveyttä. Nyt niiden tärkein tuotos näyttäisi olevan hoito, ei terveys. Porterin ja Teisbergin johtoajatus on se, että tulevaisuuden terveydenhuollossa kaikkien toimijoiden toiminta tähtää yhteiseen maaliin, arvon tuottamiseen. Terveydenhuollon organisaatiot sovittavat toimintansa vallitseviin pelisääntöihin. Arvoon perustuvan terveydenhuollon säännöt on laadittu niin, että parhaiten terveyttä tuottavat organisaatiot menestyvät. Kustannusten siirtämistä toisille toimijoille ei palkita, ei myöskään oman organisaation tulojen varmistamista kokonaishyödyn kustannuksella. Terveyden tehokas tuottaminen hillitsee kustannuksia kestävästi. Hoito on järjestettävä potilaan terveysongelman mukaisesti yhtenä kokonaisuutena. Hoitoa ei pidä pilkkoa erillään tuotettuihin ja erillään rahoitettuihin osiin. Arvon tuottaminen vaatii osaamista, jonka varmistaa tarpeeksi suuri palvelujen määrä kussakin tuottajaorganisaatiossa.

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Pelisäännöt eivät riitä, jos hoidon vaikutuksia terveyteen ja kustannuksiin – siis arvoa – ei seurata kattavasti. Palvelun järjestäjien ja rahoittajien merkitys on ratkaiseva arvoon perustuvassa järjestelmässä. Niiden on aktiivisesti varmistettava kohdentamiensa voimavarojen terveyshyöty. Palvelutuotannon hinnoittelu- ja korvausjärjestelmät tukevat arvon tuottamista ja uudenlaisia toimintamalleja. Kilpailun pitää perustua paremmuuteen arvon tuottamisessa ja sen on rohkaistava rakenteellisiin uudistuksiin. Sähköisten potilastietojärjestelmien on tuettava palvelutuotannon uudistamista ja varmistettava hoitoprosessin tulosten hahmottuminen yhtenä kokonaisuutena.

Suomalainen terveydenhuolto arvoon perustuvasta näkökulmasta tarkasteltuna Suomen terveydenhuolto oli monessa suhteessa takaperoinen vielä 1960-luvulla. Nyt se on johtavien järjestelmien joukossa. Se on pystynyt kohtuullisin kustannuksin tarjoamaan laajan palveluvalikoiman harvaanasutussa maassa. Kansainvälisten mittareiden valossa järjestelmä tuottaa terveyttä melko tehokkaasti ja kansalaiset ovat siihen kokonaisuutena tyytyväisiä. Suomalainen terveydenhuolto perustuu valtaosaltaan julkisesti tuotettuihin, pääasiassa verorahoituksella maksettuihin palveluihin. Perustuslain mukaan julkisen vallan on tarjottava riittävät palvelut kaikille. Valtiovallan tehtävä on määritellä terveydenhuollon yleiset kansalliset linjaukset. Sosiaali- ja terveysministeriö valmistelee terveydenhuoltoa ohjaavan lainsäädännön, määrittää uudistusten ja kehittämistoimien yleiset päämäärät sekä seuraa ja ohjaa niiden toteutumista. Kunnilla on vastuu palvelujen järjestämisestä. Kuntaverotuksen, valtionosuuksien ja käyttäjämaksujen turvin ne tuottavat valtaosan palveluista itse tai keskinäisinä yhteenliittyminä. Kunnat järjestävät palveluja myös ostamalla niitä yksityisiltä ja ns. kolmannen sektorin tuottajilta. Vähän käytetty malli on hankkia palveluja julkisilta yksiköiltä oman alueen ulkopuolelta. Perusterveydenhuollon palveluja tuottaa noin 250 terveyskeskusta. Perustason sairaanhoidon lisäksi ne tarjoavat ehkäiseviä palveluja ja osallistuvat kunnan asukkaiden terveyden edistämiseen. Monista muista maista poiketen perustason yksiköihin on koottu hyvin monialaista osaamista. Terveyskeskuspalvelujen saatavuus on viime vuosina huonontunut. Erikoissairaanhoitoa varten kukin kunta kuuluu yhteen 20 sairaanhoitopiiristä, joista kussakin on yksi tai useampi sairaala. Kunnat ohjaavat piirien toimintaa niiden valtuustojen ja hallitusten kautta. Alueellisesti toimivilla sairaaloilla ei juuri ole kilpailijoita. Jokainen sairaala tuottaa laajan kirjon palveluja, joista osan pienille potilasmäärille.

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Suomessa pysyvästi asuvat henkilöt kuuluvat pakollisen sairasvakuutuksen piiriin. Se korvaa osan potilaiden itse hankkimien terveyspalvelujen kustannuksista. Yksityiset palvelut painottuvat erikoislääkäreiden avohoitokäynteihin. Sairaalahoidoista viitisen prosenttia tuotetaan yksityisissä sairaaloissa. Työterveyshuoltoa varten on oma rahoituskanava. Se perustuu pakolliseen työtulovakuutukseen, joka rahoitetaan työntekijöiden ja työnantajien maksuilla. Työterveyspalveluja tuottavat niin kunnalliset ja yksityiset toimijat kuin suurien yritysten omat työterveysyksiköt. Monet asiantuntija-arviot ovat kiinnittäneet huomiota rinnakkaisten rahoituskanavien luomiin ongelmiin. Uudistuksia on tehty lisäämällä uusia malleja entisten rinnalle. Näin on syntynyt kannustimia siirtää kustannuksia toisten kannettavaksi. Rahoituskanavien runsaus ohjaa omien tulojen varmistamiseen kokonaishyödyn kustannuksella. Terveyden tehokas tuottaminen estyy. Monikanavaisuus myös kohdentaa monia terveyspalveluja hyvässä taloudellisessa asemassa olevia suosien. Ikääntyneiden pitkäaikaista hoivaa tarjotaan kotiin annettuina palveluina, palveluasunnoissa, vanhainkodeissa ja terveyskeskuksissa. Kolme ensin mainittua ovat useimmiten osa kunnallista sosiaalitoimea tai yksityistä palvelutuotantoa. Eri palvelumuodoissa rahoitus perustuu eri painotuksin kunnalliseen rahoitukseen, sairausvakuutukseen ja asiakasmaksuihin. Monikanavainen palvelujen rahoitus estää ikääntyvän väestön palvelujen linjakkaan kehittämisen. Lääkekustannukset ovat Suomessa nousseet muita terveydenhuollon menoja nopeammin – muiden maiden tapaan. Lääkekustannukset katetaan kahta kautta. Laitoshoitopotilaiden kustannuksista vastaa kunnallinen terveydenhuolto. Muuten lääkekustannuksia korvaa porrastettu sairausvakuutus niin, että käyttäjien rahoitusosuus on kansainvälisesti vertaillen korkea. Rinnakkaiset rahoitusmallit vaikeuttavat lääkehoidon niveltämistä kiinteäksi osaksi hoitoprosessia. Potilaiden asemaa on viime vuosina vahvistettu. Suomi oli ensimmäisiä maita, jossa säädettiin erillinen laki potilaiden oikeuksista. Potilaiden mahdollisuus valita palvelunsa kunnallisen järjestelmän sisällä on ollut kansainvälisesti vertaillen rajallinen. Useimpien palvelujen käyttäjämaksut ovat kohtuullisia, mutta mm. lääkkeiden, hammashuollon ja yksityisten palvelujen korkeat omavastuuosuudet nostavat kotitalouksien suorien maksujen osuuden terveydenhuollon rahoituksesta korkeammalle kuin useimmissa muissa Euroopan maissa. Sähköiset sairauskertomukset on Suomessa otettu käyttöön kattavammin kuin useimmissa muissa maissa. Sähköisen tietohallinnon hyödyntäminen hoitoprosessien uudistajana on kuitenkin vielä toteuttamatta. Sairaalahoitoja koskeva rekisteri- ja tilastotuotanto toimii, mutta perusterveydenhuollon tie-

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topohja on heikko. Johtamiseen kytketyt tuottavuuden ja vaikuttavuuden seurantajärjestelmät ovat vasta idullaan.

Kokonaisarvio ja suositukset Viime vuosikymmenten saavutukset luovat pohjan tuleville uudistuksille. Taloudellisesti kestävästi toteutettujen palvelujen järjestäminen yhtäläisesti kaikille Suomessa asuville säilyy välttämättömänä tavoitteena, mutta se ei yksin riitä. Palvelujen tuottaman terveyshyödyn lisääminen hyödyttää yksittäistä potilasta ja varmistaa sekä taloudellisesti että sosiaalisesti kestävän palvelutuotannon. Alueelliseen järjestämisvastuuseen ja julkiseen rahoitukseen perustuva kaikille avoin järjestelmä on mahdollistanut viime vuosikymmenten kiistattomat saavutukset. Samalla on syntynyt tilanne, jossa palvelutuottajien ei ole tarvinnut kilpailla keskenään kyvyllä tuottaa mahdollisimman paljon terveyttä. Kannustimet palvelujen ja niitä tuottavien organisaatioiden uudistamiseen ovat jääneet heikoiksi. Moni raportin suosituksista liittyy ajatukseen kilpailun vahvistamisesta terveydenhuollossa. Kilpailu ei ole tavoite itsessään, vaan työkalu ja käyttövoima palvelujen kehittämiselle. Kilpailun lisääminen ei ole kannanotto julkisen tai yksityisen palvelutuotannon paremmuuteen. Kilpailua tarvitaan kenties enemmän julkisen tuotannon sisällä kuin julkisen ja yksityisen välillä. Toimet palvelutuotannon arvon lisäämiseksi eivät onnistu, ellei tulosten mittaamista ratkaisevasti vahvisteta. Jo nyt on tarjolla useita mittausjärjestelmiä, joiden käyttö on vähäistä. Tarvitaan myös terveystulosten uusien mittausjärjestelmien kehittämistä. Sekä vanhat että uudet mittausjärjestelmät on kytkettävä kannustin- ja johtamisjärjestelmiin. Suomalaisessa terveydenhuoltojärjestelmässä on useita sellaisia integraatiota vahvistavia rakenteita, joihin muualla vasta pyritään. Terveyskeskukset kokoavat yhteen mittavan määrän osaamista. Valtaosa ihmisten terveysongelmista voidaan ratkaista tehokkaasti ja taloudellisesti lähellä heidän arkeaan ja yhteisöjään. Kääntöpuolena on se, että perusterveydenhuollon ja erikoissairaanhoidon välinen raja jakaa vastuun monien terveysongelmien hoitamisesta liian erillisille yksiköille. Yhtäältä tarvitaan esimerkiksi merkittäviin kansansairauksiin erikoistuneita hoitoyksiköitä, jotka yhdistävät erikoissairaanhoidon ja perusterveydenhuollon toimintoja yhden johdon ja budjetin alle. Toisaalta tarvitaan perusterveydenhuollon vahvistamista vastaamaan niihin haasteisiin, jotka eivät liity tiettyyn sairauteen: perusterveydenhuollon toimintayksiköiden on erikoistuttava esimerkiksi yleensä terveiden lasten ja työikäisten terveyden ylläpitämiseen, raihnaiden iäkkäiden hoitoon sekä monisairaiden hoitokokonaisuuden koor-

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dinointiin. Perusterveydenhuollon erityinen vahvuus on saumaton yhteistyö sosiaalipalvelujen kanssa. Monissa terveydenhuoltojärjestelmissä maksajan rooli jää passiiviseksi. Suomessa palvelujen järjestämisestä vastaavat nykyään kunnat, ja niillä on vaikeuksia ohjata erityisesti erikoissairaanhoitoa tehokkaampaan suuntaan. Palvelun järjestäjälle on luotava kannustimet ja työkalut ohjata potilaita palveluihin terveyshyödyn mukaan, ei maantieteeseen tai palveluorganisaation omistajuuteen perustuen. Palvelujen järjestäjän roolin vahvistamiseksi on selkeytettävä yksityisen työterveyshuollon ja muun yksityisen palvelutuotannon suhdetta kuntien järjestämään erikoissairaanhoitoon. Ratkaiseva uusi näkökulma liittyy palvelujen hinnoitteluun. Yksittäisistä toimenpiteistä, hoitojaksoista tai käynneistä maksamisen sijasta tulisi palkita terveysongelman ratkaisemisesta. Tämä tarkoittaa niputettua hinnoittelua. Palvelutuottaja saa korvauksen terveyden palauttamisesta mahdollisimman hyvälle tasolle, riippumatta käytetyistä toimenpiteistä. Näin estetään palvelujen perusteeton säännöstely ja niiden ylituotanto sekä rohkaistaan etsimään kokonaan uusia palvelumalleja. Suomessa pienetkin sairaalat pyrkivät tuottamaan mahdollisimman laajaa palveluvalikoimaa. Tuottavuus- ja laatuhyödyt jäävät saavuttamatta, kun terveystuloksiin perustuvaa kilpailua ei ole ja potilasmäärät ovat pieniä. Organisaatioiden pitää erikoistua. Samalla on otettava riittävästi huomioon palvelujen saatavuus. Terveydenhuollon kehittämiseen on suunnattu runsaasti tutkimus-, kehitys- ja innovaatiorahoitusta. Vaikutukset uudistuneina palveluina eivät ole vastanneet tehtyjä investointeja. Syynä on osin ollut terveyshyötyyn perustuvan kilpailun puuttuminen ja heikot uudistumisen kannustimet. Tulosten mittaamisen ja siihen perustuvan kilpailun lisäksi tarvitaan uusia tapoja tilata palveluja. Julkisilta ja yksityisiltä tuottajilta palveluja tilattaessa tulee siirtyä pitkäaikaisiin, koko hoitokokonaisuuden kattaviin ja terveyshyötyihin sidottuihin sopimuksiin. Informaatioteknologian käyttöä palvelutuotannon uudistamisessa hidastaa terveydenhuollon järjestämisvastuun pirstaleisuus. Viime vuosina on otettu lupaavia edistysaskeleita, mutta vauhti ei riitä. Nyt tarvitaan laaja-alainen konsensus vahvasta kansallisesta ohjauksesta ja voimavaroista informaatioteknologian hyödyntämiseen. Potilaan rooli on liian passiivinen. Potilaan aseman vahvistaminen aktiiviseksi toimijaksi lisää terveydenhuollon tuottamaa arvoa monella tavalla. Sekä ehkäisyn että pitkäaikaissairauksien hoidon tulokset riippuvat paljolti niistä päätöksistä, joita suomalaiset tekevät omista elintavoistaan. Usein potilas on oman sairautensa hoidon paras asiantuntija. Oikein toteutettuna potilaan valinnan vapauden lisääminen vahvistaa terveydenhuollon kannustimia kehittyä yhä tehokkaammin terveyttä tuottavaksi kokonaisuudeksi.

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Introduction

In only a few decades, Finnish health care has developed from a somewhat rudimentary health care system into one that is internationally acclaimed. Every permanent resident in the sparsely populated country has access to an extensive set of services, yet total per capita health care costs remain lower than in most comparable countries. Despite recent concerns about equity issues, Finns are generally very satisfied with their health care services. However, as in any country, Finland cannot rest on its laurels. Advancing medical science raises a new bar for quality in terms of the outcomes achieved in the treatment of illness. An aging population and rising public expectations threaten to increase costs and impede timely access to care, thus jeopardizing sustainability. One challenge in particular, the aging Finnish workforce, affects not only patient demographics but also the availability of clinicians. The upcoming wave of retiring health care professionals will occur at just the time when Finland will need more of them. To overcome these challenges, every health care system will have to use its resources more effectively; the achievements of past decades are to be maintained and built upon. Access and equity will remain necessary characteristics of optimal health care systems, but they are insufficient goals in terms of improving quality and achieving financial sustainability. Instead, the value created by the system as a whole must be continuously improved; for each euro spent, more health needs to be achieved. The large variations in health care quality and costs have been described and documented in many advanced economies, signalling a lack of consensus concerning best practices, not only in individual care processes but also in the organization of care delivery itself. Finnish researchers, for example, have shown that outcomes like disease-specific mortality rates vary across and even within providers in a way that cannot be explained by the severity of the condition or other initial patient conditions. A similar variability exists in the costs

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of care. Often, there is no significant correlation between condition-specific health outcomes and their respective costs. Thus, lower costs are not associated with worse outcomes. Similarly, higher spending often does not result in better care. Most health care systems have not yet addressed these issues. In many health care systems, data on health outcomes and costs is crude or nonexistent, masking the extent of variability and inhibiting providers’ ability to improve substandard models and more closely examine those that succeed. Another obstacle to redefining health care delivery is the reliance on anachronous structures and care processes. In the era of chronic conditions, one component of cost-effectiveness is the ability to manage disease within the context of patients’ everyday lives. Yet most services require patients to visit physician offices or to be admitted to hospitals, which can be both inconvenient and costly. In 2006, Porter and Teisberg published Redefining Health Care (HBS Press), a new framework for health care delivery based on value for patients, defined as health outcomes achieved per unit of cost spent. The authors drew upon decades of experience analyzing strategy, organization and management issues in other industries to formulate a set of value-based principles for health care delivery. This framework provides a powerful new lens with which to examine health systems in any country. The most appropriate and effective ways to implement value-based care delivery models will depend on the particular circumstances of each setting. This report seeks to examine the current state of the Finnish health care system and accelerate the identification and implementation of value-based reforms within the Finnish context. It aims to contribute to the discussion and introduction of value-based reforms in Finland that are already underway. This report consists of three parts. Section 2 presents a brief overview of the general principles of value-based care delivery. Sections 3 to 7 then utilize these principles to analyze the Finnish health care system as it looks today. While the text aims to cover the essential features of the Finnish system, special attention is paid to aspects that are crucial from a value-based perspective. Finally, Section 8 proposes a set of general conclusions and recommendations for Finland. The aim is not to provide a comprehensive road map for Finnish health care; rather, the recommendations highlight the key implications of a value-based approach to strategic decisions in Finnish health care policy. The aim is also not to lay out in detail how health care in Finland should look, or how individual policies to achieve a value-based system should be designed and implemented, but to offer an overall strategic framework together with the major directions of the change required.

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The principal goal of this report is to catalyze discussion in Finland. If these recommendations help key stakeholders engage in mutual dialogue aimed at deﬁning common goals conducive to improving the health of the Finnish people, this exercise has been worthwhile.

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Principles of value-based delivery

The reform of a national health care system has historically been approached from an issue-by-issue perspective, with reforms focused on solving individual problems such as cost, reimbursement, incentives, prevention, IT, safety, privatization or primary care. Lacking is an overall normative framework for the optimal organization of the system as a whole, and the appropriate roles of individual system actors. Many health professionals themselves were frequently unaware of the overall operation of their own health care system, and focused solely on the parts in which they participated. Today, faced with aging populations and rising health care costs, governments and other stakeholders across the globe are pursuing health care reforms with a new sense of urgency. Particularly in advanced economies, analyses of health care system performance are becoming more prevalent. While many of these efforts contain valuable insights and they have served as resources for this paper, a systematic approach based on a rigorous normative framework has been absent. We can examine any health care system using the framework introduced recently by Michael Porter and Elizabeth Olmsted Teisberg in Redefining Health Care (Porter and Teisberg 2006, see also Porter 2008). The value-based delivery framework is based on the central goal of value for patients, defined as health outcomes achieved per unit of cost spent. It offers general principles for how providers, patients, payers, employers, government and the health care system as a whole can maximize value. Every health care system aims to improve value through better health outcomes and more efficient care, but no system is currently organized around value. Underlying the failure to focus on value is a misconception that health care, and not health, is the output. When health care is viewed as a product, it naturally follows that universal and equitable coverage is the end goal, or providing all citizens with access to care. However, from the patient perspec-

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tive it is clear that care itself is not the goal but merely a means to achieve and maintain good health. Given a choice between more care and more health, a patient’s choice is obvious. But health care systems around the world remain organized to deliver treatment, not to maximize health and the efﬁciency with which it is achieved. How can Finland and other countries move toward a health care system that will continuously improve value? A value-based system is based on a series of core principles that begin by clearly deﬁning the goal and move to the structure of health care providers, which are at the heart of the system. Then the roles of payers, patients, employers, suppliers and government follow. Each actor must contribute to value through its choices and priorities.1 Every country, like Finland, has its own unique history and starting position, and thus different strengths and weaknesses. However, many health care systems share a set of common problems, largely due to the similar historical structure of medical practice in every country.

The fundamental goal is value for patients Providing access to care is surely important, but the purpose of a health care system is to deliver good value for patients, which is deﬁned as the health outcomes achieved per euro spent. Universal and equitable coverage is essential to a valuebased health care system, but it is not enough. While this might sound simple, it rarely occurs in practice. Increasing access without improving value will yield poor health outcomes while leading to unsustainable cost increases. It is impossible to have a truly high-value system without universal coverage. The United States is a prime example of the ill effects of a large uninsured population without access to primary and preventive care, the prevalence of late and expensive acute treatment, and the distortive effect of cross-subsidies to care for the uninsured. However, even countries like Finland that have achieved universal coverage are encountering both rising health care costs and uneven quality of care. How universal access is achieved, then, is important to value. In many countries, inadequate risk pooling across individuals means that payers focus on selecting healthier individuals, selectively contracting to achieve discounts, or limiting services, rather than measuring and improving member health. The goal is to increase value, not just contain costs. Value is measured by the overall health outcome achieved relative to the total costs of care over the full cycle of the patient’s illnesses. Value-based health care delivery seeks to minimize the overall cost of care, not focus just on minimizing the cost of 1 A detailed discussion of these principles is contained in Redeﬁning Health Care, especially chapters 4–8. See also “What is Value in Health Care”, Institute for Strategy and Competitiveness discussion paper, 2008.

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individual services or interventions. Value-based care delivery spends more on appropriate services in order to save through early intervention, reducing mistakes, minimizing complications, and forestalling disease recurrences. In many countries, providers focus on volume, not value. This leads most providers to offer full services, rather than those services where they are truly expert and cost effective. The result is access to care but lower value in the care actually delivered. Value is the goal, not whether the providers are public or private, and non-proﬁt or for-proﬁt. In countries with public systems, for example, contracting with private providers should focus on value, not outsourcing per se. Outsourcing should be a tool for stimulating the measurement of value and improvements to the public system.

