{"id":4588,"date":"2024-10-07T21:46:48","date_gmt":"2024-10-07T19:46:48","guid":{"rendered":"https:\/\/www.rivistaeco.com\/?p=4588"},"modified":"2024-10-07T21:46:48","modified_gmt":"2024-10-07T19:46:48","slug":"is-differentiated-autonomy-harmful-to-health","status":"publish","type":"post","link":"https:\/\/www.rivistaeco.com\/en\/2024\/10\/07\/is-differentiated-autonomy-harmful-to-health\/","title":{"rendered":"Is Differentiated Autonomy Harmful to Health?"},"content":{"rendered":"

Now that differentiated autonomy is law and once the famous LEP (Essential Levels of Performance) are defined, it is likely that regions will request broader competencies, including in health care. Is this beneficial or detrimental for citizens? Will territorial inequalities further increase? In a debate that has been ideologized from the start, we attempt to provide some clarity based on data and facts.<\/span><\/i><\/p>\n

What is the “Differentiated Autonomy” Law and How Could It Affect the Provision of Health Services Nationwide? It is useful to clarify because the debate on the topic is already heavily ideologized and will become even more so with the upcoming referendums.<\/span><\/p>\n

The Law Approved by Parliament<\/b><\/h3>\n

As very well explained by Rossana Arcano, Alessio Capacci, and Giampaolo Galli in the latest issue of <\/span>eco<\/span><\/i>, differentiated autonomy is a framework law recently approved by Parliament. It allows ordinary statute regions to begin a process of requesting the state to “assign functions related to additional forms and special conditions of autonomy […] related to subjects or areas of subjects”\u2014twenty-three to be precise, listed in paragraph 3 of Article 116 of the Constitution (reformed in 2001). The law was strongly desired by Minister Roberto Calderoli and the Lega, reluctantly approved by the government majority (of which the Lega is a part), and universally opposed by the opposition (which has already moved to promote a repeal referendum through individual proponents and regional councils in regions governed by the centre-left). Both the politicians who proposed the law and those who opposed it sold the reform to their voters as a way to retain more resources in the territory, especially in the North.<\/span><\/p>\n

Will It Be the Secession of the Rich?<\/b><\/h3>\n

“The Secession of the Rich,” the catchy title of a recent book by one of the most vocal opponents of the reform, Professor Gianfranco Viesti, will thus be the dominant theme of the next referendum campaign for both supporters and opponents. In reality, the law as written does not allow for such a transfer of resources from poorer to richer regions. It is stipulated that for the subjects that can become the responsibility of the regions but “related to civil and social rights,” the famous LEP must first be identified and guaranteed everywhere in the territory by the state. Additionally, other provisions prevent resources exceeding what is necessary to support LEP spending from remaining in the territories (Article 8 of Law 86\/2024 leaves the verification to a joint state-regions-autonomies commission). The government has taken two years (with a possible extension of another twelve months) to quantify the LEP, in principle already identified by a commission of experts (the Cassese Commission) but lacking the necessary financial quantification. According to the law, regions cannot request additional competencies on LEP subjects until these are quantified. With the law’s approval, regions can start requesting more competencies on non-LEP subjects, which are nine out of twenty-three. For example, the Veneto region has already announced its intention to move quickly. However, even in this case, the resources to be allocated to the regions in exchange for additional competencies will be decided in consultation with the state (the joint state-region commission), and the law is clear that even in the future, the allocated resources must not exceed those necessary to perform the new functions.<\/span><\/p>\n

The Danger of a “Patchwork State”<\/b><\/h3>\n

The fact that the model of differentiated autonomy described in the recently approved law does not lead to the “secession of the rich” feared by some and hoped for by others does not mean it is a good model. The main problem is that it refers to too many subjects without proposing criteria to guide the state-region negotiations in deciding whether it is efficient or reasonable to delegate a particular function to the regions. For example: “Savings banks, rural banks, credit companies with a regional character,” or the regulation of “professions” are all non-LEP subjects immediately assignable to regions, but it is difficult to think that regional regulation could lead to a more efficient credit or labour market. Everything is then entrusted to political mediation, to the agreement between the executives – the national government and the regional council – without Parliament’s intervention, with the risk of excessive and poor decentralization resulting in regions ending up with different sets of competencies. The most likely consequence is the multiplication of legislations and bureaucracies with negative effects on the functioning of the country’s system.<\/span><\/p>\n

