Achim Schmid

Five types of OECD healthcare systems: Empirical results of a deductive classification

This article classifies 30 OECD healthcare systems according to a deductively generated typology by Rothgang and Wendt [1]. This typology distinguishes three core dimensions of the healthcare system: regulation, financing, and service provision, and three types of actors: state, societal, and private actors. We argue that there is a hierarchical relationship between the three dimensions, led by regulation, followed by financing and finally service provision, where the superior dimension restricts the nature of the subordinate dimensions. This hierarchy rule limits the number of theoretically plausible types to ten. To test our argument, we classify 30 OECD healthcare systems, mainly using OECD Health Data and WHO country reports. The classification results in five system types: the National Health Service, the National Health Insurance, the Social Health Insurance, the Etatist Social Health Insurance, and the Private Health System. All five types belong to the group of healthcare system types considered theoretically plausible. Merely Slovenia does not comply with our assumption of a hierarchy among dimensions and typical actors due to its singular transformation history.

Cross-National Policy Learning in Health System Reform: The Case of Diagnosis Related Groups

Observations of policy convergence and the cross-national diffusion of ideas, knowledge and policies have raised the question about the ways countries might learn from their peers. This article examines the role of cross-national learning with regard to Diagnosis Related Groups (DRGs). We review the spread of this policy instrument and analyse the implementation of DRGs in three late-adopting countries: Germany, Switzerland and the Netherlands. The three cases show that the implementation of this policy instrument required intense studies, cooperation with stakeholders and adjustment to country-specific needs. The countries learned from foreign experience, but it was only with the introduction of a regulatory framework for competition between sickness funds that DRGs came fully onto the political agenda. While Germany and Switzerland drew upon foreign DRG models, the Netherlands developed an alternative system to classify patients according to case-mix.

The Changing Public-Private Mix in OECD Health-care Systems

The economic recession following the oil price shocks of the 1970s triggered a broad range of cost containment measures in social polices throughout the OECD world. Health care was no exception. Globalization, demographic change and advancements in medical technology have strengthened the need for reforms that assure both the quality and efficiency of health-care systems while at the same time guaranteeing equal access to services (OECD, 1994). The pertinent question to be dealt with in this contribution is how the role of the state and the market in attaining these challenging and somewhat contradictory objectives, has changed over time. Evidence suggests that although common challenges are experienced, the responses to various socio-economic pressures have differed considerably across healthcare systems (Tuohy, 1999; Rothgang et al., 2006). Starting in the 1990s, for example, we observe that in many predominately publicly financed health-care systems market-oriented health-care reforms have been implemented or proposed (van de Ven, 1996; Freeman and Schmid, forthcoming), whereas in countries with private insurance systems access to health care and the introduction of universal health insurance have gained political salience (Skocpol, 1994; Zweifel, 2000). This contribution focuses particularly on the ‘hybridization’ of health-care systems induced by the changing public–private mix. In order to capture these developments systematically, we differentiate between dimensions of health-care systems: financing, service provision and regulation.

The Changing Role of the State in Healthcare Service Provision

This chapter focuses on measuring the public/private-mix of service provision in order to evaluate the nature of the role the state adopts as a provider of healthcare services and how this role has changed over time. While internationally comparable time series on healthcare financing give a clear indication of the role of public relative to private financing, there is no such common standard for the service provision dimension. The absence of a straightforward indicator for measuring the public/private-mix of healthcare delivery might be one reason why the role of the state in service provision has only been poorly scrutinized (Wendt et al. 2005). However, a number of studies have concentrated on the relation between the state and healthcare providers (Frenk and Donabedian 1987; Moran 1999; 2000) and also on the question of ownership of healthcare provision (Moran 1999; 2000; OECD 1987b). However, these studies have not provided empirical evidence on the level of public service provision in cross-country comparison (Powell 2007; Wendt et al. 2009), nor have they treated service provision as a distinct dimension separate of financing and regulation.

