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SWEDEN’S HEALTH CARE SYSTEM

An Analysis Of A World-Class Health System &

What Canada Can Learn From It

Team Members:

For Professor Linying Dong Laura Barons - #002087633

Health Sciences 472A: Meghan Burchat - #001839653

Health Management Sarah Gauthier - #002803257

Final Group Project Leena Kamat - #000619320

Due Date: December 3, 2001 Susan Varughese - #002343846

TABLE OF CONTENTS

Section / Pages
Executive Summary / 1
Sweden’s Health Care System / 1 – 7
Evolution of Sweden’s Health Care System / 1 – 3
The Current Swedish Health Care System / 3 – 4
Funding and Financing Health / 4 – 5
Current Problems and Solutions / 5 – 7
An Analysis of Sweden’s Health Care System / 7 – 9
Advantages to Sweden’s System / 7 – 8
Disadvantages to Sweden’s System / 8 – 9
A Comparative Analysis of Canada’s Health Care System With Sweden’s Health Care System / 9 – 13
Evolution of Canada’s Health Care System / 9
The Current Canadian Health Care System / 10 – 11
Funding & Financing Health / 11 – 12
Current Problems & Solutions / 12 – 13
Learning From the Swedish System / 13 – 18
The Introduction of Private Health Care / 14 – 15
Total Quality Management / 15 – 17
Managing elderly care (policy for the elderly) / 17 – 18
Conclusion / 18
Works Cited / 19 – 20
Appendices / 21 – 22

EXECUTIVE SUMMARY

The Swedish health care system is among the best in the world. The World Health Report 2000, ranked Sweden as having the 4th best health attainment overall and the 23rd best health care system (World Health Organization). Part of its success can be attributed to the nation’s historical approach to health. As early as the eighteenth century, it was nationally recognized that health played an important role in the wealth of the nation. By the nineteenth century, the Swedish population acknowledged the benefits that could be obtained if the state assumed a larger role in public health. The state took on the challenge, and slowly began laying down the foundation for one of the most recognizable health care systems in the world. Currently, all three levels of government (i.e. national, county, and municipal) play integral roles in the execution of this publicly funded system. Decentralization of health care services has been one of the key factors to its success. However, in the years to come, this system will be tested for its strength in adversity. With an aging and more inquisitive population, questions arise whether the system can maintain its public funds and deliver an informative service. Canada, which has a comparable health care system, faces many of the same challenges the Swedish system has encountered. A reflection on Sweden’s approach to their current challenges may prove useful for the Canadian system. Privatization, Total Quality Management and Sweden’s policy for elderly care are three management practices deserving a scrutinizing eye from the Canadian government. Overall, Sweden’s philosophy and deliverance of equitable care deserves recognition.

SWEDEN’S HEALTH CARE SYSTEM

One of the most widely regarded health care systems around the world is found in Sweden. This European country has been consistently ranked high in the World Health Organization’s health surveys, and came in fourth place on the 2000 list (World Health Organization). Sweden has one of the lowest infant mortality rates with a rate of 3.47 deaths/1000 live births. Life expectancy in the nation is 79.71 years for the entire population, with males averaging 77.07 years and females averaging 82.50 years. As a nation, Sweden has a literacy rate of 99% in its population of almost nine million people (Central Intelligence Agency). As a whole, the Swedish people are a healthy group of people. How did Sweden achieve this high level of health? How is the current health care system structured and financed? What changes are occurring in Sweden and how is the nation responding to these changes? These questions will be addressed in the following section.

Evolution of Sweden’s Health Care System

As a nation, Sweden has long been interested in the health of its population and health care. Since the eighteenth century, politicians around Europe realized the connection between the health and the wealth of a nation. Sweden began collecting data on births, deaths, causes of death, and levels of ill health in its population (Porter 49). In 1749, Sweden, along with Finland, became the first nations in Europe to utilize a national census. The results of the census forced the state into looking at health care. Sweden then began to promote fertility and began educating the population on personal hygiene. The government enacted legislation to isolate and treat victims of sexually and socially transmitted diseases. The state developed municipal hospitals in the eighteenth century in hopes of causing a population growth, which would have strengthened the nation. These regulations were looked after locally and through the government, giving Sweden its beginnings of a national health care system (Porter 54).

This development in health care reduced mortality and resulted in a population growth, which was what the State has intended. The population almost doubled from 1750 to 1850, as a result of the changes in health care. However, the development of Sweden’s health care system was slow. Until the late nineteenth century, only a few Swedish districts had publicly funded physicians working. Most of the physicians were in private practice, spread across the nation (Porter 97). However, one problem that was evident was that the population was reluctant to go to seek physicians and preferred their traditional methods of healing and looking to God for help. Slowly, as the nation became more urbanized, the popularity of physicians grew and medicine prospered. In the early nineteenth century, acute care was emphasized and the number of hospitals grew. There was a growth in the number of publicly funded doctors as well as private practitioners and midwives. The number of physicians in Sweden’s population more than doubled, from 550 in 1850 to 1,131 practitioners in 1900 (Porter 98).

As Sweden’s economy grew in the late nineteenth century, the nation changed from an agricultural society to a more industrial one. Swedish citizens began requesting that the state play a larger role in public health policy. The first Public Health Act was passed in 1874 and it established local health boards that were responsible for clean water supplies, sewage and refuse systems and other local sanitation issues. Some doctors worked as public health officials and looked after local air pollution, unfit housing and the health habits of the population (Porter 98-99). Public health had arrived in Sweden.

