Sanitary shield

• Abstract
• Purpose of health policy or idea
• Characteristics of this policy
• Political and economic background
• Purpose and process analysis
• Expected outcome
• References

Featured in half-yearly report: Health Policy Developments 10

Abstract

In order to limit out-of-pocket payments on reimbursable healthcare services, it is proposed that a yearly threshold for out-of-pocket expenditures should be installed. This “sanitary shield” aims mainly to protect patients without supplementary health insurance. The project will be discussed with main stakeholders in the first semester of 2008.

Purpose of health policy or idea

In France there is a complex system of reimbursement for publicly insured health care with different co-payment rates for different goods and services, plus deductibles for certain types of care and with many cases of exoneration. The current government wants to introduce additional co-payments in 2008, in the form of fixed contributions (deductibles) for certain services.

Currently, people suffering from a list of thirty "long and costly diseases" (such as cancer, severe chronic diseases, long term psychiatric diseaes…), certified by their physician, are covered 100% by public health insurance for that disease. But they would still have to pay for health services which are not directly linked to this specified disease. It is estimated that about 16 % of those patients are bearing out-of-pocket payments, just for outpatient care, more than 500 Euros a year. The same problem is noted for 9 % of patients who are not classified as seriously ill. Moreover, the High Council for Health Insurance estimates that there are about 2.3 million people in France bearing on average 500€ for their inpatient care. Some of this expenditure would be covered by the supplementary insurance for those who have one, but about 8% of the population, mostly from low income groups, do not own a supplementary private insurance and they risk excessive out-of-pocket payments.

The "sanitary shield" aims mainly to protect patients without supplementary health insurance against high out-of-pocket expenditures.

The implementation of a sanitary shield is also seen as an opportunity to simplify the public health insurance scheme and the instruments used for controlling public health expenditures.

Several possible strategies

A technical feasibility report published last September explores several possible strategies for the implementation of the sanitary shield:

• "Target scenarios": the current reimbursement system is replaced by a unique proportional co-payment on ambulatory care and an annual maximum amount of out-of-pocket expenditure for reimbursable goods and services. Only pregnant women and Universal Complementary Health Coverage beneficiaries (lowest income group receiving free care for a large basket of services) would be exonerated from any co-payment. Two options are analysed for the annual threshold: a fixed amount for all regardless of their income or a threshold increasing with household income (five income groups are proposed). Separate annual amounts would be set for inpatient care, and ambulatory care.
• "Withdrawal scenario": same design, but two proportional co-payment rates: lower for long and costly diseases, higher for the others.

Each scenario is analysed in a neutral financial perspective to assess their impact on public health expenditures.

Type of incentives

Regulatory. The sanitary shield would concern the whole population (except the poorest group who is exonerated from any co-payment). The amount of co-payments to be paid before the threshold is reached could be covered by supplementary private health insurance contracts (mutuelle), hence a significant change in supplementary insurance market could be expected (see also section "Expected outcome").

Groups affected

Patients, private health insurers

Degree of Innovation	traditional		innovative
Degree of Controversy	consensual		highly controversial
Structural or Systemic Impact	marginal		fundamental
Public Visibility	very low		very high
Transferability	strongly system-dependent		system-neutral

Political and economic background

Government plans to introduce new deductibles to close budget deficit

The financial situation of public health insurance is a permanent worry: after a declining deficit in 2005 and 2006, health expenditures took off in 2007 to such an extent that a recovery package had to be implemented in last summer. New ideas to close the budget deficit are welcomed more than ever. 

Nicolas Sarkozy's presidential program included the introduction of new deductibles on a number of healthcare services. For instance, it is suggested that the first 50€ for physician consultations should not be reimbursed; usual co-payment arrangements would apply only after the first 50€. After the elections, the new health insurance financing act, which will be voted at the end of 2007, suggested the introduction of a set of new co-payments in the form of deductibles: 0,50 € for each medicine bought and per paramedical act, 2 € for ambulance transport. This project (called "deductibles") is presented as a way of financing new health care needs (for eg. Alzheimer patients) but received a strong opposition from media and public.

Sanitary shield is to protect economically less advantaged groups

Martin Hirsch, a left-wing highly respected civil servant entered into the government as "High commissioner for solidarity against poverty" -thanks to Sarkozy's "opening" policy-, is the father of the idea of "sanitary shield". He judged that the new deductibles would have an unfair impact on the economically less advantaged groups. The Health Ministry and the High Commissioner asked two experts to prepare a technical feasibility report for such a system. Their report was published in last September.

Change of government

Purpose and process analysis

Current Process Stages

	Idea	Pilot	Policy Paper	Legislation	Implementation	Evaluation	Change
Implemented in this survey?

Origins of health policy idea

See section "Political and economic background".

