Priorities and Distribution in Care

Abstract

In the third part of this report we look at choices with regard to health and social care. In what ways can people and resources be distributed across sectors, organizations, treatments and preventive interventions? How do we divide our public resources between care and other goals? And how do we decide on such questions? Whereas our focus in the previous part was the organization of care and achieving effectiveness or productive efficiency—how to provide care—we now turn our attention to what to do? What care do we offer? And how much of it? Economists refer to this as allocative efficiency: to what ends should resources be allocated and what should attract fewer, or none at all? Allocative efficiency also concerns the extent to which that allocation is in line with society’s wishes and preferences. In other words, are we doing the right things? This is all about priorities, not to mention the practical limits we set to the growth of health and social care. And perhaps even more importantly, about how the choices are made.

The sustainability of health and social care is largely a question of making choices and setting priorities. At present, however, the way in which those choices are made is less than ideal from the perspective of health gains and safeguarding public values.

In the third part of this report we look at choices with regard to health and social care. In what ways can people and resources be distributed across sectors, organizations, treatments and preventive interventions? How do we divide our public resources between care and other goals? And how do we decide on such questions? Whereas our focus in the previous part was the organization of care and achieving effectiveness or productive efficiency—how to provide care—we now turn our attention to what to do? What care do we offer? And how much of it? Economists refer to this as allocative efficiency: to what ends should resources be allocated and what should attract fewer, or none at all? Allocative efficiency also concerns the extent to which that allocation is in line with society’s wishes and preferences.¹ In other words, are we doing the right things? This is all about priorities, not to mention the practical limits we set to the growth of health and social care. And perhaps even more importantly, about how the choices are made.

To answer these questions, in this chapter we look at the current organization of choice processes in the Dutch care sector and at the resulting distribution of resources—both within care itself and between it and other sectors. In particular, we examine whether these patterns are the most desirable from a health perspective. And we identify five impediments affecting choices within and about care. In the next chapter we further analyse the social, political and administrative backgrounds to those impediments and look at ways of tackling them.

7.1 Limits to Growth: A Matter of Choices and Priorities

When it comes to something as essential as care, why should there be any limits? Surely everyone is entitled to receive whatever they need. In an ideal world yes, but that is not the world we are living in. Ultimately, the sustainability challenge in health and social care is largely a question of allocating scarce resources. People always want better health or a longer life, and preferably both. But society’s ability to satisfy that desire is limited. People and resources are finite, and so too is our collective willingness to devote them to the care sector.² In the first two parts of this report we saw that these limitations are set to become increasingly evident in the coming years, given the trends and developments society will experience (see Chap. 2). Demand for care is expected to continue to rise rapidly, whilst the expansion of the working population is stagnating and economic growth is also lagging behind care needs. The issue of scarcity and how to deal with it is therefore going to become increasingly important, since the sector just cannot continue to expand as it has been. The people needed to provide that level of care simply do not exist. This means that a gap is increasingly opening up between public expectations—that more and more care can be provided, ad infinitum—and the repercussions of that kind of growth.

Safeguarding the public values associated with care and keeping the three dimensions of sustainability in equilibrium means that the Netherlands is going to start having to make tough choices. It also means that the government and politicians will need to think carefully about where to draw the boundaries of growth, and thus what priorities to set. In a world where people and resources are increasingly scarce, after all, it is becoming more and more important to deploy them where they can best uphold the public values of quality and accessibility. And where they are in a position to deliver the greatest health benefits, specifically longer life expectancy in good health. All of which requires clear choices: where do the limits to growth lie, and by extension what care should remain collectively funded and what should not? Moreover, choices also need to be made about the criteria whereby that distinction is drawn. In short, priorities have to be set.

Choices concerning priorities are already made on a daily basis in thousands of places throughout the health and care sector, as well as in the associated policy domain. We cannot explore all of those countless choices in this chapter, so instead we single out the most important ones. They cover a broad spectrum. Some are very specific: should a particular medicine be reimbursed from the collective coffers, for example, or what treatment or diagnostics should a particular patient receive? Others are far more general, such as how much to allocate to the various aspects of health and social care? And at the highest level of all, government policy, there are choices about how we divide available human and material resources between care and other policy domains. Each of these choices is, in the final analysis, about comparing different options. Does money go to care or to education? Do we prioritize long-term care or prevention? Do we buy a surgical robot or hire more staff?

In the next section (Sect. 7.2) we look in broad terms at the prerequisites for care-related prioritization. We next home in on the way key choice processes in care are currently organized (Sect. 7.3). Here we start from the bottom up, with prioritization and limits within the various fields of care and in particular the two largest: curative medicine and long-term care. After that we turn our attention to the broad distribution of resources and people between fields, and then finally to their distribution across care and other public policy domains (Sects. 7.4, 7.5, and 7.6). Although it might seem more logical to begin at the top, so to speak, with choices about the overall allocation of resources to the care sector, we have adopted this “reverse” order because in fact the allocation patterns at the higher levels are largely determined by choices made lower down the ladder: decisions concerning the scope of collective insurance cover for all the various forms of care, for example, or those taken in the consulting room. In the Netherlands, implicit choices around “bigger” questions—such as the total amount of money spent on care—are more likely to flow from those made at lower levels than vice versa. Although in reality, of course, choices and decisions at all these levels influence each other—we describe them separately, but in a complex system everything is interrelated.

Key Points—Limits to the Growth: A Matter of Choices and Priorities

• Making choices in health and social care is about setting priorities.

• That is essential in order to be able to offer accessible and high-quality care.

• The choices are made in many different places: in the consulting room (between patient and practitioner), in the boardroom and in parliament.

7.2 Choices in Care: The Theory

In this section we look at the theory underpinning choices to limit the growth of the health and social care sector. That involves first assessing and comparing the benefits of the care available,³ then weighing them up in normative terms: how important do we as a society consider them to be, what are we prepared to pay for them and how do we think they should be distributed?

7.2.1 Assessing the Benefits—What Are They?

Either implicitly or explicitly, choices about limiting growth in the care sector always involve comparing different options. Not that the “alternative” is necessarily easy to identify: when deciding on the approval of a new medicine for a rare hereditary muscle condition, for example, we do not compare its performance explicitly with the possible benefits of a novel treatment for breast cancer. And we make decisions about the allocation of resources to nursing care for the elderly without specifically considering the requirements of preventive medicine—to fund mass screening for cancer, say—as an alternative. But such comparisons may well be implicit: choosing one option could preclude the other. Even if they are in no way similar. Or even simultaneous: the new medicine for breast cancer is available now, the one for the muscle condition not until next year, and even that is far from certain. Despite all their dissimilarities and their separation in time, in a world of scarcity these choices influence each other. Money and people already allocated to treatment A can no longer be used for treatment B, now or in the future.

One way or another, then, making choices in health and social care is a matter of comparing disparate options and their benefits for society.⁴ To start with, these may be direct: a tangible individual health gain or improvement in the patient’s quality of life. Benefits of this kind are assessed by comparing them with the health or quality of life that person would have experienced if the care in question had not been provided. Then there are indirect benefits. For example, the collective health gains derived from treating infectious diseases and carrying out vaccination programmes. These have received a great deal of attention in the past couple of years in the context of the Covid-19 pandemic. Or think of the economic benefits: working people are more productive when they are healthier.⁵ And then there is public trust, the reassuring idea that good care will be available if we need it.

However important such indirect benefits may be, ultimately they depend upon—and are a product of—direct health benefits. One widely-used measure in this domain is the QALY, or quality-adjusted life year (see Box 7.1). Taking into account both total life expectancy and quality of life during that time, this tool enables us to compare (to some extent at least) the benefits of otherwise utterly dissimilar treatments or interventions. QALYS are used mainly in curative medicine; other fields have their own methods, such as ICECAP (the Investigating Choice Experiments Capability Measure) in long-term care, where there is a greater focus upon quality of life than upon curing people. ICECAP measures how subjects rate their lives in terms of factors like attachment, security, autonomy and enjoyment.⁶ Measures of this kind create a degree of comparability within part of healthcare by quantifying answers to the question, “What benefits does this form of care deliver?”

