Ukraine has allocated enough money in state budget 2017 for healthcare reform, provided that it is used effectively – government, experts


The key is to change the mechanism of funding the healthcare industry and engage all stakeholders of this reform.

Kyiv, October 5, 2016. The money provided by 2017draft state budget is enough to reform the industry if used effectively. To do this, it is necessary to reform the health care system step by step because the current system makes efficient use of funds impossible. This was unanimously declared by representatives of the Ministry of Finance of Ukraine, the Ministry of Healthcare of Ukraine and civil experts at a discussion held at Ukraine Crisis Media Center.

“Without structural change of an approach, this budget will always finance our health care system on leftovers. The essence of the reform is to use the budget differently: on particular services for a particular patient,” explained Pavlo Kovtoniuk, Deputy Minister of Health of Ukraine. A full transition to the new financing model from 2017 is impossible – it is a task of budget planning for 2018 and subsequent years, noted Viktor Taran, head of the Center “Eidos”, expert of Public Finances group, Reanimation Package of Reforms (RPR). In his view, it is desirable to begin doing this in March.

The position of both the Ministry of Finance and the Ministry of Healthcare is to increase financing for those who will be the first carry out reforms, so as to stimulate the process of turning municipal owners of health facilities into real owners. “We must create rules to motivate the regions that are faster than others. The budget should encourage a reform, not preserve the existing state of affairs,” added Pavlo Kovtoniuk. “As soon as we see the first steps toward the reform, the Ministry of Finance is ready at any time to prepare more money for those communities to stimulate the reform progress,” stated Sergiy Marchenko, Deputy Minister of Finance of Ukraine.

Oleksandr Yabchanka, independent expert, RPR Medical reform group, reminded that these theses are essential not only in the context of healthcare reform, but also decentralization reform. After its implementation, the relevant ministry will determine principles of the entire system, mechanisms of governance and financing and a guaranteed volume of medical services for citizens. The normal functioning of the system on the grounds will be the responsibility of local authorities. “The role of local communities is to maintain these [medical] institutions, keep them in good condition, engage qualified doctors and ensure that people could physically get there. And the state will buy the package of guaranteed services from them,” noted Mr.  Kovtoniuk. So the task for local authorities in the near future is to take care of strategic investments in their institutions, especially – in infrastructure and energy efficiency. “In fact, this is the money that I did not see in the draft budget. If this money could be taken from somewhere in the process of launching the reform, it would be correct,” noted Mr. Yabchanka.

Pavlo Kovtoniuk informed that the primary link of medicine will switch to the principle “money follows the patient” and use of uniform clinical protocols by 2017. According to Oleksandr Yabchanka, the protocols required to run the “primary link” have already been approved. As to the secondary link, this principle is planned to be launched in 2018. It will taken three years to switch to it in full. As to such flagships of Ukrainian medicine as permanent medical institutions of the National Academy of Sciences, they should be given the administrative and financial autonomy instead of increasing the state funding. “Our analysis showed that 90% of these institutions practice paid compulsory hospitalization that amounts to UAH 1,000 – 5,000,” explained Sergiy Marchenko. The state funds comprise only 10% in their budge. So, the logical way out of the situation is to transfer them to another legal form, but to retain in the state ownership, and give them the opportunity to freely use these funds.

The effectiveness of reforms should be evaluated with the help of financial audit, i.e. the monitoring of expenditures and for which services to a specific patient, and how the doctors’ revenues will grow after these innovations. The officials and experts stressed that the key tasks for today are to consider in detail the mechanism of evaluation with clear performance indicators and to introduce a single electronic system, which will record all services rendered. The latter is particularly important given the problem of so-called “dead souls” – the patients who fictitiously assigned to a doctor. “We wish the “primary link” would immediately switch to the electronic relations with the budget as soon as we introduce this principle of funding. Only this will completely close these issues,” noted Pavlo Kovtoniuk.

One of the greatest risks to the success of the reform is its transformation into “a coin to exchange” from a political perspective. Currently, there is a consensus between the parliamentary committee and the Ministry of Healthcare. But in case of contradictions the further changes will be blocked. “Ukrainian politicians must understand that the reputational risks of failed reform are much worse for them than the reputational risks that may arise during the implementation of the reform,” emphasized Oleksandr Yabchanka. Miscommunication between the central authorities and those who directly implement the changes at the local level is an equally serious risk. “Theoretically, we can develop a very effective system, but if the key stakeholders in this process do not understand what is going on, will not succeed. Among the key stakeholders are all citizens, all healthcare workers and Ukrainian politicians,” added the expert.