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Private healthcare, adding value. Situation analysis 2018

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The eighth anniversary of the creation of the IDIS Foundation is approaching. It is also the eighth edition of this report entitled “Private healthcare, adding value”. This was precisely our most important founding principle, and is a fundamental goal: to affirm the value of privately owned medical services and private enterprise in healthcare for society as a whole.

PRESENTATION OF THE STUDY

FOR A LEGACY OF SUSTAINABILITY AND SOLVENCY IN HEALTHCARE

The eighth anniversary of the creation of the IDIS Foundation is approaching. It is also the eighth edition of this report entitled “Private healthcare, adding value”. This was precisely our most important founding principle, and is a fundamental goal: to affirm the value of privately owned medical services and private enterprise in healthcare for society as a whole.

The structure of this report, presenting key work and analysis, has not changed over the years, as it discusses fundamental aspects of what this sector is and what it means, not only for the country, but also for the National Health System (SNS): it represents a large portion of Spain’s productive sector in terms of GDP, while it frees up public healthcare resources, improves the public’s access to healthcare, provides advanced research and development through nextgeneration technology, seeks to continuously improve the quality of healthcare, creates jobs, and contributes to the training of health professionals as students and after graduation.

One aspect I would like to highlight in this brief introduction is how this report provides a cross-section of private healthcare in the different territories of Spain. We must take into account that as healthcare responsibilities are transferred to the different autonomous regions, we now have 17 health systems. This brings healthcare management closer to the public and enables to respond to the needs of local people, but at the same time, it can make it more difficult to ensure equity, cohesion, and access, among other aspects.

If individual autonomous regions assign different resources to the health of their citizens, this naturally creates differences which impact the principles of equal treatment, consistency, and access, first set out 32 years ago in the General Health Act. Alongside universality and public funding based on taxes, these are the fundamental principles on which our healthcare system is based.

If we look at access to the system, one of the aspects dealt with in this report is publicprivate partnership in its different models: collaboration, concessions, and mutual insurance for civil servants. Here, the figures are persistent, and the facts even more so: while waiting lists are getting longer in the public health system, we are seeing a decrease in the use of collaboration formulas in the different territories of Spain which could provide solutions to the problem, to say nothing of the concession model, with the politically-motivated controversy around Alzira Hospital and its revoked concession. Not to use the resources available in the system in an organised and synergistic way goes against the provision of the best patient care, and against the public interest in general.

We have good news on the subject of mutual insurance for government employees after a new agreement was signed this year confirming the benefits of this formula. This welcome effort by the government is a first step towards consolidating a model which is still somewhat precarious, despite its excellent results. This management method has similarities with the Dutch healthcare model, where there is a separation between funding, provision, and (obligatory) insurance, most of which is private. Incidentally, this model is the one scoring highest Europe-wide for efficiency, healthcare outcomes, ease of access, and perceived quality.

Examining the question of public access in more depth, and taking into account that the private healthcare sector has repeatedly shown itself to be willing to contribute to improving healthcare for the general public, there can be no doubt that the reversals seen in the collaboration and concession models are not for objective technical reasons, but due to the demagoguery which surrounds them, making them a focus of political confrontation when they should be a model of conciliation, given the virtues and figures arising from efficient management and with proven results based on a search for synergies and complementary factors.

The transparent data gathered in this report are a reason for pride for an organisation like this one that I lead, given that despite all the difficulties and the many obstacles others put in our way, the private healthcare provision and insurance sector continues growing day by day. This is achieved thanks to the effort and commitment of its excellent professionals, and its strong support for innovation, research and development, and quality in the broadest sense, even in difficult periods like the hardest years of the economic crisis.

We greet this year, as always, with optimism and resolve, knowing that the healthcare outcomes and the perception of our patients, their families, and the general public support us. The quality indicators of our centres, structures and professionals are clear and undeniable, as attested by the evidence: 9 out of 10 users would recommend using private healthcare; over 80% of Mutual Society members (the only citizens who can choose their healthcare model) opt for this private provision and insurance system, and no fewer than 8.2 million people (well above the percentage in neighbouring European countries) choose to pay for dual healthcare coverage.

Meanwhile, the latest perception survey grades the average level of satisfaction with the services received as good, and in terms of health outcomes, we are achieving excellent wait times for tests and reports. The average hospital stay is 3.38 days, the average waiting period for surgery is less than 29 days, waiting time for A&E is less than half an hour, and survival rates are as good or even better than those observed in the best-regarded public healthcare services. For example, the survival-to-discharge rates for acute myocardial infarction (at 94.4%), heart failure (90.6%), and ictus (86.7%).

A last detail, which says a lot about the importance of this private provision and insurance system, is that nearly 30% of all surgery (33.8% of neurosurgery and 28.4% of heart surgery is done in these departments and centres), over 23% of hospital discharges, admissions, and emergency care, and a large part of the robotic surgery, hybrid imaging techniques, and new forms of diagnosis such as liquid biopsy take place within the private healthcare sphere.

As I was saying, these figures and data are a source of satisfaction and pride for us, but they are not enough. Our obligation is to improve every day, providing the latest and most significant scientific breakthroughs for our patients, along with the experience of the most highly skilled and renowned professionals in their different specialist fields, all in structurally, functionally and operationally versatile and modern facilities.

Finally, our sector’s reputation is vitally important, and we are working hard to manage it in different ways. As well as those I have already described, I would like to mention three more: the importance of making the sector and its components more competitive; the need to internationalise our operations; and thoughtful and responsive communications management for the entire sector, using all available channels.

Only by improving our reputation through appropriate management, demonstrating the technical and human quality of our services every day, can we combat the absurd ideas that some people are determined to associate with this sector, despite its reach and its concentrated quality, expertise, and results. Our final goal must be to ensure a legacy of sustainability for the healthcare of future generations. This is our great responsibility and commitment.

Dr. Luis Mayero

President of the IDIS Foundation

THE CONTRIBUTION OF THE PRIVATE HEALTHCARE SECTOR

The private healthcare sector has considerable weight in our economic and social system, generating well-being, wealth, and jobs, and contributing to the development of Spain. It is also an essential strategic ally of the public health system, contributing significantly to its sustainability by freeing up resources and generating savings, while also improving the accessibility and quality of healthcare.

