Unknown costs of new health care reforms

Five steps – and not one more – is supposedly all the Minister of Health needs to reform the health care system. The problem is he presented no details, only catchy slogans. No costs of the reform were mentioned. The one thing we know for sure is that the government plans to spend PLN 100 million a year for subsidising in vitro procedures.

The end of the year may bring about a considerable number of surprises in health care. Bartosz Arłukowicz, Minister of Health, is to present premises that would allow taking the first step towards decentralisation of the National Health Fund (Polish: NFZ). Sławomir Neuman, Deputy Minister of Health, declared that the draft act would be submitted to the Sejm at the beginning of 2013 and adopted in spring. The plan is to introduce the changes, i.e. first to liquidate the Fund headquarters, at the end of July and the beginning of August 2013.

Costs of changes – unknown

The change consists in closing down two institutions: the Agency for Health Technology Assessment in Poland (Polish: AOTM) and the Centre for Development of Quality and Safety in Health Systems (Polish: CMJOZ). The Agency’s tasks include issuing opinions on services and recommending them to the Minister in order to cover them with financing by the National Health Fund. The Centre grants accreditations and quality certificates to health care establishments, and supervises compliance.

‘In lieu of the two institutions, we will set up an independent modern agency whose task will be to supervise spending, quality, and independent valuation of procedures’, declared Bartosz Arłukowicz, Minister of Health.

Other details have not been revealed yet. Although the Ministry has been working on the decentralisation of the National Health Fund for at least a year now, we do not know the cost of the project, i.e. the cost of terminating the operations of the National Health Fund, the Agency for Health Technology Assessment in Poland or the Centre for Development of Quality and Safety in Health Systems, or what amount would have to be spent on establishing the new institution that would i.a. value services.

The Ministry did not reveal the details to associations of medical establishments or independent experts either. The opposition has raised alarm that no funds for such measures have been earmarked in the next year’s budget. We only know the Agency for Health Technology Assessment in Poland’s 2012 budget: this year, it received slightly above PLN 7.3 million . Next year, the planned budget subsidy will amount to PLN 6 million. It can be safely assumed that the operating costs of the new institution, which will value services and procedures, will be comparable (at least in the beginning).

Cheap headquarters

It is a pity that the government would not present the costs of the measures it plans to undertake, especially as the National Health Fund is one of the institutions that manage significant amounts of money. Its annual revenues are PLN 64.3 billion. Next year, the amount will be PLN 66.4 billion, of which PLN 62.9 billion will be spent on medical services. Compared to such institutions in other EU countries, the Fund’s operating costs are relatively low. This year, the Fund spent PLN 663.5 million on administrative costs, and next year it plans to spend PLN 682.5 million, or slightly more than 1% of its revenues.

This year, administrative costs of the Fund’s headquarters amounted to PLN 117 million. The money was used to pay e.g. taxes, insurance and employee salaries. The operating costs of German health insurance funds are much higher. It is estimated that they consume even up to 10% of total outlays. We have no way of knowing if the institution set up in lieu of the Fund headquarters would be less expensive.

Make way for an e-card

It is also a problem to estimate the costs of introducing another element of the reform, namely the electronic health insurance card. Michał Boni, Minister of Administration and Digitization, declared only that the cards would be used from 1 January 2014.

The Ministry plans to issue personalised chip cards to all citizens. At the same time, also medical specialists’ cards are to be issued to doctors to provide access to patients’ medical records. Minister Boni says that the card could potentially be used as an electronic ID.

How much would it cost to issue such cards to over 37 million Poles? No such data are available. Experts have no clue either. The only figures one could possibly use were given during the work on the act on the information system in health care. The act requires the government to introduce the e-card. The funds for setting up the IT system are to be provided by the European Union.

A total of PLN 700 million are to be earmarked for measures related to introducing IT to the health care sector. The estimates made in 2010, when the government advocated the idea that the card would also work as an ID and store medical records, say that the project would cost PLN 370 million.

The Minister of Administration and Digitization emphasised that the electronic health insurance card and the medical specialist’s card would allow accessing patients’ medical records via a special terminal. Minister Boni added that the card would be a part of the ‘Medical Services Register 2’ (Polish: RUM II) under which all patients would have access to the records of the medical services they have been provided.

The cost of launching the new system is PLN 400 million. The government counts, however, on significant savings thanks to the introduction of e-cards and RUM II. First of all, it would be easier to detect a number of irregularities, such as prescribing reimbursed medicines to people who actually do not exist. It would also be easier to control the expenditure of medical establishments. The estimates reach billions – thanks to making the system more stringent, savings could total even PLN 3-4 billion. More specific data are not available.

Unsure insurance

It is also a problem to determine the benefits of introducing the final step of the system’s reform, namely additional health care insurance. Even the Ministry of Health finds it difficult to answer the question on the actual amount of money Poles spend on treatment in private health care centres. Sometimes it is said to be PLN 20 billion, sometimes as much as PLN 30 billion.

Data of subscription companies show that the value of the health care packages market exceeds PLN 2 billion. Poles spend about PLN 200 million a year on additional health care insurance (for offers currently available on the market). The Polish Insurance Association (Polish: PIU) estimates that the State saves about PLN 750 million a year on patients who prefer to use private health care. Dziennik Gazeta Prawna daily stated that in the first half of 2012 the number of private doctor’s appointments increased by 30% compared to 2011.

The Ministry’s estimates from 2011 said that additional health insurance would be (ultimately) purchased by about 10% of the insured. Yet, it is uncertain whether the estimates are still valid as the Ministry’s most recent draft act on additional health insurance was presented in August 2011. It also lacked a forecast on its financial effects.

PLN 100 million for in vitro

The solution whose costs have already been estimated by the Ministry of Health is the introduction of in vitro procedure reimbursement. The programme’s annual cost would be PLN 100 million. As the programme is to be launched in mid-2013, it will cost PLN 50 million. Over the next three years, there will be enough money to subsidise three IVF attempts for 15,000 couples. Only the procedure will be reimbursed, while the costs of the medicines taken before and after the procedure are paid by the parents-to-be.

The funds for the reimbursements will be derived from a dedicated reserve of the Minister of Health.

‘In 2012, the reserve amounts to PLN 400 million. About PLN 240 million from the pool have already been shifted to a number of health care programmes this year’, said Bartosz Arłukowicz.

Summing up, many questions on the costs of the changes planned in the health care system remain unanswered. It is particularly disturbing that there is no information on expected spending and possible benefits of the planned reform. As a rule, reforms are introduced to improve the efficiency of spending public funds and to enhance the quality of services.

The quality of services is a different matter altogether. As to efficiency, it is difficult to evaluate lacking the knowledge of possible costs. Knowledge is all the more important that our experience with reforms introduced by the Ministry of Health is not positive. Many changes introduced in the past turned out defective from the legislative point of view and incurred additional costs. It would be better to avoid it by calculating the costs of reforms prior to their introduction.

The author is a journalist working for the Dziennik Gazeta Prawna newspaper.



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