The Norwegian Health care System

By Maggi Brigham SINTEF Health Research Dep. of Health Services Research Trondheim Norway

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Facts about Norway

           4.6 million inhabitants Population density 14.2 (population per km2) Urban population 77 % Population > 65 years old 15 % Fertility rate 1.8 births per woman Deaths per 1000 inhabitants/year 9.0 Infant deaths per 1000 live births 3.2 Life expectancy 82.3 years GDP per capita 59 000 USD (PPP 39000) Gini coefficient of income 0.243 3rd largest oil exporter in the world

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Total health care expenditure in Norway Primary and secondary (2004)

 26 billion USD
 Primary 18.5 billion; 4000 USD per person  secondary 7.5 billion USD; 1700 per person

 5700 USD per person, PPP 3907 USD per person  9.9 % of GDP


Johnsen p. 32

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Norway health care administration

Social security The Ministry of Social Affairs
The Directorate for Health and Social Affairs The Norwegian Board of Health The National Insurance Administration The Norwegian Institute of Public Health The Norwegian Medicines Agency The Norwegian Radiation Protection Authority Hospitals

The Ministry of Health Ownership

Health Enterprises

County municipalities

The municipalities

The Municipal Health Service Care - care and rehabilitation Social Services

The general public

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Ministry of Health and Care Services role and responsibility

 Legislation (preparation) and overall planning regarding
         

primary health care specialized health care/hospitals public health mental health medical rehabilitation dental services pharmacies and pharmaceuticals emergency planning and coordination policies on molecular biology and biotechnology food safety

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The Directorate of Health and Social affairs role

 Is a professional body (not political) that the Ministry of Health and Care has delegated authority and responsibility for
 the surveillance of health and social services  Administration of health and social legislation  Implementation of policy

 Both primary and secondary health care

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The Norwegian Medicines Agency

 Is the national, regulatory authority for new and existing medicines and the supply chain.  Is responsible for supervising the production, trials and marketing of medicines.  It approves medicines and monitors their use, and ensures cost-efficient, effective and well-documented use of medicines.  Prevention of over use.  NOMA also regulate prices and trade conditions for pharmacies

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Organisation and financing of hospital services (secondary care) in Norway

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Organisation and financing of hospital services (secondary care) in Norway

 In Norway, the financing and provision of hospital services is mainly the responsibility of the national government, financed by income and wealth taxation.
 But one can also find a growing private contribution in terms of

both financing and provision

 The political responsibility and control of hospital services lies with the Ministry of Health and Care Services, i .e. which is responsible for the overall financing, planning and prioritizing of health services in the country
 Delegated authority to the Directorate of Health and Social Affairs

for implementation and surveillance

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Organisation and financing of hospital services in Norway, contd.

 The Counties used to own, run and finance hospitals (secondary care)
 Transferred to national ownership 2002
  

Coordination Budget control Equalize access

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The Regional Health Authorities

 The responsibility of providing hospital services is delegated to five geographically based Regional Health Authorities (RHA), which are organized as national governmentally-owned enterprises.
 The RHA exercises state ownership and has the responsibility for

providing services to the population in the health region, within the framework stated by the overall health political goals.  The responsibilities also cover specialized mental-health services and hospital services to persons with drug-related health problems.

 The production of hospital services is performed mainly by local Health Authorities (HA) owned by the RHAs or with private, non-profit, hospitals that have a provisional agreement with the RHA. The local HA consists of one or more hospitals. The RHA supplements its own production with purchases from private, for-profit, providers.

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Financing of hospital services

 The major elements in the financing of the RHA are:
 Activity-based financing;  In-patient and out-patiens payment schemes.  Block grants (needs-equalization grants) distributed among the RHAs

according to socio-demographic characteristics (e.g. age-composition) of the population.  Different ear-marked grants.