This report, as in previous years, shows several ways the private healthcare sector contributes value:

Represents a large proportion of Spain’s productive sector

Healthcare spending in Spain was 9.2% of GDP in 2015, a tenth higher than the previous year. This slight rise is thanks to an increase in spending on both public and private healthcare (Graph 1).

Compared to neighbouring countries, Spain’s 9.2% is above the OECD average (9.0%), although still lower than countries like Germany (11.2%), France (11.1%), and the Netherlands (10.7%) (Graph 2).

HEALTHCARE SPENDING IN SPAIN REPRESENTS 9.2% OF GDP

Spain is one of the countries spending the most on private healthcare as a proportion of total healthcare spending (29.0%), above the OECD average (27.1%) and leading EU countries such as France (21.1%) and Germany (15.5%) (Graph 3).

SPENDING ON PRIVATE HEALTHCARE MAKES UP 29% OF TOTAL HEALTHCARE SPENDING

Over time, spending on private healthcare has increased slightly from last year, to 28.562 billion euros, representing 2.7% of GDP (Graph 4). Meanwhile, public healthcare spending has grown significantly to 70.025 billion euros, breaking the downward trend which began in 2009 (Graph 5).

In the composition of private healthcare spending, out-of-pocket spending in 2015 represents 2.2% of GDP, private insurance represents 0.4%, and spending by non-profit institutions 0.03% (Graph 6).

The data for private insurance differ from those published by ICEA due to the methodology and adjustments used by the OECD to enable comparisons between different countries. If we consider the ICEA figure of 5.602 billion euros (healthcare and refunds) in 2015, private insurance would represent 0.52% of GDP.

Also, a percentage of public health spending is allocated to funding private provision through collaboration agreements, which is 11.6% in 2015 (Graph 7). In terms of GDP, it is estimated that these agreements make up 0.77%, of which 0.58% corresponds to autonomous regions, 0.15% to civil servant mutual insurance and the remaining 0.04% to the Social Security System (Graph 8).

ESTIMATED SPENDING ON PRIVATE HEALTHCARE REPRESENTS 3.5% OF GDP

Taking into account the above and adding spending for these agreements to private healthcare spending, we find that the estimated total expenditure on private healthcare provision represented 3.5% of GDP in 2015, an approximate expenditure of 36.226 billion euros (Graph 9).

Frees up public health resources

Private insurance

8.2 million people in Spain are insured, relieving the pressure on the public system and saving it money, as in the dual insurance model, citizens with private insurance do not consume or only partly consume public health resources.

THERE ARE 8.2 MILLION PEOPLE WITH MEDICAL INSURANCE IN SPAIN, HELPING THE PUBLIC SYSTEM RELIEVE PRESSURE AND SAVE MONEY

The savings generated for the National

Healthcare System by private healthcare varies depending on use of the public system. The estimated savings produced by a patient using only the private system is 1,203 euros, as they do not consume any public healthcare resources. This figure, which does not include spending on medication or the expenditure allocated to mutual insurance for civil servants, was estimated based on the initial budgets, adjusted by the average variance between budgeted and real expenditure in the 2014-2015 period (9.48%). In the case of a patient using a combination of healthcare, thus using both public and private healthcare, it is estimated that they save public healthcare 533 euros.

PRIVATE HEALTH INSURANCE IS ESTIMATED TO SAVE THE SNS UP TO 1,203 EUROS PER PATIENT PER YEAR

Therefore, taking into account the number of insured people in Spain in 2017 (8.2 million), the estimated total savings for the National Health System ranges from 4.369 to 9.860 billion euros (Figure 1).

According to the latest figures published by the Ministry of Health, Social Services and Equality, per capita spending on public healthcare was 1,406 euros in 2015. Based on the Ministry’s initial budget, the estimated per capita expenditure on public healthcare in 2017 was 1,500 euros (94 euros more than in 2014). Per capita expenditure on private healthcare increased from 531 euros in 2015 to 557 euros in 2017 (26 euros more), 423 of which correspond to out-of-pocket spending, and 134 to spending on insurance (Graph 10).

Geographically, the Basque Country, Navarre and Aragon were the autonomous regions with the highest healthcare spending per capita in 2015, at €2,287, €2,016 and €2,014 respectively. Andalusia, the Canary Islands, and Murcia, on the other hand, had the lowest spending on healthcare at €1,529, €1,717, and €1,764 respectively (Graph 11).

The updated figures for 2017 show that the Basque Country still spends the most per capita on healthcare, 2,357 euros, followed by Aragon and Asturias with 2,259 and 2,254 euros respectively. In contrast, the lowest per capita expenditure on healthcare was in Andalusia with 1,641, Castilla-La Mancha with 1,789, and the Canary Islands with 1,803 euros (Graph 12).

Madrid and the Basque Country are the regions with the highest per capita expenditure on private healthcare, with 713 euros and 690 euros respectively. At the opposite extreme are Castilla-La Mancha, Extremadura, and Murcia with 426, 431, and 453 euros respectively (Graph 13).

All the autonomous regions overspend their budgets for public healthcare. The regions with the greatest variance are Murcia (31%), La Rioja (23%), and Aragon (22%), while the Basque Country (2%), Navarre (3%), and the Canary Islands (4%) have the lowest variance (Table 1).

Meanwhile, the insurance industry continues to see significant growth, both in the number of insured and in the volume of premiums. Over 10 million people were insured in 2017, 5.1% more than the previous year. By type, 74.4% had medical insurance, 18.5% were public employees entitled to Mutual Society coverage, and the remaining 7.1% were covered for refunds of expenditure (Graph 14). The numbers of insured are increasing in most provinces, especially in Andalusia and Extremadura, where growth is above average (Figure 2).

THE INSURANCE SECTOR CONTINUES TO SEE SIGNIFICANT GROWTH

The volume of premiums in 2017 is estimated at 7.748 billion euros, a 4.1% increase from 2016 (Graph 15).

Despite the absence of a statistical correlation between private insurance and the public healthcare budget per capita, it can be observed, as in previous years, that certain autonomous regions with greater penetration of private insurance, such as Madrid and Catalonia, have a lower public healthcare budget per capita than the majority of regions in the country (Figure 3), despite having more large hospitals with highly complex services.

