The Baltic States and their health systems - From Soviet to EU

The Estonian health system differs from its Baltic neighbour states thanks to a transformation process and reforms.

Kardiolita, a private clinic built in 1998 in Vilnius, capital of Lithuania,...
Kardiolita, a private clinic built in 1998 in Vilnius, capital of Lithuania, has two operating theatres, 12 intensive care beds and 42 normal beds and offers a full programme of interventional cardiology, heart surgery, orthopaedics and plastic surgery

‘We only live in the old times, in which we had to pay nothing for a health service.’ Over 15 years after re-obtaining independence, this is the opinion of almost all involved in healthcare in the Baltic States Estonia, Latvia and Lithuania. However, the idea has not yet occurred to others, namely patients. Western standards are expected, but governments can no longer guarantee this free of charge. This leads to an excellent medical technology base, but also a chronic financial shortfall - and a partially booming private sector.

The Estonian health system differs from its Baltic neighbour states thanks to a transformation process and reforms that resulted to an entirely restructuring in1990. Small hospitals were closed or integrated into bigger ones. At the same time, hospital administrations reduced their length of stays and bed capacities and gradually moved the accounting system from case-overall oriented to diagnosis. To strengthen management, the government decided some years ago to privatise all hospitals - either as a non-profit corporation or as a corporation. Today the government is considering allowing only non-profit maintenance.

The new central hospital at Pärnu, capital of Estonia’s biggest district, may illustrate this process representatively: a big hospital, with over 1,000 employees, has emerged from many smaller ones. Today it offers not only broad medical care, but also stands for the highest level of technical standards. The government mainly financed the project; €500,000 for technical devices were funded by the European social funds. Parallel with the renewal process, the hospital management gradually reduced the clinics’ bed capacities from 1,300 in 2000 to approximately 940 beds in 2004.

The government also strengthened ambulatory care. Family doctors were upgraded to ‘doctor of first contact’ and became accessible to everyone, without any patient co-payment. At the same time the government gradually raised the salaries of family doctors and required them to take longer continuing training. From 1992 to 2001 the number of ambulant general practitioners (GPs) and doctor’s surgeries increased from 147 to 600. Although the earlier introduced family doctor’s system lends to the health service a modern image, it is not praised by all. Criticism of the reforms did not end, because too little money was spent for the health service during the economic boom: The health issue (5.4% of BIP) has not reached half of the EU average value (10.9% of BIP).

The Paula Stradinja University Hospital, in Riga, is one of 121 Latvian hospitals, and one of the two university hospitals. Patients with acute illnesses go to a university hospital mainly, because acute care belongs to basic medical care and is free. Neither time nor money remains for special treatments. Thus, family doctors urgently transfer less pressing cases because treatment takes place quicker and will be paid. Conversely, chronically sick patients must wait often over six months for treatment, because the limited hospital budget is filled with special treatments again. Up to 2010, the government plans to reduce the number of the hospitals to 52, and centralize the hospital system.

Although resignations of many Latvian hospital doctors has risen due to lack of money, since 29 April a bright spot has shone. The Ministry of Health agreed with the health workers union to raise the salary of physicians from around e330, gross monthly, to possibly double this year. The threatening lack doctors actually might be one of the main reasons for this. Every third physician is over 55 years old, approximately 20% will move abroad in the future. Latvia needs 1,500 additional doctors to guarantee care over the next decade. As in Germany, the situation tightened, first in rural areas because hardly any physicians want to go for the low money there. Another government motive for raising salaries is to fight corruption in the health service. According to a proposed law, medical doctors who accept ‘black cash’ payments will be punished. However, whether such a law can dam the usual practice is doubtful. If a patient voluntarily gives additional money directly to the hospital administration, it is not rejected.

That is not all. Patients also must pay an official participation of €2.50 for a house visit and €7 hospital admission fee, then €2.20 per day. Independent of the length of hospitalisation, €40 are charged for food and accommodation. Patients’ contributions in the whole of healthcare issues amounts to about €18,000,000 annually. While physicians and officials see patients absolutely in a position to pay these small amounts (‘Health is a question of the individual priority settlement’) observers of the Latvian health service assume that over a third of the population renounces this due to high additional payments for doctor’s visits. 170 doctors work in the biggest Latvian private ambulatory clinic, the patient’s case holds 250,000 people. 1,200 patients are treated daily; over 90% are insured privately, or pay for services from their own pocket. In Latvia, there are 16% of private ambulatory medical practices, but most run less than successfully. Many have too few beds and would not have the clientele who could afford private treatment.

According to politicians and officials, Lithuanian healthcare does not have weaknesses. Due to the recently announced salary increase, doctors are full of hope and hospitals are on the way to becoming high-tech health service centres. However, the number of hospitals and beds are no longer affordable. Since 2000, changing governments began closing hospitals. The bed capacity decreased from 1,300 for 100,000 inhabitants to less than 900 beds. Physicians are not the only victims of the chronic lack of funds, but are well organized. As consequence of low salaries, a lot of overtime and only moderate appreciation from patients, hundreds of doctors demanded more money in 2005. As result, the government now wants to raise salaries over four years. Before the strike, the salary of most doctors lay only briefly above the Lithuanian average income of e380 gross monthly. To reach such an income, GPs ten minutes to dispatch each patient. However, if most doctors did not have two or three positions, the salary increase had no noticeable effect. Well-trained, they will not feel the payment is appropriate. So it is not surprising that patients offer additional payments; the private contribution in 2003 was about 24%. Besides, one understands small financial allowances as gratitude rather than as bribery. The government plans to hit corruption in the health service, but thinks less of a corruption law. Possibly a state medical association to strongly control doctors would be the answer. Whether additional payments are the best way to tackle ‘black cash’ payments, will probably take some years to be seen.


Read all latest stories

Related articles


Article •

The needs of European hospitals are similar

Procedures, financing and cultural philosophies can shape the difference, Michael Reiter, Mark Nicholls, Eduardo de la Sota, Jane MacDougall report


Article •

Italy’s healthcare reform

Italian healthcare is still hitting the headlines. Although Prime Minister Mario Monti announced plans for healthcare reform at the end of 2011 – effectively cutting healthcare spend by €2.5…


Article •

Cuts in services for patients are difficult to justify when opportunities exist to improve hospital efficiency

There are many ways in which hospitals could improve efficiency and reduce the need for cutbacks in services for patients, according to a major review of hospital efficiency published today…

Subscribe to Newsletter