Healthcare Financing in OECD Countries Beyond the Public-Private Split

Background: Studies of long-term trends in the healthcare financing mix generally focus on a dichotomous concept discerning public from private funding sources. More detailed analyses of the funding mix tend to be restricted to a small number of cases or do rarely examine time trends. Aim: This paper enhances the existing body of literature by developing and applying a trichotomous concept for healthcare funding, distinguishing taxes, contributions, and private sources. This includes a new aggregated indicator for the mix of three financing sources and its graphical representation. Methods: The study mainly builds upon OECD Health Data 2011. We measure changes in the funding mix since 1972 as its distance from a funding mix that equally draws upon taxes, contributions and private sources. Results: Up to 1980, the OECD healthcare systems move toward ideal-typical financing schemes. Between 1980 and 2000, the funding mix hybridizes mainly driven by privatization processes in NHS and social insurance countries and ongoing switch-over-processes between these two healthcare system types. Since 2000, OECD countries again tend toward ideal-typical funding schemes. Discussion: We use the framework for institutional change developed by Streeck and Thelen. The quantitative approach highlights changes in terms of displacement, layering, and drift but fails to fully reveal conversion processes. Therefore, further qualitative research is needed to capture not only shifts between the funding sources but also more gradual changes within them. Conclusion: The back-and-forth development of the trichotomous funding mix challenges assumptions of a universal trend toward hybrid financing structures.

The Changing Role of the State in Healthcare Financing

Institutional legacies are one broad explanation for considerable and persisting differences in the ways nations finance their healthcare systems (Pierson 2004; Taylor-Gooby 1996; Wilsford 1994). Yet it is clear that although all countries throughout the world rely on their own, specific funding-mix in healthcare, this mixture is also subject to readjustment and change (Huber 1998: 63; Scott 2001: 3). Changes in the funding mix may be caused by political interventions such as the inclusion of new groups in a public health1 insurance scheme, changes in co-payment rules or the scope of the benefit package covered by the public system (Maarse 2004b). Different growth trends of healthcare sectors which are predominantly financed by rather private or public funds may also alter the funding-mix substantially (Tuohy et al. 2004). Neither the financing structure nor funding levels have therefore been static during the past decades. While the development of total health expenditure and its determinants have been analyzed extensively, the evolution of public healthcare spending and of differences in the funding-mix across countries have attracted less attention (Barros 2007; for notable exceptions see Castles 2004; Comas-Herrera 1999; Mossialos and Dixon 2002; Starke et al. 2008). In this chapter we scrutinize the role of the state as a financer versus other sources of financing since the early 1970s in 23 OECD countries (see Chapter 1).

Western Europe, Health Systems of

The health systems of western European countries guarantee access to health care to effectively all of their populations. They are the product of common structural processes of industrialization, liberal democracy, and organized capitalism, which have served as a platform for the development and application of biomedical and, increasingly, managerial science. This article describes the typical legal and administrative arrangements of social insurance systems and national health services. It explores differences within and between groups of countries in the provision, finance, and regulation of health care and reviews evidence of convergence between them.

The Hybridization of Healthcare Regulation: An Explanation in Cross-national Perspective

It has been the principal challenge for OECD healthcare systems over the past four decades to reconcile the public demand for access to state-of-the-art healthcare with the need to control increasing healthcare expenditure. The oil crises of the 1970s heralded the end of a period of continual benefit expansion, while cost containment policies came to dominate the political agenda and efforts to improve the efficiency of healthcare systems gained in importance. This has fundamentally challenged the established regulatory structures of healthcare systems and provoked various adjustment processes.

Keeping an Eye on IRIS: Risk and Income Solidarity in OECD Healthcare Systems

Healthcare financing involves varying distributive effects and builds on different concepts of solidarity. We suggest a set of indicators to explore equity issues in healthcare financing using aggregate spending and revenue data: the Index of Risk and Income Solidarity (IRIS). Contrary to established indicators, IRIS compares eleven OECD countries over four decades. In terms of risk solidarity we observe upward convergence. By contrast, the average and the variance of income solidarity remain fairly stable over time. The expected reform pattern of increasing risk solidarity and reduced income solidarity is only observed in the Netherlands and Switzerland. Yet, this reflects country-specific political compromises rather than assumptions about the effects of health spending growth and global competition on income solidarity.