4. Paying for services
Adequate funding for health is important to manage the excess demands on the health system. This section considers how countries are PAYING FOR COVID-19 SERVICES. Health financing describes how much is spent on health and the distribution of health spending across different service areas. The section also describes who is covered for COVID-19 testing and treatment, whether there are any notable gaps (in population coverage and service coverage), and how much people pay (if at all) for those services out-of-pocket.
4.1 Health financing
On 16th of March, Ministry of Finance, together with the Ministry of Social Security and Labor, the Ministry of Economy and Innovation, the Ministry of Health and the Bank of Lithuania submitted a plan (1) to the Government (Plan for measures to boost the economy and mitigate the consequences of COVID-19 can be found here and here) (2). It is planned to allocate 10% the country’s GDP (about 5 billion Euros) for the implementation of the response measures. From those, 500 million Eur has been allocated to the health sector. This includes: 1) Purchase of PPE, reagents, medical and other equipment. 2) Additional funds for health care, including staff salary supplements. 3) Supplementary social security coverage for COVID-19 health care workers. 4) Additional funding for public authorities involved in emergency management, including staff salary supplements. 5) Faster and simpler public procurement necessary to protect public health in an emergency.
The funding for institutions, regardless of the extent of services they provide to patients, was not reduced during the lockdown. Payments were guaranteed during the quarantine under the so-called “1/12 rule”, which states that providers receive reimbursement on a monthly basis according to the annual contract with the NHIF. However, from 8th June, providers that have resumed service provision will continue to be reimbursed according to the 1/12 share of annual contract even if the actual volume of services provided is less; at the same time, providers that have not resumed services by 8th June will paid according to the actual volume provided.(3) This move was done to incentivise providers to resume the usual services to improve accessibility to essential and routine care.
From April 2020, NHIF has added a new group of tariffs to pay for remote specialist consultations, which match the price for face-to-face consultations. (8)
In the end of September, the Lithuanian government has signed up for the purchase of COVID-19 vaccine through the EC joint procurement mechanism, leaving an option for the government can have a say on contracts with individual vaccine producers (4). On 11th of November, the Government approved the proposal by the MOH to purchase a Sanofi Pasteur & GSK vaccine under a pre-purchase agreement, acquiring a loan of EUR 1.5 million. (7)
By the end of August, the Ministry of Finance together with the Ministry of Health has allocated 11 mln euros to municipalities to compensate municipal health providers for incurred COVID-19-related expenses and to cover the costs of provision of accommodation for persons who needed to isolate. Funther compensation will be decided by a special commission around mid-September. (5).
To compensate providers for the purchase of equipment necessary for infection control between 1st February and 30th June, reimbursement of 13.26 million EUR was paid to 410 institutions (out of the total 848 institutions and 453 institutions that applied for refund). The providers that received refunds include those directly providing services to COVID-19 patients (designated hospitals, institutions that created fever clinics, and ambulance services, n=97); providers of non-covid services (primary health care, dentistry and other health services, n=303); as well as further 10 institutions Compensation was also granted to ten of the seventeen institutions under the MOH, which declared that they had incurred additional costs in acquiring the personal protection and disinfection equipment necessary to ensure the performance of the functions assigned to the institutions.
Funds will reach the institutions as the second wave of coronavirus swings. They will alleviate the financial burden on institutions and help to provide the necessary tools for the provision of health care services more quickly. Payments to institutions were made by the National Center for General Functions on 19-20 October.
In November and December 2020 30 million EUR were spent on covid-19 infection control. The Government envisages to further increase spending, borrowing additional 50 million EUR to compensate health care providers for increased costs; the resources accumulated in the compulsory health insurance fund for 2021 are not sufficient to cover all the envisaged spending.
The budget for 2021 designates about EUR 1,083 million for the management of the negative consequences of the COVID-19 pandemic.
• EUR 573 million for sickness benefits, subsidies during downtime, benefits for both self-employed and jobseekers;
• EUR 230 million for grants, soft loans, partial interest compensation and other business support for companies affected by the COVID-19 pandemic;
• EUR 65 million is allocated to purchase of the COVID-19 vaccine;
• EUR 45 million for the Compulsory Health Insurance Fund to allocate to health workers’ increased compensation;
• EUR 80 million for the purchase of medical treatment and medical equipment, laboratory tests, etc.
• EUR 90 million for other different institutions involved in containing the negative effects of the COVID-19 pandemic, etc.