Page 112 - Effective healthcare cost containment policies Using the Netherlands as a case study - Niek W. Stadhouders

Chapter 5
test whether these tools are used in practice. Insurers may face additional barriers to active purchasing relating to market differences, such as provider concentration, capital intensity and differences in types of care (e.g. inpatient versus outpatient). We test the effect of these potential barriers.
We research which role entry and exit of Dutch health providers has on the height of the MVI by identifying new providers, and excluding new providers from the main analysis. Combining the hospital and long-term care sector, 463 providers entered the market in the research period for a total of €532 million of revenue in the first year (0.15% of the macro budget). In the same period, 92 providers exited the market, having a cumulative €260 million of revenue before exit (0.07%). Entry and exit are both relatively marginal phenomena, responsible for about 0.1 percentage point change in the budget annually (Appendix figure 5.4). These low entry and exit rates indicate little active purchasing to promote new and innovative providers, consistent with low volatility in both hospital care and LTC.
Market entry and exit
Selective contracting is an important tool for active purchasing in hospital sector (Enthoven, 1993). The extent of selective contracting may be viewed as a proxy for active purchasing. Some anecdotal evidence from the Czech Republic suggests that selective contracting in a multi-payer system could lead to distinct changes in market shares, although the size of these changes is not documented (Busse et al., 2001). Therefore, we research the extent of selective contracting in the hospital sector.
Selective contracting
Data on selective contracting is obtained from Mediquest, a company that constructs online tools for consumers to facilitate insurance plan choice. Before 2015, few reliable data were available on the extent of selective contracting. Therefore, we use selective contracting and provider budget data from 2015/2016. Selective contracting data consist of an overview per provider of 1655 potential types of care that may be contracted (for example, breast cancer care). For each of the 1655 types of care, it is documented which types of care are actually provided by the hospital/ITC. On average, hospitals and ITCs provide 475, respectively 37 types of care. For each of the nine insurers, it is documented whether each type of care is contracted or not contracted for each provider. This allows calculation of an average contract index per insurer for each hospital/ITC, ranging from zero (not contracted for any type of care) to one (contracted for all types of care). For example, if insurer A contracts provider X for 300 of the 400 potential types of care, the insurer contracting index
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