1
10
1
-
https://eprints.ibu.edu.ba/files/original/a0f564534d80e6e93f838754d6109031.pdf
41633c3a43b11248ca6bbd08281340a2
PDF Text
Text
Journal of Economic and Social Studies
Possibilities of Development of Private Health Insurance in
Bosnia and Herzegovina
Safet Kozarević
University of Tuzla
Tuzla, Bosnia and Herzegovina
safet.kozarevic@untz.ba
Senija Nuhanović
University of Tuzla
Tuzla, Bosnia and Herzegovina
senija.nuhanovic@untz.ba
Irnela Hrnjić
University of Tuzla
Tuzla, Bosnia and Herzegovina
Abstract: Increased rise in costs of healthcare in the last five decades has
rapidly increased interest in the functioning of healthcare systems within
every country. The reasons for growth in healthcare costs are related to
demographic changes, technology advancement, increased number of
educated persons, emergence of new diseases, etc. Financing the risk of poor
health is mainly organized through programs of social and private health
insurance. Regarding the management of the risks of poor health in Bosnia
and Herzegovina (BiH), the social health insurance system is the basic
solution for the population. However, in BiH, as in other countries in the
world, the system of social insurance has become unfeasible and it is
necessary to search for new solutions, that is, to reform the system. The
research subject in this paper is private/voluntary health insurance offered
by insurance companies, which can be an efficient addition to social
insurance in BiH. It has become present on the market of private insurance
in BiH only recently, so its share in the total premium of private insurance
is still minor. Therefore, a primary research was conducted on the
possibilities for its development as well as on the need and acceptance by the
users of healthcare services. Besides, there was a need for examining the
performance of the existing system of social health insurance, based on the
principles of Bismarck’s model of financing, and recognizing its
disadvantages. By identifying and eliminating obstacles for development of
voluntary health insurance, it is possible to improve performance of the
existing system of health insurance in BiH.
Volume 5 Number 1 Spring 2015
Keywords:
Private/Voluntary Health
Insurance; Social Health
Insurance
JEL Classification: G22,
I13
Article History
Submitted: 23 May 2014
Resubmitted: 29 June 2014
Accepted: 3 July 2014
http://dx.doi.org/10.14706/J
ECOSS11512
87
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
Introduction
Health is the basic human right and one of the most important assumptions for
economic development and life quality of a country’s population. There is huge
responsibility of individuals and communities regarding the prevention of disease
occurrence and good health keeping and improving. Healthcare system is a complex
entity whose functioning largely influences the level of population’s health, which
indirectly affects the economic system as well. Very often the level of country’s
development is represented as the level of health of an individual and the entire
population. That is the reason why states are the bearers of the activities related to
healthcare system management.
Every state has a specific healthcare system that can have some similarities when
compared to other states. For many years, the awareness on the importance of health
and health insurance has been growing stronger. Many make efforts to find the
appropriate model that would satisfy the highest possible needs for healthcare
services, along with low costs and higher quality of services. From the country’s
point of view, Bismarck’s or Beveridge’s model of healthcare system usually
dominates, but there are other options that are combined or mutually
corresponding.
Bosnia and Herzegovina (BiH) is characterized by the inherited Bismarck’s model of
social health insurance whose effectiveness has been long questioned, while the
country’s needs for healthcare increased significantly as the consequence of the war.
Only in recent years, there has been more attention paid to the issues of the
functioning of country’s health system, quality of services provided and alternatives
to social health insurance. Some reforms of primary healthcare have already been
implemented (Atun et al. 2007), but the reform of current model of financing is
necessary, and it should provide a framework for introducing other forms of health
insurance, such as voluntary health insurance provided by private insurance
companies. However, the present offer of voluntary health insurance is still at a very
low level. The reason for this is the lack of legal regulations and low interest by the
state for entering partnership in health insurance with insurance companies.
The aim of this paper is to establish the possibility for developing voluntary health
insurance within the existing reform of the healthcare system in BiH. Due to that,
based on the results of the secondary research, the most significant disadvantages
were presented in terms of effectiveness of the existing system of social health
88
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
insurance. After that, based on the results of the primary research, the interest in the
package of voluntary health insurance was registered by private healthcare
institutions, citizens and insurance companies. The primary research was also to
confirm the disadvantages of the existing system of social health insurance.
Healthcare System in BiH
Matter of health insurance needs to be observed in broad context of healthcare
system, which is organized in a specific way in BiH. Healthcare in BiH is regulated
on level of entities and Brčko District, and it esults in a very complex organizational
solution, especially considering that on level of BiH Federation, besides entity
ministry, there are also ten cantonal ministries of health. It is clear that this
significantly increases costs of transactions and makes coordination in decision
making more difficult (Kozarević, 2010).
Healthcare in BiH is regulated with laws on healthcare adopted on level of entities.
