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Private service provision


Municipalities buy, for their residents, various health and social services from private operators. Similarly, the new health and social services model could enable an arrangement where health and social services centres (HSS centres) and unincorporated county enterprises would supplement their own service provision by purchasing services from companies and organisations.

In addition, private operators could offer freedom-of-choice services to county residents. Freedom-of-choice services would include services provided by HSS centres and dental clinics as well as services provided against health and social services vouchers and personal budgets.

It is estimated that the services organised within the scope of freedom of choice would account for some 29 per cent of the health and social services organised by the counties. This would mean that the funding for freedom of choice would be around EUR 5.3 billion at the 2016 prices, while the funding for all public health and social services would be EUR 18.6 billion. The numbers contain both counties' own service provision and private provision of freedom-of-choice services.

As a rough estimate, the service provision would be divided between private and public provision throughout the country as follows:

  • HSS centres and dental clinics (private 35%, public 65%)
  • services against HSS vouchers (private 50%, county-owned companies 50%*)
  • services against personal budgets (private 50%, county-owned companies 50%)

* Unincorporated county enterprises grant HSS vouchers and personal budgets. The unincorporated county enterprise cannot itself provide services against services vouchers or personal budgets. If counties want to provide these services, they must provide them by county-owned companies that operate separated from the unincorporated county enterprise.
 

The current share of private provision and an estimate of the situation in future

Freedom of choice is estimated to increase the share of private social services from the current 33% to 39% (an increase of EUR 500 million). The share of private health services is estimated to increase from the current 6% to 13% by the year 2024 (an increase of EUR 800 million). These sums only cover the increase of private provision when freedom of choice will be extended. 
 

Clients' choices determine how the services are divided

It is not possible to calculate accurate estimates in advance because the division of service provision between the different operators depends on clients' choices. Conditions and compensations set by counties also have a significant impact on the service network and the number of service providers.

New providers will increase their share of services proportionately more in health services than in social services, because municipalities already outsource a good share of their social services to private providers.

In social welfare services, part of the currently outsourced services will be replaced by new means of freedom of choice, in particular by HSS vouchers and personal budgets. This change will be smaller in health services. According to estimates, the share of entirely new service provision will therefore be smaller in social welfare services than in health services.


Inquiries

Raija Volk, Director, Ministry of Social Affairs and Health, tel. +358 295 163 263
Piia Pekola, Senior Specialist, Ministry of Social Affairs and Health tel.
+358 295 163 694
Mikko Meuronen, Senior Specialist, Ministry of Social Affairs a
nd Health, tel. +358 295 163 641