Market-oriented health care reforms and policy learning in the Netherlands

In this article we analyze the evolution of market-oriented health care reforms in the Netherlands. We argue that these reforms can be characterized as policy learning within and between competing policy programs. Policy learning denotes the process by which policy makers and stakeholders deliberately adjust the goals, rules, and techniques of a given policy in response to past experiences and new information. We discern three distinctive periods. During the first period (1988-1994), the prevailing corporatist and etatist policy programs were seriously challenged by the proponents of a new market-oriented program. But when it came to political decision making and implementation, the market-oriented program soon lost its impetus because it was technically too complex and could not provide short-term solutions to meet the urgent need for cost containment. During the second period (1994-2000), the etatist program regained its previously dominant position. In parallel to a strengthening of supply and price controls, however, the government also persevered in creating the technical and institutional preconditions for regulated competition. Moreover, public discontent over waiting lists and the call for more autonomy by individual providers and insurers strengthened the alliance in favor of regulated competition. This led to the revival of the market-oriented program in a 2001 reform plan. We conclude that the odds of these new post-2001 reforms succeeding are substantially higher than in the first period due to the technical and institutional adjustments that have taken place in the past decade.     

Why some market reforms lack legitimacy in health care

Market-oriented health policy reforms in the 1980s and 1990s generally included five kinds of proposals: increased cost sharing for patients through user fees, the separation of purchaser-provider functions, management reforms of hospitals, provider competition, and vouchers for purchasing health insurance. These policies are partly derived from agency theory and a model of managed competition in health insurance. The essay reviews the course of reform in five countries that had a national health service model in place in the late 1980s: Italy, New Zealand, Spain, Sweden, and the United Kingdom. Special consideration is given to New Zealand, where the market model was extensively adopted but short lived. In New Zealand, surveys and polls are compared to archival records of reformers' deliberations. Voters saw health care differently from elites, and voters particularly felt that health care was ill suited to commercialization. There are similarities across all five countries in what has been adopted and rejected. Some market reforms are more legitimate than others. Reforms based on resolving principal-agent problems, including purchaser-provider splits and managerial reforms, have been more successful, although cost sharing has not. Competition-based reforms in financing and to a lesser extent in provision have not gained legitimacy. Most voters in these countries see health care as different from other parts of the economy and view managerial reforms differently from policies that try to make health care more like other sectors.     

The unintended consequences of New Zealand's primary health care reforms

In 2001, the New Zealand government commenced a program to reform the organization of publicly funded primary care services. While there have been several positive results of this reform, including the reduction of patient co-payments and the extension of the range of primary care services, the government's program was a hastily implemented attempt to place primary care, the delivery of which is dominated by private doctors, under firm state control. It was also an attempt to override preexisting arrangements. As such, the government succeeded in its goal of establishing new primary health organizations (PHOs), but there were also significant unintended consequences. As detailed in this article, these consequences include (1) the creation of a labyrinthine funding and organizational system with a variable capacity to deliver on the government's reform objectives, (2) an increase in the power and scope of preexisting doctor organizations combined with a government unable to wrest control over the setting of patient co-payment levels, and (3) an emerging lack of clarity about future directions for the primary health care sector.     

Health care financing reforms in Germany: the case for rethinking the evolutionary approach to reforms

Health care reform has been a perpetual issue in German politics since reunification. Reform initially focused on restructuring the health care system of the former East Germany. It has subsequently focused on questioning whether the financing of the German social health insurance (SHI) system is sustainable, in light of economic malaise that characterized the 1990s and heightened global competition. In this article, we document twelve significant attempts to reform health care financing in Germany and critically appraise them according to the principles of solidarity and subsidiarity on which SHI systems were built. While the reforms in the aggregate offered the prospect of addressing the challenges faced by the system, the modest results of the reforms and remaining deficiencies of the system underscore the limitations of the evolutionary approach to reforms. This suggests that reformers should consider a more revolutionary approach.     

The politics of management in health care: a British perspective

This paper discusses the contribution of organizational political perspectives to a better appreciation of policy implementation problems in health care. The context is the efforts of successive British governments to accord a higher priority to community health and long-stay services. The limited success of these policies owes much to continuing medical control of the philosophy of the organization and agenda, in spite of government responsibility for funding and providing health services. More effective policy implementation depends on a recognition of the "naturalness" of organizational politics, rather than treating them as constraints in an otherwise rational, managerial system.     

The role of competition in health care: a Western European perspective

The Federal Trade Commission and Department of Justice 2004 report Improving Health Care: A Dose of Competition expresses a clear allegiance to competition as the organizing principle for health care. In Europe, by contrast, the key organizing principle of health care systems is solidarity. Solidarity means that all have access to health care based on medical needs, regardless of ability to pay. This is not to say that competition is not important in Europe, but competition must take place within the context of solidarity. This article critiques the report from a European perspective, describes the role of competition in Europe (focusing in particular on European Union law), and suggests that the United States could learn from the European perspective.     

Public capabilities and health care effectiveness: implications from a comparative perspective

This article examines inter-relationship between "centers" and "peripheries" within political, professional and health care systems. It seeks to determine which conditions tend to improve the capacity of public authorities to further such measures of effectiveness as access to, quality of, and complementarity of health care delivery. Examples are selected from the experience of the United States and West European countries.     