These laws have defined the concept of healthcare, which basically comes down to
set of measures focused on systemic management of risks of poor health of the
citizens. In purpose of that, competencies of specific institutions were established in
this system, whose purpose is to enable high inclusion of population with right on
healthcare, according to principles of: universality, cost-effectiveness, fairness,
freedom of choice and autonomy.
Health insurance within the social insurance in BiH is regulated with provisions of
laws on health insurance on level of entities as well as corresponding regulations on
Brčko District and cantonal levels. A special place in healthcare system belongs to
health insurance institutes (funds) and public health institutes which were
established on level of entities as well as Brčko District and level of cantons.
Cantonal health insurance funds are formed for activities performed on level of
cantons in BiH Federation. BiH Federation health insurance fund collects the assets
of federal solidarity which are used to form Solidarity Fund of BiH Federation. Its
purpose is to equalize conditions of compulsory health insurance in all cantons, to
organize certain programs of healthcare in interest of BiH Federation and to enable
providing of priority and most complex forms of healthcare from certain special
fields. The assets of federal solidarity are provided from contributions for
compulsory health insurance. Crucial difference in Republic of Srpska is in higher
level of centralization through unified health insurance fund.
Volume 5 Number 1 Spring 2015
89
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
Public health institutes also play significant role, and they are performing publichealth activities focused on planning and implementation of measures for:
supervision over infectious and noninfectious diseases, providing of health safety of
food, water, air and products for general use, monitoring of the environment,
promotion of health, prevention of diseases and implementation of regular healthstatistical researches. Besides that, public health institutes are also in charge for
providing of information on leading health issues and priorities, as well as for
proposals for their solving.
Literature Review
The issues of health insurance have been everlastingly urgent and they provide
material for constant research. By founding the World Health Organization (WHO)
on April 07, 1948, the United Nations particularly emphasized their work in the
field of healthcare. Under the auspices of the WHO, numerous conferences were
held, whose aim was to define the suggestions for improving population’s health.
One of the most important conferences for creating healthcare systems of the
modern times was the one held in Alma Ata in 1978. Then the declaration “Health
for All by the Year 2000” was brought that established the policies related to health
protection on the global level.
Public discussions led in many countries related to healthcare are mainly
concentrated on the amount of health allocations or the issues related to increased
costs and the need for the control of spending the resources in the healthcare system.
Zrinščak (1999) compares the countries by various indicators such as: health
allocations, healthcare system model, most frequent causes of death, etc. Although
many healthcare indicators are getting improved, the inequality of the countries in
terms of access to healthcare and social inclusion is increasing. Zrinščak mentions the
following possible ways of cost control: (1) Measures related to patients –
copayment, modalities of paying sick leave compensations and introducing waiting
days, discounts in cases when insurance premiums during one year are not used, and
limitations in selecting doctors and hospitals, (2) Health funds – reducing
administrative costs, competition between private and mandatory funds, (3)
Measures related to hospitals and doctors – encouraging competition among doctors
and various models of payment for medical services, and (4) Measures aimed at
control of pharmaceutical costs expressed through various models: “permitted” and
“prohibited” drug lists, state regulation of prices, determination of the highest price,
budget financing, etc.
90
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
In the last few years there has been a particular emphasis on the reform of the health
insurance in the USA. Booz & Co (2012) established in its research that nowadays
employers move towards the model of contributions deposited on savings accounts.
Thus, employees may use the funds to choose the insurance package as they wish,
instead of the earlier model of benefits in which company created the insurance
program for all. Vaughan E. & T. (2000) believe that, regardless of the fact whether
the financing system is private or public, it is influenced by adverse selection. They
emphasize that private insurers’ premiums grow due to increased costs of medical
services caused by population aging, improved medical technology, capacity overload
and preventive medicine. Additional criticism to the US healthcare system is related
to unequal access to medical care, unequal quality of medical services, significant
misuse, inefficiency and frauds (Wiening and Rejda, 2007). While describing the
reform of the health protection initiated by President Obama, Schansberg (2011)
emphasizes that the state’s solutions to health protection are not efficient and that
the advocates of healthcare free market should provide convincing evidence in favor
of a real reform and conduct it where possible. He believes that abolishment or at
least reduction of subsidies to health insurance based on employment would be the
first step towards the free market of healthcare, and that employers would try to
present several options to their employees. The effect of economies of scale is also
possible if the groups of employers are categorized in only several insurance types.
