Embedded Files
PEER-REVIEWED ARTICLES
Vaihtoehtoja kannustavampaan hyvinvointialueiden rahoitukseen with Mika Kortelainen, Taru Haula, Tuukka Holster, and Marja-Lisa Laukkonen (Finnish Medical Journal, Accepted for publication)
Vaihtoehtoja kannustavampaan hyvinvointialueiden rahoitukseen with Mika Kortelainen, Taru Haula, Tuukka Holster, and Marja-Lisa Laukkonen (Finnish Medical Journal, Accepted for publication)
Title in English: Improving incentives in the financing of publicly provided health and social care services in Finland
Abstract: The current Finnish health and social care funding model is based on need-adjusted capitation, which aims to ensure equal access to services but provides weak incentives for preventive care and cost efficiency. Since funding is allocated based on observed service needs, regions may have little motivation to invest in preventive care, as reduced morbidity could lower their funding. Additionally, the soft budget constraint may encourage inefficient resource use, as overspending regions could receive supplementary state funding. Introducing a taxation right for well-being service counties could enhance financial accountability and mitigate the soft budget constraint issue. Performance-based financing (Pay-for-Performance) could improve service quality and efficiency, but international evidence on its effectiveness remains mixed. Any funding reform must carefully balance need-based allocation with efficiency incentives while ensuring long-term system sustainability and equitable service provision across regions.
Tiivistelmä: Nykyinen suomalainen sosiaali- ja terveydenhuollon rahoitusmalli perustuu pääosin tarveperusteiseen kapitaatioon, jonka tavoitteena on turvata palvelujen yhdenvertainen saatavuus. Malli tarjoaa kuitenkin heikot kannustimet ennaltaehkäisevään toimintaan ja tehokkaaseen palvelutuotantoon. Ennaltaehkäisyyn panostaminen voi vähentää sairastavuutta ja siten laskea havaittua palvelutarvetta ja rahoitusta. Lisäksi pehmeä budjettirajoite voi heikentää taloudellista kurinalaisuutta, jos ylitetyt menot korvataan valtion lisärahoituksella. Hyvinvointialueille myönnettävä verotusoikeus voisi vahvistaa taloudellista vastuuta ja lieventää pehmeän budjettirajoitteen riskiä. Kannustinperusteinen rahoitus (Pay-for-Performance) taas voisi edistää palvelujen laatua ja tehokkuutta, mutta kansainvälinen tutkimusnäyttö sen vaikuttavuudesta on edelleen vaihtelevaa. Mahdollisessa rahoitusuudistuksessa tulee huolellisesti tasapainottaa tarveperusteinen kohdentaminen ja tehokkuuskannustimet sekä turvata järjestelmän pitkäjänteinen kestävyys ja palvelujen tasapuolinen saatavuus eri alueilla.
DOI: TBA
Overuse of medical imaging and effects of payer-provider integration (Health Economics Review, 2025)
Overuse of medical imaging and effects of payer-provider integration (Health Economics Review, 2025)
Abstract:
Background Healthcare expenditures have risen in middle- and high-income countries. One of the potential contributors is the overuse of diagnostics. I explore whether medical imaging is overused when privately owned clinics in Finland treat patients with voluntary private health insurance (VPHI).
Methods I employ administrative insurance claims data from a major Finnish insurance company, covering 2016–2019, and exploit two market entries of clinics owned by the company in 2017. The underlying assumption is that the insurance company’s own clinics had weaker incentives to overuse imaging than other privately owned clinics because the payer and the provider belonged to the same entity. I identify the overuse using the staggered difference-in-differences (DID) strategy, in which I consider patients from cities with a market entry as the treatment group and compare them to patients in other similar cities.
Results I find that the market entries decreased the use of radiography and ultrasound imaging in the treatment of VPHI policyholders, suggesting that private clinics overused these imaging technologies. The more expensive computed tomography (CT) and magnetic resonance imaging (MRI) were, however, not overused.
