Strategic alliances in health care

As of 2006, the Dutch health care system has transformed significantly with the introduction of market forces and competition among health insurers and health care providers. The term regulated competition was used to indicate that all actors involved in this competitive system are operating under a regulatory framework set out by the government to protect the public goals of affordability, accessibility and quality of care. Despite significant improvements in the preconditions necessary for this model to work, the full potential of regulated competition to increase efficiency and improve health care delivery has yet to be achieved. The current system is still characterized by fragmented and uncoordinated health care delivery, caused by the way health care is organized and financed. Major contributors to the rise in health care costs and the lack of coordinated health care delivery are the misaligned (financial) incentives embedded in the system. Other factors, such as the financial and organizational separation between primary and secondary care in the Netherlands, impedes collaboration between different health care providers and prevents the emergence of new initiatives that could improve the quality of care. Here, it is argued that integration of financing and delivery of care will greatly improve efficiency in Dutch health care. Organizations that have fully integrated financing and delivery of care are known as integrated delivery systems (IDS), and they include both a delivery system (physicians, hospitals, other clinicians, clinics, etc.) and an insurance function (benefit plans, financing arrangements) under one roof. They have been described as a network of organizations that provides or arranges to provide a coordinated continuum of services to a defined population and is willing to be held clinically and financially accountable for the outcomes and health of the population served. Advantages of such an organization include aligned interests between providers, payers and patients, financial and clinical accountability, ability to coordinate health care delivery across the entire spectrum, use of information technology, and matching resources with the needs of the population served. In this thesis, two options are proposed on how to move towards IDSs in the Netherlands, given the current organization and financing of the health care system. Firstly, hospitals could forge strategic alliances with insurers by taking over their contractual obligation to provide, or to reimburse, health care to their subscribers. Secondly, care groups could be given the financial and clinical responsibility to make sure their patients receive adequate health care. Both modalities resemble many of the characteristics that make up an IDS, such as per capita prepayment, aligned interests among payers and providers, increased financial and clinical accountability, and collaboration and coordination between primary- and secondary care providers. As such, these two approaches hold great potential to improve efficiency of the Dutch health care system while preserving the public goals of affordability, accessibility and quality of care.