In market terms, the health insurance sector is highly concentrated, with the top 5 companies representing a 72% market share in volume of premiums, which increases to 83% if we look at the top 10 insurance companies (Graph 16).

Private sector activity

Private healthcare activity helps the public healthcare system achieve compliance with its goals, including reducing waiting lists. More specifically, in 2015, private hospitals performed 29% of surgical procedures (1.5 million), discharged 23% of patients (1.2 million), and provided 23% of emergency care (6.6 million) throughout Spain (Figure 4). The figures for this activity indicate growth in most areas of the private sector, especially in consultations (17.7%), A&E (23.3%), and surgery (29.1%) (Table 2).

PRIVATE HOSPITALS CARRIED OUT 29% OF SURGICAL PROCEDURES, COVERED 23% OF DISCHARGES AND ATTENDED TO 23% OF EMERGENCIES

It must be taken into account that the private sector activity figures indicated in this section do not include centres with substitution agreements, or which form part of a public use network, as the Ministry of Health, Social Services and Equality considers activity in such centres to be activity in public/SNS hospitals.

The average stay in private hospitals in 2016 was 5.84 days, very similar to 2015, when it was 5.86 days. In public hospitals, the average stay in 2016 was 7.80 days, which as for private hospitals is very similar to the 2015 figure of 7.82 days. However, according to the "Study on Health Outcome Indicators in Private Healthcare: RESA 2017”, published by the IDIS Foundation, the risk-adjusted length of stay of the private hospitals analysed was 3.38 days, a figure significantly lower than the 5.84 days published by the Ministry of Health, Social Services and Equality, as it mainly corresponds to acute care hospitals.

The care areas with the most hospital stays in the private sector are Specialist Medicine (2.1 million), Psychiatry (1.5 million), Long- Term Stays (1 million) and Specialist Surgery (0.9 million) (Table 3).

The most hospital discharges in the private sector are from Specialist Surgery with 381,036 discharges (28.3%), Specialist Medicine with 351,389 (17.5%), and Traumatology with 216,392 (34.6%) (Table 4).

In surgery, private healthcare performed 687,959 inpatient procedures (33%), 417,395 major outpatient procedures (26%), and 366,498 other outpatient surgeries (28%) in 2015 (Table 5).

By specialisation, private hospitals performed 35% of Orthopaedic Surgery and Traumatology procedures, 34% of Neurosurgery procedures, 31% of General and Digestive Surgery, and 31% of Angiology and Vascular Surgery procedures (Table 6).

Improves the public's access to healthcare

The private healthcare sector plays a fundamental role in enabling the public to access healthcare through its extensive care network, which includes hospitals, medical centres, imaging centres, clinical analysis laboratories, assisted reproduction centres, and private consultancies, where quality, responsive and diverse healthcare are provided.

PRIVATE HOSPITALS RESPOND TO THE NEEDS OF THE PUBLIC QUICKLY AND FLEXIBLY

The improved access provided by private healthcare is clearly seen in the results obtained in the last Healthcare Outcomes Study (RESA 2017) (Table 7). Private hospitals can be more agile in responding to the needs of the public, as evidenced by the following data:

Waiting periods for complementary tests are a less than or approximately one week for MRI (8.60 days) and CAT scans (6.04), and 10 days for mammograms (frequently scheduled as part of regular checkups), indicating a high level of access to diagnostic tests. The general pattern shows practically no waiting time for these tests in the vast majority of health centres.

  • Waiting time for additional test reports is under 4 days (2 in the case of mammograms).
  • Waiting periods for appointments in the most-used specialities are only just over two weeks, except in dermatology where they are 18.11 days.
  • The average times for medical attention in emergency care are less than 30 minutes, including triage which is 9:44 minutes.
  • The overall average waiting period for surgery, including elective procedures, is 28.2 days.
  • The time from diagnosis to treatment in oncology is under 15 days in the most frequent processes, such as breast, colon, or lung cancer.

Resources in the private hospital sector

Currently the private hospital sector has 451 hospitals, 57% of all hospitals in Spain, with 51,332 beds, 33% of total beds (Graph 17 and Graph 18).

THE PRIVATE HOSPITAL SECTOR OWNS 57% OF THE HOSPITALS AND 33% OF THE BEDS IN SPAIN

In relation to its neighbouring countries, Spain is at an intermediate level, both in the percentage of private hospitals over total hospitals, and in the percentage of private beds over total beds (Graph 19 and Graph 20). By type of healthcare, 63% of private hospitals (284) are general, medical-surgical and maternity-children's, while 37% (167) are extended-stay, psychiatric, geriatric and specialist hospitals (Graph 21).

If the healthcare purpose of public and private hospitals is analysed using the differentiation discussed above, it can be observed that the percentage of general, surgical-medical and maternity-children's private hospitals, among the total number of hospitals of this type stands at 52% while the percentage of number of beds is 25% (Graph 22).

As in previous years, Catalonia, Madrid and Andalusia are the regions with the most private hospitals and beds. Catalonia is the only autonomous region that has more private than public beds (+26%); it should be noted that private hospitals in Catalonia include those forming part of the Public Hospital Network (XHUP) (Table 8).

For this reason, in the geographical distribution of private hospital percentages by autonomous region, Catalonia has the greatest number of private hospitals, with 33% of the hospitals (147) and 38% of the existing private beds in Spain (19,258). Next is Madrid with 11% of private hospitals and 14% of private beds, and Andalusia, with 14% of private hospitals and 12% of the private beds (Figure 5).

Analysing the proportion of private hospitals and beds over the total number of hospitals and beds shows significant differences between regions. Catalonia, Navarre, and Galicia have the highest percentage of private hospitals over total hospitals with 69%, 64% and 63% respectively (Graph 23), while Catalonia, Navarre, and the Canary Islands have the highest percentage of private beds, totalling 56%, 39% and 34% respectively (Graph 24).

The private non-charitable hospital market reached 6.175 billion euros in 2016, 3.8% more than the previous year, with an annual growth rate of 3.3% over the 2012-2016 period. By demand segments, agreements with insurers represent 63% of the market, followed by public-private collaboration agreements (26%), strictly private patients (10%), and other items such as catering and parking, which represent 2% of turnover (Graph 25).

