Frequently asked questions about the health and social services reform

This site provides answers to frequently asked questions. The questions have been divided into two parts:

1.                   General questions about the health and social services reform

2.                   Questions and answers on the incorporation of health and social services.

1. Frequently asked questions about the health and social services reform

  • What are public health and social services?

    Public health and social services are services the state finances through tax revenue. In future the counties will be organising all public health and social services.

    • outpatient services
    • hospital services
    • oral health services
    • mental health and substance abuse services
    • maternity and child health clinics
    • social work for adults
    • child protection
    • services for people with disabilities
    • housing services for older people
    • home care
    • transportation service
    • environmental health services
  • What are the goals of health, social services and regional government reform?

    The health, social services and regional government reform gives the public administration of Finland a clear three-tier structure: state, county and municipality. The aim is to modernise administration and services so that they are client-oriented and cost-effective. It is intended that the reform will come into force on 1 January 2019.

    The goal of the health and social services reform is to decrease the gap in citizens’ health and wellbeing, improve the equality, availability and impact of services and to curb rising costs.

    The objective of the regional government reform is to coordinate regional state administration and county government and to create an appropriate division of responsibilities between regional state administration, the counties and the municipalities.

    How will the administration model outlined by the government help to reduce the sustainability gap?

    Resources can be used more effectively when services are organised by the 18 counties instead of the current municipalities and joint municipal authorities. A precondition for this is seamless coordination of primary and specialised health and social services. This will make it possible to reduce institutionalised care, strengthen preventive work and delay the service needs of older people. Counties are larger and stronger organisers than municipalities, which will enable a better division of responsibilities and efficient use of new service forms.

    The introduction of digital service modes will also have a major role in achieving savings. In addition, interoperable ICT systems will promote good information flow between different actors. In order to mainstream good practices and to implement management by resources and contents, adequately strong central government steering will be needed.

     

  • Why should the health and social services reform also curb rising costs?

    The ageing of the population will increase the need for health and care services. According to estimates, the service need caused by ageing will increase service needs as much as 70 percent for the services for elderly people and about 20 percent for healthcare by 2035 compared to the current situation. In addition, the production costs of services have increased, and it is expected that the prices will continue to increase at a faster rate than the general price development.

    Reforming the system is necessary if we want to simultaneously fulfil the public service pledge regarding the availability and quality of treatment and care and to ensure the sustainability of public finances.

    A major part of health and social services are produced with tax revenue, and an additional challenge is that the total tax rate is considerably high in Finland already.

  • How will central government steering and autonomous counties be reconciled?

    According to the government, strong central government steering will ensure that the residents’ fundamental rights are realised and that the services are coordinated in a client-oriented manner. Strong steering will also be needed in information management and ICT services. In other respects, central government steering will be based on a negotiation procedure with the counties. The counties will be autonomous. The residents and the county council elected by them will have an authentic possibility of making decisions on the finances and operation of the county. This aim will also be promoted by the allocation of central government financing as a general transfer with no earmarking. The counties will have broad decision-making powers in the organisation of service provision structures.

  • What tasks will be transferred to the counties in addition to health and social services?

    Starting from 1 January 2019, counties will be responsible for rescue services in addition to health and social services. Moreover, it is intended that the counties will become responsible for environmental healthcare, rural development, promoting and financing agriculture as well as tasks related to payments to farmers, developing and funding business and innovation environments, certain planning and financing tasks of transport, steering and planning of land use as well as the promotion of regional identity and culture, and other regional services provided under legislation. A separate proposal will be made on the transfer of these other duties, and it will be submitted to Parliament during the spring session 2017.

  • Will the buildings owned by municipalities be transferred to the counties?

    The funds and debts of hospital districts and special welfare districts and regional councils will be transferred to counties, and all real estate and facilities will be transferred alongside as well. Movable property related to organising health and social services will be transferred from municipalities to counties. The facilities of municipal health and social services will not be transferred to the counties; the counties will rent the facilities for a fixed period of 3 years. The continued preparations will also involve searching for a solution to ensure that any unused facilities and repair backlog would not remain as a financial burden of individual municipalities.

