The Icelandic Health Care System is a public, single-payer-system financed through national taxation. About 80-85% of the total health care expenditure is public, the rest is out-of-pocket payments from users. The Ministry of Health is one out of 12 departments of Government. This is a national health care system in which the provision of services is predominantly public. The organisation of the system has been greatly hierarchical. However, in recent years the number of private provision has been increasing and in the current budget an estimated 40%+ of the budget goes to paying services to private providers. Private providers are mostly private-non-profit providers (nursing-homes, rehabilitation, etc), whereas private-for-profit providers althougth in great minority are private practicing medical specialists providing elective surgeries and medical treatment in private clinics, diagnostic centres, primary care health care centres and a few nursing homes. The system is however best described and classified as a state centred, publicly financed national health care system with growing private provision of health care.

The main policy principles and policy goals the new goverment is committed to are the following: To sustain a world class quality health care services via state-of-the-art governance of the system in which the taxpayers, the ultimate funders of the system, and the users will be ensured equal access (geographically and economically), equity, quality, safety, cost-efficiency and effectiveness of care. The government is committed to deliver a policy of increased patient choice of services through increased diversity of service provision, and to implement a system in which the money follow the patient. A variety of payment systems will be in use, developed and implemented over the coming months and years. High standard of clinical excellence and quality of care is being ensured by the National Directorate of Health which is a public inspection agency.

The Icelandic Health Care System The main principles of the new government reforms 2008

MINISTER OF HEALTH The Ministry of Health USERS DEMAND VOTERS TAXPAYERS PROVIDERS SUPPLY SERVICES Users charges Provision of services General national taxation Payments Delegation of authority through financing health care services by national taxation – a simple illustration of the three core dimensions in the system, i.e. financing, regulation and provision.

MINISTER OF HEALTH The Ministry of Health USERS DEMAND VOTERS TAXPAYERS PROVIDERS SUPPLY SERVICES Users charges Provision of services General national taxation The current reforms involve the introduction of an internal quasi-market in health care through implementation of purchaser and provider arrangements akin to the UK reforms and the Swedish reforms in 1990s. Funds STRATEGIC COMMISSIONING AUTHORITY PARLIAMENT Decides the Government Budget by passing an annual Bill Payment systems

The new organisational plan of the Icelandic Health Care System The Ministry of Health Policy direction, policy-making and regulation Hospitals Primary care centres Private Providers Health care institutions Other Outpatient care Inspection Delegation of Authority The Icelandic medicines control Agency National Directorate of Health Strategic Purchasing Authority Public Health Agency, Radiation Protection Agency Providers