 There is also out-of-pocket payment (user fees) for out-patient hospital services (but these finance less than 2 % of total costs).  No out-of-pocket payments for inpatient hospital services  RHAs are free to choose their own system to finance their hospitals.
 Most RHAs have chosen to copy the national model combining

population-based grants with activity-based financing

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Private supplement
 In later years, the private supplement of hospital services has become increasingly important.
 The number of private, for-profit, providers has grown.  The range and scale of activities (out-patient and day surgery) has

increased.  The public providers are the major purchasers, but there is also privately financed purchases and a private health-insurance market is emerging.

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The Management System of Primary Health Care in Norway

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1) What is primary health care in Norway rough overview

a) General Practitioners (GPs) b) Care for elderly and disabled c) Health Stations 90 percent of patients are trea

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1 a) General Practitioners (GPs)

TASKS:  Diagnosis  Prescribe medication
 90 % of patients treated here, 10 % referred to specialist/hospital

 Referral to hospital = Gatekeepers ORGANISATION  - private, financed by municipality through agreements

 - Trondheim: 150000 inhabitants (175000 with students) 125 GPs. Average: 1.400 inhabitants per GP.  - Every inhabitant has one GP, by choice or given by authorities if you dont choose.

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1b) Care for elderly and disabled

TASKS:  - nursing homes  - home-based services Large and growing task.

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1c) Health Stations

FOR WHOM: - Children and youth age 0-20. TASKS:  - mother and child care/information  - vaccination programs  - sexual education for youth/ prevent pregnancies

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The municipalities are ordered by national authorities to provide these primary health services to the inhabitants.

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Main laws and directives regarding primary health care

 The most important law regulating the provision of primary health care is the Municipal Health Services Act of 1986
 Defines responsibilities for primary health services and patient

rights

 Also a Directive on Regular General Practitioners

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The Municipalitys role and responsibility

 Municipalities are responsible for
 planning and developing primary health care services to meet the

needs of the residents  Planning primary health services provided by other providers


Agreements with regular General Practitioners (GPs)



Framework agreement between Municipalities Central Association and Medical Doctors association

Agreements with private nursing homes

 Also responsible for emergency services

 Municipalities decide the amount of local public funds to be spent on primary health care

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Municipalitys health care organization

 The chief administrative officer of the municipality is responsible for primary health services  Municipalities are self-governed by local politicians in cooperation with local civil servants and free to set their own local management models  Ombudsman and the County doctor are institutions where patients can file complaints about health services

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2) Who is paying for Primary Health Care?

 About 80-90% from local and central taxes

 10-20% percent fee for services

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2: About local and central taxes

     All inhabitants must pay Controlled by local tax-authorities through employers Progressive system, high income - high taxes Central taxes to the national health insurance system Local taxes to municipality government
 Used for primary health among other things

 Same access to services whether you pay low taxes or high taxes  Basic principle: Pay according to ability, receive care according to need

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3a) GPs financed by:

i) Grant from local authorities depending on how many inhabitants the GP serve (40-50%) ii) Activity based fees from central health insurance administration (NIS). Based on number of consultations and diagnostic tests. (30-40%) iii) Out of pocket fee from inhabitants (10-20%) - Children do not pay - Upper limit for out of pocket payment (chronic diseases)

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User charges in primary health care in Europe

General practitioner
______________________________________________________________________________________________________

Austria Belgium Denmark Finland France Greece Ireland Italy Netherlands Norway Portugal Spain Great Britain Sweden Germany

Free (80% of the population) 8% - 30% Free 16,8 Euro 30% Free in NHS (not in private) Free for the poor, 19 Euro for the rich Free Free (not for the rich?) 16 - 25 Euros (with roof) 1,5 Euros Free Free 8 - 17 Euro Free (?)

