The Health Sector in the Slovak Republic: Efficiency and Reform

IMF Working Papers, September 1, 2007

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Authors: Victoria Gunnarsson, Sergio Lugaresi, Marijn Verhoeven
Publication date: September 1, 2007
Purpose: Assess the financial situation of the health sector in the Slovak Republic; evaluate the efficiency of health expenditures and service delivery relative to the OECD and other new EU member states; suggest avenues for cost recovery and reform.
Main conclusion: The health sector of the Slovak Republic is plagued by financial problems and requires increased efficiency of health spending and improvements in the mix and quality of real health resources to turn around finances and achieve larger gains in health outcomes.

Overall health spending efficiency in Slovakia is on par with that of the OECD.
Substantial inefficiencies occur in the process of transforming intermediate health inputs into health outcomes.
Areas identified for efficiency gains:
- Containing the cost of drugs.
- Reducing reliance on hospital care.
While cost-effectiveness may be relatively high at present, its sustainability in the future is an issue.

Comparative approach: Evaluation against OECD and other new EU member states to identify relative strengths and weaknesses.
Diagnosis: Inefficiencies are concentrated in converting inputs (intermediate health resources) into final health outcomes, despite comparable aggregate spending efficiency to the OECD.

Enhance efficiency of health spending by:
- Containing drug costs.
- Reducing reliance on hospital care through alternative care models and resource reallocation.
Improve the mix and quality of real health resources to achieve larger gains in health outcomes.
Address sustainability concerns about current levels of cost-effectiveness to ensure long-term fiscal viability of the health sector.