| Health Financing Reform in Ukraine
FIGURE 1.2
Out-of-pocket spending as share of total current health spending in Ukraine and selected country groups, 2000–18 60 55 50 45 40 35 30 25 20 15
18
17
20
16
20
15
20
14
20
13
20
12
20
20
11
10
Ukraine High-income countries (Europe) Upper-middle-income countries (Europe) Low- and middle-income countries (Europe)
20
09
20
08
20
06
07
20
20
05
20
04
20
03
20
02
20
01
20
20
00
10
20
Percent of total health care spending
4
High-income countries (global) Upper-middle-income countries (global) Low-income countries (global) Low-income countries (global)
Sources: State Statistics Service of Ukraine (for Ukraine); World Development Indicators database; Global Health Expenditure Database. Note: Regional averages are population-weighted.
WHO Europe’s “capacity to pay” threshold increased from 11.5 percent to 16.7 percent.3 Catastrophic spending is heavily concentrated in the bottom consumption quintile. The PMG can also potentially address the large unmet need for health care, which has grown by a factor of 1.4 since 2009, to affect an average of 24.5 percent of households in 2017 and 2018, according to the State Statistics Service of Ukraine’s Household Living Conditions Surveys. In recent years, the political and technical processes for determining, updating, and budgeting the PMG have been marked by increasing discretion and decreasing transparency. In 2020, the Law on Financial Guarantees for Health Care Services 2017 was revised such that the PMG benefit package specification (including service pricing) is no longer voted on by the Parliament (Verkhovna Rada) and approved as part of the annual Budget Law but is instead approved at the discretion of the Cabinet of Ministers (CabMin). The rules for the technical development of the PMG are very broad, and the methodology of the Ministry of Health (MoH) for defining and updating the National Health Priorities on which the PMG is based is not made public, giving the MoH wide discretion in defining the scope of the PMG and preventing scrutiny of its decisions. In particular, PMG costing and pricing processes lack clear and transparent methodologies. A compounding challenge is the government-wide, medium-term budgeting process. This process was introduced in 2018 but suspended in 2020. As result, the CabMin did not approve the planned three-year horizon for PMG development. It could be argued that this decision was an appropriate pandemic response, providing the government with flexibility in a rapidly
