Hot topics covered at the Forum

Contribution of Research and Innovation Systems to Improving the Performance of Health Systems
Health Ministers Roundtable:

Do current government policies provide sufficient support for innovation? Are innovations in the health sector (e.g., new medicines and treatments) well-focused on addressing health conditions that are viewed as the highest priority? Are new models and partnerships needed to deliver greater convergence between innovation, health care needs and sustainable health care financing?

Health care innovation has transformed the practice of medicine over the course of the last century. Technological innovations, particularly in the fields of biotechnology, genetics, and information and communication technologies, are bringing substantial benefits in the prevention, diagnosis and treatment of disease, as well as access to care.
Such research and innovation is costly and is predominantly carried out in the private sector, drawing on knowledge created, in part, in the public sector science base. Innovation is also a risky process with many promising leads failing at successive hurdles before a safe, efficacious and high quality product is brought to the market.

Meanwhile, many OECD countries are seeking to establish health priorities. In principle, such priorities should take account of, and help guide, the direction of innovation - so a better match is delivered between innovation and a society's health needs.

However, there is only limited information on the practical steps that OECD member countries take to deliver such a match. Whilst a range of possible policy measures can influence innovation, such as direct research funding and premium pricing agreements for high priority innovation, current measures often lack coherence and clarity in the way they are applied. Indeed, some healthcare policies do not seem to take any account of the impact they have on innovation. Similarly, a number of countries are using foresight-type exercises (such as horizon-scanning) to identify possible future technologies, but there is little evidence of adapting health priorities to advances in the science base.

To avoid sending mixed or conflicting signals to innovators, it seems sensible that OECD countries consider how to develop and implement policies that deliver and direct incentives towards a better match between innovation and health priorities. Such consideration would have to take account of the realities of the innovation cycle, barriers, costs and likely investor behaviour. An aim could be to promote the development of more coherent innovation policies that take account of the evolving impact of R&D on health system performance, and deliver more efficient and purposeful R&D resource allocation - in both public and private sectors.

OECD health ministers and round-table participants might like to discuss whether a closer convergence between innovation strategies and health priorities is desirable and begin to share views on possible considerations that need to be borne in mind in taking steps in this direction.

E-Health and the Informed Patient:

What is the potential of e-health? What are the impediments? What does the emergence of the informed and e-ready patient mean for health care systems?

Health systems are facing tremendous pressure to improve the quality, accessibility and outcomes, while cutting costs. Digital delivery of goods and services offers great potential to address these challenges. Digital delivery is expected to influence all aspects of health care in the future.

A wide range of knowledge, goods and services in health are amenable to digital delivery, notably consumer-oriented health web sites, electronic exchanges between patients and providers, online health records, patient monitoring and home care, remote consultation, medical imaging, clinical transactions; research: e.g. biomedical databases, research collaboration and clinical research; teaching: e.g. distance learning and continuing medical education; and evaluation: e.g. peer review publication and data gathering for evaluation of impact of digital delivery on health outcomes and effectiveness of related ICT policy.

While some aspects of digital delivery such as claims processing are fairly mature, it seems that we are still at the tip of the iceberg in terms of exploiting the potential of e-health. Currently most consumer health oriented digital delivery applications are focused on providing information such as information on drugs and diseases. As individuals from the "baby boomer" generation age, develop more chronic illnesses and increasingly take responsibility for their own care while at the same time traditional health delivery channels become more stressed and overburdened them will seek more effective means to manage their health. Digital delivery is an ideal medium for providing personalized and responsive health management solutions.

The most common drivers for new digital delivery applications in health are cost containment or reduction, quality improvement and support, realisation of health policy such as universal access to care, and dramatic realisation of the benefits of international co-operation. However, the "e-ready" patient is emerging as perhaps the most important strategic driver in health systems. E-health consumers are more informed and more active. Consumers with chronic diseases are highly motivated to use digital delivery systems to improve their quality of life, particularly those with hypertension and diabetes which are chronic diseases which require high consumer involvement to prevent and control and also have a very high pay back in terms of future cost avoidance and improvement in quality of life. From the point of view of the consumer, the Internet has already become a critical resource when researching health information, making decisions about treatment options, and interacting with health professionals and organizations. Once the basic infrastructure for digital delivery is in place (most critically, the interoperability of diverse systems and acknowledging important privacy and security concerns), digital delivery is likely to diffuse rapidly if unevenly, and likely to lead to widespread impacts on healthcare.

