In many countries, health services have traditionally been run and funded by the state. But in recent decades, several countries have undertaken major health reforms, inspired by more market logic.
The main argument for this trend is that increased competition will provide better and more efficient health services. However, recent research findings indicate that people still prefer health services to be primarily regulated and funded by the state.
We have found that Europeans are generally the most satisfied in countries where the public sector is in charge of most of the healthcare system.”
Pål Erling Martinussen, professor in the department of sociology and political science at NTNU (the Norwegian University of Science and Technology)
Martinussen collaborated with Håvard Thorsen Rydland of the Norwegian Research Center (NORCE) to study health care in 21 European countries. The researchers examined the link between the degree of market adaptation of the health care system and the degree of patient satisfaction.
More freedom of choice, but less satisfaction
Health reforms aim to strengthen patients’ rights and introduce greater freedom of choice and competition. In addition, various financial incentives in the healthcare industry have opened up to more profit-based and private payment-based offerings.
“In short, it didn’t result in more satisfied patients,” Martinussen says.
Few researchers have so far studied the effect that all reforms have had on health services. And even fewer have looked at people’s satisfaction with services afterwards.
“In fact, no one used people’s satisfaction as a measure of the success of the changes,” Martinussen said.
The researchers examined the degree of privatization of health care in different countries by examining the proportion of public financing of health services, the proportion of private hospital beds and the degree of public coverage. The methods allowed researchers to see results over both short and long periods of time.
How Norway did
Norway introduced effort-driven funding in 1997, whereby hospitals receive a portion of their revenue based on the number of patients they treat. With the hospital reform of 2002, hospitals were organized into companies. Here, the philosophy is that the public sector orders services, and providers can also be private.
“The key elements of the reform are greater independence of hospitals, more centralized state power, greater use of contracts as a form of government, professionals instead of joint councils, greater separation between the politics of health and service production and greater freedom of choice for patients,” says Martinussen.
These changes were part of the wave of market-oriented reforms that have swamped the public sector in many countries under the collective term “new public management” in recent years.
Competition between suppliers also has advantages
“Clearly there are benefits to competition in a public system as well. Private players have relieved some of the pressure on the public health service,” Martinussen says.
The researchers point out that the reason it works so well in Norway and the other Nordic countries, for example, is that only the providers are private. Funding and regulation remain public.
“We actually found support for this, in that people in countries with a higher share of private providers are more satisfied. So it seems people don’t find it critical who provides health services, as long as ‘They are run and funded by the state,’ says Martinussen.