THE NON-CHARITABLE PRIVATE HOSPITAL MARKET EARNED 6.175 BILLION EUROS IN 2016

Composition of the private hospital sector

The private hospital sector is characterised by the presence of a number of operators which can be classified into three groups: hospital groups, hospitals belonging to health insurance companies, and independent hospitals.

The distribution of hospitals and beds among the main operators in the sector indicates that hospital groups have 46% of the hospitals and 61% of the private beds in our country. Meanwhile, insurance companies have 2% of private hospitals and 3% of beds, while independent hospitals and clinics represent 52% of hospitals and 36% of private beds (Graph 26).

In terms of market share, the 12 leading private hospital operators own 42% of private hospitals and 56% of private beds. Quirónsalud and the Orden de San Juan de Dios are the private hospital groups with the largest numbers of hospitals and beds. Specifically, Quirónsalud represents approximately 10% of private hospitals and 13% of beds, while La Orden de San Juan Dios has 7% of hospitals and 12% of beds (Graph 27).

THE PRIVATE HOSPITAL SECTOR CONTINUES ITS TREND TOWARDS CONCENTRATION IN LARGE HOSPITAL GROUPS

In geographical terms, most of the major operators in the sector are located in different autonomous regions, with Madrid, Andalusia, Catalonia and the Basque Country having the greatest presence of hospital groups (Figure 6).

In terms of turnover, the eight leading operators in the sector reached a turnover of 4.505 billion euros in 2016, representing 73% of the non-charitable private hospital market (Graph 28).

Recent movements in the sector

The private hospital sector is continuing the trend of recent years of merging into increasingly powerful hospital groups, leading to a more concentrated sector.

The most significant mergers and acquisitions of recent years include:

QUIRON SALUD: After joining the German Fresenius-Helios group in 2017, the company has made several acquisitions in its different business lines. A notable healthcare addition is the purchase of the Grupo Clínic Balear in Mallorca with one 30-bed hospital, a network of 9 healthcare centres, and a fleet of more than 20 ambulances. Three medical centres have also joined: QMS, offering most specialist medical areas and diagnostic tests, on Carrer Aribau, Barcelona; Centre Medic Rubí; and the MDS 360 centre in Madrid. Meanwhile, Medycsa and Servicio Balear de Prevención have joined its workplace risk prevention division, Quironprevención.

HM HOSPITALES: Continuing the expansion which it began in recent years, in early 2017 HM Hospitales strengthened its presence in the city of León after reaching an agreement with the Diocese for the Nuestra Señora de Regla Hospital to join the HM Hospitales network. The Group also increased its shareholding in the Clínica San Francisco to 75%, making it the leading private healthcare provider in the province. Other transactions in 2017 included the 100% acquisition of the Centro Médico La Moraleja in Alcobendas (Madrid) and the Centro Médico El Castro-Clínica Nuestra Señora del Perpetuo Socorro in Vigo. In 2018, HM Hospitales took its first steps into Barcelona, acquiring a significant percentage of the Delfos Hospital, a leading centre in Catalonia’s private healthcare.

VITHAS: With the merger of Nisa and its hospitals in early 2017, Vithas became the second largest operator in Spain and the best-positioned hospital group in the Mediterranean area.

CLÍNICA UNIVERSIDAD DE NAVARRA: It has opened a new hospital in Madrid, with 7 surgeries, 74 beds, an ICU and a Neonatal ICU, and 14 radiology rooms. The new hospital offers 46 specialist medical areas, as does its hospital in Pamplona, and employs 500 people.

IMED HOSPITALES: In 2017 it opened a new centre in Valencia with 186 in-patient rooms and 15 surgeries. Also, in January 2018, IMED Hospitales finalised the acquisition of 2 medical centres in Alcoy and Gandía, to be added in the next few months to the Group’s healthcare network, which already includes 2 hospitals in Elche and Benidorm, and 2 polyclinics in Teulada and Torrevieja.

SPANISH HEALTHCARE COMPANIES ATTRACT FOREIGN CAPITAL

Meanwhile, the good results of Spanish healthcare companies in recent years has encouraged the entry of large foreign firms. Notable transactions include the previously mentioned purchase of Quirónsalud by the German company Helios, the acquisition of the oncology services group IMOncology by the Australian group GenesisCare, and the merger of Geriatros and SARquavitae to create DomusVi, a health and social care company which in Spain manages 21,906 places in 153 centres, and internationally has 335 centres and 28,000 employees.

SPANISH COMPANIES ARE INTERNATIONALISING

At the same time as foreign capital is participating in Spanish healthcare companies, some national firms are also venturing into internationalisation. For example, the hospital group Hospiten, which as well as 7 hospitals in Spain now has 5 hospitals in Mexico, 2 in the Dominican Republic, and 1 in Jamaica, where it also has a specialist centre.

Ribera Salud is another example of internationalisation - it participated in the launch of the first two public-private partnership hospitals in Peru, provides computer systems in several hospitals in Chile, and has an alliance with the consortium led by Prestasalud in Colombia, which has acquired the country’s leading medical insurer, Cafesalud, with 24 hospitals, 40 healthcare centres, and 6 million insured. It has also acquired shares in the Pro Diagnostic Group (PDG), Slovakia’s leading radiology and nuclear medicine provider.

Before Helios acquired equity in Quirónsalud, the group had acquired 50% of the Clínica Ricardo Palma, the largest private hospital in Lima (Peru).

Among insurers, in 2014 Sanitas bought the Chilean insurance company Cruz Blanca, and now, a few years later, it plans to open its first hospital in Latin America, with 460 beds. Asisa, under the management of HLA, has a Reproductive Health Unit in Mexico, and participates in the management of the public hospital of Bata (Equatorial Guinea) and several multidisciplinary medical centres in Casablanca and Rabat (Morocco).

Other operators

Apart from hospitals, another type of facility which contributes significantly to increasing public access to healthcare, thus improving patient care and satisfaction, is the medical centre. These centres provide services which do not require inpatient care or hospitalisation.

Based on the data of the Registro General de Centros y Establecimientos Sanitarios (REGCESS), the register of the Ministry of Health, Social Services and Equality, there are a total of 10,853 medical centres in Spain.

