1. 1 National Health Insurance in Taiwan – Part III Topics : 1. 1.Is the National Health Insurance (NHI) system effective ? 2. 2.Are the NHI improvement measures effective? Group members: Jodie KWONG (04427778G) Lawrence CHAN (04703452G) Phiona SO (04726717G) Remus Au (04726219G) Vicky LAM (04727185G)

2. 2 Presentation Outline   Different elements in the NHI system analyzed based on Evaluation Model – 1. 1.Equity and Capacity 2. 2.Cost effectiveness 3. 3.Cost containment 4. 4.Quality 5. 5.Risk pooling 6. 6.Sustainability   Evaluation of improvement measures mentioned in Part II of presentation.

3. 3 1. Equity & Access 1. Equity & Access

4. 4 By the end of 2003: 1. 1.over 90 percent (17,259 in total) of medical institutions in Taiwan had joined the NHI program 2. 2.183,103 medical personnel in Taiwan 3. 3.over 62,000 beneficiaries were served under health care improvement programs By the end of 2004: 1. 1.99 percent of the total population were covered by the NHI program and the public satisfaction rates of nearly 80 percent

5. 5 Access Access 1. 1.After the implementation of those policies on improving short of qualified medical personnel and facilities in rural and remote areas, medical service accessibility in these areas considerably improved. 2. 2.Uneven distributed geographically and by specialty. 3. 3.The overall ratio of physicians per 1,000 population in 2001 was 1.37, it was only 0.33 among Taiwan’s aboriginal people and 0.8 in the mountainous areas and offshore islands. 4. 4.Shortages also have been identified in psychiatric bed capacity and community rehabilitation centers. 5. 5.Shortage of practitioners in certain medical specialties.

6. 6 2. Cost Effectiveness

7. 7 Cost Effectiveness Defined as achievement of the greatest health outcome with the use of a given amount of resources Based on cross-country and self comparison of health expenditures as a share of GDP and also general health indicators

8. 8 Limitations More thoughtful interpretation of cost- effectiveness needs to examine the system’s impact on health status improvements, as isolated from the impact of climate, the population’s geriatric make-up, life-style, diet, age structure, health knowledge and care seeking patterns Some information difficult to collect and quantity

9. 9 Total Health Expenditures as % of GDP 1983-2003 Out-of-pocket Health Insurance Government Sector Total Health Expenditures NHI

10. 10 Health Services Expenditure as % of GDP in Selected Countries in 2000

11. 11 Life expectancy (Taiwan) Outcome - Life expectancy (Taiwan) In 2004 : 1.Average was 76.5 years 2.Males was 73.6 3.Females was 79.41

12. 12 Life Expectancy in 2001 Compared with Other Countries

13. 13 Life Expectancy The life expectancy was increasing from 71.9 (male) & 77.8 (female) in 1996 to 73.6 (male) & 79.41 (female) in 2004 When compared to other developed countries, the life expectancy is still lower, but it is comparable to Korea

14. 14 Outcome

15. 15 Infant Mortality Rate at 2001 as compared to Other Countries

16. 16 Outcome

17. 17 Standard Mortality Rate per 100,000 Population As Compared with Other Countries

18. 18 Standard Mortality Rate No obvious improvement in standard mortality rate after the implementation of NHI 554.62 per 100,000 population in 1995 increased to 575.63 in 2003 In recent years, communicable diseases receded in Taiwan, replaced with large shares by cancers, cerebral vascular diseases, geriatric diseases and accidents

19. 19 3.Cost Containment

20. 20 PROVIDERS OF CARE INSURANCE POOLS 4. Delivering health care to patients A FRAMEWORK OF HEALTH-CARE FINANCING in Taiwan GOVERNMENT EMPLOYERS HOUSEHOLDS Sources of funds Organizing risk pools Paying providers of health care Single payer Fee-for-services Low consumer cost sharing Mixed payment scheme: case payment,,DRG, Global Budget

21. 21

22. 22 Cost-Containment Increase premium rate: from 4.25% to 4.55% (Sep 2003) Increase co-payments (7 times) Price reductions: - Pharmaceuticals price cuts - Payment reforms: DRGs introduced Others: Increase claims reviews The Ultimate tool: Global budgets

