Role of General Health Insurance Company VZP in the Czech health insurance market today and tomorrow

1
Role of General Health Insurance Company (VZP) in
the Czech health insurance market today and
tomorrow
Pavel Horak, M.D., Ph.D., MBA, General Director
Prague September 24, 2007
2
Health Insurance System CRtoday and tomorrow

• Covers all persons with permanent residence in
  the Czech Republic and persons employees of an
  employer whose seat is located in the Czech
  Republic
• European health care and health care insurance
  market will become more and more interconnected
• Basic principles will not change
• Compulsory participation
• Solidarity
• Free choice of the healthcare provider (at least
  for certain products)

3
VZP CR is the biggest health insurance company in
the Czech Republic
Some indicators of VZP CR 2007
4
Unlike in the past, debt and deficits are not a
problem for VZP anymoreCurrently VZP is
financially stable
5
Contractual Healthcare Facilities

• Significant changes are expected to occur
• ( hospitals, ownership, contracting policies)
• Outpatient healthcare facilities
  33 750
• Inpatient healthcare facilities in total
  267
• Spas
  45
• Convalescent homes
  5
• Medical transport services
  531
• Rescue services
  173
• Pharmacies and medical aid dispensaries 2 367

6
ORGANIZATIONAL STRUCTURE OF VZP CZ

• Organizational structure is formed with the Head
  Office, regional branches (14) and workplaces
  (75)
• Head Office executes decisions of the Supervisory
  Board, it decides on activities of the insurance
  company, it is responsible for cooperation with
  state authorities, other bodies of the public
  administration, with corporate and natural
  persons, and it executes other activities that
  are connected to the public health insurance
• Tomorrow standard corporate governance will be
  introduced during transformation to state owned
  stock company

7
VZP Guiding Principles for the future
Population scale public insurance

• Consumer centric
• Provider friendly
• Evidence based
• Transparency

Change from the tax office to the insurance
company is the biggest goal for the future
8
VZP moves to

• Have common front end for all customer
  interactions and standard repeatable processes
  across locations
• Real time claims submission, real time
  eligibility and deductible status
• Support of e-health, electronic prescribing and
  chip EHIC
• Centralized IT architecture and processing,
  paperless transactions
• employ empowered motivated and well trained people

9
CHALLENGES

• Transformation from the tax office to the
  insurance company
• Insurance contracts with insured, selling
  multiple insurance products
• Possible integration with injury insurance, sick
  funds even with disability payment

10
Medical Challenges

• Ischemic Heart Disease, Smoking, HBP
• Tumors, Oncology diseases
• Diabetes and Obesity
• Demographics

11
Where to go - Care management

• Horizontally integrated disease management
• Trend management on broad population
• Promotion of certification and standardization of
  services, quality management

12
COST DRIVERS

• Ageing population
• Drive for quality and higher comfort of care,
  high expectations of population about delivery of
  state of the art medical care
• Care evolves away from treating acute episodes
  towards chronic and/or expensive conditions
• New expensive drugs incl. orphan drugs, genomics
  and biologicals to treat these conditions
• Technology improvements

13
VZP Goal to Manage Health Care Costs is to Engage

• Patients (responsibility, multiple choice
  products)
• Providers (price competition)
• Medical societies (EBM)
• Producers (SCA, PVA, PPC)
• Employers (shared responsibility)

14
Where to go

• Drive for quality
• Negotiate prices
• Make coverage decisions
• Adopt guidelines based on evidence and
  comparative effectiveness and linking it to Pay
  for Performance
• Patient safety and information
• Incentives to promote healthy behavior
• Electronic records (EMR, EHR, PHR)

15
Benefits Design to Manage Health Care Costs

• Deductibles and coinsurance
• Value based insurance
• Value based formulary
• Enablement of multiple product portfolios
• Integrating financial component into health care
  product

16
Thank You for Your Attention