THERE ARE A TOTAL OF 10,853 MEDICAL CENTRES IN SPAIN

By type of centre, 72.9% (7,915) are multipurpose, 20.0% (2,180) are diagnosis centres, 3.0% (322) are mental health centres, 1.8% (194) are assisted reproduction centres, 1.6% (171) are dialysis facilities, and the remaining 0.7% (71) provide major outpatient surgery (Graph 29).

Unlike earlier editions of this report, these figures now include other types of outpatient centres, and are based on a different primary source. The current source, as mentioned above, is the REGCESS register of the Ministry of Health, Social Services and Equality.

As well as medical centres, there are other private providers of outpatient care, including 14,007 doctors’ consultancies, 23,465 consultancies of other healthcare professionals such as chiropodists and physiotherapists, and 21,845 dental clinics.

Clinical analysis laboratories also play an important role in the private healthcare sector. Private laboratories had a turnover of 1.063 billion euros in 2016, an increase of 4.7% compared to 2015 and representing a market share of 39% of the Spanish market, one percentage point higher than the previous year.

Finally, the access to healthcare offered by the private healthcare sector is not limited to residents in Spain, but also reaches patients living in other countries. According to data from Spaincares, the commercial brand of the Spanish medical tourism cluster, which includes Spain’s most representative tourism and healthcare organisations, medical tourism reached a total economic volume of 321.9 million euros in 2014, a 25% increase on the previous year. By 2020, turnover from foreign patients is expected to reach 1 billion euros, benefiting Spain’s economy.

SPAIN RANKS SIXTH IN EUROPE AND EIGHTH WORLDWIDE AS A MEDICAL TOURISM DESTINATION

This inflow of funds is possible because our healthcare system enjoys considerable prestige and reputation in Spain and abroad, with an extensive network of hospitals and medical centres with next-generation technology and highly qualified personnel, making Spain one of the best-prepared countries for healthcare provision for patients from anywhere in the world.

Spain ranks sixth in Europe and eighth worldwide as a medical tourism destination. 63% of Spain’s foreign patients are from Germany, 19% from France, 5% from the UK, 5% from Italy, 4% from Austria, 3% from Sweden, and 1% from other countries.

Collaborates with the public system

The private healthcare sector is an important strategic ally of the public health system. Collaboration between both sectors is the ideal way to avoid redundancy and duplication, contributing to a sustainable, efficient healthcare system. Therefore, making full use of all resources, whatever their ownership, to achieve optimal healthcare for the population, must be the essential commitment of the public and private sectors.

The Healthcare White Paper of the Spanish Confederation of Employers' Organizations (CEOE) makes a strong case in defence of private healthcare and the different forms of collaboration. Spain has a long tradition of using some public-private partnership formulas, such as the agreements in place between regional healthcare services and private centres, mutual insurance for civil servants, and government concessions that include the management of healthcare services (Figure 7).

Agreements

Collaboration agreements between regional healthcare services and private centres in different areas of activity, including hospital care, diagnostic imaging, ambulance services, respiratory therapies and dialysis, etc. contribute significantly to achieving the fundamental values of the public system, such as equity, accessibility, reducing waiting lists and compliance with maximum response times.

As previously noted in the report, a significant percentage of public healthcare spending (11.6%) is allocated to collaboration agreements (Graph 7), reflecting their importance and impact.

11.6% OF PUBLIC HEALTHCARE SPENDING GOES TO COLLABORATION AGREEMENTS

Catalonia is the autonomous region that has allocated the most money to agreements, with 2.448 billion euros, representing 25.1% of its healthcare spending. Catalonia is followed by Madrid, Andalusia and the Region of Valencia with 987, 398 and 289 million euros (12.4%, 4.3%, and 4.5%) respectively (Table 9).

THE PRIVATE SECTOR IS AN IMPORTANT STRATEGIC ALLY OF THE PUBLIC HEALTH SYSTEM

Trends in the numbers of cooperation agreements over the past year vary depending on the autonomous region. The largest increases were in Aragon, 1.4 percentage points higher than the previous year, Navarre and Madrid, both with an increase of 0.7 percentage points. The largest decreases were in the Balearic Islands, down 1.7 percentage points from the previous year; the Region of Valencia, down 0.9 percentage points; and Andalusia, down 0.6 percentage points.

Approximately 43% of private hospitals (193) in Spain have some type of agreement with the public system in place. Also, 7% of private hospitals (30) form part of the Public Hospital Network in Catalonia (Graph 30).

By type of care, general hospitals have the most collaboration agreements, with a total of 122 hospitals with some type of agreement, followed by 19 geriatric and/or long-stay hospitals, 17 psychiatric hospitals, and 23 medical-surgical hospitals (Graph 31).

Given the percentage of hospitals with some kind of agreement over the total number of private hospitals, medical-surgical and general have the highest percentages of collaborating centres with 61% and 51% respectively (Graph 32).

In market terms, non-charitable private hospitals had a turnover of 1.578 billion euros under the heading of agreements in 2016, representing 26% of their turnover and 38 million euros more than in 2015 (Graph 33).

COLLABORATION AGREEMENTS REPRESENT 26% OF TURNOVER FOR PRIVATE HOSPITALS

Lastly, there is another significant type of collaboration agreement: the single agreement. This type of agreement establishes a link between a hospital and the public system, integrating its activity and objectives into the general planning of the National Healthcare System. In this case, the public healthcare system is linked to private hospitals by assigning a population to be cared for, establishing healthcare targets, or developing healthcare programmes. This type of agreement has a degree of permanence in time, allowing for management that is agile, flexible and adaptable to change.

Examples of single agreements are the

Fundación Jiménez Díaz in Madrid, Povisa in Vigo, Fundación Hospital de Jové in Asturias, La Orden de San Juan de Dios in different autonomous regions, the José Manuel Pascual group in Andalusia, and some private hospitals in Catalonia that form part of the Public Hospital Network (Figure 8).

Government mutual insurance

Government mutual insurance is the coverage mechanism of the Special Social Security Regime for civil servants and state employees, and consists of 3 large mutual insurance companies: Mutualidad General de Funcionarios Civiles del Estado (MUFACE), Mutualidad General Judicial (MUGEJU), and Instituto Social de las Fuerzas Armadas (ISFAS).

