Governance and finance of long-term care - University of Birmingham
Governance and finance of long-term care - University of Birmingham
Governance and finance of long-term care - University of Birmingham
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Allen et al., 2011 <strong>Governance</strong> <strong>and</strong> Financing <strong>of</strong> LTC | European Overview<br />
so called <strong>care</strong> <strong>of</strong>fices have – for <strong>long</strong>-‐<strong>term</strong> <strong>care</strong> – a contracting role in a region, where there is some<br />
competition between providers. The health <strong>care</strong> insurers are contracting for their enrollees. Within a<br />
region more insurers operate. In many cases the dominant insurer has the position <strong>of</strong> a monopsony.<br />
From 2013 both functions are combined <strong>and</strong> connected to the health <strong>care</strong> insurers. In France, local<br />
authorities which are responsible for regulating LTC show a great diversity regarding how competition,<br />
between non-‐pr<strong>of</strong>it <strong>and</strong> for-‐pr<strong>of</strong>it providers, is embedded into local policies.<br />
In other countries, competition between existing, but also new providers has been encouraged by<br />
granting those in need <strong>of</strong> <strong>care</strong> with cash benefits or individual budgets (AT, DE, UK, FR, IT, SI, NL)<br />
whereby users themselves become the purchasers <strong>of</strong> <strong>care</strong>. This type <strong>of</strong> funding bestows purchasing<br />
power on service users (Nies et al., 2010: 49) <strong>and</strong> it is meant to enhance user choice <strong>and</strong> responsiveness<br />
<strong>of</strong> providers to their needs. With regards to questions <strong>of</strong> equity this type <strong>of</strong> competitive mechanism has<br />
been seen to overcome social class inequalities, compared to interventions involving service users’<br />
‘voices’, which tend to favour the articulate middle class (Le Gr<strong>and</strong>, 2007). However, in practice, in<br />
numerous countries this approach is seen to lead to the emergence <strong>of</strong> a ‘grey’ market <strong>of</strong> <strong>care</strong> delivered<br />
by migrant <strong>care</strong>rs (Di Santo & Ceruzzi, 2010). Moreover, misuse <strong>of</strong> the budgets for other purposes <strong>and</strong><br />
fraud has also become an issue, for instance in the Netherl<strong>and</strong>s.<br />
Several factors can impede the success <strong>of</strong> managed competition within LTC. In Greece where LTC does<br />
not exist as a defined sector, there has been an ongoing power struggle between the public <strong>and</strong> private<br />
health <strong>care</strong> sectors, most prominently characterized by the creation <strong>of</strong> the National Health System (ESY)<br />
in the 1980s to arrest the growth <strong>of</strong> the private sector . Although reforms <strong>of</strong> 2001 introduced a new<br />
paradigm <strong>of</strong> mixed market managed competition, this conflict <strong>of</strong> status (due to public underfunding)<br />
between public <strong>and</strong> private health <strong>care</strong> sectors continues to undermine the potential for <strong>long</strong>st<strong>and</strong>ing<br />
collaborative relations – a necessary condition for this governance model – <strong>and</strong> equal access. To<br />
illustrate this latter point, it has been seen that public health services are disproportionately used by<br />
those with low incomes (older people, migrants <strong>and</strong> the unemployed), whilst those who can afford to<br />
pay or have private insurance tend to use the private sector (working age population). It may also<br />
explain how the number <strong>of</strong> nursing homes in the Netherl<strong>and</strong>s could so rapidly exp<strong>and</strong> after the<br />
Exceptional Medical Expenses Act was introduced. This Act was incorporated in a health <strong>care</strong> context<br />
<strong>and</strong> provided a m<strong>and</strong>atory insurance for expenses that could not be covered by a regular insurance<br />
system.<br />
The cultural dominance <strong>of</strong> medical services forms another barrier to developing a managed market for<br />
LTC. This is especially relevant where there is also underfunding <strong>of</strong> public services. Priority-‐setting for<br />
public expenditure, as well as the incentives for developing services in the private sector, are strongly<br />
focused on acute <strong>and</strong> medical services. Where there is little knowledge <strong>of</strong> the role or services involved<br />
within LTC for older people, dem<strong>and</strong> is less visible, hindering the development <strong>of</strong> such services in all<br />
sectors. INTERLINKS data suggests that this lack <strong>of</strong> awareness <strong>of</strong> the social <strong>care</strong>-‐based aspects <strong>of</strong> LTC for<br />
older people is a fundamental barrier to service development (SK, EL).<br />
Further disincentives come in the form <strong>of</strong> unequal legal status for public <strong>and</strong> private providers <strong>of</strong> LTC. In<br />
Slovakia private providers find it very hard to compete with the publically provided services which were,<br />
until March 2011, subsidised by the local <strong>and</strong> regional governments (Example 1, appendix 3). It is noted<br />
that even though these private services are <strong>of</strong>ten more flexibly designed to meet client needs they<br />
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