European experience on the right form of provider governance in health care; the Spanish case
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1 LSE Health and the NHS Confederation's Health Services Research Network and NHS European Office seminars, 7 June 2012 European experience on the right form of provider governance in health care; the Spanish case Dr. Antonio Durán, Director, Técnicas de Salud Consulting
2 4 main topics in my presentation (from our book Governing Public Hospitals ): - Effective hospital governance: challenges - Developments in governance from Spain - Effect on outcomes and functioning - Future roles of public hospital governance
3 Is the belief that quality, innovation and productivity depend on granting a hospital or provider organisation the ability to make its own strategic, financial or clinical decisions supported by evidence? - Can the experience from hospital governance reforms in Spain be applied in England?
4 Governance: conceptual dimensions - Understanding the new developments in state-society relationships - Perceiving the processes of steering, coordination and goal-setting through which society is governed nowadays - Discovering the mixed systems (markets, hierarchies, networks and communities involved in (public) services delivery. Richards D and Smith MJ (2002) Governance and Public Policy in the UK, Oxford: Oxford University Press, p.2
5 Understanding provider governance in health care Governance Politics Management Administration Operations
6 Hospital Governance: definition A set of processes and tools related to decision making in steering the totality of institutional activity, influencing most major aspects of organizational behavior and recognizing the complex relationships between multiple stakeholders. Scope: from normative values (equity, ethics) to access, quality, patient responsiveness, and patient safety dimensions + political, financial, managerial as well as daily operational issues. Saltman RB, Durán A and Dubois HFW (eds.) (2011) Governing Public Hospitals, Reform strategies and the movement towards institutional autonomy, London: WHO on behalf of the European Observatory on Health Systems and Policies, p.38
7 A widespread phenomenon Country Czech Republic Estonia Israel Netherlands Self-governing models Joint Stock Companies Public Contributory Organizations Limited Liability Companies Joint Stock Companies Foundations Private non-for-profit Government Owned Sick Fund owned Private, Sick Fund Major Shareholder Non-for-profit Private Foundations Country Norway Portugal Spain England Self-governing models Regional Health Enterprises Public Enterprise Entity Hospitals EPE Public Health care Companies Empresa Pública Sanitaria Fundación Pública Sanitaria Fundación Consorcio Concesión Administrativa NHS Trust Foundation Trust Saltman RB, Durán A and Dubois HFW (eds.) (2011) Governing Public Hospitals, Reform strategies and the movement towards institutional autonomy, London: WHO on behalf of the European Observatory on Health Systems and Policies
8 Keeping political interference at bay Founders/Owners: set up, close, join, and split the hospital + appoint Supervisory Council; Supervisory Board: nominate Managing Board +approve plans, budgets, investment & structure + oversee activities + sale land & buildings. Management Board: suggest to Superv. Board + nominate unit managers + set day-to-day rules + decide use of buildings + lead projects. Unit managers: ensure everyday activities + make investment & development proposals + follow rules on use of resources + report
9 Serious challenges! Citizens and users Politicians Competing providers Media Staff Patient demands Cost pressures Demographic etc. pressures Local authorities Industry Technology Autonomy Legitimacy/ Status Financing Accountability Decision Capacity Improved Performance
10 European Continuum of Hospital Governance Strategies Command And Control Restricted Semi- Autonomy Considerable Semi- Autonomy Maximal Semi- Autonomy Fully Independent Private Norway Portugal Israel Estonia Czech Republic England Spain Netherlands Saltman R, Durán A and Dubois HFW (eds.) Governing Public Hospitals. Reform strategies and the movement towards institutional autonomy, Copenhagen: WHO on behalf of the European Observatory on Health Systems and Policies, p 77
11 Hospital autonomy and self-governance, Spain Public command & control model Public Healthcare Company Public Healthcare Foundation Foundation Consortium Administrative Concession Fully private hospital model
12 Public Health Enterprise - In Andalucía: Costa del Sol Marbella, Poniente, Alto Guadalquivir and Empresa de Emergencias Sanitarias; in Madrid: Fuenlabrada. Public Health Foundation -In Asturias: Oriente Grande Covián ; in Baleares: Inca. Gone! Foundation - In Madrid: Alcorcón; in Baleares: Manacor; in Galicia: Barbanza, Virxe da Xunqueira, Verín and Salnés (status abolished July 2008) Consortium - In Cataluña: Maresme, Integral de Cataluña, Vic and Tarrasa; in Sevilla: Aljarafe -San Juan de Dios. Administrative Concession - In Valencia: Ribera Hospital in Alzira, Torrevieja; Marina Alta in Denia and Manises; in Madrid: Infanta Elena in Valdemoro.
