Major challenges ahead for Hungarian healthcare
The health sector in Hungary is facing its most serious crisis since the fall of the communist regime.
Péter Gaál and colleagues discuss the challenges and how to respond to them
Péter Gaál associate professor 1, Szabolcs Szigeti national professional officer on health policy and
health systems2, Dimitra Panteli researcher3, Matthew Gaskins researcher 3, Ewout van Ginneken
senior researcher 3 4
1Semmelweis University, Health Services Management Training Centre, Budapest, Hungary; 2WHO Country Office Hungary, Budapest, Hungary;
3Berlin University of Technology, Department of Health Care Management, Berlin, Germany ; 4European Observatory on Health Systems and
Policies, Berlin
Our recent review of the Hungarian health system laid bare
some of the major challenges it faces today.1Although
Hungary’s problems are not unique, their size sets this nation
of 10 million people apart. The country has some of the worst
health indicators in Europe, and public funding of its health
system, which has long been inadequate, is currently in decline.
Out of pocket expenses are high and the system encourages
informal payments. At the same time, the health workforce in
Hungary is shrinking because of migration of skilled
professionals, threatening the sustainability of the system. In
this article we look at some of the successes and failures of
recent health reforms and suggest a way forward.
System faced with poor population health
Since the collapse of the communist regime in 1989, Hungary
has built a mixed health system, based on a single payer, the
National Health Insurance Fund Administration (NHIFA), which
is funded from payroll contributions and general taxes (box 1).
The NHIFA contracts with local government owned providers
and pays for the services on the basis of diagnostic related
groups in acute inpatient care, weighted patient days in chronic
inpatient care, and a fee for service point system in outpatient
specialist care; primary care doctors get a fixed amount per
enrolled resident, adjusted by age. Although general practitioners
are meant to act as gatekeepers, payment incentives weaken this
role and use of hospital services is high. Between 1995 and
2008, non-diagnostic referrals to outpatient specialist care almost
tripled, and the number of hospital referrals per patient increased
by 66.5%.2Patients can consult a wide range of specialists
without referral, including dermatologists, otolaryngologists,
obstetricians, gynaecologists, ophthalmologists, oncologists,
urologists, and psychiatrists. Hungary had 12 outpatient contacts
per person in 2009, almost twice the European Union (EU)
average.3
The health sector has been struggling with an unfavourable
fiscal context and an ill and ageing population. Life expectancy
at birth in Hungary has consistently remained among the lowest
in Europe, trailing the European Union average by 5.1 years in
2009 (fig 1⇓). The improvements seen since 1993 have done
little more than ensure that the gap between Hungary and the
rest of the EU has not widened.
The main causes of death in Hungary are diseases of the
circulatory system, cancer, and conditions of the digestive
system—a pattern that has remained essentially unchanged since
2000 (table 1⇓).4The main culprits are the traditionally
unhealthy Hungarian diet, alcohol consumption, and smoking.
For example, 31.4% of the population aged over 15 years were
regular daily smokers in 2009, the highest among the EU
countries for which recent data are available. Unsurprisingly,
in 2009, the death rate from causes related to alcohol and
smoking was almost twice the average in the rest of Europe.3
The picture is more positive for infant and maternal mortality,
some avoidable causes of death, and especially mortality from
communicable diseases (table 2⇓). This is because Hungary has
managed to maintain and improve the well functioning
communicable disease control system, the compulsory child
vaccination programme, and the primary care network of mother
and child health nurses, which all date back to the communist
era.
Effects of harsh cost containment measures
The macroeconomic climate in Hungary has been shaped by
the efforts of successive governments to bring recurring budget
deficits under control. In the health sector, periods of cost
containment have alternated with periods of increased public
spending, complicating long term planning and investment
decisions. It has also led to a substantial overall drop in public
expenditure on health, which fell from a high of 7.1% of gross
Correspondence to: E van Ginneken ewout.vanginneken@tu-berlin.de
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BMJ 2011;343:d7657 doi: 10.1136/bmj.d7657 (Published 7 December 2011) Page 1 of 8
Analysis
ANALYSIS
Box 1: Overview of healthcare financing in Hungary
During the communist era, Hungary had a highly centralised, tax funded health system based on the Soviet Semashko model, characterised
by the exclusive dominance of the state, a strong focus on specialist and hospital care, a low prestige primary care service, low paid doctors,
and widespread informal payment.