According to the analysis made by Deloitte (2012), as a direct result of the
Affordable Care Act (ACA) it was estimated that some 32 million Americans by the
year 2014 will have been insured. As of 2014, most of these individuals are to possess
a minimum level of health insurance, whether by state-sponsored plans, plans
sponsored by employers or plans provided on the market of individual insurance
policies. In order to improve the access and respect patient’s rights, the ACA
introduced new commercial standards such as: abolishment of medical underwriting,
elimination of age limit, prohibition of exclusion based on previous illnesses, and
cancellation of cost share (participation) for preventive services. Health plans would
also have to provide the guarantee and renewing option as well as the coverage for
essential medical privileges. The ACA introduces new distribution channels that
would make the access to health insurance markets easier. National health insurance
stock markets have been established aimed at providing information to potential
clients and the facts on the range of health plans. Stock markets are designed for
those who are not included in Medicaid, Medicare or employer sponsored plans.
Volume 5 Number 1 Spring 2015
91
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
The study conducted by the European Observatory on Health Systems and Policies
(2006), which discussed the private health insurance in Great Britain, showed that
the number of new users is static, if not decreasing, that the market numbers for
these types of insurance for corporations falls, and that insurance companies are to
turn to smaller firms and individual policies. Vidojević (2011) describes the health
system of Great Britain and the National Health Service (NHS) that is the basis of
the entire system. The result of the economic crisis in 2008 is the plan for
introduction of radical reforms, probably the most drastic ones in the last four years.
In July 2010, the White Book Equity and excellence: Liberating the NHS was
presented, which defines a new way of the NHS functioning. Patients will actively
participate in making important decisions related to their health, in all stages of
treatment. The feasibility of this change shall involve larger accessibility of medical
documentation and the possibility for a patient to have an insight into it at any
moment and, if he wants, to share it to a third party. Provided that all the planned
measures are taken, in the following 4 years the savings should be achieved
amounting to almost £20 billion that could be invested into the improvement of
health service quality.
In terms of financing healthcare in the European Union (EU) member states, Totić
(2012) emphasizes that the national bodies of every EU member states join the
collected contributions into the health funds for that purpose. Such fact leads to
reluctance of certain groups to collective payment of subsidized costs of healthcare
for other people, especially in poorer EU member states. This consequently increases
reluctance to regular payment of taxes and/or contributions. Private health insurance
is suggested as an alternative. Janković (2011) states that private (voluntary) health
insurance is usually specified for the part of the population exempt from mandatory
health insurance based on their high income (the Netherlands), the part of the
population that may, based on their high income, choose whether to stay in
mandatory or opt for voluntary health insurance (Germany) or for the part of the
population, the so called self-employed (Austria and Belgium). The level of coverage
is in the range of 0.2% in Austria up to 24.7% in the Netherlands.
The search for a satisfactory system of financing healthcare is also present in Russia.
Šolak (2007) believes that Russia needs a complete reorganization of the system of
mandatory social health insurance. Fifteen-year long reforms did not lead to the
goals that were set. One can notice the disruption of the proclaimed principles of
social justice regarding the access of medical assistance, while the level of quality and
culture in terms of health service is not appropriate to the modern needs.
92
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
Being a country in transition, on its way to healthcare reform, BiH suffers numerous
problems due to its constitutional arrangement (two entities – BiH Federation which
consists of cantons and Republic of Srpska – and Brčko District) and the fact that
healthcare is regulated at the entity levels (Cain et al., 2002). The system in BiH
Federation was decentralized too early, since every canton is responsible for its
administration and the financing of healthcare. The system in Republic of Srpska
(RS) is centralized and it has one body – the Ministry of Health that monitors the
healthcare system. Due to the lack of appropriate legal mechanisms, coordination
between the entities is rather poor, while in BiH Federation the cantons do not
mutually cooperate at an appropriate level. Untimely decentralization brought a
dramatic change of the system from the aspect of administrative structure and
management, while the institutions continued their work without changes and kept
the same functions as before the 1992-1995 war. The reason is that they were not
able to develop the necessary skills and capacities that would stand such strong and
complex processes of decentralization. That is why many functions in the cantons
and entities are duplicated. The detected problems are also related to almost
complete lack of planning function in healthcare, implementation of the passed laws,
as well as a complex organizational structure. The implementation of health reform
starts with a paradox including an innovative approach against the political resistance
to changes as well as enthusiasm against obstacles. BiH cannot respond to all
demands for healthcare and the situation is substantially worse than in 1992. A
significant number of life-important medical treatments does not exist. There is a
certain interest in the system reform, but nothing would move forward until the
entities start cooperating and creating unified strategies for the entire country
(CARDS Program 2005).
For the purpose of health statistic records, the Public Health Institute of BiH
Federation (2012) specified a set of conclusions on the total health condition of the
population. The healthcare reform in BiH Federation is oriented to strengthening
primary health protections, with the emphasis on promotion of health and
prevention of illnesses. However, there are still discrepancies present in the
population’s access to the teams of primary health protection in the cantons of BiH
Federation. In accordance to the adopted Strategy for development of primary health
protection, the process of implementation of family medicine in BiH Federation
continued gradually. Even though there is a significant number of educated doctors
and nurses and improved infrastructure, implementation of family medicine is still
not satisfactory. A particularly evident problem is constant turnover of already
Volume 5 Number 1 Spring 2015
93
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
insufficient staff, medical doctors in particular. Implementation is more difficult
mostly due to a slow restructure of departments within outpatient clinics, in
accordance to the Strategy for development of primary health protection, nonstimulating mechanisms of payment, lack of managerial skills and insufficiently
coordinated legislative.