The only way to truly contain cost and increase value is to improve health outcomes Ironically, setting a goal to reduce costs is one of the surest ways to increase the costs of long-term health care. The activities and programmes often rationed or cut in order to control costs are frequently among the highest-value. Much cost control is really cost shifting or cost delaying rather than cost reduction. For example, a system seeking to reduce spending often chooses to scale back on office visits and consultative care, even though these produce better diagnoses and patient engagement in managing their disease. Insurers limit the use of diagnostic imaging that detects problems early or leads to better diagnoses, and raise co-payments for costly medications for chronic conditions, which then leads to less patient adherence and costly complications, and payers cut back on mental health or social services, which then creates the need for expensive inpatient or institutional care. In the near term, costs may in fact decrease. Over the longer term, costs are higher and outcomes are worse. In the medium and long run, the best way to contain costs is to improve quality (Midwest Business Group on Health 2003, Fuhrmans 2007, Porter and Baron 2008). Better health is less expensive than poor health. This basic truth is magnified when the full costs to society of poor health are taken into consideration (e.g. poor worker productivity and the ability to maintain employment and live independently). How does better quality drive down costs? This starts with prevention of disease through healthier living practices, which forestall the need to treat illness; early detection usually improves the ability to achieve a good outcome, while significantly reducing costs. An accurate diagnosis makes a good outcome more likely due to appropriate care. Faster treatment often improves outcomes while reducing costs, and so on.

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The best way to achieve cost containment in health care is to drive quality improvement, where quality is health outcomes. Care delivery should be structured to achieve outcome improvements, as should the activities of health insurers, employers, and other actors. Unfortunately, health care delivery is rarely designed this way. What is worse, many health care experts believe that quality improvement is more costly, not less. Instead, health care is one of the ﬁelds where the maxim “quality is free” is most striking.

Care should be organized around medical conditions over the full cycle of care Most care delivery is not currently organized in a way that maximizes value. Care is organized by specialty or intervention, not the multidisciplinary care of the patient’s medical condition whether it be diabetes or breast cancer. Primary care, outpatient care, inpatient care and rehabilitation are separate entities, often with competing interests. In the current system, patients see a sequence of specialists each delivering discrete interventions. Each specialist has separate scheduling, administration, and often billing. Each specialist is also a generalist in his or her ﬁeld, seeing the full range of patients in their specialty, who can have widely varying medical problems. A neurologist cares for stroke patients, migraine headaches and head trauma, for example, and each requires different expertise and coordination with widely differing other providers. Providers involved with a patient work separately and not as a team. There is little communication to determine a coordinated care plan. Even clinicians working within the same hospital are typically organized by functional department. Each time a patient is passed from one department or provider to another, there are administrative costs and delays as well as unnecessary opportunities for miscommunication and value destruction. Moreover, care tends to be measured and improved in the way it is organized; surgeons focus on improving their surgery as if this determined value, even if a non-surgical intervention would be a better value or the value created by the procedure is later negated by improper follow-up care. Value for patients is created by the entire set of activities needed to address a patient’s medical condition, not a single intervention. We term this the cycle of care, which extends from primary and preventive care through to treatment, rehabilitation or long-term management. It may require a few visits or chronic care, depending on the medical condition. A medical condition is a set of interrelated patient medical circumstances best addressed in an integrated way, deﬁned from the patient’s perspective. The medical condition is the unit of value creation in health care. It includes the most common co-occurrences for medical conditions such as diabetes, breast cancer, stroke, asth-

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ma and congestive heart failure. Such co-occurrences will include sequalae or complications resulting from the medical condition in question. The scope of sequalae and other co-occurrences included in each IPU will depend on both the medical condition as well as the patient population. For example, the medical condition of diabetes involves renal disease, eye disease, cardiovascular complications as well as foot and other circulation problems. Diabetes IPUs serving primarily or exclusively type I patients may include a slightly different set of services than an IPU serving type II patients. IPUs serving older diabetics may also offer different scopes of care than those serving younger individuals. Value-based care delivery is organized around the patient’s medical condition. Value-based care delivery combines the set of specialties and activities required to address a medical condition into a dedicated unit.2 Care is integrated across both specialties and time. The providers involved in care for a medical condition become a true team. The term “integrated” has come to mean many things. Integration is different from coordination; multidisciplinary provider teams actually work together to maximize coordination and minimize the need for handoffs. Care integration is improved by the co-location of providers in dedicated facilities (Porter and Teisberg 2006). Value-based care delivery therefore requires integrated practice units (IPUs). IPUs include the specialties and services necessary during the cycle of care, including those needed to anticipate and to treat common co-occurrences and complications. In diabetes care, for example, specialists in cardiovascular disease, kidney disease, eye disease, podiatry and other diseases should be part of the integrated practice unit. IPUs involve dedicated physicians and staff who are expert in the medical condition. In a diabetes IPU, the nephrologists are experienced in managing the complications of diabetes, not generalists in renal problems; similarly, social workers are expert on the issues of diabetes control. Some specialists may work part-time in an IPU, depending on the volume of patients. IPU boundaries for a particular medical condition can vary for particular patient populations. For example, a team serving primarily elderly patients may require additional social services to maximize the value of care that are not necessary for a provider serving a younger population. IPUs should provide care in a single dedicated facility in which all necessary services are conveniently located in order to maximize both patient and provider efﬁciency and effectiveness. Less complex services in the care cycle 2 Professor Michael E. Porter and his colleagues at the Institute for Strategy and Competitiveness at Harvard Business School are developing a body of case studies highlighting organizations moving toward value-based care delivery approaches. Proﬁled organizations include The University of Texas MD Anderson Cancer Center, The Cleveland Clinic, The West German Headache Center, and The Joslin Diabetes Center. A complete list of published and inprogress case studies is available on the Institute website at http://www.hbs.edu/rhc/health_ care_delivery_curriculum.html.

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may be provided at separate locations convenient to the patient, but they need to be managed by the same organizational unit in order to achieve true coordination and the integration of care. IPUs should have a single administrative structure to schedule appointments, assemble records, communicate with patients and ensure follow-up. The IPU model is designed to bring together the expertise in a medical condition and seamlessly integrate the care needed by every patient with that condition. In a value-based system, patients with multiple unrelated medical conditions will be treated by more than one integrated practice unit. In this case, an additional coordinating structure is needed, which may be the primary care physician or a dedicated unit designed to coordinate care for particularly complex patients such as the elderly or disabled. In the IPU model, coordination for multiple conditions can rely on a single team captain. In contrast, today’s care delivery models require that each individual clinician serving a complex patient attempts to coordinate with all the others involved in that patient’s care, which is not practical or effective even if there is one designated coordinator.

Patient involvement The IPU structure greatly facilitates the patients’ engagement in their care compared to current structures. Health and health care value are co-produced by the patient and clinician, so that the patient must be a member of the care delivery team. Patient adherence to drug or other treatment regimens, compliance with scheduled appointments, and lifestyle modiﬁcations are some of the ways in which patient involvement has a major inﬂuence on value. Patient involvement is also essential to success in preventive care and disease management. Today’s fragmented systems, organized around discrete interventions, work against patient engagement and involvement for a number of reasons. When patients see many clinicians across multiple sites, no individual provider has the time or responsibility to ensure that patients understand what is expected of them. Because each provider is seeing multiple types of patients with different diseases, attention on patient engagement can necessarily be limited. The complexity and delays introduced by multiple, uncoordinated visits leads to confusion over patient responsibilities, missed appointments, uncertainty about who to ask for guidance regarding medications or treatment and the lack of a clear point of contact. No single unit has the time or scope to focus on education or compliance. In contrast, the IPU structure easily incorporates educators, case managers or other patient interfaces within the care delivery team. Such staff are in a position to work closely with patients, and all the relevant providers identify

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adherence problems and deal with them. The IPU model dramatically raises the efﬁciency of patient engagement and spreads its cost over the patient’s total care, and not one intervention.

The role of primary care Primary care is an essential element of any health care delivery system. Primary care involves a set of services that include preventive care and screening, and they address the routine health problems that are necessary for every individual. Primary care is also the locus for initial diagnosis and guiding patients to the appropriate IPU or IPUs. IPUs for medical conditions make primary care more effective, and do not replace it. IPUs offer a much more effective structure for caring for the patient’s medical condition, which will coordinate and divide responsibility better with the primary care practice (PCP). Primary care practices will also often supervise ongoing disease management in close collaboration with IPUs. PCPs, then, should act as intake mechanisms and follow up mechanisms for more complex and specialized care. Primary care practices themselves can improve value if the practices are tailored to deﬁned patient populations. A primary care practice equipped to serve elderly disabled patients, for example, can develop expertise, IPU relationships, and structures tailored to the needs of these patients, including home visits and the more intensive use of social services. In a value-based delivery system, primary care practices should be connected to IPUs, and not be seen as stand-alone units. Through partnerships and combined electronic medical records, PCPs and IPUs can leverage handoffs in both directions, providing continuity of care in the most cost effective setting and maximizing patient compliance.

Value is increased by provider experience, scale, and learning at the medical condition level In today’s fragmented care delivery systems, most providers offer a broad range of services but the volume of care for any one service is small. Providers attempting to offer care for virtually every medical condition are rarely good at all of them. When too many providers offer the same types of care, a number of problems arise. By trying to be all things to all people, providers lack the knowledge, facilities and staff to achieve true excellence. They also fail to further improve and expand areas of excellence to serve more patients. Patients and providers would be better off if providers thought more strategically about service line

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choices and offered only the types of care for which they were best equipped and highest value relative to other organizations. When fewer providers care for each medical condition, patient volumes at the medical condition level will increase for most providers. As clinicians achieve greater patient volume for a medical condition, they gain experience, scale, and even more skill, thus improving patient outcomes (Morris 1999, Kizer 2003). A self-reinforcing “virtuous circle” is thereby created in which patient volumes justify dedicated clinical and support teams as well as facilities tailored for effectiveness and efﬁciency in caring for a particular medical condition (Porter and Teisberg 2006, Porter 2008). Dedicated teams accumulate experience more rapidly than ad hoc teams since they continuously care for a single medical condition or a small group of conditions. Higher patient volume allows providers to cover more of the cycle of care for the medical condition. Patient engagement is more effective and efﬁcient. As experience improves, medical innovation accelerates because having treated many similar patients, clinicians are better able to modify and improve care delivery methods. Experience, scale and learning ultimately lead to better patient outcomes that attract more patients and increased patient volume. And so the virtuous circle continues. Value-based health care delivery thinking will lead many providers to narrow somewhat the scope of the medical conditions they treat. However, the value-based model does not imply a movement to single-specialty hospitals (although single-specialty hospitals have a place in a value-based system). Larger providers will continue to offer multiple services. However, care will be organized around integrated practice units for medical conditions rather than departments and divisions.

Value must be universally measured and reported In order to improve value, value must be measured. This begins with outcomes of care and ultimately, the full costs of achieving the outcomes. Measuring and reporting results is critical for innovation and competition to work. Despite this basic truth, comprehensive measurement of actual providerlevel health outcomes is rare in virtually every country; providers tend to be chosen based on reputation, convenience or cost. The virtuous circle relies upon the ability of high-value providers to attract more patients (i.e. through positive-sum competition). This allows those providers to achieve even greater experience and scale and expand services geographically in order to improve the convenience of care.

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Quality measurement efforts are becoming increasingly common around the world but they generally focus on the processes of care rather than true health outcomes (Joint Commission on Accreditation of Healthcare Organization 2005, National Committee for Quality Assurance 2008). Documenting processes of care and evidence-based guidelines can be valuable, especially for interventions that are closely linked to health outcomes. However, process measurement is not a substitute for tracking the actual results of care for three principal reasons. First, no set of evidence-based care delivery guidelines can account for all aspects of care and every possible patient circumstance. Process guidelines are invariably incomplete and for some patients, they may be incorrect. Should providers that withhold care that could be harmful to a patient be penalized for failing to adhere to prescribed process guidelines? Second, while certain types of care may be strongly associated with particular health outcomes, individual patients receiving the same types of care still have different results. Third, process guidelines can stifle innovation. Clinical research is ongoing, while care delivery guidelines are typically slow to change and require consensus from a decision-making body that can be difficult to achieve. Requiring providers to practice medicine in a certain way can effectively freeze the state of care delivery until guidelines are amended. To achieve a high value delivery system, there is no alternative but to measure results in terms of outcomes and costs. Outcomes can only be measured properly at the medical condition level, not the specialty level. Moreover, true outcomes encompass the full cycle of care, and not a single intervention or episode. Those current measurement efforts that do examine actual health outcomes usually focus only on the immediate results of a particular procedure or intervention, such as a surgery, and do not consider the longer-term outcomes of care. Other outcome measurement efforts only track one or two metrics, frequently patient survival, without considering the range of other factors affecting patient health and well-being. Each medical condition will have a unique set of outcome measures (Porter 2007), and the relative importance of particular outcomes will often vary according to individual patient preferences. Finally, to avoid provider or health plan incentives to “cherry pick” healthier patients, outcomes must be risk-adjusted to reflect initial patient conditions.

Reimbursement should be aligned with value and reward innovation Today, care is normally reimbursed in the way it is organized. In practice, this takes place in two ways. One is a global budget, which provides a ﬁxed pay-

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ment irrespective of the actual medical needs of patients. This creates insurmountable incentives to ration care while not encouraging high-value care for each medical condition. The other common payment model is payment for discrete services or inpatient episodes. Payment for individual treatments introduces incentives to deliver more services, regardless of whether they create value within the overall cycle of care. Since complex procedures are often the most generously reimbursed, current payment methods often create financial incentives for these types of care at the expense of potentially high-value services such as prevention, education and consultative care that are often not well reimbursed or reimbursed at all. Like the organization and measurement of care delivery, proper reimbursement should occur at the medical condition level. Payment must shift to bundled prices, or “medical condition capitation”, and they should cover all of the care needed to address a patient’s medical condition. Bundled payments should include the services delivered by all provider types (e.g. inpatient, outpatient, drugs, device), and span the entire cycle of care. For chronic conditions, payments may cover patient care for a period of time (e.g. one payment would cover all of the care for a diabetic patient for one year). Bundled reimbursement focuses attention on maximizing the overall value of care, and encourages care coordination and integration. It leaves providers with the task of best allocating resources and valuing the individual components of care. Bundled reimbursement also rewards improvement and innovation by providers, unlike the typical models that work against them. Bundled reimbursement levels should be adjusted for patient risk or severity levels in order to reward providers for the good management of difficult cases. Supplemental reimbursement mechanisms should be available for unusual or unforeseeable complications, but only for rare circumstances. Overall, reimbursement must shift from individual services to full care cycles at the medical condition level, or for horizontal bundles of services such as overall health management for complicated patients with multiple conditions. Bundled reimbursement is most effective if outcomes are universally measured and reported. This way, there is no risk that providers will try to improve profits by skimping on beneficial care. In an ideal system, bundled prices become price caps, allowing high volume providers to reduce prices and attract more patients. This improves volume and experience even further through the virtuous circle of value.

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Competition should occur for patients based on value, while encouraging the restructuring of care Structured properly, competition can be a powerful force to encourage continuous improvement in value. However, having witnessed the damaging effects of competition on the US system many policymakers are understandably sceptical of the ability of competition to drive value. But not all forms of competition are similar. Actors in the US health care system, and to a lesser extent in many other countries, engage in “zero-sum” competition. This competition shifts revenue and costs from one party to another or restricts services rather than creating value for patients. Zero-sum competition is manifested in over reliance on bargaining power, selective contracting, price discounting, and restricting choice instead of improving the outcomes and efficiency of care. In contrast, value-based, or “positive sum”, competition aligns the success of each actor with value for patients. In such competition, all actors work together to improve value, and the success of one actor does not come at the expense of others, including the patient. In value-based competition, every provider must compete for patients through excellent performance, as does every health plan. In value-based competition involving bundled reimbursement and outcome measurement, profit, or net income, for each actor is aligned with value. Positive-sum competition applies equally to for-profit, non-profit and publicly owned entities. As patients seek care from excellent providers, or enrol in high-value health plans, those organizations will grow and expand, including to new geographic areas. In this way, more patients will ultimately have access to the best care. Value-based competition should extend over geographic boundaries. In most countries, care delivery is highly localized and choice is often limited to providers in a single state or municipality. While much care will be delivered locally, patient value is increased if complex care is provided in high-volume centres. Patient travel for today’s relatively short inpatient stays is much more feasible, and more beneficial, in view of the rising level of sophistication of care. Moreover, excellent providers should be encouraged to expand geographically in order to boost value and allow more convenient care for patients. At the same time, care delivery should be integrated across facilities and regions, rather than organized in stand-alone units. This feeds the virtuous circle of value even more. Although organizations should compete for patients in a value-based system, patients cannot be expected to navigate the health care system alone. Since patients are not health experts, they rely heavily upon their referring physicians and health plans to guide them towards high-value care. The consumer

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alone cannot restructure health care, but consumers will constitute an important force for improvement in a value-based system.

Electronic medical records must enable the restructuring of care delivery, support integrated care and produce outcome measures Information technology has enabled value creation in many industries but it has been slow to penetrate health care. Although electronic patient records, order entry and scheduling systems are becoming common in many countries, the full benefits of IT go far beyond simply automating paper-based systems. Ultimately, IT will support the restructuring of care delivery by organizing data around the patient rather than individual specialties, interventions or administrative functions. IT enables tests, diagnoses, notes and interventions to be collected in a system organized around the total patient. IT systems need to be able to handle and aggregate all types of patient data throughout the full cycle of care and be accessible to all authorized parties. Today’s health care IT systems consist of numerous incompatible applications for departments, functions and administration. A truly integrated medical review system combines all of these aspects in a system that can easily exchange information with others. This requires specific national and international standards for data definition, data architecture and communication protocols. No country has yet moved aggressively enough on standards, and most countries have allowed too many disparate and incompatible IT initiatives and solutions to develop. An essential function of health information technology is the ability to collect, analyze and report results. Properly structured EMRs will allow easy tracking of complete outcomes over the full cycle of care. Although IT alone cannot fix a broken health care system, it can enable a new value-based approach to care delivery and measurement.

Health plans or funding agencies should contribute to value, rather than act as passive payers Health plans play important roles in adding value to health care delivery, such as by accumulating and monitoring subscribers’ overall health circumstances and enabling preventive care and disease management. Health plans can monitor and enhance member compliance with treatment and healthy living practices. They can assist patients in locating excellent providers for their med-

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ical condition, and they can take a leadership role in measuring outcomes, pioneering bundled reimbursement and reorganizing care. Unfortunately, most plans and government authorities still act as passive payers and fail to contribute to value. Staff are ill equipped to contribute to value. Instead, payers in many countries remain preoccupied with cost containment, price discounting and selecting healthier members. Every health plan or payer agency should be required to maintain and report health results by medical condition for every member, adjusted for risks. Only in this way will payers be held accountable for their most important role and will citizens be able to understand whether health premiums, or taxes, are well spent.

*** Many of these principles are vastly different from the way most health care is delivered today. However, all of them have been proven actionable. Individual provider organizations throughout the world are already moving toward value-based care delivery models, without waiting for the government to take the lead. Some health plans are moving to add value, understanding that this is in their self-interest. Other health system actors, such as employers and suppliers, have begun to embrace value-based principles. Some governments have also begun to implement policies in line with value-based principles. The achievements and challenges experienced by these pioneering organizations can serve as a source of information for the progress of a growing number of like-minded efforts now underway across the globe.

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III

Overview of the Finnish health care system

The Finnish health care system has undergone substantial change since the Second World War. In the 1940s, a dense network of maternity and child health clinics were established, which was followed by an almost nine-year increase in female life expectancy over the next decade. (Valkonen, 1983) The 1950s and 1960s saw heavy investment in building hospitals at the expense of other provider types. The new hospital network ultimately recruited 90% of an already small pool of Finnish physicians; at the time, Finland had the third lowest density of medical doctors in Europe after Turkey and Albania. (Teperi & Vuorenkoski 2006) By the latter half of the 1960s, the newly strengthened hospital system found that it could not effectively manage many serious, common health problems such as cardiovascular disease, because the system’s primary care and preventive resources were weak. Gains in life expectancy also slowed during this period as an increase in cardiovascular disease met with inadequate preventive care and early intervention. Life expectancy for Finnish males aged 40 was the lowest in Europe and women ranked only slightly better. The next two decades were dedicated to building up the Finnish network of primary health care centres. The health centres offered a wide range of services within a single facility, including GP services, maternity and child welfare, dental care, school health care, and long-term inpatient care. Simultaneously, new medical schools were established at universities and the number of physicians working in primary health care nearly tripled in only a few years. Population health has improved in recent decades, and life expectancy has increased more rapidly than in other European countries even though Finnish females already live longer than most other Europeans (Finnish males are roughly on par with the rest of the EU). In 2007, the Finnish infant mortality rate was also among the lowest in the world at 2.7 deaths per 1,000 live births.

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Today, the Finnish health care system strongly resembles those in other Nordic countries. It offers universal coverage for a comprehensive range of health services delivered primarily by publicly owned and operated providers funded mainly through general taxation. However, the Finnish system is more decentralized and mixed in its funding than other Nordic countries are. The national administration does not organize services itself, but deﬁnes general health policy guidelines and directs the health care system at the state level. Policy guidance in social security, social welfare and health services fall under the responsibility of the national Ministry of Social Affairs and Health. The ministry sets broad development goals, prepares legislation and other key reforms and oversees their implementation, and it engages in dialogue with political decision-makers. The majority of Finnish health care services are organized and provided by the municipal health care system. Municipalities are legally required to organize adequate health services for their residents. There are currently 348 municipalities in Finland with a median size of less than 6,000 inhabitants. To fund these services, municipalities levy taxes and receive state subsidies. Specialist care in the municipal system is provided by 20 hospital districts, each of which is owned and funded by its member municipalities. Each hospital district has one or several hospitals, one of which is a central hospital. In addition to the public municipal system, Finns can receive partial reimbursement for private health care services through the obligatory National Health Insurance (NHI) system. A separate, third funding mechanism renders occupational health care a distinct form of care, even though occupational services are often delivered by private and municipal providers. While there is some overlap, signiﬁcant differences exist in the scope of services, user-fees and waiting times across the three systems. Total health expenditure in Finland, including long-term elderly care, amounted to 13.6 billion euros in 2006 (2,586 euros per capita), or about 8.2% of GDP versus the OECD average of 9.0%. (Stakes 2008) The comparatively low salaries of Finland’s health care professionals serve as a partial explanation for Finland’s relatively low health care expenditure. However, studies have shown that the unit costs of Finnish hospital services, even after control for wage levels, are the lowest of the four largest Nordic countries. (Häkkinen & Linna 2007) One of the proxy indicators of health care effectiveness is mortality amenable to health care (i.e. avoidable mortality). In a comparative study (Nolte et al. 2003) using an aggregate measure of amenable mortality (not including ischemic heart disease) from 1998, Finland ranked eighth out of 19 OECD countries, behind countries including Sweden and Norway. According to Eurobarometer public opinion surveys, about 70% of Finns believe that their health care system runs “quite well” or “only minor chang-

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es are needed to make it work better” (unpublished). Finland has repeatedly ranked among the top two of the 15 “old” EU member states. However, a recent and more detailed survey showed that Finns’ general satisfaction might not apply equally to all types of health care services. For example, Finns are more worried about the quality of and their access to primary care than are residents of most EU countries. (Special Eurobarometer 2007)

Table 1: Key measures on health and the health care system in Finland and EU15 countries (2005)

Finland

EU avg.