Conclusions The results show that private clinics in Finland overused some imaging technologies when treating VPHI policyholders. The extent and magnitude of overuse can, however, vary considerably between imaging technologies and medical ailments.
Private health insurance in universal public healthcare system: the role of healthcare provision in Finland (Health Policy, 2023)
Private health insurance in universal public healthcare system: the role of healthcare provision in Finland (Health Policy, 2023)
Abstract: Voluntary private health insurance (VPHI) has gained popularity in universal public healthcare systems. We studied how the local provision of healthcare services contributed to the VPHI take-up in Finland. Nationwide register data from a Finnish insurance company was aggregated to the local level and augmented with high-quality data on public and private primary care providers. Controlling for sociodemographic characteristics, we found that the private healthcare provision explained the VPHI take-up more than public healthcare provision. The VPHI take-up was negatively associated with distance to the nearest private clinic, while the associations with distance to public health stations were statistically weak. Fees and co-payments of healthcare services were not associated with the insurance take-up, meaning that the geographical closeness of providers explained the take-up more than the price of services. In addition, we found that the VPHI take-up was higher when local employment, income, and education levels were higher, and that sociodemographic characteristics were more important in explaining the VPHI take-up than the local healthcare provision. The results were similar for adults and children.
Code for retrieving the open source data: https://drive.google.com/file/d/1IkdVL9cs8U1HlDwkOeZS_yovLP-BkDt9/view?usp=share_link
WORKING PAPERS AND OTHER PUBLICATIONS
Payers, providers and patients: Studies on healthcare markets in Finland
Payers, providers and patients: Studies on healthcare markets in Finland
Type: PhD dissertation
Abstract: In this doctoral dissertation, I empirically study three topics in health economics, concerning the interplay between patients, providers, and payers in Finnish healthcare markets. The findings contribute to both the economic literature and policymaking. Each topic is addressed in a separate article. The first article studies the effects of a regional patient choice reform for planned surgeries in Finland. The reform entitled surgical patients from one Finnish region to choose any hospital within that region. Using the rest of the country as a control group, we show that the reform decreased waiting times without compromising clinical quality or increasing average surgical expenditure. The study shows that policymakers can enhance the public healthcare system by increasing patients’ choice possibilities. The second article investigates the effect of providers’ financial incentives on the utilisation of medical imaging. I exploit the market entry of two insurance company-owned clinics as a quasi-experiment to show that financial incentives lead to overuse of radiography and ultrasound imaging in diagnosing accident patients. No impact was found for the utilisation of computed tomography (CT) and magnetic resonance imaging (MRI), or for any imaging in diagnosing patients treated for illnesses. The third article examines the factors associated with voluntary private health insurance popularity in Finland. Using register data from a Finnish insurance company, combined with information on the geographic proximity and fees of public and private primary care providers, I find that insurance take-up is not strongly related to the supply of healthcare services. Instead, the popularity is closely associated with socioeconomic characteristics.