13 Status/ Recognition Spain 2011: Hospital autonomy and self-governance Public Healthcare Company Regional law. Portfolio by regional department Stakeholders: nonstatutory staff. Foundation Consortium Administrative Concession Secondary legislation Some decisions on services portfolio. Stakeholders: non statutory staff. Agreements with non profit org. Decide on portfolio Stakeholders: nonstatutory staff Contract with private company. Decide on portfolio. Non-statutory and statutory staff Financing Capital investment under public procurement law. Budget. Unable to retain surpluses. Accountability Board chaired by regional minister No patient involvement or reporting obligations. Free to invest. High volume contracts, procurement law. Cash flow and pay providers. May retain surpluses for reinvestment. Board chaired by regional minister. No patient involvement. Accounts registered annually. Free to invest. High volume contracts, procurement law. Activity& capitation Payment/ cashflow + pay providers. Reinvest surpluses. Supervisory Board of participating organisations. Local people in the Board. Annual report. Free on sources of capital. Not subject to procurement law. Capitation. Can retain surpluses but annual profit capped. Joint Committee and Commissioner. No patient involvement as such. Annual report. Decision Capacity Vs Responsibility High interference. Some freedom for clinical managers. Free internal monitoring. High interference. Some freedom for clinical managers. Free internal monitoring. Low interference. Some freedom for clinical managers. Free internal monitoring. Low interference. Some freedom for clinical managers. Free internal monitoring. Alvarez A and Duran A, Spain, in Saltman RB, Durán A & Dubois HFW (eds.), 2011 Governing Public Hospitals, Reform strategies and the movement towards institutional autonomy, London: WHO on behalf of the European Observatory on Health Systems and Policies, p
14 A glimpse on PPP (Vs outright privatisation!) UK Private Finance Initiative & most Spanish cases (Son Dureta, Aranjuez, etc.): only hospital buildings and their life-cycle maintenance plus limited range of other services Portugal: a medical services company contractuallylinked to the PFI contractor. Finland & Germany: entire hospitals/ hospital groups franchised to private companies, with tariff arrangements and restrictions on patient cream-skimming Only Alzira plus (Torrevieja, Denia, Manises, Elche, etc) have franchised full PHC &secondary healthcare provision (in addition, with capitation rather than service funding).
15 A key feature: mostly not earmarked budget transfers National Government + 2-Chamber Parliament 17 Autonomous Communities 2 Autonomous Cities Regions spend 89.81% Central administration 3%; Municipalities 1.25% Parliaments elected by direct vote Regional Governments Regional Ministries of Health coordinated by the Ministry of Health and Social Policy
16 Spain - 4th in the world in life expectancy at birth (3rd for females); - 4th in life expectancy at age 65; - Under average in EU infant mortality (6th in average annual rate of decline since the 1970); - Among the lowest, and in steady decrease, in mortality for top causes since 1970 in Europe (CV diseases, cancer and respiratory diseases). National Institute of Statistics. Consulted May, 2010; The Economist Intelligence Unit, March 2010, Spain Country Report p.17http://
17 Selected cancers. Five-year relative survival rates EUROCARE 42 EUROCARE 42 EUROCARE Breast (women) France 80.9% 82.7% N/A Germany 75.8% 78.3% 78.7% Italy 79.7% 83.7% 83.7% Spain 76.2% 80.8% 82.8% UK (England) 72.4% 77.6% 77.8% Colorectal France 56.7% 57.5% 60.3% Germany 52.4% 57.5% 61.4% Italy 51.9% 57.4% 59.5% Spain 50.5% 52.5% 61.5% UK (England) 45.9% 50.8% 51.8% Lung France 14.0% 12.8% N/A Germany 11.7% 13.2% 14.1% Italy 10.8% 12.8% 13.3% Spain 11.4% 10.8% 12.2% UK (England) 7.9% 8.6% 8.4% Source: KantarHealth (2010) Oncology Market Access. Europe. Data taken from the EUROCARE-4 study.