Box 7.1: QALY: A Measure of Life Expectancy and Quality of Life

The QALY, short for “quality-adjusted life year”, is the most commonly used measure of the benefits of healthcare interventions. It is a way of expressing the outcomes of particular clinical or preventive treatments using what are generally regarded as their two primary goals: improving life expectancy and quality of life. QALYS capture both in a single measure and try to do justice to the widely-held notion that good care is not just about living longer but also about living a good life.⁷ A treatment that extends life by one year in full health generates one QALY. A year of life gained with a lesser quality of life counts for less—say 80 per cent (0.8 QALY).

7.2.2 Weighing Up the Benefits—What Is Important?

Once the health gains and costs of a treatment are known, the next step is to weigh up its potential benefits. What do we as a society consider important? To be able to take decisions concerning the limits of care that are legitimate in the public eye, we need to reach a certain degree of consensus on this point. So in this step we look not only at what care is able to “deliver”, but also at how those outcomes are distributed: who ultimately benefits? Ethical philosophers have developed a number of principles of so-called “distributive justice” which can help us here; some of those most frequently used in the context of health and social care are summarized in Table 7.1.

Table 7.1 Principles of distributive justice for prioritization in healthcare

Utilitarianism is about optimizing potential health gains for the entire population.⁸ After comparing possible treatments, the one which helps achieve the greatest health gain per invested euro is chosen. In fact, then, this approach only optimizes efficiency and seeks to offer as much overall health gain as possible with a given budget. Other considerations, such as the health status of the people to whom the gains accrue or the distribution of care provision across the population, are disregarded. As the example of Oregon (see Box 7.2) shows, however, making choices purely on this basis leads to outcomes that society may regard as unjust.

Box 7.2: Systematic Prioritization in Oregon

In the early 1990s the US state of Oregon became one of the first jurisdictions to conduct an experiment to tackle clinical priorities in a systematic and objective manner.⁹ As initially proposed, the scheme was based solely upon QALYS gained versus costs incurred. In other words, it was strictly utilitarian in its approach. With the result that extracting wisdom teeth would have become one of the state’s top ten clinical priorities, whereas intensive care for premature babies with a very low birth weight was well down the list. This led to widespread dissatisfaction with the system and the criteria used.

From a purely utilitarian point of view, however, it was an understandable outcome. The treatments available at the time for very premature babies had a relatively low chance of success, so the expected health gains were small. But the public response aptly illustrates the fact that the distribution of those gains—whose health improves?—is also important to people. Factors such as the severity of a patient’s illness, their age and their expected loss of life years do matter to them. As a result, Oregon never introduced its original, entirely utilitarian list. Instead, a number of other considerations were taken into account when determining the eventual prioritization.

The other principles of distributive justice listed in Table 7.1 can all be regarded as corrections to or variations on utilitarianism.¹⁰ All in some way or another weigh¹¹ certain forms of health gain more heavily than others, and thus consider more factors than just the overall extent of the gain. Take the “rule of rescue”, for instance. According to this principle, we should consider not only health potential but also the urgency of treatment. Potential health gains for acute patients thus outweigh the same gains for less acute ones. Under the “fair innings” approach, the same gain is given more weight for a younger person than an older one. During the Covid-19 crisis, almost all of these principles were applied to some extent in the Netherlands (see Box 7.3).

Box 7.3: Normative Justification of Covid-19 Prioritization

At several points during Covid-19, fears arose in the Netherlands that there would be an acute shortage of intensive-care beds for critically ill patients requiring ventilation. This brought the issue of prioritizing scarce medical resources to public attention, in a far more acute way than in the context of sustainability. The underlying principles at play, however, are similar.

At the beginning of the crisis in March 2020, the Dutch Society of Intensive Care (Nederlandse Vereniging van Intensive Care, NVIC) issued a triage guide describing how ICU capacity should be allocated during an acute emergency phase.¹² The inclusion criteria were essentially a form of the “rule of rescue”: only patients with an urgent and acute need for ventilation would be eligible for admission.

The exclusion criteria applied at the time can be viewed as a mix combining elements of the “absolute shortfall” and “fair innings” principles. For example, advanced age (over 80) as the final criterion was in line with “fair innings”. But a number of situations with a low probability of survival and a short life expectancy were also listed, such as metastatic cancer. That is a form of “absolute shortfall”, since those patients were not expected to live much longer anyway. The limited likely benefits of ICU treatment for them meant that they were given a lower priority than other categories. In the political and public arenas, the “fair innings” aspect of this triage proved particularly controversial.¹³ It even triggered an initiative to ban by law the use of age alone as a criterion for treatment, although that was later withdrawn in the face of protests from the medical profession.

Dutch Preferences Regarding Prioritization

What are the Dutch public’s preferences when it comes to prioritization in healthcare? Research¹⁴ shows that, broadly speaking, people here feel that health gains for conditions with a high burden of disease should cost more. This is in line with both the “proportional shortfall” and “absolute shortfall” approaches. The Dutch also tend to support measuring the burden of disease according to the “proportional shortfall” principle (see Table 7.1). In addition, there is reasonable enthusiasm for principles along “fair innings” lines, meaning that health gains for the young should prevail over gains for the old. These findings support the approach adopted in the Netherlands in defining the basic statutory health insurance package, whereby higher maximum costs per QALY are applied to serious diseases.¹⁵ Similar outcomes emerged from the citizens’ forum Choices in Care (Keuzes in de Zorg), at which 24 lay participants debated the scope of the basic health insurance package over three weekends.¹⁶

Procedural Justice

The normative frameworks listed in Table 7.1 are forms of distributive justice. There are also theories that focus not so much upon substantive considerations but rather upon the process whereby they are weighed up—“procedural justice”.¹⁷ Proponents of this kind of approach argue that general frameworks such as “fair innings” are not specific enough to enable truly practical choices.¹⁸ More fundamentally, they also object that it will never be possible for society to agree on any single framework because people disagree at root about the importance of the underlying principles. It follows from this that they believe it illusory to think that any theory of distributive justice can ever lead to decisions that enjoy universal legitimacy. It is therefore more important to institute a fair procedure that ultimately leads to legitimate decisions with regard to prioritization. With, at its heart, an open, deliberative process accessible to ordinary citizens or their proxies (public participation with appeal rights). Such a process helps articulate views and preferences and to hone them through contact with other opinions. By its deliberative nature, moreover, the process should bring equilibrium to the conflict of interest inherent in citizens’ dual role within the system, as both its benefactors (through taxes and insurance premiums) and its beneficiaries (as patients, now or in the future).

In practice, the distributive and procedural approaches are complementary. To reach consensus concerning a principle of distributive justice, for example, public debate is essential—either in the political arena or through various forms of citizen participation. We look at this interaction in more detail in the next chapter.

Choosing Care—Or Something Else?

Finally, we need to broaden our outlook even further. Up until now we have confined ourselves to prioritization within health and social care—treatment A or treatment B, curative or preventive medicine? The issue of sustainability, however, is also about whether society prefers to deploy people and resources to this sector or to other public policy domains, such as education. This makes measuring and comparing the benefits even more complex. Even within the sector, making comparisons is hard enough because of the wide disparities between the returns generated by different forms of care. It becomes truly daunting when the broad gains to be had from investing in defence, education, culture or social security are set against those we can derive from enabling care to expand further. The challenge becomes a little more manageable, however, if we look only at the health benefits delivered by domains other than health and social care. After all, we know that activities like education, combating poverty, design of the physical environment and public welfare deliver considerable health benefits in their own right, in the form of preventive effects.¹⁹ Whilst their impact is impossible to quantify exactly, in all probability such factors as housing, working conditions, the environment and social cohesion are more significant determinants of general health than actual care in the narrow sense.