Tiivistelmä: Tässä tohtorintutkielmassa tutkin empiirisesti kolmea terveystaloustieteen teemaa, jotka koskevat potilaiden, palvelutuottajien ja maksajien vuorovaikutusta Suomen terveydenhuoltomarkkinoilla. Tutkimustulokset ovat merkittäviä tutkimustiedon ja politiikkatoimien näkökulmasta. Jokaista teemaa tarkastellaan omassa artikkelissaan. Ensimmäisessä artikkelissa tutkimme Pirkanmaan erityisvastuualueen valinnanvapauskokeilun vaikutuksia. Alueen kiireettömät leikkauspotilaat saivat mahdollisuuden valita hoitopaikakseen minkä tahansa alueen sairaaloista. Vertaamalla heitä muualla Suomessa asuneisiin potilaisiin osoitamme, että kokeilu lyhensi jonotusaikoja vaikuttamatta kliiniseen laatuun tai keskimääräisiin kustannuksiin. Tutkimus osoittaa, että julkisen terveydenhuollon toimivuutta voidaan parantaa potilaiden valinnanvapausmahdollisuuksia lisäämällä. Toisessa artikkelissa tutkin taloudellisten kannustinten vaikutusta yksityisesti vakuutettujen potilaiden kuvantamiseen hyödyntämällä vakuutusyhtiön omistamien sairaaloiden avaamista kvasikokeellisena asetelmana. Osoitan, että taloudelliset kannusteet johtivat röntgen- ja ultraäänikuvantamisen liialliseen käyttöön tapaturmapotilaiden diagnosoinnissa. Sen sijaan kannustimilla ei ollut vaikutusta tietokonetomografian ja magneettikuvauksen käyttöön, eikä kuvantamiseen sairauksien diagnosoinnissa. Kolmannessa artikkelissa tutkin, mitkä tekijät ovat yhteydessä vapaaehtoisten tapaturma- ja sairauskuluvakuutusten suosioon Suomessa. Käytän suomalaisen vakuutusyhtiön rekisteriaineistoa yhdistettynä tietoon palvelutuottajien sijainneista ja asiakashinnoista. Osoitan, että vakuutusten suosio ei liity niinkään julkisen ja yksityisen terveydenhuollon tarjontaan, vaan enemmän korkeampien sosioekonomisten ryhmien mieltymyksiin.
Hyvinvointialueiden sote-rahoituksen tarvevakiointimalli: Päivitys 2025 with Tuukka Holster, Taru Haula, Merja Korajoki, and Marja-Lisa Laukkonen
Hyvinvointialueiden sote-rahoituksen tarvevakiointimalli: Päivitys 2025 with Tuukka Holster, Taru Haula, Merja Korajoki, and Marja-Lisa Laukkonen
Type: Working paper
Title in English: Need adjustment for financing health and social services in Finland: Update 2025
Abstract: The discussion paper proposes an update to the need adjustment model used in the needs-based financing of Finnish wellbeing services counties. These counties are responsible for the public provision of health and social care services in Finland, covering healthcare, elderly care, and social care. The discussion paper evaluates the proposed model primarily in relation to the currently employed model and potential alternatives, and presents results regarding the uncertainty associated with estimation of these models. The proposed model is assessed both in terms of its statistical predictive power and the incentives it provides. Statistical predictive power is evaluated using both individual-level microdata and county-level time series data. The discussion paper also describes how the needs adjustment model fits into the overall financing model and how the model can be developed in future. Additionally, it assesses the potential upper limits of the predictive power in need-adjustment models when using individual-level data. The proposed model predicts the social care service utilisation significantly better than the currently employed model and therefore represents a substantial improvement. The paper proposes an updated disease classification which predicts healthcare and elderly care service utilisation considerably better than the disease classification used in England's NHS financing model. However, model selection remains challenging, and even the updated models do not approach the estimated upper limit for predictive power.
Tiivistelmä: Työpaperissa kuvataan THL:n asiantuntijoiden tekemä ehdotus hyvinvointialueiden sote-palvelujen tarveperusteisessa rahoituksessa käytettyjen terveydenhuollon, vanhustenhuollon ja sosiaalihuollon tarvevakiointimallien päivittämiseksi, arvioidaan ehdotettuja malleja pääasiassa suhteessa nykytilan mukaisiin ja vaihtoehtoisiin malleihin, ja esitetään tuloksia malleihin perustuviin palvelutarvelaskelmiin liittyvästä epävarmuudesta. Ehdotettua mallia arvioidaan sekä tilastollisen ennustekyvyn että mahdollisten kannustevaikutusten suhteen. Tilastollista ennustekykyä arvioidaan sekä henkilötason aineistossa että hyvinvointialuetason aikasarjassa. Työpaperissa kuvataan myös, miten tarvevakiointimalli istuu rahoitusmallin kokonaisuuteen ja miten mallia voidaan tulevaisuudessa kehittää. Lisäksi arvioidaan, kuinka korkeaan ennustekykyyn tarvevakiointimallit voisivat parhaimmillaan päästä henkilötason aineistossa. Ehdotetut mallit ennustavat huomattavasti nykyisin käytettyjä malleja paremmin erityisesti sosiaalihuollon palvelukäytön kustannuksia ja ovat siksi selkeä edistysaskel nykyiseen verrattuna. Malleihin sisältyvä päivitetty sairausluokitus ennustaa terveyden- ja vanhustenhuollon palvelukäyttöä myös selkeästi paremmin kuin Englannin NHS:n rahoitusmallissa käytetty sairausluokitus. Mallivalintaan jää kuitenkin epävarmuutta, eikä nyt päivitetyillä malleillakaan pääse vielä lähelle arvioitua, korkeinta mahdollista ennustekykyä.
