Some doubts about the new health insurance models

System status

Questions like the above have been asked annually, and this year marks twenty years since the beginning of the reform. A beginning that has not reached its end. The results are that the state's healthcare costs are growing annually, reaching 3.81 billion leva in 2018, while patients pay approximately 50% of their own pocket for treatment. According to Eurostat data, they pay the most for medicines (65%), followed by (40%) for pre-hospital care and (15%) for hospital care. Every year there is a debate about the lack of funds, which automatically translates into a desire to increase the health contribution, without taking into account citizens who do not pay it in full or at all. This concerns civil servants, numbering 132 thousand people, people under 18, those of retirement age, police, military, magistrates and everyone whom the state must provide in full by law. 719 thousand uninsured Bulgarians can be added to this equation. By fully providing these groups with health insurance, the healthcare system could gain approximately another 1.5 billion leva.

What do they offer?

The Ministry of Health has come up with a proposal for two “new” models for health insurance. The word “new” is in quotation marks not by chance, due to the fact that the first model, proposing the demonopolization of the NHIF, has been on the table since the beginning of the reform, and the second model is discussed every year under the heading of “increasing the health contribution”. The problems with the first are that a shock change of the model from health insurance to health insurance is applied, without taking into account the differences between the two types of systems. Health insurance covers damages resulting from the occurrence of a certain type of risk, such as a serious illness or accident, as well as in the event of disability. According to the policy, the insurer pays part or all of the treatment.

The purpose of health insurance is different. It allows a person to constantly receive medical services - to go for a preventive examination, to request a consultation with a specialist, to undergo tests if the doctor has assessed that they need them. Nowhere in the world does a completely demonopolized health system exist. Analogies with the Netherlands are wrong, because even there there is mandatory, basic, state health insurance. The main problem with this model concerns the lack of clear rules in the system to introduce mandatory insurance. Insurance is done on a risk basis - the first question that arises is - the price that each citizen will have to pay based on diseases that have occurred in his past and his family history. Here is the bad example from the USA, where payment for treatment is refused due to "pre-existing diseases". The second is the "stability" of the insurance market in our country and the way in which the Financial Supervision Commission regulates and informs citizens.

The problems of the second model concern the increase in the contribution. There is no argument for why more money is being poured into a system that is inefficient and does not provide equal quality and access for all patients. The described borderline of 700 leva above which the insurer will have to pay for the treatment creates a danger for patients suffering from rare diseases, whose treatment is often 10 times more expensive. The second problem is the mandatory health insurance, which has a state-imposed and fixed premium. This means that regardless of the risks and illnesses of the patients - each insurer will have to cover expensive treatment with the centrally limited resources at its disposal. The third problem again concerns the state and the groups it provides. Since they are not currently insured at the full rate, what is the guarantee that the Ministry of Finance will also pay for the mandatory health insurance for them?

What are reasonable models?

History remembers 1

Before there was even talk of new health models, back in 2011, the health contribution was purposefully increased from 6% to 8%. These 2% were to be a reserve that would be redistributed to health insurers and thus create a second mandatory insurance pillar in healthcare. The purpose of this pillar was a pilot project for the gradual demonopolization of the NHIF and a smooth transition to a health insurance model. As a third model, the gradual demonopolization would allow the necessary adjustments to be made in the system. A similar model exists in the best health system in Europe – that of the Netherlands, and also in the best in the world – that of Singapore.

History Remembers 2

In 2015, a proposal was made to divide health insurance into a basic and an additional package. Its aim was to provide a basic, basic, gold standard, based on which each of the health insured persons would receive treatment of equal quality and price. The additional package aimed to satisfy the demand of certain groups for more expensive, “luxurious” and innovative procedures and medications, outside the basic package.

What are the first steps? For a system to be stable, the foundation on which it is built should be made of concrete, not clay, as is currently observed. There are several urgent reforms, the implementation of which would allow for the optimization of costs and the increase of the efficiency of the health system. In hospital and pre-hospital care - the valuation of medical work is the first step towards more transparency in the system, as its goal is to provide price signals to medical professionals, as well as to consumers. The second step, based on the above, is the revaluing of clinical pathways, where there is currently overfunding for some and a lack of it for others. Here a direct correlation can also be made with the lack of staff for certain specialties (e.g. anesthesiology) and the oversupply for others (e.g. cardiology). Creating incentives for price transparency of services in hospital and outpatient care would create real competition between players, as well as enable patients to choose the most cost-effective treatment based on their needs, before they even step foot in a medical facility.

In the area of medicines, it is necessary to optimize the budget, as this is the unit in which overspending is already evident in the first six months. Implementing a rational drug progeneric policy, following the example of Western European countries, could lead to savings for the budget, which would be reflected in an increase in the reimbursement rate for medicines for socially significant diseases. The highest co-payment rate (about 70%) is precisely for medicines for the treatment of cardiovascular and cerebrovascular diseases, in which we are in first place in Europe in terms of morbidity and mortality. According to data from the National Health Insurance Fund, about 30% of the budget for medicines is used to treat 70% of patients (those suffering from socially significant diseases), and the other 70% is redistributed to 30% of patients (those suffering from rare diseases).

In order to ensure equal treatment of health-insured persons, dividing the budget into generic and generic medicines would allow the funds for treatment to go to their direct beneficiaries. The long-term strategy in the health sector should be based on a sufficient amount of properly collected and processed data. That is why one of the key things to complete is the introduction of the National Health Information System (NHIS). Metaphorically, it can be said that it represents the neural network through which information is collected, compiled, processed and sent. The introduction of the NHIS would allow real-time monitoring of problems and abuses in hospital and outpatient care, as well as in drug demand and supply.

Currently, the healthcare system is a financial colossus on feet of clay, in order to prevent it from collapsing, the necessary reforms in hospital, pre-hospital and pharmaceutical care need to be implemented. Switching to new financial models without plugging the holes in the system would be like putting out a fire with a can of gasoline.

The article was originally published by "Manager" magazine.