Netherlands’ Health Care System Could Serve as Model for U.S. System
The Netherlands last year enacted a health care system that uses "competition and a small dose of regulation to pursue what many in the U.S. hunger to achieve: health insurance for everyone, coupled with a tighter lid on costs," the Wall Street Journal reports.
The Dutch system, which took effect on Jan. 1, 2006, requires that all adults purchase health insurance and that all insurers offer a policy to anyone who applies, regardless of age or health. Individuals who cannot afford health plan premiums receive subsidies financed by taxes on higher-income residents. The government compensates insurers for providing coverage to high-risk patients by granting "risk-equalization" payments for companies that insure the elderly and individuals with one of 30 diseases, including diabetes, heart disease and other ailments.
The system "hinges on competition among insurers," who are "expected to cut premiums, persuade consumers to live healthier lives and push hospitals to provide better and lower-cost care," the Journal reports. In addition, the system puts "the onus on consumers," which Dutch officials hope will allow more residents to "get the coverage they need," according to the Journal.
To protect physicians, who were concerned the system would allow insurers to influence medical decisions, the system prohibits patients from bearing a large financial penalty for using a physician not under contract with their insurer, among other provisions. The government also negotiated with generic drug manufacturers to lower prices by about 40%.
However, according to the Journal, the "real test of the Dutch approach is yet to come: Can insurers push hospitals to lower their costs and improve their quality?" Hans Hoogervorst, who was the health minister from 2003 to early 2007, said, "There's still a long way to go to increase competition among hospitals."
According to the Journal, "[w]hat works in the Netherlands, a small country of 16.6 million people, may not readily apply to America" because it "would likely raise opposition among U.S. doctors and Republicans who are cautious about higher taxes." However, "many U.S. states are similar in size, and one, Massachusetts, is already experimenting with a universal coverage scheme," the Journal notes.
"The lesson for America is that this is what we ought to do," according to Alain Enthoven, a professor at Stanford University who 30 years ago published a proposal for "managed competition," a version of which became the Dutch system (Naik, Wall Street Journal, 9/6).