Chapter 5: Hyvinvointialueiden rahoitus ja tarvetekijät with Tuukka Holster, Taru Haula, Juha Honkatukia, and Marja-Lisa Laukkonen. In Tilannekuvia hyvinvointialueilta – muutokset palvelujärjestelmässä sote-uudistuksen alkuvuosina (ed. Tynkkynen et al.).
Chapter 5: Hyvinvointialueiden rahoitus ja tarvetekijät with Tuukka Holster, Taru Haula, Juha Honkatukia, and Marja-Lisa Laukkonen. In Tilannekuvia hyvinvointialueilta – muutokset palvelujärjestelmässä sote-uudistuksen alkuvuosina (ed. Tynkkynen et al.).
Type: Report
Publication title in English: Situational pictures from wellbeing services counties – changes in the service system from the early years of the health and social services reform
Chapter title in English: Financing and need-adjustment of wellbeing services counties
Hospital Choice and Patient Outcomes: Evidence from Regional Choice Reform with Tanja Saxell, Liisa Laine, Luigi Siciliani, and Mika Kortelainen
Hospital Choice and Patient Outcomes: Evidence from Regional Choice Reform with Tanja Saxell, Liisa Laine, Luigi Siciliani, and Mika Kortelainen
Type: Working paper
Abstract: We study the effects of introducing choice and non-price competition into public health care markets with heterogeneous producers. We use a difference-in-differences design based on a regional patient choice reform and comprehensive administrative data on orthopedic surgeries in Finland. We find that the reform led to a reallocation of patients towards large teaching hospitals, increasing concentration in their markets. Waiting times decreased and more patients received care in all the hospitals exposed to the reform, with little effect on clinical quality or surgical expenditure. Back-of-the-envelope calculations reveal that in aggregate, the introduction of the market-based mechanism has sizable social benefits.
WORK IN PROGRESS
Effects of Primary Care Clinic Closures: How Older People's Geographical Distance to Care Affects Health and Service Use? with Tiina Hetemaa, Tuukka Holster, Mika Kortelainen, Marja-Lisa Laukkonen, Kaisa Palo, Markku Satokangas, and Vuokko Heikinheimo
Effects of Primary Care Clinic Closures: How Older People's Geographical Distance to Care Affects Health and Service Use? with Tiina Hetemaa, Tuukka Holster, Mika Kortelainen, Marja-Lisa Laukkonen, Kaisa Palo, Markku Satokangas, and Vuokko Heikinheimo
Abstract:
Objectives. In Finland, health stations are the main providers of primary health care services for a significant proportion of the population—especially children, the unemployed and pensioners. Tightening budgets have, however, led policymakers to consider increasing efficiency in public primary care by closing down health stations and replacing contact services with telemedicine. There has been extensive public debate over the effects of the closures, but only little scientific evidence to support it. The existing research is concentrated on specialised care and/or estimated correlations between closures and their potential outcomes. This research provides scientific evidence for the policymakers and contributes to the existing literature by uncovering causal effects of closures in the primary care setting. In addition, we estimate the effects of closures on a wide range of outcomes, which allows for a broader view on the issue and a comparative analysis between different effects.
