Healthcare regulation: an obstacle to cross-border trade in services Rita Baeten European Parliament, 18 October 2017

Directive on a proportionality test before adoption of new regulation of professions Assess whether the provisions are: necessary to attain a public interest objective suitable for securing the attainment of the objective pursued do not go beyond what is necessary to attain that objective Other Member States and interested parties may submit comments 42% are professions in the health and social sector No specific approach

Focus is on regulation related to reserving specific activities for professionals with a particular professional title continuous professional development language knowledge rules relating to the organisation of the profession, professional ethics and supervision compulsory chamber membership registration or authorisation schemes requirements limiting the number of authorisations to practice fixing a minimum or a maximum number of employees holding particular professional qualifications territorial restrictions

Background Jurisprudence of the Court of Justice of the EU (CJEU) Proportionality test Is a codification of the case law But CJEU recognized specificity of health(care) the fact that one Member State imposes less strict rules than another Member State does not mean that the latter’s rules are disproportionate where there is uncertainty as to the existence or extent of risks to human health, a Member State should be able to take protective measures without having to wait until the reality of those risks becomes fully apparent when there is uncertainty about the efficacy of alternative or less restrictive measures to protect public health, the inherent risks can be invoked to justify the maintenance of a measure

Proportionality test Assessment Proportionality test is a principle of good governance To counter: Corporatist private interests Protectionist national interests But: objective is not the proper functioning health system, but functioning of the internal market Creates substantial legal uncertainty Precautionary principle not applied

targeting regulation of (health)services Context EU level policy initiatives targeting regulation of (health)services Context Services Package Simplify procedures for service providers Proposal for a Proportionality Test European standardisation of services Healthcare Services Focus Group (HSFG) International trade agreements CETA, ... Services Directive did not live up to expectations => Removal of obstacles for cross-border trade => Obstacles = regulation

Importance of regulation in healthcare Access to healthcare is a fundamental human right large investments of collective resources From an economic perspective: market failures Information asymmetry Provider induced demand and ‘moral hazard’ Because the cost is mainly borne by a third public party. Therefore: Health systems are highly complex Activities of health providers require extensive regulation To ensure quality, access and the most cost-effective use of public financial resources

European standardisation of (health) services Aims to compensate for deregulatory construct of internal market Industry-driven Voluntary, but can have legal effect When used in contracts, accreditation processes, public procurement, referenced in legislation or in judicial proceedings, .. Healthcare Services Focus Group (HSFG) Goes far beyond technical specifications Deals with requirements on: healthcare facilities and premises, patients’ rights, insurance cover, pricing, billing, measurement, evaluation of clinical outcomes, who provides the healthcare service, where and how, human competences and training, the service structure: the professionals, departments, support services, communication, capacity planning

CETA Provisions applicable to healthcare regulation Market access rules Prohibition for rules limiting the number of service suppliers, the total number of service operations or the total quantity of service output ‘negative list’ approach: future new health services are not excluded from all the market access rules Investment Court System (ICS) could be used against any service regulations if it is considered to breach the ‘legitimate expectation’ of a stable business environment ‘ratchet clause’ and ‘standstill clause’ if a Member State has decided to liberalise certain aspects of its health system, it will not be able to reverse this decision

Conclusions Regulation of healthcare providers is seen as an obstacle to the operation of the market rather than as a way of ensuring access to healthcare, quality of care or the financial viability of health systems Puts pressure on the capacity of health authorities to regulate healthcare providers Creates substantial legal uncertainty In particular future regulation is targeted regulatory chill (e.g. e-health)

To know more http://www.euro.who.int/__data/assets/pdf_file/0004/342463/EH_v23n2_WEB_Final_23June2017.pdf?ua=1 http://www.ose.be/files/publication/OSEPaperSeries/Baeten_2017_OpinionPaper18.pdf