Choices in Practice—What Do We Actually Do?

So much for the theory behind choices in care. That is simply a matter of assessing the benefits of all the various kinds of care, then reflecting in an open public discourse upon the principles used to weigh them up and upon their true worth to society. The next step is to apply this process to all forms of care that can be provided collectively.²⁰ The result is choices and priorities that society is able to support. This outcome makes it clear what care will and will not be provided, and hence where the limits to the sector’s growth lie. But that is not how things work in practice, of course. There are all kinds of reasons for this, from institutional barriers to lack of knowledge, normative objections and differences between social groups in their ability to organize themselves. In the rest of this chapter we look at how choices about the prioritization and allocation of care are made at three different levels in the Netherlands.

Key Points—Choices in Care: The Theory

• To be able to choose between alternative interventions, as far as possible their respective benefits should be measurable and comparable.

• Although there are tools available to help with this, such as the QALY, it is never possible to measure benefits in a completely objective way.

• In order to arrive at a choice, benefits and costs should not only be assessed but also weighted. This involves the inherently normative question of what we as a society consider important and just.

• Various principles of distributive justice that can help us with the process of making choices. And in the interests of procedural justice, we also need to ensure that the process itself is fair.

7.3 Choices in Practice: Prioritization in Different Fields of Care

To consider prioritization within health and social care in more detail, we separate the sector into a number of broad fields. Within these we look in particular at the assessment framework for prioritization (what criteria are used?), but also at institutional embedding (which actors are responsible for the assessment?) Because they are closely linked, we discuss both aspects together.

We focus mainly upon curative medicine and long-term care because these fields constitute the bulk of the sector by both current volume and expected contribution to future growth (See Chap. 2). From the sustainability point of view—especially in its financial and staffing dimensions—it is therefore vitally important that clear choices be made within these two domains. As a hypothetical example, if an unequivocal choice were made to reduce the forecast annual growth in hospital provision by 0.5 per cent, in 2060 that would save more than 15 times the total estimated expenditure on municipal health services in that year.²¹ In other words, by making better choices within the two dominant fields of care it soon becomes possible to free up a lot of human and material resources for other purposes, either within the care sector or elsewhere.

7.3.1 Curative Medicine

Curative medicine aims to successfully treat and cure acute and chronic illness. In the Dutch system, it largely coincides with the provision financed under the Healthcare Insurance Act (Zorgverzekeringswet, Zvw; see Chap. 4). The fact that government has a duty to ensure access to a comprehensive range of high-quality curative medicine is generally uncontroversial in the Netherlands; debate focuses more upon the limits of that responsibility. In other words, what forms of care should and should not be covered. Choices made in that respect have direct implications for the human and financial sustainability of care; after all, a larger package of insured benefits requires more people and resources than a small one. Any decision concerning priorities within care thus involves an implicit choice about the sector as a whole: how much money goes to it and how much is left over for other public services?

In the Netherlands, ultimately it is the government which decides what care is and is not covered under the basic statutory health insurance package. The National Health Care Institute (Zorginstituut Nederland, ZiN) provides advice, both solicited and unsolicited, on the composition of that package.²² In doing so it considers the principles of procedural justice—providing for public consultations, for instance—and to some extent distributive justice as well (see Table 7.1). In general, new forms of care are “admitted” to the package in one of two ways: through a so-called “closed” system involving a formal authorization procedure (see Box 7.4) or through the “open” system, whereby an effective treatment is accepted automatically. The vast majority of new treatments follow the “open” route.

Box 7.4: Authorization of Medicines Using the Closed System

The “closed” authorization system applies in particular to medicines available at pharmacies and to a number of expensive drugs only dispensed in hospitals.²³ These are reimbursed under the basic statutory health insurance package only once they have successfully undergone a formal procedure to check their compliance with four basic criteria: necessity, clinical effectiveness, cost-effectiveness and feasibility.²⁴ First of all, in other words, does the disorder in question actually require medication-based treatment (necessity)? Will the new treatment deliver sufficient health gains (clinical effectiveness)? Do those gains outweigh its cost (cost-effectiveness)? And is it actually possible for clinicians in the Netherlands to provide the treatment (feasibility)? New medicines are assessed by the ZiN’s Insured Package Advisory Committee (Adviescommissie Pakket, ACP), made up of medical specialists, ethicists, economists and other experts. It compiles a draft recommendation, which is submitted to various interested parties (patient organizations, pharmaceutical companies and so on). After a public session to hear their feedback, the ACP draws up its final recommendation concerning the drug’s authorization.

The ZiN advice to the Minister of Health is based upon the outcome of the procedure conducted by its ACP (see Box 7.4). The minister is not obliged to adopt this, however, but can instead make his or her own assessment. He or she can also take decisions concerning the basic insurance package without prior advice from the ZiN. Ultimately, then, those decisions are a political matter. That is not always the case in other countries. We look in more detail at some of their alternative arrangements in the next chapter.

From a sustainability perspective, cost-effectiveness is the most essential of the four criteria applied by the ZiN. In this context, it basically expresses how much society is prepared to invest to achieve a year of “good” life (a QALY)—at least through the forms of care covered by this procedure (primarily medicines). The ZiN’s advice is not necessarily confined to a recommendation on whether or not to authorize the drug: it can also suggest that the minister negotiate regarding its price. This is usually done when a treatment has been deemed clinically effective—that is, it does deliver health gains—but not (or not yet) cost-effective. If the price drops far enough, after all, any therapy that works eventually becomes cost-effective.

Whilst this “closed” authorization system applies to certain specific forms of treatment, medicines in particular, as stated above the vast majority—95 per cent—follow the “open” route (see Fig. 7.1).²⁵ This effectively includes all therapeutic provision not involving a medicine—medical devices and aids, for instance.²⁶ In their case healthcare providers and insurers decide between themselves, without following a formal procedure, whether a solution falls within the scope of statutory insurance cover. There are still set parameters, however. First and foremost, the treatment has to be clinically effective. In other words, it must deliver health gains. More specifically, it needs to be in line with the current “state of the art” in medical science and clinical practice. If there is any uncertainty on that point, health insurers, care providers or members of the public can request a so-called “standpoint” from the ZiN. This only states whether or not the treatment has been found to be clinically effective, however, and says nothing about its cost-effectiveness. This open access route thus has a very fundamental implication from a sustainability perspective. Across the vast majority of the statutory package, any new treatment that is more clinically effective than the existing one is authorized automatically. In other words, improvements to the quality of care are implemented immediately and without any explicit decision, political or otherwise, concerning their admissibility or any consideration of the costs involved.²⁷

Fig. 7.1

Schematic diagram of statutory health insurance package management in the Netherlands

Outflow

When it comes to sustainability, “outflow” from the statutory health insurance package—forms of care it ceases to cover—is at least as important as the “inflow” of new treatments. As science and technology advance, a solution may no longer satisfy the requirements for inclusion. For example, because further research has shown that, in practice, it fails to yield the hoped-for health gains. In the Dutch package management system, formal outflow mechanisms exist only to a very limited extent. Only expensive intramural medicines (those administered solely at hospitals) can be granted provisional authorization within the terms of the “closed” procedure described above. Other treatments may or may not be reassessed on an ad-hoc basis, and then possibly excluded from the package—as happened with a number of over-the-counter medicines with effect from the beginning of 2019.²⁸ For other forms of care, the “state of the art” criterion applies. In other words, it must be clear from scientific research or clinical practice that a treatment is no longer appropriate and so should not be reimbursed any more. Formal exclusions from the package are therefore very infrequent. Moreover, their financial impact is limited. According to the Netherlands Court of Audit (Algemene Rekenkamer), explicit outflow decisions between 2007 and 2013 were expected in advance to result in cumulative annual savings of €0.5 billion, but in the end achieved only half of that figure.²⁹ A very modest amount when set against the €13.4 billion increase in Zvw-related healthcare spending in the same period.

