Armenia`s ministry of health establishing State Health Insurance Fund

ArmInfo. The Ministry of Health of Armenia proposes to disband the State Health Agency and establish a State Health Fund. The draft resolution of the Government of the  Republic of Armenia has been posted on the  unified portal of legal acts. It should be noted that according to  the Concept on the introduction of General Health Insurance (GHI),  the collection of funds for GHI, determination of the amount of  contributions and expenses will be carried out by this Fund, the  chairman of the board of which will be the Minister of Health of the  Republic of Armenia.

The authors of the draft law remind that the State Health Agency was  established in 1997 with the aim of more efficient use of financial  resources provided from the state budget of the Republic of Armenia,  including medical care and services provided under state orders  envisaged by the state target programs of healthcare of the Republic  of Armenia.

Meanwhile, at this stage, within the framework of healthcare reforms,  as well as the introduction of the IUS, the Ministry of Health  proposes to terminate the activities of the State Health Agency,  which operates within the structure of the Ministry of Health, and to  create a state fund for compulsory medical insurance.  , the document says.

The draft proposes to create a State Health Fund, determine the  authorized state body for managing the fund, appoint an acting  executive director of the fund and give relevant instructions to the  Minister of Health of the Republic of Armenia to organize work on the  creation of the fund. In addition, the draft proposes to approve the  charter of the fund, which, in accordance with the Law ,  defines the goals of the fund, powers, provisions on the property of  the fund, the bodies of the fund and their powers, the procedure for  making decisions in the fund, amending the charter, as well as other  requirements imposed by law on the charter of the fund.

The costs of establishing the Fund are estimated at 990 million  drams, of which 665 million drams will be redistributed from the  funds allocated for measures to implement comprehensive health  insurance, and the rest will be covered by the funds released from  the liquidation of the State Health Agency.

On February 2, 2023, the Armenian Cabinet approved the Concept for  the introduction of the IUD proposed by the Ministry of Health,  according to which the introduction of the system was planned for the  next 4 years. 2023 was considered as a year, and  2024-2026 were called the with the full introduction  of the IUD in 2027.

According to the plan, the implementation phase of the system should  begin in July 2024. And despite the fact that in early July 2024 the  World Bank announced its readiness to provide the RA with a $110  million loan to support the "Ensuring Universal Health Coverage"  program, the introduction of the IUD was postponed until January  2025. On November 1 last year, the Minister of Finance of Armenia  Vahe Hovhannisyan made it clear in parliament that the introduction  of the IUD was once again postponed, but this time for an indefinite  period, stating that there was no corresponding expenditure item in  the draft budget for next year. "We will be guided by our  capabilities," the RA chief financier said.

The draft law "On Amendments and Additions to the RA Law "On General  Health Insurance" developed by the Ministry of Health and posted on  the unified portal of legal acts in January of this year stated that  the IUS is planned to be introduced in stages, with 2024-2025  designated as the "preparatory stage", and from the moment the law is  adopted and the following year of its entry into force, the IUS  system will be implemented in full. It was noted that it will provide  equal coverage for all insured persons, regardless of solvency and  social status (differences may only be due to age and gender  characteristics of service). At the same time, along with the IUS,  voluntary health insurance will be in effect, including services not  included in the basic and minimum packages. Monthly payments in favor  of the insured person will range from 10,000 to 13,700 drams.

It was also noted that the funds of the VMS Fund budget will be  formed from insurance premiums paid by payers of insurance premiums,  additional deductions from the state budget, funds collected from  individuals and legal entities in accordance with the law for harm  caused to the health of the insured person, when the costs of medical  care of the insured person are made at the expense of the Fund's  budget, not prohibited by law in other ways. In addition, in order to  stabilize the Fund's budget, cover long-term insurance risks,  long-term equalization of expenses for comprehensive insurance, and  also to pay bonuses to insured persons, a reserve fund of the Fund  will be created, which is formed through annual deductions in the  amount of ten percent from the Fund's budget. It is planned that the  annual audit of the Fund's financial statements will be carried out  by an external independent internationally recognized organization,  which is part of the 10 largest audit networks by the level of annual  gross income.