Resource Allocation In Global Health Systems

Resource allocation appropriately satisfies competing demands on systems to control costs, while providing sufficient access to care for most people, says Rajarshi Sengupta

Globalisation of health has evolved in stages, creating both opportunities and challenges. These stages can be divided into 'Fundamental' from 1950-1970, 'Discovery' from 1970-1990, 'Reactive' beginning in 1990 and estimated to 'Transition' in 2010 to the 'Sustaining' stage that will define the next decade. In this article, I will concentrate on why innovation, technology and process changes are a means to continuously improve treatment, efficiency and outcomes; and how adaptable flexible care settings and expanded clinical roles provide avenues for care that are centered on the needs of the patient.

The groundwork for global convergence began in the fundamental stage, which focused on access to care and public health initiatives. This stage led to the discovery stage, in which pharmaceutical companies were the first to broaden their reach as the need to innovate and compete prompted them to seek global partners.

During the reactive stage, health systems used global solutions to combat their problems. For instance, to fight local labor shortages in nursing, Filipino, Caribbean and South African nurses are aggressively recruited by England and the US Unfortunately, this solution, as with others during this stage, is not sustainable. In the case of international recruitment, this is leading to a massive 'brain drain' in the home countries, as healthcare professionals leave for better opportunities in more developed countries. The sustaining stage, in contrast, will focus on long-term solutions. This will come during a time when global tourism is expected to triple, escalating the risks of disease migration.

Unsustainability Of Global Health Systems

Globalisation of health brings enormous opportunities, but is overshadowed by common threats. Bloated costs, uneven quality and inequitable or mismanaged access threaten the sustainability of health organisations, systems and populations. More importantly, rising healthcare costs and related increases in corporate spending can weaken the ability of developed economies to compete globally, threatening to destabilise those economies.

Population growth and shifting demographics toward an aging population are frequently mentioned as root causes for unsustainability. However, these issues alone are not making health systems unsustainable. For instance, Italy, Japan and Spain - three of the fastest-aging countries - spend less per capita than the US. Despite beliefs to the contrary, aging ‘Baby Boomers’ in the US are contributing a small per cent of the increase in health spending, and are not a major driver for increases that are far above the overall inflation rate. Rather than blaming aging as a problem, it should be celebrated as a success. A longer, high-quality and productive lifespan is the goal of most health systems. There is, however, concern about the decreasing proportion of populations who will be paying into publicly-funded healthcare systems.

Features Of Sustainability

Sustainable systems demonstrate some or all of the following seven features:

Quest For Common Ground: A vision and strategy is needed to balance public versus private interests in building an infrastructure and in providing basic health benefits within the context of societal priorities.

A Digital Backbone: Better use of technology and interoperable electronic networks accelerate integration, standardisation and knowledge transfer of administrative and clinical information.

Incentive Realignment: Incentive systems ensure and manage access to care while supporting accountability and responsibility for healthcare decisions.

Quality And Safety Standardisation: Defined and enforced clinical standards establish mechanisms for accountability and enhanced transparency, thereby building consumer trust.

Strategic Resource Deployment: Resource allocation appropriately satisfies competing demands on systems to control costs while providing sufficient access to care for the most people.

Climate Of Innovation: Innovation, technology and process changes are a means to continuously improve treatment, efficiency and outcomes. Adaptable Delivery Roles And Structures: Flexible care settings and expanded clinical roles provide avenues for care that are centered on the needs of the patient.

Here, I will explore how strategic resource deployment, innovation and flexible roles and structures can contribute to the goal of sustainability of health systems around the world.

Strategic Resource Deployment

Patients experience illness as a continuous event in which various health services are required. A patient's illness event challenges provider organisations to create smooth referral and information handoffs between those whom deliver services in outpatient settings, hospitals, homecare etc. Separate financing streams have reinforced care being delivered in separate organisations and typically have not matched the patient's need for seamless healthcare service delivery. The integration of the care across the chain can result in better quality care and efficiencies.

The methods for integrating care need to be consistent with the social and political context in which they are implemented. Finding the appropriate balance between individual choice versus solidarity is key. For instance, when asked about how care could be better co-ordinated, HealthCast 2020 survey respondents in the US thought the onus should be on patients, who receive education about treatments and providers. Respondents in Government-funded systems in Europe and Canada clearly favored organisational integration, which is easier through single-payer systems than fragmented ones. This philosophy translates into degrees of financial involvement by consumers.

As healthcare systems attempt to allocate resources appropriately, they face the following challenges:

• Health systems revolve around needs of clinicians.
• Capital is scarce to renovate and rebuild.
• Capital and reimbursement are focused on hospitals and acute care.

Transferable Lessons

Organise Care Around The Patient: In Victoria, Australia, 45 hospitals offer Hospital in the Home, a Government initiative that provides hospital-level care, such as intravenous antibiotics, post-surgical care, non-surgical care, non-surgical wound management and chemotherapy. Alfred Hospital, now one of the largest metropolitan programmes with one of the highest acuity rates, provides 24-hour on-call support, including pharmacy resources and a medical doctor. Patients are reviewed regularly in clinic by their medical doctors and allocated an 'Alfred @ Home co-ordinator'.

