Chapter 2

directly and indirectly: allowing consumers more choice (full freedom to choose their
own health insurer and, in most cases, their health provider) and giving a more active
role to insurers (representing patients’ interests). The new health insurance scheme
has a private structure. Citizens will no longer be insured automatically but will be
obliged to purchase a health plan themselves. The integration of the social and private
insurance schemes implies that the coverage of the old public scheme will be
extended to the whole population (standard package of essential health care). The
level of the nominal insurance premium differs between insurers (range in 2006: €
990-€ 1.172 per year), as an incentive for competition among the health insurers and
for cost consciousness among the insured. Indeed an unexpected 25% of insured
changed over to a new health insurer at the introduction of the new system in
January. This was also triggered by discounts on the premiums offered to employees
in the context of collective contracts between employers and insurers. Furthermore,
health care insurers do not have to sign individual contracts with all providers. By
abolishing this, the provision and the price of health care can be negotiated at the
level of insurer and supplier. Health care providers compete with each other on the
basis of price and quality. Some health insurers offer 2 insurance policies: one with
limited freedom to choose one’s provider but with no charge to the insured and one
with complete freedom with reimbursement to the insured, the latter policy being
more expensive than the former.
2.5.2 A new hospital financing system
As the old system of fixed budgets for hospitals was not compatible with the model
of regulated competition and consequent negotiation about prices of health care services
a new system for hospital finance was introduced as well. The hospital production
can be seen as built up from a large number of Diagnosis Treatment Combinations
(in Dutch: Diagnose Behandeling Combinaties, DBCs), a kind of DRG-system. A DBC
is defined as the whole set of activities and interventions of the hospital and medical
specialist resulting from the first consultation and diagnosis of the medical specialist
in the hospital. Expert opinion was used to define DBCs an estimate duration of each
procedure, on which basis an initial price was determined. The total number of DBCs
is huge (about 29.000). Clearly it is impossible for the hospitals to compute costs for
all DBCs and then negotiate about the level of reimbursement with health insurers.
Two strategies are implemented to reduce the impact of the transition to the DBCsystem.
First, negotiation on prices for DBCs is introduced step by step. At the
moment the price is fixed for most DBCs, but prices for a specific set of DBCs (about
10% of hospital production, mostly non acute care) are subject to negotiation
between hospitals and health insurers. The set of DBCs subject to free pricing is to be
extended over successive years. Second, it has been recognized that a small part
(about 20%) of the DBCs determines a large part of the volume of resource use and
the costs (about 80%). For that reason health insurers and hospitals can limit their
negotiations to a subset of all DBCs. For that purpose the DBCs were categorized into
3 to 61 homogeneous product groups per professional area.
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CEIS Health Report 2006