Methodology
The existing systems of health insurance, not only in BiH but also in other countries
in the region and world, show numerous disadvantages. The legal framework in BiH
defined voluntary private health insurance as the option that citizens can use by their
own choice.
The assessment of performances of the existing model of health insurance in BiH is
based on the secondary source indicators, announced by Eurostat (2012), the World
Bank (2012), Central Bank of BiH (2012), Federal Ministry of Health (2013),
Public Health Institute of BiH Federation (2012), Public Health Institute of RS
(2011) and Agency for Statistics BiH (2012). Special attention was given to the
following indicators: level of health protection costs, in particular expenditure on
drugs from personal resources of the population; state’s allocations for healthcare;
rates of natural population growth; leading causes of death; organizational structure
of the health system; social and economic environment; availability and structure of
healthcare personnel; characteristics of primary protection; amount of contribution
for health insurance; populations’ coverage by health insurance; population’s
structure by work status; development of the private sector of health protection and
legal regulations, as well as population’s familiarity with these regulations.
In order to reach research purposes, the development of voluntary health insurance
in BiH is defined as the independent variable, while the improving the effectiveness
and efficiency of the existing health insurance system in BiH is the dependent
variable. The starting premise in the paper is that by identifying and removing
obstacles for development of voluntary health insurance, it is possible to improve
effectiveness of the existing system of health insurance in BiH. Therefore, the paper
attempts to confirm that there is room for its development through the reform of
healthcare system, extension of the existing model of social insurance and also that
there is interest by insurance companies in a more serious approach to the offer of
health insurance package. For the purpose of confirming the formulated hypothesis,
the empirical research was conducted by survey of three groups of subjects: private
94
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
healthcare institutions, citizens, that is, the users of healthcare services, and insurance
companies.
The questionnaire for private health institutions consisted of 12 questions, in which
the respondent had offered answers. In some questions there was option of entering
a new, own response that was not listed in the questionnaire. Private health
institutions located in Tuzla Canton are listed on the web site www.bhzdravlje.ba,
where they are classified according to the activity and the level of care they provide
to their customers. Of the total number of these institutions, the survey answered 51
institutions located in Lukavac, Gračanica, Gradačac, Srebrenik, Tuzla and Živinice.
The second survey was focused on citizens and the questionnaire similarly consisted
of 12 questions with multiple choice answers. A total number of 183 healthcare
service users filled the questionnaire. One part of the survey was conducted online by
the Internet news portal - www.lukavac-x.ba (115 respondents from different age
groups).
The last e-mail survey was focused to private insurance companies. The
questionnaire, consisted of 10 questions with multiple choice answers, was send by email to all insurance companies registered in BiH. Since two insurance companies
have branches in both entities, total number of active insurance companies in BiH is
22, and eight of them responded to the e-mail survey.
Results and Discussions
Disadvantages of the Existing System of Social Health Insurance in BiH
Based on the analysis of secondary source indicators, a general rate is that the existing
system of health insurance in BiH has many disadvantages. There are many fields in
the healthcare sector that require changes and improvements. The following part of
the paper mentions the most significant results obtained on the basis of the
secondary source analysis.
The rates of social insurance contributions are too high, even when compared to the
OECD and new EU member states. The rate of social contributions in BiH
Federation is 41.5% on gross salary, while in RS that amount is 33%. Over 50% of
those covered by health insurance (retired persons, unemployed, invalids, war
veterans) are exempt from paying contributions and their health insurance is
Volume 5 Number 1 Spring 2015
95
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
financed by the transfers from other non-budgetary funds and public revenue.
Besides, the insured/retired number ratio grows in favor of the retired persons and is
around 1.1:1, which is definitely not a desirable trend. It is well known that this
ratio needs to be 4:1 in order for the social insurance system to function properly.
The total healthcare expenditures in BiH are around 10.3% of the GDP, which is a
level much higher than in most EU countries. Almost 60% of the total healthcare
expenditures are paid from public resources while more than 40% are financed by
households from their own resources.
Unfavorable trends in the economy, war events, economic blockade, huge growth of
unemployment, increased influence of grey economy, increased costs of healthcare,
change in the structure of insured categories, etc., affected the increase in personal
participation of citizens in the provision of health protection, economic situation in
healthcare, and financial business activities of health insurance funds.
Natural rates of population growth change more rapidly in comparison to the EU
countries. Also, due to higher mortality rates compared to birth rates, natural
population growth (-0.8%) has a negative value and it leads to natural depopulation.
