The policy brief was prepared by: Levan Avalishvili, Goga Tushurashvili and Alexander Kevkhishvili
The Georgian State Universal Healthcare Program was launched in 2013 and is run by the Social Service Agency. The program was aimed at providing health insurance to all citizens of Georgia who, as of July 1, 2013, had neither state nor private insurance. All pre-existing state insurance programs were run by private insurance companies. These programs provided health insurance only to socially vulnerable and retired citizens, children under 5, students, children with disabilities, and persons with significant disabilities.
In 2014, all of the pre-existing state health insurance programs were terminated and their beneficiaries were transferred to the Universal Healthcare Program, after which private insurance companies were no longer involved in state programs. The Universal Healthcare Program provided the citizens of Georgia with important social guarantees. However, the scale of this program gave rise to risks in the following areas: growing budget expenditure; effective management of the program and development of private insurance business.
This policy brief aims to study the challenges faced by the Universal Healthcare Program, and develop recommendations on how to overcome them, as well as how to ensure the program is implemented in an efficient and uninterrupted manner.
Now, nearly three years after the launch of the Universal Healthcare Program, its financial performance has made clear that the planning process did not involve careful consideration of possible risks. The program did not have a strategy or an action plan that would ensure its effective and coherent development. Maintaining the program in its current form is associated with a number of risks:
The increasing cost of the Universal Healthcare Program could result in the government no longer being able to allocate the funds required for its uninterrupted implementation and timely compensation of medical institutions. For example, in 2014 the State Audit Office found cases of overdue payments to medical institutions by the Ministry of Health. IDFI also requested information on this matter from the Social Service Agency, which denied the existence of any overdue payments.
Also, a risk factor is the fact that according to Georgian law the SSA is unable to access information on citizens that are insured by private companies. This greatly complicates the process of identifying beneficiaries for the state program.
The lack of a long-term development plan for healthcare programs is a significant threat to the development of the private insurance market. State programs greatly influence how private insurance companies plan their activities. Therefore, the inexistence of a state program implementation plan creates an unstable environment for private companies and hinders the development of the private insurance market.
Considering the challenges facing the Universal Healthcare Program, the Georgian government will most probably have to make some modifications in the near future. The Prime Minister has already alluded to this by stating that the program would probably be modified after the 2016 parliamentary elections.
IDFI believes that the following recommendations need to be taken into account in order to increase the effectiveness of the program:
1) A strategy and a long-term action plan for the Universal Healthcare Program need to be developed. A long-term vision of the development of the program will increase the stability of the program as well as the private insurance sector.
2) The government should consider modifying the program into a targeted one, where priority will be given to socially vulnerable persons, persons with disabilities, large families, retired citizens, young children and low income citizens. The program development strategy and action plan should detail the different stages of this modification.
3) Considering international best practice, the universal healthcare strategy should include the introduction of an obligatory health insurance system through a public-private partnership format.
4) The monitoring system of public funds allocated for the program should be improved, in order to minimize the likelihood of dishonest behavior of medical institutions.
5) The Law on Personal Data Protection should be amended to enable the government to have access to information on citizens who are insured by private insurance companies.
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