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3b) Care for elderly and disabled

Nursing homes financed by: - Grant from local authorities, negotiated every year (8090%) - Out of pocket payment (10-20%) Home based health services financed by: - Grant from local authorities, negotiated every year. - (No fee for service)

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3c) Health Stations financed by:

 Grant from municipality  (No fee for service)

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Summary Primary and Secondary (hospital) care

 Two separate management and financing systems in health care
 Primary health: (Local) Municipality planning, implementation and

financing (+ NIS)  Secondary health:

 

(National) state responsibility and financing Health enterprises planning and implementing

 Primary health care: small out-of-pocket payment (>12 y)

 Consultations, procedures, medicines  roof

 Secondary health care:

 Inpatient totally free for everyone  Outpatient: small out-of-pocket payment

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The Norwegian National Insurance Scheme with Focus on Health Insurance

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The Norwegian National Insurance Scheme (NIS)

 The NIS is a public universal insurance scheme that assures everybody social security and health insurance, regardless of income  Introduced in 1967

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History

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Chronology
 Public accident insurance introduced in 1894  Public unemployment insurance introduced in 1906  After many failed attempts since 1884, the law on public health insurance was adopted by the parliament in 1909.
 Implemented in 1911

 Public old-age pension scheme introduced in 1936  The National Insurance Scheme (NIS) established in 1967
 First social security

 Health insurance incorporated into the NIS in 1971

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These public health insurances were introduced while Norway was a relatively poor country (before we found oil)
A political project of welfare distribution

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Health insurance membership

 1911: Compulsory membership for workers
 361 000 members in 1912  Workers and their family

 Universal in 1956
 Workers (as before)  Self employed  Farmers  Fishermen  Tradesmen  Unemployed

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Membership in public health insurance

% of workforce % of population

1915

38

15

1950

72

31

1970

178

72

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Health Insurance Coverage

 Sick pay, doctor consultations and hospital treatment
 

Not dental health (still) Not medicine (now partly)

 Midwives and maternity light in 1912

 Now more comprehensive

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Cost sharing of health insurance

1911 Member Employer Local Municipality National Government Total 60 % 10 % 10% 20 % 100 % 1956 49.5 29.7 10.9 9.9 100 % 1972 33.6 % 50.4 % 9.1 % 7.9 % 100 %

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Revenue collection
 First: premiums paid like normal insurance premiums  1971: incorporated into NIS, Premiums replaced by tax (see below)

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Today

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Membership today
 All persons who are either residents or working as employees in Norway MUST be insured under the National Insurance Scheme.
 Also certain categories of Norwegian citizens working abroad  Others can apply for voluntary membership

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Members of NIS are entitled to

 Free stay and treatment in public hospitals  Partial coverage of treatments by
 GPs  Out-patient specialists  Psychologist/psychiatrist  Certain drugs  Transportation to examination/treatment

 Children under 12 are exempt from cost sharing (out of pocket payments)

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Members also entitled to

Retirement pension Disability pensions Benefits for single parents Cash benefits in case of sickness, maternity and unemployment  Medical benefits in case of sickness and maternity  Funeral benefits    

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Health care expenditure by NIS

 NIS gross budget: USD 35 700 million
 7.800 USD per inhabitant

 Health care expenditure by NIS USD 3 125 million  Health care expenditure almost 10 % of total NIS spending

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Financing of the NIS

Central income tax to the  Employees: rate varies, first 3.2 %, now 7.6 % of income
 Employers  Self-employed people  Controlled by local tax-authorities through employers  Same access to services no matter how much tax you pay

 Allocations from National Government Budget

 In the beginning large proportion, as people got richer smaller

proportion of total budget

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NIS funds partly finance these aspects of Health Care:

    Regular general practitioners (GPs) Emergency ward Private specialists/outpatient hospital services Pharmaceuticals from pharmacies

Johnson p. 37

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The NIS is administered by

 National Insurance Administration
 Subordinate to Ministry of Labor and Social Inclusion

 Tax authorities
 premium collection

 Municipal welfare offices

 Pays claims to individuals, GPs, Outpatient services

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Summary
 Norwegian Health care mainly publicly managed and financed  Two separate management and financial systems for primary care and hospitals
 Primary care: municipality  Hospitals: national government

 GPs gatekeepers to hospitals  National Insurance Scheme.

 Tax from Employers, employees. Municipal and national govt grant  Basic principle: pay according to ability & receive care according to

need

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