A) Structure and style of the course

The course is structured into three main parts:

• First part (lectures 2–4): Insurance
• Second part (lectures 5–6): Financing of health care providers
• Third part (lectures 7–10): Selected topics (performance measurements, productivity, equity, international comparisons, etc.)

Lectures are important and cover most readings, though not everything. The instructor will pose questions after almost every lecture, focusing on the definition of terms/concepts and details of specific systems. Students are expected to write notes or short answers to these questions and to form colloquium groups.

B) Fundamentals of health care systems

Core actors in health care systems include citizens/patients, insurance entities (funders/purchasers such as sickness funds and central/regional state bodies), and providers (Hospitals, Primary care, long-term care institutions, home care).

Citizens vs Patients; Insurance structure

Conceptually, citizens are insured individuals who gain access to care via the system, while patients are the recipients of care. Insurance serves as the funder and purchaser, budgeting and paying for services. Primary and secondary care are linked through referrals.

Funding of the system (insurance)

Funding has two primary dimensions:

• Mandatory vs voluntary insurance
• Premium-based vs tax-based systems

Premiums are payments for specific services, whereas taxes are parts of general taxes, sometimes supplemented by special taxes.

Mandatory, universal vs Voluntary systems

System examples by region:

• Central Europe (Austria, Germany, the Netherlands, …): Mandatory, universal, often premium-based.
• USA, some Asian and African countries: Voluntary or mixed systems; taxes are less central to coverage.
• Scandinavia, UK (e.g., USA - Medicare), Southern Europe: Tax-based systems.

Mandatory insurance; Social insurance vs tax-based systems

Social insurance (e.g., Netherlands, Germany, Austria, Switzerland):

• Employees and their families are members in sickness funds.
• Premiums are income-related and collected separately from taxes.
• Characterized by increasing competition among funds.
• Issues include selection problems and the need for risk-adjustment mechanisms.

Tax-based systems:

• Funded via general/national/state taxes.
• Feature income-related, progressive taxation.
• Typically have no explicit selection problems at the insurance level, but may face efficiency problems.

Other elements of financing

Other financing elements include:

• Out-of-pocket payments: These increased during the 1980s and 1990s, with their effects on equity and efficiency widely discussed.
• Supplementary health insurance: This reflects higher co-payments or addresses potential waiting times (rationing).

Provider payment systems – Integrated vs contract-based systems

• Integrated systems: The insurance company/tax collector and provider are the same legal unit.
• Contract-based systems: The insurance company/tax collector and providers are different legal units.

These types of financing systems provide the context for how payments flow from payer to provider.

Cost compensation vs prospective payment systems

• Cost compensation: Reimbursement of actual costs.
• Prospective payment systems: Reimbursement of expected (average) costs.
• Activity-based financing: Reimbursement dependent upon activity (treated patients).
• Fixed payments: An indirect relationship between activity level and reimbursement.
• Summary of concepts:
  • ${ ext{Cost compensation}} <br>\rightarrow ext{reimburse actual costs}$
  • ${ ext{Prospective payment}} <br>\rightarrow ext{reimburse expected costs}$
  • ${ ext{Activity-based financing}} <br>\rightarrow ext{payments depend on activity level}$
  • ${ ext{Fixed payments}} <br>\rightarrow ext{flat or indirect relationship to activity}$

C) Types of care

Definitions and dimensions of care include:

• Primary, secondary, and tertiary care, with secondary and tertiary care defined as specialist care.
• Somatic care vs psychiatric care.
• Acute care vs elective care.

Health system hierarchy

Health system levels include:

• Primary care
• Specialist care
• Local, general, and university hospitals

Health expenditures. Key figures (Statistics Norway)

The dataset covers 2016–2022 with the following indicators (values shown in NOK and percentages):

• Current health expenditure (NOK million): $ext{2016}=328134,\ ext{2017}=339948,\ ext{2018}=356241,\ ext{2019}=375450,\ ext{2020}=395456,\ ext{2021}=424360,\ ext{2022}=453401$
• Current health expenditure per capita (NOK): $ext{2016}=62667,\ ext{2017}=64421,\ ext{2018}=67065,\ ext{2019}=70205,\ ext{2020}=73512,\ ext{2021}=78464,\ ext{2022}=83084$
• Expenditure on health at constant NOK in 2015 per capita: $ext{2016}=61176,\ ext{2017}=61231,\ ext{2018}=61282,\ ext{2019}=62013,\ ext{2020}=60448,\ ext{2021}=62106,\ ext{2022}=62550$
• Percentage change in volume from the previous year: ext{2016}=0.1 ext{\%, 2017}=0.1 ext{\%, 2018}=1.2 ext{\%, 2019}=-2.5 ext{\%, 2020}=2.7 ext{\%, 2021}=0.7 ext{\%, 2022}=0.7 ext{?}}
• Current health expenditure financed by public sources (NOK million): $280159, 289366, 305311, 321825, 339961, 364531, 388466$
• Current health expenditure financed by private sources (NOK million): $47975, 50582, 50930, 53626, 55495, 59830, 64935$
• Share of health expenditure financed by public sources (%): $85.4, 85.1, 85.7, 85.7, 86.0, 85.9, 85.7$
• Current health expenditure as a percentage of GDP: $10.5, 10.2, 10.0, 10.4, 11.4, 10.1, 8.1$
• Current health expenditure as a percentage of GDP (Mainland Norway): $12.2, 12.2, 12.2, 12.2, 12.9, 12.9, 12.7$

Notes on interpretation:

• Public funding share is high and relatively stable around mid-80s percent across the period.
• Per capita expenditure in NOK shows growth over time, with a notable step-up in later years consistent with inflation and increased total health spending.
• GDP share fluctuates, dipping to around 8.1% in 2022 for overall health expenditure and remaining higher on Mainland Norway due to population and accounting differences.

D) Pathways for patients and information problems

Pathways for patient groups

Common conditions mentioned as illustrative examples for patient pathways include:

• Stroke patients
• Hip fracture patients
• Patients in need of hip prosthesis
• Dementia

Information problems

Basic concepts related to information in health care systems:

• Perfect information: Actors know their position in time and space, observe actions of others, and there are no simultaneous moves. If these conditions are not met, information is imperfect.
• Certain information: An actor knows the full effects of an action. If not, information is uncertain.

Categories of information problems:

• Symmetric information: Information is equally divided among actors; no one has more information than another.
• Asymmetric information: One actor has private information.
• Incomplete information: There is an ex ante lack of information. If not incomplete, information is complete.

E) Formalities

Assessment and grading for the course are based on a written exam, with grades awarded on a descending scale using alphabetic grades from A to E for passes and F for fail. The examination is a written type; ChatGPT is not available for use. The exam is scheduled for $ext{October 17 at } 9{:}00 ext{ AM}$ and will last for $4$ hours, taking place at Silurveien 2, Sal 3B.