# Presentation: 707256

## Role of General Health Insurance Company (VZP) in the Czech health insurance market today and tomorrow

**Role of General Health Insurance Company (VZP) in the Czech health insurance market today and tomorrow**

***Pavel Horak, M.D., Ph******.******D.,****** ******MBA, General Director***

**Prague**** September 24, 200****7**

## Health Insurance System CRtoday and tomorrow

**Covers all persons with permanent residence in the Czech Republic and persons – employees of an employer whose seat is located in the Czech Republic**
**European health care and health care insurance market will become more and more interconnected**
**Basic principles will not change**
**Compulsory participation**
**Solidarity**
**Free choice of the healthcare provider**** ****(at least for certain products****)**

## VZP CR is the biggest health insurance company in the Czech Republic

**Some indicators of VZP CR**** 2007**

| Average number of all insured |   6 545 000 |
| --- | --- |
| From that – premium paid by the state |   3 755 000 |
| Total revenues in millions USD 2007 (exp.)  |          6 709 |
|    -  Collection of premiums in millions USD 2007 |          4 390 |
|     -   Payment of the state in millions USD 2007 |          2 319 |
| Reimbursements to providers in millions  USD  |          6 195 |
| Operational costs in millions USD |             205 |

## Unlike in the past, debt and deficits are not a problem for VZP anymoreCurrently VZP is financially stable 

## Contractual Healthcare Facilities

**Significant changes are expected to occur**
**(****# hospitals, ownership, contracting policies)**
**Outpatient healthcare facilities                  3****3**** ****750**
**Inpatient healthcare facilities in total             26****7**
**Spas****	****	****  ****	****                                        ****    ****4****5**
**Convalescent homes                                         **** **** 5**
**Medical transport services                              5****31**
**Rescue services****        ****                                       1****73**
**Pharmacies and medical aid dispensaries 2 3****67**

## ORGANIZATIONAL STRUCTURE OF VZP CZ

- Organizational structure is formed with the Head Office, regional branches (14) and workplaces (75)
- Head Office executes decisions of the Supervisory Board, it decides on activities of the insurance company, it is responsible for cooperation with state authorities, other bodies of the public administration, with corporate and natural persons, and it executes other activities that are connected to the public health insurance
- Tomorrow standard corporate governance will be introduced during transformation to state owned stock company

## VZP Guiding Principles for the future

**Consumer centric**
**Provider friendly**
**Evidence based**
**Transparency**

**Change from the tax office to the insurance company is the biggest goal for the future**

**Population scale public insurance**

## VZP moves to:

**Have common front end for all customer interactions and standard repeatable processes across locations**
**Real time claims submission, real time eligibility and deductible status**
**Support of e-health, electronic prescribing and chip EHIC**
**Centralized IT architecture and processing, paperless transactions**
**employ empowered motivated and well trained people**

## CHALLENGES

- Transformation from the tax office to the insurance company
- Insurance contracts with insured, selling multiple insurance products
- Possible integration with injury insurance, sick funds even with disability payment

## Medical Challenges

**Ischemic Heart Disease, Smoking, HBP**
**Tumors, Oncology diseases**
**Diabetes and Obesity**
**Demographics**

## Where to go - Care management

**Horizontally integrated disease management**
**Trend management on broad population**
**Promotion of certification and standardization of services, quality management**

## COST DRIVERS

**Ageing population**
**Drive for quality and higher comfort of care, high expectations of population about delivery of state of the art medical care **
**Care evolves away from treating acute episodes towards chronic and/or expensive conditions**
**New expensive drugs incl. orphan drugs, genomics and biologicals to treat these conditions**
**Technology improvements**

## VZP Goal to Manage Health Care Costs is to Engage:

**Patients (responsibility****, ****multiple choice products)**
**Providers (price competition)**
**Medical societies (EBM)**
**Producers (SCA, PVA, PPC)**
**Employers (shared responsibility)**

## Drive for quality
Negotiate prices
Make coverage decisions
Adopt guidelines based on evidence and comparative effectiveness and linking it to Pay for Performance
Patient safety and information
Incentives to promote healthy behavior
Electronic records (EMR, EHR, PHR)

- Negotiate prices
- Make coverage decisions
- Adopt guidelines based on evidence and comparative effectiveness and linking it to Pay for Performance
- Patient safety and information
- Incentives to promote healthy behavior
- Electronic records (EMR, EHR, PHR)

**Where to go****:**

## Benefits Design to Manage Health Care Costs

**Deductibles and coinsurance**
**Value based insurance**
**Value based formulary**
**Enablement of multiple product portfolios**
**Integrating financial component into health care product**

## Thank You for Your Attention