Life-expectancy at birth – Years

78.9

79.4

Infant mortality – Deaths /1,000 live births Obese population –% total pop., BMI>30kg/m2 Population: 65 and over – % total population

3.0 14.1 15.9

3.9 13.4 16.2

Total expend. on health – % gross domestic product Public expend. on health – % total exp. on health Doctors’ consultations – number /capita Acute care bed days – number /capita Practicing physicians – density /1,000 pop. (HC)

7.5 77.8 4.3 0.9 2.4

9.2 76.4 5.8 1.1 3.4

Source OECD Health Data 2007, October 2007

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Access and standards for coverage

The Constitution of Finland states that public authorities shall guarantee for everyone adequate social, health and medical services and promote the health of the population. Every Finnish resident has the right to adequate health services regardless of ability to pay or place of residence. The fair distribution of services as well as costs is one of the principal, longstanding goals of Finnish health care policy. Like all health care systems, Finlandâ&#x20AC;&#x2122;s is the product of a series of consecutive initiatives and reforms. In the Finnish case, however, the reforms have typically not replaced existing structures. Instead, parallel solutions have been introduced to co-exist with the earlier system. As a result, Finland has both an extensive tax-funded municipal care delivery system and an obligatory National Health Insurance (NHI) reimbursement system covering the use of private services. Figure 1 illustrates both the parallel funding and parallel care delivery systems.

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Figure 1. The parallel funding and provision arrangements in Finnish health care

Municipalities / hospital districts

PROVISION

Outpatient Physician visits Dentist visits

71% 59%

16% 41%

Inpatient Care periods

95%

93%

Municipality

13%

Occupational

Private

Municipal

POOLING SCHEME

FUNDING SOURCE

Private providers

70%

User fees

- Municipal taxes - State subsidy (~ 1/4 of expenses)

30%

43%

Medical sickness insurance

Income Insurance

57%

Employers

NHI 1.24% Insured (of income) 0.67% Employers (of salary) 1.97% (50%) State (of tot. expenses) -

Municipal health care system The public municipal health care system organizes the majority of health care services in Finland. Each municipality covers all people registered as permanent residents within its borders. Municipal health centres will also provide essential emergency care to anyone, including residents of other municipalities. Asylum seekers are entitled to the same level health services as permanent residents. In the absence of national minimum coverage standards, each municipality is free to determine its own scope of the services it covers. Generally, the range of services is very broad and includes a wide set of preventive and primary care, specialized care, rehabilitation, long-term-care (together with social services) and dental care. The preventive services include 11–15 antenatal care visits for pregnant women, regular check-ups for virtually all children (0–6 year-olds visit child health clinics, while older children receive school health care services), and services from family planning clinics.

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The scope of specialty care coverage is high in international terms, and even the most expensive diagnostic and treatment procedures are available to anyone at no extra charge. Access to specialized care in the municipal system requires referral from either a municipal or a private physician. The municipal system covers inpatient drugs, but outpatient drugs are reimbursed separately by the statutory National Health Insurance. It is important to highlight the fact that the Finnish health care system is decentralized and national steering is rather weak. Since each municipality determines its own scope of coverage within general limits set by national legislation, a fair amount of variation exists geographically and outpatient service volumes for primary care visits, dental care, mental health care and elective surgery differ across municipalities. Significant age-adjusted variations in outpatient service volumes across five university hospital regions have also been observed. (Häkkinen et al. 2006) The volume of inpatient cases and surgical procedures per capita also vary markedly across hospital districts (adjusted by age and sex), including the treatment of ischemic heart disease (Häkkinen et al. 2002) and orthopaedic surgeries. (Mikkola et al. 2005) Significant differences across municipalities in resource allocation for health care delivery persist after needs adjustment. These differences are due to factors including the differing evolutions of care delivery structures over time in various regions, financial resources, availability of health professionals, and the way in which each population’s health care needs are perceived by municipal decision makers. Substantial variation in waiting times for care among municipalities has been of particular concern, and it has led to national regulation of timely access to services; since 2005, the public system has been required to guarantee immediate contact with a health centre during working hours either by phone or by personal visit. Non-urgent appointments must take place within three working days of a patient’s first contact with the centre. The treatment needs of patients referred to hospitals must be assessed within three weeks of referrals. Hospital clinicians may make assessments based either solely on referrals or through in-person patient examinations. Non-urgent hospital-based treatment must be provided within six months of the assessment. In connection with the 2005 access legislation, the Ministry of Social Affairs and Health (MSAH) developed condition-specific criteria to define the patients for whom non-urgent specialty care guarantees should be granted. These criteria are mainly based on existing national clinical guidelines and have been released for about 190 diseases, treatment groups or conditions and they cover about 80% of non-emergency hospital care. The guidelines are nonbinding, and physicians autonomously decide whether their individual patients need treatment. The true long-term effects of the legislation and MSAH criteria remain to be seen.

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National health insurance system The statutory National Health Insurance (NHI) scheme covers all Finnish residents, and it is run by the Social Insurance Institution (SII) through approximately about 260 local offices all over the country. SII falls under the authority of Parliament, and its responsibilities include coverage of some family benefits, National Health Insurance (NHI), rehabilitation, basic unemployment security, housing benefits, financial aid for students and state-guaranteed pensions. NHI funding is divided into two pools: Medical Sickness Insurance and Income Insurance (see Figure 1). The Medical Sickness Insurance is funded equally by the insured (via fees collected through taxation) and the state. The Income Insurance is funded by the insured (also via fees collected through taxation) and employers. The contributions by insured individuals and employers are income-based, calculated as a fixed proportion of employee wages. Occupational health care, and sickness and maternity leave allowances are covered by the income insurance pool; the medical sickness insurance pool covers the remaining services. The NHI system offers varying levels of reimbursement for outpatient drugs, care from private providers, transport costs to health care facilities, sickness and maternity leave allowances, and some rehabilitation services. The NHI also partially reimburses occupational health care costs for services delivered to employees, but not to dependents. The NHI offers a more explicit scope of coverage than the municipal system, especially in terms of outpatient drugs. The NHI assigns each drug to one of three categories, each of which is associated with a different reimbursement level (42%, 72% and 100%; see Section 5 for additional information). The NHI reimburses around 30% of the cost of any private health care services deemed by a physician to be necessary for the diagnosis or treatment of a disease, pregnancy or childbirth without payment ceilings or limitations. The NHI does not cover private health services that are considered unnecessary to treat a disease (e.g. cosmetic surgery). However, the legislation only vaguely defines the line between conditions considered diseases and those that are not.

Private insurance Voluntary (private) sickness insurance is uncommon in Finland. In 2005, 375,000 children (about one third of all children) and 237,000 adults (about 5% of the population) had voluntary health insurance. Private sickness insurance is usually unavailable to elderly people. The relatively high number of private policies purchased for children is partly explained by the fact that children

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do not have access to the occupational health care services commonly used by employed people as an alternative to the municipal system. The scope of voluntary insurance coverage (both sickness insurance and accident insurance) is usually limited, and great variation exists across different schemes. Private insurance might cover the costs of treatment and other compensation due to permanent disabilities, loss of income, or death. Public regulation of voluntary insurance is limited, and insurance companies can design their schemes freely. Most individuals who purchase voluntary health insurance do so to limit their out-of-pocket payments for private care and the portion of outpatient drug charges not covered by the NHI. Additional reasons include shorter waiting times, the ability to choose a physician, direct access to a specialist, and the perception of better quality services. Patients do not need referrals to private hospitals if they intend to pay for their care with partial reimbursement from the NHI. Private providers can also offer patients shortcuts to municipality-run hospitals, as private providers may be more willing to refer patients for specialty care. In contrast, public health centres may be more conservative about referrals because they are run by the municipalities that also pay for specialty care delivered by public hospitals.

Occupational health care system The Occupational Health Care Act of 1979 obliges employers to provide occupational health care services for their employees (see Section 5 on Employers). The Act defines compulsory occupational health care as health services necessary to address work-related health risks. Services must include physical examinations and first aid for employees at the workplace, and employers are obliged to check the health status of all employees whose work might endanger their health. Most large or medium-sized employers also provide curative outpatient services through their occupational health care programmes; about 13% of all outpatient physician visits in Finland are provided by the occupational health care system. In 2004, approximately 90% of employees with access to compulsory occupational health care services also received some curative services from their employers. Significant differences exist in the scope of curative service coverage across employers. Notably, despite a separate funding mechanism and distinct legislative framework, occupational health care services most often fall functionally within the scope of primary health care.

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Assessment The backbone of Finnish health care is the municipal system, since it provides truly universal access to a wide array of health services. The ultimate responsibility for the costs involved in a patient’s health care is borne by the municipality of residence. This structure favours prevention, since it is in each municipality’s interest to avoid the high long-term costs of poor health by investing in the avoidance of disease. As a result, efficient structures for delivering such services exist throughout the country. Finland’s infant mortality is among the lowest in the world, with only 2–7 deaths annually since 2000. (Statistics Finland 2006) Finland was also the first country to eradicate measles through a comprehensive vaccination programme. As geography determines each municipality’s pool of beneficiaries, there is no means of excluding high-risk or high-cost beneficiaries. A needs-based system of allocating state subsidies to municipalities (described later), together with a risk pooling system for high-cost treatments between municipalities belonging to the same hospital district, prevents individual municipalities from assuming excessive burdens of health care costs for high-cost individuals. However, many experts are concerned about potential cost shifting trends, particularly due to incentives introduced by parallel funding mechanisms for public and private care (discussed in greater depth later in this Section). Some health centres are struggling to provide timely services, particularly for preventive care, because rising specialty care costs are driving some municipalities to increase hospital funding relative to the funding of health centres. From a value-based perspective, however, resources should be directed to areas with the greatest potential to improve outcomes (and value), irrespective of patients’ ability to pay. In response, the current government has cited strengthening primary care among its principal health policy goals. In addition, municipalities must pay for public hospital care for patients referred by private or occupational providers. As a result, municipal gatekeeper policies requiring patients to obtain primary care referrals before seeking non-emergency hospital care cannot be universally enforced. From the legislative and organizational perspectives, the Finnish system does a good job of guaranteeing universal access to care. Evaluated from the perspective of actual use of services, however, a somewhat different picture emerges, with significant variations in the use of services persisting across both geography and socioeconomic status (i.e., income, education or profession). Several factors may explain the geographic differences in access to health services. A national shortage of physicians (more severe in rural municipalities) and differential access to private and occupational health care services (more common in cities) are among the factors contributing to unequal access in various parts of the country.

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The 2005 introduction of maximum wait times for municipal care has improved timely access, especially for hospital-based services. However, some health centres and hospital districts still fail to comply with the guarantee. Legislation has also not yet defined maximum wait times for health centre physician appointments for non-acute care amid deteriorating access to these services. In April 2008, 37% of Finns lived in municipalities with waits of more than two weeks for non-acute physician appointments, up from 25% in September 2005. Differences across socioeconomic groups in mortality amenable to health care are wide and seem to be expanding. (Arffman et al. 2007) In 2000, the extent of income-based inequity in access to physician visits in Finland was among the highest of any OECD country, along with the United States and Portugal. (Van Doorslaer et al. 2006) There are also significant income-based differences in screening, dental care, coronary revascularizations and some elective surgeries. (Teperi et al. 2006) Among the most important reasons for socioeconomic differences in access to services is the expedited access to care offered by private and occupational health care providers in relation to municipal care. Private and occupational services are more commonly used by wealthy people and this contributes to differential access according to socioeconomic status. (Häkkinen 2005) To some extent, social inequalities may also arise from the fact that occupational health care is offered free of charge, whereas the patients of municipal health care have to pay modest user-fees. The municipal system also limits competition for patients. In a valuebased system, both the payers (i.e. “health plans”) and providers of care compete on value or to deliver better health outcomes per euro spent. In Finland’s public system, municipal “health plans” do not compete for members since individuals do not choose their municipalities of residence based on factors related to health care. Competition is also limited on the provider side. In theory, municipal providers could compete with private providers on the basis of value. However, in practice, municipal providers have not competed meaningfully with the private system, which does not provide a full spectrum of services. (Competition between providers is discussed in detail in the next Section.) Instead, cost shifting takes place both within the public system and between public and private organizations. Within the public system, cost shifting between municipalities and the NHI leads to perverse incentives vis-à-vis value creation. Since municipalities pay for most care but the NHI compensates residents for lost wages, hospitals have little financial incentive to treat patients quickly. During the years, this has led hospitals to use lengthy queues to balance the demand and supply of services. Municipalities pay for medications delivered in hospitals, but the NHI pays for drugs taken at home. Hospitals

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therefore have incentives to prescribe outpatient medications in lieu of inpatient drugs or treatment. For long-term care, municipalities are responsible for outpatient drug costs in residential homes rather than the NHI. For this reason, a vast number of residential homes have been administratively changed to “sheltered living units”, ofﬁcially deﬁned as independent housing, rather than long-term care facilities. In this way, municipalities are able to shift drug costs to the NHI.

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Structure of health care delivery

Providers Finland has two parallel systems for providing health services: the municipal health care system and the private health care system. Although occupational health care services are delivered by private and municipal providers, it is generally viewed as a third care delivery channel with its own funding mechanism and governed by separate legislation. The parallel systems are not mutually exclusive, but rather they can complement – or at times overlap – each other. An employed individual can choose to see a primary care physician at a municipal health centre, a private occupational health unit and at a private non-occupational health facility during a single week. As such, the systems are not separate from a care cycle perspective, and municipal hospitals accept referrals from any licensed physicians, including those working in private practice. According to a population survey, about 45% of physician visits by employed individuals occurred in occupational health care settings, 35% in municipal health centres and 15% in private facilities. (Perkiö-Mäkelä et al. 2006) For unemployed people, however, the municipal health care system is in practice their only option. The parallel systems are not cleanly separated by care delivery settings. Some municipalities contract with private providers to deliver certain services, in which case the care is considered as delivered by the public system and patients are not required to pay private rates. This has become common practice for specialties such as orthopaedics and rheumatology, where two private foundation-based hospitals have created national centres of excellence that frequently contract with municipalities to care for public patients. There are no regulations limiting the geographic location of private services purchased

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by municipalities, which, at least in principle, is positive from a value-based perspective. In 2006, annual per capita health care spending by municipalities ranged from less than 1,100 euros to about 2,900 euros. Variations in total spending are due in part to each municipal population’s age structure and morbidity profile as well as to differences in access to and the use of services. However, differences in the structure and organization of care delivery have evolved over the decades, leading to varying degrees of technical efficiency and productivity that also impact spending levels. Indeed, studies have shown significant differences in case-mix adjusted costs between Finnish hospitals. This Section categorizes and analyzes providers according to functional headings. In this context, primary care includes a range of preventive services, curative care overseen by general practitioners, rehabilitation, outpatient mental health care and long-term care. In the Finnish system, primary health care units also have in-patient wards that mainly serve long-term patients because public hospitals and rehabilitation facilities normally offer only short-term inpatient care. Primary care also includes health promotion targeted at the local population, such as health education, environmental health, and the implementation of local policies conducive to public health. Specialized care refers to care provided by specialists and specialist-led teams. Besides hospital-based inpatient and outpatient services, some specialized care is delivered at private specialists’ offices or, more recently, in patients’ homes (“hospital-at-home”).

Primary health care The Primary Health Care Act obliges each municipality to have a “health centre” that organizes and delivers preventive public and primary health care services to its residents. Each health centre may be owned by a single municipality or jointly by a federation of several municipalities. Often, a health centre is not necessarily comprised of a single building or location where services are provided. For example, maternal and child health care or school health care might be provided at a location separate from the main health centre. In general, patients must use the health centre within their municipality and cannot choose their own providers (see more about patient choice in Section 3). Larger cities usually offer several health stations located in different areas. For example, the City of Helsinki has 29 health stations that collectively form the health centre. In sparsely populated areas such as Lapland, the distance to the nearest health centre facility is much greater than in the more densely populated south. Currently, only about one in four health centres serves a population base of 20,000 or more. In January 2007, Parliament introduced a law requiring

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municipal primary health care services to be delivered by centres covering at least 20,000 inhabitants by 2012, following a four-year transition period. The initiative aims at creating a stronger structural and financial basis for the delivery of health care services, which will lead to improved quality, effectiveness, availability and efficiency as well as to and technological advancement. Historically, all municipal primary care services were provided by municipally owned and run health centres. In 1993, municipalities were given the freedom to purchase services from private providers. In these cases, antitrust legislation requires contracting through open competitive tenders. Municipalities choosing to contract with private providers do so primarily due to difficulties in recruiting physicians and other health care personnel. A few midsize cities have contracted with private providers to deliver all services at certain health stations, while others have contracted only for specific services such as emergency care. Today, municipalities purchase a small proportion of municipal primary care from private providers, although the proportion is expected to increase. Some municipalities, including the cities of Tampere, Oulu and Raisio, have introduced internal purchaser-provider splits into their management structures. In these cases, purchaser and care delivery functions are separated within the municipal administration, making it easier for municipalities to contract with private providers and to objectively compare services across sectors. Health centres offer a wide variety of services, including preventive, maternity and child health services, general outpatient care, care on inpatient wards (in larger cities, these are often classified as GP-run hospitals), dental care, school health care, occupational health care, care of the elderly, family planning, physiotherapy, laboratory services, imaging, and some ambulatory emergency services. Many health centres also provide ambulatory psychiatric care. It is estimated that only about 5% of health centre visits lead to specialty care referrals (Puhakka et al. 2006), indicating that the wide scope of expertise in health centres can cope with most health needs. Tasks are often divided among health centre clinicians according to the needs and circumstances of the individual centre and the experience or interest of its staff. Teamwork between doctors, nurses and other professionals has increased in recent decades, which has led to a high degree of “horizontal integration” or care coordination within the health centre. For example, some health centres have assembled multi-professional rehabilitation teams and diabetes teams dedicated primarily or exclusively to care for particular types of medical conditions. Some health centres have also arranged for specialists to perform regular on-site consultations, such as for a radiologist from the local hospital to interpret patients’ x-rays at the centre. Legislation does not stipulate in detail how most health centre services should be provided, leaving this to the municipalities’ discretion. However, the

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national administration (primarily the Ministry of Social Affairs and Health) has devised guidelines in certain areas, including maternity and child welfare clinics, school health care, and screening. Most health centres staff a wide range of clinicians, including general practitioners, physicians from other clinical specialties, nurses, public health nurses, midwives, social workers, dentists, physiotherapists, psychologists and administrative personnel. Health centre staff are generally employed by the municipality, although municipalities may also hire some physicians from private organizations (see Section 3). The ratio of health centre physicians to local residents varies, averaging at about one physician per 1,500–2,000 inhabitants. A typical health centre’s GP-run inpatient department has between 30 and 60 beds. The vast majority of inpatient care delivered by health centres is actually long-term care for chronically ill elderly individuals (the average age of these patients is 75 years), with 54% of inpatient days involving patients residing in the unit for more than 6 months. In practice, health centre inpatient wards function similarly to residential homes. Municipal health centres play a central role in disease prevention and health promotion, including maternal, child health and school health care. Besides school-based health care, children and young adults are eligible for extensive preventive dental care. Municipalities are also responsible for providing immunizations and breast cancer and cervical cancer screenings. These services are free of charge and available for all residents. Concerns have been raised about the quality of primary care and disease management for major chronic conditions like diabetes or atherosclerosis. One major barrier to improvement in these areas has been a lack of information on the quality of primary and chronic care, and some quality improvement programmes are now targeting primary and chronic care delivery. Perhaps the most well known is the Development Programme for the Prevention and Care of Diabetes (DEHKO), which is coordinated by the Finnish Diabetes Association (NGO). The programme aims to prevent type 2 diabetes and diabetes-related complications by improving the quality of diabetes care and supporting people with diabetes in their own disease management and selfcare efforts. The programme constructs new clinical practices that have been implemented in health centres and hospital districts throughout Finland. It focuses on screening people at high risk of diabetes, managing risk factors through lifestyle counselling and preventing complications among newly diagnosed people with type 2 diabetes by bringing them within the sphere of appropriate treatment. The current government has made a ﬁrm commitment to revitalize Finnish primary health care. The Minister has overseen the launch of a major initiative known as the “Effective Health Centre.” This action plan includes a

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number of elements aimed at improving access to care and practices within health centres, as well as administrative, managerial and structural arrangements. Patients are also free to use private general practitioner services, and the NHI reimburses patients for part of the cost of private care (on average 30%). Physicians do not have to enter into individual agreements with the NHI in order for their patients to receive NHI reimbursement; any patient treated by a private licensed medical doctor will be partly reimbursed by the NHI. Private providers are free to set their own fees as they see ﬁt. Ambulatory physician services are the most commonly sought type of private care, with visits to private physicians comprising 16% of all outpatient appointments; for specialist appointments, the proportion is about 25–30%. In 2006, there were 3.5 million outpatient visits to private doctors (compensated by the NHI), of which 79% were visits to specialists. (SII 2007b) The specialties with the highest proportions of private health services were gynaecology and ophthalmology, which comprised more than one-third of private specialty visits. In addition, the private system provides about 41% of outpatient visits to dentists. Private outpatient services are provided through three organizational models: physicians’ private practices housed in their own facilities (currently rare), physicians’ private practices located in shared facilities owned by private companies and physicians directly employed by private ﬁrms (a new trend). Currently, two large national companies (Mehiläinen and Terveystalo) operate multiple inpatient and outpatient units throughout Finland. These units serve private patients and contract with employers to deliver occupational health care services. Private GP services are mainly provided in the large cities. Ten percent of physicians work full-time as private doctors, and 30% are employed by the public sector but also have private practices outside their regular working hours. Provision of occupational health care is described in Section 3.

