Health bosses scramble to reduce damage over planned savings

Leaked recovery plan for public health insurer prompts Fico to intervene.

Health Minister Tomáš Drucker (l) and PM Robert Fico (r)Health Minister Tomáš Drucker (l) and PM Robert Fico (r) (Source: SME)

Insured patients with tattoos would have to pay for hepatitis C treatment, and people with macular degeneration would only receive treatment if their eyesight were seriously reduced.

These were among the possible outcomes of a recovery plan for the state-run health insurer Všeobecná Zdravotná Poisťovňa (VšZP) leaked in late February which brought criticism of Health Minister Tomáš Drucker. In response, Prime Minister Robert Fico rapidly went on TV and radio to assure people that he would “resolutely intervene” against any such measures.

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“No part of the recovery plan includes measures directed towards saving on patients,” Minister Drucker said following a February 28 meeting with the prime minister, as quoted by the TASR newswire. The recovery plan is intended to redistribute resources wherever it makes sense, but there is no room for savings at the expense of patients, he stressed. The actual plan, released by the non-governmental think tank INEKO, suggests that VšZP wants to save on medicaments, medical devices and reimbursement of health care costs. The savings are supposed to amount to over €115 million.

Read also: State health insurer reports huge losses Read more 

The recovery plan for the state-run health insurer is part of Drucker’s efforts to improve the situation in health care, which is recognised to be one of the most problematic areas of public spending due to a number of factors, among them hospital debts and the high rate of perceived corruption. The fact that VšZP finished last year with an estimated loss of €250 million has added to the sector’s problems.

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Controversial saving plans leaked and then denied

The ministry, VšZP and the Health Care Surveillance Authority (ÚDZS), which approved the recovery plan, had remained silent about the proposed measures. Partial information leaked in the media, provoking concerns among the opposition and the general public.

One reported measure was that VšZP is planning to cut reimbursement of the cost of hepatitis C treatment for people with piercings or tattoos, as well as for alcoholics and drug users. Another related to treatment for people with age-related macular degeneration. Special anti-VGF injections that can prevent complete loss of eyesight can cost up to €770 each. The insurer, according to media reports, proposed to fund such treatment only for patients whose eyesight had already degenerated.

At the end of February, the prime minister intervened, announcing that he would talk to the health minister. But by that time the minister himself was already making public assurances that there would be no cuts in treatments.

On March 1, VšZP ruled out limits on treatment of macular degeneration and hepatitis C. Its head, Miroslav Kočan, told a press conference held on the same day that the measures were never part of the recovery plan.

“VšZP denies speculation about possible limits in access to health care that unfortunately emerged based on wrong interpretation of the proposals submitted to the Categorisation Commission,” VšZP spokesperson Petra Balážová wrote in a statement.

Fico undermines Drucker?

When Drucker agreed to join the current government as a nominee of Fico’s Smer party, he was presented as non-partisan and a crisis manager, The prime minister declared that Drucker would have “a free hand” to take measures in the department. After the elections, the post of health minister took the longest to fill, as health was perceived by observers as the most troubled sector, one in which unpopular measures might be needed and where improvement would not come fast.

But in the wake of this latest crisis – less than a year after the elections – Fico now says he will “resolutely intervene” against any moves by VšZP to limit treatment. This means that the minister no longer has a free hand in his own department, and that VšZP is also operating under limits set by the prime minister, observers agree.

“He [Fico] tried to look like the person who saves the day,” political analyst Grigorij Mesežnikov told the Sme daily.

Impact on medicaments and examinations

The INEKO think tank meanwhile released a full copy of the original VšZP recovery plan.

Despite claims about greater transparency and more effective public control, INEKO had not been able to find the recovery plan on the websites of VšZP or the ÚDZS, so it asked for it via the law on free access to information. The think tank received the plan from the latter, but VšZP refused to hand it over, INEKO analyst Dušan Zachar wrote in a blog post.

The plan indicates that the insurer intends to save money on medicaments, medical devices and reimbursement of health-care costs. The austerity measures are slated to save at least €115 million, according to the VšZP calculations, with the highest sum being saved in the area of purchasing health care.

Under the plan, VšZP plans to reduce spending on health care by 3 percent compared to the previous year. To achieve this, it proposes not to realise some agreements through which it also reimbursed so-called over-limit payments, TASR reported.

Read also: State health insurer terminates contracts with specialists to cut costs Read more 

It also plans to extend the central purchase of medicaments and adopt measures concerning non-categorised medicaments, which should make it harder to access medicine not normally reimbursed from public health insurance, but for which there are exceptions. This would negatively impact mostly patients with rare diseases, Sme wrote.

Other measures concern the prescription of medicaments and the introduction of e-prescriptions, as well as reducing the price of specialised medical materials and termination of agreements with about 100 outpatient departments whose doctors also work at hospitals. The insurer also plans to reduce reimbursement for CT and MR examinations and dialysis treatment, TASR reported.

More money is to be saved on debt claims on unpaid insurance and reduction of operating costs.

Plan not ambitious enough, says INEKO

INEKO’s Zachar considers the plan to be insufficiently ambitions, warning that it will be paid for from patients’ money.

“What surprised us the most is the fact that despite big financial problems, the current leadership of the insurer chose a not-very-quick tempo recovery process, which does not lead through a thorny path and even contains resting posts with pillows, where the state should provide financial infusions,” Zachar added, suggesting that the financial help could be considered “unauthorised doping”.

The analyst criticised the fact that the plan’s authors suggest the insurer will return to black numbers only in 2019. Moreover, they ask the state for additional money amounting to €150 million, claiming the sum is necessary to secure the insurer’s solvency.

Zachar says it is possible to help the insurer without state money, citing as an example the situation from the Iveta Radičová government (2010-2012). Under the leadership of Marian Faktor, VšZP adopted austerity measures and returned to the black after only one year.

Moreover, it is striking that the plan does not suggest increasing the insurer’s incomes. Currently, the collection rate of VšZP is the lowest among the three health insurers in Slovakia, at just over 96 percent.

“Even a relatively small increase in the collection rate may bring the insurer useful additional funds,” Zachar wrote in his blog post.

He also compared the current recovery plan with recommendations by analysts at the Institute of Financial Policy (IFP), which is part of the Finance Ministry, as part of the Value for Money initiative. The measures were prepared before the poor financial situation of the insurer was reported, but were much more ambitious than the current recovery plan, according to Zachar.

Though the less ambitious goals should create an easier way for VšZP managers to fulfil the recovery plan and avoid compulsory administration, they increase the need for the insurer to receive aid from external sources. As a result, the insurer will be more likely to ask the state for help, the analyst claimed, warning that this would mean taxpayers would fund it.

“Until the austerity measures of VšZP achieve their maximal potential, no state aid to the insurer should be considered,” Zachar wrote. “Too quick and high state aid would send a negative signal for the future that bad management and no savings are allowed in state health care.”

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