Value guided healthcare as a platform for industrial development in Sweden feasibility study

Value guided healthcare as a platform for industrial development in Sweden – feasibility study Conference presentation

Göteborg August 18th, 2009

Unsustainable growth in healthcare spend

Per capita HC exp 2006 €2,650

Per capita HC cost 2006 €2,250

Index (1992=100)

300

Per capita HC cost 2006 €1,850

Index (1992=100)

300

HC Cost

300

GDP

HC Exp GDP

200

100 1992

Wages1

1995

Index (1992=100)

1998

2001

2004

2007

HC Cost

200

100 1992

Wages1 1995

1998

Index (1992=100)

Per capita HC cost 2006 €3,150

300

200

Wages1

GDP

2001

2004

2007

100 1992

1995

1998

Index (1992=100)

Per capita HC cost 2006 € 5,351

300

2001

2004

Per capita HC cost 2006 €3,150

300

HC Cost HC Cost

200

GDP

200

GDP

HC costs 200

GDP

Wages1

Wages1

Wages1 100 1992

1995

1998

2001

2004

2007

100 1992

2007

1995

1998

2001

2004

2007

100 1992

1995

1998

2001

2004

2007

1. Average nominal wage index Note: Index on basis of local currency; Per capita HC cost 2006 at exchange rate of 1 USD=0,797 €, 2005: 110,22 Yen/US$ Source: OECD Health Data 2008; EIU

1

Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Index (1992=100)

Competing in the future healthcare industry

Academia

Payers & Providers

Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Patient • Best possible outcome... • ... at minimal cost

Industry

Source: BCG analysis

2

Current study scope holistic – integrating efforts by many Large interest in outcomes but lack of shared vision, clear leadership and coordination

Scope of study to bring efforts together towards common vision and roadmap

Many stakeholders, past initiatives and projects...

Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Concrete and realistic 10-year vision with healthcare system perspective Current landscape, vision and roadmap discussed with all key stakeholders Roadmap allowing for paced implementation

Source: Stakeholder interviews April – June 2009, BCG analysis

3

Steering and reference group members Role

Carl Bennet

Ordförande i Getinge, Göteborgs Universitet

Anders Ekblom

Vice-President Development AstraZeneca

Maria Anvret

Professor FRCPath, forskningspolitisk talesperson Svenskt Näringsliv, ledamot IVA

Sigbrit Franke

Rådgivare till Umeå & Stockholm Universitet, tidigare Universitetskansler

Claes Ånstrand

Tidigare statssekreterare och landstingsråd

Gunnar Alvan

Tidigare GD Läkemedelsverket

Göran Sandberg

Rektor Umeå Universitet

Kjell Asplund

Tidigare GD Socialstyrelsen

Marie Beckman Suurküla

Sjukhusdirektör Akademiska sjukhuset tillika biträdande landstingsdirektör

Joakim Dillner

Professor, forskare

Anna Hedborg

Tidigare stadsråd och GD

Nina Rehnqvist

Professor, ordförande i SBU

Göran Stiernstedt

Direktör, avd. chef vård och omsorg SKL, tidigare biträdande landstingsdirektör

Ulf Wahlberg

Vice President, industri research relations Ericsson

Gunnar Nemeth

Managing Director and Chief Operating Officer Capio Group

Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Reference Group

Steering group

Name

4

Shared vision and value captured

Way forward Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Agenda

Starting position

5

Sweden's strength in healthcare increasingly challenged Sweden losing clinical trial volumes

Medically trained students shrinking share of Medical faculty PhDs

Drop in registered patents

Ongoing clinical trials per year in Sweden (#)

Patents registered at PRV (#)

600

400

# PhD students at medical faculties1

CAGR

6,000

~-25%

+4% 300 Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

4,000

400

200

-1%

2,000

200 100

0

0

0

Average 95-97

Average 04-08

00

01

02

03

04

05

06

07

08

90

92

94

96

98

00

02

04

06

Industrial chemistry

PhD Students at medical faculties, total

Organic chemistry

PhD students at medical faculties with MD

Biotechnology

1. At Uppsala University, Karolinska Instritutet; Lund University and Gothenburg University Note: CAGR=Compounded Annual Growth Rate Source: Klinisk forskning – ett lyft för sjukvården, Läkemedelsverket; SCB; Teknikområdesbarometern 2006-2008 PRV; BCG Analysis

6

Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Improving healthcare easier said than done

Source: The Economist

7

Payers & Providers

Transparency drives rapid improvements Before Ranked #43 of 73 hospitals

After Care cycle redone PCI1 - unit established Emergency care expanded to 24/7 coverage

1 year mortality 20%, ranked #68 of 73 hospitals

Care aligned with national treatment guidelines2 New specialist departments for specific coronary conditions started

Quality index3 raised from 1 to 8, 30-day mortality reduced by 50% Ranked #22

Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Halmstad hospital

Karlstad central hospital

Example: Myocardial infarction

Quality index raised from 1 to 4 Mortality reduced by 50% Ranked #45

Staffing improved

1. Percutaneous coronary intervention 2. on angiography and PCI 3. Riks-HIA Source: SVT.se; Aftonbladet 2007-03-08; DN 2009-05-06; Dagens Medicin 2008-08-26; Läkartidningen nr 44 vol. 104, 2007; Värmlands Folkblad 10 Oct 2007

8

Value based healthcare new paradigm emerging

Scientists

1980

1990

2000

2010

Efficacy and safety Administrators

Efficiency Clinicians

Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

Pre-1980

Value

Value =

Outcome Cost

• Measured as outcomes, not inputs • Defined around patient, not supplier • Measured over full cycle-of-care

Source: Institute of Strategy and Competitiveness, Harvard Business School; BCG analysis

9

Sweden with strong starting point in quality assessment

>20 registries with >85% patient coverage

Quality registries by start year (# of registries)

Quality registries by patient coverage, start year (# of registries)

80

25 29

22 registries

69

20 60

6 Copyright © 2009 by The Boston Consulting Group, AB. All rights reserved.

69 quality registries started to date1

15 9

40

10 13

14

10 16

7

5

20 8

2

0

3

1

5

7

5 0

3

0

Not 75-80 80-85 85-90 90-95 95-00 00-05 05-09 Total known

>85%

75-85%