ACM: arrangements between health insurers and hospitals regarding COVID-related costs for 2021 are in the interest of patients
Health insurers and hospitals can make arrangements regarding financial assistance in 2021 in order to prevent far-reaching consequences of the coronavirus (COVID-19) pandemic. The Netherlands Authority for Consumers and Markets (ACM) has approved this initiative. The arrangements ensure continuity of health care to current and future patients, during and after the pandemic. ACM specifically looked into the arrangements concerning catch-up care and expensive prescription drugs. In that context, ACM remains alert to any adverse effects on patients and insured resulting from the practical implementation of these arrangements.
Zorgverzekeraars Nederland (ZN, an umbrella organization of health insurers in the Netherlands), the Netherlands Federation of University Medical Centres (NFU) and the Dutch Hospital Association (NVZ) asked ACM for its opinion about the compatibility of these arrangements with competition rules.
Martijn Snoep, Chairman of the Board of ACM, explains: ‘Hospitals must be able to continue to focus on the treatment of patients, without having to worry too much about the impact of the pandemic on the continuity of health care. Arrangements can be made for 2021 so that hospitals do not have to negotiate individually with different health insurers. Instead, they can get the necessary financial certainty in advance in one go. Without these arrangements, there is a risk that continuity of health care could be jeopardized, and that health insurers could fail to meet their duty of care, right now and in the future.’
What was the problem?
The exact course and impact of the COVID-19 pandemic remain uncertain. That uncertainty carries implications for the supply of health care itself, but it also carries financial implications. Anticipating various scenarios, the joint health insurers and hospitals in late 2020 reached an outline agreement on reimbursing any COVID-19-related costs and lost income in 2021. After working out the details over the spring, the insurers and hospitals asked ACM about the arrangements’ compatibility with competition rules.
What are ACM’s conclusions?
A joint agreement among health insurers and hospitals regarding the reimbursement of health care costs is, in principle, an anticompetitive agreement. However, the arrangements regarding reimbursement of COVID-19-related costs and that of costs related to cancelled or postponed regular care are necessary for guaranteeing the continuity of health care, both during and after the pandemic. Furthermore, the arrangements are temporary, since they only apply to 2021. ACM also recognizes that, when drawing up these arrangements, the insurers and hospitals acted on ACM’s warning in 2020 that the arrangements do not go beyond what is necessary, and that the incentives to procure efficiently remain intact as much as possible.
In its response, ACM draws attention to the subarrangements about catch-up care and expensive drugs. As a result of the pandemic, regular health care services had to be scaled down, and, at some point, must be caught up. ACM warns that hospitals and health insurers cannot make any arrangements that exclude other health care providers such as independent treatment centers. Such arrangements restrict competition, and undermine the efforts to reduce the backlogs. ACM will keep a close watch on this. With regard to expensive drugs, a provision has also been included that hospitals are guaranteed the same margins as in 2020. On the basis of its market assessment, ACM comes to the conclusion that this agreement will not have any appreciable negative effect on the incentives for hospitals to procure actively and competitively, in the interest of patients and insured. In that context, it is essential that this agreement is limited to 2021.
Collaborations in extraordinary times like these
Times like these show that, now more than ever, it is crucial that market participants in the health care sector closely work together, keeping in mind the future, including the foreseeable future. ACM, too, does its part so that markets continue to work well for people and businesses, now and in the future. In that context, ACM offers leeway and trust, but also remains vigilant that any arrangements made are in the interest of patients and insured.