Ukraine’s Health System: Time for Change

April 6, 2015

Qimiao Fan, World Bank Country Director for Belarus, Moldova and Ukraine Zerkalo Nedeli weekly, Ukraine

In spite of some progress, health outcomes remain very poor in Ukraine. On average, Ukrainians live approximately eleven years less than other Europeans. About 80 percent of these “excess deaths” compared to EU occur in relatively young age, between 15 and 60. The main killers are non-communicable diseases, such as cardiovascular diseases and cancer. About 85 percent of all deaths in 2012 were linked to cardiovascular disease, cancer and external causes, including accidents and poisoning.

The poor health outcomes are due to low health awareness in the population, high prevalence of tobacco and alcohol dependency, and more importantly, failure of the existing health services to prevent, detect, and treat diseases effectively. The problem is not one of physical accessibility. On the contrary, Ukraine has already an oversized number of hospitals and hospital beds, approximately 40 percent more than the EU average. The problem lies in inefficient allocation and use of resources, decades of neglected investments and rampant corruption in the sector.

Ukraine should and can do better protecting the health of its citizens. Actions are urgently needed to avert system collapse and to rebuild the institutional foundations at both the center and in the regions and municipalities to provide people in Ukraine with quality health services that they demand and deserve.

Given the many problems that need to be tackled, a comprehensive set of reforms that combine urgent interventions with medium-term improvements need to be implemented. The most crucial action is to gather all relevant resources, public and private, national and international, around a single purpose: getting Ukraine out of the current health system paralysis.

In the short term, the following actions are crucial:

  • First, ensuring under the current exceptional circumstances delivery of free care, including pharmaceuticals, to people in most acute need and against the most important diseases;
  • Second, removing legal obstacles for more efficient allocation of resources and to move from input-based, focused on number of hospital beds, to patient-based financing model;
  • Third, starting practical steps to eliminate extreme duplication and reduce waste by restructuring and consolidating facilities, as necessary;
  • Last, increasing transparency and accountability in the piloting of new payment mechanisms, or “purchasing”, and management arrangements in some primary care locations and hospitals.

As these short-term initiatives are being implemented, broader measures need to be prepared and then introduced. These include, among others: participation of the private sector in the health system; introduction of a new financing model, including public and private insurance schemes; and redefinition of a regulatory framework to determine the legal status of central and regional, governmental and professional bodies and institutions, including hospitals.

Like most Ukrainians, we at the World Bank believe that healthcare reform should be at the top of the Ukraine’s reform agenda, and stand ready to support the country in its efforts to revamp the system. The new "Serving People, Improving Health" Project, supported with a World Bank loan of US$215 million, will help Ukraine start to tackle the many challenges and improve service delivery in the health sector. 

The project aims to improve health service delivery at the local level with a focus on cardiovascular diseases and cancer, to spearhead critical reforms in the areas of public health, health financing, and information management, and to carry out complementary data collection and analytical activities for monitoring results.

To achieve these objectives, it is essential that the project is implemented with transparency and professionalism by the Government of Ukraine and Ministry of Health. Successful implementation of the project will help improve availability, quality and efficiency of health service delivery. Together with several other initiatives and broader reforms, it will help Ukrainians become healthier and live longer, more productive lives.

Qimiao Fan
World Bank Country Director for Belarus, Moldova and Ukraine

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