18 But also (i) Geographical differences -in health outcomes (3 years of LEB) & financing (variation of 40.7% around the average in public expenses per person in 2010); (ii) Large variability in access, quality, safety and efficiency all over; (iii) Sustainability concerns (capital expenditure growth >130%!)
19 Public per capita budget and political sign of the Regional Government 2010 Progressive Public healthcare budget per capita > average national public healthcare budget of1343 Euros Public healthcare budget per capita < average national public healthcare budget of1343 Euros Conservative Nationalist Federación de Asociaciones para la Defensa de la Sanidad Pública (FADSP), En Diferencias notorias en el presupuesto per cápita entre CC.AA., según un estudio de la FADSP, Anónimo, Enero 2009
20 Respondents who believe that same health services are offered to all citizens despite 100,0 90, Percentage 80,0 70,0 60,0 50,0 40, , ,0 10,0 0,0 Autonomous Community of residence Patient's gender Patient's social class and wealth Agencia de Calidad del SNS. Instituto de Información Sanitaria, 2010, Barómetro Sanitario 2009.
21 Unwarranted variability across regions (1 of 2) 5-time variations in use of percutaneous transluminal coronary angioplasty PTCA between areas; 2-fold variation in mortality after PTCA (hospitals) 7.7-time variability in prostatectomy rates across health care areas Caesarean sections increasing unwarrantedly; variability among hospitals declining due to the convergence of all providers towards high rates. 2.2 to 4.5 times higher fatality rates low-mortality DRGs, decubitus ulcer, catheter-related infection, pulmonary thromboembolism and deep-venous thrombosis after surgery or post-operative sepsis across health care areas. García S, Abadía B, Durán A and Bernal E, 2010, Spain: Health system review. Health Systems in Transition, 12 (4): 1 290
22 Unwarranted variability across regions (2 of 2) 28 times more frequent admissions to acute care hospitals due to affective psychosis among areas 26% of hospitals with more than 501 and less than 1000 beds, at least 15% more inefficient than the standard; 12% of hospitals with more than 201 beds and less than 500 were, at least, 25% less efficient than the standard for treating similar patients García S, Abadía B, Durán A and Bernal E, 2010, Spain: Health system review. Health Systems in Transition, 12 (4): 1 290
23 per capita expenditure variation coefficient among Regions Variability not explained by changes in protected population García S, Abadía B, Durán A and Bernal E, 2010, Spain: Health system review. Health Systems in Transition, 12 (4): 1 290
24 Spain, beds in acute care hospitals, psychiatric hospitals and long term institutions, (a) Acute care hospital beds per Psychiatric hospital beds per Nursing & elderly home beds/ European Observatory on Health Policies and Systems, 2006, Hit, Spain. For , WHO/EURO HFADB Spanish National Hospitals Catalogue (Ministerio de Sanidad y Consumo, 2004a). Hospitals National Catalogue,
25 Spain, Hospitals and hospitals beds, Hospitals Beds Hospitals Beds Estadística de Establecimientos Sanitarios con Régimen de Internado. Información Anual de 1997 a Catálogo Nacional de Hospitales. Años 2004 a Both accessed May 2012