In 1989, a Bismarckian social health insurance system was introduced with compulsory, non-risk related payroll contributions pooled in the
Health Insurance Fund, administered by the NHIFA. Since the mid-1990s, the government has gradually regained more control over the
NHIFA. The autonomous body that supervised the NHIFA was abolished in 1998 and the contribution rate was lowered substantially. In
2009, general tax revenue became the dominant source of funding. In effect, the system has become a hybrid model, combining elements
of social insurance with an NHS-type system. Local governments are responsible for health service delivery and own most health facilities.
GPs are mostly private entrepreneurs and pharmacies are 100% privately owned. In 2011, the new government decided to take over the
local government owned hospitals and polyclinics from next year.
Box 2: Hungary’s health service delivery system
•Public health services are delivered through the National Public Health and Medical Officer Service
•Primary care comprises general practice services, dental care, out of hours care, and maternal and child care (through a nationwide
network of health nurses) and falls within the remit of the municipalities
•Secondary and tertiary care is shared among the municipalities, counties, the central government, and, to a lesser extent, private
providers. Hungary has followed the general European trend of reducing the number of acute hospital beds. Day care has been
fostered through regulations and special financing schemes, especially over the past 15 years
•Long term care is provided by the health and the social sectors
•Local governments are responsible for providing social care, which takes the form of cash and in-kind benefits provided mostly to
people who are poor or disabled
•Mental healthcare is integrated into the main health and social care systems
•Most dental services are available free of charge at the point of access, but the use of private dental care is widespread
domestic product in 1994 to 5.2% in 2009—whereas the
proportion grew in many other European nations (fig 2⇓).5This
decline may threaten the sustainability of universal coverage.
Any savings from increased efficiency in the health system have
been consistently diverted out of the health sector. The budget
for the National Health Promotion Programme in 2007, for
instance, was only a third of what it was in 2003.6
The most recent austerity package, which aimed to help Hungary
meet the Maastricht criteria for joining the European monetary
union, was enacted well before the global economic crisis hit
in the autumn of 2008. An increase in the unemployment rate
from 7.1% in early 2007 to 11.6% in early 2011 has led to a
decrease in contributions and further cuts in public spending.7
The macroeconomic climate remains unfavourable, and the
government must continue to observe tough deficit targets set
by the EU. Substantial increases in public spending on health
should therefore not be expected in the near future, despite
government declarations to the contrary.8
To offset falls in public expenditure, government has aimed to
shift part of the financial burden to patients by restricting the
benefit package (box 3). As a result, household out of pocket
spending increased from 16% of total health expenditure in
1995 to 25.2% in 2008. Drugs account for the largest amount
of out of pocket expenses (table 3⇓). There are standard tariffs,
and the NHIFA reimburses either a percentage (25-100%) or a
fixed amount. For fully reimbursed drugs patients have to pay
a flat fee of 300 forint (about £0.90; €1.05; $1.40) per package.
A sizeable share of out of pocket expenses also goes on informal
payments. These payments, which are made to doctors and, to
a lesser extent, other health workers for services that should be
free of charge, are a legacy of the communist era and remain
despite attempts to formalise them.9On average doctors earn
66-250% of their net official salary informally,10 with
obstetricians and surgeons receiving the most; a typical payment
for a delivery in Budapest is around 100 000 forint. Gratitude
is said to be the main motivating factor, but evidence exists that
patients are subject to a wide range of external and internal
pressures to pay.11
Health workforce crisis
The harsh cost containment programmes implemented since the
mid-1990s have had direct repercussions on the health
workforce, which mostly comprises salaried public employees.