Orbis Medisch en Zorgconcern, a healthcare provider in the Netherlands, is vertically integrating a chain of services around patient needs. This means connecting the entry points for care (the general practitioner) with the process of referrals to the hospital using enabling technology, such as a shared electronic patient record. Co-ordination continues at the point of discharge from the hospital with rehabilitation and home care providers.

Better-Aligned Incentives For Providers: Move Information, Not People: Norway, a country with vast expanses where few physicians live, has turned to telemedicine. In Oslo, the ratio of patients to specialists is 291 to 1, while in rural Finnmark, the ratio is 1,194 to 1. This situation is exacerbated by long distances and a cold, difficult climate that makes travel troublesome, especially during the winter. In 2004, the Norwegian Government spent 1.9 billion NOK (165 million GBP) transporting patients to and from hospitals, most often located in regional centres.

The disruptive nature of treatment discouraged patients from seeking care until it was urgent, often increasing the severity, recovery times and potential complications. Government leaders, who faced traditional (and expensive) third-party funding, were looking for incentives to more efficiently use capacity and locally developed solutions. In 2003, the Government began a phased transfer of both the funds and responsibility for travel to the five regional health authorities. Norway's Government leaders led with a logical premise: change the incentives to enable moving information instead of patients. To enable telemedicine, several efforts had to be accomplished:

• New processes to recognise and document e-health treatment.
• Co-ordination of IT systems and administration to effectively link the network of providers.
• Greater standardisation of care protocols to reduce variation in treatment.
• Reimbursement methodology to track services provided.

Anticipate Cream-skimming: Financial incentives embedded in competitive markets often skew the market. Most respondents of the HealthCast 2020 survey said the biggest risks to such incentives are healthcare organisations targeting high-profit procedures, followed by a lack of focus on areas not covered by incentives. In such cases, the Government often must step in to regulate the competition, ensuring that proper incentives create sustainability.

For instance, in Singapore, two groups provide public sector care: Singapore Health Services and National Healthcare Group. Each group has hospitals, specialist clinics, specialised medical centres and polyclinics. Competition between the two groups changed when reimbursement moved from piecemeal funding to a block fund allocation, which prompts the two systems to refer cases to each other and thus not incur the cost.

Think Small: Health systems are attempting to move closer to patients with smaller units that are less expensive to build. For instance, the explosion of small, specialty hospitals and ambulatory surgical centres in the US is bringing care closer to patients and clinicians. More than 100 specialty hospitals were built in the last five years in the US.

Among the executives of German hospitals surveyed in 2005 by PricewaterhouseCoopers, 120 CEOs and CFOs see a process of consolidation in the German market that will lead to a smaller number of hospitals in that country. This evolution to seamless services and ambulatory treatments in the German market is expected to be supported by an emphasis on prevention/self-treatment, primary care, day clinics, and telemedicine.

Adaptable Delivery Roles And Structures

Rigid clinical roles, cultures and structures are detrimental to sustainable health systems. Technology is eliminating some jobs and creating new ones in informatics and pharmacogenomics. It is also opening the possibility for more care to be delivered in outpatient clinics, offices, and even homes.

Hospitals traditionally have required patients and clinicians to come to them. Most hospitals were built on an in-patient chassis that has been expanded, re-modeled, and altered into consumer-unfriendly labyrinths. That model is changing. Patients and clinicians are finding other avenues to care that are more convenient, and technology ensures that caregivers connect to the best and brightest clinicians globally.

But delivery structures also have numerous problems, according to the HealthCast 2020 survey. When asked to rank those problems, more than 80 per cent of the respondents placed two labour issues above the others: staff shortages and training, and integrating care across providers and clinicians.

Sustainable health systems face numerous challenges in developing adaptable roles and structures:

• Trade groups, regulatory bodies and even consumers can be territorial and inflexible about clinicians' roles.
• Shortages are worsened by population shifts and poaching, which produces uneven distribution of clinicians.
• Training programmes often lag market demands.
• Clinicians are increasingly crossing borders, creating issues around licensure, quality and safety.

Transferable lessons from the above are as listed:

Leverage Nursing More Widely: When HealthCast 2020 survey respondents were asked which stakeholder had succeeded the most in improving communication, nurses were in the top. This acknowledgement of nursing skills coupled with ongoing shortages emphasises the role nurses play in meeting consumers' expectations for 'high touch' healthcare delivery. The roles of nurse practitioners (NPs) are expanding globally. In England, patients often prefer to see a physician, but the NHS is shifting more cases to NPs to ease physicians' workloads. In Australia, while physicians strongly resisted the move to allow nurse practitioners to practice independently, NPs now work in emergency departments, community care settings and within specialist teams such as mental health and drug and alcohol services. Some states in the US have extended prescription-writing powers to NPs, physicians' assistants, pharmacists, midwives, and naturopaths, who work under the supervision of physicians when they prescribe.

