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Katie Dul

Internship Research Paper


Ministry of Human Resources
Hungry for HealthCare
Studying abroad requires moving and leaving a life you know to
live in a different part of the world for four months where things are
unknown to you. My decision to study abroad has brought me to
Hungary. Before traveling across the pond there existed this fear of
falling ill that was on the backburner of my mind, well, truthfully more
my mothers than mine so much. I questioned, how would you get
treated if you were an American student abroad? Access to healthcare
varies across the board from country to country. Thankfully I have yet
to have an experience that has landed me in a situation necessary of
medical attention. But for others I know that was not the case. Luckily,
there was guidance and assistance from our coordinators to lead them
in the right direction.
My interest in this field of healthcare study stems from the
immense knowledge there is to learn from it. Being that I worked as an
intern for the Ministry of Human Resources I was able to learn a lot of
how the system of education works. While working under the education
frame I discovered that interestingly enough the Department of Health
and the well being of the peoples health also reside under this same

Ministerial sector. Therefore I accumulated research that has helped


shed light on the topic of my interest, how healthcare in Hungary
works.
Healthcare is defined as the organized provision of medical care
to individuals or a community. It is the diagnosis, treatment, and
prevention of disease, injury, illness or other impairments such as
mental or physical. Access to such healthcare varies across the board
from country to country as mentioned earlier. The state of Hungary
covers 100% of their total population by the national health insurance
yet has been noted to have the lowest life expectancy in Eastern
Europe. Many health outcomes remain poor, placing Hungary among
the countries with the worst health status and highest rate of avoidable
mortality in the EU.
Following World War II Hungary under the communist
government had fully nationalized the social insurance. From then on
the Hungarian Healthcare system had been a state-owned, tax funded
universal system by the national health insurance fund available for all
of the people. In the aftermath of communist rule from the second half
of 1980s, Hungary transformed its healthcare system from centralized
Semashko state control to a more pluralistic, decentralized model. The
health care system shifted to a purchaser-provider split model with

new payment methods that have created incentives to improve


technical efficiency.1
In terms of Hungarys population and health status, while life
expectancy in Western European countries improved during the 1980s
partly due to dropping rates of cardiovascular diseases, this tendency
continued to worsen in Hungary as did deaths from cancer, liver
cirrhosis and external causes such as accidents and suicide. Hungary
has thus far completed an epidemiological transition. 2 A work written
on the Review of Hungarys health system described the countrys
health status in four phases. The period from 1989 to the mid- 1990s
was considered the third phase. The fourth and most recent started in
the mid-90s and has lasted till today. During these years it was found
that Hungary has seen a strong and steady increase in life expectancy
at birth among women and men alike. Yet, amongst all else the main
causes of death in Hungary are diseases of the circulatory system,
malignant neoplasms, diseases of the digestive system (including liver
disease) and external causes (including suicide). This pattern has
remained essentially unchanged since 2000, and mortality from each
of these causes continues to be higher than for the EU27 and, in the
case of malignant neoplasms and digestive system disease, the EU12

1 http://www.ceibs.edu/bmt/images/20110221/30199.pdf
2
http://www.oep.hu/pls/portal/docs/PAGE/LAKOSSAG/OEPHULAK_ALTINF/
HEALTH%20INSURANCE/HEALTH_INSURANCE_PROLOGUE.PDF

and WHO European Region averages (WHO Regional Office for Europe,
2010).
Through all the issues, Hungarys constitution guarantees the
right to a healthy environment, to an optimal level of physical and
mental health, and to income maintenance benefits in the form of
social security. The central government handles most responsibility in
terms of social welfare and health care provision as well as issuing and
enforcing regulation. Following the 2010 elections of which the FideszKDNP party has been governing, the government initiated structural
change. This meaning that 8 new super ministries were formed. The
Ministry of Human Resources merged seven areas of former ministries
and is responsible for the fields of health care, education, social affairs,
culture and sports, social inclusion and church related sector. Under
this ministry they aim to bring about the conditions for enhancing
quality of life through the creation of a reliable and efficient system of
welfare provision, a healthcare system that takes into account the
needs of both patients and healthcare professionals.
Though Hungary has centralized power over the health care
system there are other actors involved. The main actors are grouped
into columns according to four main functions: stewardship/ownership,
service delivery, financing and public health. The nature of the
relationships between these actors is shown as being hierarchical (solid

lines) or contractual (dotted lines).3 As evident in the chart there are


now various players in which have changed the hierarchical
relationships to ones of more contractual relationships. These contracts
between local governments and providers have replaced direct
ownership, and
privatization within
healthcare and have
grown since 1989.4
A large part of
managing a health
care system is
financing.
According to the
World Health
Organizations most
recent report on
Hungary some
challenges to be
faced are as follows:

3 Gal, P., Szigeti, S., Csere, M., Gaskins, M., and Panteli, D. Health
Care Systems in Transition: Hungary. Copenhagen: European
Observatory on Healthcare Systems, 2011.
4 Gal, P., Szigeti, S., Csere, M., Gaskins, M., and Panteli, D. Health
Care Systems in Transition: Hungary. Copenhagen: European
Observatory on Healthcare Systems, 2011.