  • How will transfers of personnel be carried out, and will they impact employee benefits?

    Following the principles of business transfer, the health and social service personnel of municipalities and joint municipal authorities, as well as part of the support service employees, will become employees of the counties. Additionally, some 5,000 employees from regional state administration will be transferred to the counties. This matter will be separately provided for in a Government proposal to be submitted to the Parliament in spring 2017. A total of over 220,000 persons will become employees of the counties and their corporations.

    The legislation on local government officials, labour legislation and legislation on collective agreements for public servants will continue to apply to the personnel. Their provisions will be amended to also include the personnel of the counties. The counties will join Keva (previously Local Government Pensions Institute), and the personnel of the counties will also be within the scope of the local government pensions system in the future. Local Government Employers KT will also serve as the employer representative of the counties in the future. The costs of personnel transfers and harmonisation of pay will be minimised.

    The counties’ status in the new employer organisation will be determined by their personnel numbers and economic weight. Corporations owned by the counties may choose whether or not to join the local government pension system and the collective agreements for the municipal sector and counties.

  • What are the counties’ joint support services?

    National service centres will be established for the counties, and support services required by the counties will be centralised in these centres. Counties’ joint support services include the Service Centre for Facilities and Real Estate Management, the Service Centre for ICT Services and the Service Centre for Administrative and Human Rights Management.

    Counties may also establish joint support services with municipalities or other public sector partners.

    The purpose of establishing a service centre is to create savings and provide the best expertise for all counties, therefore ensuring the even quality of support services in all counties.

  • How will the operation of the counties be financed?

    The operation of the counties will be financed by the central government and with client fees and other usage fees collected by the counties. The main principle is that central government financing will be allocated to the counties as a universal central government transfer. In this way, the county itself can decide how the funds will be used for service provision.

  • Will client fees go up?

    The legislation on client fees will be reformed. The drafting of this legislation will start in spring 2017. The cash-basis principles for health and social services will be brought closer together in order to make service coordination easier. Services will continue to contain client fees, as this is important in terms of the clients’ personal responsibility and curbing of costs.

  • When will the first county council elections take place?

    According to the proposal, the first county elections will be held in connection with the 2018 presidential election. The election day is Sunday 28 January 2018. County elections are provided for in the Election Act.

    In 2021 and onwards, county elections will be held in April simultaneously with municipal elections.

  • Who will exercise the highest power in a county?

    The highest power in a county will lie with the county council. It is responsible for the operation and finances of the county.

  • Will the county residents be able to influence the operation of the county?

    Yes. County residents and service users have the right to participate in and influence the operation of the county by for example participating in discussions and hearings, resident councils, county bodies and the planning and development of services.

    The purpose of the county council is to ensure that there are various and effective participation possibilities available for the residents. The county strategy needs to take into account and specify the residents’ possibilities to participate and influence.

    Also, the residents have the right of initiative in matters concerning the operation of the county.

  • How will the language rights of the clients and patients be ensured in the health and social services reform?

    Language rights are laid down in four acts. These are the current Language Act, Sámi Language Act and Sign Language Act as well as the Act on Organising Health and Social Services under preparation. According to the Language Act, a public authority must on its own initiative ensure that an individual’s language rights are fulfilled in practice. The Language Act concerns the national languages, Finnish and Swedish. The organising county is responsible for the realisation of residents’ legal rights (including language rights).

    When services are organised, activities must be planned to be compliant with the language legislation. The legislative proposal on the arrangement of health and social services states the following on developing services: The region of Lapland is tasked with supporting the development of services in Sámi. The development operations of Uusimaa region are tasked with supporting the development of Swedish-language services throughout the country.

  • What does the public service pledge mean?

