"Everyone we spoke with, in every country, told us they are afraid their current health system was not built to last", stated Jim Henry, global leader for Healthcare, PricewaterhouseCoopers. "Most countries have some aspects of their health system that are working, but no one country has the magic bullet. We need to rise above nationalism and turf protectionism, learn the lessons of other countries and sectors, and build on the best ideas. What's clear is that no one government can solve the health care problem. It will be up to governments, working together with private industry and consumers who not only have a bigger financial stake but also a greater responsibility in their health care."
The report, called "HealthCast 2020: Creating a Sustainable Future", finds a convergence of trends and solutions in the global health care market, including the way health care is funded. Countries are moving toward greater shared financial responsibility among the government, the private industry and consumers, even in historically tax payer and employer-funded systems. The report also found that consumerism, the use of information technology, incentive realignment and new reimbursement models such as pay-for-performance are soaring globally as nations seek to reduce health care costs and improve access, safety and quality for their citizens.
More than half of those surveyed by PricewaterhouseCoopers expect health spending to accelerate at a greater rate in the future than in the past. Health spending patterns also are becoming more similar among countries in the Organization for Economic Cooperation and Development (OECD), although United States spending remains the highest in the world. Americans spend 53 percent more per capita on health care than the next highest country, Switzerland, and 140 percent above the median for OECD countries. PricewaterhouseCoopers projects that global health care spending will triple over the next 15 years to $10 trillion, consuming 21 percent of gross domestic product (GDP) in the United States and 16 percent of GDP in other OECD countries.
The report highlights best practices and common trends in health systems around the world. There is wide support for shared financial responsibility among private and public payers. More than 75 percent of health leaders and policy makers believe that financial responsibility for health care should be shared. Only a minority of industry leaders in the United States, Canada and Europe think that a mostly tax-funded system is a sustainable system. Even in systems where health care is primarily tax-funded, such as in Europe and Canada, only 20 percent of respondents favour that approach. Despite calls for universal health care in the United States, only 6 percent of United States respondents favour a mostly tax-funded system.
United States health spending already is 46 percent tax-funded and growing as Medicare/Medicaid programmes expand. Market reforms in government-run systems such as England, The Netherlands and Germany are increasing use of co-pays or providing compulsory insurance coverage with the option to add services through supplemental private insurance.
Consumerism is changing the way health care will be delivered. As patients pay more for their own health care, they are demanding accountability and information about pricing, safety and quality to make better decisions about what they are "buying". Health care organisations will have to publish or perish, and, like the automobile and airline industries, are beginning to report their prices, error rates and safety standards. Eight in 10 executives surveyed said that transparency will be one of the most important features of a sustainable health system. Two-thirds believe hospitals are currently unprepared to meet the challenges of empowered consumers.
To promise world-class care to its citizens, Hamad Medical Corporation in Qatar is working to be a Joint Commission International-accredited hospital. As part of a safety assurance initiative, the United Kingdom has adopted a non-punitive medical error-reporting system based on a model used by the United States Federal Aviation Administration.
Focus is shifting to wellness and prevention. Preventive care and disease management were cited by two-thirds of respondents as the most important ways to reduce health care costs and manage demand on health systems. Health promotion and wellness initiatives are being sought voluntarily by employers and mandated by governments.
Ireland was first to place a country-wide ban on smoking indoors, and this has since spread to other countries. The Swiss are considering a tax on food with high glycemic content. The United Kingdom is considering a "traffic light" nutritional labeling system on foods to make it easier for consumers to make healthy choices.
Pay-for-Performance is soaring. Misaligned incentives are identified as a root cause of gaps in the quality in health care and inequitable sharing of risk and rewards. Eighty-five percent of organisations surveyed say they have begun moving toward pay-for-performance initiatives, a significant increase in the past two years.
Physicians in California receive bonuses for screening patients for conditions that are expensive to treat, such as cervical cancer and coronary heart problems. The Dutch will introduce a new health insurance system in 2006 that realigns their incentive structure. Spain is using patient choice as a lever for changing physician behaviour.
Information technology is the backbone of care. Lack of care integration was cited as the biggest problem facing health delivery systems, according to more than 80 percent of respondents. Three-quarters of respondents viewed information technology as most important to integrating care (74 percent) and information sharing (78 percent).
The National Health Service (NHS) in the United Kingdom is committing $12 billion over 10 years to build a national health care information network, and requires some physicians to use computers to get paid. The Canadian government is building the Canadian Health Infoway. The United States has a goal to build a national medical record system. Australia is considering making electronic reimbursement mandatory.
Innovative, flexible care models are emerging. Many countries are exploring more innovative, adaptable care models to increase access and productivity and to circumvent workforce shortages. This includes hospital redesign, use of technology, outsourcing of elective procedures and importing of nurses and other clinical staff.
Norway is using telemedicine to provide health care in remote areas. A German company is buying smaller hospitals and connecting them to specialized, centralized high-tech medical units. More than 100 smaller, speciality hospitals have been built in the United States in the past five years. In Australia, 45 hospitals now offer "Hospital in the Home".
"Innovative solutions to common health care problems are emerging in the global health care market", stated Sandy Lutz, director of research for PricewaterhouseCoopers Health Research Institute. "Governments and health care organisations across industries and sectors must find a way to share ideas and work together in ways that they have not in the past."
HealthCast 2020 identifies seven common features for sustainability that include the need for common ground among stakeholders; a digital backbone; incentive realignment; quality and safety standardization; strategic resource deployment; innovation and process change; and adaptable models of care delivery centred on the needs of patients.
The report includes survey responses from 578 health care executives, policymakers and employers from 27 countries to assess their opinions about health systems sustainability. PricewaterhouseCoopers also conducted in-depth interviews with more than 120 health care thought leaders in 16 countries, including Australia, Canada, Europe, India, Japan, Singapore, South Africa, the United Kingdom, the United States, as well as in the Middle East.
PricewaterhouseCoopers Health Research Institute provides new intelligence, perspective and analysis on trends affecting all health-related industries, including health care providers, pharmaceuticals, health and life sciences and payers. The Institute is part of PricewaterhouseCoopers' larger initiative for the health-related industries that brings together expertise and allows collaboration across all sectors in the health continuum.
People interested in receiving a full copy of "PricewaterhouseCoopers HealthCast 2020: Creating a Sustainable Future report", or charts may send an e-mail request.