The most significant and most common impediments to the growth and implementation of digital delivery are primarily human and organisational. Issues such as security and trust driven by the need to be confident in the quality of information as well as the need for privacy and confidentiality create significant drags on the rate of diffusion and implementation of digital delivery systems in health. Reimbursement rules that do not allow claims for services delivery electronically are another. There is a lack of rigorous evidence based case studies to convince decision-makers of the value of digital delivery applications in health care. Lastly, because benefits often accrue downstream from where investments need to be made to ensure readiness for digital delivery, political or competitive boundaries can hamper investment in the kind of system wide infrastructure that is required.

Obesity and Health:

What are the causes and threats of the rising obesity in many countries? What is the responsibility of government, business, civil society and citizens in addressing obesity?

Obesity is a growing health concern in many countries. The rate of obesity has more than doubled over the past twenty years in Australia and the United States, while it has tripled in the United Kingdom. More than 30% of the adult population in the United States is now considered to be obese. In Australia, Mexico and the United Kingdom, the rate has risen to more than 20%. In continental European countries obesity rates are lower, but have also increased substantially over the past decade.

Obesity is a known risk factor for diseases such as diabetes, hypertension, cardiovascular diseases, respiratory problems (such as asthma), musculoskeletal diseases (including arthritis), and even cognitive conditions, such as Alzheimer's disease. The economic and non-economic consequences of obesity are significant. In the United States, a recent study estimated that obesity is associated with higher average health cost increases per year compared with the cost related to smoking. In Canada, the total direct costs of obesity have been estimated to be over CAN$1.8 billion, or 2.4% of total health-care expenditure in 1997. And in the United Kingdom, obesity is estimated to result in 30,000 avoidable deaths per year.

Policies to prevent or treat obesity aim to address its root causes, including bad nutrition and lack of physical activity. Governments in OECD countries are at various stages in experimenting with a range of policies and programmes to try to achieve the objectives of promoting better nutrition and physical activity. But health systems are more focused on curing illnesses today than preventing illness and disability tomorrow.

In fact, just 5 cents out of every health care dollar is spent on initiatives designed to keep people healthy. Yet population health can improve greatly thanks to preventive measures like public awareness campaigns, regulation and taxation. Notable is the dramatic reduction in rates of smoking that has taken place in most OECD countries since the 1960s, leading to a decline in the incidence of lung cancer. Stepped-up attention to prevention strategies is highly desirable in light of the difficulty in treating obesity.

Combating Infectious Diseases:

Over 17 million people die each year from infectious diseases, many of which are classified as emerging or neglected. New forms of diseases are cropping up more often than in the past. Recent trends in how we live our lives, with increased travel, migration and concentration in urban areas, often side-by-side with animals, have accelerated the spread of new forms of infectious disease.

Micro-organisms have a natural propensity to change and adapt. As a result of this natural process, together with changes in society, new diseases are emerging at an unprecedented rate, with dramatic resurgence in some epidemic-prone diseases. Variants of micro-organisms that are resistant to the anti-microbials that form the front line of society's defences are developing.

The emergence of SARS is by no means an isolated event. Since the 1970s, at least 30 new infectious diseases have emerged for which no effective treatment exists. One of the most destructive diseases the modern world currently faces was virtually unknown 20 years ago, but today the HIV/AIDS epidemic has infected more than 40 million people world wide. HIV/AIDS, together with the other global "priority" diseases, tuberculosis and malaria, account for over 300 million illnesses and more than 5 million deaths each year. These diseases are immensely destructive in economic and social as well as in human terms. Yet these "big three" still account for less than a third of the estimated annual total of 17 million deaths caused by infectious diseases.

Advances in the life sciences - biotechnology, genomics and informatics can, if properly harnessed, contribute a great deal towards meeting this most important of humankind's battles with nature. But a large proportion of deaths are associated with so-called "neglected" or "emerging" diseases. Private and public investment in developing ways to treat such diseases is generally small and insufficient. In the field of pharmaceutical treatment, for example, only 1 % of the new chemical entities that were subsequently commercialised between 1975 and 1997 were designed specifically to treat tropical diseases.

These 17 million premature deaths and innumerable serious illnesses obviously affect economic growth, development and prosperity, as well as security and sustainability. If the global community is serious about achieving sustainable development and growth in the world economy, the rise in infectious diseases will need to be halted. The international community has come to recognise the urgency of this issue, and a strong consensus has been developing on the need to address inefficiencies in global health research for infectious diseases, the barriers to effective R&D and market failure.