GOVERNMENT MUTUAL INSURANCE FOSTERS A BALANCE OF THE PUBLIC AND PRIVATE SYSTEMS

This collaboration model helps balance the public and private healthcare systems, reducing the pressure of too many patients in the system, making the public service more efficient, and guaranteeing the full range of services of the National Health System.

Under this model, the State maintains the functions of regulator, guarantor and subsidiser of healthcare provisions, transferring implementation to the National Healthcare System or free insurance entities. This lets mutual society members decide freely and voluntarily if they want to be cared for by the National Healthcare Service or by an insurance company with the same level of provision. This last option is selected by ~ 84% of civil servants, showing the level of user satisfaction, making it a model of high added value for beneficiaries.

84% OF CIVIL SERVANTS CHOOSE AN INSURANCE COMPANY FOR THEIR HEALTHCARE

Government mutual insurance covered approximately 1.9 million people in 2016, a decrease of 1.4% from the previous year, continuing a trend which began a few years ago. MUFACE is the mutual society with the largest number of beneficiaries (65%), followed by ISFAS (31%) and MUGEJU (4%) (Graph 34).

1.9 MILLION PEOPLE ARE COVERED BY GOVERNMENT MUTUAL INSURANCE

Alongside the decrease in members, for the first time in recent years the volume of premiums is expected to fall by 1.7% from 2016 to 1.517 billion euros. As well as the most members, MUFACE also has the highest volume of premiums (66% of the total) (Graph 35).

THE NEW AGREEMENT BETWEEN MUFACE AND INSURERS HAS IMPROVED SERVICES AND INCREASED THE PREMIUM

However, despite the decrease in member numbers and in volume of premiums over the last year, the new agreement between MUFACE and the insurers SegurCaixa Adeslas, Asisa and DKV for 2018-2019 will improve the provisions received by mutual society members and will increase the premium by 5.62% from the 2016- 2017 agreement.

Another change in the new agreement is that civil servants can change their insurance company twice a year, in January and June, instead of just once in January, as had been the case. This gives mutual insurance members more options and encourages competition among insurers.

With the new agreements for 2018-2019, the mutual societies now have collaboration agreements with a total of 8 insurers. In this case, SegurCaixa Adeslas and Asisa provide healthcare to the members of Spain’s three mutual societies. Also, for the first time, the Nueva Mutua Sanitaria del Servicio Médico will provide healthcare to MUGEJU members (Table 10).

THE GOVERNMENT MUTUAL INSURANCE MODEL INCREASES EFFICIENCY

In economic terms, mutual insurance for civil servants is a model that provides efficiency in the provision of a public service, since the per capita spending of the covered population is substantially lower than public healthcare spending per capita. The average MUFACE premium is estimated to be 828 euros per year and insured party in 2017, while public healthcare spending per capita that year was 1,203 euros (excluding spending on pharmaceuticals and mutual insurance), representing a saving of 375 euros per member for the government (Graph 36).

The claim rate for government mutual insurance was 99.0% in 2017, well above the insurance industry average of 73.4% for the same period (Graph 37).

In recent years, the claim rate for government mutual insurance has remained at levels ranging between 94.8% in 2016 and 99.3% in 2013. If the mutual society claim rate is compared to the average for the insurance sector over the same period, there is a difference ranging from 33.1% in 2016 to 34.9% in 201715 (Graph 38).

Government concessions including the management of healthcare services

The government concession model makes up for shortfalls in government funding, allowing the government to take on longterm spending to provide healthcare infrastructure, without necessarily increasing public debt. With this remuneration model, the financial burden can be spread over time, while it also increases the predictability of future public spending and favours greater spending control.

There are different types of government concessions depending on the level of services provided by the resource. Concession holders may provide services including: building and equipping the hospital; managing non-healthcare services such as cleaning, security, or catering; high-technology equipment; or managing healthcare services, which may include specialist care, primary care, psychiatric care, and care for chronic patients (Figure 9).

Government concessions which include healthcare services introduce the use of private management tools in public hospitals, while maintaining the same criteria and values that the public system is based on, in other words, free universal healthcare. In this case, the private companies bear the risk of creating and maintaining the infrastructure, meeting established objectives and ensuring the top quality free universal services required by governments, while also adapting to penalisations or reductions due to patients moving from one healthcare area to another, and to a set maximum percentage in the case of profit-making.

Various studies have demonstrated the feasibility and viability of the public-private partnership model from the care-giving and economic point of view. Researchers at the prestigious University of California, Berkeley (USA) analysed different international concession models drawing the clear conclusion that this management system adds efficiency and saves money and resources for the public healthcare system, reducing per capita expenditure by around 25%. Their report also shows that this model can reduce waiting lists from 39 to 20 days for first visits, and from 57 to 40 days for surgical procedures. At the same time, the percentage allocated to operating costs is notably lower, and average patient stays are also shorter in this model, helping to save money.

Another study, by Ribera Salud, based on data from the Healthcare Department of Valencia’s Consellería de Sanitat, also shows how this model contributes to the efficiency of the healthcare system. This study determines that the cost per patient in directly managed departments is 1,333 euros, while cost per patient in concession departments is 824 euros (Table 11).

GOVERNMENT CONCESSION SAVE MONEY AND RESOURCES FOR THE PUBLIC SYSTEM

The quality of healthcare and the efficiency of the concession model have led to its introduction in various regions, with a clearly positive user satisfaction rating for these hospitals, as good as or better than their traditionally managed equivalents.

9 hospitals are currently operating under this concession model in Spain. Geographically, government concessions including the management of healthcare services are located in the regions of Valencia and Madrid (Figure 10).

However, despite the success of concessions and the satisfaction of patients, they are now in a precarious position due to the decision of Valencia’s Consellería de Sanitat not to renew the concession in the Hospital de la Ribera, the first hospital to be launched under this collaboration model. This is a situation of concern and uncertainty for patients, professionals, and the healthcare system itself, in which the final decision may have consequences for the rest of the hospitals managed in this way.

