This presentation by Gijs VAN DER VLUGT, Camila VAMMALLE and Claudia HULBERT was made at the 3rd Joint DELSA/GOV Health Meeting, Paris 24-25 April 2014. Find out more at www.oecd.org/gov/budgeting/3rdmeetingdelsagovnetworkfiscalsustainabilityofhealthsystems2014.htm
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DELSA/GOV 3rd Health meeting - Gijs VAN DER VLUGT, Camila VAMMALLE, Claudia HULBERT
1. BUDGETING
PRACTICES FOR
HEALTH
Gijs Van der Vlugt (Dutch Ministry of Finance)
Camila Vammalle (OECD)
Claudia Hulbert (Consultant)
3rd Meeting of the Joint Network on Fiscal Sustainability of
Health Systems
OECD Conference Center, 24-25 April, Paris
2. Country respondents
Answers for 27 countries Provincial
answers
(Canada)
Australia
Austria
Canada
Chile
Czech Republic
Denmark
Estonia
Finland
France
Germany
Hungary
Iceland
Italy
Japan
Korea
Mexico
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
Slovenia
Sweden
Switzerland
Turkey
United Kingdom
British Columbia
Manitoba
Northwest
Territories
Sakatchewan
Quebec
Yukon
3. 1. General issues on budgeting for health
2. Expenditure frameworks and ceilings
3. Bringing efficiency gains back to the budget
4. Leeway and influence of central budget
authority on health expenditure
5. Main co-ordination challenges
6. Conclusion
3
Overview of the presentation
4. 4
A great variety of different budgeting systems for health
Centralised,
National
Health
Systems
Social
Insurance
Systems
Decentralised
Systems
Decentralised,
social insurance
systems
Decentralised,
national health
systems
1. General issues on budgeting for health
5. 5
Most countries use budget ceilings for central
government’s expenditure on health
Use of budget ceilings for health expenditure by central governments
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 45
2. Expenditure frameworks and ceilings
No specific
ceilings for
health
13%
Expenditure
ceilings for
overall
expenditure
by the
Ministry of
Health (or
Social…
Expenditure
ceilings by
program
16%
Expenditure
ceilings by
category of
health services
(e.g. hospitals,
primary care,
etc.)
35%
6. 6
Many countries have developed early warning systems
but delays in reporting expenditure information may
reduce their ability to take corrective measures
Delay in reporting expenditure to CBA
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 49 and 22
2. Expenditure frameworks and ceilings
0 1 2 3 4 5 6
Netherlands
Switzerland
Finland
Austria
Czech Rep.
France
Germany
Mexico
Norway
UK
Australia
Chile
Denmark
Estonia
Hungary
New Zealand
Poland
Slovak Rep.
Slovenia
Korea
(months) None 1 to 2 3 to 6 6 to 12 12 to 24
8%
35%
19%
38%
There is an EWS and sets in motion
required action for future years
There is an EWS and sets in motion
required action for the current year
There is an EWS, but an alert does not
legally require action
No EWS
Existence of an Early Warning
System
7. 7
While most countries produce long-term projections,
these do not always influence policy making or debate
Use of automatic reductions in
health care spending
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 38 and 4
3. Bringing efficiency gains back to the budget
No
72%
Yes but
only on
part of
HCE
28%
YES
44%
NO
56%
Use of spending reviews as a
tool to identify possible cuts in
health care expenditure
8. 8
Share of discretionary vs. mandatory health spending
(average 2006-2012)
0% 20% 40% 60% 80% 100%
Korea
Italy
Germany
Netherlands
Mexico
Finland
Estonia
Switzerland
Austria
Norway
Sweden
Australia
AVERAGE
Slovenia
Slovak Rep.
Iceland
Denmark
Czech Rep.
Japan
New Zealand
Discretionary Mandatory
4. Leeway and influence of CBAs on health expenditure
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 5
9. 9
Top priority areas for health expenditure control for
budget officials
0 2 4 6 8 10 12 14 16 18
Outpatient care spending
Primary health care services
Spending on prevention programs
Long term care spending
Pharmaceutical costs
Hospital expenditure
4. Leeway and influence of CBAs on health expenditure
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 37
10. 10
Influence of the CBA over health care-related policies
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Hospital tariffs Hospital
budgets
Pharmaceutical
prices
Listing of new
drugs
Listing of new
medical
services
Payments to
doctors
Spending on
public health
programs
considerable moderate little none
4. Leeway and influence of CBAs on health expenditure
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 34
11. 11
Number of years with overspending out of the last 7
years
0
1
2
3
4
5
6
7
8
Years out of last 7 with overspending Years out of last 7 without overspending
4. Leeway and influence of CBAs on health expenditure
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 48
12. 12
Size of over- and under-spending in percentage of
budgeted spending, max and min (2006-2012)
-15
-10
-5
0
5
10
15
20
Under/overspendingasashareoftotalhealth
careexpenditure
4. Leeway and influence of CBAs on health expenditure
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 48
13. 13
Perceived co-ordination challenges between the MoH
and the CBA
0
5
10
15
20
25
Sharing of information
between the Ministry of
Health and the CBA
Lack of incentives for
co-operation between
the CBA and the
Ministry of Health
Lack of established
relationships between
officials from the CBA
and the Ministry of
Health
Lack of capacity at the
CBA to assess policies
proposed by the
Ministry of Health
Is a major challenge Is somewhat of a challenge Is not a challenge
5. Main co-ordination challenges
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 26
14. 14
Types of relations between CBA and MoH
0
1
2
3
4
5
6
7
8
9
Specific co-
ordination body
gathering officials
from CBA and
MoH
Regular informal
consultation and
meetings
Ad hoc bodies
created for specific
needs (discussing a
reform, etc.)
Consultation for
budget preparation
only
None
5. Main co-ordination challenges
15. 15
Controlling health expenditure: a difficult but often
successful task
Health is
one of the
top two
policy
areas from
which it is
hardest to
achieve
savings
19%
In general,
it is harder
to achieve
savings in
health
than in
most areas
50%
Health is
as hard as
any other
area of
governme
nt
spending
31%
More
successful
than in
other
areas of
policy
19%
As
successful
as in other
areas of
policy
58%
Less
successful
than in
other
areas of
policy
23%
Perceived difficulty of achieving
savings in health vs. other
expenditure areas
Perceived success in controlling
health expenditure
Source: OECD survey of budget officials on budgeting practices for health, 2013, Q. 42 an 29
6. Conclusion