Choices in the Consulting Room—Appropriate and Inappropriate Care

Thus far we have discussed prioritization in curative medicine solely as a matter of whether or not to include a particular treatment in the basic statutory health insurance package. In a large number of situations, however, the picture is not so clear-cut. Rather, it is a matter of identifying subgroups of patients for whom the solution is both clinically effective and cost-effective. In practical terms, this shifts the decision about whether or not to use it from the system level to the consultation level: does this particular patient fall within the group proven to benefit from the intervention? But it also highlights major obstacles to the actual provision of appropriate care in this way.³⁰ Underlying these is a whole raft of processes, often behavioural in nature. In clinical practice, for example, treatments of various kinds are often prescribed more and more widely as time passes—often even when there is no scientific proof that the patient concerned will benefit. It is estimated that 40 per cent of all care provided within the statutory package is not known to be evidence-based, whilst 10 per cent is demonstrably inappropriate.³¹ In the Dutch system, delivering the right form of care for the patient and their condition is ultimately the shared responsibility of the parties “in the field”, especially practitioners and insurers: the former on the basis of their duty as medical professionals, the latter in their capacity as pilots of an efficient system steered by their purchasing policies—meaning that they should avoid reimbursing non-appropriate care. However, a recent evaluation by the Court of Audit raises serious doubts about the effectiveness of this mechanism.³² It shows that some forms of care continue to be offered even when there is good evidence that they are not appropriate.

Implicit Choices and Displacement

In addition to the explicit choices within curative medicine described above, prioritization can also take place in an implicit fashion. In a world where people and resources are scarce, the provision of one form of care can lead to others effectively being supplanted. Such implicit displacement often takes place at a lower level within the system; for example, when a healthcare institution sets its priorities.³³ A study commissioned by the ZiN analysed six cases in the field of curative medicine and found that the pressure on providers’ budgets caused by the introduction of new medical technology probably leads to other aspects of care being pushed aside—with possible negative net health outcomes as a result. For example, the purchase of an expensive device like a surgical robot may indirectly leave a hospital with a smaller budget for staffing. However, such displacement is hard to demonstrate on a one-to-one basis.³⁴ Protocols like the outline agreements in which stakeholders agree to limit cost increases within a sector (see Chap. 5) only raise the potential for effects of this kind,³⁵ though, because they tighten institutions’ budget constraints. These agreements can therefore be regarded as a means of imposing implicit prioritization choices,³⁶ but the question is always whether the resulting trade-off is the one that delivers the greatest health benefits.

7.3.2 Long-Term Care

The core purpose of long-term care is to provide nursing and support, if necessary on a full-time basis, rather than working towards a cure and recovery. Medical interventions are only a limited part of this; much of the work is about helping people with their day-to-day functioning (washing, assistance with dressing and so on). Users of long-term care are often vulnerable, such as those who have difficulty leading an independent life due to severe physical or mental disability, dementia or the like. As with curative medicine, there is debate here as to what provision should and should not be a collective responsibility. But whereas choices in that field relate mainly to innovations (new medicines, medical devices and technologies) and their inclusion (or not) in the basic statutory health insurance package, that factor plays much less of a role in long-term care. After all, far fewer “new” forms of care are developed in this domain. Which makes the normative aspects of the decision-making process all the more important. For instance, should the package cover services like cleaning and preparing meals? And how much responsibility for a person’s care rests with their own social network: family, friends, neighbours and so on?

In principle, long-term care provision—like the “open access” component of curative medicine—must comply with strict scientific and practical criteria concerning its clinical effectiveness. In practice, however, there is no great tradition of demonstrating such effectiveness in this field.³⁷ That is due in part to its lack of a research culture and systematic research funding. But also because its outcomes are harder to measure objectively. Long-term care is largely concerned with preserving quality of life, which more than curative care is about the client’s own subjective perceptions preferences. And that makes it even more difficult to define clear boundaries. Nevertheless, tools are being developed to measure the benefits of long-term care, amongst them the ICECAP method mentioned earlier.

Despite these limitations, there are implicit forms of prioritization in long-term care. Since a reform of the Dutch system in in 2015, for example, only people suffering the greatest burden of disease are now eligible for permanent residence in nursing homes. As a result, their capacity has been reduced, more people are remaining in their own homes for longer periods of time and those who are in residential care tend to be in poorer health. A comparative analysis of long-term care for the elderly in other countries has revealed a similar trend elsewhere, although in some cases that has since reversed, causing a pendulum effect.³⁸ One reason for those turnarounds is that it had not become evident that the shift to home-based provision was leading to any improvement in staffing or financial sustainability. After all, care at home does not necessarily require fewer personnel, nor is it bound to be cheaper. Research in the Netherlands has shown that savings on long-term care have been offset by higher expenditure on curative medicine and home care.³⁹ For precisely this reason, the trend towards home care in Japan has been partially reversed. In Denmark less so, but there a highly advanced system of home care provision had to be put in place to make the shift possible.⁴⁰ In the Netherlands, moreover, the increased prevalence of home care has unintentionally led to what is known as the “wrong bed” problem. As residential care capacity is reduced, patients needing long-term care sometimes end up staying in hospital for extended periods,⁴¹ which leads to higher costs. The same phenomenon has also been observed in Japan, where the population has been ageing rapidly.⁴² This is a prime example of how prioritization within one field can have unexpected repercussions for another—and how they are not necessarily ideal for the health and social care system as a whole. Similar unintended allocation effects have occurred in other places as well (see Box 7.5).

Box 7.5: Quality Framework for Nursing Homes

One topic to have received a lot of attention in the Netherlands in recent years is the quality framework for nursing homes. Following a public campaign, there was huge political pressure to improve the standard of care in these institutions. In 2016, the government asked the ZiN to draw up a new quality framework for and in consultation with the homes. But after discussions broke down, the ZiN’s Quality Council went on to compile a framework unilaterally. The cost of implementing this turned out to be €2.1 billion annually, a sum the government was forced to provide since it had committed itself to funding the framework⁴³—although some of that money could subsequently not be spent due to a shortage of staff.⁴⁴

The course of events surrounding the quality framework for nursing homes (see Box 7.5) raises a number of questions about how resources are deployed within long-term care for the elderly and other groups. First of all, whether cost-effectiveness was rightly excluded from the quality framework; should it not in fact be a core consideration when developing instruments of this kind?⁴⁵ Secondly, whether it is right for the ZiN and providers themselves to be solely responsible for that decision; should including (or excluding) quality as a criterion not be a political choice? This question has since been partially answered with the introduction of a so-called “emergency brake”, which allows politicians to intervene in the event of a very substantial expected increase in expenditure.⁴⁶ But the broader question remains as to whether this political assessment should not be more wide-ranging and take place at an earlier stage. Thirdly, this story highlights the fact that financial resources are not the only limiting factor: staffing issues also play an important role (see 3.3). Showing once again how important it is for healthcare policy to consider all three dimensions of sustainability, and keep them in equilibrium.

7.3.3 Child and Youth Care and Mental Healthcare

Finally, we look briefly at prioritization and allocation within child and youth care services and in mental healthcare. Although these fields are limited in scale size at a macro level (see Fig. 1.4), clear shifts in their implicit prioritization can be observed. Moreover, all aspects of child and youth care are experiencing rapid growth (see Chap. 4). Rigorous consideration of the way priorities are set within these fields is particularly important because—as we saw earlier in this report (see Chap. 4)—parts of both currently fail to meet basic standards with regard to quality and accessibility.

In respect of prioritization, we see similar constraints here as in long-term care: benefits are not as easy to measure or quantify objectively as in curative medicine, largely because they are linked more to quality of life than to health gains. And often also to the client’s situation outside the care setting (housing, work and so on).

