ArmInfo. The healthcare sector of Armenia needs additional resources in the amount of 150 billion drams and there is no alternative to the introduction of a new type of payroll tax. This was stated by the initiator of the "health tax", the Minister of Healthcare of Armenia Arsen Torosyan during a live broadcast on his Facebook page.
"Today we are trying to solve the issue of medical health care for 3 million residents of Armenia. I am saying this to clarify the scale of the issue," the Minister of Healthcare noted. According to the head of the Armenian Ministry of Healthcare, today the Armenian healthcare system is distorted, the state pays for the treatment of one part of the population, and the population pays for the second half. In this regard, the Minister referred to the experience of the advanced countries of the world. For example, in Denmark, where the Minister of Health is present today to participate in the second session of the 27th Standing Committee of the World Health Organization (WHO) in the European Region, unlike the Armenian health system, 85% of healthcare costs are covered by state health funds, and only 15% are paid by citizens and mainly for dental services.
The Minister recalled that according to the draft state budget for 2020, the budgetary allocation for the health sector will amount to approximately 109 billion drams. They cover a range of services for a specific group of citizens. Meanwhile, many continue to pay for their treatment from their own pockets. But, as the calculations of the Ministry of Health show, to solve the health issues of all citizens of the country, an amount of approximately 250 billion drams is required. "The question is where to find an additional 150 billion drams," the minister asks, "there are 2 mechanisms and the first of them is to request these funds from the budget. Another option is to find an additional source of financing. In any case, these funds should be centralized in one place and spent accordingly, "he stressed.
Calculations of the Ministry of Healthcare showed that a new tax could become a source of additional financial resources in the amount of 150 billion drams - a 6% tax on the salary of the working population of Armenia. Moreover, as the minister explained, it is possible if, as part of the medium-term spending program for 2020-2022 the sector's budget annually increases by 10-20 billion drams, then in 2022 a tax of not 6%, but 4% of the salary may be established. "But, the fact that Armenia will have to attract additional funds is inevitable," he said. The head of the Ministry of Healthcare also commented on why the ministry wants to establish a new tax in the form of deductions of certain percentages of salaries, rather than a fixed amount, as is the case with voluntary health insurance. "I emphasize once again that this is not a system of voluntary medical insurance, but a system of universal social security for the total solution of health issues for the entire population of the country and there is no alternative to establishing a new type of tax. Being an inclusive, social state, we must take care of citizens who currently do not have a permanent source of income. It can be everyone, our friend, our relative, " Torosyan said.
Arsen Torosyan insists that introducing universal health coverage in Armenia is an objective necessity. According to him, given the incomes of the population of Armenia, health care costs are mostly disastrous and lead to impoverishment of citizens. Often people get into a debt burden - they take loans, sell real estate to pay for treatment, and the proposed universal health coverage will make these expenses more inclusive, he said. "The proposed system is a system of social security, not development of financial markets," the head of the Ministry of Health said. As a result, according to Torosyan, it should cover everyone - working and not working citizens, otherwise the system will continue to be distorted. "I am ready for a polemic on the topic with any expert in any format," he assured. According to the minister, the project "On Approving the Concept of Implementing Universal Health Coverage in the Republic of Armenia", posted on a single portal of legal documents e-draft.am, should be considered as a proposal, but not a final decision. "Nevertheless, we believe that this is the best solution, or at least, on the basis of which we will find this solution, since the basis of this proposal is an analysis of all the experience of Armenia over the period of its independence, the best international experience and the reality, we live in, "he stressed.
To recall, according to the draft concept, the Universal Health Coverage (UHC) will cover the entire population within the framework of the established basic package of services, which will be differentiated depending on age and gender. A special UHC Fund will be appointed by the "regulator" to review all the principles of the process of providing state-guaranteed medical assistance to the population, as well as the implementation of procurement functions (including payment of compensations, revision of the tariff for services, selection of a service provider). The Minister of Health will head the Council.
According to the rationale for the document, the introduction of the UHC promises an increase in income not only to medical organizations, but also to the state treasury. So, according to the calculations of the Ministry of Health, the turnover of medical facilities will increase 2.5-fold. As for the state budget revenues, if in 2018 revenues from hospital and non-hospital services amounted to 82 billion drams (payments on taxes and state duties amounted to 14.4% or 11.7 billion drams), then according to preliminary estimates by experts of the Ministry of Healthcare, in addition to revenues in the amount of about 122.8 billion through the "health tax", the state budget in the form of taxes and duties as a result of the provision of medical services will make 32.7 billion drams. The process of introducing the UHC itself will require 229.1 billion drams. According to preliminary estimates by the Ministry of Health, the <health tax> will not become an additional burden for more than 41% of the working population (those who have a monthly income of 150 thousand drams or more). For the remaining 59% of employees, the effect of the new type of tax, according to the authors of the document, will be mitigated by the introduction of a flat taxation scale. It is noteworthy that the authors of the concept of the UHC either intentionally mislead the reader, or by mistake, say that Armenia will pass to income tax at a rate of 20% as early as 2021. And on the basis of this, they considered that for those who receive a "minimum wage" the tax base will decrease by 4%, and then "establishing a health tax of 4-6% will not have a significant negative impact on the employee's income." In fact, if a new tax is nevertheless introduced in 2022, the accountant will deduct funds from the employees' salaries at the aggregate rate according to the following scheme: 21% income tax, + 5% of payments under mandatory pension system,+ 6% health tax, + payments to the Fund of 1000 AMD.