Financial instability of the health insurance system due


to the fragmented polling and collecting system has
negative consequences for access and equity.
Ageing population and related increases in resource
needs for the health system.
High prevalence of lifestyle-related risk factors,
inadequate health promotion and preventive health
services.
Human workforce crisis and shortage due the migration
of health workers to other countries and the declining
attractiveness of the health care career because of low
wages in the sector. Long term strategy plan for human
resources is needed.
Health sector reform bypass public health services and
health functions with regard to health promotion and
prevention. 5

Supervised by the Ministry of Finance, the Health Insurance Fund (HIF)


is responsible for health costs. The HIF collects premiums at the
national level and allocates funds to 20 county branches, which in turn
enter into contracts with health care providers. Although the owners of
health care provider organizations (usually local governments) are
technically responsible for capital costs, in practice this usually takes
the form of grants from the national budget. The HIF is also underfinanced, and the state government is obliged to cover its deficit. So
state budgetary assistance is provided for capital costs, and in picking
up the slack of under funding. The result is a mix of tax and social
insurance-based funds responsible for financing Hungarys system.6

5 WHO. Hungary Country Cooperation Strategy.


http://www.who.int/countryfocus/cooperation_strategy/ccsbrief_hun_en.
pdf. May 2013
6 Datamonitor- Hungary: Country Analysis Report.

Regardless of employment status, coverage is universal therefore will


provide access to all ambulatory and secondary hospital health care for
all citizens. Health insurance (HIF) contributions are collected from
employees, who pay 3% of their total incomes, and employers who pay
15% of the employees gross salary.7 Approximately eighty-three
percent of the financing for the health care comes from taxes and
other public revenues. Aside from the state financing, patients can
make co-payments on certain services such as pharmaceuticals, and
rehabilitation. These out-of-pocket payments have increased
substantially since 1990, and currently contribute 18% to health care
financing.8 The figure above provides a visual of the total expenditure
going into the health care system.
In May 2011, Dr. Mikls Szcska,
Hungarys State Secretary of Health
(Minister of Health), announced the
ambitious Semmelweis Plan to
reform the national healthcare
system through decentralization. The drawn up plan gives priority to
the human resource issue. In the short term, the task is to increase the
earnings, transform the training conditions and improve the working
conditions in the sector. In the long-term, the aim is to elaborate a
career model for health workers working in the public or municipal
7 Datamonitor- Hungary: Country Analysis Report
8 Gal, P. Study of the Hungarian Health Care System. Civitas, 2002

health care system, which includes the planning of a career and


qualification system and ensuring of its financial background. The plan
also designates five levels of patient care: national, regional, county,
city/town, and outpatient clinics. The idea of this reorganization is due
to the continuous challenge of financing the healthcare system. Dr.
Mikls Szcska explains, Hungarys budget for public services is well
below the European average. We definitely should increase our public
spending on health in the coming years, but we should also shift our
investment focus from large institutions to new and efficient integrated
care models. He believes the aim is to reform all hospitals to make
them more efficient. Istvan Eger, president of the Chamber of
Hungarian Doctors, tells Napi.hu that Hungarys health care system
can only be cleaned up if the economic nonsense in the sector is put to
rest. In an article from the Budapest Beacon he answers,
The average among Visegrad Four countries is 6.5
percent of GDP, and the EU average allotted for health
care is more than 8 percent. In no situation can our
health care system be sustained at 4 percent of GDP.
Even if you take into consideration the burdens of
Hungarian economy and its ability to service its debts,
we still need to make a predictable and firm transition
because that is the only way Hungary will be able to
retain its human resources in this field.
Eger makes valid points in his interview to stress the opportunities for
improvement on the financial side that can be made all around but
especially in the sector of primary care.