Regular healthcare statistics data show that chronic diseases are dominant in BiH
when it comes to the leading causes of population diseases and mortality. Due to
diagnostics costs, therapy, and rehabilitation of patients, such diseases are the leading
health problems every year and they are a significant burden for the limited budget
of the health sector and the entire community. Also, the results of the population
surveys confirm unfavorable trends of life style and habits of the population with
addiction diseases being dominant (smoking, alcoholism, drugs and psychotropic
substances), inappropriate diet, overweight and obesity, as well as the lack of physical
activity, which are the key risk factors for the health of BiH population.
Organizational structure of the healthcare system is rather complex with the
fragmentation of the system present, particularly in BiH Federation, where the
cantons have the authority over healthcare services. Therefore, the healthcare system
in BiH Federation includes: Federal Ministry of Health, ten cantonal ministries of
health, Federal Institute of Health Insurance and Reinsurance, ten cantonal
institutes of health insurance and eleven public health institutes. The healthcare
system in RS is centralized at the entity level.
96
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
A large part of BiH population is not covered by health insurance and does not have
the right to healthcare. The largest number of the uninsured persons in RS includes
the employees of the companies in which employers do not pay health insurance
contributions. There is an additional problem in BiH Federation for the
unemployed who miss the 30-90 day deadline for registration at the employment
bureau and then lose all rights to health insurance through this bureau.
The public is not familiar enough with the process of passing and changing laws.
The media do not sufficiently follow and inform on the laws in the field of
healthcare that are in the process of passing and enacting in parliaments.
Furthermore, authorities do not invest any efforts to make these new laws closer to
citizens and introduce them to their rights.
Empirical Research into the Possibilities for Private Health Insurance
Development
Research into Private Healthcare Institutions
Based on the answers received from private healthcare institutions, it was established
that female persons have a bigger share in their user list (63%). From the aspect of
patients’ age structure, the highest number was in the range 19-55 years (41%), then
56-75 (32%), while the proportion of the patients aged 0-18 (15%) and 76-100
(12%) was relatively small. Almost all their patients have social health insurance
(96%).
The officials of the private healthcare institutions presented the reasons why patients
choose to use the services in the private sector. They are given in Table 1. The most
important reasons for using their services are high quality and fast service. Most
private healthcare institutions (71%) believe that their services are of higher quality
than those provided by the public healthcare institutions.
Only 41% of the private healthcare institutions have contracts for certain services
with the institutes for social health insurance. On the other hand, they are highly
interested (75%) in contracting the services with these institutes. Table 1 shows that
the satisfaction degree of those institutions that have the contracted services with the
institutes is at a very low level (only 6% of them are completely satisfied).
Volume 5 Number 1 Spring 2015
97
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
Only 43% of the private healthcare institutions support the policy of a complete or
partial opening the space in the healthcare system of BiH. The reason for this is that
27% of the institutions believe that their current position compared to the public
healthcare institutions is poor. Private healthcare institutions offer certain
suggestions for patient’s better access to healthcare services, not only in private but
also in the public healthcare sector as follows:
• Increasing the involvement of private institutions in healthcare (57%).
• Increasing the flexibility of contracts in terms of prices and other conditions
(35%).
• Strengthening the monitoring of the contracted services and public
announcement of data in terms waiting, quality, satisfaction, accessibility,
etc. (47%).
• Improving the regulation in both sectors (37%).
• Other (12%): controlling public procurements in the public sector, defining
patients’ rights and obligations of medical service provider by introducing
clinical guides into the law on health protection, providing a patient with
the option to choose where to use healthcare services and equaling private
and state healthcare.
Private healthcare institutions are highly interested in cooperating with private
insurance companies (59%), but only a small number of them have already
concluded the contracts with insurance companies (14%). Only 9% of the
institutions replied that they did not see their interest in such type of business
arrangement. The institutions that stated they do not have an opinion on the subject
(20%) believe that they lack sufficient information on advantages and disadvantages
of such arrangement.
98
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
Table 1: Surveys’ Results
Survey of private healthcare institutions
Reasons why patients choose private healthcare institutions:
Service speed
68,63%
Service quality
84,31%
Impossibility of services in the public sector
45,10%
Higher patients' confidence
49,02%
Other
11,76%
Satisfaction by the conditions of contracted cooperation with the health insurance
institutes:
Completely
5,88%
Partially
No, due to prices
No, due to payment overdue
No, for some other reasons
17,65%
13,73%
11,76%
9,80%
Survey of users of healthcare services
Reasons for using the healthcare services provided by the private sector:
Impossibility for getting the appropriate service in the public sector
Impossibility for getting fast service in the public sector
Lack of confidence in the services provided in the public sector
None of the mentioned
Other
Citizens’ experience while using the services of public and private
institutions:
Public
Rude staff
27,33%
Long waiting for some services (tests, referral letters to 38,26%
specialists, medications, etc.)
