Minister: Health insurance funds should not cover children’s medical expenses. news

It’s no surprise that health care funding is falling short. This will peak in 2025 when the Health Insurance Fund is projected to suffer losses of €150–170 million. The coalition agreement tasks the health minister with proposing ways to fix the system by the end of the year. Do you have that solution?

Allow me to start by talking about how we got here. We have clearly given priority to three areas over the last 32 years. They are national defence, culture and education. We have invested relatively more in those areas, which have received considerable public support. After all no one else will finance Estonian culture or education.

But when it comes to social welfare, we lag behind in the EU. For example, our health care funding is 20 percent below the EU average. This explains our long treatment queues and the slow pace of introducing new medicines and services. The gap between people’s expectations and reality is widening, while the relative importance of older people in society is increasing and working patterns have changed. There are more businesses, and while the general level of income is increasing, this increase is not reaching healthcare through social tax receipts.

What’s more, while health insurance funds have been given new functions in recent years, they have not always been accompanied by the necessary surge in funding. For example, the fund is now in charge of the appointment of family doctors, nicotine addiction prevention and many other new things. The recent decision concerned moving prison health services into the administrative domain of the Fund.

All this will require more money in the coming years, which no one will compensate. /…/This means the Fund’s deficit will reach close to €170 million in 2025.

Objectively, health care needs more money, while securing sustainable funding is important. Whether to adopt a new medicine or not should not be a political decision. We should not wait for the results of the (state budget strategy) negotiations to know whether the health care budget will decline. Every autumn the Latvian government decides how much money it will have for health care. I don’t believe this is the way.

Analysts proposed paying for children’s medical expenses directly from the state budget in the spring to free up a lot of Health Insurance Fund resources. This is the model currently used for unemployed pensioners. That would be the preferred solution.

And that would free up €200 million and solve the Fund’s funding problems for a decade?

The funds released will bridge the deficit and ensure development. For example, shorter treatment queues and investment in digital solutions. The Fund has completed an analysis to look for efficiencies, which should not be impossible with a budget of €2.2 billion. For example, it is possible to switch to an outcomes-based funding model and change the way at-risk patients enter the system. However, this requires many health experts to change the way they work, which requires financial motivation. We estimate that the fund could save 1 percent by operating more effectively.

Based on your analysis, taking children’s health expenditure out of the fund and instead finding the money in the central government budget is the way forward?

In fact, permanent changes are an option with respect to minors’ medical expenses. The second task is to take the inefficiencies of benefits and care allowances out of the fund’s budget. These things are not actually related to health care and may be a concern of the Unemployment Insurance Fund. /…/ But from the administrative point of view, it is easy to move the medical expenses of children from one balance to another.

Let us assume that the health insurance fund will be exempt from paying for sick days. Who will pick up the tab in his place? This is equivalent to moving money from one pocket to another. What is the difference?

Absolutely. Excluding sickness benefits from the health insurance fund would have half the impact on children’s medical expenses. But sickness benefits are linked to people’s income, and income levels keep rising. Disability to work benefit expenditure has increased by €150 over the past nine years.

That is why the government needs to decide whether to start working on the amendments required for the next State Budget Strategy (RES) to consider the reform. We clearly have huge deficits while we cannot add hundreds of crores to the system without asking what it will buy. Long wait times are the biggest problem today, and additional funding is needed to reduce it.

Knowing your majority coalition partner (referring to the Reform Party – ed.), they will ask you to find money in the system. The view from Tallin raises the question whether maintaining Väuru and Põlva hospitals, which are only 20 kilometers apart, is a wise use of money? While brutal and unpopular, restructuring can help free up resources.

It has been our good fortune that European taxpayers have helped us pay for hospital reconstruction and new health centres, not to mention (major hospitals) North Estonia Medical Center (PERH) and Tartu University Hospital. All have been funded with EU help. In the coming decades we will have to find the money ourselves.

Construction and buildings are one thing, while hospitals employ people who need to be paid salaries and use extremely expensive equipment. We know that Tallin and Tartu doctors often commute to work in those smaller hospitals. Wouldn’t it be cheaper to consolidate hospitals in a few major centres?

Dialing back county hospitals won’t find the money that’s missing. Part of our efficiency plan relates to the movement of patients, how they move between hospitals and service providers. While a more serious restructuring of county hospitals might have been possible before the pandemic, the crisis showed that just two or three major hospitals would do us no good.

I haven’t received any answers as to who will pay the children’s medical bills or illness benefits? Will the Ministry of Social Affairs apply for an additional few hundred million?

Yes, tax revenue is increasing from one year to the next, and it is up to the government and Parliament to decide how to use it. ,

And considering the recent priorities, the focus should be shifted to healthcare and social welfare. We are also discussing tax changes and cost cuts for the next four years. It should be done by the first quarter of next year to tie all this together for the 2025 budget negotiations.

It is very difficult for any minister to give a final answer regarding his administrative area. Discussion will be very difficult. But at least we would have timed these discussions in such a way that changes as per political will are possible. We also have to make choices based on certain values, such as medical insurance. We cannot ask people with health issues to pay for it out of their own pockets. It is more beneficial to society to pay to keep people healthy than to give them benefits later (inability to work).

You will be taking your argument to the government, where you will probably be told, as we have seen with respect to teachers’ salaries, that there is no money unless you find it inside the system. The Prime Minister and his party have been very firm on those terms. What will you do?

We will not take any immediate funding decisions. We will discuss the scenarios or options that the Ministry of Social Affairs and the Ministry of Finance have put together. That’s what we’ll be doing for the rest of the year.

I assume your priority would be to get more money for the system and from the central government to pay for the medical expenses of children?

I would actually reflect the solution currently in place for unemployed pensioners. I believe society will find this acceptable. All children in Estonia have medical insurance and their health concerns should not be ignored. Let us give priority to the medical needs of children over mere words.

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