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«The management of health systems in the EU Member States - The role of local and regional authorities The study was written by Progress Consulting ...»

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Delivery of the services Insurance provides access to a wide range of services, from inpatient to outpatient care, medicines (upon prescription), rehabilitation, spa treatment and some dental care. Individuals are free to choose the fund and the doctor to register with. There is no gate-keeping system, thus specialist care may also be accessed freely. Most (95%) of the services provided at primary care level are from professionals working in private practice, although they occasionally rent facilities in health centres or polyclinics. Secondary care is provided through health care centres (generally owned by municipalities), polyclinics, hospitals, specialised centres or private professionals. The ownership and management of hospitals is undertaken by a different range of actors, from the state to regions and municipalities, private entities and churches. Public hospitals account for more than two thirds of the total number of hospitals (in 2008, out of 192 acute hospitals, 25 were owned by the state, 66 by the regions, and 28 by the municipalities).

Pharmacies are almost entirely (99%) privately owned and run, apart from those belonging to publicly owned hospitals. The State Institute for Drug Control, under the Ministry of Health, is responsible for pricing and reimbursement of registered medicines.

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Finance and health care expenditure Public expenditure contributes the major part of total health expenditure (85.8% in 2007). Its main sources are social health insurance contributions, comprising mandatory contributions from payroll tax (split between employees and employers) and from the self-employed (on the basis of their profit); and state contributions on behalf of the economically inactive. Other sources of public expenditure, accounting for 7.4% of total health expenditure in 2007, are from state, regional and municipal budgets. These budgets are financed through general taxation (VAT, income and wealth taxes, and excise duties), mainly for capital investments in facilities or subsidies.

In 2007, private expenditure accounted for 14.2% of total health expenditure. Its main sources include upfront payments for co-payments on services and medicines or for the purchasing of over-the-counter pharmaceuticals. Voluntary health insurance has a small market.


Bryndová L. et al. (2009), Czech Republic: Health System Review. Health System in Transition, European Observatory on Health Systems and Policies DENMARK Main characteristics of the Danish health care system ►Decentralised, with a significant role played by regional and local (municipal) authorities, the latter also in financial terms ►Providing universal coverage free of charge at the point of service ►Mainly public financing of health care – out of national and local taxation ►Mostly public service provision Structure of the system At the central level, the Ministry of Health and Prevention is responsible for health policy and legislation. It also develops national guidelines for health care provision, monitors and facilitates exchange of experience and information, and administers economic incentives and activity-based payments.

The 5 regions are responsible for the running of hospitals and the administration of primary health care, with the possibility of arranging service provision according to regional requirements and facilities, although always within an overall, centrally-set framework. The 98 municipalities have several responsibilities in the field of health, from public health care, with the local administration of the primary health care service, to home nursing, prevention and rehabilitation, as well as financing. They are also responsible for most social services, including support to the elderly.

Delivery of services General practitioners act as gate-keepers to secondary care, so a referral is necessary for hospital treatment and treatment by specialists, but not for emergency care. Any person above the age of 16 has the right to decide to belong to either ‘Group 1’ or ‘Group 2’ patients. The default group, to which most of the population belong (98.5% in 2007), is ‘Group 1’; people are free to choose a GP working within 10 km of their house;

they have free access to general preventive, diagnostic and curative services.

Belonging to Group 2 enables the person to consult any GP and any specialist without referral; incurred expenses will be subsidised by the public system up to the equivalent cost of a Group 1 patient, the rest being at the expense of the Group 2 individual. Most health professionals are self-employed and paid by the regions according to collective agreements between the regions and the unions of professionals.

Secondary care is delivered through hospitals, most of which are owned and operated by the regions. Hospitals with highly specialised departments may be used by patients of other regions, on the basis of interregional agreements whose aim is to make specialised hospital treatment available to all. Regions may also refer patients to treatment abroad and pay for it. If the waiting time for treatment exceeds one month, patients have the right to be treated in a private hospital or abroad. Private hospitals, especially specialised ones, are used through the public system on the basis of agreements with the regions.

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Finance and health care expenditure Public health services are financed through a health care contribution tax that corresponds to 8% of taxable income. At the regional level, funding from the central level is complemented by resources raised locally. Most of the finance is from a State Block Grant (some 77% of the total); the central level contributes also with a State Activity-related Subsidy (3% of the total) intended to incentivise activities within hospitals. The remaining 20% of the total financing of health care is raised locally through a basic contribution (8%) and an activityrelated contribution (12%) (Kvist, 2010). The basic contribution is a lump sum charged to each citizen and determined by the region; the activity-related contribution depends on the level of use by citizens of the regional health services, and is thus related to hospitals and general practice. Some 50% of the activity-related contribution is re-distributed by regions to hospitals.

Public health expenditure represents 84% of total health expenditure, the rest being private expenditure as upfront payments for medicines and dental care.


- Ministry of Health and Prevention (2008), Health Care in Denmark.

- Kvist J. (2010), Annual National Report 2010 – Pensions, Health and Long-term Care:

Denmark. ASISP: Analytical support on the Socio-Economic Impact of Social Protection Reforms.