The Difference Between LEP and LEA<\/b><\/h3>\n

But what does all this have to do with health care? Hasn’t it already been devolved to the regions? The answer is “not entirely,” so yes, regions could request additional functions in this area. However, “health protection” is undoubtedly a LEP subject, so additional decentralization requests from regions should still wait for their quantification. Here lies a potential major “but”: in the health field, there are already Essential Levels of Assistance (LEA), which represent service objectives decided by the state that regions must obligatorily meet in managing health services (see box). The shared opinion – even by the Cassese Commission – is that LEA are the LEP of health care. But the LEA as currently defined do not resemble the LEP of the Calderoli law because they have never been precisely quantified. In health care, the implicit approach to their quantification follows a top-down mechanism, that is, from the top through the annual definition of the National Standard Health Need based on public budget constraints. In the case of LEP, the reference seems to be a bottom-up approach starting from the standard cost of each single service. Therefore, it must be concluded that for now, and at least until LEP for health care are defined by law, further forms of decentralization in the health field are not possible.<\/span><\/p>\n

LEP<\/strong> (Essential Levels of Performance) are the minimum service requirements to be uniformly guaranteed across the national territory to ensure the social and civil rights enshrined in the Constitution. Specifically, for issues managed by the regions (such as health care, public transport, or education), a national law sets the standards that regional and local administrations must meet. For example, the number of nursery school places to be guaranteed per 100 children or the requirement that every Italian municipality must have a registry office.\u00a0<\/span><\/p>\n

LEA<\/strong> (Essential Levels of Assistance) identify the services and activities that the National Health Service must provide to all citizens free of charge or upon payment of a fee (ticket), funded with public resources collected through general taxation. LEA are organized into three sectors: 1) collective prevention and public health; 2) district care; 3) hospital care. According to data from the Higher Institute of Health, over 5700 types of services and activities for prevention, care, and rehabilitation fall under LEA today.<\/span><\/p>\n

Health Care Decentralization<\/b><\/h3>\n

Opponents of “differentiated autonomy” often attribute the already existing decentralization in health care as the origin of inequality between territories in accessing health services, which could only worsen with further decentralization. But what does it mean today to say that health care is a “decentralized” function to the regions? It does not mean that some regions receive more resources than others: the table below shows the actual per capita funding (in euros) between regions based on the most recent monitoring data provided by the Ministry of Economy and Finance.<\/span><\/p>\n

Per Capita Funding of Regions<\/b><\/h3>\n
\"\"
Source: Ministry of Economy and Finance and Istat-HFA.<\/figcaption><\/figure>\n

Although regions partially finance the regional health fund with “regional” taxes (IRAP and additional IRPEF at standard rates without considering any additional revenue from higher-than-standard rates), producing very different revenue in different territories, the state adds a VAT share (by far the most relevant component of total funding) and, if necessary, other transfers to ensure that in per capita terms each region receives more or less the same resources. Even once LEP for health care are defined, this equitable mechanism should remain unchanged in the new system. However, it is true that health protection has been a laboratory for decentralization processes since the reforms of the early 1990s, when administrative decentralization already provided by the law that established the National Health Service was accompanied by functional decentralization and then the first and only attempt at fiscal decentralization (with the introduction of IRAP and the regional additional IRPEF), that is, the attempt to largely finance the service with regional taxes. In the Constitution, health protection is now a subject of concurrent legislation (Article 117), meaning that regions can already legislate in this field but only within the “general principles” established by state law. Some concrete examples help better understand the mechanism. For example, the number of beds to be guaranteed in hospitals is set by state law: since 2012, the standard is 3.7 beds per thousand inhabitants, of which 0.7 beds are for rehabilitation and 3 for acute care. In this context, regions’ autonomy is expressed in deciding how to distribute hospital facilities in the territory to meet the national standard, also considering the hospital standards set by the state (qualitative, structural, technological, and quantitative). Another example is pediatric vaccinations: they are mandatory based on national law, Law 119\/2017, while regions are responsible for organizing the vaccination campaign and actual vaccine administration. Examples could continue. Essentially, in the current situation, the state enacts framework legislation while regions handle the organization and implementation of services.<\/span><\/p>\n

Differentiated Autonomy in Health Care<\/b><\/h3>\n

So what other competencies could regions request? Answering abstractly is difficult. Instead, it might be useful to refer to the “preliminary agreements” or pre-agreements implementing paragraph 3 of Article 116 of the Constitution signed in 2018 by the Gentiloni government with three Northern regions: Veneto, Lombardy, and Emilia-Romagna. They never had concrete implementation because the agreements were reached shortly before the general elections. Subsequently, with the yellow-green government, regions (particularly Veneto) relaunched by requesting the attribution of functions in all subjects, thus initiating the long season of framework law proposals that eventually led to the Calderoli reform. The pre-agreements, however, focused only on four subjects out of the twenty-three possible: labour policies, vocational education, health protection, and environmental and ecosystem protection. These are all subjects where there is already a strong presence of regional actors. Article 116 was therefore used to marginally expand regions’ competencies on things they already do, not on a huge range of subjects on which they currently have and probably should not have any role. From a constitutional perspective (but we are not jurists), the limited expansion of competencies seems to be the most reasonable interpretation of paragraph 3 of Article 116. The health requests are largely overlapping among the three regions and are listed in the following table.<\/span><\/p>\n