Meanwhile, public-private partnership formulas are enabling the manufacturers of healthcare technology to become “technological partners”, developing a collaboration based on shared risk. These new strategies for equipping hospitals allow them to:

  • Update existing equipment.
  • Efficiently supply new centres gradually, as necessary.
  • Introduce elements of "availability" according to the needs of each device (incident response time, available technical service, replacement equipment, etc.).
  • Devise specific solutions to specific problems, through the process of dialogue with suppliers.
  • Sometimes, train professionals or incorporate personnel to cover the service

Provides advanced research and development through next-generation technology

Fosters progress in research

Private healthcare strongly supports research. This is the finding of the Best report, which is based on a strategic project driven by the pharmaceutical industry in which public and private stakeholders join to create a platform for excellence in clinical trials in Spain. The goal is to make Spain an attractive country for clinical research.

The data in this report refer to issue 24 of BDMetrics, corresponding to clinical trials with date of delivery to the relevant CEIC or AEMPS authorisation (according to RD) until 31 December 2017. BDMetrics content (Figure 11).

In recent years, given the highly competitive private healthcare market, the sector’s participation has increased, both in the number of clinical trials and in the participating centres.

PRIVATE CENTRES TAKE PART IN 1,327 CLINICAL TRIALS

Private centres represent 22% of the 180 total centres in the sample, a very similar figure to that shown in the previous publication. Private centres participated in 1,327 clinical trials, 43% of the total number of clinical trials and 21% more than in the previous publication.

Private centres recorded 2,125 participations, 9% of the total, and a 9% increase from the previous publication.

When taking part in clinical trials, private centres have a stronger presence in the early stages of research, when greater specialisation and complexity are required. Specifically, 37% of the trials where private centres participate, 513 trials, are in the early stages: phases Ia, Ib, and II. Oncology (39%), Cardiology (8%), Respiratory (7%), and Neurosciences (6%) are the main care areas of the trials in which private centres participate.

ONCOLOGY, CARDIOLOGY, RESPIRATORY, AND NEUROSCIENCES ARE THE MAIN AREAS OF PRIVATE CENTRES’ CLINICAL TRIALS

Private centres produce excellent results in the clinical research indicators considered, such as recruitment speed (1.4 in private centres vs. 1.1 in public centres) or recruitment rate (104.1% in private centres vs. 84.4% in public centres).

THE PRIVATE SECTOR HAS A VERY HIGH RECRUITMENT RATE

Incorporates the latest technology

Acquiring the latest technology in the private healthcare sector is an instrument for innovation, a key aspect for achieving sustainability, understood not just as innovation in pharmacology, biotech or technology, but also as innovation in management processes, encouraging efficiency, the co-responsibility of all agents, and the assessment of healthcare outcomes.

STATE-OF-THE-ART EQUIPMENT IS A KEY ADVANTAGE FOR THE PRIVATE HEALTHCARE SECTOR

Private healthcare works to continue advancing every day with the application of new breakthroughs in communication and information technologies and in associated services, enabling appropriate management of their introduction, development, maintenance, and gradual renewal.

Acquiring state-of-the-art equipment and the latest technology is a key aspect of the private healthcare sector, helping produce more efficient, better quality healthcare. Their support for sophisticated, innovative techniques enables them to perform increasingly complex activities and develop pioneering new techniques and procedures.

The use of technology in healthcare offers a range of benefits to patients, professionals, and the healthcare system in general, including:

  • Contributing to the prevention of diseases, reducing the need for future healthcare and, consequently, healthcare costs.
  • Improving diagnosis and helping in the early detection of diseases, allowing for more effective treatment.
  • Making treatments faster, more efficient, and more effective.
  • Supporting patient monitoring.
  • Enabling better management of clinical data. Favouring new more efficient, connected and global ways of working.

The private hospital sector owns 56% of Spain’s magnetic resonance imaging equipment, 48% of its PET, and 36% of its CAT scan technology (Graph 39).

THE PRIVATE HEALTHCARE SECTOR HAS 56% OF MRI, 48% OF PET, AND 36% OF CAT EQUIPMENT

Analysing the high-tech equipment of public and private healthcare from different regions shows that Madrid, Andalusia, Catalonia, and the Region of Valencia have the most high-tech equipment. Catalonia (59%), the Balearic Islands (57%), and Navarre (49%) are the regions with the largest percentage of equipment in private health centres (Graph 40).

In diagnoses, in 2015 the private sector carried out 1,144,791 MRI scans (39% of the total), 763,954 CAT scans (16%), 25,739 PET (21%) and 21,390 SPECT (14% of the total). It also handled 16% of haemodynamics patients and 13% of interventional radiology patients (Figure 12).

In 2015 the private healthcare sector performed a significant volume of complex healthcare procedures: 316,486 Orthopaedic Surgery and Traumatology procedures (35% of the total), 290,021 General and Digestive (31% of the total), 35,182 Angiology and Vascular (31%), 25,075 Neurosurgery (34%) and 13,854 Cardiac Surgery (28% of the total) (Figure 13).

It must be taken into account that the private sector activity figures indicated in this section do not include centres with substitution agreements, or which form part of a public use network, as the Ministry of Health, Social Services and Equality considers activity in such centres to be activity in public/SNS hospitals.

Seeks to continuously improve the quality of healthcare

The implementation of quality assurance policies in healthcare centres is one of the most significant trends of the last two decades. Studies carried out in Spain show that the private healthcare sector invests in the quality of healthcare provision. The 2017 RESA Report clearly shows positive trends in the quality indicators of the private healthcare sector, including:

  • 7-day readmission rate for surgery: 0.9%.
  • Survival-to-discharge rate for patients with acute coronary syndrome: 94.4%.
  • 30-day readmission rate for heart failure: 12.8%.
  • Survival-to-discharge rate for heart failure: 90.6%.
  • Survival-to-discharge rate for patients admitted with ictus: 86.7%.
  • Post-surgery septicaemia: 0.36 %.

All these results confirm that private healthcare has quality standards comparable to those of the best Spanish and international healthcare centres and systems (Table 12).

