Issues of health care financing
May 2003
Dr Gyula Kincses
1/14
Basic trends characterising 21st
century societies
• Extension of life, transformation of society’s age
structure;
• Harmonisation of certain diseases with life, thereby
increasing the proportion of people living with
diseases and disabilities;
• Increasing demand to improve quality of life for
people with disabilities;
• Expected leaps in the development of medicine and
medical technology (genetic engineering,
biotechnology).
2/14
Consequence of the trends
• The health care delivery system cannot be financed
in a lasting and sustainable way based on traditional
principles.
• Directions for solution:
- specification and selection of risks treated by
compulsory health insurance,
- restructuring the resources of compulsory health
insurance,
- improving self-care, preference of health saving
- specification of services and provisions.
3/14
Specification and selection of risks treated
by compulsory health insurance
• Separation of risks having outside interest:
occupational health, competitive sports
• Separation of other types of risks:
nursing insurance
• Shifting of the costs of damages caused by a third
party:
traffic accident, physical injury etc.
• Deflection of voluntary risks to supplementary
insurance:
extreme sports, dangerous animals
4/14
Restructuring the resources of compulsory
health insurance
• Elimination of health contribution (EHO), keeping the
money within the sector.
• Restructuring the rate of employer-employee
contribution.
• The principle “everyone possesses legal status based on
demonstrable contribution payment” should be
actualised.
• The principle “everyone is paid by whoever grants
livelihood” should be in force.
• The system cannot be financed by contributions tied
exclusively to wages.
• Budgetary support should be planned support rather
than planned deficit.
• Settlement of the situation of those not living on wages.
5/14
Specification of services
and provisions
• The service catalogue cannot be fully made, but
The authorisation order based on minimum
conditions is taking this direction.
Financing rules (“book of rules”) are also
suitable for specification of service package.
The “examination-therapy” procedural order is
still an existing instrument.
• This issue will come up again in this conference in
connection with innovation policy.
6/14
Improving self-care,
preference of health saving
7/14
Inequalities in the
health care system
• Considering social polarisation and the burden
weighing on underprivileged groups, the rate of
private financing is high in Hungary;
• Private financing is unevenly burdened and appears
almost exclusively as incidental cash payment;
• There are great regional inequalities in the
accessibility of the delivery system.
8/14
Health care system of different countries
from the viewpoint of the equity of financing
100
%
90
Out of
Pocket
(o.p.)
80
70
Suppl.
health ins.
60
Public
financing
50
40
D
m
en
k
ar
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y
en
ai
an tuga
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m
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er
Sw
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ia
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A
tr
us
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rg
ec land bou
e
r
G ther em
x
e
N
Lu
EU
y
d
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e
m
ar
an gi u apa anc
l
g
J
un
Ire Bel
Fr
H
1
Ita
ly
Sw
nd ada
la
r
n
e
Ca
it z
Source: M. Schneider Gesundheitssysteme im internationalen Vergleich, OECH database
.
9/14
On the basis of data between 1994 and 1998
U
SA
Restructuring the regulatory system
of the health fund
• membership fee based on 100% solidarity principle, in
place of the 40-60% mixed system for the public
services of the health fund:
assessment of health status, screening, making of
health plan
community prevention and life style programmes
organisation of services
consumer protection.
• Optional health account for members, though not only
the health fund can manage health accounts.
10/14
Definition of health account
The Health Account is a current account that is
• supported with tax benefits equal to the health funds
• at a specified account manager
financial institution
health fund
business insurer
for which reimbursement can be performed in case of
purchase at
• qualified service provider
• special professional enterprise
11/14
Services of the Health Account
• Health services in kind
obligatory share of services financed by social
insurance
voluntary supplementary fee (hotel, meal etc.) in
line with services financed by social insurance
services used at providers not financed by social
insurance
• Purchase of drugs and medical aids, other medical
technology products
• Nursing care
• Income-supplementing services following
accumulation/deposit time (in other areas of social
security, life annuity etc.).
12/14
Tax benefits of Health Account
• Health Account receives tax benefits equal to the
health funds.
• Business insurance covering mostly health care
services should also receive identical tax benefits.
• The rate of tax benefits – as health-oriented saving
– should be determined in a common platform.
• Short-term “flowing” financing and health saving
should be differentiated in tax benefits.
13/14
Stimulation of service market
• The condition for the spread of
supplementary financing is the development
of the service market.
• Consensus-based provider agglomeration
with common accreditation.
• Extension of optimal co-payment system:
- choice of doctor and institute (with the
exception of primary care)
- services without regional obligation to
provide.
14/14
15/14