The system of health accounts in Italy

The system of health accounts in Italy

September 27, 2017

The expenditure is at the center of the public debate on sustainability of the welfare model, but there is not a system of comparisons with Europe


Italy’s health expenditure amounts roughly to € 150 billion in 2016 (8.9% of gross domestic product): this level affects public budget decisions and poses questions on the sustainability of the national welfare system. Complete information on health expenditure is essential to assess the effects of Italian population ageing, which can affect both the level and the composition of health care expenditure in years to come.

Particularly relevant is the evaluation of resources devoted to long-term care facilities, most influenced by increasing longevity and a rise in the share of elderly population. The composition of health expenditure also allows to assess the direct impact on some industries (e.g. pharmaceutical industry, heath care goods, medical-technical products, hospital and outpatient care services, residential long-term care facilities). 


Prominent role of the Government and compulsory contributory health care financing schemes

Despite its relevance, it’s not easy to find consistent information on the level and composition of health care spending, internationally meaningful. To address these issues an international project on health accounts has been developed with the aim to provide internationally comparable data on current health expenditure (i.e. final consumption expenditure on health care goods and services) by health care functions, providers and financing schemes.

The analysis of health expenditure by financing schemes confirms for Italy the prominent role of the Government and compulsory contributory health care financing schemes and medical saving accounts, which in 2016 contributed up to the 75% of overall expenditure, while the voluntary health care payment schemes and household out-of-pocket payments contributed to the remaining 25%. However it’s very well worth noting that the share of public financial schemes in Italy is lower than in the other main European countries, such as Germany (84,6%), France (78,8%), the Netherlands (80,8%) and United Kingdom (79,2%). In these countries the largest share of public health care expenditure is covered by compulsory schemes and the government plays a residual role. Only in United Kingdom the situation is similar. 

Current health expenditure by financing schemes and health care functions, providers (000 000 €, 2016)
Source: ISTAT

Expenditure focused on inpatient and outpatient and rehabilitative care and medical goods

In Italy health expenditure is focused on three main functions: the inpatient and rehabilitative care (28,0% of total spending in 2016, € 42 billion), the outpatient and rehabilitative care (22,4%) and medical goods (17,8%). Between 2012 and 2016 there has been a significant rebalancing of health expenditure, with inpatient care down by 3,8%, outpatient care up by 9,2% and medical goods  up by 11,2%. The long-term health care, often matter of concern, still represents a limited share (10,1% nel 2016), lower than that of the other European countries (16,3% in Germany and 18,2% in UK). Its rate of growth has been subdued in recent years (3,9%),  just above that of total health expenditure (3,5%).

The health care is mainly provided by hospitals (45,5% of expenditure, equal to € 68 billion), outpatient providers (22,4%, € 33 billion) and by retailers and other providers of medical goods (16,7%, € 25 billion). The hospitals’ shares on health expenditure looks quite high also in international terms: among main European countries only UK (41,8%) and France (40,2%) show similar shares, while Germany (29,2%) has a lower share. The role of retailers of medical goods in healthcare provision looks different between European countries; Italy ranks between Germany (19,5%) and France (18,9%) on one side and Netherlands  (12,2%) and United Kingdom (11,5%) on the other.

The heaIth accounts allow further analysis on per-capita expenditure and on health spending shares of Gdp. Overall the detailed information now available show that the perception of health care overspending is not confirmed by aggregate data, but require more in-depth analysis relating to specific categories of heath care.