Wage freezes and cuts have made jobs in healthcare less
attractive. Salaries have been falling as a share of the average
wage since 2005, and since the financial crisis struck in 2008
they have also decreased in absolute terms.12
Wages are a major driver for professional mobility in the EU,
and Hungary is no exception.13 In 2009, general practitioners’
salaries were 1.4 times the average Hungarian wage and
specialists 1.6 times the average, considerably lower ratios than
those seen in some other European countries. Unsurprisingly,
the number of doctors seeking higher pay abroad (mainly in the
UK, Germany, Italy, and Austria) is rising, making Hungary a
net donor country in terms of physician migration. Moreover,
the outflow of health professionals seems to be increasing
substantially while the inflow is diminishing. The number of
foreign nurses who registered to practise in Hungary in 2008,
for example, was 45% below that seen in 2005.14
Low wages, migration, reductions in capacity, and the ageing
of health professionals— 8.2% of practising doctors in Hungary
were aged over 61 in 200715—have taken their toll on the health
workforce, which fell from 129 000 in 2003 to 107 106 in
2010.16 Figure 3⇓shows that ratios of doctors and nurses to
population in Hungary are lower than the average for the EU.
It is not the current numbers of staff but the trend that is
alarming because it could worsen problems with workforce
distribution, especially in rural and remote areas. Large
disparities already exist by region, level, and type of care as
well as profession and specialty. Shortages exist in primary
care, anaesthetics and intensive care, radiology, emergency
medicine paediatrics, and neurology.17 In contrast, the per capita
numbers of dentists increased by 56% between 2000 and 2008.3
This can be explained by the better economic opportunities in
the private market and, perhaps ironically, by increasing
numbers of foreign patients coming to Hungary for affordable
dental treatment.18
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BMJ 2011;343:d7657 doi: 10.1136/bmj.d7657 (Published 7 December 2011) Page 2 of 8
ANALYSIS
Box 3: Services excluded from Hungary’s publicly funded health system
•Non-curative treatments for aesthetic or recreational purposes, such as plastic surgery
•Services that are not proved to improve health, defined as interventions not included in the International Classification of Procedures
in Medicine
•Treatment of injuries resulting from extreme sports
•Health services connected with professional sports
•Sex change operations (except correction of congenital anomalies)
•Abortion without medical indication
•Sterilisation without medical indication
•Manual therapy (physiotherapy, osteopathy, etc)
•Population screening for prostate specific antigen
•Medical examinations for certification and advice (such as for a driving licence or for forensic purposes)
•Detoxification of drunk people admitted with alcohol poisoning
•Occupational health services, including screening and examinations to assess risk exposure, but these have to be covered by employers
•Health services delivered by providers without NHIFA contract
•Drugs, medical aids, and prostheses, including dental prostheses, although a means tested exemption exists. Inpatient care includes
the cost of drugs
Responding to the challenges
The challenges facing the Hungarian health system are great.
Since more money is unlikely to be forthcoming, improvements
must be achieved through efficiency gains rather than increased
public spending. Successive governments have failed to
formulate a consistent legal and financial framework that would
provide a stable and predictable flow of resources for the health
system. However, a hypothecated tax on unhealthy foods
introduced in September 2011, although likely to provide only
small amounts of revenue, is a promising initiative.
The most important inefficiency is the lack of coordination
between healthcare providers within and across levels of care,
as well as between the health and the social sectors. Although
reforms have mainly looked at public sector solutions to these
problems, initiatives to privatise hospitals and to introduce a
competitive health insurance model have regularly entered the
debate. Parliament approved a plan to partly privatise the
management of the NHIFA and to entrust the coordination of
care to for profit companies in early 2008, but it was repealed
only months later after the public voted against user charges in
a national referendum. The current government has reverted to
a public sector approach and recently decided to nationalise the
12 hospitals of the municipality of Budapest. This measure has
been extended to all other local government owned hospitals
and polyclinics, which represents another major step towards
an NHS-type system.
