Logical epilogue of a never-ending story

• Abstract
• Characteristics of this policy
• Purpose and process analysis
• Expected outcome
• References

Abstract

After a tormented parliamentary procedure lasting several years the hospital financing reform bill was approved in December 2007. This time the losers were the cantons. The legislative process was longer than expected, not least because of their opposition to the dual-fixed model proposed by the Federal Council. Ex-post the cantons? strategy was a failure; the final text of the bill entails higher financial burdens and less autonomy for them than foreseen in the government?s proposal.

Neue Entwicklungen

The content of the legislative package concerning hospital financing has been defined for several years in its general outline. These are the two main aspects:

• Switzerland has also chosen DRG as the reimbursement system for the inpatient care delivered in acute hospitals. To be more precise the experts' choice fell on the German grouper G-DRG, which will be "adjusted to the Swiss context". By using a mapping process the German system of procedure and diagnosis classification will be matched with the situation in Switzerland, so as to be able to group the cases together while still referring to the codification system used at present in Switzerland.
• The DRG will be jointly financed by cantons and health insurers according to a fixed share that, once established, will be uniform in all Swiss cantons.

The amendments which came about in the legislative process concern some details, although the results of these changes can be judged as quite substantial, at least from the financial point of view. Let's start with the aspects which in fact penalize the cantons.

1. First of all there is the financial burden weighing on the two financing bodies. In the initial project the Federal Council had proposed a fifty-fifty distribution but this encountered strong opposition from the cantons and a more moderate opposition from the health insurers. In the final document the distribution has been altered; 55% of the DRG will fall on the cantons and 45% on the health insurers, thus marking a double defeat for the cantons; not only did they not manage to reduce their own share but they even have to take an increase.
2. The second detail concerns the free choice of hospital for the patient and the removal of the present cantonal barriers, which was not taken into consideration in the initial proposal. Although the cantons were against it, Parliament introduced this freedom of choice, but it granted the cantons a softer version with respect to the proposal put forward by the National Council in March 2007 (see report 9/2007). At present the cantons are called on to participate in hospitalization expenses outside the canton of residence only if these are necessary from a medical point of view and have been authorized by a special cantonal body. Therefore, all the expenses of the spontaneous flows of patients, without medical necessity and authorization, fall on the mandatory insurance, which covers the same fee as would be paid in the canton of residence, and on the patients themselves or their private complementary insurance. With the new law the cantons will be called on to co-finance these spontaneous flows too; in fact, the need to obtain authorization to be treated outside the canton will no longer apply. However, the participation of both the financing bodies will be calculated on the basis of the fee in force within the cantonal boundaries. If the DRG is higher in the canton where hospitalization takes place than in the patient's canton of residence, the difference in costs will have to be borne by the patient or his/her private insurance. At the beginning this limit to coverage was not provided for.
3. Hospital planning still remains a task for the cantons, but the Confederation has cut out a complementary role for itself in this field too; if there is no spontaneous agreement between the cantons, it will establish the institutions where high-tech medical procedures can be developed. Then the Confederation will define the criteria (in particular concerning quality and cost performance) toward which the cantons will be required to orient their planning efforts.

Now let's come to the more important aspects which represent a compromise solution, which favors the cantons' claims.

1. In the first place the law provides for private structures accredited only by the health insurers, the so-called "contract hospitals", to be maintained beside the hospitals accepted on the hospital list and therefore co-financed by the cantons and insurers according to the dual-fixed method previously illustrated. This concession might allow the cantons to plan their hospital supply, along with their own financial contribution, not on the needs of the whole population but only on the group of citizens who do not intend to opt out of the planned system. In fact, part of the population, because they have private insurance coverage, would in any case apply to private hospitals for inpatient care and therefore opt out from public contributions.
2. The second concession concerns the deadline by which the change should be realized. The new law is to come into force by 1.1.2009. Some provisional measures have been approved, which will delay the introduction of several single aspects of the law. Payment by means of SwissDRG will come into force only on 1.1.2012; this will also include the investment costs. By the same deadline free choice of hospital should come into force. The introduction of the new distribution of the financial burdens (55% - 45%) should also come about by the beginning of 2012, but with two possible exceptions. The cantons which at present subsidize a very low share of hospital expenses because of the presence of private structures which are totally financed by the health insurers will be able to adapt their contribution gradually, increasing it by 2 percentage points per year, so as to fulfill the legal requirements (55% of the DRG in all hospitals included on the hospital list) by 1.1.2017. Since the new hospital planning, based on service contracts and on quality indicators, will not be ready before 2015, the cantons have asked the Federal Council to decree a shift of a further three years for the public participation for hospitals still not co-financed by the State. Only in this way could it be possible to avoid co-financing private hospitals earmarked for exclusion from the hospital list for three years.

