The Netherlands spends the second most per-capita on health in Europe, and healthcare was a very important issue in the recent Dutch elections. Hans Maarse looks at the future of long term care in the Netherlands, which makes up for more than 20 per cent of expenditure on healthcare. With an ageing population, simply spending more on healthcare is no longer an option, and parties from both sides of the political spectrum have proposed reforms such as retrenching personal budgets, reducing bureaucracy, stressing individual responsibility, and, most controversially, moving from a rights-based to a provision-based scheme.
In the recent election in the Netherlands healthcare played a prominent role in the political contest; in the lead up to the election Socialist Party leader Emile Roemer accused liberal VVD leader (and Dutch Prime Minister) Mark Rutte of lying about plans to raise private payments. Debates about healthcare in the Netherlands are no surprise given that the annual growth rate of total expenditure on health (real terms) over the period 2002-2010 averaged 4.4 per cent. The Netherlands is now the second biggest spender on health in Europe; only Switzerland spends more ($5,056 USD versus $5,270 USD per capita in 2010). Future projections indicate that health care in 2040, depending on the assumptions made, will consume between 19-31 per cent of GNP, compared to 13.2 per cent in 2010. In light of these projected increases, there are great concerns on its long-term financial sustainability. Many feel that hard measures are required to avoid a substantial crowding out of private and non-health public expenditures.
The rapid growth of total expenditure on long-term care (LTC) for the elderly is seen as one of the major drivers of the current ‘spending crisis’. Between 1998 and 2010 expenditure on LTC for the elderly more than doubled and in 2010 it accounted for 21 per cent of total expenditure on health. A recent OECD-report on LTC found that in Europe only Sweden spends a higher percentage of its GNP on LTC.
LTC for the elderly is known as a well-developed part of Dutch health care. It is shaped as a mainly publicly funded service delivered by private not-for-profit providers. The Exceptional Medical Expenses Act (AWBZ), in place since 1968, covers the bulk of expenditures, and is a national mandatory, largely contribution-based scheme which pays for the costs of personal and nursing care, counseling, medical treatment in nursing homes and accommodation. The share of co-payments has declined from 8.8 per cent in 2002 to 7.2 per cent in 2011. Most clients apply for care-in-kind, but since the mid-1990s they may also opt for a personal budget to enable them to purchase health services privately. Another arrangement is the Social Support Act (WMO), in place since 2007, which pays, amongst other things, for domiciliary care. Municipalities receive a state grant to provide services which were previously covered by the AWBZ.
In only ten years the political agenda towards LTC has fundamentally changed. Around the turn of the century reducing waiting times to socially acceptable lengths was the first priority of governments. The solution was simple: higher spending. But it has become increasingly clear that this policy needs drastic revision for LTC to be sustainable in the future.
Over the last few years the government took several measures to rein in the growth of expenditure on LTC. For instance, it reduced the coverage of the AWBZ by removing some personal assistance services from the benefit package and making the eligibility criteria more stringent and uniform. Another measure was to increase the role of municipalities with the transition of domiciliary services from the AWBZ to the WMO as prime example. Policymakers assume that local government is best informed about the local situation and also best capable to deliver efficient, client-centered and integrated support to LTC-clients because of its responsibility for various adjacent policy areas including housing, welfare programs and local planning. Presumably the most controversial proposal was to implement a substantial retrenchment of the personal budget arrangement according to which only a small percentage of clients would retain the option of a personal budget. Not surprisingly, the proposal was heavily disputed and when the government fell in 2012, the political crisis was immediately seized as an opportunity for mitigation.
On a more fundamental level, the government also sought to initiate a debate on individual responsibility for LTC. In its view individual responsibility has to be reinforced to keep LTC accessible to those who really need it. Elderly people should live as long as possible autonomously in their own environment and the use of intramural services needs to be scaled down. However, reinforcing individual responsibility is not only a highly ambiguous concept; it is also a controversial strategy that keeps parties deeply divided.
In the run up to the recent elections, the future of LTC was a hot topic. Left-wing political parties argued that hard measures that would severely hit elderly clients could be largely avoided, if there was less bureaucracy, fewer managers, if overpaid chief executives had substantial salary cuts and if LTC was not delivered by costly provider giants but small-scale organizations in the local community. Other parties have called for more fundamental reforms, for instance by ‘delisting’ various services from the list of publicly funded services.
Remarkably, one element hardly received attention in the political debate and that is the future of the AWBZ. In its present form, it is a truly social health insurance scheme giving each person a right to care if (s)he meets the eligibility criteria. Most parties proposed one way or the other, that the rights-based financing scheme of LTC should be converted in a provision-based scheme. This sounds like a technical measure, but it potentially has great consequences because it essentially means that LTC will lose its rights-based structure. Municipalities or other implementing agencies will no longer, or to a lesser extent than at present, be bound to national and uniform regulations to achieve equal treatment of equal cases and will have much more discretionary power to render tailor-made care.
The radical transformation of the AWBZ may ultimately culminate into a considerable privatisation of LTC and convert publicly funded LTC into a residual kind of provision. The shift from a rights-based to a provision-based approach is in fact already practiced under the Social Support Act. For instance, municipalities are free to decide about the size of the budget for their WMO-activity and if the budget is exhausted, they are not obliged to provide additional resources. They may also consider the caregiving potential of family members and/or the wider social network of the applicant.
It is difficult to predict what will be realised out of these radical proposals. Institutional countervailing forces tend to be strong and the practical consequences of reforms may be less radical than it appears at first sight. Furthermore, one should not forget that retrenchment programs in LTC are politically highly disputed. Politicians well realise that the ageing of the population means that the electorate is ageing as well.
A longer version of this article appeared in Eurohealth, a quarterly publication produced by the European Observatory on Health Systems and Policies at LSE Health.
Note: This article gives the views of the author, and not the position of EUROPP – European Politics and Policy, nor of the London School of Economics.
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Hans Maarse- University of Maastricht
Professor Hans Maarse has a full chair in Health Care Policy Analysis in the Faculty of Health Sciences of theUniversity ofMaastricht. His main fields of interest are health care finance, the institutional structure of health care policymaking, the international comparative analysis of health care systems and the impact of the European Union on national health (care) policies. Recently, he directed a study on the possibilities and effects of market competition in Dutch health care. He has published studies about the impact of market competition in health care and about political decision-making on the package of health services (benefits) in public health insurance arrangements in Europe.