Looking at distribution patterns in recent years, a few things nevertheless stand out. In mental healthcare, for instance, growth has been far stronger in basic provision—the treatment of milder disorders—than in specialist services. In the period 2015–2018, the number of patients receiving basic mental healthcare rose by 11 per cent. In specialist care the figure was 2.9 per cent. Spending rose by 22.6 and 10.7 per cent respectively.⁴⁷ In the preceding period, 2011–2016, expenditure on specialist mental healthcare actually fell by 6 per cent in absolute terms.⁴⁸ Compared with other parts of the health and social care system—and curative medicine in particular—this picture bucks the general trend. Which is especially striking given the high and increasing demand for these forms of care and the persistent waiting lists for more serious forms of mental healthcare (see Chap. 4). Within child and youth care, too, client numbers went up from just over 350,000 a year to almost 450,000 between 2015 and 2019. Most of the increase was in use of relatively light-touch support services; the numbers of child protection and judicial referral cases during that period remained roughly the same, at about 40,000 and 9000 respectively.⁴⁹

Key Points—Choices in Practice: Prioritization in Different Fields of Care

• In only a relatively limited part of the Dutch health and social care sector are benefits explicitly weighed against costs.

• Most new forms of care (quality improvement) in curative medicine are introduced automatically: about 95 per cent enter the basic statutory health insurance package via the so-called “open” route.

• In long-term care, mental healthcare and child and youth care services, too, there is only limited explicit testing and delineation of insured cover (package management) in terms of clinical and cost effectiveness.

• So-called “outflow” (the exclusion from the package of forms of care that are not or are no longer appropriate) is intermittent and is not organized systematically. As a result, for some 40 per cent of the care included in the package we are unable to determine whether or not it is appropriate.

• The growth of resources and users in child and youth care services and in mental healthcare is related mainly to relatively minor problems.

7.4 Choices in Practice: Distribution Between Fields

Having discussed prioritization within various fields of care in the previous section, we now look one level higher: at how resources—and hence people—are distributed between different fields in the Netherlands. We have already noted in the first chapter of this report that the bulk of resources go to specialist medical and long-term care.

In this section we further unravel the choice processes underlying this allocation. How is it determined and how does it change over time? What dials can policymakers turn? We focus in particular upon the distribution of resources; although this does not coincide entirely with the distribution of people, the two are closely related.

In the Dutch context, the most useful approach to this question is through the so-called “system laws” governing the funding and provision of health and social care. Overall spending under the Healthcare Insurance Act (Zorgverzekeringswet, Zvw)—covering, roughly speaking, all forms of curative medicine—is primarily demand-led, in line with the scope of the care included in the basic statutory insurance package. The dynamics of the inclusion process (the inflow and outflow described earlier in this chapter) thus indirectly determine the total demand for resources. Insurers are free to set the premium they charge policyholders directly for the package, whilst the income-dependent contribution is determined by central government. In the case of the Long-Term Care Act (Wet langdurige zorg, Wlz), both premiums and payments—and hence total expenditure—are regulated by the government. As for the Social Support Act (Wet maatschappelijke ondersteuning, Wmo) and the Child and Youth Act (Jeugdwet), total expenditure depends upon the policy choices made by the individual local authorities with respect to the services they provide.

Within the scope of all the system laws, in practice there is a complex interaction between public expectations concerning the quality and accessibility of provision and what is actually delivered. Governments—national and local—in theory usually have the freedom to set and to vary budgets, but in the real world their room for manoeuvre is limited because any changes very quickly impact services on the ground. One example is the effects of budget cuts in the wake of the financial crisis upon employment levels in mental healthcare, child and youth care services and nursing and personal care, and the resulting problems with waiting lists and quality (see Chaps. 3 and 4).

Looking at the historical distribution of resources to various types of provider (see Fig. 7.2),⁵⁰ we find that specialist medical care has accounted for the largest share of expenditure over the past twenty years. Moreover, that share has increased gradually from 27 per cent at the turn of the century to well over 30 per cent today. More generally, as revealed by the relatively “flat” lines in Fig. 7.2 the broad pattern of allocation changes only very slowly. This reflects a high degree of path dependence: to a great extent, the distribution of resources is determined by historical factors. To some degree this is inevitable—the underlying demographic, social and technological trends are slow as well. A “supertanker” like the health and social care sector cannot change course too suddenly, and it is questionable whether that would be desirable.

Fig. 7.2

Relative distribution of expenditure by eight types of health and social care provider, 1998–2019. (Some of the shifts observed can be explained by the transfer of care budgets from one field to another. In 2012, for instance, the “expensive medicines” budget was reallocated to hospitals. The categories in this diagram correspond with the main headings in Fig. 1.4, with two exceptions: (1) “long-term care” is subdivided into disability care and nursing and care homes; and (2) “policy and management organizations” are omitted because our focus here is care providers)

7.4.1 Limited Commitment to Prevention

Regardless of the speed of the shifts within it, the distribution of resources seems to bear fairly little relationship to where in the system we know that health gains can be achieved, quality of life improved and public values upheld. This is problematic given the sustainability challenges we face. The increasing scarcity of people and resources within the care sector means that the issue of displacement is becoming more and more acute,⁵¹ which in turn makes it all the more important that they be deployed where quality and accessibility require the greatest support and where health gains can be achieved in a relatively efficient manner. It is precisely when scarcity is an issue, after all, that society needs to receive sufficient benefits in return for its efforts.

Why do we think that more people and resources should be directed towards those points in the system where health gains can be achieved and public values upheld? One reason is the relatively limited spending on preventive medicine and interventions over several decades; together with child and youth care services, these activities are allocated the least resources overall (see Fig. 7.2).⁵² Despite repeated calls over many years for greater commitment in this area,⁵³ its share of spending has fallen steadily since the turn of the millennium. Yet research shows that a whole range of preventive intervention can achieve tangible health gains at relatively low social and financial cost⁵⁴ (see Table 7.2 and Box 7.6)—certainly when compared with some forms of curative medicine. Moreover, effective prevention could also bolster the sector’s societal sustainability. Take the pressure on solidarity associated with lifestyle-related ailments, for instance (see Chap. 3): these are perfect examples of conditions that preventive measures can help avert or suppress. And in some forms, such as excise duties and so-called “sin taxes”, these actually generate money rather than costing it (see Table 7.2). This does not mean that investing in prevention will automatically result in financial savings, but it does mean that this approach offers great potential to achieve health gains—and often at relatively low cost compared with those attainable through other forms of intervention (see Box 7.6).

Table 7.2 Examples of potential health gains and cost-effectiveness

Box 7.6: Does Prevention Save Money?

There is often an implicit expectation that preventive medicine and interventions save money and so, by extension, that investing more in these activities will reduce overall healthcare spending. After all, “prevention is better than cure”. If a person stays healthy, surely that costs nothing? Unfortunately, things are not always that simple. And for various reasons.⁵⁵ One is the fact, discussed earlier in this report (see Chap. 2), that a large proportion of the expenditure is incurred just before death (see Chap. 2). Prevention does not necessarily change this, it just defers those costs. Another is that prevention can extend life expectancy, but in some cases with much of that extra time spent in poor health (“expansion of morbidity”). Then there is the possibility that the burden of disease simply shifts. Fewer smokers means a lower prevalence of lung cancer, for example, and so more people living longer, but some of them will go on to develop dementia later in life. That “surrogate” condition may be cheaper to treat, but it could also prove more expensive.

So the net effect of preventive medicine is not always clear in advance, is shrouded in uncertainties and varies greatly between interventions. One of the preliminary studies for this report summarizes its benefits and those of other forms of care.⁵⁶ The broad picture is that it cannot be said that “prevention” in general reduces care costs. What is apparent is that many preventive interventions are by far the least costly way to generate extra healthy years of life. And in many cases prevention is simply the most effective means to improve the health of a large group of people, notwithstanding the cost.

