news 22 Dec 16

Montenegro Urged to Radically Change Healthcare Funding

After the financing of the public health system almost collapsed this spring, a new model of funding it with money from taxes on tobacco and alcohol has been proposed.

Dusica Tomovic
BIRN
Podgorica
 
 Patients queue for hours to schedule a doctor's appointment. Photo: BIRN.

Montenegro’s Health Insurance Fund says the public health system needs to find a new financial model to overcome its current crisis and provide care to thousands of people struggling to access basic care.

The Fund, the state institution in charge among other things of the procurement of drugs and medical equipment for public healthcare facilities, has proposed a program to rehabilitate the health system's finance and overcome a chronic lack of money.

According to the document, which BIRN has seen, money from excise taxes on tobacco and alcohol, premiums for compulsory car insurance and tourist taxes could be shifted into the health system budget.

The proposal will soon be submitted to the government and, if approved, would radically change the health system's finances.

For decades, public health has been financed from the state budget through the Fund through contributions paid by all employees on gross earnings. But ever since the Nineties, the model has revealed serious shortcomings.

Data from the State Audit Administration, published in March, showed that the debts owed by the Fund and public health institutions topped 50 million euros in 2015.

"All this [new funding program] is necessary to maintain the existing expert staff in the public system and recruit new ones and cut the costs of sending patients outside the country," the document said.

The Fund said that if the public health system cannot count on part of the revenues from excise taxes on tobacco, cigarettes and alcohol, a new excise tax should be imposed on those harmful products.

In April, the healthcare system was hit with the worst-ever financial crisis and the state could not afford to buy basic supplies and equipment to ensure public hospitals worked properly.

Routine medical examination became difficult to schedule because public hospitals faced a severe lack of important drugs, basic medical supplies and equipment.

Under growing pressure from the media and patients’ rights’ organisations, the Health Insurance Fund admitted in April that it could not launch a tender for the procurement of basic medical supplies because the state had allocated only 5 million euro for all public hospitals for 2016 - far less than what was needed that year.

The Fund said then that "the health system could soon find it has collapsed" and warned that it would not be able to solve the problem without assistance from state institutions, as there has been a discrepancy between the planned purchases of medical supplies and the money available to buy them in 2016.

According to the latest Euro Consumer index, published by Swedish NGO Health Consumer Powerhouse in January, Montenegro has "the most backward health system in Europe" and allocates only 5 per cent of its budget to healthcare. The European average is 8 to 12 per cent.

The Euro Consumer index ranks healthcare systems in Europe according to 48 indicators, including patients’ rights, accessibility, prevention and outcomes.

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