Incentives for providers to work more efficiently are sorely
needed, as are measures to eliminate corruption. A care
coordination pilot from 1999 tackled these problems as well as
the lack of vertical integration between providers. It showed
promising results but was dismantled in 2008 (box 4).19 The
government would be well advised to build on the experiences
of such innovative models using combinations of better
coordination and bundled payments.
Action is also needed to deal with the crisis in the health
workforce. Although wage increases seem unlikely, other
strategies are available. When asked in a recent survey about
their reasons for leaving Hungary to work abroad, emigrant
doctors cited the working environment (such as terms of
employment, lower working hours, less administrative burden),
the future perspective of Hungarian healthcare, career
opportunities, and social prestige almost as often as higher pay.17
The government should consult the workforce to assess which
non-monetary incentives (study leave, vacation, flexible working
hours, access to training and education, occupational health
counselling, recreational facilities, etc) could make the health
professions more attractive.
Lastly, a more comprehensive approach to measuring system
performance would be beneficial.20 It could improve governance
by encouraging (or even requiring) the use of evidence in policy
decisions and by making the system more transparent and
accountable. Until now, such efforts have focused mostly on
financial performance and provider activity. Although the
NHIFA has been collecting detailed patient level data on use
of healthcare services and drugs since 1993, this rich dataset
has yet to be used extensively for monitoring and evaluation.
Not until such obvious deficiencies are overcome will there be
sustainable improvements in the performance of the Hungarian
health system.
Contributors and sources: PG, SS, DP, and MG have recently completed
the 2011 Hungary health systems review (HiT), which served as the
basis of this paper. EVG, DP, and MG have extensive experience with
health systems in Europe and especially in the new EU member states
through their involvement with the European Observatory on Health
Systems and Policies. PG is an expert on health policy and the
Hungarian health system; he was the lead author of the 1999 and 2004
HiT profiles. SS has worked as national policy officer in the WHO
Country Office in Hungary on health system and policies. EVG devised
the article and wrote the first draft, which was revised by PG and SS.
EVG, DP, PG, SS, and MG contributed to subsequent drafts. The last
draft was revised by EVG and MG. A revised draft was prepared by
EVG and PG. All have read and agreed with the final version. EVG is
the guarantor.
Competing interests: All authors have completed the ICJME unified
disclosure form at www.icmje.org/coi_disclosure.pdf (available on
request from the corresponding author) and declare no support from
any organisation for the submitted work and no financial relationships
with any organisation that might have an interest in the submitted work
in the previous three years. PG is an unpaid adviser to the state
secretary for health in the Ministry of National Resources and is an
unpaid member of his cabinet.
Provenance and peer review: Commissioned; externally peer reviewed.
1 Gaál P, Szigeti S, Csere M, Panteli D, Gaskins M. Hungary: health system review. Health
Systems in Transition 2011;13:1-266.
2Hungarian Central Statistical Office. Yearbook of health statistics 2008. Hungarian Central
Statistical Office, 2009.
3WHO Regional Office for Europe. European Health for All database (HFA-DB). www.euro.
who.int/hfadb (accessed May 2011).
4Ádány R. A magyar lakosság egészségi állapota, különös tekintettel az ezredforduló utáni
időszakra [The health status of the Hungarian population, with special reference to period
after the turn of the millennium]. Népegészségügy 2008;86:5-20.
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BMJ 2011;343:d7657 doi: 10.1136/bmj.d7657 (Published 7 December 2011) Page 3 of 8
ANALYSIS
Box 4: Innovative Hungarian care coordination system
A pilot care coordination system was introduced in 1999 to tackle the shortcomings of incentives in the existing payment systems. The
concept was that healthcare providers (either a hospital, a polyclinic, or a group of GPs) would take responsibility for the entire spectrum of
care of a population group (initially up to 200 000 people). Care coordinator organisations could collaborate with other providers to optimise
the treatment of their patients. They were assigned a virtual budget based on the number of people in the catchment area multiplied by a
risk adjusted capitation fee. If the total cost incurred during the year was lower than the virtual budget, the difference was paid to the care
coordinators and could be used for remuneration and investment. The project was criticised, mainly for lack of transparency and inequitable
distribution, and was abolished in December 2008 despite documented successes during its first few years of operation.
