2. Dutch Healthcare system Lessons learned & recent developments Michel A. Dutrée MD PhD 18th IPHA Annual Meeting 2011 1 st December 2011

3. -Nefarma -Future of pharma -Dutch system -Dutch market -2012 experimental year -Lessons learned Content

4. Nefarma - Dialogue - Lobby and dealmaking - Sector development - Knowledge sharing - Support - Guardian of the selfregulatory codes

5. Future of pharma -Change of business model -Coping with change -Diversifying industry

6. Some key figures of our sector 16.7 mln. people

7. Healthcare Spending’s Gross healthcare expenses 2012 63,5 bn. euro’s

8. A very simple healthcare system?

9. Framework of Dutch system Insurance Purchasing Provision of care

10. Dutch healthcare insurers

11. Dutch providers: non-profit hospitals In total: 94 hospitals and 184 private clinics (ZBC’s) in 2010 (NZa)

12. Dutch providers: doctors 19.703 medical specialists (medisch specialist) 11.121 GP’s (huisarts) 1 specialist per 848 people 1 GP per 1500 people

13. Dutch providers: nursing homes and facilities for the elderly - 479 nursing homes - 1131 rest homes - 290 combination organisations

14. Dutch providers: pharmacies 2011 bankruptcy threat for 20% of the pharmacies

15. Dutch Healthcare providers: trends -Integration -Concentration -Specialisation -Standardisation via guidelines - Reduction of Costs

16. Comparison: NL versus Ireland Average time between registration and patient access in days

17. Comparison: NL versus Ireland Average spending on drugs per capita in euro’s (2009 ) Share of pharmaceutical care in total healthcare budget in % (2009)

18. Dutch pharma market Source: Farm inform September 2011. Sales in € *million at Pharmacist Purchase Price, hospital market & pharmacy market, Rx Total market €4.889*mln Total market 15.974 *mln counting units

19. Dutch pharma market Source: Farm inform September 2011. Sales in € *million at Pharmacist Purchase Price, hospital market & pharmacy market, Rx Total market €4.889*mlnTotal market 15.974 *mln counting units

20. Lessons learned: price decrease of 50% in 15 years

21. Recent developments at dawn of 2012 -Hospital funding of medicines Injectables like TNF α will be exclusively reimbursed in hospital DBC/DOT, a price per ‘care product ’ -Reimbursement Reimbursement authority lacks capacity and model is outdated Conditional reimbursement -Preference policy Combination drugs Biologicals/ biosimilars - Therapeutic substitution (between ATC level)

22. 2012 experimental year for Dutch system: is it sustainable or not?

23. Dutch drugs entitlement and funding MoH CFH ACP Entitlement hospital In line with most recent scientific data and common practice (registration) Entitlement Extramural Admission on positive reimbursement list Expansion budget (80% of) costs of valuable drugs Annex 1a Annex1b Annex 2 Criteria: - Therapeutic value - Cost prognosis - HTA - re-assessement after 4 years Direct through policy: * preference policy * extra conditions Situation 2011: Entitlement and funding Limitation/ Steering entitlement by healthcare insurer : Indirect through contracts with HCP’s Funding Extramural Declaration (max. tariff WMG = prescriptionreimbursement (rrv)+ material costs) by pharmacist to healthcare insurer Funding Hospital Cost coverage coming from hospital budget Responsability and risk for hospital CVZ Nza policy rule In doubt: CVZ

24. Dutch drugs entitlement and funding MoH In doubt: CVZ CFH ACP Entitlement hospital In line with most recent scientific data and common practice (registration) Entitlement Extramural Admission on positive reimbursement list Included in DBCzp price Annex 1a Annex 1b Annex 2 Nza rules with still to be determined criteria - no homogeneity DBCzp - macro costboundary - limiting value drug cost treatment per patient € 500/1.000 – 10.000 - Max price/tariff Direct through policy: * preference policy * extra conditions Situation 2012: Entitlement and funding Limitation/ Steering entitlement by healthcare insurer : Indirect through contracts with HCP’s Funding Extramural NO more tariff regulation Free negotiations based on descriptions of performance by NZa. Hospital funding DBCzp declaration (calculated for 2012 (90%) and 2013 (70%) shadowbudget CVZ B segment no tariff Freely negotionable As add on, on top of DBCzp price Possible exclusion by decision MoH HTA assessment – assessment NZa ? Steering of entitlement by healthcare insurers through contracts with HCPs

25. Lessons learned part 1 5 years on the way: No reduction of costs -Healthcare costs increased 27% Insurance premiums soar -Basic package by 9% -Additional voluntary coverage packages by up to 50% in 5 yrs. No competition whatsoever due to -Megamergers of insurance companies -No choice for the patient (not enough doctors) Overcomplicated reimbursement system with over 30.000 declaration codes

26. Lessons learned part 2 -New system requires ‘crash barrier’ thinking. Defining the playing field. -The system is drifting away from central regulation by government. So no safety nets for all parties -Insurance companies focus only on cost containment/ price NOT on quality and act as a “Politburo” with all the bureaucratic tricks to block access to care -Reimbursement authorities politicize quickly….only cost containment counts and…. access slows down

27. Leasons learned for the sector -Change of business model of industry is happening Change of decision makers Change of ways of earning money: the world of care programs: thinking beyond the pill -Only real innovations with significant added value to the patient will be reimbursed -Step by step innovations only reimbursed if added value for patient compliance

28. Main conclusions about the system -A system that rises costs and diminishes benefits for the patient -Completely Cost driven with only lip service to Quality -Insurance companies in the driver seat -No level playing field so no fair negotiations -No one is happy with the system! Even healthcare insurers

29. Solutions -Even playing field Fair negotiations -Defining the market -Guidelines -Focus on outcomes -One reimbursementsystem  hospital +extramural -Working from benefits for the patient -Real collaborations between stakeholders

30. Questions? E: m.dutree@nefarma.nlm.dutree@nefarma.nl T: (+31)703132211