    The purpose of the public service pledge is to inform the county residents how the services are being implemented in practice. At the same time, it will promote the organisation of health and social services so that the views and needs of clients are also taken into account. The purpose of the public service pledge is also to make operation more transparent and improve the quality, impact and cost-effectiveness of services in this way. A publicly announced service pledge gives the county residents the opportunity to monitor and estimate how the services are being realised. This way, it will also be possible to give feedback and make suggestions to improve the practical implementation of services. The service pledge cannot be used to expand or decrease current statutory services. Changes must be made laid down in an act.

  • What does the integration of health and social services mean?

    The integration of health and social services means that all services will be under the management of a single structure, that is, the county. The counties will be responsible for coordinating the services into a client-oriented entity and forming effective service and care chains. This will apply to public health and social services, both at primary and specialised level. All financing will also go through the county to service providers. The county additionally has the duty to ensure that public, private and third sector services within the scope of the clients' freedom of choice work together, information flows smoothly, and the services meet quality criteria.

  • How will service organisation and provision be separated in the counties?

    The organisation and provision of services will be performed by different organisations in the counties. The county must separate service provision from the other operation of the county. For this purpose, the county will have an unincorporated enterprise.

    As the organiser, the county will be responsible for official duties, the overall functioning of the service system, and the realisation of fundamental rights. Public authority will only be exercised under liability for acts in office.

  • How will versatile services be secured in all counties?

    Provisions aiming to ensure that private and third sector services will increasingly be available in addition to publicly provided health and social services will be included in the act on organising health and social services and the new service provider act. The concrete preconditions for a genuine multi-provider model and freedom of choice are already in place in all areas of Finland.

    If the service structure of a county is not diverse enough, the government could request from the county a report on the situation. Under the new legislation, the county may be obliged to organise a tendering process if other steering interventions have not rectified the situation. The government will also consider special competition regulations to prevent the formation of excessively large service provider clusters.

  • What are collaborative catchment areas?

    The counties will be grouped into five collaborative catchment areas for the purpose of regional service cooperation and joint research and development activities. There will be a university hospital in each of the five catchment areas (Helsinki, Turku, Tampere, Oulu and Kuopio). The collaborative catchment areas will be formed based on the current specific catchment areas. The counties of a particular collaborative catchment area will draw up a cooperation agreement for health and social services, in which agreement is made on matters such as services provided across the county boundaries and health and social service investments to be made in the collaborative catchment area.

  • Which services will be centralised and provided regionally or nationally?

    Services and procedures requiring a large population base, a large number of clients and specialisation, as well as other less common and more expensive services and procedures, will be centralised at either a national or regional level to five university hospitals or seven other hospital units operating on a broad basis around the clock. This will be ensured through cooperation obligations applying to all counties. Expertise in specialised level social services may also be gathered to larger clusters, but an effort will be made to deliver services close to the clients.

    Provisions on the coordination of health and social services organised by the counties will initially be contained in the Health Care Act and, at a later date, in the act on organising health and social services. In keeping with the Government Programme, the implementation of the reform will begin in healthcare even before the health, social services and regional government reform package enters into force on 1 January 2019. The Government has made a presentation to the Parliament regarding the reform of the health and social services 24-hour service system on 27 October 2016. It is intended that the Act will take effect on 1 January 2017. The planned transitional period for the Decrees issued under legislation is 1-3 years. The distribution of duties of around the clock on-call hospitals, putting together surgical activities and the joint 24-hour services of health and social services would nevertheless happen no later than 1 January 2018. Provisions on social welfare tasks that will be centralised nationally and regionally will be laid down later.

    For further information visit: alueuudistus.fi/erikoissairaanhoito-ja-paivystys

     

  • Will local services disappear?

    The county's responsibility will be to make sure that health and social services are available and reasonably accessible for everyone. New methods will also be used here. In sparsely populated rural areas, for example, electronic and mobile services must also be used to secure availability. In addition, the county has the responsibility to produce services so that the sufficient availability and appropriate economic aspects can be ensured. A county will provide residents with public health and social services, including in cases where these services are not otherwise available. These include situations where there are not enough service providers within the scope of freedom of choice for clients in rural areas.

  • What is the role of digitalisation in the reform?

