Weatherhead Health Economist assists World Bank in Transforming Croatia's Health Care System | Weatherhead

Weatherhead Health Economist assists World Bank in Transforming Croatia's Health Care System

Posted 10.20.2004

Avi Dor, Case Western Reserve University health care economist from the Weatherhead School of Management, joined the World Bank team a year ago to help Croatia reform and find ways to balance government and private spending in its health care system.

Recently the Croatian government announced the major recommendations in five areas to reform health care that had been made by Dor and other World Bank team members.

While a graduate student at the Graduate Center of the City of New York in the 1980s, Dor had begun consultant work with the World Bank. His work in health care finance reform for the World Bank had taken him to the Ivory Coast, Peru, Jamaica and other developing countries.

When the World Bank approached him to become a part of the Croatian team with Akiko Maeda, the lead social sector economist for the region, and Sanja Madrazevic-Sujester and Ivan Drabek from the World Bank Office in Zagreb, Croatia, "I was excited and eager to do this work again," said Dor.

The team met with government leaders, public health advocacy groups, doctors and business leaders in the growing insurance industry to come up with recommendations presented to the Croatian government for consideration.

As Croatia moves to join the European Union, it undertook the reassessment of its health care system to understand what kind of impact the country will have as its people, goods and services move throughout Europe.

"Croatia has to show that they have reformed their economy and have a free market system in place before joining the EU. The EU has certain requirements about access to health care insurance that has to have some degree of a private market," explained Dor, and which challenged the fact-finders to find a way to balance the government support with supplementary private insurance.

Dor said that Croatia had established its health care system in 1993 to provide universality and solidarity to a system that had been torn apart by civil war and the country's split from Yugoslavia. Sweeping health care reforms came in 2002 with the Health Insurance Law that limited coverage under the Croatian Institute for Health Insurance (HZZO). The reforms increased revenues from health care through new co-payments for selected services and a voluntary supplemental health insurance plan that covered basic services.

Under HZZO, Croatians contributed to the system on their ability to pay and in return received a set of basic health services as needed.

Croatia, like other European countries with an aging population, faces increased health care costs associated with the elderly, according to Dor. Croatia spends approximately 15 percent of budget on health care-an amount that is more than other comparable developing countries pay for similar health care.

Dor said the team looked at how to balance a well-maintained health care system with the increasing and competitive options from the private sector that has the potential to leave the government subsidizing the health care of its poorest and most needy citizens who cannot afford the complimentary insurance.

While Dor said the country was on the "right track," the team encouraged the government to take actions in five areas to tighten up the system. The Croatia Health Finance Study called for the recommendations to:

  • Improve the budget planning and fund management by keeping closer account of the arrear payments that the government makes to health care providers and to make budgetary allowances for them. They also called for an evaluation of financing health care subsidies through general revenues and to include these, too, in a budget plan.
  • Examine and evaluate the combined effects of increased co-payments, the introduction of a supplemental health insurance plan and narrowing of exemption status on beneficiary access. "Co-payments should also be re-designed to discourage unnecessary use of health care, but not to be a barrier to accessing appropriate care," said the fact-finders.
  • Boost quality and efficiency through performance-based contracts with health care providers and strengthen HZZO's capacity to garner health services while reforming the payment system. This would also entail investing in new technology that provides safer yet more cost effective services.
  • Direct more resources into constantly monitoring and evaluating the system through household and facility surveys of the citizen's perception of the health care system.
  • Devolve health care responsibilities from the central government to local governments.

"This was a very exciting opportunity because of the historical

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