Specialized health care Most hospital care in the municipal system is provided by the country’s 20 municipality-owned district hospitals. In addition, some large municipalities (such as Helsinki) provide some specialist level outpatient and inpatient services themselves rather than purchasing them from their hospital districts. Finns very rarely visit foreign providers due to geographical and language barriers. Each municipality must belong to one hospital district. The largest hospital district covers over 1.4 million inhabitants, while the smallest covers only 65,000 people (2008). Of the 20 districts, 12 serve populations of less than 200,000. The number of member municipalities within a hospital district

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ranges from 6 to 58. Each hospital district has one central hospital and other hospitals as necessary, depending on the size of the district. Five of the central hospitals are university teaching hospitals. Physicians and other personnel in public hospitals are salaried employees of the hospital district. Hospital districts are funded by the member municipalities mainly on a fee-for-service basis (see the Section on reimbursement). Hospital districts generally aim to provide a complete set of services, as illustrated by the list of providers offering selected services along with their patient volumes as presented in Table 2. Many services are completely decentralized; for example, every Finnish hospital district has a high tech cardiology centre. In the event of some common but costly procedures requiring specialized teams, some hospital districts have limited the number of providers within their borders who deliver that form of care. Examples include joint prosthesis surgery and childbirth. It has been especially challenging for smaller districts to secure both economic efﬁciency and the dedicated teams needed to provide high quality services.

Table 2: Number of selected procedures per hospital in 2006 (Finnish municipal health care system) number of procedures

Operation Operation on the meniscus of knee Primary prosthetic replacement of hip joint Total excision of uterus Partial excision of prostate Implantation or replacement of permanent transvenous cardiac pacemaker Mastectomy Fracture surgery of wrist and hand Thyroid gland operation

Source: Hospital discharge register, THL

range

average procedures

hospitals having <50 proced./year

12–680

185

12%

49 45 39

4–945 5–971 1–281

191 134 91

18% 27% 28%

1–668

110

42%

1–364

56%

46 40

2–465 1–184

59 45

67% 67%

number of hospitals

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By government decree, hospital districts are grouped into five tertiary care regions organized around the five university teaching hospitals. The main function of these regions is to centralize care delivery for some complex or rare conditions, surgeries and other forms of treatment at the tertiary care region level. The hospital districts within the tertiary care region determine which procedures should be regionally centralized. Care is further centralized at the national level for around 20 conditions or treatments, in that only one or two tertiary care regions serve those patients. The Ministry for Social Affairs and Health determines the types of care to be centralized nationally and the hospitals that will deliver the care. This is the case, for example, for organ transplants (performed by one hospital) and care for life-threatening burn injuries (delivered by two hospitals). Efforts to centralize the delivery of certain types of care in particular hospitals and hospital districts are formalized through contracts that do not involve any formal competitive proposals or other processes. Hospital districts provide specialized outpatient care, inpatient care and day surgery, usually in the same facilities. Hospital districts have created regional guidelines for the care required over the entire course of some common diseases. These guidelines set out the division of labour between health centres and hospitals across care cycles. Patient information is transferred from health centres to hospital districts by written referrals. Hospitals communicate information back to health centres via an “epicrisis” (a patient record summary for the episode of care) sent electronically in some hospital districts. Patients need referrals from their health centre physicians, or any other licensed physicians in private or occupational health organizations, in order to access non-emergency outpatient or inpatient hospital care. Day surgery, or invasive procedures that do not require overnight hospital stays, has become increasingly common in Finland. The number of day surgery operations has risen from 77,000 in 1997 to 171,000 in 2006, when day surgery represented about 40% of all surgical procedures (versus 19% in 1997). Private hospitals provide about 5% of hospital care in Finland. There are about 40 private hospitals, most of which are small. The largest private hospitals provide orthopaedic and related services throughout the country, with most care procured by the municipalities. Two of the large hospitals are notfor-profit foundations (Orton, Reumasäätiö) and one is a public company (Coxa, Hospital for Joint Replacement). The role of the private sector is much more prominent in specialized outpatient care. About 25–30% of specialized outpatient visits are conducted by private sector organizations. One advantage of private providers is their ability to expand geographically, unlike the municipal sector. Some municipalities and hospital districts purchase certain specialty services (such as surgical operations) from private hospitals; however, this is not

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very common. When municipalities and hospital districts do purchase services from private providers, contracts and payment mechanisms vary considerably. Due to antitrust legislation, these contracts must be arranged through open competition. One of the trends in specialized health care has been to establish condition-speciﬁc care units, a movement driven largely by hospital districts. Instead of the traditional divisions organized by individual specialties, these units are organized around medical conditions, groups of conditions or types of care, and they bring together a wider combination of competencies. For example, providers within a hospital district may offer cardiac care units, musculoskeletal disease units, gastroenterological units and stroke units. The idea is to bring experts from various specialties to work together in a single unit containing all of the personnel and equipment needed to treat what are often complex cases. Within these units, nursing personnel can specialize in caring for a speciﬁc group of patients, which can lead to a more active role for nurses in the care delivery process. The ultimate aim is to create multidisciplinary and multi-professional teams capable of re-engineering care processes to produce superior value. Typically, these units are located within hospitals, with each unit forming an administrative division. The head of the unit generally does not report to a traditional specialty-based division but rather to the director of a broader department.

Health professionals In 2005, physician density in Finland was 2.4 practicing physicians per 1,000 population (Table 1), slightly below the EU15 average. In 2006, 47% of physicians worked in hospitals, 23% in health centres, 5% in occupational health care, 6% in academic medicine and 11% in full-time private practice. (Suomen Lääkäriliitto 2006) The majority of physicians are full-time employees of the municipal health care system. Only 1,700 out of approximately 16,000 physicians of working age are employed full-time in private practice. However, 30% of physicians employed in the public sector operate private practices outside their regular working hours for an average of four hours per week. (Suomen Lääkäriliitto 2006) Medicine is a rather prestigious profession in Finland. The salaries of physicians employed by a municipality are relatively high when compared with many other public sector professions, but they are not as high as private sector salaries. In 2005, Finland had 12 registered nurses of working age per 1,000 inhabitants. According to the European Health for All Database, the number of Finnish nurses is on par with the EU average. More than half of Finland’s den-

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tists, dental hygienists and dental assistants work in the private sector because the majority of dental services are delivered by private providers. Physicians are trained at five public universities in Finland, where education is free of charge. Admission is based on high school grades and entrance exams. Basic medical education lasts six years and includes a considerable amount of guided practical training. After university medical studies, physicians must complete two years of practical work and training in both hospitals and health centres before they are granted their licenses to practice medicine independently. After graduation, continuous medical education is provided by employers of health professionals, medical societies, universities and pharmaceutical companies. Dentists are trained in three university medical faculties, and their studies last five years. To become specialists, physicians and dentists must register with a faculty of medicine for their relevant specialty training programme. To obtain specialist diplomas, physicians must complete specified theoretical studies and pass a national examination in addition to fulfilling clinical requirements. Specialization lasts five to six years after basic medical training, depending on the specialty. In 2006, about 63% of physicians of working-age had specialist training (the majority of the remainder worked as general practitioners) and 22% had PhDs. (Suomen Lääkäriliitto 2006) The training of nurses and other health care personnel such as physiotherapists, midwives, and laboratory personnel takes place at universities of applied sciences (former polytechnics). Nursing students have common training in general nursing, which is complemented by training in a specialty of their choice: 1) nursing for surgery and internal medicine, 2) paediatric nursing, 3) aesthetic and operating theatre nursing or 4) psychiatric nursing. The training programme for public health nurses lasts three and a half years and four and a half years for midwives. The division of labour between physicians and nurses is rather rigid in Finland. Physicians have sole responsibility for making diagnoses and determining treatments. The role of nurses is primarily to assist physicians with these activities. Recent years have seen discussions about increasing the roles and responsibilities of nurses, for example to provide nurses with limited prescription authority, but few such reforms have been implemented to date. In several cases, physicians have opposed expanding other professionals’ rights and duties.

Health professionals in the municipal health care system General practitioners are normally municipal employees. The compensation system for general practitioners working in municipal health centres varies across municipalities. The traditional payment method, which currently ap-

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plies to about half of health centre physicians, is a monthly salary supplemented by fee-for-service payments for performing certain time-consuming services or minor procedures (e.g. placement of intrauterine contraceptive device, measurement of intraocular pressure and sinus puncture). Some municipalities allow patients to choose their primary care physicians. Others have a “personal doctor system” that assigns each patient to a particular general practitioner, usually based on place of residence. The system was introduced in the 1980s and 1990s to improve access and continuity of care because physicians do not change between visits. Currently, approximately half of the physicians working in health centres participate in the personal doctor system. These doctors receive a combination of basic salary and capitation and fee-for-service payments. Although physicians in this scheme are municipal employees, they enjoy relative autonomy and can set their own working hours. In some municipalities, health centre GPs have specialized in treating specific patient groups (e.g. people with diabetes). However, specialization is difficult to implement in a personal doctor system that is based on geographical division, and it has been one of the arguments against the personal doctor model. Municipalities currently face considerable difficulties recruiting clinical staff, including physicians, dentists and nurses, especially in rural areas. In October 2006, 9% of health centre physician posts were not filled. In the Kainuu region in northeastern Finland, this figure was 26%. (Parmanne et al. 2006) The shortage is even more significant among dentists, with about 12% of health centre dentist posts vacant in 2007. Importing foreign physicians is often proposed as a longer-term way to address the shortage. However, language barriers, the ethical dilemma of depriving other nations of their badly needed health professionals and the somewhat negative attitude of trade unions are among the factors working against this option. According to a 2007 estimate by the Finnish Medical Association, 360 of about 17,000 physicians licensed in Finland were non-Finnish nationals. The largest groups of foreign physicians were from Estonia and Russia. Despite a significant rise in the number of Finnish nurses and auxiliary nurses since 1990, health care providers are now finding it increasingly difficult to recruit enough nurses. A relatively large proportion of Finnish nurses are working in fields other than health care or abroad, which indicates the relative unattractiveness of the nursing profession in Finland. The shortage of physicians stems from the early 1990s, when Finland was in the midst of an economic recession. Until that time, unemployment among physicians, dentists and nurses was practically nonexistent but the reductions in health care budgets led to significant staffing cuts. Medical schools also reduced their annual class sizes in the early 1990s, which forecast a decreasing

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need for physicians. As the public sector gradually recovered from the economic crisis in the late 1990s, a significant physician and dentist shortage developed. In response, the annual intake of medical students has increased gradually since 1995. However, it will take many years before the increase has a significant impact on the shortage. Municipal health centres are unable to wait for new physicians to rise through the system, and they have begun to lease physicians employed by private companies. The practice is particularly common for physician shifts outside normal business hours, although municipalities have recently also entered into long-term contracts for staffing during regular office hours. Private physicians negotiate their salaries with the firms that employ them. While the conditions of employment for municipal health centre physicians are largely determined at the national level by the Finnish Medical Association and the Association of Finnish Local and Regional Authorities, private firms are free to offer higher compensation and more flexible working conditions. In 2004, about 5% of Finnish physicians worked for private firms, especially young physicians interested in more flexible contracts. The private system also allows physicians to partly avoid income tax (which is rather high in Finland) and receive part of their salaries as capital income. The shortage of professionals may turn out to be a critical factor in the development of Finnish health care. Due to its older population structure, Finland is about to enter an era of a declining labour force that will lead to a general increase in competition for workers. As the resources dedicated to Finnish health care expanded in the 1970s and 1980s and were cut back in the 1990s, the age structure of clinicians is skewed, particularly for nurses; about 40% of active health professionals are over 50 years of age. There is a great need for a clear national health care human resource strategy.

Long-term care Long-term care for older people is provided in four different settings: home care (including care delivered at patient homes or at day-care centres); sheltered housing (apartment complexes for the elderly offering onsite services such as meals, nursing care, and assistance with activities of daily living); residential homes (institutions for elderly people requiring more demanding services, and in which residents do not have their own apartments); and health centre inpatient wards. In 2005, 12% of over 75-year-olds used regular home care services, 6% lived in sheltered housing (of which a little more than half had 24-hour assistance), 4% lived in residential homes, and 2% received longstay care in health centre inpatient wards. (Stakes 2007) Long-term inpatient care at health centres has decreased somewhat since 1990.

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Inpatient wards are part of the municipal health care system, while most other forms of elderly care are organized under the umbrella of municipal social services. The majority of residential homes and about half of sheltered housing for older people are owned by municipalities and run by the social welfare service sector. There are also a number of private companies and NGOs providing these services; in 2006, 12% of residential home services and 57% of sheltered housing services were delivered by private organizations. Health centres also work closely with municipal residential homes; most health centre physicians usually deliver care to public residential home patients once or twice a week. Various documents concerning health and social policy have stressed the need to improve support services in order to enable older people and people with disabilities to live in their own homes. The number of traditional residential homes has decreased since the early 1990s, and the volume of sheltered housing has increased. The shift has been prompted by public sector support for independent living as well as by municipalities’ financial incentives. For patients in sheltered housing, access to national social insurance benefits are similar to those available to home care patients. Drug costs, for example, are covered by the NHI, and not by municipalities. In contrast, residential homes are classified as institutional care settings, which places financial responsibility for drugs and other services solely on the municipalities.

Recent reforms to overcome service delivery fragmentation The municipal health care system is decentralized, with organizational responsibility divided among approximately 350 municipalities and 20 hospital districts. Decentralization has been valuable in terms of ensuring the accountability of municipal health systems to local citizens. Recently, however, several trends have made small municipal health systems increasingly vulnerable. Population movement from rural municipalities to cities, particularly among citizens of working age, has led rural populations to age at an even faster rate than in urban areas. The rising demand for health services is even greater among the elderly population, and is exacerbated by a limited pool of health professionals, tight public-sector ﬁnances, and an increasing demand for expensive new equipment and technology. In recent years, concerns have grown that the problems of decentralization outweigh the advantages. One of the most commonly discussed changes to the public sector health care system has been the creation of larger geographic units to take responsibility for the organization of health services (i.e. The Project to Restructure Municipalities and Services). The number of municipalities has already decreased from 452 in 2000 to 348 in 2009. Many

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believe that the appropriate number of municipalities is still much lower, and that regional co-operation should be stronger than at present. Municipalities are not eager to merge, and the mergers achieved have been partly motivated by extra state subsidies. It is generally believed that co-operation between primary and secondary care has been limited by the existence of multiple, separate organizations responsible for organizing care. To improve cooperation between primary and secondary care, as well as social welfare services, several local reforms have been enacted. For example, several member municipalities of the Päijät-Häme and the Itä-Savo hospital districts are purchasing primary care services from their hospital districts rather than offering primary care through their own health centres. (Vuorenkoski & Wiili-Peltola 2007) To lower the barriers between primary and specialist health care and improve cooperation across provider types, the government plans to combine the Primary Health Care Act and the Act on Specialized Medical Care into a comprehensive Health Care Act (see p. 60). It is now believed that too much separation between organizational structures for primary and secondary care has negatively inﬂuenced the cooperation and integration between these levels of care. Such separation can hinder the optimal organization of care from both clinical and economic perspectives. For example, transmitting patient records and other information between primary and secondary care providers is currently difﬁcult. In addition, primary care centres are often disadvantaged in terms of resource allocation. Since hospital districts are governed by several municipalities and they charge each municipality for care on a fee-for-service basis, municipalities have less control over hospital expenditure than they do over spending by their own health centres. These reforms are controversial because they diminish the power of individual municipalities. Some experts fear that closer cooperation between primary and secondary care may shift the balance of power towards secondary services, as hospital districts will become even stronger with respect to municipalities.

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New Health Care Act The current government is planning to merge the Primary Health Care Act and the Act on Specialized Medical Care into a comprehensive Health Care Act. The central aim of the reform is to reinforce the role of primary health care in the municipal health care system. The government set up a working group in 2007 to draft a proposal for the new Act. The proposal was finalized and released by the working group in June 2008. After thorough process to hear the opinions from relevant stakeholders, the government is planning to pass the bill to Parliament in 2010. The key proposals of the reform are to n increase patient choice by enabling patients to freely use the services of any health centre within the same hospital district and by enabling patients together with the referring physician to choose any hospital within the same tertiary care region; n lower the barriers between primary and specialized health care and improve cooperation. For example, one proposed model to achieve this is to combine the organizational responsibility for primary and specialized care into the same organization (currently primary health care is organized by the municipalities and specialized care by hospital districts); n improve the mobility of patient records within hospital districts by allowing the transfer of records between hospitals and primary health care units within a hospital district without the consent of the patient (currently explicit consent is needed); n centralize the organizational responsibility of ambulance and emergency on-scene services in hospital districts (currently municipalities); n strengthen the role of tertiary care regions by giving them more responsibilities to coordinate activities in the region (for example the coordination of continuous medical education and the uptake of new medical methods, and the consolidation of service production between hospital districts).

Innovations in care delivery In any organization, innovation is an important means of improving value for clients. This is particularly true in health care, where much progress has occurred in various ďŹ elds of clinical research and medical technology. However, innovations dealing with the organization of care delivery also have great potential to drive improvement in value.

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Service delivery innovations have been recognized among the key performance drivers of the Finnish health care system, and the government is currently funding municipal projects with these types of innovations in mind. Municipalities can receive government subsidies to develop services, improve efﬁciency and update care delivery methods. About 50 million euros annually were appropriated for about 1,100 local development projects from 2003 to 2007. The state provides partial funding, while the rest is covered by the actor responsible for the project. Projects are usually implemented by one or more individual municipalities but they can also be undertaken by a federation of municipalities or hospital district. Future funding by the Ministry of Social Affairs and Health (MSAH) for local development projects (about 25 million euros annually in 2008–2011) will be designated toward activities related to the implementation of the National Development Programme for Social Welfare and Health Care (the “KASTE” programme) drawn up for the term of each government (normally four years). The programme is a cooperation agreement between municipalities and the state. Other national funding bodies for health care service innovations include the National Technology Agency of Finland (Tekes), the Slot Machine Association (which has a monopoly on gambling in Finland and is governed by the state) and Sitra, the Finnish Innovation Fund. These organizations’ total funding for health care innovation projects well exceeds that of MSAH. Since there is no administrative linkage between MSAH and many of the funding bodies, the coordination of funds coming from several independent organizations has been rather weak.

Reimbursement More than half of total Finnish health expenditure occurs via the municipal health care system. Functionally, this equates to 70% of all outpatient physician visits, 60% of dentist visits and 95% of inpatient care. The main funding sources are municipal taxation, state subsidies and user fees. The state subsidizes roughly one quarter of municipal expenses, with subsidies varying across municipalities from zero to 2,500 euros per resident. State subsidies for municipal social and health care services are calculated according to factors including the number of inhabitants, age structure, unemployment rate, remoteness and morbidity in the municipality. Subsidy amounts are also determined in part by a municipality’s ability to collect tax revenue. In practice, this means that municipalities with higher average incomes receive smaller subsidies. User fees cover 7% of the costs of municipal health care. Municipalities spent about 1,300 euros per inhabitant on health care in 2005, representing about 25% of municipal budgets. However, the distribution

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of expenditure levels across municipalities is wide. Part of the variation is due to structural differences as in municipal methods of dividing elderly care services across health and social services. However, even after eliminating this effect by combining spending on institutional elderly care and health care, expenditure varied from 940 to 2,310 euros per inhabitant in 2004. After adjusting this expenditure for need, expenditure was still 2.5 times higher in the highest-cost municipality than it was the lowest-cost municipality. (Hujanen et al. 2006) In primary care, municipalities prospectively fund health centre budgets, which are normally based on previous allocations. In federation-owned health centres, the budgets are constructed in similar ways, but the distribution of costs across municipalities is usually determined by the volume of actual services delivered to the residents of each municipality. Hospital districts are free to determine how they collect funds from municipalities. Municipalities are invoiced prospectively based on annual contracts for an estimated volume of services. However, the contracts are not binding, and the actual volumes often significantly differ from those stated in the contracts. Finances are balanced retrospectively according to actual services delivered to the residents of each municipality. Reconciliation of reimbursement from individual municipalities occurs independently of whether the referring physicians work in the municipal, private or occupational care sectors. Since private, occupational and municipal physicians can all refer patients for public municipal care, the ability of a single municipality to control or even predict the costs of secondary care is limited. Every hospital district has developed a special funding pool between member municipalities to cover exceptionally high individual patient expenses, typically above 50,000 euros per admission or care episode. Hospital district invoicing and pricing are in a continuous process of change, varying from district to district. (Häkkinen 2005) Apart from some special arrangements (e.g. to maintain readiness for events such as large scale traffic accidents or natural disasters), payments of municipalities are mainly based on district-specific price lists organized by individual service items (there are no national price lists) or packages of services such as diagnosis related groups (DRGs). At present, it is difficult to compare services and prices between hospitals and hospital districts. The NordDRG system was developed collaboratively by the Nordic countries to promote standardization and information sharing. With the NordDRG system, each patient is assigned to one of about 500 diagnosis groups. DRGs are designed such that care for all patients within each group is expected to require similar resources. DRG groups are defined by one or more factors such as diagnosis, comorbidities and the particular procedures required. Prices assigned to each NordDRG group are based on actual historical costs. A 2003 survey found that while NordDRG use was increasing and eight Finnish hospital districts used NordDRG-

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based invoicing for somatic inpatient care and day surgery, most districts continued to use their own service grouping systems. (Punkari et al. 2003) Two features of current NordDRG use inhibit their ability to promote value-based care delivery. First, some NordDRG classiﬁcations are based on speciﬁc procedures rather than medical conditions. Second, NordDRGs typically cover care delivered during single hospital admissions and not during whole care cycles.

