Hospital privatisation takes off with space and services

Rehabilitation and upgrading of public hospitals involves a financial effort worth two and a half billion dollars, according to World Bank estimates, as one and a half billion dollars are needed for building rehabilitation and one billion dollars for equipment acquisitions.

Due to the size of the above-mentioned amounts, alternative financing sources are necessary, as the state budget cannot possibly bear such costs alone.

By amending legislation, authorities aim at allowing the establishment of private hospitals, entitling doctors to officially cash payments for their services from private patients both in public and in private hospitals, instating private management in public hospitals, creating joint ventures between public and private hospitals, and establishing the system of private health insurance.

The economic outlook, the absence of a well-defined private market and of the private insurance system trigger Romanians’ scepticism regarding involvement of foreign investors in this process.

The first private health insurance policies in Romania were concluded in 1996 by the Tecuci-based clinic “Transilvania,” aiming at employees of the metallic construction plants from the neighbouring counties.

Monthly contribution amounted to 5,000 lei, while the contract was concluded for one year, while the patient benefited from medical assistance, drugs and admission in the two private hospitals of the clinic, based in Tecuci and Bacau, up to one million lei. Any amount exceeding this limit was paid by the patient.

Two years later, the first private system of health social security was launched in Bucharest, under the Medicover aegis, the group that managed to organise the primary medical assistance network in Central and Eastern Europe. The first contract beneficiaries were foreign citizens in Romania and several large companies that insured their employees.

The measures to be promoted by the Health and Family Ministry in order to support private insurance are: tax deductibility for private health insurance policies, overtax for people with taxable income exceeding a certain level – if they choose not to participate in the private insurance system, keeping the premiums for people who join the system while young, and freezing premiums for senior citizens.