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“A herculean task”

Interview with Jérôme Cosandey

Jérôme Cosandey’s study looks at how only cantons and health insurers benefit from cost-efficient treatment today. For this cost pressure to actually make a difference, however, patients must also reap some of the benefits.


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Jérôme Cosandey is the author of the Avenir Suisse study “Healthy Hospital Policies”.

Jérôme Cosandey is the author of the Avenir Suisse study “Healthy Hospital Policies”.

In your study you address the fact that today only cantons and health insurers benefit from cost-efficient treatment. However, for this cost pressure to actually prevail, patients should also reap some of the benefits. Allow me to ask you a provocative question: Have you ever compared prices before going to the hospital?

That’s a question I had never actually asked myself prior to this study. And that’s just it: As a patient, I only pay my excess or the deductible, with both of these amounts coming together quickly in the event of an inpatient stay. As a patient, I never notice if a procedure costs CHF 5,000 more or less. There’s no incentive for me to check prices before deciding on a hospital.

Insurance companies should be tasked with the job of bridging the information asymmetry between physician and patient. Promoting “cheap medicine” isn’t our goal, but if I knew where I could meet my needs and get the best value for the money, that would have a huge impact on my decision. The financial incentive we’re proposing is also aimed at promoting competition between hospitals: The hospital should offer at least the same level of quality as its competitor, and it should be motivated to do so with even greater cost efficiency.

When all is said and done, patients will still be allowed to choose their hospital based on their own individual criteria. Nobody should feel like they’re being forced to choose a “second-rate” hospital.

So that means you want to stimulate competition by offering patients, as customers, the same freedom to make their own decision as they have with other products?

Precisely. In fact, that idea of competition was already incorporated into the new hospital financing system. Yet three criteria have to be guaranteed in order for competition to work: market access for all competitors – although access is limited by hospital lists. Then the customer has to be able to choose freely between the various service providers – something that’s only possible to a certain extent outside a canton. Finally, there has to be transparency with respect to the offers – and even under the new hospital financing system, that is only partially the case.

As a patient, I would like to see a system where my health insurer explains the differences in quality to me. Not just because of any discounts I might get on my premium, but so I can get a second opinion on the services I’ll be receiving.

They say “You can’t put a price tag on good health.” But now you’re calling for competition and, by extension, economization in the healthcare system. How can that be compatible with quality?

You’re right: Health is a greater good. Because of that, it might seem strange at first to demand a business mindset here too. Nevertheless, it’s in everybody’s best interest that we demand the very highest quality for the money spent. Nobody benefits from inefficiencies, least of all a patient in a poorly organized hospital.

In your study you also talk about the need to have an external body to monitor quality.

That’s correct. We don’t want access to the market to be limited by cantonal or regional policy considerations. Instead, there should be quality standards that apply throughout Switzerland which tell us whether a hospital is allowed to participate in the market. Much like if somebody wants to run a restaurant in Zurich: If they meet the safety and hygiene requirements, they’re allowed to open a restaurant. And that’s a good thing too.

Even today, hospitals need to meet certain quality criteria in order to be added to hospital lists, one of which being minimum case numbers. Yet the cantonal differences are eye-opening. In most cases, it’s the cantonal hospital that meets this criterion: All public hospitals are on the lists. It stands to reason that the cantons don’t want to put their own hospitals at a disadvantage.

We want to take the politics out of hospital management: The cantons and the key players in the hospital industry will continue to have a say in how quality is measured. Yet the threshold values for a specific quality criterion need to have a scientific basis and shouldn’t be influenced by regional politics.

In your study, you also talk about public interest benefits that function as hidden subsidies for many public hospitals even though these funds are actually earmarked for teaching and research. Are you against this kind of support?

No, we fully support separate compensation for teaching and research. But these public interest benefits can also be used to cover services provided for reasons related to regional politics. This option isn’t defined in any detail. I can understand if these funds are there to guarantee emergency care in mountain areas. In areas where regular operation isn’t possible year-round, unlike in major cities, it’s nearly impossible to finance a hospital purely through case-based lump sums. The public interest benefits are intended as a means of offsetting those disparities.

It’s astounding, however, that the Canton of Geneva, for instance, pays public interest benefits of CHF 460 million every year with only about one third of that amount going into research and teaching. I don’t think an urban area like Geneva has any need for extra support to maintain its structures. An adequate level of healthcare would surely be available, even without subsidies.

If a canton wants to safeguard its basic healthcare services using public interest benefits, it should also employ a tender process. That process establishes a local market price for the hospital treatment and prevents any distortion of competition.

Do you think Switzerland is ready for your plan?

We’re fully aware of the fact that we’re trying to tackle an extremely complex problem here. Healthcare is always a very emotional topic. Take last year’s vote in the Canton of Neuchâtel for example: Some people voiced their opinion that a city like La Chaux-de-Fonds was entitled to its own hospital. It wasn’t about quality or necessity. It was all about emotions. And those have an impact on politics.

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