The Danish government is planning to extend the reshaping of the national health system, integrating more services into larger and fewer clinics and hospitals and tackling health inequalities. However, GPs are critical of the plans that they say are just another cost-containment measure that will impact on the quality of care.
The association of local health authorities, Danske Regioner, supported by the national government, claims that GPs have too much flexibility on the services provided, location of clinics and their availability to patients. The Health Minister, Astrid Krag, has announced a law that would force doctors to accept the new working conditions to standardise services. In response, the doctors’ union has called for GPs to walk away from contracts with regional health authorities, with many threatening to strike, set up private clinics or work in Sweden if the reforms come to fruition.
The Danish healthcare system provides universal coverage to all residents that is largely free at the point of use. A wide range of health services are funded by taxation and patient co-payments, with supplementary private insurance. Compared to other Scandinavian countries, Denmark has a high rate of voluntary private health insurance that pays for most drugs, as well as dental treatments.
The National Healthcare Quality Programme (DDKM) sets standards for healthcare providers. Although patient choice is enshrined in law, care pathways particularly for cancer and heart disease were also created to ensure consistent treatment nationwide and reduce health inequalities.
Radical reforms
The healthcare system was fairly decentralised in Denmark, but since 2007 decision-making powers and management roles shifted from counties to five regions, separate taxes were also introduced to finance the health needs of the Danish population.
Commenting in 2010, the Scandinavian Journal of Public Health said: ‘This reform has been labelled the most radical reform of the political administrative system since the first democratic constitution in 1849. Local government reform is the latest step in a process of reforming the welfare state and the health sector.’
Subsequent reforms have increased central regulations and have further merged local services in primary and secondary care.
Most hospitals are owned and operated by the regions under a single payer system, Amgros, whose aim is: ‘to ensure that the public hospitals in Denmark always have the necessary pharmaceuticals available – and are always purchased at the lowest possible price’.
The Danish government has also been very keen to promote the use of technology to improve health outcomes with e-health and telemedicine projects in areas such as pregnancy, diabetes, and inflammatory bowel disease. The HealthShare-based initiative (a software system created by US-based InterSystems) enables the sharing of patient information between healthcare providers and government agencies countrywide, while the implementation of the National Patient Index (NPI) enhances clinical safety, improves search capabilities and provides a shortcut to securely accessing patient data.
GPs are critical of plans they say are just another cost-containment measure
Another feature distinguishes the healthcare landscape in Denmark: health indicators show that Denmark lags behind other Nordic countries due to risk factors such as alcohol intake, smoking and obesity. Thus, the top three causes of death in Denmark are coronary heart disease, stroke and lung cancer, according to 2010 Word Health Organization (WHO) data.
A general action plan to increase the general health of the population and tackle health disparities set up in 2011 included: higher taxes on tobacco and unhealthy food; targeted interventions to promote smoking cessation; prohibition of the sale of strong alcohol to young people; establishing anti-alcohol policies in all educational institutions.
The so-called ‘fat tax’ – a tariff on foods with high saturated fats – was later abolished as it had an impact on the economy. The Danish Medical Association (DADL), however, supported the move and criticised the government for giving in to the interests of food producers and retailers, as opposed to defending public health. Others added that one year was not long enough to assess the effectiveness of the tax on healthcare and that early data showed sales of fatty foods decreased substantially.
Pharma market recovers
The Organisation for Economic Co-operation and Development (OECD) says Denmark spent 11.1 per cent of GDP in health in 2010 and it spends only 7.7 per cent of its healthcare budget on outpatient pharmaceuticals (0.4 per cent of GDP). This accounts for the lowest expenditure and consumption of pharmaceuticals in Europe, although it is rising steadily. Cost-containment has been a priority with the official promotion of generics and through parallel imports.
The main players affecting the pharma markets are the Ministry of Health and its Danish Medicines and Health Authority (merged DADL and Danish National Board of Health). In Denmark there is no price control system for pharmaceuticals, but it is not as free as it seems. Since the middle of the 1990s a number of different arrangements have in fact put restrictions on prices. There has been a recent agreement in place between the Danish Association of the Pharmaceutical Industry (Lif) and the Danish Ministry of Health on introducing a cap on medicine prices. The current three-year agreement is an extension of previous price-caps and the deal on hospital pharmaceuticals has been extended to 2015.
The healthcare market is now showing signs of recovery following the global financial crisis
Pharmacists are required to do generic substitution and the generics market is one of the largest in Europe (57 per cent of prescriptions and 23 per cent in volume in 2009, according to the DADL). Reimbursement levels are set by the Reimbursement Committee of the Danish Medicines Agency (DKMA) and carried out by the five regions based on therapeutic benefits and added value but without consideration for alternatives. Patient co-payments can be considerable and the VAT rate at 25 per cent is the highest in Europe.
Market access depends on the licensing committee, which advises the DADL on cases concerning applications for market authorisations for pharmaceuticals and clinical testing of pharmaceuticals.
There is a positive list and reimbursement rates both for prescription and over-the-counter medicines depend on the patient’s accumulated pharmaceutical expenses during 12 months. The higher the expenses, the higher the reimbursement rate. For expenses below 900 Danish krone (€120) the reimbursement rate is 0 per cent. At expenses between 900 Danish krone and 1,470 Danish krone (€197) the reimbursement rate is 50 per cent. Between 1,470 Danish krone and 3,180 Danish krone (€426) the rate is 75 per cent and above 3,180 Danish krone the reimbursement rate is 85 per cent. If the patient’s payment exceeds 3,710 Danish krone (€497), the patient can apply for 100 per cent reimbursement for the rest of the year.
The reimbursement price is calculated according to the least expensive generic product, while in addition those under 18 qualify for lower co-payments.
The Danish healthcare market is now showing signs of recovery following the devastating effects of the global financial crisis of 2008, and the country’s pharmaceutical sector is expected to grow by an average of 6.9 per cent a year to reach $7.3bn by 2020, up from $4bn in 2011, says a recent report by GlobalData. The growth of the elderly population, a stronger focus on preventative care and investment in innovative products will boost the Danish pharma market, it suggests.
