In recent years, there has been a lot of attention in the media on the role of managers at care institutions. This has been prompted, for example, by the abuses at Meavita, the IJsselmeer hospitals and, more recently, Careyn. This calls for a closer look at what is expected of managers and supervisors of a healthcare institution. In this blog, I will discuss the role of the directors. I will discuss supervision in a subsequent blog.

Directors in the healthcare sector are subject to a wide range of (statutory) rules that must be taken into account in the context of good governance. These are included in general, but also in sector-specific regulations. The most important 7 are the following.

1. General standard

The general standard for the performance of duties by directors of private-law legal entities1 (including foundations) is set out in Book 2 of the Dutch Civil Code: directors must perform their duties properly and each of them is responsible for the general course of events. If they fail to do so and there is improper management, the main rule is that each director is liable for the whole. Book 2 also stipulates that the board must render account of the company's financial policy in the annual accounts.

2. Health Care Sector Governance Code

Another important source is the Zorgbrede Governance Code 2017. This code is not law, but it does contain 7 'principles' that the members of the five affiliated sector organisations (ActiZ, GGZ Nederland, NFU, NVZ and VGN) must comply with. Non-member healthcare institutions can also use the code as a guideline. What is new compared to previous care codes is that the code is no longer rule-based, but principle-based. In other words, the code primarily focuses on self-regulation and the personal responsibility of managers.

3. Admission, good governance

The Act on Admission of Care Institutions (Wtzi). Based on this Act, the "official" admission of institutions that want to offer care on the basis of the Healthcare Insurance Act (Zvw) or Long-Term Care Act (Wlz) is regulated. The Wtzi also contains rules on good governance. Examples are the distribution of different types of care, a transparent management structure and the requirement of orderly and verifiable business operations. It also regulates the possibility for these institutions to distribute profits and the right of the client council to conduct an inquiry on the basis of the associated Wtzi Implementation Decree ( see point 4 below).

4. (Rights of the) Client Council

The Client Participation in Health Care Act (Wmcz). The management of a number of types of care institutions is obliged to set up a client council, for example the general and psychiatric hospitals, the GGZ institutions and care and nursing homes. The client council is there to represent the collective interests of the clients. The client council has a number of important rights. For example, the council has the right to all information from the board that it requires for the performance of its tasks (right to information), the right to consult regularly with the board on the institution's policy (right to consultation) and the right to advise the board, on request or otherwise, on a number of subjects that are important to clients (right to advice). In addition, the client council may nominate at least one person for appointment to the management or the supervisory board (right of binding nomination). Finally, the client council has the right of inquiry. This means that the council can submit a request to the Enterprise Section of the Amsterdam Court of Appeal to have an investigation conducted into possible mismanagement within the institution. If necessary, the Enterprise Section can take measures, such as suspending or dismissing a board member.

5. External supervision

The Healthcare (Market Regulation) Act (Wmg). Please note that the Dutch Healthcare Authority (NZa) supervises the healthcare markets. For example, the NZa actively monitors that the care is provided lawfully (i.e. in accordance with the Zvw and Wlz) and that it is registered and declared correctly.

6. Ensuring quality; complaint handling

The Healthcare (Quality Complaints and Disputes) Act (Wkkgz). It regulates what good care means exactly, such as that it must be safe, effective, efficient and client-oriented and must be tailored to the needs of the patient, but also how complaints about healthcare providers must be handled.

7. Standardisation of top incomes

Last but not least, perhaps less intertwined with the performance of the management board, but not unimportant, is the Act on Standardisation of Top Incomes ( Wnt), under which the maximum income of top officials in the (semi-)public sector is set at the same level as the 'balkenendenorm' (as of 1 January 2017: € 181,000).

Bill on Management and Supervision of Legal Persons

What is still to come? The bill on Management and Supervision of Legal Persons is currently being debated by the Lower House of Parliament. This bill aims to supplement and clarify the legislation on management and supervision for all legal persons under private law. However, it mainly means a change for the association, cooperative, mutual insurance association and the foundation, and therefore also for many private healthcare institutions. As this bill becomes more definitive, we will inform you further in one of our blogs.

Finally

It is advisable for every manager of a healthcare institution to go through the above, but what this means for your healthcare institution remains a tailor-made matter. Do you therefore have questions about this or do you need advice about something that is happening in your care institution? Please feel free to contact us. The care team of Kempenaer Advocaten has the knowledge and skills to advise you.

¹ The public and private limited liability companies, associations, foundations, cooperatives and mutual societies