However, a greater commitment to prevention is not just a matter of investing more money. Many preventive interventions cost little or nothing, and some even generate revenue—quite apart from the health benefits they bring. These are often legislative measures such as the so-called “sugar tax” (see also Table 7.2); the preliminary study by National Institute for Public Health and the Environment (Rijksinstituut voor Volksgezondheid en Milieu, RIVM) provides a list.⁵⁷ The issue with instruments of this kind is not so much one of resource allocation or distribution, then, but more normative: to what extent can and do we restrict people’s individual freedom in the interests of their own future health? Effective, well-designed incentives and deterrents are an important factor here, and sometimes also the realization that we have to override short-term concerns for the sake of long-term health gains.⁵⁸ We look in greater detail at the social and institutional barriers to more widespread prevention in the next chapter.

7.4.2 Commitment to Public Values

Illustrative of the lack of systematic prioritization between different fields in health and social care is the position of those where public values are not being sufficiently upheld. In Chap. 4 we showed that quality and accessibility are under particular pressure in child and youth care services, specialist mental healthcare and care for vulnerable elderly people. Yet looking at the first two of these, there are no signs that their financial situation is improving or that they are being prioritized for more resources (see Fig. 7.2). Their relative share of overall funding has remained remarkably constant for decades, and indeed actually declined due to the budget reductions accompanying their decentralization to local authorities in 2015. We have also seen (in Chap. 3) that substantial staff reductions occurred during the same period. On the other side of the coin, examination of the longer-term trend reveals a steady growth in the relative weight of hospital care—a field that performs well in terms of quality and accessibility as measured by OECD standards (see Chap. 4). According to the prognoses, this will remain so in the decades to come as growth within the sector, in both absolute and percentage terms, is concentrated in curative medicine and care for the elderly (see Chap. 2).

Investing in prevention is not only a generally effective and efficient way to achieve health gains, it can also help safeguard public values in fields where they are at risk. As we saw earlier in this chapter, the proportion of users with relatively minor complaints is currently on the rise in these fields, child and youth care services and mental healthcare amongst them. A stronger commitment to preventive interventions might actually reduce the influx of such straightforward cases, freeing up human, material and administrative resources for more patients with serious conditions. One example is measures to avoid the occurrence and aggravation of mental disorders (see Box 7.7) and of the need for youth care. Much the same applies in care for the elderly: to enable them to continue living at home, it is very important that they have a social network and remain mobile. In this respect, providing them with an exercise regime and fall-prevention measures are obviously beneficial interventions. It is also important to identify increased frailty over time, cognitive and mental as well as physical. However, the RIVM has found that there is still insufficient co-operation between care and assistance providers when it comes to early signalling of issues of this kind.⁵⁹

Box 7.7: Strengthening Preventive Interventions to Combat Mental Disorders

A growing body of data shows that it is possible to prevent mental disorders like psychosis, depression, alcohol dependence and suicide.⁶⁰ A meta-analysis of fifty randomized controlled trials⁶¹ involving people who had not been diagnosed with depression at the start of the trial and who then received either “preventive” cognitive behavioural therapy or “usual care” found that after one year the active intervention had led to a 19 per cent reduction in the risk of developing depression⁶²—albeit with the rider that it had a low absolute effect upon incidence and limited reach.⁶³ In addition to being clinically effective, the intervention also appeared to be cost-effective.⁶⁴

Both the lack of commitment to preventive medicine and the limited allocation of people and resources to parts of the care sector where public values are under pressure are, to a certain extent, the flip side of implicit prioritization decisions in other fields. Consider, for example, the strain on budgets discussed earlier in this chapter that results from automatically accepting quality improvements across much of curative medicine—and only exacerbated by the rapid development of medical technology (see Chap. 2). Or the increase in expenditure on long-term care for the elderly being driven by demographic factors. One-to-one substitution cannot be proven, but in a world of scarce people and resources all the various aspects of health and social care end up fishing in the same pond.

Key Points—Choices in Practice: Distribution Between Fields

• The broad distribution of resources between the different fields of health and social care in the Netherlands is determined primarily by historical patterns.

• Preventive medicine and interventions can achieve relatively substantial health gains at relatively low cost, but efforts in this field have remained at a fairly constant low level for more than two decades.

• Despite overall growth in the sector’s resourcing, fields where the quality and accessibility of provision are at risk—including specialist mental healthcare, child protection and youth care under judicial referral—have largely missed out.

• Preventive medicine and interventions can help curb the influx of care users and bolsters public values, especially in the fields where these are under pressure.

• The allocation of resources and people between and within sectors is only driven to a very limited extent by the potential to achieve health gains or to uphold public values.

7.5 Choices in Practice: Collective Versus Individual

So far, this chapter has dealt with the distribution of resources in health and social care. But another way in which boundaries can be drawn is from the funding side. Should people who use care be expected to contribute directly towards it themselves, and to what extent? Or should the entire cost be borne by the collective? The degree to which responsibility is invested in the collective is important for the sector’s financial sustainability, since it has a direct impact upon the financial burden that care places on collective resources. There are also potential indirect repercussions for human and financial sustainability, as out-of-pocket contributions such as co-payments can reduce the use of care provision (a behavioural effect).⁶⁵ Of course, the extent to which care use is charged for in this way may also affect the financial component of accessibility, although here much depends upon the exact pattern of distribution: who is expected to make contributions and what are their personal circumstances? Finally, there are potential effects for societal sustainability. These can be either negative or positive: negative if people are concerned about the consequences for the financial accessibility of care, positive if they consider it fair that the users of care should at least partly bear the costs themselves (see also Chap. 3). The net impact of these effects across the board is unknown.

The Dutch care system features direct charges in a number of areas, in particular a compulsory excess built into the basic statutory health insurance package under the Zvw, covering mainly curative medicine, and personal contributions for long-term care (Wlz) and social support (Wmo).⁶⁶ The Zvw excess is currently €385 per annum,⁶⁷ whilst the Wlz contribution is means-tested⁶⁸ and the Wmo requires a monthly “subscription fee” of €19 per beneficiary household. All of these charges are the subject of controversy in the public debate because they represent mandatory out-of-pocket fees for essential basic provision, and hence are unavoidable for patients in need of the treatment, care or support in question. Other forms of direct personal payment within the Dutch system, such as premiums for optional supplementary health insurance cover, are less contentious because the provision concerned is not generally regarded as essential.

Box 7.8: Amounts and Types of Direct Charge in the Netherlands and Elsewhere

Direct charges are an integral part of other nations’ health and social care systems, too. One variable we are able to compare internationally is the ratio of out-of-pocket payments to collective financing. In general terms, the proportion of direct charges in the Netherlands is slightly lower than the OECD average (see Fig. 7.3). In most neighbouring countries, with the exception of France, it is marginally (Germany, United Kingdom, Norway) or considerably (Belgium) higher.

Fig. 7.3

Total share of direct charges within health and social care financing in the Netherlands and other OECD countries. (Source: OECD, 2019b)

A WHO comparison shows that the Netherlands has the lowest level of out-of-pocket payments in Europe, 5.2 per cent, followed by France (6.3 per cent) and the United Kingdom (9.7 per cent).⁶⁹ Unlike in many other countries, moreover, the Dutch excess for curative medicine (under the Zvw) has a clearly specified upper limit. This protects lower income-earners with chronic conditions, in particular, against the “stacking” of care charges.

Compared with citizens of other Western countries, the Dutch incur relatively low direct charges (see box 7.8 and Fig. 7.3). Furthermore, their overall level has actually decreased over the past few decades (see Fig. 7.4). In recent years, too, the trend has been downwards. The Zvw excess, for instance, has barely increased since 2013, when it reached €350 per calendar year, and not at all since the current figure of €385 was set in 2016. In real terms this means that it has been decreasing slowly for almost a decade. The introduction of the Wmo “subscription” model in 2020 has also reduced the extent of out-of-pocket fees. None of this, however, alters the fact that these charges can be a substantial outgoing, especially for low-income households.

