Estonia's healthcare system is based on solidarity-based health insurance. Two-thirds of healthcare revenues come from the social tax paid by working people. Healthcare costs have tripled compared to 2010 because services have become more expensive.
The report presented on Wednesday took into account that defense costs remain high and no new money can be allocated to healthcare. The principle of solidarity is key – the healthy pay for the sick, the young for the elderly. The report offers three possible scenarios up to 2035.
The first scenario "Digital Hope" strongly invests in digital solutions and health technologies. It begins with a €200 million investment in the Health Insurance Fund to buy time for other measures to take effect. Hospital and family doctor information systems will be integrated, and AI decision-making tools and automatic documentation will be created.
The second scenario "Market Healthcare" increases the role of private insurance. People's own contributions increase, but the Health Insurance Fund's costs decrease. Initially, this brings additional money into the system, but without an increase in state contributions, public healthcare weakens. Quality and access disparities between population groups grow.
The third scenario "Too Little, Too Late" is the worst. The state waits and hopes the situation will improve on its own. Funding remains at the current revenue base, but reserves dwindle. The quality and availability of services decline sharply.
The key question for all three scenarios is how strong the solidarity principle should be. A decision must be made whether to expand the tax base or increase the role of private insurance. The impact of investing in digital solutions is difficult to predict.
The report suggests four possible solution paths: new health taxes, expansion of private insurance, investment in digital solutions, or value-based healthcare models. Investing in digital solutions may bring significant long-term savings but requires large investments.
The main reasons for the growth in healthcare costs are rising medical salaries and increased use of services. Salary increases have significantly reduced the emigration of healthcare workers. Population aging and service utilization are also reasons for cost growth.
In Estonia, healthcare costs account for 7.5% of GDP, while the European average is 10.2%. If Estonia's healthcare funding were at the EU average level, Estonia would have approximately one billion euros more each year. The growth in healthcare costs has led to expenses exceeding revenues by up to €100 million annually.
Private insurance in Estonia already covers about one-tenth of employees. The most frequent users of private insurance are highly educated people aged 25-39 in good health.