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The Danish health care system: evolution - not revolution - in a decentralized system

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Author Info

  • Kjeld M�ller Pedersen

    (Institute of Public Health, Health Economics, University of Southern Denmark, Denmark)

  • Terkel Christiansen

    (Institute of Public Health, Health Economics, University of Southern Denmark, Denmark)

  • Mickael Bech

    (Institute of Public Health, Health Economics, University of Southern Denmark, Denmark)

Abstract

The Danish health care system has undergone gradual changes, but not radical reforms, from 1970 until 2004. Theoretically, the development can be viewed from the perspective of fiscal federalism, decentralization, and incentives embodied in reimbursement systems. Furthermore, path dependence and incrementalism have characterized the system. The Danish health care system is decentralized politically, financially, and operationally. The counties are responsible for health care, and finance it out of county income and property taxes along with block grants from the state. Hospitals are publicly owned while general practitioners are private entrepreneurs working on contract with the counties. Hospital services and GP and specialist services are free, while there are co-payments for drugs, adult dental care, physiotherapy and the like. Co-payments make up close to 19% of total health expenditures. The system has been characterized by expenditure control, reasonable positive development in productivity, and a high degree of patient and citizen satisfaction despite waiting lists. Free choice of hospital was introduced more than 10 years ago. It has recently been expanded so that after waiting 2 months for treatments like elective surgery at public hospitals, citizens can choose either private hospitals or go abroad with full payment from public funds. The thinking behind decentralization gradually has been eroded for a number of reasons. This has led to a reform that will be effective as of January 2007. The number of counties will be reduced, but the new regions retain responsibility for health care. A national earmarked health tax will be introduced so that the regions will receive revenues from state block grants and municipal co-payment, for instance an amount per hospitalization. Copyright © 2005 John Wiley & Sons, Ltd.

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Bibliographic Info

Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 14 (2005)
Issue (Month): S1 ()
Pages: S41-S57

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Handle: RePEc:wly:hlthec:v:14:y:2005:i:s1:p:s41-s57

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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References

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Citations

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Cited by:
  1. Hai Zhong, 2010. "The impact of decentralization of health care administration on equity in health and health care in Canada," International Journal of Health Care Finance and Economics, Springer, vol. 10(3), pages 219-237, September.
  2. Mickael Bech & Jørgen Lauridsen, 2009. "Exploring spatial patterns in general practice expenditure," The European Journal of Health Economics, Springer, vol. 10(3), pages 243-254, July.
  3. Bech, Mickael & Lauridsen, Jørgen, 2008. "Exploring the spatial pattern in hospital admissions," Health Policy, Elsevier, vol. 87(1), pages 50-62, July.
  4. Oliver Reich & Cornelia Weins & Claudia Schusterschitz & Magdalena Thöni, 2012. "Exploring the disparities of regional health care expenditures in Switzerland: some empirical evidence," The European Journal of Health Economics, Springer, vol. 13(2), pages 193-202, April.
  5. Anni Ankjær-Jensen & Pernille Rosling & Lone Bilde, 2006. "Variable prospective financing in the Danish hospital sector and the development of a Danish case-mix system," Health Care Management Science, Springer, vol. 9(3), pages 259-268, August.

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