Data and methods. Our data is based on Statistics Finland’s administrative and detailed microdata, which covers characteristics and healthcare use of the entire Finnish population in 2013–2019. The data on healthcare use include publicly provided primary and specialised care (Finnish Institute for Health and Welfare) as well as a great deal of privately provided care (Social Insurance Institution of Finland). We also have annual data on the locations of citizens residences and health stations. We gather the health station location data from online sources and exploit it to determine closures of the stations. We use the staggered difference-in-differences method to estimate how the closure of an individual’s nearest health station affected her use of public primary care, private primary care as well as public emergency and specialised care. To uncover health effects, we use mortality and preventable hospitalisations as outcomes. It is likely that the closures will increase congestion in the nearby health stations and, hence, we also estimate the effect of closures on the citizens whose nearest health stations receive more patients. Finally, we conduct heterogeneity analysis based on sociodemographic characteristics, such as age and education level.
Results and conclusions. We will test a working hypothesis that closures and the associated increases in travel distance decrease affected citizens’ use of healthcare services and deteriorate their health. In addition, we expect to find that there are significant sociodemographic differences between, for example, the young and the old population as well as different income groups.
Health station data: TBA
Statistical code: TBA
The Effects of Supply on Dentist Labor Markets: Evidence from Dental School Closures in Finland with Mikko Herzig and Allan Seuri
The Effects of Supply on Dentist Labor Markets: Evidence from Dental School Closures in Finland with Mikko Herzig and Allan Seuri
Abstract: Problems in the supply of medical doctors---even outright shortages---have become common around the world, causing multiple problems. This paper provides causal empirical evidence on how changes in doctor supply affect doctors' earnings by utilizing a quasi-experimental design on the unexpected closures and subsequent re-openings of Finnish dental schools. These closures first cut the national dentist student intake in half (-49%) and later increased it accordingly, creating major labor supply shocks. We identify the effect of the negative and positive labor supply shocks on dentists' earnings with the difference-in-differences method and multiple identification strategies. In the second part of the paper, we aim to deepen our analysis by identifying the wider effects of restricted dentist supply. We show what happens to patients, other dental professionals, public sector dental care expenditures, as well as sociodemographic composition of dental school applicants and students.
Statistical code: TBA
Pay-for-performance in single-payer public healthcare systems: a narrative review with Taru Haula, Tuukka Holster, and Marja-Lisa Laukkonen
Pay-for-performance in single-payer public healthcare systems: a narrative review with Taru Haula, Tuukka Holster, and Marja-Lisa Laukkonen
Abstract: Pay-for-performance (P4P) schemes have been studied extensively. The institutional features, however, may have significant impact on their functioning. This study provides a synthesis of the evidence concerning P4P in single-payer public healthcare systems: the UK, New Zealand, and the Nordic countries. Our narrative literature review aims to identify how P4P schemes have been implemented in these countries and what their effects have been on care processes, access, service use, care quality and patient health. We identified the articles by going though the previous 27 systematic literature reviews and choosing the articles which concerned P4P schemes in the countries of interest. We further conducted searches in PubMed, Web of Science and Google Scholar to identify grey literature and recently published peer-reviewed articles not included in the reviews.
Abstract: The war in Ukraine has shocked European politics and showcased the brutality and totality of war. Finland has long been preparing for such a conflict, adopting a now-envied model of total defense. A prime example of this is the National Defense Course. Four times a year, a group of citizens receive invitations to the Course based on their importance to national defense. They form the elite of the country’s political, business, governmental, and academic leadership, and the Course enables them to bond with each other. This paper investigates the private gains from war preparation by focusing on these elite peer networks gained through the courses, by utilizing a causal design that exploits the variation in timing of attendance in a staggered differences-in-differences (DID) setting and uses rich individual level data on attendance and earnings.