23. 23 THE ULTIMATE COST-CONTAINMENT TOOL: Global budgets, by sector (Taiwan Public Health Report 2004)

24. 24 Cost Impact of Global Budget Reform 199719981999200020012002 Dental9.15%9.31%6.30%6.38%3.32%2.50% Chinese medicine 3.00%5.59%5.53%4.55%4.58%2% Physician clinic 8.26%7.70%3.30%-3.4%0.21%3.93% Western medicine 3.96%9.48%7.25%0.95%3.43%4.01% Hospital2.30%10.13%8.6%2.5%4.51%3.93%

25. 25 Cost Impact of Global Budget Reform

26. 26 Evaluation of Dental Global Budget n Per capita cost decrease: 9.1%  2.5% (-72%) n Preventive care provision (age 6-12) : 3%  99% (3200%) n Access (user rate):35.3%  36%(+2%) n Mean visits per user:3.15  3.08(-2.2%) n Mean cost per user :3225  3307 (+2.5%) n Repeat treatment rate(filling) :2.2%  0.55% (-74%) n Provision of invasive care decreased (Lee M.C. & Jones M. A.,2002)

27. 27 Volume vs. Intensity Growth Among Different Sectors Clinic DentalTraditional medicine Cost/vvolume (Lee Y.C. 2/002)

28. 28 Evaluation of Quality of Care Before and After Global Budget: Patients ’ Perspectives (Lee Y.C. 2/002)

29. 29 NHE Per GDP Growth rate Cost per capita3.5% Premium per capita 3.0% NEH3.9% Growth rate of NHE >> Growth rate of cost per capita >> premium per capita

30. 30 Hospital Reimbursement Diagnosis-related groups (DRG ’ s) Diagnosis-related groups (DRG ’ s) 1995-now, case payment for 50 cases (22 by procedures, 28 by APDRGs) 1995-now, case payment for 50 cases (22 by procedures, 28 by APDRGs) Outpatient: only 4 case (DRGs) Outpatient: only 4 case (DRGs) (Lee Y. C., 2003)

31. 31 Comparison of Inpatient Expenses FFS & Case Payment

32. 32 Co-payment Co-payment for outpatient services: 1999 to 2001 Pharmaceutical co-payment max. NT $200 Freq. user co-payment max. NT $100 Physical rehab. co-payment max. NT $210 Sept 1 2002 Regional hospital - from NT$100 to NT$140 Academic hospital - from NT$150 to NT$210 (Taiwan Public Health Report 2004)

33. 33 Review of claims (Taiwan Public Health Report 2004)

34. 34 Pharmaceutical Pharmaceutical Reference Pricing 1996 the latest round of cuts in March 2003 affected around 1,000 drugs with reductions of up to 50%. the usage of antibiotics was decreased by 53% from the restricted reimbursement policy rolling on antibiotics. Co-Payment Price adjustment -7 times Total cumulative savings: NT $25.4 billion (1996-2003)

35. 35

36. 36 4. Quality Patient satisfaction Technical quality   Input   Process   Outcomes (Donabedian,1980)

37. 37 High Satisfaction Satisfaction survey: In 1995, 39% and 76.6% in 2004

38. 38 Goals of the Growth of Medical Care Resources (Source: 2004 Taiwan Public Health Report)

39. 39 No of physician per 10,000

40. 40 Population served per physician

41. 41 Acute bed per 10,000

42. 42 Process - Accreditation of hospital 1.Taiwan Joint Commission on Hospital Accreditation in 1999 (TJCHA) 2.Integrated quality system for the entire Taiwan health care system 3.1st in Asia to conduct hospital accreditation 4.Accreditation for 3 years 5.497 hospital in 2005 6.500 hospital in 2006

43. 43 Violations Process - Violations No. of contracted medical care institutions (Hospital & clinic) 1996 15,662 2004 17,656