THE PRIVATE HEALTHCARE SECTOR INVESTS IN THE QUALITY OF HEALTHCARE PROVISION

In order to improve and demonstrate the quality of its centres, the private healthcare sector has different certifications accrediting their quality:

  • ISO Certification (International Organization for Standardization): one of the most widely accepted models used by private healthcare centres to accredit quality service to patients is ISO 9001 certification.
  • EFQM (European Foundation for Quality Management): this model is based on continuous improvement through assessment. The systematic and regular use of this model enables the establishment of improvement plans based on objective facts, and a consensus on goals and tools.
  • Joint Commission Accreditation: the benefits of this accreditation include improving public confidence in the organisation's concern for patient safety and the quality of care at all levels. 14 hospitals in Spain have this accreditation, 9 of which are private hospitals, 2 are privately managed public hospitals, and 3 are public hospitals.
  • OHSAS 18001 Certification: this is the internationally recognised assessment specification for occupational health and safety management systems. A large number of organisations have already implemented occupational health and safety management systems as part of their risk management strategy.
  • Quality certifications or seals of autonomous regions: granted by the regions themselves, these guarantee the quality of the institutions awarded them. These include the Madrid Excelente seal and the ACSA Certification (Andalusian Agency for Healthcare Quality).

The IDIS Foundation, as an organisation that focuses on quality, offers Spanish healthcare the QH Accreditation, designed to be a pioneering, innovative system which recognises Excellence in the Quality of Healthcare in public and private healthcare organisations which understand quality as a culture of improvement.

QH Accreditation was conceived to meet an existing need for a system integrating multiple quality components into a single unit of measurement. There had not previously been any universal and unanimously accepted model for recognising quality, as each of the existing ones referred to different dimensions of analysis and quantification.

QH Accreditation is a Synthetic Quality Indicator grouping the different attributes of existing quality systems to recognise excellence and a sustained effort for improvement, establishing identification through a progressive system from the system's access level (QH) to the maximum accredited quality level (QH + 3 stars). Therefore, the QH Accreditation:

  • Recognises institutions that make an effort to implement a progressive and continuous quality system over time.
  • Provides a unifying element for existing quality systems; its purpose is not to replace them.
  • Offers a voluntary assessment tool free of charge for healthcare organisations, irrespective of ownership, which are concerned about quality and continuous improvement.
  • Drives innovation and continuous improvement for healthcare organisations that aspire to excellence and work towards optimising all their procedures.
  • Recognises healthcare organisations which strive to implement a progressive, ongoing quality system, and who have obtained the necessary certification to provide the maximum guarantees on their processes.
  • Offers visibility to healthcare organisations for their results in quality.

Currently, 115 organisations hold the QH Accreditation: 42 at QH level, 40 at QH*, 29 at QH**, and 4 at QH*** (Table 13).

In geographical terms Madrid is the region with the most accredited organisations, with a total of 39, followed by Andalusia with 20 and the Canary Islands with 12 (Figure 14).

115 ORGANISATIONS ALREADY HAVE QH ACCREDITATION WHICH RECOGNISES EXCELLENCE IN HEALTHCARE QUALITY

As well as the QH Accreditation, the IDIS Foundation has worked since 2015 on developing a model of organisational interoperability as a primary tool for providing healthcare information anywhere, any time, and in any format. Patients are the main actors in this model, demanding greater legal flexibility without sacrificing security and data protection.

The proposed model can already be put into practice with the Mi e-Salud platform, a downloadable App for tablets, computers, and smartphones, an easy and accessible way for users to share information with doctors and healthcare professionals anywhere, whether using public or private services, with total security and according to their own preferences.

The work done and the high level of viability of the initiative earned Mi e-Salud the Special Computing and Health Award 2016 from the Sociedad Española de Informática de la Salud (SEIS).

THE IDIS FOUNDATION BACKS INNOVATIVE SOLUTIONS LIKE THE MI E-SALUD PLATFORM AND PRIVATE ELECTRONIC PRESCRIPTIONS

Another IDIS Foundation initiative linked to Mi e-Salud is the introduction of private electronic prescriptions, a technological solution which will have significant benefits for patients, doctors, institutions, and pharmaceutical companies, as it will gather all interactions, from the prescription to the final delivery, on a single digital medium, and enable healthcare professionals to monitor treatments exhaustively, improving healthcare for users.

This is a very important process for patients, as it makes procedures more flexible and safer, and helps them keep to their courses of treatment. It also reinforces the idea of patients being the centre of the system, with the healthcare model revolving around them, so that they share responsibility for managing their own health.

The IDIS Foundation sought the input of professional and patients’ associations in the design process, and it is expected to be ready later in 2018.

Creates jobs in Spanish society and helps train health professionals

The private healthcare sector is a job creator in Spain, employing 262,525 professionals in all sector activities, and offering new highquality jobs every year (Figure 15).

Of the 262,525 professionals who are part of the private healthcare sector, it is estimated that 65% (171,648) work outside of hospitals and 35% (90,877) work within the hospital setting.

By professional category, it is estimated that 22% of private healthcare sector professionals are doctors and 26% nurses, and the remaining 52% are other healthcare and non-healthcare professionals.

THE PRIVATE HEALTHCARE SECTOR, WITH 262,525 PROFESSIONALS, IS A JOB CREATOR

Geographically, Madrid, Catalonia, Andalusia and Valencia are the regions with the most professionals: 62% of the professionals in the private healthcare sector are in these 4 regions (Table 14 and Table 15).

The private healthcare sector is committed to training health professionals working within the sector in order to ensure excellenceoriented healthcare.

To support undergraduate training, the private healthcare sector has a total of 24 university hospitals in the autonomous regions of Madrid, Catalonia, Valencia, Andalusia and Navarre (Figure 16). Of the 24 university hospitals, 6 are hospitals using the government concession model for healthcare service management. Quirónsalud and HM Hospitales are the leading operators providing this type of training, with 7 and 6 hospitals respectively.

THE PRIVATE SECTOR HAS 24 UNIVERSITY HOSPITALS OFFERING 182 SPECIALIST TRAINING PLACES

The number of residency system places for specialist training in private healthcare centres are increasing every year (including places corresponding to privately managed public hospitals). Specifically, the Ministry of Health, Social Services and Equality called for applications for 182 places in 2018 (Graph 41).

Private centres and public centres with private management that have specialised healthcare training places through the residency system are located in 5 regions, with Madrid, Navarre and Catalonia offering the largest numbers of places. The centres offering the most places are the Fundación Jiménez Díaz and the Clínica Universidad de Navarra, with 53 and 41 respectively (Figure 17).

The specialisations with the greatest number of training places are Internal Medicine with 21 places, Orthopaedic Surgery and Traumatology with 19, Anaesthesiology with 13, and Ophthalmology and Obstetrics and Gynaecology with 10 places each (Table 16).

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