The management of the Health Fund presented to the Council an overview of the Fund's budget planning principles for the next four years, prepared on the basis of the latest economic forecast of the Ministry of Finance, which noted that the projected budget deficit in 2025 will reach almost 210 million euros. /nginx/o/2024/07/02/16194970t1hfcd6.jpg)
Logo of the Health Fund. Photo: Tervisekassa
The management of the Health Fund presented to the Council an overview of the Fund's budget planning principles for the next four years, prepared on the basis of the latest economic forecast of the Ministry of Finance, which noted that the projected budget deficit in 2025 will reach almost 210 million euros.
In 2025, the Health Fund will be able to increase its efficiency by 21 million euros through decisions already made or areas of its activities. To cover the missing 188.9 million euros, additional funding from the state or the use of the Health Fund's reserve, most of which is retained earnings, will be required. Using the reserve to the required extent requires changes in legislation. The Government of the Republic submits the final proposal for establishing the budget position of the Health Fund to the Riigikogu.
Health Minister Riina Sikkut says that health care funding is in a difficult situation as the sector's costs have increased due to the demographic situation and rapid development of medicine.
"The reality is that the need for health services increases every year due to the aging population, as well as the costs due to the increase in chronic diseases. At the same time, new forms of work, changes in the labor market and a reduction in the workforce have led to irregular receipt of social tax," the minister said.
"This means that the deficit budget for health care next year must be supported by using the reserve on the one hand, and on the other hand, it is necessary to find ways to save within the system. It is clear that using the reserve is a temporary solution and that financing health care in the future will require both efficiency and additional resources," Sikkut said. "This means that in the future we will have to agree on the sustainability of health care in the financing model. One of the possible options, which I presented to the government in the spring, is that money from the state budget will be allocated to the Health Insurance Fund and for the costs of treating people under 19."
At present, the Health Fund's reserve balance is around 700 million euros, of which 500 million is retained earnings. In 2025, according to the current budget strategy, the Fund's budget deficit will be 147.1 million euros.
The latest data, i.e. the summer economic forecast of the Ministry of Finance, give reason to believe that due to the reduction in tax collection the budget deficit will be even larger – almost 210 million euros.
Almost a third of the Health Fund's budget deficit consists of services transferred to the institution in recent years that were not financially supported or that had too little coverage.