    Digitalisation has a major role in the reform. Productivity studies indicate that approximately one half of the efficiency and productivity benefits in the activities will be derived from the utilisation of ICT and digitalisation. By using digitalisation, clients can be encouraged to assume more responsibility for their personal health and wellbeing. Digitalisation will also be an opening for new types of business related to wellbeing technology and genetic engineering.

     

  • What acts will be passed as part of the health, social services and regional government reform package and what is the schedule of their drafting?

    The most central acts within the reform are the Countries Act, the Act on Organising Health and Social Services, the Implementation Act and the Act of Financing of the Counties. In addition, several acts need to be amended due to the reform. The changes concern for example tax legislation, the act on central government transfers to local government for basic public services, legislation on the status of employees, election legislation and some general administration legislation. Also, legislation on the provision of health and social services will be changed.

    These acts are related to establishing the new counties and to health and social services. The legislative package has been collected as a government proposal that was circulated for comments in August 2016. The summary on the received comments was finished in early December. After this, the Government will make a decision on the final proposal. The aim is to submit the proposal to Parliament in January 2017. The proposal on the freedom of choice and simplification of multisource financing will be published in December 2016.

    In May, the Ministry of Finance started preparing counties’ other tasks other than health and social services under the title of regional government reform. The legislative drafts of this reform are not included in the material published in June. They are due to be circulated for comments in early 2017.

    The freedom of choice legislation and its government proposal are meant to be circulated for comments after Christmas.

     

2. Frequently asked questions about the incorporation of health and social services

  • Why do we need private and third sector services alongside public health and social services?

    The Government wants to ensure genuine freedom of choice and a multi-provider model. This is why there will be provisions in the counties act and the act on organising health and social services aiming to ensure that private and third sector services will increasingly be available in addition to public sector health and social services. Private and organisational providers will increase the diversity of production. They will spur public provision toward better quality and cost-effectiveness as well as new, innovative service methods.

  • What is the basis for the activities of multiple different providers?

    The regulations on competitive neutrality will serve as a foundation for the activities of multiple producers. Experts from the Ministry of Employment and the Economy and the Finnish Competition and Consumer Authority will be involved in preparing them. The principles applying to private and public service providers will be as uniform as possible. To ensure this, the same legislation will regulate the registration and monitoring of both public and private service providers, applying as uniform conditions as possible.

  • Will local services disappear?

    The county's responsibility will be to make sure that health and social services are available and reasonably accessible for everyone. New methods will also be used here. In sparsely populated rural areas, for example, electronic and mobile services must also be used to secure availability. In addition, the county has the responsibility to produce services so that the sufficient availability and appropriate economic aspects can be ensured. A county will provide residents with public health and social services, including in cases where these services are not otherwise available. These include situations where there are not enough service providers within the scope of freedom of choice for clients in rural areas.

  • Will the model lead to only a few international companies making a profit?

    The aim of the Government is that small and medium-sized enterprises (SMEs) will also be able to operate on the market. The counties will include the strategy for service provision in the county strategy. The strategy must take into account the possibility of SMEs the provide services.

    The Government is also considering special rules on competition. Compared to current competition legislation, the rules would enable intervening when an enterprise is starting to be too domineering in a certain area, for instance due to company acquisitions.

    The aim of the Government is to expand the market in a controlled manner and to form a healthy market. As an organising body, the county will see to the services of the whole county in an effective and cost-effective way. Counties’ production companies will, for their part, maintain competition and ensure a diverse range of services.

  • Which public health and social services are being planned for incorporation?

    According to the Government policy, counties will incorporate those of their health and social services that are provided on market terms. Private and public providers of direct-selection services will be governed by principles that are as unified as possible. The counties’ companies will be publicly owned corporations. Incorporation does not mean privatisation.

  • Will organisations also have to incorporate their health and social services?

    No. The government policy only applies to counties. The obligation of incorporation comes from European Union legislation. A registered association may act as a service provider in a service funded by the county that is within the scope of the freedom of choice in the same way as a limited liability company. If the organisation receives Finnish Slot Machine Association grants or other state aid for non-profit activities, in the interest of clarity, many organisations incorporate their fee-paying service activities or transfer them to a separate association or foundation. When an organisation’s fee-paying activities compete in the market, this solution is recommended from the viewpoint of EU law.

