Comprehensive Health Insurance Implementation Concept Approved: What Phases It Will Roll Out In

The Government of Armenia has approved the concept for implementing Comprehensive Health Insurance. Health Minister Anahit Avanesyan announced at the cabinet meeting that the adoption of the system is conditioned by the need to provide proper and timely services to every citizen requiring medical assistance, regardless of their ability to pay, gender, age, or place of residence.

International comparisons of the healthcare financing system in Armenia, along with observations on cost-effective programs, show that in the presence of adequate financial resources, the healthcare system operates efficiently and enables the registration of improving non-financial indicators, such as increased life expectancy and the decrease in maternal and infant mortality rates.

“However, when we examine the funding mechanisms that ensure these indicators, it is noticeable that Armenia has significantly lower public funding compared to many countries in Europe and Central Asia. Over the past 25 years, it has allocated 5.4% of the consolidated budget expenditures to healthcare or about 1.4% of GDP, which is at least four times lower than the average figures for similarly income-grouped countries,” she stated.

Insufficient financing has led to the fragmentation of service delivery systems, lower reimbursed prices than actual costs, and a lack of specialized medical personnel in the regions. The low level of financial accessibility has resulted in poor workload in medical organizations, with 12.6% of the non-poor population, 24.5% of the poor, and 49% of the extremely poor not visiting a primary care physician due to financial reasons.

The lack of state financial resources for healthcare and the uncontrollable decline in actual expenditures hinder the development of the system and the improvement of the quality of medical assistance and services. It contributes to the impoverishment of many families due to catastrophic healthcare costs, obstructs enhancements in the accessibility and financial affordability of medical assistance and services.

With 16.1% of household incomes directed to healthcare expenditures, Armenia exceeds global (12.7%) and regional (7.4%) averages. Approximately 9% of the population incurs healthcare expenses that exceed 25% of their consumer spending, leading to poverty for about 6% of them, one of the highest rates in the region.

From an international perspective, many countries have long implemented a mixed financing system for healthcare expenses which includes mandatory medical insurance. Their primary strategic challenge now is ensuring universal coverage for all segments of the population. In this context, Armenia should also adopt experiences from countries with effective healthcare systems, ensuring financial accessibility and protection for the population while receiving services included in the basic package, reducing catastrophic costs related to medical assistance, and the number of impoverished individuals as a result thereof.

The main goal of the implementation of Comprehensive Health Insurance is to ensure financial accessibility to basic health services for all population groups. The concept should serve as a basis for consolidating the comprehensive measures carried out by the Ministry of Health and for developing laws related to Comprehensive Health Insurance, along with other legislative changes to ensure the phased implementation of Comprehensive Health Insurance starting in 2024.

The primary result of implementing Comprehensive Health Insurance is expected to be improvements in morbidity and mortality rates, an increase in life expectancy, and a reduction in the number of people disabled due to health issues, which will contribute to the sustainable development of human capital and economic growth,” the decision draft states.

The work will commence in 2023, which will be a preparatory phase, and in 2024, there will be a group of citizens insured under the Comprehensive Health Insurance package. In 2025, the state will also include pensioners who will benefit from the entire range of services under the package. By 2027, mandatory insurance coverage will be extended to the entire population of Armenia.