In 2000, the G8 community at Okinawa stated the need to sustained action and coherent international co-operation to fully mobilise new and existing medical, technical and financial resources in the fight against infectious diseases. A number of public/private partnerships have been established, also at the international level. A number of potential products for treating emerging and neglected diseases are ready for late-stage development, but lack funding to bring them through late phase clinical trials. While many of these recent high-publicity ventures focus on the "big three" and several are making notable progress, there are far fewer initiatives on the emerging or neglected diseases that account for such large-scale human suffering.

OECD countries could do a great deal in this area. Official development assistance, co-operative research and development programmes, and strategies to overcome market failures all can play a role in turning back the real tide of infectious disease. But what we need most is a real international partnership, with OECD countries shouldering much of the responsibility for delivery of the most vital of the pillars of sustainability - good health for all. The tools for combating infectious diseases include: making public-private partnerships work to develop needed medicines and vaccines; harnessing the phenomenal advances in the life sciences and technology in order to prevent and treat disease; and finding new ways to bring benefits of intellectual property rights to a broader base of beneficiaries. OECD countries have a particular responsibility in addressing these problems since together they account for a high proportion of global research and development capacity and market power.

Health policy challenges were also addressed earlier at the IX Forum International de la gestion de la santé, held in Paris, November 20, 2003 and organised by Les Echos by Mme Berglind Ásgeirsdóttir, Deputy Secretary-General, OECD. Here are some highlights from her speech:

Improvements in medical technology
Advances in the capability of medicine to treat and prevent health conditions are widely agreed to be a major factor driving health cost growth. Recent developments in imaging, biotechnology, and pharmacology suggest that this trend is likely to continue. For instance, the number of magnetic resonance imaging (MRI) units which are used to diagnose a wide range of diseases has more than tripled on average across OECD countries during the 1990s, rising from 1.7 per million population in 1990 to 6.5 in 2000. While the number of MRI units has also increased in France, their number was lower in 2000 (2.6 per million population) than in most other OECD countries.

Population ageing
Population ageing is also expected to play an important role in driving future growth in health spending. Across OECD countries, the share of the population aged 80 and over now exceeds three percent and is growing in most OECD countries. It is not clear whether population ageing will itself place greater strains on the acute care system, as there is evidence that care costs are concentrated in the last two years of life.

However, even if acute care costs do not escalate, the growth in the absolute number of older people does mean that the number of people in need of assistance with daily living is likely to grow. Until now, most long-term care of the elderly has been provided by other family members. In most countries, elderly people have a strong preference for "ageing in place" and prefer to avoid institutionalisation as long as possible.

The tendency over recent decades has been to reduce the number of institutionalised beds, in favour of increasing support for people remaining in their own homes as long as possible. However, the demographic changes which have led to ageing also mean that the capacities of families to provide such care could decline in the future.

Overall, the OECD has projected recently that total health-care spending will increase by an average of nearly 2 percent of GDP over the period 2000 - 2050 as a direct result of population ageing.

Pressure on public budgets
More broadly, concerns about health cost growth reflect the pressure such growth places on public budgets. Given the predominance of publicly financed health insurance coverage or direct public financing of care in most OECD countries, the public sector accounts for the greatest part of health spending in all countries except Korea, Mexico, and the United States. And even in the United States, where the private sector plays an unusually large role in financing, public spending on health represents 6% of GDP, comparable to the OECD average percentage represented by public spending.

Second message: there has been a general trend towards improved access to care
A rising health spending to GDP ratio is not necessarily problematic from a policy perspective. Indeed, an emerging dilemma facing governments is judging the "appropriate" level of health spending. On the one hand, social welfare may well be improved by increased government spending, particularly if it translates into improvements in access to care, in the quality of care and in the resulting health outcomes.

Third message: there have been dramatic improvements in health outcomes but not enough attention is paid to preventive as opposed to curative actions
Partly as a result of improvements in access, combined with technological advances in health care, there have been dramatic gains in health status in all OECD countries in the past 40 years in the OECD area as a whole. For example, life expectancy at birth increased from 68.5 years in 1960 to 77.2 years in 2000. However, it is hard to say how much of this gain was due to better health care and how much was due to, say, rising standards of living and better diets. France had one of the longest expectations of life for women among OECD countries in 2000 (82.7 years) and had above average life expectancy for men (75.2 years). Japan had the highest life expectancy among OECD countries, with 81.2 years, followed by Switzerland, Sweden and Iceland with a life expectancy close to 80 years.