Unprofessional healthcare staff
18,33%
Low quality treatment
12,86%
Other
3,22%
Source: Authors’ research
Volume 5 Number 1 Spring 2015
43,17%
50,82%
21,86%
10,38%
8,20%
healthcare
Private
3,76%
10,22%
5,91%
4,84%
75,27%
99
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
Research into the Users of Healthcare Services
Most research subjects in the group of the users of healthcare services were male
persons (67%). The largest number of them belongs to the age group in the interval
19-55 (87%), with significantly smaller proportions of other age groups 56-75, 0-18,
and 76-100, in percentage 8%, 3% and 2%, respectively. Out of 92% of the
subjects, who had social health insurance, 78% of them were not satisfied by the
existing social health insurance. Only 20% of the subjects stated that they do not
frequently use the services provided by the private healthcare sector. The reasons are
given in Table 1, and it is evident that their reasons are rather similar to those stated
by private healthcare institutions meaning speed of services, lack of certain service in
the public sector, and higher confidence in the private sector.
Regarding the quality of private versus public healthcare institutions, 73% of the
subjects believe that the services in the private sector are of higher quality. The
reasons for dissatisfaction by the existing social health insurance are given in Table 1,
parallel with the rate given for the services provided by the private sector. It is
evident that the subjects who had already used the services provided by the private
sector rated their quality as much higher than in the public institutions. Similarly,
Table 1 showed that the private healthcare institutions recognized long waiting for
some services, unkind and unprofessional staff and low-quality treatment as the same
reasons why patients/clients opt for the private sector services.
More than 93% of the subjects believe that their social health insurance should
provide them with a broader coverage of healthcare services. Only half of the subjects
are familiar with the possibility for health insurance via insurance companies, while
86% of them would opt for private health insurance provided that their price is
affordable.
Research into Insurance Companies
Underdevelopment of the private insurance market in BiH is evident from the
realized structure of the premium on the market. The largest share belongs to the
compulsory motor third party liability insurance. In the entire premium structure,
the share of health insurance is 1.59% (BiH Federation 1.87% and RS 0.78%), and
this is mainly for traveler’s health insurance. The market itself is highly fragmented,
with a significantly higher number of insurers than needed for such a small market.
As many as 14 insurers have the market share below 3%. Domestically owned
100
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
insurers cover less than half of the market. There are 10 active insurers on the market
that are under majority foreign ownership, but they cover almost the entire life
insurance market. The owners of these insurers are in Austria, Croatia, Serbia, and
Slovenia. One company for reinsurance is also present on the market.
Although all the insurance companies surveyed plan to introduce voluntary health
insurance, only two of them currently offer these products. The insurance companies
that provide the package of voluntary health insurance offer various products
including those that cover the basic package of healthcare services to those that cover
a wide spectrum of services. Female persons make 55% of the insured structure while
the dominant age group is 19-55 (70%). Cooperation with the private healthcare
institutions is registered for only one third of the products and 50% of the subjects
believe that the private healthcare institutions are cautious because they are not well
informed about the voluntary health insurance. Thirty-three percent of the subjects
think that these institutions are interested in cooperation while the remaining 17%
believe that the healthcare institutions are not interested as they do not see any
benefit from such cooperation.
Half of the subjects think that the insurance market is ready for the offer of
voluntary health insurance package, while the other half estimate that the market is
still not mature enough for such offer. Most of the insurers (83%) think that the
reform of the healthcare system should envisage the room for voluntary health
insurance provided by private insurance companies.
Conclusion
The research described in this paper shows the current situation in the healthcare
system of BiH. A large number of indicators point at the system crisis, inefficiency,
dissipation of scarce resources, large dissatisfaction of all participants, and other
disadvantages. Regarding the private voluntary health insurance as the addition to
the existing system of social health insurance, it is not developed due to many
obstacles that need to be passed. On the other hand, interest in the introduction of
such type of insurance, as showed by the results of the primary research, is high in
the private healthcare institutions, users of healthcare services, and insurance
companies.
Development of voluntary health insurance is necessary and perhaps the only way
out of the current situation. Unsustainability of Bismarck’s model of healthcare
Volume 5 Number 1 Spring 2015
101
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
system, not only in BiH but globally as well, is obvious, and there are numerous
arguments that prove this statement. That is the reason why for a long time
alternatives have been sought as well as additions to the traditional models of
healthcare systems. The main causes of unfavorable relationship between the payer of
health contributions and the users of health protection are demographic changes,
that is, an immense increase in the participation of the old population (retired
persons) and high unemployment rate. Consequently, this reflects in the decrease in
the number of those who pay contributions and the increased number of health
protection users.