In order to ensure efficiency the focus of the system has shifted


to concern with primary care. Hungary is trying to establish specialized
centers where GPs will act as gatekeepers to direct each patient to
the proper treatment facility. The government has been encouraging
patients to seek a referral from a GP of their choice so to limit excess
and access to expensive health measures that may not be necessary.
In most cases the patients will be sent to specialist. While GPs are
meant to be involved in preventative medicine and education, their
role continues to be a prescription and referral service.9 While the
overall practicing GP/population ratio is comparable to the rest of
Europe, the geographic and inter-specialty distribution of human
resources is unbalanced.10 A lack of adequate GP training and financial
incentives for physicians to retain patients are mainly to blame.11 This
issue factors into the health workforce crisis. The salary of health care
professionals, especially of physicians has remained low in comparison
to other sectors of the economy as well as other western countries.
This leads to under the table payments. The figure of this chart
exhibits the uneven distribution of physicians both in terms of

9 Orosz, E., and Burns, A. The Healthcare System in Hungary. Paris:


Organization for Economic Co-operation and Development, 2000.
10 WHO. Hungary Country Cooperation Strategy.
http://www.who.int/countryfocus/cooperation_strategy/ccsbrief_hun_en.
pdf. May 2013
11 Gal, P., Rekassy, B., and Healy, J. Health Care Systems in
Transition: Hungary. Copenhagen: European Observatory on Healthcare
Systems, 1999.

geography and specialties. According to a Bloomberg BusinessWeek


article Since Hungary joined the European Union in 2004, 500 to 600
doctors have left the country each year, and a recent survey by the
Health Services Management Training Center at Budapest's
Semmelweis University indicates that 60 to 70 percent of first-year
medical students plan to seek a job abroad after graduation. These
migrations causing shortages contributed to the human resources
crisis. The numbers are alarming when the annual number of medical
students graduating
range from 750-800
and approximately
590 doctors applying
for EU working
certificates. After
extensive
consultations with the
advocacy groups, the Hungarian Government made a legislative
commitment to improve the earnings of health professionals. The
legislation refers to health workers working as employees at publicly
financed health care providers owned by the state, a municipality, a
church or a higher education institution.12

12 Hungarian Health System Scan. May 2013.


http://www.eski.hu/new3/hirlevel_en/2013/HHSC-2013-1.pdf

Hungarys Health Care System as one can see is anything but simple.
Another interesting thing to stumble upon is that Hungary is a target
country in cross-border health care. Medical Tourism has been a
growing field in the healthcare system. It is surprising that, although
the measured satisfaction level with received care is fairly low,
Hungarians motivation to travel to another EU Member State for
medical treatment is very low compared with other EU countries, given
all the motivating factors, such as reducing waiting times for medical
treatment; receiving cheaper or better-quality care; receiving
treatment from a renowned specialist; and receiving treatment that is
not available at home (Lengyel, unpublished data, 2009). It is a target
country mainly for dental care but also for rehabilitative services, such
as medical spa treatment. Visitors can take advantage of great
healthcare for cheaper prices than theyd pay in their own countries.
Thus, the government sees the health industry as a potential strategic
area for economic development and growth.
The system is also responsible for providing social cares. This
includes long-term care, long-term nursing care, hospice, mental care,
dental care, and other services. For example they all differ in ways.
Long- term care is provided by health and social sectors. Location of
service provision is determined based on the patients health whereas
Long-term nursing care has different modes of provision (inpatient,
daytime hospital, outpatient and homecare.) Nursing care is under the

category of chronic care therefore it is in relation to rehabilitation and


palliative care or hospice. Social Care is taken care of by local
governments and has separate rules for eligibility and financing. Those
generally eligible are impoverished people and people with disabilities.
Mental health care is integrated into the main health and social care
systems both organizationally and in terms of financing. With a few
exceptions (removable dental prostheses for persons aged 1860;
technical dental costs for people under 18, students in a full-time
course of studies and for people over 60; dentures for people under the
age of 18, all of which require co-payments), most dental services are
available free of charge within the single-payer health insurance
system. Dental care as stated earlier is highly regarded in terms of
medical tourism. All of these separate sectors within the whole
healthcare system have intricate workings.
Overall, Hungarys reform implementation and healthcare system
has proved difficult and shall continue to be difficult because it has
many challenges to face. In turn the country as a whole has achieved a
successful transition from an over-centralized, integrated Semashkostyle health care system to a purchaserprovider split model with new
payment methods that have created incentives for increased technical
efficiency. For instance, Hungary introduced a DRG-based payment
system for hospitals as early as 1993 and has accumulated a wealth of
experience operating it. They have had many opportunities that help

better strengthen public health services. In joining the EU healthcare


investments through the help of EU funding have been boosted, the
government has recognized healthcare as a priority issue as well as
the fact that expenditure is low and political commitment to strengthen
this number has increased. Though the country still has a ways to go,
no one government or country has it perfect either and there are
always obstacles to face.
So now after my time here in Hungary and having researched the
Healthcare system I can say there is a lot to cover and a lot the
country has to look forward too. Just as any other country a system of
universal health coverage doesnt guarantee success. In turn from my
peers I have heard horror stories and successful stories from
doctors/hospital visits. Whether it is financing the cost, misdiagnosed,
unhelpful outcomes or easy fixes, they have all mentioned the
differences they see between our home and Hungary. My interest in
the subject has given me new insight into how a transitional Central
European Country has tackled healthcare and arrived at where it is
today and for that I am grateful.

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