26 1977/81 Creation of MoH (Health& Social Security: Consumer Affairs) 1986 General Health Law 1991 Comisión Abril for the Analysis and Evaluation of the NHS 1992 Law on Consortia 1993 Creation of Public Enterprise Hospital Costa del Sol in Marbella 1994 Law on Foundations and Fiscal Incentives to Private Participation in Activities of General Interest 1996 Royal Decree on New Management Modalities in the INSALUD 1997 Law on New NHSManagement Modalities. Fails a Parliamentary Agreement for Reforming and Modernizing the NHS 1998 Creation of Public Health Foundations. Fiscal, Administrative and Social Measures in the Addendum to the Budget Law Valencia uses Law 15/1997 to create Administrative Concesions 2000 Royal Decree on New Modalities: Self-governance models, Public Health Foundations, Consortiums and Foundations 2002 Abolition of INSALUD. Updating of Law on Foundations 2007 Law on Public Sector Contracts reduce autonomy of schemes
27 Obvious lack of interest in global reviews not a single robust technical evaluation! Despite serious financial investments health information system in Spain too much based on resources/activity data (to the detriment of outcomes) Very limited connectivity between Regions and across the country; no systematic performance assessment
28 Valencia. Does the hospital legal form have any major influence on efficiency? Cost per inhabitant (wider region of Valencia) Annual fee paid to the contractor per inhabitant Difference 25% 27% 27% 26% 26% Capitation costs in Administrative Concession model, lower than in the rest of the system. NHS European Office, The search for low-cost integrated healthcare. The Alzira model.
29 Andalucía. Financing indicators for a Traditional Hospital and a Public Healthcare Company. TPH PHC (1)/(2) Total expenditure (per covered inhabitant) Total expenditure (per discharge) 7,658 6, Total expenditure (per DRG point) 4,799 4, Operational costs (per covered inhabitant) Operational costs (per discharge) 7,364 5, Operational costs (per DRG point) 4,614 4,145 1,11 Análisis comparativo de la actividad realizada por dos hospitales del sistema sanitario público de Andalucía: Hospital Virgen de Valme y Hospital Costa del Sol. Cámara de Cuentas. 2008
30 Andalucía. Traditional Public Hospital and Public Healthcare Company. Structural profiles TPH PHC 349,376 Covered population 372, Number of beds 348 2,481 Total Staff 1, High managerial staff Intermediate managerial staff % Absenteeism 4.6% Análisis comparativo de la actividad realizada por dos hospitales del sistema sanitario público de Andalucía: Hospital Virgen de Valme y Hospital Costa del Sol. Cámara de Cuentas. 2008
31 Andalucía. Surgical activity for a Traditional Hospital and a Public Healthcare Company. TPH PHC 1.03 Average preoperative length of stay ,630 Programmed interventions 11,890 4,857 Inpatient interventions 3,983 5,486 Major ambulatory surgery 4,787 5,287 Minor ambulatory surgery 3,120 4,308 Urgent interventions 2, % Nosocomial infections prevalence 5.7% Análisis comparativo de la actividad realizada por dos hospitales del sistema sanitario público de Andalucía: Hospital Virgen de Valme y Hospital Costa del Sol. Cámara de Cuentas. 2008
32 Does the hospital legal form have any major influence on performance? Handling of Acute Myocardial Infarction, Breast Cancer and Chronic Obstructive Pulmonary Disease analyzed in hospitals with different legal forms) TPH 210, PHC F C AC Covered population 297, , , ,135 Beds/1000 population Length of stay (LOS) Occupancy rate H/day of operating rooms use No. of surgical interventions No overwhelming superiority of any legal form; only specific advantages and disadvantages Coduras A et al., Gestión de tres procesos asistenciales según persona jurídica hospitalaria. SEDISA, 2008
33 Valencia activity results; Traditional Hospitals vs. Administrative Concession model Traditional AC model 51 days External consultation delay 25 days days Average surgery delay 34 days 7.2 Patient s satisfaction (0 to 10) % Major day surgery 56% 52% Outpatient surgery rate 79% > 2 hours Emergency waiting time < 1 hour NHS European Office, The search for low-cost integrated healthcare. The Alzira model.
