A new analysis by the World Health Organization for Albania reveals that out-of-pocket payments for healthcare are a major source of financial hardship for people in Albania. 

About 8% of households are impoverished or further impoverished after paying out-of-pocket for health services, and 12% of households experience catastrophic healthcare expenditures, says the recently published study. 

Cash expenditures on health services are considered catastrophic by the WHO as they cause them to leave their basic living needs unmet. The study says that financial protection in Albania is weak compared to many other European countries. 

In 2015, one in eight households made catastrophic out-of-pocket payments, with payments concentrated in the poorest quintile. Levels of unmet need for health care are also high. The lack of financial protection can be attributed to low levels of public health spending and weaknesses in the following aspects of coverage policy. 

The insurance covers only two-thirds of the population 

The way how to benefit from the entitlement to Compulsory Health Insurance Fund (FSDKSH) means that FSDKSH covers on average only about two-thirds of the population. Uninsured people have access to a very limited range of publicly funded health care; they are also more likely to be poor, from minority groups and living in deprived areas. 

Efforts to strengthen financial protection and reduce unmet need should begin by depriving FSDKSH of entitlement to benefits in order for DIFKSH to automatically cover the entire population. Linking the right to pay contributions is particularly challenging given Albania's large informal sector.

FSDKSH does not cover dental care for adults. Lack of dental care coverage results in high levels of unmet need. 

FSDKSH coverage is limited by a complex system of user fees, which are particularly high for outpatient drugs. Outpatient medications are the main driver of financial difficulties, reflecting deficiencies in coverage and inadequate regulation. The growing role of outpatient drugs in fostering financial hardship is worrying due to the lack of mechanisms to protect poor people. Many people are not eligible for publicly funded outpatient drugs because they are not covered by the FSDKSH.

Also, outpatient medicines covered by FSDKSH are subject to high co-payment rates and there are no exceptions that are clearly targeted at poor families, nor is there an annual co-payment limit. 

To improve financial protection, international experience demonstrates the following protective features of the coverage and co-payment policy for outpatient prescriptions: the use of low fixed co-payments instead of percentage co-payments; exemption from co-payments for low-income families; and an annual income-related limit covering all co-payments. 

Attention should also be paid to how drugs are selected for coverage and to ensure that doctors, pharmacists and people can dispense prescriptions, distribute and use the cheapest alternatives.

High out-of-pocket payments due to low public spending 

Informal payments are a problem in public outpatient and inpatient institutions and cause financial difficulties. Their informal nature makes it impossible to provide protection for poor people. They also add to the complexity and impair transparency in the health system. 

Strengthening financial protection will require additional public investment in the health system and a greater focus on poor families. Low public spending on health (less than 3% of GDP in 2016), high reliance on out-of-pocket payments (58% of actual health spending in 2016), significant deficiencies in coverage and widespread payments informal are the main factors that undermine financial protection. 

Any additional investment in the health system should be used to further extend the FSDKSH benefits to the entire population, to find ways to improve access and financial protection for poor families and frequent users of health services ( for example, people with chronic diseases) and improve transparency. Better use of resources will also help.

(Source: Monitor)