CSC December’s Members Meeting
23.12.2018
CSC December’s Members Meeting
On December 20, 2018, Mr Adam Barecki participated in December’s members monthly meeting of the Cyprus Shipping Chamber. It was the last meeting in year 2018. As usual, the meeting began with a summary of Chamber’s activities in December. The summary was made by Mr. Andreas Neophytou, Vice-Pre
sident of the Chamber.
The second part of the meeting was devoted to the implementation of the reform of health care for which Cyprus has been waiting for a long time. For the meeting there was a presentation by Ms. Lena Panayiotou, Director at Industrial Relations and Social Policy Department and Mr. Theodoros Giovanni, Industrial Relations Officer of the Cyprus Employers and Industrialists Federation (OEB), entitled: ” The Cyprus National Health System Law – In a Nutshell”.
The Cypriot Parliment voted unanimously to introduce the National Health Insurance System (NHIS), which will transform the existing public health care system. The NHIS will be a universal health care system, financed throught indyvidual, employer and government contributions, and is due to be fully rolled out by June 1, 2020.
The NHIS will generally be free to users, with small co-payments for certain services, subject to an annual cap. Currently, the public health care system provides certain services for free or for a small fee to different population categories, depending mainly on income. There is, hoverer, no dedicated source of founding for the sysytem or central oversight of the provision of services. Instead, the system is only partially funded directly from central government revenue, leaving patients to make up the difference.
As a result, Cyprus currently has the highest share of out-of-pocket health care expenditures in the European Union (EU), at 50% of total health care spending versus an EU average of 15% (2014 OECD data), as well as one of the lowest public health expenditure levels in the EU, at only 3% of GDP in 2014. Total health care spending in 2014 equaled 7% of GDP, with 3% based on government spending (WHO data). The NHIS is an attempt to redress this impalance and is aimed at creating a financially viable system that reduces point-of-service user costs for health care.
Important NHIS elements include:
1. it will be based on a single-payer health care system overseen by the Health Insurance Organization (HIO), established in 2001.
2. Patients will have the freedom to choose their health care provider, including general practitioners (GPs) and specialists, from those providers registered with the HIO.
3. Funding will come from employer and employee contributions and from the state, pensioners and the self-employed on annual income up to 180,000 EUR. The full rate will not apply until March 1, 2020. Transitional rate (in parentheses below) will take effect from March 1, 2019:
– employers – 2.9% (1.85%)
– employees and pensioners – 2.65% (1,7%)
– self-employed – 4% (2.55%)
– gobernment contribution – 4,7% (1.65%)
4. Service users will have to make small copayments for certain services, capped between 75 EUR and 300 EUR per year, depending on household income.
5. Coverage for certain NHIS services, such as visits to GPs and specialist, laboratory tests and medications will not be operational until June 1, 2019, with the remaining services expected to be fully implemented by June 1, 2020.
6. Health care benefits will include a standardized basket of medical services, including hispitalization, surgery, pharmaceuticals, general and specialist medical care, and laboratory services.
7. HIO will be responsible for managing the NHIS with the addition of patients’ representation on the HIO board of directors.
The new system will mean higher payroll costs for both employers and employees. However, if the system is rolled out as intended, it should reduce out-of-pocket spending.
The role of private insurance will be directly impacted by the creation of a national insurance fund. Out-of-pocket spending for health care benefits has made employer-provided supplemental healh insurance a popular benefit.But private health insurance may still have a significant role in the market, depending on the regulations developed by HIO for standard and supplemental benefit coverage.