34 Galicia. Do Foundations cause access inequity by generating longer waiting lists / spending less per person/ offering fewer services? Traditional public hospitals Foundations Av. Max Min Av. Max Min Beds (by 1000 population) Length of stay Occupancy rate ,976 13,402 2,398 N. of surgical interventions 4,312 11,124 1,563 1,016 1, Surg. Interv./room / year 963 1, yet activity levels are very similar Martín-García M, Sánchez-Bayle M, Nuevas formas de gestión y su impacto en las desigualdades. Gac Sanit 2004;18(Supl 1):96-101
35 Anti-crisis policy measures in health: Earmarked taxes for health ( fuel consumption ) in Andalucía, Cantabria, Cataluña, Murcia Almost exclusively targeted at drug expenditure (use of generic drugs, price cuts, tougher deals with industry, restrictions to new treatments and drugs into market). At first, slower infrastructure development plus staff salary and budget cuts -increased waiting lists, etc but no cost-containment measures directly restricting access to care services or treatments.
36 Except Cataluña; as of November 2011: 1 co-payment for each prescription (max. 63/year); people on benefits and drugs priced< 1.67 exempted; High-complexity tertiary care concentrated (the 1,500 oncology surgery cases/year) provided in 21 hospitals will only be done in 7 tertiary care in Barcelona area) Plus tax increases on transport, water, petrol and university fees; public service salaries reduced, etc.
37 Prime Minister Rajoy... the reformer? Frantic process of weekly policy reforms. Key areas: - Budget Stability Law (expenditure and budget ceilings to national, regional and local government spending); - Loans to ensure payment of outstanding local and regional authorities debt to private providers; - Labor market reform (top lay-off payments down from 42 to 12 months pay; flexible collective-bargaining); - Banking Sector reform (mergers; increased bank funds threshold, nationalization of the matrix of Bankia); but no reform of Public Administrations as yet
38 Spain, staff working for the State by public administration category, Staff from autonomic/ regional or municipal public companies are not included Fuentes: Mayo 2012
39 Civil servants working for Autonomous Regions in Spain, Staff from autonomic/ regional or municipal public companies are not included Fuentes: Mayo 2012
40 April 2012: Fiscal debt in 2011 discovered to have been 8.51% of GDP (Vs 3% requested or 6% declared by previous government/ accepted by the EU). Further cut of 10bn, some 7bn in health (Royal Decree Law 16/2012 of Urgent Measures to guarantee the Sustainability of the SNS).
41 Moving agenda? Concessions likely to expand... but plenty of confusion! Valencia: announced will apply administrative concession model to all general services of public hospitals (note that nationalized Bankia is now a shareholder of private Ribera Salud!) Madrid: 2 hospitals already operating as concessions and 2 more to come Castilla-la-Mancha: 4 public hospitals to be converted into administrative concessions
42 Hospital Governance framework Attributes Before New Emphasis Status Political dependence Autonomy Organization Self-sufficient Networks &Partnerships Workforce Corporatist; tradeunions influence Civil service Various status Governing style Command and Steering control Goal Effectiveness and quality of services Responsiveness (to users) Accountability Upwards Multiple; ethics & standards of conduct Context Isolation Coordination & public leadership Technology Information Intelligence Boundaries Facility-based Flexible boundaries
43 Public hospital governance; future role Health system reforms have generally fallen short of both rhetoric and expectations. Their limited impact stems in part from their limited effects on clinical practice. Policies introduced by health care reformers need to compete with the many factors that influence decisions by health professionals and patients. Oxman AD, Bjørndal A, Flottorp SA, Lewin S, Lindahl AK, 2008, Integrated Health Care for People with Chronic Condition, A Policy Brief, Norwegian Knowledge Centre for the Health Services, Oslo
44 Public and private agencies confronted by policy difficulties tend to move the deck chairs on the Titanic by re-disorganizing the health care delivery structures. Implicit in this response is the usually evidence-free belief that changes in structure will somehow improve in some implicit way both processes and outcomes. This optimism is usually unjustified. Maynard A, 2008, Payment for Performance (P4P): International experience and a cautionary proposal for Estonia, Health Financing Policy Paper, Regional Office for Europe, p.4
45 Muchas gracias
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