Attracting Health Insurance Buyers through Selective Contracting: Results of a Discrete-Choice Experiment among Users of Hospital Services in the Netherlands

Evelien Bergrath,Wim Groot,Milena Pavlova

doi:10.3390/risks2020146

Abstract

In 2006, the Netherlands commenced market based reforms in its health care system. The reforms included selective contracting of health care providers by health insurers. This paper focuses on how health insurers may increase their market share on the health insurance market through selective contracting of health care providers. Selective contracting is studied by eliciting the preferences of health care consumers for attributes of health care services that an insurer could negotiate on behalf of its clients with health care providers. Selective contracting may provide incentives for health care providers to deliver the quality that consumers need and demand. Selective contracting also enables health insurers to steer individual patients towards selected health care providers. We used a stated preference technique known as a discrete choice experiment to collect and analyze the data. Results indicate that consumers care about both costs and quality of care, with healthy consumers placing greater emphasis on costs and consumers with poorer health placing greater emphasis on quality of care. It is possible for an insurer to satisfy both of these criteria by selective contracting health care providers who consequently purchase health care that is both efficient and of good quality.

Highlights

As in many other European countries, the Dutch health care system is facing fundamental problems, such as rapidly rising health care costs and the need to reduce public health care expenditures to lower the deficit in public finances
The existing system of social health insurance for people with below average income and private health insurance for people with above average income was replaced by a universal health insurance with identical entitlements and contributions for all
The maximum waiting time guaranteed by the insurer is ranked as the most important attribute by 32% of the respondents, followed by the additional health insurance benefits (29.9%), the personal attention by health care providers (19.6%) and the insurance premium (11%), respectively

Summary

Introduction

As in many other European countries, the Dutch health care system is facing fundamental problems, such as rapidly rising health care costs and the need to reduce public health care expenditures to lower the deficit in public finances. The question is how to provide high quality health care at an affordable cost. 2006, people with below average income were covered through social insurance, while those with above average income had to buy private health insurance. The reforms replaced this two-track system with a single system of private insurance (provided by several insurers) with identical entitlements and contributions for every insured individual, coupled with the gradual introduction of managed care and selective contracting [5,6]. A key aspect of the managed competition reforms was the introduction of bargaining between insurers and providers over the price and quality of health care services [7,8,9,10]. Health insurers and health providers have been given more freedom in contracting, as the regulation that obliged health insurers to contract every registered health care provider (general practitioner, hospital, physiotherapist, etc.) has been abolished [15,16,17,18]

Results

Discussion

Conclusion