By 1900, these measures resulted in a 17% decline in the infant mortality rate and the rate of infectious diseases declined in the adult population (Porter 99). In the 1930s and 1940s, Sweden’s government encouraged reproduction and larger families in order to increase the population. They did this by introducing policies such as marriage loans, maternity benefits, state housing for large families and protection against employment dismissal for pregnant women. And in 1944, universal state child allowance was created (Porter 186).

Around the same time period, a new law covering sickness funds was legislated. It provided health insurance for medical care in addition to cash payments, which used to be paid to workers who were unable to work because of illness. The Social Democratic government believed social welfare was necessary for economic growth and was needed in recession periods. A crucial turning point in Sweden’s health care history was the commission on health care chaired by Alex Höjer in 1943. The Höjer report suggested medical services should be free for all the inhabitants of Sweden, regardless of where in the nation they reside. The report also suggested the co-ordination of public health, hospital care, preventative and ambulatory care should be done at the community or county level. Höjer recommended an integrated health care system, which encompassed preventative and therapeutic health care (Porter 209).

The Swedish government, even with the opposition of the Swedish Medical Association, eventually implemented most of the recommendations for the Höjer report. By the mid-1950s, Sweden considered medical care a right of its citizens. The State was divided into seven different regions, each with a large teaching and research hospital. County councils and District Medical Officers were responsible for hospital patient care in the 1960s. By 1975, county councils had complete responsibility for all state-covered medical care (Porter 209-210).

During the mid-1980s, health care reform was a major issue and county councils were struggling with finding the right solution. The Dagmar Reform was an initiative to restructure the national health insurance payments for physicians. The fee-for-service payment method was replaced with a capitation payment plan, in which the national government gave each county a fixed amount of funding, instead of giving funding for each service performed. This allowed the councils to pay their physicians in whatever way they wished. The Dagmar Reform also resulted in the increase of the number of county councils to twenty-six (Glennerster & Matsaganis 245).

The Current Swedish Health Care System

The current Swedish health care system is based on the basic principle that all citizens have the right to good health. This also includes all citizens, regardless of where they live, their income, or any other factors (Palmberg 47). The Swedish people also experience a high quality of health care (Glennerster and Matsaganis 243).

In order to achieve these goals, the health care system in Sweden is decentralized and predominantly publicly funded. Health care is mostly a public responsibility with local authorities (county councils and the municipalities) administering it. The members of these councils are elected every three years by the citizens (Glennerster & Matsaganis 242). Responsibility for most services - including inpatient, outpatient services, hospitals and health centres, rests with members of the twenty-three county councils and three large local authorities (i.e., three municipalities). The 288 local municipalities in Sweden are responsible for housing and long term care for the elderly population and the disabled. (See Appendix A for a diagram of the structure of the health care system). These county councils can levy taxes on the population in order to generate health care funds which, combined with the federal funds, pay for the system (Palmberg 47). In practice, county council politicians have often become strong advocates of additional health services spending. They often concentrate on pressuring the national government to assume a larger responsibility of the financing of health services (Blomquist 118). The number of people each county council is responsible for ranges from 60,000 to 1.7 million, with the average population in each county being 300,000 people.

The central government’s responsibility includes ensuring that the health care system is efficient and is not in conflict with its own objectives. The federal government can control health care by financial control, new legislation, penalties against those who do not follow the principles and laws, and the granting of permits. The government also conducts the majority of the research on health and is responsible for the training of many of the health care workers. The Ministry of Health and Social Affairs works on policy issues and legislation dealing with broad social concerns. For example, it deals with the social insurance system, health and medical care, alcohol and drug abuse and services for the aged. Central administrative agencies are responsible for the execution and monitoring of these policies (Palmberg 47).

In Sweden’s health care system, there is a limited amount of private health care. Almost all physicians in Sweden, 90 percent are publicly employed, mostly through the county hospitals. Only about 10 percent of physicians work in full-time private practice. In 1994, the total number of physicians employed in the public sector was 22, 400. About 75 percent of these physicians specialized in one field, of which 23 percent are general practitioners (Zweifel, Lyttkens, & Söderström 11). Private hospitals have few short-term beds as 95% of short-term beds are provided through county hospitals (Palmberg 49).

Funding & Financing Health

In total, the county council’s financing accounts for approximately 70 percent of the health care expenditure in Sweden (Zweifel, Lyttkens, & Söderström 257). Physicians employed in the county councils are paid a monthly salary based on their qualification and work schedule. Hospitals receive annual budgets, which include the cost of all staff, drugs and other supplies and equipment. Hospitals are paid by either global budgets or diagnosis related groups (Zweifel, Lyttkens, & Söderström 258). The global budgets are usually determined at the level of a clinic. Institutional spending (e.g., hospitals, clinics, etc.) is the largest expenditure in the Swedish health care system and accounts for about 75 percent of the total health care budget (Glennerster & Matsaganis 244). There is a trend toward decentralization of financial responsibility to encourage cost consciousness of medical staff. The medical staff in hospitals are salaried through diagnosis related groups. Salaries are set in negotiations between the medical staff’s labor union and the employer’s association. Physicians workings in full time private practice are contracted by the county council, with payment based on fee-for-service.