Improving the Cost-Effectiveness of Slovakia's Healthcare System

This Economic Brief examines the state of Slovakia's healthcare system, health spending and public health outcomes against the background of resource constraints and long-term fiscal sustainability considerations. While total public healthcare spending in Slovakia is below the EU average, long-term projections show a significant increase due to Slovakia's adverse demographic developments. Various studies suggest that life expectancy in Slovakia is low in relation to its level of healthcare spending, indicating potential room for improving the cost-effectiveness of the healthcare system and/or reducing mortality rates. The country's public hospitals are saddled with a high debt burden that partly stems from misaligned financial incentives for the hospitals' management. A government review of healthcare spending in the context of the Value for Money (VfM) project proposes concrete measures to improve hospital management, and further identifies significant potential cost savings in healthcare spending, e.g. in equipment procurement and pharmaceuticals. The diagnosis-related group (DRG) payment system introduced in 2017 offers the opportunity to transform hospital funding. Reducing bed capacities in acute care and shifting resources toward outpatient treatment could also improve cost-effectiveness. The Slovak healthcare system shows a low and falling number of GPs and nurses, which risks constraining the supply of healthcare services in the medium term. While some efforts to boost the attractiveness of the medical profession have been made, more decisive policy action seems warranted.