Fig. 7.4

Percentage of personal payments in Dutch health and social care. (Source: CBS Statline)

As well as their overall level, the manner in which direct charges are levied is also important. In particular, the extent to which the amount payable is directly related to the use of insured care. Two common methods are illustrated in Fig. 7.5. The x-axis shows a person’s total spending on care in a given year, the y-axis how much of that they have to pay out of pocket. In a system with a fixed annual excess (as under the Dutch Zvw), the patient first pays that amount in full but nothing more thereafter. Where there are so-called “co-payments”, by contrast, they pay a set amount for each new intervention. Under this arrangement the costs for the individual rise less quickly when he or she uses care, but there is a longer braking effect.

Fig. 7.5

Two models for levying direct payments for insured care: with fixed annual excess (top, the current Dutch Zvw system) and with set co-payments per treatment (bottom, as used in Germany, Belgium and other countries)

How direct charges are structured shapes the kind of behavioural incentive (or disincentive) they create. The situation under the Dutch Zvw—a relatively low excess by international standards—makes the threshold for the initial use of care relatively high, but as soon as that is crossed there is no longer any deterrent effect. In practice, this means that that effect is never a factor at all for most chronic patients because they know full well in advance that they will “use up” their entire policy excess in a given year. By contrast, a co-payment model along German or Belgian lines—possibly in combination with the same annual maximum contribution of €385 (the scenario depicted in the bottom diagram in Fig. 7.5)—would maintain the braking effect for longer. Another way to achieve a similar outcome is through a so-called “shifted” excess, whereby the patient only starts contributing personally once they reach a certain expenditure threshold (€400, say).⁷⁰ Depending upon the way co-payment is arranged, it can be more predictable for the patient because it is not linked to the total costs incurred by the insurer “behind the scenes”—information that is not very transparent for the patient and not easy to foresee—but only on the number and, perhaps, type of interventions undertaken. Such predictability can be especially important for those on very low incomes. Potentially, it might also bolster societal sustainability. Unfortunately, though, little is known about how various forms of co-payment affect this dimension; recent analyses only provide estimates of the overall financial and distribution effects of different ways of calculating co-payments.⁷¹

A third important factor with regard to the design of direct charges is the question of who should and should not pay them, and how much they should be. In the Netherlands, their levels under the Zvw and Wmo depend only upon the care received⁷² and not upon any other payer characteristics such as their age, gender or income.⁷³ In short, everyone using care pays the same for it.⁷⁴ In the case of social support (covered by the Wmo), this is a recent development: until the introduction of the “subscription” model in 2020, personal contributions were income-dependent.⁷⁵ Since the change the median income of families receiving youth support has been rising, presumably due to a pull effect on higher income-earners who are now asked to pay only a (lower) flat monthly fee.⁷⁶

On the other hand, personal contributions for long-term care (under Wlz) are still means-tested. Both income and assets are taken in account.⁷⁷ A wealthier user thus pays more than a poorer one for the same care. Similar arrangements are also common in long-term care in other countries. An international comparison of systems to fund care for the elderly, for example, showed that all the countries examined impose direct charges with income and/or asset-dependent components.⁷⁸ The most modest are in Denmark, where users only pay an income-related fee for board and lodging whilst the government funds all care proper from the collective coffers. The most stringent means-testing is in the United Kingdom; an elderly person there only qualifies for publicly-funded care if their total net assets are worth less than £23,250 (just over €26,000; 2020 figures). Such a low and absolute cut-off point implies that collective provision of long-term care for the elderly in the UK exists only as a last-ditch safety net, not as a broad service accessible to a significant proportion of the population.

Other criteria for means-tested payments, such as a higher or graduated upper limit, need not have this implication. Ultimately, society pays for all care in some way or another, but the way those costs are distributed is important. The precise function and form of means-testing is a political question, and the answer can and will be different for different aspects of health and social care. But before coming to that there is the matter of direct charges and the role they should play. Are they primarily a way of in inhibiting the uptake of care (the brake effect)? A means of distributing its costs fairly across different income and wealth groups? Or a way to give individuals a say in the type—and possibly quality—of care they receive, in line with their personal and economic circumstances? Here again, the socially desirable answers to questions like this will vary according to the nature of the care in question. In general terms, however, levels of direct charges and the precise form they take should be determined only once we have answered a more fundamental question: what is their purpose? Unfortunately, that is not the case at the moment, since in the Netherlands at any rate the public debate seems to centre solely on their amount and form.

Key Points—Choices in Practice: Collective Versus Individual

• Compared with other countries, direct charges for health and social care in the Netherlands are relatively low and their share in covering its overall costs has been declining in recent decades.

• The form direct payments take—who pays them and for what, whether they are means-tested and so on—is important due to their potential impact upon access to care.

• Direct charges in the Netherlands are generally linked only to the nature of the care concerned, not to other payer characteristics (especially their income or assets). The exception is the means-tested personal contribution for long-term care (under the Wlz).

• Direct charges can serve various purposes, from inhibiting the uptake of care to redistributing its costs.

7.6 Choices in Practice: Care Versus Other Sectors

Up until now we have looked only at the prioritization and distribution of resources within health and social care: should we reimburse treatment A or treatment B, invest in preventive medicine or long-term care and so on. But there is also a broader question, and one equally important for sustainability: how much do we allocate to care as a whole, rather than other public services? To a great extent the answer to this question is derived from the choices and decisions made within the sector, as discussed above: what provision is covered by the basic statutory health insurance package, how generous are defined rights and entitlements to long-term care and what do we expect patients and users themselves to contribute? All of these factors help shape spending on care.

Moreover, the level of that spending is closely related to the fact that, compared with other policy domains, the care sector in the Netherlands is in a unique situation with regard to its budgeting processes.⁷⁹ Other domains are allocated financial resources in each new government’s coalition agreement, in line with its political priorities and ambitions, and these amounts are then adjusted and honed during subsequent annual budget cycles. But that is not the case with health and social care.⁸⁰ Instead, the Netherlands Bureau for Economic Policy Analysis (Centraal Planbureau, CPB) forecasts the sector’s expected expenditure based upon a model that incorporates such factors as demographic developments and historical spending trends, including past growth as a result of the introduction of new forms of care and technologies. From this the CPB generates a so-called “baseline”, from which politicians can deviate in their decision-making, either upwards (more investment in care) or downwards (less investment). This is known as an “accommodating budget” since, rather than reflecting an outlook or political aspiration like the spending allocations in other policy domains, it “accommodates” what the care sector itself is expected to do.

We have described the underlying reason for this deviation from standard procedure earlier in this chapter. Across large parts of the sector—certainly those consuming the bulk of its resources—the government has only limited scope to “steer the ship” directly. In curative medicine, for instance—the main field governed by the Zvw and by far the largest in the sector—total spending, the volume of care provided and prices are determined largely⁸¹ by public demand and by interactions between patients, providers and insurers. The government does have some means to exert control in these areas, but to be realistic these are modest in their reach (adjusting the composition of the basic insurance package, for example) or not legally enforceable (outline agreements), or their effectiveness at the macro level is hard to predict and in practice often disappointing (as with substitution to promote cheaper forms of care and other efficiency measures—see Chap. 6). Similar dynamics are at play in other parts of the sector, too. Because much of social care has been devolved to local government, for example, “The Hague” is limited in its powers to intervene there as well. And since the CPB generates a baseline spending forecast only once during a government’s term, when it first takes office, it can only use its limited options relatively rarely.

