Health Systems in Transition - Hungary - World Health Organization ...

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Health systems in transition Hungary
the GDP in Hungary and other transition countries than in the EU15 countries,
the difference in health spending as a share of GDP between them is probably
greater than shown in Fig. 3.3 (Schneider & Klinglmair, 2004).
The central government has been in a position to control HIF expenditure
directly and, despite the predominance of local government in the ownership of
health care providers, to control investments through conditional and matching
capital grants (that is, earmarked and target subsidies).
As far as HIF expenditure is concerned, it was controlled initially directly
by the National Assembly, but starting in 1996 the central government
incrementally strengthened its control over the NHIFA, ultimately introducing
full organizational control in 1998. The SHI system has been transformed in
a way that allows the central government to contain the costs of most services.
Since the mid-1990s, sub-budgets are assigned to the various services within
the HIF (Tables 3.2 and 3.3). These sub-budgets are capped for curative and
preventive services, and the corresponding provider payment methods ensure
that the predetermined budget ceilings are not exceeded (see also section 2.8.1).
As a result, public expenditure on health decreased (Table 3.1) and could be
stabilized at a relatively low level.
Containing costs – in and of itself – does not ensure that resources will
be allocated efficiently within the health sector. For instance, if patients are
hospitalized for a disease that could have been managed effectively in an
outpatient or primary care setting, resources are wasted. Although it is difficult
to assess this kind of inefficiency based on aggregate spending data, the
structure of HIF expenditure can be used as a crude proxy. Table 3.3 shows that
the allocation of financial resources in Hungary has not changed significantly
since 1995.
HIF expenditure growth for drugs, medical aids and prostheses proved to
be hard to contain until 2007, when a strict cost-containment approach was
applied for these HIF sub-budgets as well (see also section 6.1.2). Previously,
rising pharmaceutical expenditure – attributable to the rapid liberalization of
the pharmaceutical industry and the privatization of most state drug companies
– had stymied successive governments, with overspending in the pharmaceutical
sub-budget representing a major issue.
The first measures directed at containing pharmaceutical expenditure
included shifting costs to patients by increasing co-payments, and decreasing
the scope of subsidized pharmaceuticals. They contributed essentially to the
significant increase of private expenditure on health while public expenditure