News
07-04-2010

Health systems in transition: The Netherlands

The health care system in the Netherlands is in transition. A health system review by NIVEL in collaboration with the National Institute for Public Health and the Environment (RIVM) for the European Observatory on Health Systems and Policies, shows how a structural health care reform in 2006 introduced completely new regulatory mechanisms and structures to the Dutch health care system.


 
After almost two decades of attempts to merge the dual system of sickness funds and private insurers, a structural health care reform in 2006 introduced completely new regulatory mechanisms and structures to the Dutch health care system. The reform introduced a social health insurance system, in which multiple private health insurers compete for insured persons. Health insurers act as purchasers of care and negotiate with providers on price, volume and quality of care; they are allowed to make a profit and pay dividends to shareholders. They are obliged to accept all new applicants for insurance and are not allowed to differentiate their premiums towards the risk profile of the applicants. The government changed its role from directly steering the system to safeguarding the process from a distance. Responsibilities have been transferred to insurers, providers and patients. New “watchdog” agencies in the health sector are put in place to avoid undesired market effects in the new system. The reforms are still ongoing; many of the measures introduced since 2006 have sought to make the transition from the old to the new system as smooth as possible and aimed at the proper functioning of the health markets. In addition, new measures are adjusted if in practice problems arise in their implementation, as seen with for instance the new financing system in Dutch hospitals.

Challenges
This reform has implied fundamental changes in the roles of patients, insurers, providers and the government. Health insurers are expected to negotiate keenly with providers and purchase efficient care of good quality, and patients are expected to critically assess and select the health insurer and provider of their choice. In this transition process it seems pivotal that all players receive the appropriate tools to assume these roles. Important challenges remain: patient information on price and quality should be continuously improved; quality has to be made visible and measurable; transparent pricing systems for GPs and hospitals should be established; negotiating room for health insurers and providers should be widened; and the negotiation process should be optimized and shortened. The latter is important as negotiations often take until summer of a given year whereas the nominal premiums are set on 1 January. Furthermore, constant refining of the risk-adjustment system is needed to eliminate perverse incentives for insurers and to ensure fair competition.

Managed competition
Through these reforms, managed competition for providers and insurers became a major driver in the Dutch health care system. The government presumes that this will increase efficiency and quality in the health care system as well as make care more demand-driven. Achieving these goals seems important for the Dutch health system and its insured; at the time of writing (late 2009), the Dutch health system is an average performer in terms of quality and efficiency when comparing some important indicators to other wealthy countries. The future will have to tell whether the introduction of managed competition in health care is the right means to achieve the overall goals of the Dutch health care system with regard to quality, affordability and accessibility of care.

The health system review was supported by the Dutch Ministry of Health Welfare and Sport.