Innovationsgrad	traditionell		innovativ
Kontroversität	unumstritten		kontrovers
Strukturelle Wirkung	marginal		fundamental
Medienpräsenz	sehr gering		sehr hoch
Übertragbarkeit	sehr systemabhängig		systemneutral
current    previous

Purpose and process analysis

Current Process Stages

	Idee	Pilotprojekt	Strategiepapier	Gesetzgebung	Umsetzung	Evaluation	Veränderung/Richtungswechsel
Implemented in this survey?

Initiators of idea/main actors

• Regierung

• Parlament

• Leistungserbringer

• Kostenträger

Actors and positions

Regierung
Cantonal health ministers	sehr unterstützend		stark dagegen
Parlament
Council of States	sehr unterstützend		stark dagegen
National Council	sehr unterstützend		stark dagegen
Leistungserbringer
Swiss hospitals association	sehr unterstützend		stark dagegen
Kostenträger
Health insurers' association	sehr unterstützend		stark dagegen
current    previous

Actors and influence

Regierung
Cantonal health ministers	sehr groß		kein
Parlament
Council of States	sehr groß		kein
National Council	sehr groß		kein
Leistungserbringer
Swiss hospitals association	sehr groß		kein
Kostenträger
Health insurers' association	sehr groß		kein
current    previous

Positions and Influences at a glance

Expected outcome

In order to know the real characteristics of the future hospital sector in Switzerland we will have to wait for some years still. A decisive role will be played in this sense by the decree of application of the law, on which a consultation was carried out; it was concluded on 5th May 2008.

The Confederation might decide to oblige the cantons to adjust their hospital planning with respect to the inpatient care demand of the whole population, thus exercising seriously the role which the law attributes it of establishing hospital planning criteria. In this case the "contract hospitals" would carry out a marginal function in the future system and the private structures would find themselves allotted with a role potentially equal to that of public hospitals, which are presently managed by the cantons. Moreover, public and private hospitals would be regulated and financed according to criteria for the assessment of efficiency and quality which are really equivalent. Without this intervention by the Confederation, in cantons marked by the presence of a large number of private structures not subsidized at the moment, there might be an attempt by the cantonal authorities to privilege the present public structures in the planning phase, relegating the private hospitals to the secondary market of the "contract hospitals". If the health insurers subscribe to this kind of contract with the private clinics and if the population does the same with their complementary health insurance policies, the hospital geography of these cantons might remain similar to today's, with the advantage for the cantons that they will have saved an important slice of public money earmarked for the co-financing of hospital services provided in private law structures. If this is not the case, a second scenario might be realized; these private structures could disappear from the market and be partially reabsorbed in public structures, that is once the over-capacity and duplicates were eliminated. The result of this scenario would be a simplification of the local market, which might take shape as a public monopoly; in any case there would be an increase in public contributions compared to the present situation, corresponding to the cases treated today in the non-subsidized private structures and tomorrow in public ones, but these contributions would be paid to structures which present a governance controlled by political powers, at least in appearance. Finally, in terms of economies of scale, this integration of hospital supply at cantonal level might offer advantages in relation to the outlined opening of the borders to national competition. In order to regulate the activity of the local monopoly (in any case corss-border patient flows of patients are destined to play a secondary role) it would be necessary to set up a neutral and independent regulatory agency which should be preferably embedded at a superior (the federal) institutional level.

All these scenarios could be put to discussion again by the approval of the new constitutional article on 1st June 2008 (see report 10/2007). In this case a monist financing system would be introduced and the share of public financing for hospital services would be paid directly to the health insurers.

Impact of this policy

Qualität	kaum Einfluss		starker Einfluss
Gerechtigkeit	System weniger gerecht		System gerechter
Kosteneffizienz	sehr gering		sehr hoch
current    previous

References

Sources of Information

[1] Federal Assembly, Bundesgesetz über die Krankenversicherung (Spitalfinanzierung). Änderung vom 21. Dezember 2007 (www.admin.ch/ch/d/ff/2008/9.pdf).

[2] SwissDRG Newsletter 1/2007 (www.swissdrg.org/assets/pdf/newsletter/SwissDRG_Newsletter_07_1_d.pdf).

Reform formerly reported in

Hospital financing reform (?dual-fixed?) Process Stages: Gesetzgebung

Revolution of hospital financing reform plan Process Stages: Gesetzgebung

Back to the future in Swiss hospital financing Process Stages: Gesetzgebung

Abolishing cantonal barriers in hospital market Process Stages: Gesetzgebung

Author/s and/or contributors to this survey

Crivelli, Luca

Proof-reading by Mary Ries

Empfohlene Zitierweise für diesen Online-Artikel:

Crivelli, Luca. "Logical epilogue of a never-ending story". Health Policy Monitor, April 2008. Available at http://www.hpm.org/survey/ch/a11/1