Health reform process in Slovakia EMK workshop Budapest, 3.6.2003 Rudolf Zajac Minister of Health Peter Pažitný Advisor to the Minister of Health

Content Fiscal position of Health sector Basic data about Slovakia The current system Where is the beginning of the circle? Stabilisation measures System measures Network measures

I. Fiscal position of Health Sector

Gap is widening (Cumulative real growth of GDP, 1990=100) USA EU 15 SR

Deficit of Public Finances (% of GDP)

Fiscal position of Health sector (% of GDP) Expenditures Resources Deficit

Coverage of the Deficit (% from GDP)

… growing debts (in bln. Sk) Annual change 2002 … 2003 VAT and deregulation … 1,0 Providers: 16,2 … 22,0 Health insurance funds: 13,2 … 15,4

Structure of the external debt (SKK billion) Pharmacies (7,0) HIF Without Perspektiva (2,2) Without Redistrib. Fund (3,8) Contributors Unpaid insurance (11,0) Fines, Penalties (8,5) Public finances (2,2) Primary and secondary care (1,3) Drugs (4,5) Inpatient facilities Public finances (4,1) Energy (2,9) Others (4,6)

Receivables after maturity Maturity dates Annual expenditures SKK billion Receivables after maturity Maturity dates in days Public pharmacies 20,2 7,0 120 - 150 Hospital pharmacies 5,1 4,5 220 - 270 Energy suppliers 1,3 2,9 500 - 700

How much is that? (SKK billion) Annual health budget in 2002: SKK 68 billion GDP in 2002: SKK 1062 billion Pharmacies (7,0) Public finances (2,2) Primary and secondary care (1,3) 26,6 Drugs (4,5) Public finances (4,1) 40,0% 2,5% Energy (2,9) Others (4,6)

II. Basic data about Slovakia

Life expectancy at birth Source: WHO, 2000

Hospital beds, # per 100 000 Source: WHO, 2000

Physicians Source: WHO, 2000

Length of stay Source: WHO, 2000

In-patient care admissions Source: WHO, 2000

Bed occupancy rate Source: WHO, 2000

Outpatient contacts Source: WHO, 2000

III. The current system

Financing Annual payment Contributions Taxes Citizens

Structure of sources, %

High correlation with real economy A change in salaries by 1 per cent causes a change in resources by 1.14 percent But in employment it causes a change by as much as 1.24 percent.

Payment mechanisms Date of change POC SOC in-patient facilities 1 Jan 1993 capitation fee for service bedday according to specialization and types 1 Apr 1993 universal point system 1 May 1994   "hotel and point flat rate" 1 July 1994 bedday according to types 1 Sept 1994 1 Apr 1995 combined system 1 Apr 1997 1 Dec 1998 budgets 1 Jan 1999 capped fee for service interventions with upper limit 1 May 1999 "prospective budget" 1 June 2000 age criteria of capitation "maximum prices" 1 Jan 2002 capitation + fee for service (for prevention) "orders for interventions"

Organization: Privatization

IV. Where is the Beginning of the Circle?

Challenges and Reactions of the Reform Growing expectations of the citizens Increasing Costs Limited ability to pay Decreasing of expectations of the citizens Increasing of efficiency Mobilisation of Resources

Position of Political Decisions How much Resources ? Decreasing of high expectations of the citizens Efficiency How wide Treatment Act?

Where is the Beginning of the Circle? Health Care Act Treatment Act New Insurance Act CONSTITUTION Health Insurance Act New Treatment Act Health Care Surveillance Authority Act Chambers Act Health Care Occupations Act Health Care Providers Act

Schedule of reform steps Network measures New system System measures Stabilisation measures 2002 2003 2004

V. Stabilisation measures

Goals Stopping the growth of debts Financial stabilisation of system

Stabilisaton measures Modern definition of the Health Care Introduction of marginal co-payments for Providers New initiatives in Drug Policy

1. Modern definition of the Health Care Related services: Transport Food Accomodation

2. Application of marginal co-payments for Providers Health Insurance Fund Provider (pharmacy) Primary care 20 Sk 0 Sk Secondary care Accomodation and food in inpatient care 50 Sk Transport 2 Sk/km Prescription fee 15 Sk 5 Sk

2. Vulnerable groups freed from co-payments People in material need Inconscious people People in health status, that doesnt allow the permission of agreement Mother with children (6 year) Blood donors Psychiatric patients Long-term ill patients