Norway: #24 in the 2021 World Index of Healthcare Innovation
Norway’s oil-powered growth has helped fund its socialized health system — for now.
By Gregg Girvan, Mark Dornauer, and Avik Roy
Introduction
Norway ranked 24th overall in the 2021 WIHI Analysis — a steep drop from 12th the year before. In particular, Norway dropped steeply in the Dimension for Fiscal Sustainability (from 17th to 28th), as recent data showed significant growth in public health spending. Furthermore, Norway ranked low in the Dimension for Choice at 28th (but up one spot from the year before). Nevertheless, the Norwegian socialized health care system provided excellent quality for its patients and ranked 9th in the Dimension for Quality.
Background
The discovery of oil in the North Sea in 1969 transformed Norway into one of the world’s wealthiest nations for the last four decades. As Norway’s economy grew, the country expanded its socialized health care system for its citizens. Today, four Regional Health Authorities comprise the Norwegian health care system (much like Britain’s four National Health Services) with 21 hospital trusts.
Norway funds its public system through several taxes — including national and municipal taxes. Norway’s health insurance coverage is universal and automatic for all residents. Like many socialized health care systems, the primary burden of providing care falls upon Norway’s various municipalities, with funding provided by the federal government. Subsequently, Norway’s Ministry of Health plays an indirect role in health care by establishing budgets and legislation to outline essential health benefits for all Norwegian citizens. Ultimately, Parliament determines what services are covered, even if there is no defined benefit package.
Only about 8 percent of the Norwegian population holds private health insurance, which is supplemental. Employers mainly purchase private health insurance to incentivize and provide employees faster access to publicly covered elective services and better choices among private providers. Nevertheless, private health insurance covers less than 5 percent of all elective health care services.
Nearly all Norwegian hospitals are public, with some private not-for-profit and a handful of for-profit hospitals that only offer elective treatments. All general practitioner and specialist visits require copayments, including outpatient hospital care and same-day surgery. Public providers cannot charge patients above pre-determined amounts for their services (other than for bandages and miscellaneous medical supplies).
Lastly, Norway’s robust economic growth kept its debt-to-GDP ratio low (below 16 percent), as Norwegian health expenditures represented 9.9 percent of its GDP in 2015. Public financing for the system — via national and municipal taxes — accounted for 85 percent of its national health expenditure. Nevertheless, Norway’s health care spending is rapidly increasing — raising long-term concerns over the future of its health care system.
Quality
Norway ranked 9th in the WIHI Dimension for Quality — two spots below its initial ranking in 2020). However, Norway’s fall is less an indictment against the Norwegian health system and more of a reflection of incorporating the Element “Pandemic Preparedness and Response” in the new composite rankings. In the Element above, Norway ranked 6th (an impressive standing). Additionally, Norway performed exceptionally well in the Element “Infrastructure” (2nd), reflecting a modern hospital and outpatient care system. Furthermore, Norway ranked above the median in its ability to vaccinate its population (reflected in the Element “Measures of Preventable Disease” at 13th). However, Norway’s lack of patient-centered care caused a dip in its Quality standing, as it ranked 21st in the Element “Patient-Centered Care.”
Choice
Norway ranked 27th in the Dimension for Choice. Admittedly, while the Norwegian health system offers an impressive level of quality for its services, it struggles to provide patients with autonomy and choice in their medical care. Its health insurance is also expensive. Accordingly, Norway ranked 28th in the Element “Freedom to Choose Health Care Services” and 24th in the Element “Affordability of Health Insurance.” For many Norwegians, health insurance is expensive, and they have little choice in deciding the insurance and benefits they want.
Science & Technology
Norway ranked 12th in the WIHI Dimension for Science & Technology. Accordingly, Norway ranked above the median in the Elements “Medical Advances” (14th) and “Scientific Discoveries” (13th). While its medical advances and scientific contributions to the global community ranked near the median, its nationwide EHR adoption ranked in the top third of all WIHI nations (measured in the Element “IT” at 7th).
Fiscal Sustainability
Norway’s socialized health care system ranked 28th in the WIHI Dimension for Fiscal Sustainability. Admittedly, Norway’s strong economy helped it rank 8th in the Element measuring “National Solvency” (this included Norway’s excellent debt-to-GDP ratio thanks to a high national GDP). Nevertheless, Norway dedicates massive resources (per capita) to public health spending, and its rate of growth for health spending increased steadily over the last decade. Subsequently, Norway struggled in the Elements measuring “Public Health Care Spending” (28th) and “Growth in Public Health Spending” (29th).