Private and occupational health care Private health care, excluding occupational services, accounts for 6% of total health care expenditure. Private services are mainly funded by out-of-pocket patient fees. Patients usually pay private treatment charges in full, but they may claim partial reimbursement from the NHI. As mentioned earlier, NHI reimbursement does not require any separate agreement between private physicians or providers and the NHI, and it is based on a government tariff system. These tariffs serve as guidelines because private providers are free to set their own prices in excess of tariff rates. Since tariffs have not increased at the same pace as the actual costs of delivering services, private provider charges are generally much higher than the tariffs. So while some private physician services may be reimbursed up to 75% of tariff rates (e.g. for examinations and certain treatments), the average NHI reimbursement remains around 30%. The occupational health care sector has a funding arrangement of its own, with both employees and employers each paying a percentage of employee salaries to an obligatory NHI Income Insurance pool (Figure 1). Onethird of the costs of the Income Insurance pool are covered by employees and the remainder is paid by employers. Overall, occupational health care accounts for 4% of total health expenditure. Although occupational health care has its own funding system, it is not functionally separate from the municipal or private health care systems. Occupational health services are provided by health care units owned by employers or they are purchased from private or municipal providers. When an employer contracts with a municipal health centre to provide occupational services for its workers, employees can choose whether to seek care from the health centre within the occupational system or as municipal residents within the public system. Employers fund occupational services according to their contracts with private providers or municipalities. Varying payment mechanisms are used, but all contracts require the employer to pay for services in full. Employers are then retroactively reimbursed in part by the NHI based on the employers’ actual costs. The NHI reimburses employers 50% of the necessary and appropriate costs of occupational health care up to a maximum of about 60 euros per employee per year for compulsory services and about 90 euros for voluntary services.

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Competition Traditionally, competition between providers has largely been absent from the municipal health care system. Public providers owned by municipalities and hospital districts provide the majority of services and since their catchment areas are based on geography, they do not meaningfully compete with each other for patients. Competition between municipal and private providers has also been minimal. However, municipalities are increasingly purchasing services from private providers via competitive bidding processes based on price and other considerations. Many private providers have been rather small, shortlived enterprises, thus making it difficult for municipalities to enter into longterm contracts with them. In other areas, particularly in rural regions, private services may not even exist. Competition between private and public service providers is also limited by differences in care delivery capacities between the public and private sectors. The private sector mainly concentrates on specific services, and it does not provide a full spectrum of care on a significant scale. Instead, most private services are marketed either directly to patients as ambulatory services complementing public care or to municipalities seeking to outsource some of their services. For individuals, private services offer direct access to a specialist of their choice. For municipalities, outsourcing has primarily been a way to increase capacity and to respond to clinician shortages. Since private firms can offer better financial and other incentives to clinicians than more rigid municipal systems can, competition for physicians between the public and private sectors has far exceeded the extent of competition for patients across public and private providers.

Assessment of the provider system As a whole, the long-term development of the Finnish health care system has been a success story. Since the 1960s, a system with fundamental problems has been transformed into one that is often cited as a model from which other countries might learn. Several indicators, including costs and population satisfaction, are competitive in terms of international comparisons. As a consequence of parallel reforms, structures within the Finnish health care system are complicated. Collecting and pooling the funds needed to deliver services, reimbursement and the actual provision of care involves working within partially intertwined structures. Not surprisingly, this leads to a situation in which incentive structures are not always aligned with improving patient health outcomes.

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Primary health care In recent decades, the Finnish health centre has been an internationally acknowledged model for primary care. At the core of the health centre concept is the wide variety of professionals working under one management structure in order to provide services close to the local communities. This means that prevention, curative services, rehabilitation and long-term care are provided by a single organization. As the Finnish population ages and the prevalence of chronic conditions rises, the health centre concept is more relevant than ever. However, health centres face challenges in the immediate future. Prevention – the cornerstone of primary care – is, according to most experts, struggling due to the pressures of increased spending on curative care. As suggested by outcome data on chronic disease management, service quality is often suboptimal. Municipal health centres will also continue to face harsh competition for professional staff. The Finnish government has identiﬁed strengthening primary care as a leading policy goal. It is clear that more effective tools are needed to support municipalities in providing primary services. Among other things, developing new models for integrating primary care with acute and specialty services and increasing the capacity to provide home-based services will require national investment. Recent initiatives in diabetes care may serve as a model that can be applied more generally to the care of other chronic conditions. If successful, the new Effective Health Care programme will be an important step toward securing the sustainable development of primary health care. One of the most important steps will be to ensure better measurement of value to promote and guide improvement in care delivery. Currently available data consists of aggregate patient volumes and total costs, far from the goal of universal measurement and reporting at the provider and medical condition levels. It is imperative to create and implement uniform measures for the content, costs and outcomes of primary care services at the medical condition level. Without measurement, no meaningful analysis of value creation in primary care, or interventions to improve it, is possible.

Specialized care In the municipal health care system, hospital-based inpatient and outpatient specialist services have traditionally been provided in the same facilities by the same physicians. Therefore, integration of care delivery is promising in this respect. However, the separation of primary and specialized care has persisted, creating a barrier to true integration encompassing full cycles of care. In this respect, much remains to be done. One meaningful policy step towards pro-

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moting integration is the New Health Care Act, which will combine the Primary Health Care Act and the Act on Specialized Medical Care. Another challenge is that all hospital districts, even the small ones, aim to provide a full spectrum of services. The resulting fragmentation in care delivery for any single medical condition prevents most providers from achieving the condition-specific patient volumes needed to create integrated practice units or centres of excellence. Policy documents and MSAH guidance have stressed the need to secure cost-effective, high quality services by limiting the number of providers delivering certain types of complex care. To date, however, the scope of these guidelines has been too narrow to spur widespread organizational change or improve the results of care. Better methods of service line rationalization across hospital districts, and in some cases nationwide, are needed to improve value. The new Health Care Act, if passed by Parliament, may provide better tools to improve the quality of care for less common conditions or complex, difficult treatments. The Act would strengthen the tertiary care regions charged with planning the division of labour between hospital districts to concentrate care delivery for each medical condition or service line within fewer providers. Decisions about the division of labour should be undertaken with a view toward improving the value of care for patients rather than as a top down consolidation process. Ultimately, the providers that offer a particular service line should be determined by their ability to deliver high-value care. Rigorous value measurement will be needed, with measures utilized by patients with the support and guidance of their referring physicians and other caregivers. Many public hospitals have already established several condition-specific multidisciplinary care units, thus laying a promising foundation for value improvement. However, these units have been pursued unevenly and without an overarching strategy. Although the number of private inpatient providers is small, some private hospitals have clearly been pathfinders in creating centres of excellence. These examples have served as models for public hospitals as well as other private providers such as ORTON and Coxa. ORTON Orthopaedic Hospital, based in Helsinki and founded in the 1940s, is owned by the ORTON Invalid Foundation, the leading Finnish organization of orthopaedic experts. The hospital offers several services: back surgery, endoprosthetic surgery, paediatric orthopaedics, hand surgery, knee surgery as well as sports medicine, rheumatic surgery and general orthopaedics. Coxa is a limited company founded in Tampere in 2002 to perform endoprosthetic procedures. The firm was founded by a few hospital districts, large municipalities, the ORTON Invalid Foundation and a German private hospital company. In 2006, Coxa performed about 10% of all prosthetic hip replacement procedures in the country.

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To produce maximum value for patients, care cycles should be smoothly organized by heavy investment in coordination between primary and specialized services. A key link between primary and secondary care is specialist ambulatory services. According to experts, one explanation for the poor coordination across provider types in Finland’s municipal system is that a substantial proportion of specialist consultations are provided by private practitioners. To avoid unnecessary hospital care, new ways to integrate specialist support with “front line” primary services are necessary.

Health professionals The number of outpatient physician contacts per person in Finland is lower than the EU average. In part, this may be due to different historical practices, such as the roles of nurses, midwives, and public health nurses. A well functioning training system has ensured the high competence of Finnish nurses, thus making it possible to delegate many important functions to nursing staff instead of to physicians. Traditionally, the role of public health nurses in preventive services has been decisive. Now, new ways are being tested to engage nurses in more independent roles for curative services. This should be seen as a means of improving value, since more expensive physician labour can be focused on the types of care that truly require medical training. Furthermore, studies show that in many cases, the value created by nurses can meet or exceed that of physicians (e.g. in inducing adherence to the treatment of chronic conditions). (Buchan and Calman 2005) Many experts regard human resource management as an underdeveloped function in Finnish health care. Most managers qualify for their position via achievements in their clinical careers rather than investing in management development. A value-oriented provider cannot afford the separate management systems hospitals currently maintain for medical and nursing personnel. These divisions create friction that works against the introduction of high-value care delivery processes and organizational structures. Improved leadership and management systems will be needed throughout the system if the goal is to pursue a path of value improvement despite an aging population and shrinking workforce. In the future, the diminishing pool of Finnish labour will further increase competition for health professionals such as physicians and nurses. It is unlikely that hiring foreign clinicians alone will solve the problem. Efforts should be made to improve the attractiveness of health care as a long-term working environment. Almost all hospital-based physicians are salaried hospital district employees, which minimizes the incentive toward over-treatment presented by many forms of productivity-based compensation methods. But with lengthy wait-

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ing lists in place throughout much of the country, incentives to see additional patients within the public system may currently be inadequate. Instead of seeing more health centre patients, many municipal physicians accept private patients in order to increase their income. In contrast, private practitioners earn their salaries based on the volume of services they provide. Fees are paid directly by patients, who are partially reimbursed by the NHI. Although the NHI has introduced some limitations to the care it will reimburse, it generally acts as a passive payer of practically all care delivered by private physicians, thus introducing the risk of over-treatment by private providers. The current fragmentation of care delivery across public and private providers also impedes the continuity of care and creates an inhospitable environment for the introduction of bundled pricing and other developments targeting full cycles of care.

Long-term care As the proportion of elderly citizens grows, long-term care is becoming a critically important part of health care delivery. Institutional care is provided through a wide variety of models. Such variety may be beneﬁcial to the extent that patients are able to select the kind of services they need and prefer. However, the current role of health centre inpatient wards in long-term care is unsustainable, with many individuals resorting to these wards when other forms of residential care prove unavailable. In some cases, the hospital-like setting of the wards may also limit the independent activity that helps elderly patients to maintain their functional capacity, thus worsening patient health whilst driving costs upwards. For years, increasing access to home-based care has been among the government’s major strategic health policy goals. Such care is believed to promote a better quality of life for patients and their families as well as cost savings by avoiding expensive hospital care. One of the key areas for future reform and policy development will be increasing collaboration between health care organizations and informal caregivers.

Recent reforms to overcome service delivery fragmentation The “health plan” function, that is enabling patient access to high-value preventive, curative and rehabilitative services, is the most demanding challenge in any health care system. The slow process of consolidation of small municipalities into larger regions is a positive development, but does not represent a decisive future course. Even larger municipalities may ﬁnd the challenge of managing complicated health care dynamics too demanding. Consideration must be given to the types of resources and support that municipalities will

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need to promote the reform of health care delivery within their borders over the coming decades. The burden of integration should not be placed upon service providers alone; they need the support and incentives created by competent and insightful payers. The link between primary care and specialized services is the subject of active debate in many developed countries, and is equally applicable to Finland. The new Health Care Act would offer provisions to enable the reorganization of care delivery, and it should be used to the maximum if passed. Areas with low population densities would also be able to provide both primary and specialized services through a uniﬁed health district (see the Box on the Health Care Act, p. 60).

Innovation in the delivery of care In any ﬁeld, innovation is the key to value improvement. Finnish policymakers are to be commended for understanding this and for creating a number of ambitious innovations in the health care sector. However, programme evaluations across a number of funders and implementing organizations have found that despite some very successful projects, the total impact of innovation funding has not met expectations. One challenge encountered repeatedly has been barriers to practical implementation of new care delivery models. Moreover, models created with external funding are not always viewed as permanent solutions. Obstacles to disseminating and adopting high-value delivery models created elsewhere in Finland or abroad seem to be even greater than the barriers facing local efforts. Among several reasons for suboptimal uptake is the small scale of many projects, which are frequently short-term process-focused initiatives evaluated according to productivity benchmarks. Initiatives are often implemented without strategic management guidance or oversight, and many provider organizations have weak expertise in change management. It is clear that the health care innovation funding described above has been too supply-driven; the state has offered funding to promising projects. The Finnish government is about to adopt a new national innovation strategy, including reviews of public policy and services. One of the strategy’s goals is to promote demand-driven innovation models. In a value-based health care system, providers are rewarded for creating more value than their competitors create. Therefore, they have strong incentives to identify and utilize innovations. In Finland, the positive pressure of competition is bounded by the vertical integration of funding (health plan) and service provision on the one hand and geographical virtual patient monopolies on the other. Controlled steps to loosen the monopolies, increase the diversity of service production, allow more patient choice and, above all,

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monitor the value created by each provider at the medical condition level will promote the adoption of innovations beneﬁting providers and patients.

Reimbursement In the current system, municipalities have less influence on the volume and costs of hospital-based care than they do on primary care because the municipalities themselves set the budgets for their health centres. As a result, municipalities may be forced to limit primary care services in order to cover the retroactive invoicing reconciliation for hospital-based care. This arrangement threatens primary health care and prevention, especially when municipalities are under the financial pressure they face today. Elements of managed care are substantially weaker in Finnish health care than, for example, in the US system. As mentioned earlier, very few modes of care are explicitly excluded from the set of services covered in Finland. The existing treatment guidelines are non-binding, and using care methods of suboptimal cost-effectiveness is not penalized. In both municipal and occupational health care, however, the Finnish payers have some functional means to promote patient access to high-value services. The situation is different for private services. The NHI reimburses all diagnostic procedures and treatments prescribed by any licensed physician. The NHI does not set budget or spending caps that would lead to rationing, and it funds services without assessing patient need or the efficiency of care. The only limitation is the patient’s ability to pay. In practice, private health care costs are limited by the fact that patients requiring costly services can obtain care from the municipal system. Technical aspects of reimbursement arrangements limit comparability of the services delivered, thereby limiting competition between providers. There are no national standards for defining the quality of services, making qualityand value-based comparison nearly impossible. The development of uniform service definitions and costing methods has been recognized as a key step to enable cost comparisons across specialized care, but no definitive policy decisions have been made. Similar standards are needed for primary and chronic care, and appropriate outcome-based quality gauges are required for all types of services.

Competition In a value-based health care system, health plans and providers both compete for patients on the basis of value, which is deﬁned as health outcomes achieved per euro spent. In Finnish health care, as mentioned previously, public sector health plans (municipalities) and providers are vertically integrated

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and they serve geographically defined guaranteed patient populations, creating monopolistic dynamics and limiting competition. It must be emphasized that the Finnish solution has important strengths. The geographical delineation of municipal responsibilities ensures health care coverage for everyone and access is generally high despite the waiting lists for some public services. Integrated payer-provider models, while admittedly limiting competition, avoid incentives to over-treat. The vertically integrated model can also make it easier to introduce care delivery and reimbursement reforms, although the opportunity to realize system-wide comprehensive, value-based reforms quickly has not yet been meaningfully pursued. The system of local primary care centres also provides a convenient mechanism for delivering and coordinating care in any municipality. Instead of radically changing the architecture of the system itself, steps could be taken to increase positive-sum competition based on value for patients within the current municipal model. Municipalities and federations should work with their own health centres, hospitals and long-term care facilities to organize care around medical conditions and to encourage providers to offer only those services in which they can deliver truly excellent care. In some cases, this may include combining what are currently considered primary and specialized services within a single organization. The public sector can also work with providers to implement systems of rigorous outcome and cost measurement in order to enable value assessment and improvement. Municipalities and federations can also encourage all of these changes among private providers by basing their private care contracts on results. In addition to influencing their own public and private providers, municipalities should develop care delivery networks beyond their own borders, especially for complex, specialized services. Based on reliable health and cost outcome data, municipalities should encourage patients to seek care from the best providers for their conditions, both within and outside their own hospital districts. An initial step might involve actively encouraging more value-based procurement and contracting, especially for complex, high-cost care. Once the added value becomes visible in the form of savings, these contracting practices could then be applied to a wider set of conditions. While municipalities might face initial resistance from local clinicians in some cases, municipalities as payers should also be motivated by financial incentives to guide residents toward high-value care. One challenge to value-based contracting is that municipalities may not currently have the purchasing skills needed to implement this type of contracting effectively. From a value-based perspective, new policies increasing the use of service vouchers are of interest. These policies aim to provide more choice to patients, thus simultaneously increasing value-based competition among providers. So far, the impact of the voucher system on service quality has not been docu-

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mented. This could be partly because demand for virtually all services is strong and patients have limited opportunities to choose among providers. The private health care system has also not acted as a competitor to municipal services but rather as a complementary system that serves as a “safety valve” for patients who wish – and can afford – to choose their physicians or obtain direct access to a specialist with no referrals or delays. Unlike many countries, Finnish physicians can simultaneously work for public providers and as private practitioners. From a municipality’s point of view, it is desirable for patients to receive care from private (or occupational) providers because some or all of the costs are paid through other channels. For patients, private care is much more expensive than municipal services, which limits the proportion of Finns who seek care from private providers. Public-private competition is also limited by the narrow spectrum of services provided by private health care organizations. Private providers increasingly complement municipal services by contracting with municipalities to deliver care. With a growing shortage of health professionals, the private sector has an advantage in its ability to offer more ﬂexible and attractive compensation schemes. Thus, there is competition to attract and retain clinicians, but not to attract patients on the basis of value. Although some individual businesses and entrepreneurs may beneﬁt, this type of competition creates potential problems for the system as a whole. Services are procured on short-term contracts for private companies in order to provide more or less the same services as municipalities. The potential for private providers to create new care delivery methods in the course of value-based competition has not been properly utilized.

Employers Employers are obliged to provide preventive occupational health care for their employees, but not for their family members. In 2004, about 84% of all employees in Finland were offered occupational health care by their employers. (SII 2007) As part of their occupational health care offerings, most large and medium-sized employers also voluntarily provide curative outpatient services. About 90% of employees receiving compulsory occupational health care services also receive some form of extra, voluntary services. Employers are free to determine the scope of these voluntary services (usually GP care). About 13% of all outpatient visits to physicians are provided by the occupational health care system.

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Employees are not charged for using these services, which are paid in full by their employers. Employers are partly reimbursed retrospectively by the NHI for about half of the expenses. Occupational health services can be provided directly by an employer through a company-owned and -run health care unit staffed by clinicians employed by the ﬁrm. Some employers choose to run occupational health centres jointly through a partnership with other employers. Employers can also purchase occupational health services from a clinic owned by another employer or employer group, which accounted for 42% of occupational health expenses in 2004; from municipal health centres, at 16% of expenses; from private health care providers, at 29% of expenses; or from other sources, at 12% of expenses.

Assessment The existence of these three systems can contribute to care cycle fragmentation because primary and specialty care might not only be delivered by separate provider organizations but also belong to separately funded health systems. While municipalities and private providers can and should move toward integrated care delivery models, occupational care is unlikely to evolve beyond simple curative care, thus creating a natural break between occupational providers and the public and private systems. Employees understandably welcome well-functioning ambulatory care services with no queues or fees at the point of use. Employers beneﬁt from a system that minimizes lost productivity or absences due to illness. From an equity perspective, however, the existence of a separate system for employed people is problematic. To maximize value, all individuals, many of whom are not permanently employed, should have smooth access to care. Therefore, the municipal system should provide at least the same accessibility to services as does the occupational system. Attempts to improve access within the municipal system should not end up weakening the well-functioning occupational system. Instead, health centres should be strengthened to reach or even surpass the level of occupational care. The role of employers in promoting the health of their employees is in most cases limited to providing occupational health care. However, employers increasingly go further by proactively encouraging and supporting healthy behaviour and lifestyle. Programmes aimed at making physical exercise accessible, fun, and trendy could improve employee health and become part of an employer’s competitive image, along with other health and wellness efforts.

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Patients Patient choice Many citizens can choose to obtain care from the municipal, private or occupational health care systems. However, substantial user fees can limit access to private services, and the scope of occupational health care services is often limited and available only to the employed. Therefore, the municipal health care system is the only option for poor or unemployed people. Within the municipal health care system, patients have had very limited freedom to choose their health care providers or physicians. As a rule, patients must use the health centre within their municipality of residence, except for emergencies. They cannot obtain public services from another municipality even if they are willing to pay out-of-pocket for their care. There is great variability across municipalities in terms of patients’ ability to choose their primary care physicians, with greater opportunities for choice in some areas. In municipalities where the “personal doctor” model is in use, a patient is usually assigned to the doctor responsible for his or her residential area. However, patients wishing to change their doctors within a health centre are usually accommodated. A referral from a licensed physician is needed to access municipal specialized care (i.e. hospitals), and patients cannot usually choose their hospital or specialists. Instead, health centres have guidelines listing the providers to which patients with certain symptoms and diagnoses should be referred. Normally, patients are treated in a hospital within their hospital district of residence, and their freedom to choose their physicians within the hospital depends on factors including the organization of departments and the number of specialists. One way to increase patient choice would be to give service vouchers to patients to obtain services from the providers of their choice. However, the use of service vouchers has been rather limited to date. Since the beginning of 2004, a new law has provided a legal framework for the use of vouchers in municipal home care services. At the beginning of 2007, about 25% of municipalities organized some municipal social and health services by offering service vouchers to patients. The services most often included home help and cleaning services as well as services to support informal care delivered by relatives. In 2008, the voucher programme was expanded to include home nursing. Although implementation has been rare, current legislation permits the use service vouchers for other social and health care services as long as patients’ out-of-pocket-payments do not exceed maximum legally defined user fees. For example, in 2007, the City of Helsinki began to give service vouchers to some patients in need of dental care. Helsinki has had significant difficulties in recruiting dentists, which has resulted in very long queues for services. With

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these vouchers, patients can go to private dentists for care and pay the same user-fee as in municipal health centres. There have also been pilot projects aimed at increasing patient choice of hospitals. In 2007, the neighbouring hospital districts of Pirkanmaa, Southern Ostrobothnia, Vaasa and Päijät-Häme started a two-year pilot project in which patients from the districts’ member municipalities could seek nonurgent care from any hospital within all four participating districts. In spring 2008, Coxa Hospital in the Pirkanmaa hospital district, started a campaign to actively inform patients of their freedom to choose Coxa instead of the hospitals within their local districts. This type of agreement had already been tested by two of the four hospital districts (Vaasa and Southern Ostrobothnia) beginning in 2003. The effort met with minimal success; only about 5% of patients travelled to the other hospital district for care. One challenge for these experiments has been the lack of proper provider-level outcome data; such data must be made available before patients can make meaningful provider choices together with their physicians and other caregivers. It is worth noting that the role of referring physicians is just as important as that of patients in terms of implementing and guiding the value-based choice of provider. The present government’s plans to merge the Primary Health Care Act and the Act on Specialized Medical Care in the near future (see p. 60) include the goal of increasing patients’ choice of providers in the municipal health care system. Citizens can inﬂuence decision-making in the municipal health care system through their votes in municipal elections every four years. The most important channel for the public to participate in and directly inﬂuence health care decision-making is through the municipal councils and municipal health committees that represent the municipal population. Hospital districts are also governed by councils and executive boards, both of which are elected by the municipal council members. Unlike the municipal system, patients reimbursed under the National Health Insurance scheme can choose any private provider in the country. Since care delivered by any private licensed physician is partly reimbursed by the NHI, private provider choice is not constrained by selective reimbursement agreements. In the occupational health care system, patients cannot typically choose their physicians.