The Gentiloni Government’s 2018 Pre-Agreements on Health Care<\/b><\/h3>\n
    \n
  • Greater autonomy aimed at removing specific spending constraints, particularly concerning personnel management policies.<\/span><\/li>\n
  • Greater autonomy in access to specialization schools, including programming scholarships for medical residents and integrating them with the corporate system. This includes the possibility of providing alternative paths to specialization schools to be negotiated with local universities aimed at stipulating fixed-term “work specialization” contracts to fill staffing needs. On this specific point, only Lombardy also requests greater autonomy in determining the number of places for general practitioner training courses.<\/span><\/li>\n
  • Greater autonomy regarding functions related to the tariff system for reimbursement, remuneration, and co-payment, ensuring that these provisions apply solely to the region’s residents.<\/span><\/li>\n
  • Greater autonomy regarding the governance of healthcare companies and the entities of the regional health service, particularly concerning strategic management bodies, while respecting national rules for selecting healthcare management.<\/span><\/li>\n
  • Regarding decisions on the therapeutic equivalence of drugs, the request is to\u00a0 without intervention by the Italian Medicines Agency (AIFA) – submit documents containing regional technical-scientific evaluations to the national agency and after 180 days use the document’s conclusions to make decisions based on therapeutic equivalence.<\/span><\/li>\n
  • Greater autonomy in planning interventions on the regional health service’s real estate and technological assets within a certain and adequate multi-year resource framework.<\/span><\/li>\n
  • Greater legislative, administrative, and organizational autonomy in establishing and managing supplementary health funds.<\/span><\/li>\n
  • To these common requests, only Emilia-Romagna has also requestes greater autonomy in the direct distribution of drugs.<\/span><\/li>\n
  • To these common requests, only Veneto has requested greater autonomy in personnel matters concerning doctors’ freelance activity and incentives for personnel serving in remote mountain locations.<\/span><\/li>\n<\/ul>\n

    Overall, these are requests that refer to issues regions have repeatedly brought to the government’s attention in the past without receiving responses. Greater managerial autonomy could also increase efficiency in organizing services, reducing spending, and eliminating regulatory duplications and inappropriate constraints. Nevertheless, the potential effects on other regions should be considered. For example, greater autonomy in personnel management in a situation where all regions report shortages of specific professional profiles could lead to competition between territories to attract missing figures. A similar discourse can be made for supplementary health funds: the request signals a significant delay by the central government in proposing a national framework providing a coherent picture of the role funds should play in the Italian health system. Without a national framework, the risk of fragmentation is very high, an example of the “patchwork state.”<\/span><\/p>\n

    No Policies for Convergence Have Ever Been Implemented<\/b><\/h3>\n

    It is very difficult to imagine that implementing the Calderoli reform could lead to a greater disparity of resources in favour of richer territories. It is true that this is what the proponents made their voters believe (eliciting the obvious reaction from others), but it is not what is written in the law. Even in the health field, given the constraints provided by the law, it is unlikely that the resource allocation gap between regions could increase as a result of broader decentralization. Territorial disparities in the quality of health service provision exist, are already monitored, but do not depend (or at least not primarily) on resources as illustrated in the per capita funding table. The problem is that a real mechanism to ensure convergence in the quality of services offered across the territory has never been put in place, based on constraints, incentives, and the importation of competencies and “best practices” from more efficient regions. Central governments have limited themselves to ensuring resources and intervening (with financial recovery plans) where the largest deficits are concentrated without implementing a true convergence policy. The risk is that with this bill, the central government will wash its hands even more.<\/span><\/p>\n

    Bio<\/b><\/em><\/p>\n

    Massimo Bordignon is a full professor of public finance at the Catholic University of Milan, where he also directed the Department of Economics and Finance and the Doctoral School in Public Economics. He is a member of the European Fiscal Board at the European Commission and vice-president of the Italian Public Accounts Observatory.<\/span><\/em><\/p>\n

    Gilberto Turati is a full professor of public finance at the Catholic University of Milan. He is the deputy director of the Italian Public Accounts Observatory and a member of the board of directors of the Italian Society of Public Economics (SIEP). He is part of the editorial board of <\/span>lavoce.info<\/span>.<\/span><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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