Foul weather friends: big business and health care reform in the 1990s in historical perspective

Existing accounts of the Clinton health reform efforts of the early 1990s neglect to examine how the change in big business reform interests during the short period between the late 1980s and 1994 might have altered the trajectory of compulsory health insurance legislation in Congress. This article explores evidence that big employers lost their early interest in reform because they believed their private remedies for bringing down health cost inflation were finally beginning to work. This had a discouraging effect on reform efforts. Historical analysis shows how hard times during the Great Depression also aligned big business interests with those of reformers seeking compulsory social insurance. Unlike the present case, however, the economic climate did not quickly improve, and the social insurance reform of the New Deal succeeded. The article speculates, therefore, that had employer health expenditures not flattened out, continuing and even growing big business support might have neutralized small business and other opposition that contributed heavily to the failure of reform. Thus in light of the Clinton administration's demonstrated willingness to compromise with business on details of its plan, some kind of major reform might have succeeded.     

Private credentialing of health care personnel: an antitrust perspective. Part One

This Article explores the antitrust and other implications of private credentialing and accrediting programs in the health care industry. Although such programs are usually sponsored by powerful competitor groups, they serve the procompetitive purpose of providing useful information and authoritative advice to independent decision makers. Part One examines the risk that credentialing will sometimes be unfair to competitors and deceive consumers. Its survey of common-law, antitrust, and regulatory interventions to correct such unfairness and deception seeks to determine the degree of oversight to which credentialing and similar activities have been and should be subjected. In recommending that judicial or regulatory scrutiny should be limited to discovering whether standards and practices have a rational relation to a procompetitive purpose, the Article argues that greater intrusion into credentialing schemes would be inconsistent with market theory and first amendment values and would discourage line-drawing efforts that stimulate competition and facilitate consumer choice. By emphasizing throughout that personnel certification and institutional accreditation embody ideology and opinion as well as factual information, Part One sets the stage for the argument in Part Two that antitrust law can and should be used to contest the dominance of a single ideology of health care and to facilitate the development of alternative sources of consumer information. The Article's overall thesis is that, whereas the quality of advice given to the public about health care personnel and similar matters should not be closely regulated, neither should the supply of competing information and opinion be artificially curtailed.     

State Medicaid managed care enrollment: understanding the political calculus that drives Medicaid managed care reforms

The objective of this article is to understand the political motivations underlying Medicaid managed care reforms by examining the determinants of enrollment of beneficiaries in managed care plans in the fifty states. To highlight the role of the model variables, including measures of the political environment, public interest, and special interests, a distinction is made between capitated and fee-for-service managed care enrollment. The results show that cost containment within the context of the Medicaid program is perceived as strongly favored by voters. Accordingly, the relative cost and tax price of providing Medicaid services are important factors in states' decision to enroll Medicaid beneficiaries in managed care plans, particularly capitated ones. The results also indicate a surprisingly significant influence by labor unions that generally oppose managed care enrollment for fears of lost jobs. The recipient population and provider groups also play an important role in shaping the Medicaid managed care landscape. The influence of variables measuring states' ability and willingness to pay and median voter preferences suggest that, within the context of Medicaid managed care enrollment, the public's interests are being served; however, the results also point toward inequities within the program and implications concerning financing arrangements between states and the federal government.     

Rationing health care: it's a matter of the health care system's structure

The article examines two primary policy proposals for how the U.S. should allocate its limited health care dollars: a centralized model in which a commission establishes rationing guidelines, and a decentralized model in which rationing decisions are made by health care providers on a case by case basis. The author finds significant advantages with each position, leading the author to assert that a combination of each is key to an effective rationing policy: a centralized control of structure coupled with decentralized physician-level decision making. While mindful that formal rationing guidelines alone are unfeasible to effectuate cost-effective care, the author introduces two decentralized policies to control costs: the limitation of resources at physicians' disposal and elimination of physicians' personal incentive to provide high-cost care.     

AIDS-related risks in the health care setting: HIV testing of health care workers and patients

Do patients and health care workers have the legal right to know each other's HIV status? Professor Flanagan argues that they do not. Given that with appropriate precautions the risk of transmitting HIV in the health care setting is extremely small and that the discriminatory consequences of HIV disclosure can be extremely high, it is suggested that the right of a patient or a health care worker not to disclose their HIV status must outweigh the other's "right to know."     

Rationing care in the community: engaging citizens in health care decision making

This article examines the theoretical and practical logics of community engagement exercises in health care rationing. To evaluate such exercises in Canada, it is necessary to compare suspected rationing exercises (such as those in Nova Scotia and Saskatchewan) with clear examples of rationing. The Oregon Medicaid reform process is considered an important example of transparent and community-level rationing from which Canadian executive-driven governments can learn a few valuable lessons. While the Oregon experiment seems to have been a (qualified) success, in the Canadian context, formal citizen participation in decision making might be incompatible with social rights and present an incongruous and antagonistic pairing of executive and popular sources of authority.     

Commons ignorance: the failure of environmental law to produce needed information on health and the environment

One of the most significant problems facing environmental law is the dearth of scientific information available to assess the impact of industrial activities on public health and the environment. After documenting the significant gaps in existing information, this Article argues that existing laws both exacerbate and perpetuate this problem. By failing to require actors to assess the potential harm from their activities, and by penalizing them with additional regulation when they do, existing laws fail to counteract actors' natural inclination to remain silent about the harms that they might be causing. Both theory and practice confirm that when the stakes are high, actors not only will resist producing potentially incriminating information but will invest in discrediting public research that suggests their activities are harmful. The Article concludes with specific recommendations about how these perverse incentives for ignorance can be reversed.