Spending Review Healthcare State of play May 30th 2016

Summary – Healthcare According to Ministry of Finance Over the past 10 years, spending on healthcare in Slovakia has grown significantly, however, healthcare results are poor compared to Hungary, Poland, Czech Republic (amenable mortality, life expectancy) Funds available in healthcare are perceived as sufficient We spend a lot on medicines Hospitals are inefficient (excess capacities and overprices purchases) Inefficiency in health insurance market We spend more than other countries on diagnostic imaging, laboratories, transportation and medical rescue services Data largely unavailable – responsible bodies reluctant to share data

Terms of Reference Goal in terms of healthcare results: Fiscal goals: Lowering amenable mortality to the average level of Hungary, Poland and the Czech Republic by 2020 (1872 less amenable deaths annually) Fiscal goals: Spending growth at inflation level Increase of capital spending of hospitals by 633 mln. EUR over four years (to cover the construction of 3 new hospitals and the renovation of 5 large hospitals)

Total spending Total healthcare spending (% GDP) Total healthcare spending (per capita, PPPs, USD, current prices)

(standardized death rate per Avoidable mortality High amenable mortality Deaths that can be prevented by healthcare interventions Compared with V3, there are 1890 more deaths annually in Slovakia Amenable mortality (standardized death rate per 100 000 inhabitants) - bez psychiatrií

Difference in life expectancy (women compared with men at birth) Low life expectancy (women at birth) Difference in life expectancy (women compared with men at birth) - bez psychiatrií

So where’s the problem?

Capital spending Investment spending in healthcare (per capita, PPPs, USD, current prices) Investment spending as a share of total spending (%)

Breakdown of spending in 2013 We spend too much on medical goods We spend too much on ancillary services We spend more on ambulatory care than the V3 countries We spend less on inpatient care

We’re looking for savings in four major areas Hospitals Medicines and other medical goods Health insurance companies Diagnostic imaging, laboratories, transportation and medical rescue services

Bed occupancy (% of available beds) Hospital beds Number of beds (per 1000 inhabitants) Bed occupancy (% of available beds) - bez psychiatrií

Hospitals Are hospitals run efficiently? Benchmarking of hospitals´ operational expenditure (looking for international benchmarks) Data envelopment analysis of inputs and outputs/ results (useful exercise?), recommendations for greater efficiency How much could hospitals save if they purchased services at prices achieved by most efficient hospitals/ market prices? Benchmarking of unit prices of services (data publicly available) and quantification of achievable savings

Consumption of medical goods and pharmaceuticals Consumption of medical goods, including pharmaceuticals (per capita, PPPs, USD, current prices) Consumption of pharmaceuticals and other medical non-durables ( per capita, PPPs, USD, current prices) - bez psychiatrií

Medicines and other medical goods I Does health insurance cover drugs that do not fulfill coverage conditions in terms of cost efficiency? Analysis of cost efficiency of expensive drugs, quantification of savings achievable by fulfilling cost efficiency conditions Review whether pharmacoeconomic analyses of drugs approved for reimbursement after 2011 meet the statutory requirements What savings could be achieved if special medical materials (implants, etc.) in each category were only fully reimbursed up to a particular level and co-payments were introduced for more costly alternatives? Quantification of savings with reimbursement at level of cheapest and median good in each category

Medicines and other medical goods II Can medicine consumption and spending be cut by introducing prescription guidelines? Analysis of differences in medicine prescription for similar diagnoses Is our medicine consumption too high? International comparison of consumption of medicines and medical goods (inpatients drugs, outpatient drugs, etc.) in specific categories Comparison of declared morbidity and drug consumption

Health insurance market Spending on health administration and health insurance (per capita, PPPs, USD, current prices)

Health insurance companies Does the distribution of health insurance contributions among health insurance companies reflect their costs? Analysis of redistribution mechanism Are health insurance companies managed in an efficient manner? Comparison of operating costs and quantification of achievable savings (looking for international benchmarks) Does the health insurance market allow the creation of economic rent? Analysis of health insurance companies profits (looking for international benchmarks)

Spending on ancillary services Spending on laboratories and diagnostic imaging (per capita, PPPs, USD, current prices) Spending on transportation and medical rescue services* (per capita, PPPs, USD, current prices) *The comparatively high spending on transportation and medical rescue services in Slovakia can be explained by high private spending, which amounts to almost half of total spending. In other countries these services are mostly covered by public spending.

Diagnostic imaging, laboratories, transportation and medical rescue services Are we paying more than other countries? Benchmarking of unit prices in Slovakia and neighboring countries (looking for international benchmarks) Quantification of achievable savings with prices at level of surrounding countries

Further issues considered

Inputs Workforce & salaries Too few nurses, number declining further; underpaid Stable number of physicians, close to EU average in number and pay Too many specialists Too few GPs

Outputs Consultations & hospital discharges Prevention Too many consultations per inhabitant Number of hospital discharges per inhabitant slightly higher than EU average Average length of hospital stay below EU average Prevention Breast cancer and cervical cancer screening below average

Appendix I: Inputs

Work force Too few nurses Stable number of physicians, dentists and pharmacists

Nurses The number of nurses has been falling since 2007 The discrepancy between the number of nurses in Slovakia and in other countries has been growing since 2004

Physicians and physicians’ age Number of professionally active physicians excluding dentists (per 1000 inhabitants)

General practitioners and specialists General practitioners and specialists in 2007 (per 1000 inhabitants) Slovakia has too few general practitioners Number of specialists is higher than average Number of surgeons, obstetricians and gynecologists is higher than in other countries

Physicians and nurses’ wages Income of general practitioner – employed (% of average wage) Income of nurse employed in hospital (% of average wage)

(2013, per million inhabitants) Medical Technology Medical Technology (2013, per million inhabitants) Medical technologies in hospitals (H) and ambulatory care (A) (2013, %) - bez psychiatrií

Appendix II: Outputs

Ambulatory healthcare Number of consultations (per inhabitant) Number of consultations is continuously higher than average (with the exception of 2005) - bez psychiatrií

Inpatient care Number of hospital discharges (per 100 000 inhabitants) Average length of hospital stay (number of days) - bez psychiatrií

Less surgical procedures compared to benchmarks (2013, per 100 000 inhabitants) - bez psychiatrií

Prevention – cancer Breast cancer screening ( % of population aged 50-69) Cervical cancer screening ( % of population aged 50-69) - bez psychiatrií

Appendix III: Data

Data Unavailable I. Hospitals Responsible institution Quarterly and annual data on economic management of healthcare institutions NCZI Annual data on the number and structure of healthcare workers and government emploees in healthcare Quarterly data on salaries, employees and government employees in healthcare eHealth data State-defined quality indicators UDZS Economic indicators on healthcare purchasing by health insurance companies DRG data Waiting times

Data Unavailable II. Diagnostic imaging, laboratories, transportation and medical rescue services Responsible institution Economic indicators on healthcare purchasing by health insurance companies UDZS eHealth data NCZI Medicines Quarterly data on issued medicines, medical goods and dietary foods Quarterly data on prescribed and issued medicines, medical goods and dietary foods covered by public health insurance

Data Unavailable III. Background data Responsible institution PCG data UDZS National registry of healthcare workers NCZI National registry of healthcare providers