Purchasing process of Estonian Health Insurance Fund

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Purchasing process of Estonian Health Insurance
Fund

• Kristiina Kahur
• Senior Health Economist
• Estonian Health Insurance Fund
• kristiina.kahur_at_haigekassa.ee
• May 15 2008
• Bled, Slovenia

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Collection and pooling of funds

• Health system is mainly publicly funded through
  social health insurance system
• Funds are collected through contributions in the
  form of earmark social payroll tax
• Main purchasing agency is Estonian Health
  Insurance Fund (EHIF)
• Public revenue is pooled in EHIF (about 97 of
  revenue is social payroll tax)
• EHIF expenditures account for (in 2006)
• 85 of total public health expenditures
• 63 of total health expenditures

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Purchasing process of EHIF

• Source adapted from Couffinhal and Habicht, 2005

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• Needs assessment
• Is used as input and starting point for
  purchasing decisions
• Assessment of 4-year perspective
• Based on e.g.
• Data of utilisation of health services and
  waiting times
• Agreement with specialist associations
• Result of cases by specialties

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• 4-year budget planning principles
• Set priorities
• Give prognosis of the financial sustainability in
  4-year perspective

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• Establishment of the annual budget
• Priorities according to development plan
• Planning cases to ensure the access to care
• Budget (EEK) of cases x average cost per case
  (by specialties)
• Verify budget with assessed needs (establishing
  or adjusting maximum waiting times)

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• Selection of providers
• EHIF is not required to enter into a contract
  with all providers
• Provider can be offered a contract through the
  selection of providers (limited competition, up
  to 20 of out-patient care) up to 3 years
• EHIF is using public tenders and all providers
  can submit their bids

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Criteria for selective contracting

• Proximity of service provision to patient
• Share of provision of services in day-care
• Experience of last contracting period (rejected
  claims for reimbursement, complaints by
  patients)
• Price of services - lower price (compared to the
  reference price) is giving a preference

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Legal framework for contracting

• The contracting framework is set by Health
  Insurance Act
• A contract for financing medical treatment is a
  contract under public law and follows the rules
  set by the Administrative Procedure Act
• The standard conditions of the contract are
  agreed among EHIF and Estonian Hospital Union
• The financial appendixes (cost and volume by
  specialties) are agreed by single providers
  annually

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Conditions of the contract

• Contracts include the conditions for
• access to care
• quality of care
• reimbursement conditions
• reporting requirements
• liabilities of the parties in case of violation
  of the contract
• etc

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Structure of financial appendix of the contract
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Lessons learned from EHIF contracting experiences

• Developing strong contracting framework in
  Estonia has been learning by doing process
• Having standard contract conditions for all
  providers assures equal opportunities for all
  providers and is transparent for all parties
• Quarterly contract monitoring supports stable
  service provision over the all contracting period

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Further perspectives

• Fine tuning the purchasing process (needs
  assessment, contracting, budgeting)
• Improving DRG system
• Integrating a new model of provider reimbursement
  into the traditional reimbursement system of
  hospitals
• First steps towards implementing P4P
  (pay-for-performance) have been done

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Cross-border contracting

• EHIF does not exercise cross-border contracting
• Single health care providers may contract (no
  information available)

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Thank you!Aitäh!