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03.05.2023
Social welfare and healthcare reform
The Ministry of Social Affairs and Health - Finland
1st October 2015
03.05.2023
Present social welfare and healthcare system in Finland• Universal services• Public, tax-based funding• Local authorities (municipalities)
responsible for organising – primary healthcare, – specialised medical care and – primary social welfare for their residents.
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Objectives of Finnish health policy
• to reduce premature deaths • more healthy years of life without loss of
functional capacity• to ensure an optimal quality of life for all • to reduce health inequalities between
population groups
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Current situation: social welfare and healthcare services in mainland Finland
Healthcare services
• Municipalities (301 in total) are responsible for arranging health care services
• Hospital districts (20 in total) are responsible for specialised medical care. A municipality has to be part of a hospital district to arrange specialised medical care.
• 5 specific catchment areas are responsible for arranging highly-specialised medical care
Social welfare services
• Municipalities are responsible for arranging social welfare services
• Municipalities are members in joint municipal authorities of special welfare districts (15+2 in total) that arrange services for people with developmental disabilities.
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Hospital districts and special catchment areas
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Population 1970 Population 2007
Inhabitant per square kilometer Inhabitants per square kilometer
Uninhabited area Uninhabited area
Demographic forecast of the elderlyby age group, Finland
Source: Statistics Finland
0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
65-74-year-olds75-84-year-olds85 and older
Number of inhabitants
Demographic dependency ratio forecast, Finland
1980
1983
1986
1989
1992
1995
1998
2001
2004
2007
2010
2013
2016
2019
2022
2025
2028
2031
2034
2037
2040
2043
2046
2049
2052
2055
2058
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
PensionersChildren
Statistics Finland, September 2012
The ratio of children (0-14) and pensioners (65+) to working age population
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Challenges • Ageing population• Increased need for services due to multi-
morbidity• Urbanisation
– accumulation of social and health problems: poverty, unemployment, poor health, poor mental health
– 10% of the population is using 80% of social and healthcare resources
• Increasing inequalities• Increased demand for services because people
have access to information via new technologies
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Earlier preparation of the reform• Earlier version of the reform: five social welfare
and health service regions (joint municipalities) would be responsible for planning services
• Bill for a new Social Welfare and Health Care Arrangements Act, submitted to Parliament on 4 December 2014
• Statement of the Constitutional Law Committee: the Bill was against constitutional local autonomy principles →the Bill was dismissed
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The Constitutional Law Committee’s opinionThere is an acute need, from the perspective of fundamental social rights, to
–increase the efficiency of the social and health services–improve their integration–strengthen the carrying capacity of the organisers.
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Social welfare and health care reform in the new Government Programme• Prime Minister Juha Sipilä’s Government
Programme, published in May 27th 2015
• A strategic programme
• Social welfare and healthcare reform one part of the structural reforms needed
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Main objectives of the social welfare and health care reform
• reduction of health inequality and
• cost-efficiency.
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Government’s objectives for cost reduction• Government wants to reduce public costs
by EUR 4 billion in the long term– Social welfare and healthcare reform´s share
EUR 3 billion• Measures before reform include
– Reduction of cost differences in specialised health care
– Improving efficiency in the organisations of regional specialised health care (hospital districts)
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Ways to achieve the targets of reform
The reform will be executed through
• extensive horisontal and vertical integration• strengthening the economical carrying
capacity of the areas.
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Solution for arranging the services• Social welfare and healthcare (SOTE) areas,
autonomous areas larger than a municipality – Areas will be managed by elected councils– Maximum 19 areas
• SOTE area responsible for arranging the social welfare and healthcare services in it’s area– division of work between hospitals will be reviewed– part of the specialiced care will be centralised to
special catchment areas
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Financing1. Options for financing services via
municipalities or state will be investigated• Constitution must be respected
2. Proceeding into monochannel funding
• Budgetary framework for social welfare and healthcare services to ensure effective governance
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Production of services• SOTE areas
– produce their services– can buy services from companies or
organisations– or increase the use of service vouchers
• Indicators for efficiency and quality of services will be created
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Timetable• 10/2015 Government’s decision on the number
of areas and the main structure of funding• 12/2015 Decisions on steering of digital
solutions, coordination of investments and the principles of election
• 4/2016 Circulation of the new bill for comments• 10/2016 The bill will be presented to the
Parliament• 7/2017 Enactment of the new legislation• 2017 - 2018 Elections• 1/2019 New SOTE areas start
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Multichannel funding of social and health services
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Multichannel funding system
• Funding collected from several sources and targeted through many channels
• Funders: state, municipalities, households, the Social Insurance Institution, employers, private insurance companies– tax revenue, statutory and voluntary insurance
payments, customer payments• The funding can be directed to public or
private production of services
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Challenges for multichannel funding• Incentives inappropriate from the perspective of the
funding system– Incentives transfer costs from one funder to
another → partial optimisation creates a damaging effect
• Independent decision-making in different funding channels
• Overlap• Differences between regions and population groups in
respect of availability of services• Effects on the availability of personnel
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Possible means for the discontinuation of multichannel funding
• Multichannel targeting of funding a bigger problem than multiple channels in the collection of funding
• The goal is to reduce the harm by– reducing the number of various channels
involved in decision making– reducing the number of parties responsible for
funding and decision making– reducing the overlap between the various
channels
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Thank You! Further information:
http://stm.fi/en/service-structures