44. 44 Violations The contracted medical care institutions must follow the rules and regulations from the NHI The contracted medical care institutions must follow the rules and regulations from the NHI Penalities, Suspension of Contract, Termination of Contract if violations Penalities, Suspension of Contract, Termination of Contract if violations NO. of contracted institutions violation

45. 45 QUALITY_BASED PAYMENT Started on October 01, 2001 5 major diseases- cervical cancer, breast cancer, diabetes, tuberculosis, and asthma. Provides extra financial rewards to providers in addition to the NHI fee schedule. Finance of these extra rewards is not from global budgets. 2003, include more diseases to the project (namely cancer, hypertension, chronic B and C-type hepatitis … )

46. 46 Preliminary Results: Asthma Table 1: Medical services utilization of asthma participants in Taiwan before and after the Quality-Based Payment pilot program. ambulatory visits/patient E.R. visits/patient admission/pa tient Before1.5680.0680.031 After1.9050.0250.017 Chang e 0.337-0.043-0.014 Before: from April 01, 2001 to June 30, 2001. After: from April 01, 2002 to June 30, 2002.

47. 47 Preliminary Results: TB 9 month cure rate for TB participants: 40.69% 9 month cure rate for all TB cases in Taiwan: 30.1% (From the Center of Disease Control in Taiwan).

48. 48 Cost Efficiency - National Health Insurance IC Card The issuance of IC cards can reduce waste or abuse of medical resources and provide a convenient conduit for the exchange of medical information. The cards have been in full scale usage by the Taiwanese citizens in the health care system and have witnessed a high acceptance rate.

49. 49 5.Risk Pooling

50. 50 NHI objective  Key objective : To provide equal access to adequate healthcare for all citizens.  Approach : By risk pooling.

51. 51 Chronology of Health Insurance Year Description of Insurance Population Coverage 1950 Labor Insurance 40.12% 1958 Government Employee Insurance 8.06% 1985 Farmer Insurance 8.21% 1990 Low-income Household Insurance 0.55% 1995 National Health Insurance 100% 2003 98.67%

52. 52 Risk Pooling Arrangement 1.Over 98% enrollment rate for NHI scheme. 2.4.55% of the monthly wage for premium in 2003.

53. 53 Co-payment Rate – In-patient (Year 2006) Ward Co-payment Rate 5%10%20%30% Acute- 30 days or less 31 – 60 days 61 days and up Chronic 30 days or less 31 – 60 days 61 – 180 days 181 days and up

54. 54 Exemptions from Copayment 1.Catastrophic diseases (in-patient, pharmaceuticals, laboratory and examinations……) 2.Child delivery 3.Preventive health services 4.Medical services offered at the defined mountain areas or on offshore islands 5.Low-income households 6.Veterans 7.Children under the age of 3  Risk pooling for catastrophic disease patients !

55. 55 (Source: 2004 Taiwan Public Health Report) Catastrophic Illness Cardholders

56. 56 6.Sustainability

57. 57 Sustainability

58. 58 Trend of NHI Financial Status Unit: NT$bn

59. 59 1. 1.Universal enrollment 2. 2.Better medical personnel to patients in ratio 3. 3.Higher public satisfaction 4. 4.The NHI has accomplished its objectives and goal Provide equal access to healthcare for all people Control health service cost at socially affordable level Promote efficient use of health care resources Outcome

60. 60 Acknowledgement Cheng, T. M. Taiwan’s new national health insurance program: genesis and experience so far, 22(3), Health Affairs. The Policy Journal of the Health Sphere. Liu, S. L. (2005). Evaluating the efficiency of the use of medical resources in Taiwan’s medical care network: An application of data envelopment analysis, Institute of Health Care Management. The Republic of China Yearbook – Taiwan 2002 (http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/2002/) The Republic of China Yearbook – Taiwan 2003 (http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/2003/) The Republic of China Yearbook – Taiwan 2004 (http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/2004/) The Republic of China Yearbook – Taiwan 2005 (http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/) 2004 Taiwan Public Health Report, Department of Health, Taiwan, R.O.C.http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/2002/http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/2003/http://www.gio.gov.tw/taiwan-website/5-gp/yearbook/2004/

61. 61 Thank you