Initiators of idea/main actors

• Government: High commission for solidarity against poverty works like a Ministry, directly under the Prime Minister

• Payers

Approach of idea

The approach of the idea is described as:
new:

Stakeholder positions

The positions of various stakeholders are not clear at all at the moment. The public debate has been filled until now by the discussion around new deductibles proposed for 2008, which faces strong opposition from patients and a part of health professionals as well as left-wing political parties. In this context, the sanitary shield could be seen as an acceptable instrument for counterbalancing the impact of new co-payments. However, the criticism put forward against the deductibles could apply as well for the sanitary shield; that is a "double punishment" for the chronically ill persons (in the sense that they are once punished because they suffer from the physical and mental consequences of their illness; and second they would be punished financially: under the sanitary shield program they would have to make co-payments from which they currently exempted). The technical complexity of implementing such a system is pointed out as a problem by the public health insurance funds. Private insurance operators did not express their position for the moment.

Actors and positions

Government
High commission for solidarity against poverty	very supportive		strongly opposed
Ministry of Health	very supportive		strongly opposed
Payers
Public health insurance funds	very supportive		strongly opposed
Mutuelles	very supportive		strongly opposed

Actors and influence

Government
High commission for solidarity against poverty	very strong		none
Ministry of Health	very strong		none
Payers
Public health insurance funds	very strong		none
Mutuelles	very strong		none

Positions and Influences at a glance

Adoption and implementation

The project will be discussed with main stakeholders (patient associations, complementary health insurance operators, medical unions…) in the first semester of 2008. New assessments of the potential impact will be asked for inpatient care. Alternative projects such as the introduction of a more efficient voucher system for low income households to subsidize their supplementary insurance will also be debated.

Technically, introducing an income-dependant threshold for outpatient care is not feasible before 2010. Even then, only individual out-of-pocket expenditures for ambulatory care could be tracked. The authors of the report doubt that inpatient care could be included in the mechanism at the same time and suggest a separate system.

Expected outcome

The report prepared by two experts (Briet-Fragonard) evaluates the expected outcomes for different scenarios. Generally speaking, there would be a trade-off between the level of the annual expenditure threshold set and the co-payment rates.

• If the co-payment rate is the same for everybody, the number of people reaching the maximum amount would be lower if the threshold is higher. An estimated 5% would benefit from sanitary shield if the threshold is 900 € a year [1] while this is close to 26% for a threshold of 400 €.  At the same time the co-payment rate would be close to 40% in the low threshold scenario while it would be around 25% in the high threshold one.
• In general, the "winners" would be those patients who are not classified currently as chronically or seriously ill. It is important to note that for people covered by a supplementary insurance, the gains or losses are only virtual: they represent a transfer between public and private insurance reimbursements.
• The chronically/seriously ill patients might "lose" in the new system as the annual threshold rises.

One option is to differentiate the co-payment rates for chronically ill (or high cost disease) patients and others, the later paying significantly higher rates.

The potential impact of this instrument on patients' behaviour is not clear. There might be a risk of over-consumption of care for those people who passed the threshold. On the contrary, there is a risk of under-consumption for the low income groups in case the threshold is not income-modulated.

Moreover, this reform might affect substantially the private supplementary insurance market. The report argues that since after a certain expenditure limit all the reimbursement will be covered by the public health insurance, the risk level for private supplementary insurances will decrease significantly. Therefore insurance premiums would go down. But it is also possible that some insured people, rather those feeling healthy, could give up their contracts. At the end, if only the high risk persons contract for supplementary insurance, premiums could rise excessively.

It is important to recall that the expenditures covered by the sanitary shield concern only "ticket moderateur", that is the part left to the patient in regular publicly reimbursed goods and services. It is possible that the insurance operators would enlarge their market and create new contracts extending to the range of non reimbursable goods and services, extra billings, comfort services, etc. This might have an inflationist impact on the market. 

Finally, it is important to note that this reform focuses on the co-payment arrangements as regulatory instruments for controlling health expenditures. The extensive attention paid to this reform could be to the detriment of more structural reforms, on integrated care organisation for instance. 

[1] Euros 2004, without taking into account extra billing and before any supplementary insurance coverage

Impact of this policy

Quality of Health Care Services	marginal		fundamental
Level of Equity	system less equitable		system more equitable
Cost Efficiency	very low		very high

References

Sources of Information

Bras, P-L , Grass, E and O. Obrecht. "En finir avec les affections de longue durée,(ALD), plafonner les restes à charge". Droit Social, April 2007.

Briet, R and B Fragonard. Rapport sur la mission Bouclier sanitaire. September 2007. www.sante-jeunesse-sports.gouv.fr/IMG/pdf/rapport_bouclier_sanitaire.pdf 

Rapport du Haut Conseil pour l'avenir de l'assurance maladie. July 2007. www.securite-sociale.fr/institutions/hcaam/rapport2007/hcaam_rapport2007.pdf

Author/s and/or contributors to this survey

Cases, Chantal

Suggested citation for this online article

Cases, Chantal. "Sanitary shield". Health Policy Monitor, October 2007. Available at http://www.hpm.org/survey/fr/a10/3