Italy: #28 in the 2021 World Index for Healthcare Innovation
Italy’s socialized health care system performs mediocre-to-poorly across the board.
By Gregg Girvan, Mark Dornauer, and Avik Roy
Introduction
Sadly, the Covid-19 pandemic exposed the shortcomings of Italy’s socialized health care system.
Italy ranked 28th overall in the 2021 WIHI Analysis and performed below average across four Dimensions — ranking 25th for Quality, 29th for Choice, 24th for Science & Technology, and 25th for Fiscal Sustainability. While Italy’s health care costs are relatively low compared to its European peers, it offers patients limited choices for new therapies and primary care providers. For instance, once Italian citizens select a primary care provider, they cannot change that doctor for a year.
Background
Italy’s socialized health system began with the creation of the Italian National Health Service (Servizio Sanitario Nazionale, or SSN) in 1978. The SSN divides into three jurisdictions at the national, regional, and local levels — including 19 regions and two autonomous provinces. Each region enjoys significant autonomy in the distribution of its health care services, with the central government controlling the distribution of tax revenue to the areas to provide care.
Ultimately, corporate and value-added taxes finance Italy’s single-payer system alongside general and regional tax revenue. Total health care expenditures for Italy’s 60.8 million residents are around 9.1 percent of national GDP. Public financing (i.e., taxes) accounted for 75.8 percent of total health spending in 2014, with private health insurance accounting for approximately one percent. For Italians, public health insurance covers the “essential levels of care” (livelli essenziali di assistenza, or LEA), akin to the “essential health benefits” seen in other developed countries. For services outside of these LEAs, private health insurance covers these elective procedures. Private insurance offers more comprehensive primary care provider options and offers additional amenities in hospitals for approximately 6 million people (just under 10 percent of the population).
Hospitals in Italy are primarily public (with 80 percent of all hospital beds) alongside a smaller contingent of private hospitals (20 percent of all hospital beds). Public hospitals are either managed directly by local health units or operate as semi-independent public enterprises. Under these arrangements, hospital-based physicians are salaried and are often discouraged from treating patients with private insurance. Public-hospital physicians are prohibited from treating patients in a private hospital; if they see private patients in a public hospital, they must pay a portion of their extra income to that hospital.
Several national directorates oversee specific areas of health care to control national costs, with several holding key roles in cost containment. The National Committee for Medical Devices develops cost-benefit analysis and outlines reference pricing for medical devices. Similarly, the National Pharmaceutical Agency analyzes and sets prescription drug prices and reimbursement rates. Payment rates for hospital and outpatient specialist care are determined regionally, with national rates serving as references.
Quality
Italy ranked 25th in the WIHI Dimension for Quality. In particular, two WIHI Elements weighted Italy toward this number: “Pandemic Preparedness and Response” (at 26th) and “Patient-Centered Care” (at 25th). The Covid-19 pandemic’s effects devastated Italy, primarily due to an aging hospital infrastructure and an older patient population (due to Italian citizens’ remarkably long lifespan). Nonetheless, the Element that analyzed Italy’s hospital infrastructure (i.e., “Infrastructure”) ranked at the median at 15th. Similarly, Italy ranked 15th for the Element “Measures of Preventable Disease.”
Choice
Italy ranked 29th in the WIHI Dimension for Choice. While Italy ranked above the median in the WIHI Element for “Affordability of Health Insurance” (12th) and below the median for “Access to New Medical Treatments” (19th), it ranked second to last for “Freedom to Choose Health Care Services” (30th).
Science & Technology
Italy performed below average in the WIHI Dimension for Science & Technology (24th). In particular, its national adoption of health IT remained low and ranked 30th in the Element “IT.” Similarly, Italy’s contribution to “Medical Advances” and “Scientific Discoveries” ranked 19th and 22nd, respectively, in the various Elements.
Fiscal Sustainability
Italy ranked 25th in the Dimension for Fiscal Sustainability. Admittedly, the fiscal health of the Italian health care system remains an open question. While its growth of health spending as a share of GDP over the last ten years plummeted (and ranked 4th overall in the Element for “Growth in Public Health Spending”), its national solvency remained a concern, ranking 29th in the Element “National Solvency.” Like Greece and Spain, the economic effects of the global recession and the Covid-19 pandemic remain evident on the Italian economy.
