3.4 Out of pocket payments
The system of cost sharing, which has been in place since the 2002 Health Insurance Act came into force, is the result of a political compromise with providers, many of whom had long complained that the health system was underfunded. Much of the public debate about cost sharing revolved around arguments about raising revenue to increase professionals’ salaries. Arguments were also made for introducing fees to counteract “unnecessary” use of health services. For example, the Estonian Association of Family Doctors argued strongly in favour of a co-payment for office visits to reduce the number of what they considered to be unnecessary visits. However, the government was able to uphold the principle of free access to primary care outlined in the Health Insurance Act, introducing co-payments only for home visits.
OOP payments consist of statutory cost sharing for EHIF benefits, direct payments to non-contracted providers or for services and products not part of the EHIF benefits package as well as informal payments. Since the mid-1990s, OOP payments have increased steadily as a proportion of total expenditure on health care, largely through the growth of the private health sector. In 2016, OOP payments accounted for 22.7% of total health care expenditure, below the maximum limit defined in the NHP (25%). (For further analysis of their impact, please refer to section 7.2 Financial protection and equity in financing.)
In 1995 a fee of €0.30 was introduced for initial outpatient visits to public hospitals and health centres. Yet large groups such as pensioners, disabled people and children were exempted from the fee. Private specialists were allowed to set their own fees even for publicly funded services, which resulted in an increase of OOP payments. The 2002 Health Insurance Act defined co-payments that contracted providers may charge, regardless of whether these are public or private providers. The Act sets maximum limits to the co-payments and regulates its annual adjustment to the level of inflation. However, these annual adjustments were never made. This changed in 2013, when maximum co-payment levels were increased by the rate of inflation for the period 2002–2013.
The cost-sharing requirements for outpatient care are as follows: there are no co-payments for visits to a family doctor, although family doctors can charge a maximum fee of €5.00 (until 2013 the maximum limit was €3.20) for home visits (Table3.7). EHIF-contracted providers of ambulatory specialist care can charge a maximum fee of €5.00 (until 2013 the maximum limit was €3.20) but there is no fee if the patient has been referred within the same institution or to another doctor in the same specialty.
Hospitals can charge a maximum fee of €2.50 per day (until 2013 the maximum limit was €1.60) up to a maximum of 10 days per episode of illness. Exemptions are made for children, hospitalizations related to pregnancy and delivery, and for patients in intensive care. Hospitals are also allowed to charge fees for above-standard accommodation for inpatient stays. However, all patients must be offered standard accommodation and, if none is available, they cannot be charged extra for the use of above-standard accommodation. For non-contracted providers, services outside the EHIF-reimbursed service list and services not covered with EHIF contracts, the providers can set their own price. These prices should be “reasonable” but are not subjected to price caps.
Outpatient prescription pharmaceuticals are subject to a co-payment of €2.50 per prescription, plus some share of the price of the pharmaceutical. The general reimbursement rate is 50% of the pharmaceutical price (minus the co-payment). Furthermore, if the price of a prescription drug exceeds the reference price, the patient pays the difference in full. A government regulation lists pharmaceuticals for chronic illnesses that can be reimbursed at a rate of 75% or 100%. A reimbursement rate of 90% is applied to pharmaceuticals in the 75% category when these are prescribed to people aged between 4 and 16 years, those receiving disability or old age pensions, or individuals over 63 years of age. Full (100%) reimbursement of pharmaceuticals is applicable for children younger than 4 years of age, but they are still subject to the €2.50 co-payment per prescription. However, if the pharmaceuticals listed in the higher reimbursement categories are used for diseases other than those noted in the regulation, the general 50% reimbursement rate applies. In 2012 the caps on pharmaceuticals with a 50% reimbursement rate were abolished, because in the previous year price agreements for this group of pharmaceuticals led to effective price control.
Starting from 2018, the additional reimbursement of costs of prescription pharmaceuticals changed. If an individual’s total expenditure on prescription drugs in a year is more than €100, the EHIF compensates 50% of the OOP cost and for expenditure above €300, it compensates 90%. The co-payment (€2.50) is also included in the individual annual cap. The calculation and administration are automatic and take place at the moment of purchase (see also section 6.1 Analysis of recent reforms).