  • What is the obligation of incorporation based on?

    The obligation of incorporation is based on European Union state aid legislation and its interpretation in situations where the wide client's and patient’s freedom of choice has been taken into use in Finland. In this legislation, the public, private and third sector provision is mainly in a position that is as equal as possible for primary-level services. The EU legislation requires operational prerequisites that are as equal as possible when there is genuine competition between private and public operators. This kind of situation emerges when the user can freely choose between different service provides.

    Incorporation is a simple way based on consistent interpretation of EU legislation to ensure equal scope of action for public and private provision. It is also a way to avoid the risks with interpretation. The purpose of the Government is to utilise the market in a controlled way.

    Incorporation opens a possibility for one organisation to provide services tasked to public authorities and services on the market that are within the scope of the client's wide freedom of choice. This requires transparency of different remits. With transparency, the incorporation model can be used to realise the integration of the official duties and of health and social services and other production.

  • Can municipalities act as health and social service providers by incorporation?

    They cannot. The health and social services and personnel of municipalities and joint municipal authorities will be transferred to the counties. Municipalities will not organise or provide health and social services in the future. From the beginning of 2019, counties will be responsible for these tasks.

  • Does all operation need to be incorporated?

    It does not. Fulfilling the obligations of public power does not need to be incorporated. In addition, the tasks requiring significant exercise of public power cannot be transferred to corporations at all. The county will be provided an opportunity to give some official duties to a company owned by the county to the extent that public administrative tasks can be issued to be handled by a corporation under the Finnish Constitution. Also, alternative methods of separating the county organisation and provision into different organisations will be created into legislation alongside incorporation. The unincorporated enterprise of the county would provide services that are not within the scope of direct choice services. The act on organising health and social services is meant to define when the service can be provided by the county and when it needs to be incorporated.

  • How will exercising public power and official duties be handled?

    The county, as organiser, is responsible for official duties, and obligations and decisions related to exercising public power. Possibilities of using a corporation to perform some official duties (Section 124 of the Constitution) will be provided for when drafting the legislation (see question on whether all operation needs to be incorporated).

  • Does incorporation always lead to profit seeking?

    No. According to the Limited Liability Companies Act, a company can also be founded as a not-for-profit Company.

  • How will costs be managed in the new operating system?

    Competition will be directed toward making more effective solutions. Financing models will be developed so that service providers are paid more for generating health and wellbeing than for single instances of providing treatment.

  • What will happen to the personnel?

    Employment prospects for the health and social service professionals are very good. Many of the current municipal workers are retiring, and the service needs of the aging population are increasing. In the future, the problem will more likely be costs caused by competition for expert personnel. Similarly, support services need expert personnel. The Government has committed to following the principles of good human resources policy in the legislation regarding the reform and the implementation of the reform.

  • What happens if there is no private or third sector service provision in some county?

    If the service structure of a county is not diverse enough, the government could request from the county a report on the situation. Under the new legislation, the county may be obliged to organise a tendering process if other steering interventions have not rectified the situation. The government will also consider special competition regulations to prevent the formation of excessively large service provider clusters.

  • How will the equal status of different service providers be ensured in relation to the county?

    The regulations on competitive neutrality will serve as a foundation for the activities of multiple producers. The principles applying to private and public service providers will be as uniform as possible. To ensure this, the same legislation will regulate the registration and monitoring of both public and private service providers, applying as uniform conditions as possible.

    The government's objective is that small and medium-sized businesses will also be able to operate in this market and that digital and other innovative service models will be taken into use. In sparsely populated rural areas, for example, electronic and mobile services must also be used to secure availability. Similarly, care will be taken to make sure that the counties have opportunities to produce their own range of services.

    The counties will incorporate those services which are provided on market terms in the form of publicly owned corporations. Incorporation does not mean privatisation.