Programmes in several countries are adopting performance-based pay or creating career paths for nurse managers to increase retention. The NHS has decentralised payment and benefits to acute and foundation trusts, which are providing subsidised housing and other increased benefits to increase nurse retention.

Challenge Conventional Training And Licensing Models: If sustainable health systems expand the roles of nurses, they will need more nurses. Yet, most countries face shortages, primarily because the current systems to train, retrain and retain nurses are not working. By 2010, the nurse shortfall in the US is predicted to be 2,75,000, in the UK 53,000, and in Australia 40,000. As a result, many health systems are poaching nurses from the Philippines and other countries, but foreign recruitment from less developed nations is neither ethical nor sustainable.

Nursing and medical schools need to assess how to increase their pipelines. For instance, in the US, the Association of American Medical Colleges believes medical schools need to boost enrolment by 15 per cent over the next decade to meet predicted physician shortages stemming from population growth, aging Baby Boomers, physician retirements and female doctors who want to work fewer hours. An additional 2,500 medical school graduates annually would offset a projected physician shortage ranging from 85,000-2,00,000 by 2020. To combat the nursing shortage, some US hospitals are starting their own nursing schools.

Harmonisation of training and education requirements eases the movement of clinicians from areas with a surplus. The EU has set up a system for mutual recognition of professional qualifications for medical professions. Sectoral directives guarantee the mutual recognition of professional qualifications in the health sector (doctors, nurses, dentists, midwives and pharmacists) between member states. Some EU countries, such as Spain, Italy and Germany, report they do not have clinician shortages.

Climate Of Innovation

All health organisations, from the smallest local community provider to the most world-renowned university, have both a responsibility and an opportunity to foster innovation. Innovation can influence health policy and this is necessary for policy to respond to consumers' needs, for healthcare systems to be sustainable, and ultimately, for health to improve. For instance, sustainable health organisations must be innovative in the ways they adopt new medical information and biological technology. Often, technology is chastised as a cost driving up healthcare spending. Medical technology is widely viewed as a key driver of health spending increases. However, the failure to appropriately use technology and change management creates even more costs.

According to the HealthCast 2020 survey, IT is seen as an enabler in resolving healthcare issues rather than a solution in and of itself. The vast majority of HealthCast 2020 survey respondents viewed IT as important or very important to integrate care (73 per cent) and improve information sharing (78 per cent). However, a smaller percentage saw IT as important or very important for improving patient safety (54 per cent) or restoring patient trust (35 per cent).

As health systems move towards sustaining through appropriate innovation, they must solve the following challenges:

• Organisations resist change.
• Innovation in medical technology has resulted in earlier disease diagnosis, which can increase overall costs of treatment.
• Technology development and implementation requires significant capital investments, beyond the reach of many health organisations.

Transferable lessons from the above are as follows:

Customise Drugs And Care: Customising drugs and care is important to cover patients' genetic and cultural needs. Even as the industry becomes more global, care will become more personalised. Pharmacogenomics is changing the way drugs are discovered, tested, marketed and prescribed as the industry moves from prescribing treatment based on a patient's symptoms to therapies based on the patient's genetics. By identifying genetic markers associated with specific conditions, researchers expect to find targets for drugs or therapies to cure diseases, rather than just alleviate symptoms.

Listen To Consumers: In the future, a larger percentage of physicians will be women, some of whom approach the profession differently than men. In Australia, female general practitioners at a Brisbane medical center are able to charge USD five more per visit because they spend longer time with patients and cover more problems than their male counterparts. This has been accepted by patients seeking a more personal level of care.

For the elderly, BEI, one of the largest nursing home chains in the US, is styling many of its residential facilities to feel more like home, with meals served family-style and a front porch meeting area where ambulatory residents can congregate. In some regions of Italy, the elderly are given a voucher to pay for personal care at home from private organisations. The initiative is designed to reduce the demand for long-term beds as well as to improve the quality of life for the elderly population.

Conclusion

Transferable lessons are emerging. The variety is astounding, yet so are the commonalities. Around the world-and across all sectors of the industry-healthcare leaders are exploring many of the same solutions. The solutions related to the sustainable features in this article include:

Portfolio Management: Hospitals, pharmaceutical companies, life science organisations, and payers are increasingly called upon to manage their service portfolios in a balanced, fiscally responsible manner. Providers are organising and allocating services to meet consumers' needs for access, manage quality of care, and reduce duplication and inefficiency.

Manpower Management: New models of developing, recruiting, and retaining manpower are developing to address the root causes of gaps in service and impending future needs.

Across boundaries, languages and cultures, these are the strategies being employed by health systems across the world. The solutions are out there.

The writer is Executive Director at PricewaterhouseCoopers for Healthcare Practice in India