Fourth message: improvements in the quality of care have not always been linked to higher spending
Clinical outcomes, such as cancer survival rates and rates of disability among those with chronic conditions, serve to reflect more directly the effectiveness of care received, as compared with health status measures. International comparisons of outcomes for conditions such as ischaemic heart disease have uncovered significant differences in case mortality. Among European countries, France and Austria (equally) have the highest percentage of male patients alive 5 years after diagnosis of all cancers (57.9%).

However, the best outcomes have not always been found to be linked with greatest resource use or volume of services, suggesting that there may be opportunities in some countries to simultaneously reduce costs while maintaining or even improving quality and health outcomes.

Indeed, there have been reports from a growing number of countries of concern with the quality of care, indicating that services are overused, underused and delivered in a technically poor manner. For example, evidence has been found in the United States of failings to deliver recommended clinical care, even when it is cheap to do so, such as provision of aspirin to patients following a heart attack. Another example that is common in many countries, concerns unnecessary or repeated diagnostic tests and procedures that add to cost, often at little or no potential benefit to patients.

As a result, there has been a growing interest in some countries in developing indicators of outcomes in order to base treatment decisions on evidence and not customs as well as in holding providers to account beyond the traditional agenda of professional self regulation, for example by introducing external reviews of quality and informing consumers about quality to aid their choice of insurer or provider.

Fifth message: there is great scope for improving efficiency
Because of continued pressure for cost increases and some evidence that the same or better outcomes could be obtained at lower costs, OECD countries are striving to increase value for money in health systems. A number of efforts are being made in this area. Let me just give you a few examples of some the issues currently under discussion in member countries.

First, what is clear is that the productivity and responsibility of the health workforce is critical to efficiency in health care. And there is some evidence that medical practitioners' productivity is affected by types of payment methods. In ambulatory care, there is a growing interest in rewarding physicians for quality of care and outcomes. A new contract for general practitioners based on payment for quality has for instance been introduced in the UK.

Similarly, in hospitals there is now a widespread move across countries - including France - towards adopting prospective, case-related payments to hospitals based on diagnosis-related group (DRGs) rather than fee for service or simple global budgets in order to reward hospitals that better respond to demand without necessarily increasing costs.

Second, a major problem in the vast majority of OECD countries is that consumers and patients do not feel the effects of increasing prices because of minimal cost-sharing requirements. The poor and the sick, who are the highest users of health care services, are often exempted from any payments so as to facilitate their access to services. And even for the healthier, higher-income populations, price sensitivity is low given that private and complementary health insurance covers most out of pocket payments. Many countries are now reflecting on ways to increase consumers' sensitivity to incurred costs.

There are many other options being contemplated to improve efficiency, such as finding the optimal mix of skills among the medical workforce, i.e. the respective roles of doctors and nurses. As well, many countries are currently reflecting on the optimal distribution of acute and long-term care beds and on the continuum of care between ambulatory and hospital care. But let me finish by giving you one example where there is evidence of at least one dramatic improvement in efficiency. The Veterans Health Administration (VHA) is a large, tax funded public provider of health care in the US, which underwent a major transformation in the mid 1990s. There was a shift from hospital care to ambulatory care of patients and from treatment to prevention. The emphasis was on keeping people, especially those with chronic diseases, out of hospital. Under performance guidelines and targets, there was a sharp increase in effectiveness and quality. Satisfaction among patients increased significantly. All of this was achieved with a flat budget from 1995 to 1999. Expenditure per patient fell by 27%. A key instrument in achieving these efficiency improvements was the introduction of comprehensive electronic patient records. Similar reforms are now being taken up by private plans in the US. There may be lessons here for many health systems in other countries.

To conclude
Health systems differ widely in their design, in the inputs they employ and the outcomes they attain. Yet policy makers across the OECD have endorsed very similar performance objectives and virtually all countries are facing a common objective of improving the performance of their health systems. They are all grappling with the issues of how to assure sustainable financing of health care, maintain equitable access to services, attain better health outcomes, increase responsiveness to consumer expectations and improve value for money. In 2001, the OECD initiated the Health Project to address these challenges and to help member countries better understand the sources of these problems and their potential solutions. I believe that the work conducted under the auspices of the OECD Health Project is very valuable. By comparing health systems across countries, it tries to identify best and worst practices, it allows governments and other stakeholders to share information on what works and what does not depending on the circumstances, and it is contributing to the public debate. Results of this project will be presented to Health Ministers in spring next year in a report that will assess policy options and will point to avenues for improvement.

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