User fees Legislation and government decrees deﬁne the maximum fees municipalities can charge for health care services, and they specify the services that must be provided to patients free of charge. Municipalities are permitted to set lower

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fees than those defined in the legislation, but they usually charge the maximum allowable rates. On average, user fees account for 7% of municipal health care spending. Usually, user charges are not collected directly at the point of care. Instead, each patient is given a bill that is paid by bank transfer. When an individual or family income is insufficient to cover the cost of care, financial assistance for user fees and outpatient drug costs is available from the municipal social assistance system. Preventive health care delivered by the municipal system, such as by maternity and child health clinics, is free of charge to patients. Immunizations, examinations, treatment of some communicable diseases as specified by law (e.g. sexually transmitted diseases, tuberculosis, hepatitis and some others), medical aids such as wheelchairs and other mobility aids, prostheses, and transport between health care facilities are also exempt from user fees. Children under 18 do not have to pay for health centre ambulatory services, such as physician checkups or dentist appointments, but they may be charged daily fees for up to 7 days of inpatient treatment at health centres or hospitals. A health centre may charge a per-visit or single annual payment for physician appointments. A maximum defined single payment is 12.8 euro, which can be charged for a maximum of three appointments. An alternative annual payment is a maximum of 25.6 euro per calendar year. Separate fees of 17.5 euros can be charged for each visit to a health centre emergency clinic outside of business hours, typically weekdays between 8 p.m. and 8 a.m., weekends, and bank holidays. Hospitals may charge outpatient consultation fees up to a per visit maximum of 25.6 euros, whereas the maximum fee for an outpatient surgery is 83.9 euros. The daily charge for health centre inpatient care is 30.3 euros, whereas daily hospital inpatient fees are 30.3 euros in general hospitals and 14 euros for psychiatric hospitals, which covers all examinations, treatment, drugs, and meals. The total annual user charge for public sector services is capped at 590 euros. After reaching the ceiling, clients receive outpatient services free of charge until the next annual period begins, with the exception of daily inpatient charges capped at 14 euros per day. Exemption from user fees upon reaching the annual user fee cap is not automatic, despite the fact that current information technology could facilitate an automated process. Today, patients themselves must collect all of their receipts for out-of-pocket payments and formally apply for the exemption. Outpatient drug costs are reimbursed through the NHI. Most outpatient prescription drugs and some over-the-counter medications are assigned to three different reimbursement levels: 42%, 72% and 100%. Patients are reimbursed 42% for most drugs. In addition, patients can receive “special” higher reimbursement for medications that treat specific chronic conditions or other serious diseases (e.g. hypertension drug costs carry 72% reimbursement, and

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cancer and diabetes medications are reimbursed in full). In order to get special reimbursement, patients must meet eligibility requirements outlined by the Social Insurance Institution (SII). For example, to qualify for special reimbursement for hypertension drugs, a patient’s blood pressure readings must exceed a speciﬁed lower limit. The patient’s physician must then submit a medical certiﬁcate to the SII stating that the patient has hypertension and meets the SII criteria; patients failing to meet the requirements for special reimbursement still receive the basic reimbursement. There is a maximum annual cap per patient for out-of-pocket drug costs (about 640 euros in 2008), after which point patients pay 1.50 euros per reimbursable prescription for the rest of that year. On average, the NHI covers about 70% of outpatient prescription drug expenses, and about 56% of NHI drug reimbursement spending in 2006 was for special reimbursement medications. In the private sector, patients initially pay all the costs for their treatment but they may claim partial reimbursement from the NHI and voluntary private insurance coverage. Fees for private outpatient and inpatient services are reimbursed by the NHI at a rate of up to 60% of the tariff guidelines set by the government, although many private providers charge fees exceeding the tariffs. To a lesser extent, voluntary private health insurance coverage is used to supplement the low NHI reimbursement rates. However, even accounting for voluntary insurance coverage, more than half of private health care costs are paid through out-of-pocket spending. By law, occupational health services must be completely free of charge to patients.

Assessment The government has cited increasing patient choice among its goals for health reform. According to a MSAH working group proposal, Finns should be able to freely seek care from any health centre within their own hospital districts. Moreover, a patient, together with the referring physician, would have the right to choose any hospital within the same tertiary care region. If the new Health Care Act is accepted by Parliament as proposed, these changes could take place as early as 2010. If used actively, the new dynamics could help to create a push for value-based competition for patients. However, experience from other European countries suggests that even when offered a free choice of providers, few patients seek care from outside their local areas. In an effort to increase the impact of the new right to choose providers, the government has announced plans to launch an internet service called Palveluvaaka (“Service Scale”) by January 2011. The online service will serve as

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a source of information on provider waiting times, costs, quality and cost-effectiveness of the services. From the patient’s point of view, the three separate channels for funding and care delivery offer diversity in terms of access to care, scope of the actual services and financial burden. Occupational health care provides immediate access to primary care with no out-of-pocket payments at the point of use. Out-of-pocket payments in the municipal health care system are modest, but the waiting times for care can be substantial. Private specialist services are widely available in large cities, but they may not be conveniently located for rural residents. Access to private care is also limited by price because patients are required to cover the majority of the costs of their care, which can be substantial. From a societal point of view, there seems to be some tension between competing goals. From the economic perspective of the nation and its businesses, it may be more desirable for the actively employed to receive services without undue delay. From the point of view of the basic human rights, as defined in Finnish legislation, services would be distributed according to health needs and the employed would not likely be favoured. In a value-based model, the system as a whole maximizes health outcomes per euro spent. One of the prerequisites for this is that in addition to emphasizing preventive care and health maintenance, high-quality care must be easily accessible to people with substantial deficits in achievable health status, and not be wasted on duplicative or unnecessary care. Research has shown that employed people, who enjoy better average health than others do, receive more physician visits than other patients do, which is a finding that persists after needs adjustment. This suggests that Finnish health care may not distribute its services in a way that would maximize health impacts. In the current era of the increasing prevalence of chronic disease, the “coproduction” of health by patients and their clinicians will be a key factor in any health care system’s ability to create and improve value. Health outcomes will suffer unless patients become full participants in and committed to their care. (The role of Finnish patients is discussed in the last Section of this document.)

Suppliers In 2006, the sale of pharmaceuticals (including inpatient and outpatient use) amounted to 2.4 billion euros, or about 470 euros per capita. (NAM 2007) In 2005, pharmaceutical sales accounted for 18% of total health care expenditure. Outpatient pharmaceuticals, including over-the-counter drugs, can only be sold to patients by pharmacies; nicotine replacement products are the sole

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exceptions, and they have been sold in grocery stores since 2006. Providers can only deliver drugs that are actually administered within their facilities. Health centres can give outpatient drugs to patients when local pharmacies are closed, but only in the dosage needed to cover the time until the pharmacy reopens. Pharmacies are heavily regulated. They are privately owned by pharmacists, each of whom can own only one pharmacy, and they cannot be owned by companies. The National Agency of Medicines (NAM) determines pharmacy locations and selects the pharmacists to run them. Retail drug prices must be the same in all pharmacies, and are determined by a combination of the wholesale price, the pharmacy’s profit margin (set by the government) and value-added tax. Pharmacies pay a tax-like graded pharmacy fee to the state based on their net sales. This fee minimizes the differences in income across pharmacies, but major differences in profits persist. The Pharmaceutical Pricing Board (PPB) at the Ministry of Social Affairs and Health sets the maximum wholesale prices for each pharmaceutical included in the NHI drug reimbursement system. Wholesale prices must be the same for all outpatient pharmacies (i.e. uniform pricing). Fixed wholesale prices do not apply to hospital sales because NHI reimbursement applies only to outpatient drugs. Drugs used in hospitals are paid for from hospital budgets, which in turn are funded by member municipalities or federations. The majority of prescription drugs with marketing licenses are reimbursed by the NHI according to the 42%, 72% and 100% categories (see Section 3). The Pharmaceutical Pricing Board (PPB) at the Finnish Ministry of Social Affairs and Health will decide to include a drug in the NHI reimbursement system if the PPB considers the price proposed by the pharmaceutical company to be reasonable in relation to its benefits as well as the costs and benefits of any therapeutic alternatives. As such, pharmaceutical firms applying to add a new drug to the NHI scheme must submit pharmaco-economic evaluations. The PPB also compares the proposed price to prices in other EU countries. Price competition among generic products is promoted by compulsory generic substitution, which has been a rather effective means of lowering their prices. Parliament has also decided to introduce a reference pricing system with effect from April 2009. The new pricing system is designed to further promote price competition by basing drug reimbursement on the price of the cheapest generic alternative, regardless of whether the patient actually purchases a branded drug or its generic equivalent.

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Assessment One obstacle inhibiting the rational use of drug therapy is the dual financing system, which creates cost-shifting problems between municipalities and the NHI. For example, health centres and hospitals have financial incentives to prescribe outpatient drugs instead of administering the drugs themselves, even when outpatient medications are neither economically or clinically the best choice. Moreover, the NHI and national administration have their own financial incentives regarding public drug reimbursement policy, which can work against consideration of drug therapies in a value-based context. These examples highlight some of the dangers inherent in paying separately for drugs and other types of health care. Separate payment systems can introduce the perceived need to cut costs for a particular type of spending rather than to take a longer-term, care cycle view that examines the ability of drugs or services to improve health over the entire course of activities needed to treat a particular condition. Unfortunately, even the payers responsible for drugs and services often do not support value-based reimbursement policies, favouring short-term cost-cutting strategies that invariably fail over time. Currently, physicians have minimal financial incentives for cost-effective prescription in outpatient care, and the NIH has few ways to influence a physician’s patterns of prescription beyond assigning drugs to particular reimbursement categories. The direct promotion of pharmaceuticals to physicians has been shown to promote over-prescription. Limits on public reimbursement for particular drugs have been set in some cases in the hopes of curtailing spending on pharmaceuticals. For example, in 2006 the PPB decided that the most expensive statins would only be reimbursed after less expensive statins had already been tried without success. However, constraining physician prescribing patterns is not the ideal way to promote the cost-effective use of medication, and other measures should be introduced in Finland. An OECD review of the Finnish health care system proposed that the funding of outpatient drugs should be integrated into primary health care budgets. (OECD 2005) So far, this proposal has been considered too complicated, and thus little action has been taken. If the proposal as it stands is not currently achievable, alternatives should be sought. Limiting physician autonomy to prescribe medications or shifting drugs costs to consumers in an effort to discourage their use are not constructive ways to enhance value. For inpatient care, physicians tend to assess drug costs more closely because the expenditure is included in the departmental budget. While it is prudent to be mindful of the cost of care, separately monitoring drug costs, rather than considering drug costs along with the costs of other activities involved in

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caring for a medical condition, renders value-based decision making almost impossible. Heavy regulation and universal drug pricing has effectively prevented competition between pharmacies. Wholesale drug prices are perceived as rather moderate compared to other European countries, but retail prices are high.

Clinical guidelines Several organizations in Finland provide information to clinical and administrative decision-makers regarding medical technologies and methods. Perhaps the most important is Finohta, an independent, state-funded centre for health care technology assessment (HTA) established in 1995 within the National Institute for Health and Welfare (THL). Finohta’s main objective is to promote evidence-based medicine and improve the clinical and cost-effectiveness of care (primarily diagnostic or non-drug treatment methods). Finohta coordinates HTA research, disseminates information and provides methodological and ﬁnancial support to research projects aimed at evaluating the clinical- or cost-effectiveness of a particular health technology. Since 1995, the Finnish Medical Society Duodecim, in cooperation with various medical specialty associations, has issued the National Current Care Guidelines. The goal is to set procedural standards based on the best possible evidence on health and cost outcomes. The guidelines are devised in working groups comprised of Finnish experts in the relevant ﬁeld. By June 2007, guidelines had been developed for 76 different diseases and medical conditions. The guidelines are to be updated every two or three years, and they are available online as well as in the Finnish version of the Evidence-Based Medicine Guidelines compiled by Duodecim. These guidelines are employed rather widely among physicians working in all parts of the health care system, although their use is entirely voluntary. Duodecim and its partners also issue patient versions of the guidelines that are more easily understood by non-clinicians. The guidelines are primarily intended for clinical practitioners, but they are also used to construct local care programmes and care pathways to integrate care processes across organizational borders. The Current Care Guidelines and care pathways are both constructed around health maintenance or care cycles (e.g. prevention and treatment of type II diabetes), and not around procedures. The Centre for Pharmacotherapy Development (ROHTO) was established in 2003 to provide the independent assessment of drugs and disseminate treatment guidelines and other evidence-based information to clinicians.

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The agency does not compile its own guidelines but uses existing guidelines from both Finland and other countries. The most recent effort in this ﬁeld is the Managed Uptake of Medical Methods (MUMM) project, a joint effort of Finnish specialty care providers (represented by the hospital districts) and Finohta. (Kaila 2008) MUMM’s main objective is to build a national system of early assessment of emerging technologies as well as joint recommendations for the uptake of these methods based on rapid reviews. Clinicians are involved in producing the reviews, and hospital and municipal leadership issue ﬁnal decisions based on the recommendations.

Assessment Finland has been at the forefront of developing decision support tools for clinicians using the latest technologies to aggregate and disseminate syntheses of the best current evidence-based research. Despite substantial investment over many years, evaluations of the guideline initiatives’ impact have been limited. Additional analysis of the effects of the decision support tools and their determinants would help to further develop these activities and enlighten future efforts. It is also possible that additional emphasis should be placed on implementation and marketing the tools. Numerous examples in international research literature have shown that the power of new ways to access valuable information alone may not be enough to reverse longstanding practice. From a value-based perspective, incentive structure is a critical factor influencing the creation and use of evidence-based guidelines. The guidelines should be developed based on solid evidence of value for patients. Providers then use the guidelines in order to improve their patients’ outcomes, thereby refining and improving the guidelines themselves and creating a data feedback loop. Today, health plans in many countries encourage high-quality care by rewarding clinician adherence to guidelines, irrespective of patient results. Rather than micromanaging care delivery by limiting clinicians’ ability to deviate from process guidelines where appropriate, and running the risk of stifling clinical innovation by freezing current clinical practice, health plans should indirectly reward appropriate adherence to guidelines by sending patients to clinicians based on superior patient outcomes.

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Health information technology

Most Finnish providers currently use electronic patient information systems. However, the development of health information systems has been largely uncoordinated at the national level, partly due to the decentralized health care system. As a result, several non-interoperable information systems are often used even within a single health care organization, which inhibits information exchange within and across provider organizations. This inability to communicate and the lack of information technology standards undermine the ability of information technology to enable value measurement and to restructure care delivery around the integrated care for medical conditions. The Ministry of Social Affairs and Health has been working to improve this situation for years. A major milestone in the development of information technology was achieved in December 2006, when Parliament passed new legislation concerning electronic prescription systems and patient records. According to the Acts, new national electronic databases for patient records and prescriptions will be formed, and the systems are currently under development. In addition to MSAH, the principal national actors in health information system development include the Social Insurance Institution, the National Institute for Health and Welfare and the Association of Finnish Local and Regional Authorities. All providers are obliged to adopt these systems and to achieve full functionality by 2011, after a four-year transition period. A central task will include setting standards for data deďŹ nitions and formats for storing and aggregating various types of data. In the new electronic patient information system, every provider organization will have its own patient record archive maintained by the Social Insurance Institution. However, the structure of the archives will be uniform and they will be stored in a single system. All public providers are obligated to maintain their patient record archives in the new system, but private providers are only required to join the system if they already have electronic archives.

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Every provider will be able to access all patient archives in the system through an index service; however, patient consent is needed to access another provider’s records. Individuals will have access to their own patient records as well as to information about who has accessed their records and when their records were accessed. In the new electronic prescription system, prescriptions are sent electronically from a physician’s ofﬁce to the national database to which pharmacies have electronic access. All providers will be obliged in 2011 to write prescriptions electronically, after the four-year transition period is over. Patients are free to refuse an electronic prescription and to receive a conventional paper prescription instead. There have also been efforts to improve clinicians’ and patients’ access to health information. In 2000, the Finnish Medical Society Duodecim launched the internet portal Terveysportti from which clinicians can access information on EBM guidelines, the Current Care Guidelines, drug characteristics and prices, the Cochrane Library, several leading international medical journals, ICD10 codes, a drug interaction database, a comprehensive list of Finnish Medical Terms and two leading Finnish medical journals. Almost all municipalities and hospital districts have purchased this service for their employees. It has become relatively popular, with about 30 million articles accessed in 2007. In 2006, Duodecim built a second internet portal Terveyskirjasto (“Health Library”, www.terveyskirjasto.ﬁ) for patients and the general public. The portal contains thousands of patient-centric articles concerning diseases and treatments, and many municipalities and hospital districts have linked this portal to their own websites. In 2007, about 20 million articles were accessed from the “Health Library”, and the portal is becoming increasingly popular.

Assessment Finland has achieved more widespread use of health information technology (HIT) than many other health systems, which is likely due in part to the historically high uptake of ICT solutions in various other sectors. However, simply automating paper-based processes is not the optimal use of health information technology. Instead, HIT should be used to enable and support key aspects of value-based health care delivery, such as implementing and improving integrated and coordinated care delivery models and collecting and analyzing health outcomes and costs. In these respects, Finland still has much room for improvement. A well-constructed national EPR system could lead to fundamental breakthroughs in managing and measuring health care in that common information management structures can be the most efﬁcient enablers of functional and

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organizational integration. Ideally, the EPR data would automatically produce key indicators on changes in health status as well as the use of resources. In recent years however, the pace of progress has failed to meet expectations. It is clear that the extremely decentralized and fragmented structure of health care delivery in Finland has been a key obstacle to the development and implementation of HIT systems capable of improving value in health care. In order to harness the potential of ICT for value creation, Finland should invest even more aggressively in health information technology and its implementation. While some national initiatives are underway, no agreement has been reached regarding the appropriate next steps. The lack of consensus suggests the need for more active national coordination and steering of key HIT policies and processes.

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VII Results measurement

The National Institute for Health and Welfare (now THL, since the National Research and Development Centre for Welfare and Health (Stakes) and the National Public Health Institute (KTL) were merged on January 1, 2009) has a central role in national data collection and reporting. It monitors and evaluates health and social welfare as well as related services and carries out research and development in those ﬁelds. THL also conducts research on diseases and their prevention and collects data on communicable diseases, health behaviour and the effects of health promotion efforts. The Social Insurance Institution (SII) produces statistics mainly relevant to the National Health Insurance system. Statistics Finland also plays an important role in compiling health service statistics. National information on the health care system and health status can currently be obtained from various statistics compiled from registers, regular population surveys and annual reports from service providers (see p. 87–88 for examples). The data are widely used for research purposes and they provide statistical information for decision-makers, which include statistics on the services delivered, costs, the patterns of disease in the population (national and regional) and health behaviour. A major shortfall is the lack of a comprehensive national register for service delivery in primary care.

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Examples of registries, regular surveys and statistics on health and service production A wide variety of registries is routinely collected in Finland from different sectors of society. Each of the registers includes an individual’s personal identification number. For research purposes and under specific data security legislation, these data from various sources can be linked at the level of the individual, which provides an extremely powerful analytical tool. This has been utilized in the PERFECT project, for example (see p. 89–90). Some register examples include: Register on causes of death. Statistics on causes of death are compiled by Statistics Finland from data obtained from death certificates, which are supplemented with data from the population information system of the Population Register Centre. Cancer register. The Cancer register is maintained for THL by the Cancer Society of Finland. Notifications on cancer cases are sent to the register by physicians, pathological, cytological and haematological laboratories and Statistics Finland (death certificate data). The register was established in 1952. Hospital discharge register. The registry, which is maintained by THL, contains client-specific hospital discharge data for institutional care including both social and medical services. Hospitals (both public and private) and health centre inpatient wards report the end of all episodes of care (including ambulatory surgery) to the registry. The registry includes data on age, sex, diagnosis, treatment and treatment period. Censuses are also conducted concerning all clients that have received care by the end of the calendar year. National health insurance register. The SII collects and reports information concerning National Health Insurance. This information includes data on drug reimbursement (utilization), sickness allowances, disability pension, occupational health services and private health care and rehabilitation reimbursements. Almost all these statistics are based on identifiable individual data. Statistics are also compiled based on survey and aggregate operational data. Use of these statistics in performance measurement is rather limited. Some examples: Annual survey on health behaviour and health among the Finnish adult population. Since 1978, the health behaviour and health of the adult population has been annually monitored through postal surveys conducted by THL. Each year a random sample (n=5,000) of Finnish citizens aged 15–64 years is taken from the Population Register. The average response rate has been 70% among men and 80% among women. The primary purpose of monitoring is to obtain information on health behaviour such as smoking, dietary habits and changes in ha-

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bits. The questionnaire also includes questions about the consumption of alcohol, physical activity, dental health, perceived general health and the use of health services. Health Care Activity Statistics. These statistics relate to public ambulatory health care and support services. The data are collected as summary data from health centres and hospital districts. The statistics are collected by THL. Statistics on Private Health Care. The statistics are based on activity reports submitted by private health care providers to the Provincial State Offices. The statistics are maintained by THL and they contain data on ambulatory service provision and employees.