The unusual budgetary procedure in the care sector has a number of practical and political consequences. For instance, it creates an implicit normative effect with regard to spending and volume growth because the baseline issued by the CPB serves as its frame of reference. This establishes a dynamic whereby that growth is not a conscious political choice but an automatic process. Downward deviations from the baseline are perceived as spending cuts even if there is a substantial increase in absolute expenditure. In recent decades the baseline increase in expenditure has systematically exceeded economic growth.⁸² Consequently, the political judgement as to whether rapidly rising spending on care is actually in the best public interest, or would these resources be of better use in other public policy domains, is not always aired explicitly.

Key Points—Choices in Practice: Care Versus Other Sectors

• Unlike expenditure in most other public policy domains, total spending on health and social care is estimated rather than budgeted.

• This puts the sector in a relatively dominant position in the overall policy arena. Deviations from the baseline estimate are perceived as cuts, even if actual expenditure increases.

• With regard to total spending on care and the allocation of resources within the sector alike, political and policy options to exert control are limited in both a formal and a practical sense.

• Consequently, the political judgement as to whether the public interest is best served by the existing system and the current distribution of resources within the sector is not always aired explicitly.

7.7 Impediments Affecting Choices and Allocation

This chapter centres on choices in the health and social care sector, both theoretical and practical. We have so far addressed a number of distribution-related questions. For example, how do we allocate people and resources within the sector? What treatments and other interventions do we choose? How much responsibility, financial and otherwise, do we place upon the individual? How much do we invest in care at the expense of other public services? And for all of these questions, how do we decide? From the sustainability perspective, our analysis of choice processes in Dutch health and social care produces a number of interrelated conclusions—all linked to the single observation that, given the increasing role being played in this sector by scarcity, the three dimensions of sustainability will in the future require that priorities and choices associated with that scarcity be determined in a better manner. Because the implications and effects of these choice processes extend to and often aggravate sustainability-related issues, we formulate the conclusions below in terms of impediments to good choices with regard to the allocation of people and resources in health and social care. In order to identify those impediments, we sometimes refer back to earlier chapters in this report.

Impediment 1—Automatic Inflow of New Care

Firstly, in curative medicine only a very small proportion (5 per cent) of new forms of care and treatment covered by the Dutch statutory basic health insurance package are subject to an explicit advance authorization procedure to test their health benefits against their cost (cost-effectiveness). The vast majority are admitted via the so-called “open” route, effectively meaning that quality improvements are generally accepted automatically for reimbursement from collective funds. This puts healthcare in a unique position within the public sector. In education, for example, new technologies and other innovations with potential quality benefits require explicit political consideration before they are implemented.⁸³ Since the bulk of care-related advances in the real world are in curative medicine, this impediment also has repercussions for relationships between the various aspects of health and social care: it strengthens the position of rapidly improving fields like curative medicine at the expense of those where the rate of progress is more sedate. They include child and youth care, mental healthcare and care for the elderly.

Impediment 2—No Systematic Outflow Management

Secondly, managing outflow from the statutory package—the exclusion or abandonment of forms of care and treatment no longer deemed appropriate—appears to be just as tough a challenge as regulating inflow. From the sustainability perspective, both are equally problematic; after all, a comprehensive yet efficient package can only be maintained by keeping a constant eye out for “obsolete” interventions that can be dropped from it. In part, the problem here is lack of information: for a very substantial proportion of all care provided within this package—thought to be about 40 per cent—we simply do not know whether or not it is appropriate.⁸⁴ But even when it is actually known to be inappropriate, which applies to an estimated 10 per cent or so of the total, in practice outflow does not necessarily follow. This is due to a combination of disincentives, habit and vested interests. And what it shows is that making sustainability-related choices in healthcare is an issue not only for the world of policy, politics and public administration, but also one influenced to some extent by decisions taken in the consulting room. Obviously, this situation is particularly undesirable from the patient’s point of view; by definition, after all, inappropriate care is not in their interest. But it also has sustainability implications, because such care makes claims on people and resources that are not—or not sufficiently—offset by benefits. This can result in the implicit displacement of other, more effective care. Which, in essence, is a form of allocative inefficiency.

Impediment 3—Limited Knowledge of Clinical, Therapeutic and Cost-Effectiveness

Thirdly, in large parts of the sector assessment of clinical or therapeutic effectiveness of the care provided—and by extension its cost-effectiveness—is limited. In fields like long-term care, but also certain aspects of mental healthcare and child and youth care, systematic evaluation is even less common than in curative medicine. Measuring and objectively appraising therapeutic effectiveness—and hence cost-effectiveness—are inherently more difficult in these fields because the benefits are harder to quantify. Moreover, their research culture is less well-developed and the use of available instruments such as ICECAP is limited. Across much of the sector, therefore, we have little insight into whether people and resources are deployed prudently from the sustainability point of view. This creates the risk that they are diverted into forms of care that generate only limited health gains or improvements in quality of life.

Impediment 4—A Sustainability Imbalance: Financial Considerations Dominate

A fourth impediment is that choice processes in health and social care often upset the equilibrium between the instruments put in place to guide the three dimensions of sustainability, or between sustainability and public values. In most cases this imbalance involves financial considerations overshadowing the other factors. One example, already discussed in Chaps. 3 and 4, is the drastic staffing cuts undertaken in mental healthcare, in child and youth care services and in nursing, residential and home care as a result of the pressure to make cost savings. Financial considerations can quickly come to dominate political and administrative decision-making because they are easy to measure and often relatively straightforward for policymakers to direct. As the issue of staffing sustainability becomes more acute, however, manpower will also become a constraining factor. Indeed, we have this occur already in the case of the quality framework for nursing homes discussed above, under which resources were released to improve quality but the staff needed could not be found.

Impediment 5—Short-Term Policies Dominate Choice Processes

One final impediment is the prevalence of short-term thinking in politics and public administration. It is not so attractive to invest in forms of care with benefits that will only materialize in the longer term, and if you do they are prone to cutbacks further down the line. Preventive medicine is a classic example. In many cases, its positive outcomes only emerge years—sometimes even decades—later. This makes it less appealing than forms of care that yield results much sooner. Another related aspect is the visibility of a health problem and the gains to be achieved from tackling it. Some conditions are relatively invisible to the general public; various kinds of mental disorder, for instance, are responsible for a large burden of disease but less apparent than with obvious physical ailments. We look at this impediment in more detail in the next chapter.

Choices in Care as a Sustainability Issue

The current distribution of people and resources across the health and social care sector is less than ideal when it comes to delivering health gains, improving quality of life and safeguarding public values. This is largely down to the impediments listed above. So they are what politicians need to address in order to achieve greater health gains and to safeguard public values. In particular, that means actively strengthening their commitments to preventive medicine and to those aspects of care where public values are under pressure.

But what does this analysis have to do with the sustainability of health and social care? The link is the scarcity factor discussed earlier: the ever more stringent financial, staffing and societal constraints on the sector’s growth. We began this chapter with the notion of allocative efficiency: are we doing the right things? With scarcity on the rise, the impediments to the process of making choices in that respect are becoming more and more significant. Which in turn makes it increasingly important to ensure that the choices are made in a better way. This does not mean aiming to shrink the sector, but rather that we need to pursue more selective growth. This issue of prioritization in care is intrinsically normative in nature. After all, it is ultimately about what we as a society regard as fair and important. For example, to say that it is problematic that the quality and accessibility of care in some fields have fallen below par is a normative judgement. It is therefore important to emphasize that the underlying motive for making better choices is not financial; in fact, the aim is to safeguard the quality and accessibility of care within the parameters of the available people, resources and public support, not to save money as an end in itself. It is precisely in order to be able to continue to uphold these public values that it is inevitable that choices will have to be made, so that people and resources are freed up for the parts of the system where those values are under pressure. Sometimes those will be tough choices. Not everything that is possible technically and medically will actually be done. The next chapter therefore addresses the difficult question of how to deal with this dilemma.