November 2015 - Outcome-based funding
The Healthwise Expertise Centre of the University of Groningen and the UMCG organised a joint autumn symposium on outcome-based funding, also known as population-based funding, on Friday 27 November 2015. Managers, professionals and researchers from healthcare, academia and administration were cordially invited to this meeting. Our autumn symposium offered a varied programme of lectures by academics and professionals from practice.
This symposium was aimed at exploring whether this different form of healthcare funding leads to better health and financial results than the existing funding model, based on compensation for services. Experiments with this new form of funding are already running, both internationally and, on a smaller scale, in the Netherlands. The first results are very interesting, especially regarding care provision to vulnerable seniors and the chronically ill. The speakers came from economic science, hospitals or health insurance companies, or they were the initiators of this form of funding in the Netherlands.
This mix of economic and business know-how, illustrated with examples from practice, guaranteed an instructive afternoon.
Looking back (keynotes)
Keynote Lecture by Kees Ahaus, University of Groningen
Kees Ahaus, the UMCG's Professor of Healthcare Management associated with the Faculty of Economics and Business of the University of Groningen, used his presentation to outline a framework for the rest of the day. In order to put population-based funding into perspective, he started his presentation with an audience assignment: ‘discuss the incentives produced by the current forms of funding and the associated risks’. ‘Fee-for-service’ funding may, for example, encourage performing the same service as often as possible, thus entailing the risk of overproduction.
Ahaus introduced the term ‘Triple Aim’ next, an influential model for organising healthcare systems, developed in the US by the Institute for Healthcare Improvement (IHI). This model postulates three goals worth striving for simultaneously:
- improving the experience of the patient, including quality and satisfaction
- improving the health of the population
- reducing the per-person expenditure on care.
Subsequently, Ahaus discussed several practical examples of population management at home and abroad, characterised by a proactive, integral approach to care and well-being across the continuum.
Keynote Lecture by Rob Alessie, University of Groningen
Rob Alessie, professor at the Faculty of Economics and Business of the University of Groningen, talked about his research into the life-course perspective on health. In order to be able to steer on health funding, the argumentation goes, it is necessary to know how health develops over the course of a life. The first question that arises is: how do we measure health? Alessie points out that there are objective indicators, such as blood pressure and other physical values, to measure this, as well as subjective, self-reported data. The latter category includes questions such as ‘how would you score your own health?’ or ‘how has your health changed this year?’ These subjective data are more sensitive to certain forms of bias, i.e. distortion, so they are ideally coupled with objective data. In his research, Alessie takes the same approach to broader factors, such as use of medication and care, income and level of education. By monitoring people over long periods of time, asking the same questions over and over again, generation and age effects become noticeable. Alessie’s research shows that there are plausible associations between socioeconomic status and health, that some afflictions have a bigger impact on perceived health than others, and that health declines faster than usually assumed. The latter, he indicates, may be explained by the fact that the objective indicators are less sensitive to reporting bias. Models such as this can help predict the demand for care.
Keynote Lecture by Marcel Kuin, Treant
Marcel Kuin, President of the Board of Treant, gave a presentation entitled A view on the possibilities of population management in the south-east Drenthe region. With a shrinking population and a relatively high percentage of inhabitants with chronic diseases, this region requires special solutions. Kuin stressed the importance of careful deliberation about the different components of population management. What are you going to manage: a village, a region or a neighbourhood?; who is going to manage it, who can fulfil this role?; and what are you trying to achieve: the stimulation of care or the opposite? He also stresses the great importance of looking carefully at the environment in which you operate. Subsequently, Kuin discussed the highly successful ‘Good beginnings require a good start’ project, run in the Southwest of Drenthe and aimed at disadvantaged single mothers. The project was characterised by a ‘systemic approach’, in which several actors, including hospitals, nurses, mental healthcare institutions, schools and municipalities, cooperated. Substantive, although not financial, agreements were made about the care required before, during and after childbirth, with assistance being offered to girls as young as 14. The results were very positive: fewer premature births, fewer caesarean sections, better mental health and less domestic violence. The success factors were: an active role for local government as the only neutral, disinterested party, citizens as lead, use of new media, result orientation and financial creativity.
Keynote Lecture by Jurriaan Pröpper, Optimedis
Jurriaan Pröpper, Director of OptiMedis, gave a presentation entitled Rewarding increased health in regional networks - Healthy Kinzigtal and other sources of inspiration to and in the Netherlands. He stated that the current, segregated manner of funding actually hampers cooperation: each caregiver is contracted separately and then asked to cooperate with the others, who are also contracted separately, while almost every care need requires multiple caregivers and sources of funding. He claimed that the care sector should make the transition from cost to return, the creation of value in terms of health yield per Euro. Cost prevention in secondary healthcare will become particularly important. Caregivers should assume joint responsibility for groups of people with identical needs, making multi-annual agreements with them to make prevention truly interesting. Caregiver autonomy and the ability to invest in innovation lead to a care boom, whereas the current situation, in which extra efforts, such as prevention, are not compensated, may cause cynicism among caregivers. He claimed that, for good population management, the following conditions need to be met:
- More room and flexibility in legislation. At the moment, for example, only the care expenditures actually incurred are being compensated, not the ones prevented.
- Contract innovation. Contrary to the previous case, Pröpper claimed that agreements about the distribution or creation of value should be made beforehand to avoid the risk of parties’ keeping their cards close to their chest.
- A contract party is needed, preferably as neutral as possible, to serve as an integrator. In the case of Kinzigtal, a new organisation, financed initially through start-up funding and subsequently from the savings they themselves generated, fulfilled that role.
- Vision. Primary and secondary care need to develop a common vision of how to improve care.
- Data will be a crucial element in this process: without it, we have no idea whether or not people are actually healthier, making accountability an impossibility.
He described the case of Kinzigtal, Germany, where the above principles have been applied and patients were able to cooperate in prevention programmes on a voluntary basis. General practitioners were paid to help patients make choices. The extremely positive results are an average life extension of 1.4 years and a 23% drop in hospitalisation rates, while 99% of the patients indicated that they would recommend the programme to others.
Presentation by Jurriaan Pröpper (only available in Dutch)
Keynote lecture by Olivier van Noort, Menzis
Olivier van Noort, senior purchaser district nursing at Menzis, concluded the programme with a presentation entitled Menzis and population-based funding, in which he explains the insurance company’s perspective on population-based funding. Health insurance companies in the Netherlands are investigating whether new funding models can be used to reward care providers for quality and efficiency. Van Noort refers to work done in Boston, US, under the name alternative quality contract. It departs from the notion of capitation funding, introducing more risk for caregivers by allotting them a fixed amount per policyholder. That risk, however, will then be spread: caregivers can ‘earn back’ a substantial part of potential budget transgressions by providing high quality. To measure quality, 64 quality indicators and 5 quality levels have been defined. If the budget is exceeded but the care provided is of the highest quality level, 80% of the costs incurred are covered by the insurance company. With cost-cutting measures, the caregivers can also keep more for themselves if the quality of the care provided has been high. Van Noort points to the great importance of having good indicators in this quality assessment process. Subsequently, he shed his light on two projects in the Netherlands: the reform of long-term care in Proeftuin Enschede and the Shared Savings Enschede project, where quality is perceived in two ways: absolute, i.e. as benchmarked against others, and in terms of changes over time. In this project, credits can be earned on 4 themes, with the number of credits determining how the losses are spread, i.e. shared savings.
Presentation by Olivier van Noort (only available in Dutch)
With almost 100 participants, we can look back on a very successful autumn symposium.
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