Improved quality, safety and containing healthcare costs: too good to be true?

Bruxelles – 21 February 2013

Claudio Dario, Director General, Padua Teaching Hospital, Veneto Region, Italy

The effects of the crisis on Italy, as in the other European Countries, are noticeable from multiple factors. In particular:

• growth of public debt• decrease of production and of GDP• increase of unemployment

The current scenario

Growth of public debt

Source: Italian Ministry of Treasure, 2012

Source: Italian Ministry of Treasure, 2012

Public debt / GDP ratio in UE Contries, 2011

Growth of public debt

[source: Eurostat, 2012]

decrease of production and of GDP

The Italian GDP 2007-2011 and forecasts 2012-2013

[Source: The perspectives for italian economy 2012-2013, Italian Bureau of Statistics (ISTAT), 5-nov-2012]

Increase of unemployment

The amount of Unemployed by class of age 1993-2011 (thousands)

Source: Italian Bureau of Statistics (ISTAT), 2012

The amount of Unemployed by class of age 1993-2011 (thousands)

Source: OECD, 2013

But in Italy a good social safety net is in place:

• extensive use of layoffs (“cassa integrazione”)

• unemployment compensations (“sussidi di disoccupazione”)

• family protection network• household wealth

• house of property (the 77,1% of italians live in a house of property*)

• savings and financial activities

The current scenario

[*Source: Survey on savings and financial choices of Italians 2012, Intesa San Paolo, 2012]

Extensive use of Layoffs (“cassa integrazione")

[Source: Italian Bureau of Statistics, ISTAT, 2012]

Household wealth

• Household wealth of italians: 8.619 Billions € on 2011 (almost 4 times the public debt)

• 62,8% of real activities,

• 37,2% financial activites,

• 9,5% financial liabilities.

• 10% of italians owns the 45% of wealth

• the net wealth is almost 8 times the income

[source: Bank of italy, 2011]

Household wealth to income ratio

The Italian National Health ServiceHealth Insurance coverage

Source: “Health at a Glance Europe 2012”, OECD, 2012

• Italy has a tax-funded National Health Service that guarantees universal provision of comprehensive care

• The central government provides a politicy and planning frameworks, defines the Essential Levels of Care and guarantees the financial sustainability

• The regions, through public and private providers, deliver the Essential Levels of Care (sometimes additional to the minimal set defined by the Ministry of Health) and are liable for any deficit

The Italian National Health Service

• In the 2006-2010 period the medium increase rate of expenditure was 2,2%, but in 2001-2006 it was higher: 7%

• The total healthcare expenditure is continuosly increasing: the reduction of the increase of the public funding over the years is compensated by a raising private expenditure

Source: Italian Ministry of Health, 2012

The deficit of the National Health Service

The trend of the deficit of Italian NHS

Bill

ion

€

Year

National trend

Trend for regions with recovery plan

Trend for regions without recovery

plan

Source: Italian Ministry of Health, 2012

The deficit of the National Health Service

85% of the total deficit

The polarization of the deficit of Italian NHS among some RegionsYear 2011 (Million €)

Source: The European House-Ambrosetti, 2012

-815,1

The deficit of the National Health Service• In the 2001-2011 period Regions generated over 40 Billion € of

cumulative deficit

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Public expenditure(Billions €)

77,7 79,5 82,3 91,2 96,8 99,6 103,8 107,1 110,2 111,2 112,9

% on GDP 6,2 6,1 6,2 6,6 6,8 6,7 6,7 6,8 7,3 7,2 7,1

Deficit(Billions €) -3,8 -2,9 -2,3 -6,4 -5,7 -4,5 -3,7 -3,5 -3,3 -2,3 -1,8

• Since 2001, Italian government establishes limits to the increase of public expenditure

• Since 2007, regional recovery plans (Piani di Rientro) are adopted for overspending regions

• On 2010, further policies has been provided by the Ministry to increase traceability, accountability and appropriateness of the Health Service (Patto per la Salute 2010-12)

• 2012: Spending Review

Source: Italian Ministry of Health, 2012

The health expenditure of italian NHS

Source: OECD Data Health, 2012

The areas of action• Reduction of Hospital Beds

• Organization of hospital beds over the territory (Hospital, Elderly Homes, Nursing Homes, etc…) by intensity of care (acute/cronical disease).

• 3.5 Hospital Beds/1.000 inhabitants on 2010 [Source: OECD], where the European Average is 5.5

• Reorganization of the network of Hospital Assistance depending on High Specialty

• Hub & spoke networks, pathology networks, etc…

• Organization of the continuity of care:• Primary care, Home Care, specialistic assistance, palliative care, residential

care, etc...

• Appropriateness of hospital admissions: reduction of the number and of the duration of hospitalizations • Conversion of day-hospital activities to out-patient regimen, and of

hospitalizations to day-hospital activities, with the introduction of co-payment• Activation of week-surgery and development of day-surgery

The areas of action

• The National government cut the transfers to regions for disability, childhood, migrants and other welfare policies

• Introduction of cost-saving measures aimed to reduce pharmaceutical expenditure

• Increase of indirect business tax (IRAP) to finance healthcare system

• Elimination of obsolete Essential Levels of care

Improved quality, safety and containing healthcare costs: too

good to be true?

Thank you!Claudio DarioDirector General,

Padua Teaching Hospital,

Veneto Region, Italy

The health expenditure of italian NHS

Source: OECD Data Health, 2012