Norway: #12 in the 2020 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 ranks #12 overall in the World Index of Healthcare Innovation with a score of 48.26. Norway performed best in Quality (64.16, #7), with strong infrastructure and health outcomes. However, Norway’s socialized system heavily restricts patient options and access to new therapies, ranking second-to-last in Choice (32.06, #29).
Norway’s robust economic growth has kept its debt-to-GDP ratio low, at 15.8%. Norwegian health expenditures represented 9.9 percent of GDP in 2015, with public financing via national and municipal taxes accounting for 85 percent of this spending. However, health care spending is rapidly growing.
Background
The discovery of oil in the North Sea in 1969 has powered the growth of the Norwegian economy in recent decades, transforming the Nordic country from a backwater into one of the world’s wealthiest nations. Norway’s socialized health care system is divided into four Regional Health Authorities, much like Britain’s four National Health Services, with 21 hospital trusts.
Norway funds its public system through general tax revenue and national and municipal taxes, and coverage is universal and automatic for all residents. Like many socialized health systems, the primary burden of providing care falls upon Norway’s various municipalities, with funding being provided by the federal government. Norway’s Ministry of Health plays an indirect role by establishing budgets and legislation to provide funding and outline essential health benefits for all Norwegian citizens. Parliament determines what services are covered, even if there is no defined benefit package.
Only about 8 percent of the population holds private health insurance, which is supplemental and mainly purchased by employers to provide employees quicker access to publicly-covered elective services and better choice among private providers. However, private health insurance covers less than 5 percent of elective services. Nearly all hospitals are public, and some private not-for-profit and very few for-profit hospitals offer only elective treatments. All general practitioner and specialist visits, including outpatient hospital care and same-day surgery, require copayments. Public providers cannot charge patients above certain amounts, other than for bandages and other medical supplies.
Quality
Norway ranked well in overall quality (7th). This ranking was buoyed by a modern health system infrastructure (2 of 31) and Norway’s ability to monitor and measure preventable diseases well (9 of 31). However, patient-centered services are lacking in the Norwegian system (22nd), causing a dip in overall quality to 7th.
Choice
Norway’s health system performs well among certain metrics, but it struggled in WIHI’s overall choice analysis — ranking 29 of 31. Most notably, health insurance is expensive, and patients are given little choice as to the insurance they want. These findings are reflected in the low rankings of affordability of health insurance (24th) and the freedom to choose health care services (28th).
Science & Technology
Norway ranks near the top third of countries for overall innovation (11th). While its medical and scientific innovation ranks around the median, its nationwide EHR adoption ranks in the top third (8th).
Fiscal Sustainability
The WIHI analysis examined several factors regarding overall fiscal sustainability. Among them, Norway performed exceptionally regarding its debt-to-GDP ratio (3rd) due to a high national GDP. However, Norway dedicates massive resources to public health spending per capita (24th) and the growth of health spending steadily increased over the last decade, resulting in a 17th overall ranking in the subcategory.