Unfortunately, there is no universal solution or an optimum model of healthcare
system that would be widely acceptable. However, depending on the country itself
and its characteristics, it is possible to create a combination of one of the models
with the additional insurance options such as voluntary health insurance provided by
private insurance companies. In this respect, the development of voluntary health
insurance in BiH should be observed as an important breakthrough towards the
improvement of health protection.
The disadvantage of the voluntary health insurance lies in the fact that it does not
have social solidarity. This means that those with higher risks of diseases pay higher
insurance premiums (sick, old, smokers, etc.). A good thing for these categories of
citizens is the fact that they would still have their social insurance. In other words,
relieving the burden of the healthcare system by means of voluntary health insurance
would leave more room for more endangered categories of the population.
Finally, it has been confirmed that in the forthcoming reform of the healthcare
system, which is obviously necessary, one should search for the room to develop
voluntary healthcare insurance provided by private insurance companies. By
removing the obstacles for development of this type of products of private insurance,
it is possible to make significant improvement of the existing system of health
protection in BiH.
102
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
References
Agency for statistics of Bosnia and Herzegovina (2012). Demography 2011.
Temathic
Bulletin
2.
Retrieved
February
16,
2013,
from
http://www.bhas.ba/tematskibilteni/demografija%20konacna%20bh.pdf
Agency for statistics of Bosnia and Herzegovina (2012). Labour Force Survey 2012.
Temathic
Bulletin
10.
Retrieved
February
18,
2013,
from
http://www.bhas.ba/tematskibilteni/lfs_bh.pdf
Atun, R.A., Kyratsis, I., Jelic, G., & Rados-Malicbegovic, D., Gurol-Urganci, I.,
(2007). Diffusion of Complex Health Innovations - Implementation of Primary
Health Care Reforms in Bosnia and Herzegovina, Health Policy and Planning, 22,
28-39.
Booz&Co. (2012, March). A global management and strategy consulting firm.
Authors: Kapur, A., Kaura, A., Javanmardian, M., Borromeo, P. The Emergence of
Private Health Insurance Exchanges Fueling the Consumerization of EmployerSponsored Health Insurance. Retrieved January 10, 2013, from
http://www.booz.com/media/file/BoozCo-Emergence-Private-Health-InsuranceExchanges.pdf
Cain, J., Duran, A., Fortis, A., & Jakubowski, E. (2002). Health Care Systems in
Transition - Bosnia and Herzegovina. The European Observatory on Health Care
Systems,
Copenhagen.
Retrieved
February
27,
2013,
from
http://www.euro.who.int/__data/assets/pdf_file/0018/75132/E78673.pdf
Central Bank of Bosnia and Herzegovina (2012). Bulletin 3. Retrieved February 20,
2013, from http://www.cbbh.ba/files/bilteni/2012/bilten_3_2012.pdf
Deloitte (2012). The Impact of Health Reform on the Individual Insurance Market
A
strategic
assessment.
Retrieved
January
10,
2013,
from
http://www.deloitte.com/assets/DcomUnitedStates/Local%20Assets/Documents/He
alth%20Reform%20Issues%20Briefs/us_chs_HealthReformAndTheIndividualInsur
anceMarket_IssueBrief_101011.pdf
European Observatory on Health Systems and Policies (2006). Authors: Foubister,
T., Thomson, S., Mossialos, E., & McGuire, A., Private Medical Insurance in the
Volume 5 Number 1 Spring 2015
103
�Safet Kozarević, Senija Nuhanović, Irnela Hrnjić
United
Kingdom.
Retrieved
January
10,
2013,
from
www.euro.who.int/__data/assets/pdf_file/0007/98422/Private_Medical_Insurance_
UK.pdf
European Union’s CARDS Programme for Bosnia and Herzegovina (2005).
Functional Review of the Health Sector in Bosnia and Herzegovina – Final Report.
Retrieved January 21, 2013, from www. parco.gov.ba/?id=1388
Eurostat, (2012). Key figures on Europe 2012. Retrieved February 23, 2013, from
http://epp.eurostat.ec.europa.eu/cache/ITY_OFFPUB/KS-EI-12-001/EN/KS-EI12-001-EN.PDF
Federal Ministry of Health (2013). Report on Realisation of Strengthening Health
Sector
Project.
Retrieved
February
08,
2014,
from
http://www.fmoh.gov.ba/images/porodicna_medicina/o_projektu/dokumenti/Izvjest
aj_HSEP_AF_2012.pdf
Institute for Public Health FB&H (2012). Health Status of Population and Health
Protection in Federation of Bosnia and Herzegovina. Retrieved February 24, 2013,
from http://www.zzjzfbih.ba/2012/08/zdravstveno-stanje-stanovnistva-i-zdravstvenazastita-u-federaciji-bosne-i-hercegovine-2011-godina/
Janković, D. (2011). Health Insurance within Health Care Expenses. Higher School
of Professional Business Studies Novi Sad, Journal 4, 69-83. Retrieved February 17,
2013, from http://www.vps.ns.ac.rs/SB/2011/8.7.pdf
Kozarević, S. (2010). Risk management and Insurance. University of Tuzla, Faculty
of Economics.