A new dental care benefit package includes the most essential dental services and, from mid-2017, covers all adults. For adults, a 50% co-insurance was implemented, with a €40 per year maximum reimbursement. Persons over 63 years of age, pregnant women, mothers of children up to 1 year of age, persons with a greater need for dental treatment because of a particular condition (such as diabetes) and persons eligible for a work incapacity pension or an old age pension received dental benefits, with a 15% co-insurance and a maximum reimbursement of €85 per year.
For some services, such as inpatient nursing care, medical devices and abortion, co-insurance rates apply. See Table3.7 for more information.
Cost-sharing rules apply to all EHIF-contracted providers regardless of legal status. The Health Insurance Act notes that co-insurance rates cannot exceed 50% of the listed price of a service and have to be equal for all insured individuals. Certain criteria need to be fulfilled in order to consider co-insurance for non-pharmaceutical services, including: co-insurance can only be requested if the goal of the service can be achieved by alternative, cheaper and safer methods; the service aims at improving quality of life rather than treating or alleviating a disease; and patients are generally prepared to pay for the service themselves.
Informal payments have never been common in Estonia and continue to be relatively rare. A corruption survey by the University of Tartu (in 2011) concluded that the role of informal payments is marginal; 2% of patients acknowledged having paid informally to obtain faster access to care and about 3% paid after getting the treatment. In 2014, the European Commission (2014) published a report indicating that corruption in Estonia in general but also specifically in health care is lower than the EU27 average. The proportion of Estonian survey respondents saying that they were asked or expected to pay a bribe using health care services was 1%, below the EU27 average (2%). Overall, informal payments do not appear to be widespread or significant in magnitude (European Commission, 2014).
On 1 January 2018, Estonia reformed the reimbursement scheme for prescription medicines. In short, the reform harmonized the fixed co-payment fee to €2.50 (resulting in a reduction of fees for the 50% reimbursement group and an increase in fees for the 75%, 90%, and 100% reimbursement groups), reduced the thresholds for the additional benefit on prescription medicines for high spenders, and automated the calculation and reimbursement of the additional benefit at the point of purchase. (See the update "Changes to the pharmaceuticals reimbursement scheme" of 12 June 2018 for details.)
Data published in the 2018 annual report of the Estonian Health Insurance Fund show several effects of the reform. First, lowering thresholds of the additional benefits for high spenders and automating processes have considerably increased the number of people who received the benefit. In 2017, only 0.4% of people using reimbursed pharmaceuticals received additional benefits, with the average amount of €129 per person, while in 2018 the share increased to 15.6% of people, with the average amount of €77 per person. As a result, the number of people who spent high amounts on prescription medicines reduced remarkably. For example, the portion of the population who used reimbursed pharmaceuticals and spent more than €250 per annum on prescription medicines declined from around 2.8% in 2017 to only 0.1% in 2018.
The annual expenditure by the EHIF on the additional benefit on pharmaceuticals totalled €10.3 million, or 7% of all reimbursements for pharmaceuticals to households. The annual expenditure exceeded the planned budget by 25%. In part, the overspending can be explained through households purchasing regular prescriptions at the end of 2018, exploiting the annual nature of the benefit calculation.
The data also show that the combined effect of these changes led to a decrease in the average out-of-pocket (OOP) payment per prescription from €6.83 in 2017 to €6.31 in 2018. However, the decline only resulted from the large reduction in the category of prescription medicines that were compensated at a 50% rate, which decreased from €9.47 to €7.40. In all other categories of reimbursement (75%, 90%, and 100%), the OOP increased, both in absolute terms and as a fraction of total price. In these reimbursement groups, the increase in the fixed co-payment fee was larger than the average increase in the additional benefit."
A more detailed micro-data analysis is required to assess which socio-economic groups were winners and losers from the reform, as well as the impact of the reform on equity and cost-effectiveness. This especially requires evaluation in the context of reducing the burden of OOP payments for the most vulnerable socio-economic groups.
Estonian Health Insurance Fund (2019) Annual Report 2018, available at https://haigekassa.ee/sites/default/files/uuringud_aruanded/2018_majandusaasta_aruanne_eng_0.pdf