Merging primary and secondary care providers

• 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 9

Abstract

Provision of municipal health services is usually divided into primary health care providers (health centres) and secondary health care providers (hospital districts). There are also separate acts on these services. However, there have been local reforms to integrate the service provision into a single organisation. Purpose of the reforms is to enhance co-operation between primary and secondary health care services and to create a better structural and financial basis for municipal services.

Purpose of health policy or idea

In Finland municipalities are responsible for providing public sector health services. Traditionally primary healthcare services are provided by health centres located in each municipality while secondary services are provided by hospital districts which are federations of municipalities (there are altogether 21 hospital districts in Finland). There are separate acts on primary and secondary health services.

During the last ten years several local reforms have been conducted to integrate the service provision into a single organisation. The purpose of these reforms is to enhance co-operation between primary and secondary health care and social welfare services. In addition, the reforms are also meant to promote co-operation between small neighbouring municipalities and to create a better structural and financial basis for the provision of municipal health services. The government, which has initiated a nationwide project to restructure municipalities and services in February 2005 (HPM 7/2006), has recently further endorsed this development.

Two most recent reforms of this type are conducted in the Itä-Savo and Päijät-Häme regions. In both of the regions municipalities formed new organisations to provide primary and secondary care and social services (started in 1.1.2007). The new organisations replaced hospital districts which provided only secondary medical services. Like hospital districts the new organisations are municipal federations which are governed by the member municipalities. Similar reforms have taen place in some other regions (for one somewhat similar example in Kainuu, see HPM 2/2003).

The Itä-Savo district is located in eastern Finland having nine municipalities as its members (and a population base of 60.000). One of the municipalities is a small city while the others are small rural municipalities. All member municipalities purchase secondary care services from the new organisation, seven of the municipalities (together 80% of population of the whole district) purchase primary health care services and three of the municipalities (together 62% of the population of the district) also some social services such as elderly care and services for alcohol and drug abusers. The district has eight health stations and one hospital.

The Päijät-Häme district is located in southern Finland having 15 municipalities as members (and a total population of 210.000 inhabitants). One of the municipalities (the city of Lahti) is the seventh largest city in Finland. The new organization is responsible for  providing secondary care services for all member municipalities, and primary health care and social welfare services for eight member municipalities having a total population of 51.000.

Main points

Main objectives

The purpose of these reforms is to enhance co-operation between primary and secondary health care and social welfare services. In addition, the reforms are also meant to promote co-operation between small municipalities and to create a better structural and financial basis for the provision of municipal health services.

Type of incentives

Small municipalities have difficulties to provide modern health care services on their own. The national government provides financial incentives for municipalites to conduct this type of reform.

Groups affected

Hospital districts, Health centres, Service users

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

By integrating primary and secondary care services and leading to stronger co-operation between municipalities in primary care, these types of reforms change the traditional structure of public sector health service provision rather significantly. New structures in service provision and the experiences resulting from these changes are needed to comply with Finnlands ageing population and shortage of personnel in health care.

The main controversy concerns the diminishing power of single municipalities and the power relations between primary and secondary services. The idea of the reform is not completely new as a few similar local reforms have been conducted earlier in other parts of country.

Political and economic background

The Finnish health care system is very decentralized. The responsibility of financing and providing public sector health services is given to the 416 municipalities. It has been a widespread opinion that the majority of municipalities are rather small for this task: more than 75% of the municipalities have fewer than 10 000 inhabitants and 20% have fewer than 2 000. Increasingly, the smallest municipal health centres are have problems with securing sufficient skills and funding for providing these services. For secondary care services the economic risk of a small municipality is unbearably high in spite of the mandatory risk pooling arrangements in the hospital districts.

The problems of small municipalities have been acknowledged for long. Some of the smallest municipalities have provided primary care services jointly with the neighbouring municipalities for decades. In 2006 there were altogether 65 of this kind of joint municipal federations. There have also been mergers of municipalities. In the last five years the number of municipalities has decreased by 7%.

