Mandatory Health Insurance Is a Necessity for Armenia

Marianna Koshkakaryan, MD., MPH

- How do you assess the state of healthcare in the country? Can you, please, describe the recent achievements of healthcare in the country? How effective is communication and collaboration with the medical organizations of other countries and the WHO?

Armenia has made significant achievements in terms of reforming and developing the healthcare system since the late 1990s. In particular, significant institutional and structural reforms were carried out during these years. The most important of them is the development of family medicine in Armenia, which ensuresalmost 100% coverage of population to be covered by practices of re-qualifiedphysiciansunder the family medicine scheme , which is especially actual for rural communities. The population has also been granted the freedom of choosing  primary healthcare doctors, in other words open enrollment system allows for free choice of providers in contrast to the previous system based on the catchment area. A large number of out-patient clinics (rural ambulatories, health centers) in rural communities were renovated and upgraded during these years. As part of the program for themodernization of hospitalsin the country, a whole range of hospitals and medical centers, both in Yerevan and in marzes, were fully renovated/reconstructed. The only regional center for bone marrow transplantation and stem cell laboratory were established in Yerevan. Financing of Armenia’s health care system was alsoreformed by changing providerpayment mechanisms and establishment of the State Health Agency, responsible for contracting health care providers and paying them based on the volume of work performed. . Since 1997, Basic Benefit Package has been introduced, which makes it possible to provide free medical services to the population in the frames of the state order.

Due to changes made over the past year the scope of this package has been expanded. In particular, currently it includes oncological treatment services, surgical treatment of acute ischemic stroke, more effective methods of treatment of acute cases of myocardial infarction with the use of special drug-eluting stents. The package also includes medical services forchildren from 7 to 18 years old. An air ambulance service was created, which allows quick evacuationof affected people into hospital. The salary of polyclinicdoctorshas been increased by almost 30%.

Nevertheless, regardless of all these reforms the system still has some disadvantages and challenges, first of all, related to the quality,availability and accessibility of healthcare services. Hospital care dominates national health spending, absorbing 42.3% of the budget. This suggests that the larger part of the population prefers to go immediately to the hospital, bypassing primary healthcare level - polyclinics. The reasons here are many, including mentality. Our citizens, for some reason, are convinced that free healthcare cannot be quality by definition. We apply to a doctor only when the situation has already become critical, whereas there might bepreventivemeasures to be undertakenwhich is much more cost-effective than treatment. Many citizens do not even know about  free medical examinations and other services provided at primary healthcare facilities. That is to say, we also face the problem of lack of awareness of the population.

Total health expenditures account for about 10% of the republic's GDP, while the public funding is among the lowest in the world, contributing to 1.5% of the GDP. Thus, the main burden is shouldered by the population. Today out-of-pocket payments faced by the population contributes to 83.4%. As for cooperation, it should be noted that Armenia actively cooperates with organizations such as the World Bank, UNICEF, WHO, USAID, Asian Development Bank, and so on. All these organizations are investing in the development of medicine in our country. Cooperation with the Diaspora is very important to us, too, as it has traditionally, stood ready to support reforms in the healthcare system of Armenia.

- Which segments of the population use free medical services, are these services of justifiable quality? Where do citizens most often go for treatment and mainly for what reasons?

Primary Healthcare services, the Ambulance service, and some emergencyconditions are covered by of the state order, that’s to say are completely free. In addition to that, people with first, second and third groups of disability, people from socially vulnerable groups, conscripts, parents of killed military personnel/soldiers, and some other beneficiaries including  Family Benefit Package program, also enjoy free inpatient treatment and are granted some medications. However, public funds are still insufficient, and people pay for medications and the services of hospitalsmainly from their own pockets. It is one of the reasons that many patientsleave abroad for treatment. The main directions of such treatment are oncological diseases, blood diseases, specifically onco-hematological conditions, and in rare cases organ transplantation. Our citizens mostly travel to Germany, France and Israel. People leave for the US, Russia and even neighboring Georgia for treatment. For example, postoperative treatment of oncological diseases is of higher quality in Georgia based on the new treatment schemes and affordable medicines.

- How does the lack of health insurance affect the health of the population, how can it solve the existing problems? For example, the problem of affordability of medicine for all layers of the population, the improvement of the health of the society as a whole?

The main burden of medical expenses lies on the shoulders of the population and leads to high rates of morbidity and mortality of our citizens. 93% of deaths are due to non-communicable diseases: cardiovascular diseases, oncological diseases, diabetes, chronic lung diseases, injuries, and so on. The aging of the population leads to an increase in the percentage of such diseases and, accordingly, to an increase in the financial burden on the population, if the state’s approach to this problem has been not changed. It is here that the need to introduce universal health insurance comes to the fore. And now the Governmentis at the stage of active discussions on this opportunity. The basic principle is that the social health insurance system should be based on social solidarity and justice. In other words, the rich should pay for the poor, and the healthy should pay for the sick. This is one of those few mechanisms that allows to solve the problems in the sphere. Of course, the introduction of mandatory health insurance is not easy andrequireshardefforts. Today, international organizations and experts who actively explore and present the experience of other countries, are supporting the Ministry of Health in order to form the health insurance concept. It is planned to introduce mandatoryhealth insurance in Armenia to be operational from 2021. It is possible that the state will pay for socially vulnerable and disabled . It should be noted that all these issues regardingrevenue mobilization, strategic purchasing, etc. are still under the discussion. It is also necessary to understand how we could bring outinformal workers whoseincomes are not fixed to a single field, for example, taxi drivers or citizens who are labor migrants. Thus, it is assumed that the medical services will be available to the entire population, without exception. International experience clearly supports the introduction of this system, especially when the state is unable to fully cover medical services.

- What urgent measures need to be taken to improve the healthcare system?

The need for such measures is certainly visible. And to improve the system, first of all we need to understand the causes of our problems. The main cause is the scarcity of public funds allocated to health care. In this light, government spending on health sector should be increased in any case. But just the increase in funding is not enough to resolve all the problems of the health sector. A comprehensive approach is needed, which is still not present today, even though the priorities have been set correctly. In my opinion, the primary health care - theoutpatient care/polyclinics – is one of these priorities. It is much more efficient to spend public funds on disease prevention rather than treatment. The population, in its turn, should understand the importance of prevention and not seek medical help only when they have a devastating pain somewhere in the body. According to the Center for Oncology, 54% of cases of cervical cancer detection occur in the third and fourth stages of development, when the prospects for preserving the life are very small. By the way, if detected at an early stage, cervical cancer can be stopped very easily and without any consequences. This disease is easy to detect through avery simple screening, PAP test, which is implemented in the frames of the national screening program for early detection and prevention of cervical cancer, used in all polyclinics. However, in a paradoxical manner, part of the population does not go to polyclinics for prevention.

Solving healthcare problems implies one common line of action, an interministerial approach.In other words, if we want to overcome the issues, we need a strategic approach.



30 January, 2014
Right after the New Year, the citizens of Armenia were shocked by the gas and electricity bills for December.

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