Most health care service data and many non-health statistics are collected annually and stored in the SOTKAnet Indicator Bank maintained by THL. The Bank contains information on municipal finances, population, families, housing, social and health care personnel, health status, health behaviour, use of services and expenditure. Comparisons can be made at the national, regional and municipal levels, and the indicators can also be used to construct a time series. A process for the systematic collection of performance data – such as outcomes, productivity and cost-effectiveness of health services – is currently under development. Productivity metrics (i.e. the quantity of services delivered per unit of cost spent) for specialty care have been developed by the THL Hospital Benchmarking project, which was launched in 1997. Currently, this benchmarking system provides versatile information for inpatient and outpatient care, costs, and hospital productivity. Productivity is calculated based on data from the Hospital Discharge Registry and the data on costs that hospital districts provide at the hospital and specialty levels. Data from the Hospital Discharge Registry is grouped into DRGs (Diagnostic Related Groups). The data is then adjusted for risk by a hospital case-mix index at the DRG level. The benchmarking data has been integrated into national statistics since 2006, and they allow regional measurement of productivity and costs by indicating, for instance, the extent to which the costs of a hospital district or a municipality deviate from the national average and the extent to which this deviation may reflect the efficiency of care delivery and the per capita use of services. The Hospital Benchmarking data indicate that the productivity of hospitals in the municipal sector has decreased somewhat from 2001 to 2005, with falls from 0% to 13% in university or central hospitals. The data also suggest sig-

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niﬁcant differences in productivity between hospitals (Stakes 2007b), with a 20% difference in 2005 in productivity between the most productive and least productive central or university hospitals. Studies have also shown that unit costs for Finnish health care services are the lowest of the four largest Nordic countries. (Häkkinen & Linna 2007) One important example of the development of effectiveness and costeffectiveness measurement is the PERFECT project (see Box on the PERFECT project). According to PERFECT, signiﬁcant differences in clinical practices, effectiveness and costs exist between hospital districts, such as in the process and results of care for acute myocardial infarctions. Another somewhat different approach is a pilot project to collect quality of life information in the Hospital District of Helsinki and Uusimaa. In that project, adults’ health related quality of life is measured with the 15-D instrument, which is a generic and comprehensive (15-dimensional) self-administered survey. The survey is conducted before and after a procedure, which enables the analysis of both the effectiveness and cost-effectiveness of the operation. 15-D and other health related quality of life surveys are used to assess changes in health status due to care. These measures are applicable to almost any type of care, and they create a “common currency” to compare health outcomes across units and conditions.

PERFECT Project THL has made path-breaking progress in outcome-evaluation based cost-effectiveness evaluation (the PERFECT project). The project aims to develop indicators and models from register data that can be used to systematically monitor the effectiveness, quality and cost-effectiveness of care-cycles in specialized medical care across regions, hospitals and population groups. The first stage of the analysis comprises stroke, hip fracture, low birth-weight infants, breast cancer, schizophrenia, acute myocardial infarction, revascular procedures (PTCA, CABG) and hip and knee replacements (which cover approximately 25% of the expenses of specialized health care). For example, in acute myocardial infarctions (AMI), effectiveness is analyzed from data on mortality after admission and readmission to hospital due to MI. Clinical practices and quality are measured by the register data on operative and drug treatment. The project has found significant differences in clinical practices, effectiveness and costs between hospital districts.

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Cost of hospital care and one year mortality of AMI by hospital district 2003-2005 (risk adjusted1) 15,000 14,000

€/patient

13,000 12,000 11,000 10,000 9,000 8,000 7,000 15

Mortality (%) Source: Häkkinen U. Palveluketjut: Tapa mitata tuotosta ja tehostaa tuotantoa. In: Ilmakunnas S. (ed.) Hyvinvointipalveluja entistä tehokkaammin - uudistusten mahdollisuuksia ja keinoja. VATT Publications 48, Helsinki 2008. 1

Adjusted for age, sex and co-morbidity

Waiting times (as a quality indicator) are reported by municipalities and hospital districts and collected nationally. Hospital districts are also required to provide information on average waiting times to the public on their websites. For long-term elderly care, some countries have introduced an internationally developed and validated tool called the Resident Assessment Instrument (RAI) as a compulsory national method of measurement. The system has been piloted in Finland for a number of years. Today, the standardized assessment tool is used in the care of one of every three people in institutional care, one of every ﬁve elderly in home care, and about the same proportion of those in sheltered housing.

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Use of measurement data in health care management The use of performance measures in health care management in Finland is essentially non-existent. The main measures for steering municipal health systems are historical service volume, costs and productivity. Health outcomes, the most crucial of measures, are not routinely used to guide health system management, nor are they used as incentives to improve the actors within the system. The measurement of service volume is more common in hospital districts than it is in primary health care, in part because billing in several hospital districts is based on DRG pricing and partly because hospital districts are obliged to gather the data for the Hospital Discharge Register. The most widely used indicators are those produced by the Benchmarking and PERFECT projects. The Hospital Benchmarking data have increasingly been used to appraise and direct hospital activities. Hospitals use this information to compare their performance with other providers, to identify areas of poor performance and to learn from excellent providers’ successes. Some hospital districts have defined targets based on benchmarking data, for example to increase productivity by 1–2% annually or to have the hospital district placed in the top third of the benchmark’s component districts. In some cases, performance data are also discussed in public, thus further encouraging hospital districts to adhere closely to the data. Some hospital districts, such as Helsinki and Uusimaa, have also introduced their own performance gauges. However, these measurements are specific to the particular hospital district and therefore cannot be benchmarked against other districts that do not collect the same data. For primary care, most municipalities prospectively fund their health centre budgets without comprehensive and detailed data on service volume or efficiency. In recent years, however, some municipalities have introduced purchaser-provider splits in their administrative structures that have led to more explicit monitoring of service volume and productivity. There has been some progress in using quality and outcome indicators for the national steering of municipal activities, although these indicators are rather weak with regard to medical condition. In 2008, the government set specific targets for municipalities to improve their health services and public health from 2008–2011. These targets are to be followed-up regularly at the regional and municipal levels. The quantitative targets include the consumption of alcohol, the proportion of overweight people of working age, the proportion of smokers, the functional capacity of the elderly population, the number of home and recreational accidents, user satisfaction of health and social services, maximum waiting times, physician and dentist shortages in primary health care and geographical differences in the effectiveness of second-

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ary care. However, there are no external incentives for municipalities to achieve these goals.

Assessment Efficiency is a necessary but insufficient precondition for high value service provision. Ultimately, value is the relationship between the health outcomes achieved and the resources expended. Without proper measurement of both health outcomes and costs, value creation can only be estimated. Currently, many outcome measures are reported for a given population. However, the same data, which is based on observations of individuals, can be linked to specific organizational entities or medical conditions. National registers are promising tools for measuring outcomes in specialized care. So far, the data have mainly been utilized in medical research. However, by using these results to evaluate, improve and ultimately restructure care delivery, Finland could be a forerunner in introducing value-based outcome measurement systems. A key issue will be the ability to link value measurement with incentive structures and providers’ actual management decisions. Development of productivity measurement has progressed well for Finnish hospital care. In primary care, however, the measurement of productivity is in its infancy. For hospital care, productivity comparisons between hospital districts could be improved by developing a uniform national method for defining and pricing services in hospital districts. The national government could play a much stronger role in this process. Currently, hospital districts use different systems to define the pricing of services. The data collection practices used by the Hospital Discharge Registry could also be improved because some information, such as secondary diagnoses and procedures, is incomplete. Productivity measures, however, are just the beginning. Measurement should be rapidly expanded to the quality, outcomes and cost-effectiveness of whole care cycles. A key source of data for outcome measurement could be the national electronic patient record system targeted for 2011. However, obtaining useful data from this system to measure performance will be difficult without additional consideration and possible modification because the system was not developed for this purpose. Researchers should be involved in the development of data definitions and classifications. An additional measure might include measuring quality of life in relation to health, such as 15-D, more widely and systematically. The development of activity registers for primary health care is a major challenge. One option is to develop EPR systems in primary health care to serve as the data sources for productivity and results measurement.

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Another key challenge is how to collect performance data, link the results to strategic planning and management decisions and use them to align incentives for the actors in the health care system around creating value for patients. One step in this direction would be to establish the “Service Scale”, which is due to become operational in January 2011. The fully open internet data source for information on access, costs, quality and effectiveness of services by providers will undoubtedly have an effect. Together with the simultaneous increase in patients’ freedom of provider choice, the Service Scale will create a positive competitive pressure for providers to improve their outcomes. Even if patients’ provider selection does not change substantially as a result of the information, public availability of the data combined with the high level of ambition among Finnish health professionals is likely to spur providers and individual clinicians to focus on improving patient outcomes. Performance indicators will have to be further developed before they can be used as ﬁnancial incentives or tools to help patients choose their providers. Ideally, measures should concentrate on the outcomes of care because payfor-performance measures tend to concentrate on and reward adherence to particular care processes rather than on patient outcomes and value. Stronger national steering and funding is needed for the development and uptake of performance measurement in Finland, and there is a possible need for a national programme. Providers should also be given stronger incentives to develop and report these indicators. In the long run, it is essential that physician and provider incentives be fully aligned with value-based ideals. In Finland, this could be achieved by encouraging municipalities to allow and encourage patients to seek care from excellent providers, which includes organizations outside their own municipalities and hospital districts. Outcome measurement is a critical tool to enable this shift. In the future, performance indicators could also be used to allocate state subsidies for municipal health services.

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VIII Overall assessment and recommendations

After World War II and the public health crisis of the 1960s, the Finnish system recreated itself and today it is widely considered one of the leading national health systems. Finland has been able to balance the provision of universal coverage for a broad array of services with effective cost control to a greater extent than many other countries. Finland’s achievements create a promising platform for the next generation of health care reforms. It will no longer be enough for Finland to offer universal coverage while attempting to restrain costs. Moving forward, Finland must refocus its health care system on improving health outcomes and the quality of care across all services and providers, which will not only improve value for individual patients but will also help to ensure the ﬁnancial sustainability of public universal coverage in the face of an aging population and growing public expectations of the system. Incremental improvements of the regulation or care delivery processes will not be sufﬁcient: the next generation of governance must build upon Finland’s past achievements by making substantial “quantum leaps” toward a high-value system of health care delivery. In Finland, the geographically organized care delivery system combined with public funding and universal access to care has been a key enabler of past achievements. At the same time, the structure of the Finnish system creates monopolistic dynamics where municipal payers and public providers do not face true competition for patients. This lack of competition, coupled with a lack of results measurement, has likely hindered the speed of innovation and therefore improvement in the models of care delivery. Many of the recommendations are linked directly or indirectly to the idea of using competition and choice to improve value. However, it must be stressed that competition is not a goal in itself but rather a tool to enable the continued improvement of the system. The application of principles of com-

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petition to health care extends to all actors, regardless of ownership structure or funding sources. In other words, competitive principles are equally applicable to public and private organizations and systems. Increasing the controlled competition for patients can jumpstart and sustain major improvements in health outcomes and value. This is perhaps even more relevant to competition between the public payers and providers who have been shielded from competitive forces to date. Most of the following recommendations deal mainly with curative services in treating individuals who already have one or more medical conditions. However, it is necessary to remember that prevention is often among the highest value forms of care. The population-based orientation toward health promotion and primary prevention, which have long been at the core of health care ideology in Finland, must be strengthened further. Effective treatment and health promotion should not be seen as competing activities. On the contrary, both are prerequisites for the continuous improvement of the health of the Finnish people.

Intensify outcome measurement and link it to incentives and management Health care delivery, like all public and private industries, requires measurement in order to improve. Therefore, a value-based health care delivery system unequivocally requires measurement of both health outcomes and costs at the level of the patient over the full cycle of care for each medical condition. The health outcome and cost components of the value equation are strongly linked; achieving better health outcomes is the best way to drive down costs over the long term. Finland has a long tradition of national hospital care registers and other databases that collect essential information related to health care delivery. During the last decade, health services researchers and clinical experts have created methodologically advanced analytical tools to utilize this data. So far, however, these tools have mainly been used in research projects to compare hospital productivity. Now this information must be analyzed and mediated in a way that drives value improvement by highlighting successful care delivery methods and providers as well as areas for improvement. At least two major steps must be taken to allow results measurement to drive value creation: expanding the scope of medical conditions and the types of providers for which the results are measured, and using the results to guide the strategic management and organization of providers. For specialized care, data analysis can already combine various inpatient admissions and outpatient visits and include all care delivered to a sin-

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gle patient in order to treat a particular medical condition. However, primary care, rehabilitation, outpatient social and mental health services and elderly care are not routinely collected or analyzed at the individual patient level, thereby omitting the important front- and back-end portions of the cycle of care. Instead, the care delivery processes, outcomes and costs of care are often evaluated using aggregate figures from units or even data for entire municipalities. Development of the next generation of outcome indicators is already underway. As described earlier, (see Section 7 on results measurement), there have been a number of pilot initiatives to test primary and elderly care outcome measurement. The results and lessons learned from these projects should immediately be analyzed and reported. In the future, the collection and analysis of the results of inpatient care, outpatient care, long-term care and health-related social services should be standardized at the national level to ensure the comparability of information. Investment supporting the universal adoption of these tools would raise the potential for the improvement of care delivery to a radically new level. Universal, standardized outcome measurement will require a process to determine which outcomes should be used, and it may require the development of new measures for some conditions. For some types of care, however, existing measurement efforts can be expanded across all providers as a first step towards a comprehensive measurement effort. For example, for inpatient and outpatient specialized care, the methods developed by the PERFECT project (see Section 7), and by hospitals using patient level health-related quality of life (HRQoL) surveys to assess changes in patient health status, could be standardized across providers and expanded to cover all specialized and primary care for relevant medical conditions. There are challenges in expanding and further refining measurement technologies. However, there is an immediate need for comprehensive information at the level of the provider for all types of care, and it should not be postponed. The best way to speed the development of methods and data sources is to make them visible through active use. If the uptake of measurement indicators is not broad enough, all providers must be obliged to report results according to a defined data set. The existence of measurement efforts alone is not enough. They may not meaningfully improve value unless providers have access to their own results in order to see how their care compares to others. Results should also be available to referring doctors. One effective way to create incentives for providers to take their own results seriously is to publicize key results at the individual provider level. In this respect, Finland has been less proactive than some countries with less developed data collection efforts.

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Health care providers and professionals should not only support results measurement initiatives, but they should be leading the call to action. Through information, providers can be credited for excellent performance and improve areas of weakness to better serve patients when appropriate. Without results information, providers will be subject to micromanagement. They will also be under constant pressure to cut costs in ways that may harm patients. In addition to driving value improvement, public reporting of health outcomes and cost data is in line with the general principles of transparency to taxpayers, who are the ultimate payers of the publicly funded Finnish health services. Finnish taxpayers are also patients. A public call for results measurement and improvement would likely accelerate change because patients would appreciate the opportunity to see how various providers perform when seeking care themselves. While some patients might choose not to use the information to inform their provider selection, municipal payers could begin to base patient flow on actual results and guide patients toward excellent providers. Municipalities should also measure health outcomes for their local residents. These value metrics should serve as tools for municipalities to gauge the effectiveness and efficiency of all care delivered to their residents. Outcome data is also of key importance to physicians and integrated practice units in terms of improving practice and enabling performance-based referrals. Today, state subsidies to municipalities are based solely on demographic information and other indicators of service needs. The national government might also consider linking the transfer of health care funding to local governments with improved health outcomes. However, external rewards for provider achievements run the risk of unintended incentives, such as neglecting care for conditions with inherently poorer potential for improvement (e.g. due to the state of medical science or due to already high treatment success rates and the efficiency of care). They may also reinforce the widespread but often misguided belief that high quality care is more expensive. The best way to reward high-value providers is through patient volume, allowing them to expand and improve still further.

Create integrated practice units To maximize value creation, all of the activities needed to care for a particular medical condition, or set of commonly co-occurring conditions, should comprise a patient-centric, results-driven cycle of care. To best achieve this, the organization and delivery of care must be designed according to the conditions faced by the patients, rather than around clinical specialties or hospital departments and divisions.

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Compared with most health care systems, the Finnish model has some strong elements of integration. Health centres have an exceptionally wide range of professionals serving patients in or close to their communities, although co-location is not the same as integration and the extent to which clinicians actually work together as teams is variable. Working as salaried employees has helped them to establish team-based practices not often seen among private practitioners. Hospitals have created condition-specific care units, which in many cases employ multiprofessional and multidisciplinary teams to deliver patient-centric care. Physicians, working as a team, use second and third opinions more as a rule than an exception. Primary as well as specialized care have together designed “care pathways” that outline integrated processes and delineate each organization’s role. These are among the Finnish experiences that can be drawn upon to create disease or condition specific units. Care cycles involving specialized care are rarely limited to a particular specialty. Even if all acute interventions were performed in the hospital by a single care delivery team, early detection, follow-up and rehabilitation would still be delivered quite separately by health centres under the current system structure. This induces poor coordination of care with associated quality problems, duplication of work and redundant administration. Maximizing value across a whole care cycle should involve primary, specialized, social service and rehabilitative clinicians working together as a unified entity. Therefore, the next step toward the reorganization of care delivery in Finland should involve moving towards the true integration of primary, specialized and other types of care within integrated practice units for medical conditions. Some providers may be able to move quickly to IPU models while in other settings, the creation of IPUs may take place as a series of steps. A first step might consist of increasing specialist involvement in primary care. Supported by specialists, health centres could provide many patients with certain common conditions such as diabetes or hypertension with virtually all of their care in primary care settings. All clinicians treating a patient’s condition would work together toward the common goals of primary and secondary disease prevention, with hospital admissions becoming the exception rather than the rule. And hospital visits that did occur would primarily be brief, planned interventions involving mainly ambulatory services. Even in the case of acute, unplanned admissions, the health centre would remain involved in patients’ care and it would work with hospital clinicians to determine which inpatient services best fit their patients’ overall care plans. Planning for future ambulatory care needs would therefore begin at the moment of admission, rather than via a separate “discharge planning” process. As health centre team members, specialists would enjoy much broader roles than simply providing consultations for individual patients. The special-

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ists would also act as “team captains”, consult with and train other team members, serve as quality management experts capable of contributing to innovative care processes, and possibly function as care coordinators across the hospital-ambulatory care division. In the second step, IPUs, which were formally organized as entities with a single management, budget, and strategy (including IPUs located within general hospitals or other multi-specialty providers), could move beyond the primary care setting. The details of IPU design and organization would vary considerably within and across providers and medical conditions. In larger cities and for common medical conditions, high local patient volumes could allow each IPU to concentrate on a narrower segment of the population with a medical condition. For example, while a rural diabetes IPU might treat all diabetic patients, a larger urban IPU might specialize in type I diabetes or in patients with advanced disease. Some IPUs, particularly those relating to primary care, might also be organized around a set of common activities needed to care for a patient population rather than a medical condition per se. In primary care for mainly healthy individuals, for example, the core challenges are keeping people healthy through activities at the individual and population levels and preventing diseases, particularly among those with elevated risk factors. The “medical condition” is therefore effectively health maintenance. Most people, especially those up to middle age, only use occasional services to maintain their health or to obtain care for minor medical conditions. Therefore, IPUs with health maintenance orientations offering a range of common primary, preventive, and possibly related social services, would become common. As the Finnish population ages, increasing the proportion of individuals with several chronic conditions, the treatment of common sets of co-occurring conditions among elderly patients could also be coordinated by an IPU speciﬁcally targeted at that population. Conceptually similar to a health maintenance IPU for younger patients, an elderly care IPU would require different types of staff and services in order to maintain the more tenuous health of its patients. An elderly care IPU might employ a team approach to delivering primary care services as well as the non-acute care of chronic conditions for frail elderly individuals. Such an IPU would include or work closely with the social services. Close collaboration would be secured with several medical conditionbased IPUs for the treatment of acute or unrelated medical conditions as and when necessary. To support the reorganization of care within IPUs, funding and billing arrangements will also have to support integrated care. (Value-based reimbursement models are discussed below.)

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Strengthen primary health care Primary care is a cornerstone of a value-based health care system and an efficient vehicle for primary prevention, screening, and early intervention. Organized properly and working together with other community services, primary care can also be a key component of health promotion amongst the population. Often serving as patients’ first point of contact with the health care system, primary care providers can engage in pre-emptive health maintenance strategies rather than react to patients presenting themselves for care only after becoming ill. Primary care providers also play critical roles as major referral sources for specialized care services as well as in coordinating their patients’ care across several providers. Through strong linkages with social services, including unified health and social care centres and other partners in local communities, primary care providers can be essential to avoiding the medicalization of non-medical problems. In many ways, health centres are the crown jewels of the Finnish health care system. The dense network of community-based multi-professional units is an asset that must be strengthened, and not jeopardized. Many experts agree that the crucial functional challenges facing health centres today are a shortage of skilled personnel (especially physicians), the slow development of new and innovative preventive care models as well as rudimentary data tracking quality and outcome measures for primary care. While progress to date has been slow, some promising initiatives are already underway. New ways of distributing responsibilities, both among physicians and between physicians and other clinical staff, are being actively piloted in health centres, and they should be encouraged. Improving human resource management, outcome measurement, information technology, patient involvement, and innovation uptake are among the Finnish system’s current improvement efforts. The present government’s public, high political level commitment to strengthening primary care is a promising sign that many current efforts are likely to continue and expand. The “Effective Health Centre” programme, which was launched by MSAH in 2008, will address many of the problems with concerted actions by the state, municipalities, universities and other key actors. Most experts agree that two main structural obstacles are currently impeding health centre development. First, insufficient coordination between primary and secondary care is a major challenge. New models of true organizational integration, where one organization provides both primary and specialized services, have been implemented in sparsely inhabited parts of the country. The adoption of new organizational models is lagging in the densely inhabited areas where most Finns live.