Having separate organisational structures for primary and secondary care has had a negative influence on the co-operation between these levels. This separation can hinder an optimal organisation of care from both the clinical and economical perspective. For example, transmitting patient records and other information on the patient between primary and secondary care can be difficult. The separate organisations can also lead to a situation where primary health care has a too weak position in resource allocation, since facing a difficult financial situation municipalities have better possibilities to limit the costs of their own health centre than those of the hospital district.

Change based on an overall national health policy statement

Nationwide Project to Restructure Municipalities and Services (HPM 7/2006)

Purpose and process analysis

Current Process Stages

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

Origins of health policy idea

During recent years a political preparation and debate on the local and national level has been going on about the shift to larger units in municipal service provision either by reducing the number of municipalities or through creating new regional structures. The policy idea itself is not new as it has been discussed and proposed in differing forms with differing emphasis for a long time. A few similar local reforms have been conducted earlier.

Following the same direction, in February 2005 the government initiated a nationwide project to restructure municipalities and services which promotes this kind of reforms (HPM 7/2006). In January 2007 parliament accepted an act on how to continue this process. According to that act government will support mergers of municipalities, including financial support. The act also states that primary health care and social services closely related to health services should be organized by organisations covering at least 20.000 inhabitants. This does not necessarily require mergers of municipalities smaller than 20.000 inhabitants, but at least the forming of, for example, municipal joint federations.

Initiators of idea/main actors

• Government

• Providers

Approach of idea

The approach of the idea is described as:
renewed:

Innovation or pilot project

Local level - A few similar local reforms have been conducted earlier in other parts of country

Stakeholder positions

Hospital district managers have played a central role in these processes and have been promoters of the reforms. Positions have varied considerably among municipal managers and officials, also between municipalities as well as between managers in a municipality. There have also been different positions on this among municipal politicians. There has been a long negotiation process among managers and politicians to achieve a common understanding on the reforms. In municipalities, the main argument against the reforms has been the fear of losing control of local service provision. This is anticipated to possibly lead to negative decisions from the perspective of a municipality like, for example, transferring health centre services to another municipality. For municipalities this can be an important issue from the employment perspective as well as a health centre can be a relatively important employer in the municipality.

The Ministry of Social Affairs and Health has been supportive towards these types of reforms.

Actors and positions

Government
The Ministry for Social Affairs and Health	very supportive		strongly opposed
Providers
Municipalities	very supportive		strongly opposed
Hospital districts	very supportive		strongly opposed
Health centres	very supportive		strongly opposed

Influences in policy making and legislation

These reforms have not lead to a change of legislation.

 

Legislative outcome

n/a

Actors and influence

Government
The Ministry for Social Affairs and Health	very strong		none
Providers
Municipalities	very strong		none
Hospital districts	very strong		none
Health centres	very strong		none

Positions and Influences at a glance

Adoption and implementation

The main actors in the implementation have been the managers and other personnel of hospital districts and municipalities. An especially important role has been played by hospital district directors and some important local opinion leaders who have pressed ahead with the process. In addition, outside experts and consultants have had an important role in the adoption and implementation.

Monitoring and evaluation

The National Research and Development Centre for Welfare and Health (STAKES) will conduct a thorough evaluation on the reform in Itä-Savo during the years 2007-2010.

 

Dimensions of evaluation

Structure, Process, Outcome

Results of evaluation

Not yet available

Expected outcome

These reforms will probably enhance co-operation between municipalities and between primary and secondary health care in these regions. An undesirable effect can be that some services are centralised and that the distance to service facilities can increase. If the reforms are found to be successful, similar reforms will be conducted in other regions as well.

 

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

It is expected that the reforms might lead to a more co-ordinated management of social and health care services as a whole and improve somewhat the responsiveness, cost-efficiency, equity and quality of health services through more efficient planning and steering mechanisms.

References

Sources of Information

Project to restructure municipalities and services. http://www.intermin.fi/kuntajapalvelurakenne

Author/s and/or contributors to this survey

Lauri Vuorenkoski & Erja Wiili-Peltola, STAKES

Suggested citation for this online article

Lauri Vuorenkoski & Erja Wiili-Peltola, STAKES. "Merging primary and secondary care providers". Health Policy Monitor, April 2007. Available at http://www.hpm.org/survey/fi/a9/1