Research privacy notice (tietosuojaseloste): TBA
Pre-analysis plan and pre-specified statistical code: TBA
Final statistical code: TBA
PRE-PHD WORK
Työaikakonvergenssi yhdentyvässä Euroopassa: havaintoja vuosilta 1995–2015
Työaikakonvergenssi yhdentyvässä Euroopassa: havaintoja vuosilta 1995–2015
Type: Master's thesis
Title in English: Working time convergence in Europe: findings from 1995–2015
Abstract: Tutkimuksessa analysoidaan työaikojen konvergenssia Euroopassa ajanjaksolla 1995–2015. Lisäksi tarkastellaan aiemman tutkimuskirjallisuuden avulla, ovatko tämän tutkimuksen konvergenssitulokset yhdensuuntaisia tuottavuuden ja palkkojen kehityksen kanssa. Työaikakonvergenssia testataan poikittaismenetelmillä, joita ovat σ- ja β-konvergenssimenetelmät. β-konvergenssia tutkitaan sekä absoluuttisessa että ehdollisessa mielessä. Ehdollisessa konvergenssissa otetaan kiinteiden maakohtaisten vaikutusten lisäksi huomioon osa-aikatyön ja naisten työssäkäynnin yleisyys. Estimointi tehdään käyttämällä Eurostatin työvoimatutkimuksen tilastoja keskimääräisistä todellisista viikkotyötunneista. Empiiristen tulosten perusteella keskimääräiset viikkotyöajat ovat σ- ja β-konvergoituneet Euroopassa. Kokonaistason tarkastelun lisäksi tarkastellaan erikseen sekä naisten ja miesten että osa-aikaisten ja kokoaikaisten työllisten työaikakonvergenssia. Osajoukot ovat β-konvergoituneet kaikissa maaryhmissä. Myös kaikkien osajoukkojen σ-konvergenssia on havaittavissa lähes kaikissa maaryhmissä. Osa-aikaisten työllisten konvergoitumiskehitys vanhoissa jäsenmaissa sekä EU:n ulkopuolisissa sisämarkkinamaissa poikkeaa Euroopan konvergoitumistrendistä, sillä osa-aikaisten viikkotyötunnit eivät ole konvergoituneet näissä maaryhmissä. Toinen poikkeus ovat naispuoliset työlliset uusissa jäsenmaissa ja EU:n ulkopuolisissa sisämarkkinamaissa. Absoluuttinen β-konvergenssi on ollut maaryhmästä riippumatta heikompaa kuin ehdollinen β-konvergenssi. Tulokset ovat yhdenmukaisia tuottavuus- ja palkkakonvergenssien kanssa, sillä aikaisemman tutkimuskirjallisuuden mukaan myös työn tuottavuus ja nimelliset palkat ovat konvergoituneet Euroopassa.
Finnish Economic Policy Council Report 2016. Chapter 3: Employment and hours worked – an international comparison with Teemu Lyytikäinen & Jukka Pirttilä
Finnish Economic Policy Council Report 2016. Chapter 3: Employment and hours worked – an international comparison with Teemu Lyytikäinen & Jukka Pirttilä
Type: Policy report
The economic policy strategy is critically dependent on increasing the employment rate. The employment rate is currently low for cyclical reasons, but as argued in Chapter 2, the government target of an employment rate of 72% requires structural changes. It is accordingly important to assess the potential to increase labour force participation and employment. To bring this discussion into perspective, this chapter considers employment and hours worked in a comparative perspective. Specifically, Finland is compared to seven other countries (Denmark, France, Germany, the Netherlands, Sweden, the UK and the US). The countries were chosen partly to reflect variation in the outcomes and partly to compare Finland to a group of countries that are most relevant. In order to analyse employment and hours worked by age, gender and education level, we use comparable microdata for these countries. The data span over the period 1995–2014.
Total labour input measured in terms of the total of hours worked by the population is the relevant metric for the overall performance of the economy (production) and it is therefore important to consider both how many persons are in employment (the extensive margin) and their working hours (the intensive margin). In its competitiveness pact, the government also aims to increase the annual hours worked by employed persons by 24 hours, and the chapter also discusses whether this goal is sufficient.
URL: https://talouspolitiikanarviointineuvosto.fi/en/reports/report-2016/
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