SPPI for Private Health Services in Finland Currently at a phase of development Nordic SPPI Seminar 2010, Copenhagen Toni Udd Statistics Finland

CONTENTS BACKGROUND STRUCTURE OF THE INDUSTRY CLASSIFICATIONS STRUCTURE OF THE CUSTOMER BASE INDUSTRY’S MAIN SERVICES THE SCOPE AND SERVICES THAT SHALL BE INCLUDED IN THE INDEX SAMPLING WEIGHTS DATA COLLECTION INDEX CALCULATION RESULTS FUTURE PLANS 2

BACKGROUND Aim to increase the number of economic activities covered in the SPPI Private health services as one relevant but absent; others e.g. R&D, trade margins – still missing EU-funded project: Calculating B to All -indices and development of an index for private health services 3

STRUCTURE OF THE INDUSTRY 1/3 Health services - public and private service production - account for around 3.5% of GDP (~7% of service sector GDP; private sector’s share of the total health care service production is approximately 16%) NACE2 86: turnover EUR 2.2 billion, enterprises Production is dominated by the public sector: the local government is responsible for the organisation of both basic health care and hospital care services Private sector. Especially the production of occupational health care services, but households taken care as well 4

STRUCTURE OF THE INDUSTRY (2/3) The Social Insurance Institution (SII) is the key actor in private health care services SII reimburses to consumers part of the fee of examination or treatment charged by the private doctor or dentist An employer is also entitled to compensation from the SII for the occupational health care services it has organised SII doesn’t reimburse the costs of public health care Policy in public health care: the charging shouldn’t be an obstacle to seeking the services (a small fee / ceiling for total yearly costs) 5

STRUCTURE OF THE INDUSTRY (3/3) The largest producers of private health care services engage in multiple activities Medical practise, hospital services and laboratory examination services On the other hand physiotherapy enterprises are often one- person enterprises specialising exclusively in physiotherapy 6

CLASSIFICATIONS 7 NACE2 and CPA2008 utilized ”Own classification” at a service product level based on CPA 862 and 869 are the most essential in terms of value

STRUCTURE OF THE CUSTOMER BASE The key customer groups of private sector providers are a) households and b) employers a) Medical and specialist medical practise b) Occupational health care services, i.e. medical practise, laboratory and diagnostic imaging examinations Source: National institute for health and welfare 8

INDUSTRY’S MAIN SERVICES In Business Register the data on turnover of the enterprises is not comparable, The turnover is difficult to allocate to different services Figures here are estimated by the SII 9

THE SCOPE AND SERVICES THAT SHALL BE INCLUDED IN THE INDEX (1/4) 1) BtoB-perspective: services produced for enterprises and public sector by private sector i) Occupational health care services and ii) Diagnostic imaging and laboratory examination services offered to enterprises “INDEX FOR OCCUPATIONAL HEALTH CARE SERVICES” 2) BtoC-perspective: services produced by private service providers for consumers Two different indices that can be aggregated to form BtoAll 10

THE SCOPE AND SERVICES THAT SHALL BE INCLUDED IN THE INDEX, BtoB (2/4) Doctor’s services, laboratory and diagnostic imaging examinations Excluded: dental services and physiotherapy / not typically includued in occupational health services Services purchased by municipalities were left out / their share will be monitored and inclusion reconsidered Not all the clinics produce laboratory services or diagnostic imaging examinations on their own. Enterprises that are specialized in labo. serv. or diag. imag. exam. and offer those services to clinics should be included in the index 11

THE SCOPE AND SERVICES THAT SHALL BE INCLUDED IN THE INDEX, BtoC (3/4) CPI collects prices for doctor’s, dental, hospital and physiotherapy services (public and private) Different price concept: reimbursements of the SII are deducted and VAT included Of the services purchased by households from private sector providers, data was inquired for certain specified services of doctor’s and operation services Dentist services and physiotherapy was excluded (when necessary CPI may be used as a proxy) 12

THE SCOPE AND SERVICES THAT SHALL BE INCLUDED IN THE INDEX – SUMMARY (4/4) Service products whose price development is measured 13

SAMPLING Business register (BR) used as a sample frame The recording of turnover and size of personnel varies over enterprises in BR Judgemental sampling The sample contains approximately 20 enterprises The coverage is ~40% of industry’s turnover? BtoB: 6 service products and 300 price quotations BtoC: 5 service products and 150 price quotations 14

WEIGHTS Starting point: 1) Turnover for enterprises and 2) the distribution of turnover by service products for every enterprise Weights formed as in PPS even though judgemental sampling! Sample contains large and little smaller companies; aim to have a more even distribution of weights The ones that would have had the inclusion probability over one in PPS got their own turnover as a weight, the others divide the rest of industry’s turnover even This weight is then divided to service products according to the turnover distribution that was asked from enterprises BtoB and BtoC have their own weight structures 15

DATA COLLECTION, BtoB (1/3) List price (contract price) * discount percent Customer groups defined by enterprises, negotiation power Service descriptions for specialists from PPP surveys Less burdensome than... Alternatively: turnover / visits (or invoice / operations) for strictly spesified services and customers Contracts, prices are fixed for a certain time period 16

DATA COLLECTION, BtoC (2/3) Problems in collecting prices for general doctors and specialists Doctor’s are often practioners; set the prices - vary a lot between doctors, may work in many clinics, not necessarily in one clinic for two consecutive time periods, etc. Inquiries are not sent to single doctors! The price for certain doctor, most common - mode - price or the average price for doctors (is structural change eminent?) Otherwise list prices (are the same as transaction prices) 17

DATA COLLECTION, AN EXAMPLE (3/3) Prices seem to change one / two times in a year Historical data from 4Q/2007 (but not asked quarterly) See Excel-file as a demo (currently web-based data collection) Price_questionnaire_86_SPPI_NORDIC.xlsx 18

INDEX CALCULATION Sum(Qi0*Pit)/Sum(Qi0*Pi0) in the form of Sum[Wi0*(Pit/Pi0)] BtoB and BtoC are calculated separately BtoAll is formed as weighting the total indices together 2008=100 Weights from the year

RESULTS, EXPERIMENTAL, BtoB, (1/5) 20

RESULTS, EXPERIMENTAL, BtoB, (2/5) Year-on-year changes for service products, % 21

RESULTS, EXPERIMENTAL, BtoC, (3/5) 22

RESULTS, EXPERIMENTAL, BtoC, (4/5) Year-on-year changes for service products, % 23

RESULTS, EXPERIMENTAL, BtoALL, (5/5) 24

FUTURE PLANS Evaluating the results Publication Q1/2012 (as SPPI will be 2010=100 in Finland) NA could use the figures? At the moment NA interested in: Hospital services, doctors, dentists, other services Currently CPI series used as deflators Physiotherapy, dental services? Services purchased by municipalities? Sampling frame: consistent definitions, turnovers by CPA Extension of Business Services Statistics?! 25

THANK YOU! Toni Udd 26