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Abstract
This research contribution presents a diagnosis of the health reform experience of six small and mid-sized industrial democracies: Chile, Israel, Singapore, Switzerland, Taiwan and The Netherlands during the last decades of the twentieth century. It addresses the following questions: why have these six countries, facing similar pressures to reform their health care systems, with similar options for government action, chosen very different pathways to restructure their health care? What did they do? And what happened after the implementation of those reforms? The article describes the current arrangements for funding, contracting and payment, ownership and administration (or “governance”) of health care at the beginning of the twenty-first century, the origins of the health care reforms, the discussion and choice of policy options, processes of implementation and “after reform adjustments”. The article looks at factors that help explain the variety in reform paths, such as national politics, dominant cultural orientations and the positions of major stakeholders.
Acknowledgements
This study has its roots in a meeting of the German Bertelsmann Foundation in Helsinki in 2006, attended by four of the authors of this article. Over dinner, they agreed to join forces in an effort to describe and analyze the health reform experience of their countries in a separate publication. The authors are grateful to the Bertelsmann foundation for the opportunity to meet and discuss their project.
This contribution is the result of an international collaborative effort. The authors share the introduction and general conclusions, but the country experts wrote the country pictures. Thus Kieke Okma and Hans Maarse wrote the section on Dutch health reform, Tsung-Mei Cheng on Taiwan, David Chinitz on Israel, Luca Crivelli on Switzerland, Meng-Kin Lim on Singapore and Maria Eliana Labra on Chile.
Notes
1. One important methodological issue is the need to carefully define terms and concepts. That seems to be a superfluous and self-evident remark, but many policy debates (and studies) are clouded by fuzzy terms. For example, in the last decades the term “health care reform” has appeared in numerous articles, journals, papers, books, conferences and academic meetings. However, few if any clearly define the term “reform” (Okma 1999, Marmor and Okma 2003). Many comparative studies aim to analyze processes of health reform across the globe, but few pay attention to what it is, conceptually, they seek to explain.
2. “Governance”, another example of a conceptually fuzzy term, is a rising star in the terminology of today. Basically, the term refers to the administration of health insurance and health care. Interestingly, it has traveled from government to the corporate sector and back again to the public sector (Okma Citation2002: notes 14 and 18). During this journey, it also shed its neutral meaning and took on a normative connotation under the label of “good governance”. In this contribution, we take “governance” in a neutral sense: administration (both public and private) of health services and health insurance. We characterize governance styles by looking at the “dominant cultural orientation” and dominant welfare orientations that affect the style of social policy making in each country.
3. One question we have not addressed extensively in this paper is what counts as a “small” or “medium” country. Most international comparative studies take one or more of the world's large countries as the main comparator: the US, the UK, Canada, Germany, France and sometimes other large OECD member states. We use the term “small and medium sized” to indicate countries that clearly do not belong that group. In the introduction to his grand oeuvre Rich Democracies, Harold Wilensky addresses the issue of the size of countries. He argues that rather than actual size in terms of population or geography, it is the complexity of administration that matters (Wilensky Citation2002).
4. Qualitative research by Chinitz (Citation1999) indicates that Israeli physicians spend up to 10 per cent of their time engaged in quarrels with sick fund managers over these points. The physicians often win the argument, but the organizational consequences in terms of efficiency and morale are significant.
5. For an updated general presentation of the Swiss health care system see OECD (Citation2006).
6. It is important to note that until the Revised Health Insurance Law of 1996, health insurance was optional at the federal level. Before 1994, four cantons had made affiliation to a health plan mandatory for the entire population, and eight cantons for special population groups like low-income families or foreigners.
7. As they are private (and governed by private law), the supplemental insurances face less government control than the basic coverage. Insurers can impose more restrictions. In practice, however, most people do not clearly distinguish between the two and the supplemental coverage may influence the choice of basic plan.
8. Those low overhead costs compare to other programs run by government, for example the Medicare or Veterans' health Services in the US. Those expenses are generally much higher for private health administration – some studies even suggest that those overheads cause 24 per cent of total health spending in the US (Woolhandler et al.2003).
9. Until 2006, eligibility for social health insurance was limited to about 60 per cent of the Dutch population; almost all of the remaining 40 per cent of population insured with either work-related group insurance or individual health insurance.
10. There is some dispute over the question whether it should be labeled public or private – that question has not yet been tested by the European Court of Justice, the only authority that can decide on the matter.
11. Interestingly, for this purpose, over 40 per cent of the Dutch population qualifies as “low income”. In 2005, the Tax Department hired over 600 extra staff to administer the subsidies, including a monthly income check of all applicants. In 2007, the Health Ministry announced plans to simplify that administration.
12. Since national competition law based on European law prohibits market collusion, Dutch health care providers have had to abandon their long tradition of collective bargaining between national associations of insurers and providers over fees and tariffs (in Germany, that traditional neo-corporatist model is still in place). Nowadays, hospitals, general practitioners and other independent providers have to sit down and negotiate individually with all the health insurance they seek contracts with; and health insurers no longer have to contract with every provider.
13. Actually, it is more correct to say that the reforms increased choice of health insurer and decreased choice of provider; selective contracting means that not all providers will get contracts, and some patients thus face a restricted choice.
14. Paradoxically, the introduction of market competition has in some cases actually reduced patients' choice of provider. For example, after the abolishment of mandatory contracting in the Dutch sick fund system in 1991, the funds no longer had to contract all independent health professionals. Thus, while the Dutch citizens have more choice of health insurer, their choice of provider may be curtailed because of selective contracting by their health insurer.
15. As we have observed elsewhere, values can direct policy making in a certain direction, or exclude certain options, but they do not tell policymakers exactly what to do (Marmor et al. Citation2006).