Law on Health Insurance, Official gazette of BiH Federation, No. 30/97.
Law on Health Insurance, Official gazette of Republic of Srpska, No. 18/99, 51/01,
70/01, 51/03, 17/08 and 1/09.
Law on Healthcare, Official gazette of BiH Federation, No. 29/97.
Law on Healthcare, Official gazette of Republic of Srpska, No. 18/99, 58/01, 62/01.
104
Journal of Economic and Social Studies
�Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
Public Health Institute of Republic of Srpska (2011). Analysis of health of
population of Republic of Srpska. Retrieved February 24, 2013, from
http://www.phi.rs.ba/documents/publikacija_zdr_stanje_2010.pdf
Schansberg, E.D. (2011). Envisioning a Free Market in Health Care, Cato Journal,
Vol 31(1), 27-58.
Šolak, Z. (2007). Health Care Finansing in the Russian Federation, Zbornik Matice
srpske za društvene nauke, 123, 245-261. Retrieved February 17, 2013, from
http://scindeks-clanci.ceon.rs/data/pdf/0352-5732/2007/0352-57320723245S.pdf
Totić, I. (2012). Neka pitanja u vezi sa finansiranjem zdravstvene zaštite u zemljamačlanicama Evropske Unije. Medicinski glasnik, 17(43), 54-68. Retrieved February 17,
2013, from http://www.cigota.rs/sites/default/files/04_43_42_56.pdf
Vaughan, E.J., & Vaughan, T.M. (2000). Fundamentals of Risk and Insurance.
MATE, Zagreb.
Vidojević, J. (2011). Development and Directions of the British National Health
Service Reforms. Proceedings: Social Reforms – Contents and Results. Faculty of
Political Sciences, University of Belgrade, 292-307. Retrieved February 15, 2013, from
http://www.fpn.bg.ac.rs/wp-content/uploads/2011/04/Socijalne-reforme.pdf
Wiening, E.A., Rejda, G.E., Luthardt, C.M., & Ferguson, C.L. (2007). Personal
Insurance. American Institute for Chartered Property Casualty Underwriters/Insurance
Institute of America. Malvern, Pennsylvania.
World Bank (2012). Report No. 66253-BA. Bosnia and Herzegovina: Challenges
and Directions for Reform – A Public Expenditure and Institutional Review.
Retrieved
February
22,
2013,
from
http://siteresources.worldbank.org/INTBOSNIAHERZ/Resources/
BHPEIR2012IzazoviPreporukeZaReforme.pdf
Zrinščak, S. (1999). Health Policy Systems in the World: Basic Characteristics and
Current. Revija za socijalnu politiku (online), 6(1), 3-19. Retrieved January 24, 2013,
from http://www.rsp.hr/ojs2/index.php/rsp/article/viewFile/312/897
Volume 5 Number 1 Spring 2015
105
�
Dublin Core
The Dublin Core metadata element set is common to all Omeka records, including items, files, and collections. For more information see, http://dublincore.org/documents/dces/.
Extent
The size or duration of the resource.
2700
Title
A name given to the resource
Possibilities of Development of Private Health Insurance in Bosnia and Herzegovina
Author
Author
Kozarević, Safet
Nuhanović, Senija
Hrnjić, Irnela
Abstract
A summary of the resource.
Abstract: Increased rise in costs of healthcare in the last five decades has rapidly increased interest in the functioning of healthcare systems within every country. The reasons for growth in healthcare costs are related to demographic changes, technology advancement, increased number of educated persons, emergence of new diseases, etc. Financing the risk of poor health is mainly organized through programs of social and private health insurance. Regarding the management of the risks of poor health in Bosnia and Herzegovina (BiH), the social health insurance system is the basic solution for the population. However, in BiH, as in other countries in the world, the system of social insurance has become unfeasible and it is necessary to search for new solutions, that is, to reform the system. The research subject in this paper is private/voluntary health insurance offered by insurance companies, which can be an efficient addition to social insurance in BiH. It has become present on the market of private insurance in BiH only recently, so its share in the total premium of private insurance is still minor. Therefore, a primary research was conducted on the possibilities for its development as well as on the need and acceptance by the users of healthcare services. Besides, there was a need for examining the performance of the existing system of social health insurance, based on the principles of Bismarck’s model of financing, and recognizing its disadvantages. By identifying and eliminating obstacles for development of voluntary health insurance, it is possible to improve performance of the existing system of health insurance in BiH.
Publisher
An entity responsible for making the resource available
International Burch University
Date
A point or period of time associated with an event in the lifecycle of the resource
2015-01-15
Keywords
Keywords.
Article
PeerReviewed
HN Social history and conditions. Social problems. Social reform