The model with involvement of private insurance companies to medical insurance seems to be quite viable, – partner at “Spenser & Kauffmann” Attorneys at Law

Today we expect further consultations, related to possible scenarios of further financing of Ukrainian healthcare. One of these scenarios is a draft law № 4981 of 14.07.2016 was recommended by the steering committee of the Verkhovna Rada of Ukraine to approve as a basis.

The document assumes, that the employer will charge for a mandatory medical insurance. The insurance payment will be annually approved by the Verkhovna Rada. The budget will be formed in bank accounts. The authorized body will monitor their use. Levy payer will sign the insurance services agreement with the private insurance company which further will pay for the patient’s treatment.

Forbes asked the Partner at “Spenser & Kauffmann” Tatiana Daniltseva what mandatory medical insurance will bring to Ukraine.

“This option will allow dispersing funds, received from the payers (employers, private entrepreneurs and local governments) between private and governmental facilities”, – stressed Tatiana Daniltseva.

According to Ms. Daniltseva, such a model, compared to others, has certain advantages. First and foremost, it is more competitive for the market as it foresees many customers (payers) and sellers (medical and insurance services), while other models has one subject (fund or state body) who takes decision to purchase of certain medical services as well as to finance certain healthcare facility.

“Secondly, the availability of the only one buyer is a ground for corruption component, as every seller of services will apply any possible measures, including illegal ones, to catch the buyer. Thus, there are no guarantees that ultimately, the best medical services provider will be chosen”, – stresses Ms. Daniltseva.

The history of our government has demonstrated that the concentration of the funds in a single pair of hands causes sustainable corruption schemes. Thus, the model with involvement of private insurance companies to social insurance medicine seems to be quite viable. Therefore, it carries a number of risks.

 For instance, in case of insolvency of the bank or of the insurance company with insurance funds, the patients will remain unprotected. “To eliminate this risk, the draft law №4981 foresees establishment of the Guarantee Fund for mandatory social medial insurance.  Therefore, as we can see from the experience of compulsory motor TPL insurance, in case of the insurer’s insolvency, his clients have to wait their payments from Motor Insurance Bureau of Ukraine for years, which is unacceptable for medical insurance and adequate healthcare system ”, – stressed Ms. Daniltseva.

Therefore, according to Ms. Daniltseva, with a transparent and careful regulatory control, the risks of this model can be reduced to minimum.  For this, it is necessary to approve the list and the volume of medical services on the legislative level, as well as the conditions of the insurance contracts (including the list of exceptions), special requirements to the insurance companies (including the availability of assistance), and requirements to the assets to place funds of insurance reserves of a mandatory medical insurance etc.

“As for the problem of another guarantee fund, experience of Deposit Guarantee Fund or Motor Insurance Bureau of Ukraine allows a legislator to learn a lesson from their mistakes and to improve the functioning of payments guarantee system”, – says Tatiana Daniltseva