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To maximize value for patients, care delivery has to be seamless - as if all services were delivered by a single actor with a common administrative structure. Indeed, in some cases, much if not all of the care needed to treat a particular medical condition should literally be delivered within a single provider organization that integrates primary, specialized, rehab and social services. Hesitant attitudes among primary care and secondary care providers as well as among policymakers can best be overcome through action. New models of service integration have to be created ambitiously, and results must be measured. The integrated practice unit (IPU) approach described above provides a natural framework for integration. Successful models will benefit all parties, especially physicians who will find themselves more efficient and able to meet the needs of their patients. Second, the parallel municipal and occupational primary care funding channels create obstacles to moving toward value-based care models. In some ways, the parallel arrangement seems attractive. Employees enjoy quick access to occupational care, employers can tailor the services they offer to drive higher productivity within their individual workforces and municipalities may save money because some of the health care costs are shifted away from them (although physicians in the occupational system still refer patients to municipal hospitals for inpatient care). From a value-based perspective, however, long-term problems are clear. Municipalities may try to shift costs to the Social Insurance Institution and employers by letting queues delay access to health centres. Moreover, employers have no incentive to limit occupational referrals for municipality funded specialized services. As a consequence, recent years have seen a steady shift in primary care visits by employed people from municipal health centres to occupational care providers. In the long run, this trend may seriously threaten the viability of municipal care. If employed people opt for occupational care, leaving municipal health centres to care for the poorest and sickest patients, it would be questionable whether the municipal system could maintain staff levels and improve quality. There are no easy solutions. Fully separating the municipal and occupational services so that each patient receives all care within one system is not feasible because most occupational care providers offer a limited scope of ambulatory services. One solution that would eliminate the perverse incentives described above would be to combine the funding channels under the governance of a single “health plan” (i.e. either the municipalities or NHI). Alternately, employers could be required to pay for a small percentage of specialized care resulting from occupational referrals. However, such a move would risk discouraging expanded occupational health services and reduce overall investment in primary care.

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Create true health plans Patients have an important role in a value-based health care system, but they cannot be expected to select their providers and organize their care unassisted. Ideally, patients would be guided not only by their primary care clinicians but also by health advisors whose interests are closely aligned with their own. In most countries, this task is left by default to the payers. However, few public or private payers have embraced this role to a sufficient degree. In virtually all systems, payers must redefine their roles and move from passive reimbursement vehicles to true “health plans” that assemble all patient information and guide their beneficiaries to the high-value providers best equipped to care for their medical conditions whilst factoring in patients’ individual preferences. In Finland, the “health plan” mandate is clearly designated to the municipalities. According to Finnish legislation, municipalities are responsible for ensuring sufficient health (and social) services to anyone permanently residing within their borders. The constitution gives municipalities substantial autonomy to carry out this responsibility, which is an independence reinforced by the fact that they are governed by democratically elected bodies and they can levy their own local taxes. Despite this mandate, certain factors constrain municipalities’ ability to function as true health plans. Many municipalities are quite small and lack the financial and human resources to aggregate the necessary information and to navigate and influence an entrenched and complicated care delivery system. The municipalities are also legally obligated to belong to one hospital district, which in practice limits their ability to direct patients to highest value specialized care. There is limited proactive involvement with patients or municipality residents. Most hospital admissions take place without referrals from municipal health centres (either when patients directly present themselves for care or when they are referred by private practitioners or occupational health care). Despite an encouraging trend toward the consolidation of municipalities, many newly merged municipalities will remain small. The consolidation of municipalities is a highly political issue, and it is unlikely that attempts to force them into fewer, markedly larger units will occur over the near term. One structural change that could quickly give municipalities more power to guide patients to high-value providers would be to end the requirement that municipalities belong to a single hospital district. (This line of discussion is explored further below.) Another policy that should be re-examined is the requirement that municipalities pay for hospital care resulting from private practitioner and occupational health physician referrals. However, municipal health centres are often understaffed, and they cannot always guarantee rapid access to primary

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care services. Therefore, requiring health centre referrals to ensure public reimbursement for inpatient care would create a public outcry. Many municipalities themselves would likely oppose such a measure, fearing a sudden increase in demand for primary care services and GP physicians. However, these questions should be revisited as primary care clinician shortages are addressed. Ultimately, the ability of a municipality to act as a true health plan depends upon its ﬁnancial and human resources. If the municipalities do not consolidate further, they will have to develop new ways to promote closer collaboration and enable greater provider choice. Currently, municipalities have joined together to organize inpatient and other specialized care delivery through hospital districts. In the future, co-operation across municipalities should allow patients to access the best possible care for their medical conditions rather than funnel them all to a single hospital or small group of outpatient providers.

Reimburse full cycles of care Most providers analyze their activities at the level of individual visits, admissions and procedures but from the patient’s point of view, care can consist of a lengthy series of actions over time and across provider settings. Value is created or destroyed by the net effect of all services needed to care for a medical condition. Most providers are reimbursed via global budgets or fee-for-service arrangements. Providers subject to global budgets are paid a single lump sum intended to fund all care delivered over a period of time (generally one year). Global budgeting, a version of which is used in Finnish municipal health centres, carries the inherent risk of encouraging service rationing. When global budgets are approached or exceeded, potentially high-value, non-acute services such as preventive or consultative care may be restricted or denied in order to cut costs. Global budgets also focus attention on aggregate organization costs rather than on examining the costs to treat the medical condition, the point where value is actually created. Providers with fee-for-service reimbursement arrangements are paid separately for each individual intervention as it occurs. This system, derivatives of which are used in Finnish hospitals, embodies the risk of the over-provision of care, poor sensitivity to quality problems, and a short-term focus that fails to consider the effects of services delivered earlier or later in the cycle of care on outcomes and costs. In a value-based system, reimbursement would be bundled for the medical condition to include all of the services required to treat a patient across the full care cycle (or for a particular period of time in the case of many chronic

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conditions). Bundled payments for most conditions would include outpatient visits, tests and imaging, drugs, inpatient care and rehabilitation. Even prevention is conceptually part of the care cycle for most conditions, although separate bundled payment for prevention as a distinct set of activities is also desirable in many cases. Bundled reimbursement avoids the misaligned incentives of global budgeting and fee-for-service systems. Instead, it aligns payment with the unit of value creation – the care for an individual patient’s medical condition over the full cycle of care. Finland has both the technical prerequisites and practical experience to move quickly toward bundled reimbursement for the portion of care cycles involving specialized care. Each individual patient is assigned a personal identification number used by clinical databases, enabling the aggregation and analysis of all specialized care delivered to a particular patient across providers. However, reimbursement methods have remained unchanged even within specialized care. Moving to bundled reimbursement for full cycles of care within the current care delivery system, which separates primary and specialized care services, could prove difficult. However, reimbursement reform does not have to wait for care delivery to be restructured and could instead be used to encourage and speed the reorganization of care. An important step that could be undertaken quickly would be to structure all contracts between municipalities and hospital districts (or other service providers) in terms of care cycles for particular medical conditions. Providers would then have the flexibility to deliver the care best suited to each patient without micromanagement or mandatory adherence to detailed process guidelines. Bundled reimbursement would also increase provider incentives to get things right the first time because they would no longer receive additional reimbursement to address medical errors or complications. A number of other initiatives should also be undertaken to facilitate the use of bundled reimbursement for care cycles. Patient classification systems could define “true diagnosis related groups” that extend beyond the current scope of DRGs (inpatient episodes) to cover entire care cycles. The “true DRG” classification would not depend upon actual services delivered or the volume of procedures performed. Legislation for data security and care process reporting should be reviewed in order to remove any unnecessary obstacles to full care cycle analyses. Similarly, all ICT solutions should be developed in a manner conducive to a full care cycle approach to reimbursement. Such a methodology must be adjusted properly for patient risk factors and initial conditions that not only affect outcomes but can also lead to very different costs. One of the central goals of the next generation of EPR solutions should be the ability to aggregate all relevant data on care delivered across provider settings to encompass truly complete care cycles.

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It is necessary to remember that the care cycle approach only works properly when coupled with health outcome and cost measurement. Without proper measurement and monitoring of health outcomes, reimbursement based on a care cycle could lead to service rationing, not unlike global budgeting systems. The idea is not to use ﬁxed, capped reimbursements to constrain costs but rather to allow providers the ﬂexibility to deliver the best possible care for a patient’s medical condition over the entire cycle of care.

Increase value by service consolidation combined with competition Although the integration of primary and secondary care is of the utmost importance, the geographical rationalization of services is also essential for value improvement. In most countries, hospitals have traditionally aimed at “serving the community” by offering a full set of services, regardless of patient volume. The community service mission made sense decades ago, when the set of available treatments was much less advanced and when travelling even relatively short distances could be complicated. Today, the care for many common conditions can include technically advanced, high skill treatments and involve many types of physicians and other skilled staff. Ample evidence has also shown that sufficient patient volume and the subsequent accumulation of skills and expertise are key drivers of value for patients. Concentrating care for a particular condition within fewer, high-volume centres facilitates faster learning, being incorporated into practice, and improved patient health outcomes. Finnish studies confirm the massive, yet largely untapped potential for value creation by reducing the fragmentation of care delivery. Even complex, technically demanding surgical procedures are being performed in small numbers by many Finnish hospitals, with highly variable costs and health outcomes. But the data highlighting the variability of costs and outcomes across providers has not yet led to major changes. The lack of competition for patients among Finnish providers is a key enabler of the status quo, allowing hospitals delivering poor outcomes or inefficient care to maintain patient volumes and remain financially viable. Some steps to reduce this fragmentation are already in the pipeline, including the new national Health Care Act scheduled to take effect in January 2011. According to the draft of the Bill, the country’s five tertiary care regions will receive a clear legislative mandate to plan the distribution of responsibility for health care services within their boundaries. These regional actors will then have legitimate grounds to encourage hospital districts to limit the set of conditions treated by each provider. It remains to be seen whether these choices

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will be made on the basis of value rather than politically motivated compromise or other considerations. The new Health Care Act also proposes a significant increase in patients’ freedom to choose their providers. According to the draft of the Bill, each patient, together with his or her physician, would be free to seek care from any hospital within the tertiary care region (as opposed to the smaller secondary hospital district). Supported by comprehensive results measurement, this provision would introduce a powerful new incentive for hospitals to demonstrate and improve value for patients. Municipalities will also benefit from patients’ expanded freedom to choose providers because they will have greater freedom to guide patients to the providers likely to achieve better results for the resources spent on care. No longer constrained by tight geographic boundaries, municipalities will be free to guide patients towards the best and most efficient care, and not just the closest. It will also be in the municipalities’ interests to ensure that their own hospitals demonstrate excellence in certain services in order to attract patient volume and inter-municipality revenues. Actions taken in the coming years will determine whether the new Health Care Act will meaningfully improve care delivery by expanding provider competition for patients. It is possible that even after the new legislation takes effect, inertia, loyalty, municipal tax income linked to local hospital activities and municipality ownership of the hospitals will deter some municipalities from guiding patients for care beyond their borders. Transparent municipal health outcomes will be crucial to counter any lingering financial incentive to refer patients locally. As discussed earlier, lifting the requirement for municipalities to join hospital districts might also help mitigate some of the local hospital district orientation. If hospitals were to become either independent organizations or at financial arms length from municipalities, they might adapt more easily to patient needs, and therefore municipality needs, with fewer political constraints.

Encourage innovation in care delivery and its structures In any product or service industry, innovation is the key driver for value improvement. There is probably no other sphere of activity in which this should be more so than health care. Aging populations, rapid progress in medical science, rising public expectations and other trends are reshaping and generally increasing the need for care. The growth in demand for care seems to be moving at a markedly faster pace than any foreseeable change in the gross domestic product.

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There are limits to the benefits achievable by incremental improvements in efficiency within the current health care delivery and organization structures. The only sustainable way forward is to create new ways of organizing and delivering services, which are often called service innovations. A striking dilemma is taking shape in all advanced economies. Clinical medicine continues to be one of the most innovation-intensive spheres of society, with therapies continuously changing and improving. At the same time, cutting-edge health services are delivered by organizations structured as they were centuries ago. Hospitals and physicians’ offices remain the settings for the vast majority of care provision. This model is unsustainable in the current age of chronic disease and aging populations. In many ways, Finland is among the world’s leaders in terms of realizing the need for service innovation. Finnish decision makers are to be commended for their substantial investment in projects aimed at developing new ways to organize and deliver services. Public investment through MSAH, Tekes and other efforts has been substantial in monetary terms. Despite significant funding aimed at innovative approaches to Finnish health care delivery, it is generally agreed that the uptake of new care processes and organizational structures remains far below a desirable, or even sustainable, level. It seems unlikely that additional government investment in care delivery innovation alone will produce the results needed to meaningfully affect the creation of health care value over the short- or medium-term. New innovation programmes aimed more directly at reorganizing care delivery or otherwise driving value improvement should be developed and funded by (or in conjunction with) groups of municipalities. The next wave of funding aimed at improving innovation in health care should evaluate potential projects in terms of their ability to raise health outcomes and lower costs. Only projects with feasible long-term effects on value would be funded, and only service delivery models demonstrating evidence of value improvement would be rewarded. Among other things, this would mean that at least part of the programme funding would depend on reliable ex post assessment. Since the early 1990s, municipalities have had the option to procure health care services not only from not-for-profit “third sector” organizations but also from private for-profit providers. Although the vast majority of health care services continue to be delivered by publicly owned and funded providers, the proportion of care delivery by private providers has steadily increased. Today, municipalities normally contract for provider services in terms of service volume, although some quality indicators (largely process measures) are increasingly included in public contracts. In most cases, the contracts are renewed annually with little review or consideration, let alone results measurement. In practice, this leads to a situation where private providers mainly rep-

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licate the care delivery processes used by public units, which leaves the ability of positive sum competition to drive innovation unexploited. Rather paradoxically, this situation seems to be well accepted by private service providers. In a value-based health care system, procurement contracts for care delivery should be based on value and reward high-value care or products with additional business (i.e. more patients or larger contracts). Since value is created over the entire cycle of care for a medical condition, provider contracts should cover full cycles of care or as much of the cycle of care as possible. Contracts should not rely upon process standards as proxies for true health outcomes or pay-for-performance arrangements to encourage providers to follow fixed guidelines. Value-based contracts should have sufficiently long timeframes to allow provider investment in care reorganization and improvement and align their financial incentives with longer-term health outcomes. Actual health results, rather than service process content, would be rigorously monitored, thus creating a strong incentive to identify and implement processes leading to better value. A step towards more innovation might involve the creation of long-term partnerships between municipalities and providers (both public and private). Longer contracts coupled with proper outcome measurement would set the stage for value improvement. Here again, the necessity of effective health outcome and cost measurement cannot be overemphasized. The uptake and utilization of innovations will be strongest if value-based competition prevails for all providers and municipalities. Therefore, any reforms that increase positive-sum competition will also promote innovation. In practice, controlled steps to loosen provider monopolies encourage new forms of integrated provider monopolies and to expand patient choice of providers are all conducive to innovation.

Invest in health information technology In many industries, ICT has not only streamlined operations but has also reshaped the market and improved value in fundamental ways. But despite the information and knowledge intensity of health care, standardized ICT use and development lags far behind most other industries in Finland as well as other advanced economies. The health care systems that can best harness the potential of ICT to enable the reorganization of care delivery will be forerunners in moving towards high-value models. Finland already has a number of demographic and other strengths that will enable health information technology to drive value improvements. Finland has an excellent education system and enjoys an overall public familiarity with and willingness to use new technologies. Other Finnish industries, led by

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the successes of Nokia and Linux, have rapidly become global leaders in ICT and further accelerated the rapid adoption of information and mobile technology within the country. Universal personal identity codes already enable the aggregation of all specialized care data pertaining to an individual patient, and they could be expanded to include other provider types. However, the public administration of health care delivery in Finland is even more fragmented than in many other advanced economies. Many ICT initiatives currently differ across municipalities, and the development of a nationally uniform, standardized infrastructure will require strong national guidance and oversight. If left to individual municipalities, providers and suppliers, convergence will be haphazard and slow. In the past, IT suppliers have created customized solutions for individual provider organizations and municipalities without clear standards to ensure information sharing and interoperability, which has led to counterproductive silos within and across providers. Some promising steps towards standardization have been made over the past few years. Virtually all health care units now use electronic patient records (EPR). National coordination has made it possible to create a national data archive for EPRs as well as a national system for electronic prescriptions, both of which are long overdue. Concerted efforts are also underway to create a common, national structure for communication between patients and providers over the internet. Current developments are paving the way for more profound steps. A standardized, universally adopted electronic patient record infrastructure can quickly add value to the current system. Such a system will require detailed standards for data deﬁnitions, architecture for combining data and communication protocols, and eventually templates for individual medical conditions to foster clinical effectiveness. It will be a strategic imperative to organize this ICT infrastructure in a way that supports the efﬁcient management of patient health outcomes and costs. All data collection should be designed to support the care pathway of an individual patient and to automatically extract essential case-mix (including disease severity and co-morbidities) and outcome data to enable value measurement. Furthermore, data architecture should support the analysis of full care cycles, irrespective of the actual units providing care. In many industries, the introduction and development of ICT has spurred the creation of entirely new products and services. To date, the applications of ICT in health care have mainly involved automating some discrete, existing services or moving them online, e.g. making general medical information accessible to patients, scheduling appointments, transferring self-measured data on blood glucose levels, etc. However, internet applications enabling physicians and patients to improve care together are still lacking. In the realm

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of care for chronic conditions alone, ICT provides enormous potential to improve care monitoring, patient coaching, and self-management. While Finland has begun to take some meaningful steps towards standardizing health care ICT to enable value improvement, current policy measures and levels of investment are inadequate. National political decision makers should commit to an ambitious plan for rapid ICT standardization and development to be used as the basis for the phased-in, universal adoption by providers and municipalities and accompanied by increased public funding. Through major additional, nationally coordinated investment in health care ICT, Finland can quickly reach the global forefront of health care ICT implementation. Today, national responsibility for the implementation of ICT policies is divided among many actors, each of whom has allocated limited resources toward the work. A common, concerted effort, including financial contributions, will be required of all bodies involved in the future. However, MSAH should further strengthen its own capacity to ensure that national ICT policies and standards are defined in a concrete and sufficiently detailed manner.

Increase the role of patients in health care One of the vices common to all advanced economy health care systems is the tendency to patronize patients. The uneven power dynamic created by clinicians’ medical knowledge coupled with the often vulnerable position of patients can lead to one-sided, provider-controlled treatment and communication. Patients may also believe, sometimes correctly, that providers’ decisions are being made in part based on short-term cost considerations rather than on long-term health outcomes. As a result, patients may be sceptical of providers’ advice, while poor communication can mean that patients’ needs and preferences are often not taken fully into account. Among the compelling reasons to challenge this dynamic is the belief that patients have a basic human right to control their body and health. It is also legitimate for taxpayers to demand to be considered as subjects rather than as objects within a health care system that is largely publicly funded. There are also strong links between value and the active participation of patients in their health and health care. As such, patients are truly co-producers of care; patients with especially chronic conditions are often the best “experts” on their disease and its impact on their health and ability to function. Moreover, the outcomes of many primary and secondary prevention efforts largely depend upon individual adherence to certain behaviour or treatment plans.

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But, some argue against increasing the role of patients by stating that empowered patients will demand more care. However, there are studies (e.g., Vuorma et al. 2003) that support the opposite conclusion - that well-informed patients tend to favour more conservative, and often less costly, treatment options than the treatment plans recommended by their physicians. Both patients and professionals should join forces to create a new culture that places value for each individual patient at the centre. The clinician’s role is to work with the patient to ﬁnd a care plan that best corresponds to the patient’s medical needs and personal preferences. By recognizing patients as sources of indispensable information about their own health and treatment options, individual providers and care delivery systems can create value while improving patient comfort and satisfaction with their health and health care. For patients with chronic conditions, clinicians must often serve as coaches that provide information and support for patients in their pursuit of the highest achievable health status. But coaches cannot succeed without their teams, and understanding patients’ priorities, goals, and potential limitations to adherence are critical to the results of care. One of the major obstacles for patient involvement is the current fragmented approach to care delivery. Often, there is no team to take responsibility for education and continued support. By encouraging team-based care, integrated practice units will provide structures to promote and maintain patient engagement. As discussed above, the role of patients must include the freedom to choose the providers best able to meet their needs. Finland remains among the western European countries with the least freedom to select providers, but change may be soon to come with the planned 2011 introduction of the new Health Care Act. Two caveats must be borne in mind when expanding patients’ choice of providers. First, the freedom to choose a provider will only produce better value if decisions are based on relevant and reliable results. Otherwise, patients may end up amid a morass of “image” marketing, as has occurred in the United States and elsewhere. Patients must be supported by their primary care and other referring clinicians, as well as by municipalities, in ﬁnding services that correspond to their medical needs and personal preferences. Second, mechanisms must be in place to secure the rights of those who do not have the capacity to actively participate in their own care choices. The elderly, children and those with cognitive limitations must not be left to use second-rate services.

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Moving to action In recent years, Finnish health care has developed rapidly, with many population indicators placing Finland among the world’s top health care systems. However, these successes should not be used as excuses to neglect further development. Trends including an aging population, advances in medical science and increasing expectations make improvement an imperative. This report applies a value-based framework of health care delivery in order to provide a holistic view of the current state of Finnish health care. The aim is not to detail the problems of current health care programmes or care processes but to return to the fundamental principles of health care delivery. The most crucial questions for the future of Finland’s health care system are those dealing with achieving optimal health outcomes for the Finnish people in a ﬁnancially and socially sustainable way. These are also the central themes of value-based health care delivery principles. One of the crucial issues in Finnish health policy is to achieve equitable access to health care services. We believe that equitable access to services must remain the fundamental principle guiding the development of the health system, and the value-based framework will allow Finland to take equity principles to a new level. By creating dynamics with no incentives for shifting costs, many obstacles to equitable access are removed. By ensuring strong incentives for result-driven care delivery, resources will be used more effectively for all citizens, which is a prerequisite for achieving the capacity to provide the necessary services for all. As providers strive to measure and improve value, equity will also come to encompass not only the right to access care but also the right to better health. This report is not a detailed prescription for immediate policy decisions, and it leaves much room for further discussion and elaboration. We believe that this is the right time to shift the discourse on health care in Finland toward the long overlooked but core idea of value. The ensuing discourse should be oriented towards action and work to identify concrete policy goals, to deﬁne a logical sequence of policy steps and ultimately, to implement those steps in an effort to achieve a truly value-based health care system in Finland.

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Sitra, the Finnish Innovation Fund is an independent public fund that promotes broad innovative changes in society in order to foster the success of Finland and ensure the wellbeing of its citizens.

The Finnish Health Care System: A Value-Based Perspective

The Finnish Health Care System: A Value-Based Perspective Juha Teperi, Michael E. Porter, Lauri Vuorenkoski and Jennifer F. Baron

Sitra Reports

the Finnish Innovation Fund

ISBN 978-951-563-659-1 ISSN 1457-5728

Itämerentori 2, P.O. Box 160, FI-00181 Helsinki, Finland, www.sitra.ﬁ Telephone +358 9 618 991, fax +358 9 645 072

Sitra Reports