ESTONIA Main characteristics of the Estonian health care system ►Central responsibility, with provision of services devolved to private entities that may be partially or wholly owned by the public administration (state or municipalities) ►Wide coverage (95%) through a mandatory, solidarity-based insurance ►Mainly public financing – out of earmarked taxation through mandatory health insurance contributions ►Service provision has been mostly privatised, i.e. delegated to autonomous individuals or private legal entities such as limited liability (profit-making) companies or (no-profit) foundations Structure of the system The health care system is administered by the Ministry of Social Affairs. The organisational structure of the system consists of several bodies including, among others: various agencies under the Ministry for Social Affairs; the Estonian Health Insurance Fund (EHIF), as an independent, public legal entity; private primary care units and hospitals established as limited companies or foundations, but mostly owned or controlled through supervisory boards by local governments; and various non-governmental organisations and professional associations.

Responsibilities for the financing and management of public health services are at the central level. The Ministry for Social Affairs, structured into four main departments (Health Care, Public Health, Health Information and Analysis and eHealth), is responsible for health and health care policy formulation, regulation, planning, and monitoring, as well as regulation and funding of ambulance services and emergency care services for uninsured people. The EHIF (Haigekassa) is accountable to the Ministry of Social Affairs through the chair of its Supervisory Board. The Board is the governing body of the Fund, including 15 representatives of state, employer and insured individuals’ organisations: it approves 4-year development plans, annual budgets, reports and criteria for the selection of health service providers. EHIF has implementation responsibilities as it collects and distributes funds, contracts the health service providers (as the main purchaser), pays for health services, reimburses pharmaceutical expenditure, checks the quality of the services provided and pays out benefits. At county level, county governments, representing the state regionally, are responsible for the planning, supervision and administration of primary care within the county.

The role of local authorities (municipalities) in the organisation and financing of health services is mostly on a voluntary basis as from 2001 they are no longer obliged to fund or provide health care services but, for example, some municipalities continue providing partial reimbursement of medicines and nursing care to low income households and the elderly.

Health care provision has been almost entirely privatised and delegated to autonomous providers, whether these be individuals or private legal entities such as limited liability (profit-making) companies or (non-profit) foundations. Both the state and municipalities may own and manage these entities that are, in this case, considered to be public institutions. Additionally, since 2008, an amendment to the Health Services Organisation Act allows municipalities to establish or own family practices. Family doctors are private entrepreneurs or employees of private companies providing primary care services.

The health insurance system is mandatory for all residents; it covers some 95% of the population. Insured people receive cash and in-kind benefits from EHIF, such as maternity and sickness benefits, other allowances or partial lump sum reimbursements for dental care (cash benefits); or preventive and curative health services (in-kind benefits) that may, however, be subject to co-payments.

Delivery of services Primary care is delivered through family doctors, who are required to work together with at least one nurse; the service area of each family doctor is determined at the county level. Citizens are free to choose the family doctor to register with; family doctors function as entry points to secondary care even if some specialist care can be accessed without referral.

Specialist and hospital care (both secondary and tertiary care) are legally separated from primary care. The hospital network is organised at different levels or types of hospitals. At the end of 2006 there were 55 hospitals, including: 18 local and general small hospitals, usually at least one per county, providing ordinary treatment care; 4 central hospitals with up to 200,000 catchment inhabitants; 3 regional hospitals with up to 500,000 catchment population; 7 small specialised hospitals; 3 rehabilitation hospitals; and 20 nursing care hospitals located in major towns or county centres. Most of the hospitals are managed or owned by public authorities (the State or local authorities).

Emergency medical care is provided through ambulance services countrywide.

Medicines may only be distributed through privately-owned pharmacies, most of which belong to pharmacy chains. Pharmaceutical policy is the responsibility of the Ministry of Social Affairs, which is also involved in planning, pricing and reimbursement decisions, while the State Agency of Medicines is responsible for permits, medicines classification and supervision.

Finance and health care expenditure Health care is mainly funded through EHIF contributions in the form of earmarked social payroll tax paid by salaried and self-employed workers, making the revenue dependent on the contribution of the employed only. Since the other categories are ‘subsidised’ by the active workforce, the system is considered to be based on a strong component of solidarity.

Other public sources of health care financing from general taxes include state (from the Ministry of Social Affairs for the emergency care of uninsured people, ambulance services and public health programmes) and municipal contributions, covering, in 2006, 9.4% and 1.8% of total health care expenditure, respectively.

One quarter of all expenditure is private, mostly represented by upfront payments for pharmaceutical co-payments and dental care and, to a lesser extent, the undertaking of voluntary health insurance.


- European Federation of Public Service Unions website

- Koppel A. et al. (2008), Health Systems in Transition, Vol. 10 No.1, Estonia: Health system review, European Observatory on Health Systems and Policies

- Võrk A. et al. (2010), Annual National Report 2010 – Pensions, Health and Long-term Care: Estonia. ASISP: Analytical support on the Socio-Economic Impact of Social Protection Reforms FINLAND Main characteristics of the Finnish health care system ►Highly decentralised, with an important role played by local authorities (municipalities) ►Providing coverage through a compulsory health insurance system for all citizens ► Prevailing public financing of health care – out of general taxation, including municipal taxes, and National Health Insurance ►Mixed service provision because of different arrangements pursued by municipalities in purchasing/providing the services Structure of the system At the central level, the Ministry of Social Affairs and Health is responsible for health policy and the setting of broad development goals. The legislative framework is also set at the national level and there are several programmes undertaken by the central authorities to support local and regional development as well as the restructuring of the health system by encouraging merging and partnering among municipalities for a more effective delivery of services.

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