This paper was prepared in conjunction with the European Observatory on Health Systems and Policies (www.healthobservatory.eu).
5 Organisation for Economic Cooperation and Development. OECD health data: health
expenditure and financing. 2011. www.oecd.org/health/healthdata.
6 Ministry of Health. Tájékoztató az Egészség évtizedének népegészségügyi programja
2007. évi előrehaladásáról [Report on the progress of the implementation of the decade
of national public health programme in 2007]. 2008. www.eum.hu/archivum/eloterjesztesek/
egeszseg-evtizedenek-090921
7Eurostat. EU labour force survey. 2011 http://epp.eurostat.ec.europa.eu/portal/page/portal/
employment_unemployment_lfs/introduction.
8 Government of the Hungarian Republic. A Nemzeti Együttműködés programja [The
programme of the National Cooperation]. 2010. www.parlament.hu/irom39/00047/00047.
pdf.
9 Gaál P, Jakab M, Shishkin S. Strategies to address informal payments for health care.
In: Kutzin J, Cashin Ch, Jakab M, eds. Implementing health financing reforms: lessons
from countries in transition. WHO, European Observatory on Health Systems and Policies,
2010:327-61.
10 Gaál P, Evetovits T, McKee M. Informal payments for health care: evidence from Hungary.
Health Policy 2006;77:86-102.
11 Gaál P. Informal payments for health care in Hungary. [PhD thesis]. London School of
Hygiene and Tropical Medicine, 2004.
12 Hungarian Central Statistical Office. Household statistics. 2011. http://portal.ksh.hu/pls/
ksh/docs/eng/xstadat/xstadat_annual/i_zhc004.html.
13 Hungarian Central Statistical Office. STADAT tables, employment. 2011. http://portal.ksh.
hu/pls/ksh/docs/hun/xstadat/xstadat_eves/i_qlf002.html.
14 Wismar M, Maier CB, Glinos IA, Dussault G, Figueras J, eds. Health professional mobility
and health systems: evidence from 17 European countries. WHO, European Observatory
on Health Systems and Policies [forthcoming].
15 Ministry of Health. Tájékoztató az egészségügyben dolgozók létszámhelyzetének
alakulásáról [Report on the trends of the numbers of health professionals]. Ministry of
Health, 2009.
16 National Institute for Strategic Health Research. Összefoglaló tájékoztató az
egészségügyben dolgozók létszám- és bérhelyzetéről 2010 IV. negyedév [Summary
report on the number and wages of health professionals in the final quarter of 2010].
2011. www.eski.hu/new3/adatok/berstatisztika/OSAP1626-eves-CD/index.htm.
17 Eke E, Girasek E, Szócska M. From melting pot to change lab central Europe: health
workforce migration in Hungary. In: Wismar M, Maier C, Glinos IA, Dussault G, Figueras
J, eds. Health professional mobility and health systems: evidence from 17 European
countries. WHO, European Observatory on Health Systems and Policies [forthcoming].
18 Kámán A. Fogászati turizmus mint az egészségügyi turizmus húzóága [Dental tourism
as the driving force of health tourism]. Association of Leading Hungarian Dental Clinics
conference presentation, Utazás, 4-7 March 2010.
19 Gaál P. Health care systems in transition: Hungary. WHO Regional Office for Europe,
2004.
20 Gaál P, Szigeti S, Gaskins M. Responsibility and accountability in the Hungarian health
system. In: Rosen B, Israeli A, Shortell S, eds. Accountability and responsibility in health
care—an emerging global issue. World Scientific [forthcoming].
Accepted: 01 November 2011
Cite this as: BMJ 2011;343:d7657
© BMJ Publishing Group Ltd 2011
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BMJ 2011;343:d7657 doi: 10.1136/bmj.d7657 (Published 7 December 2011) Page 4 of 8
ANALYSIS
Tables
Table 1| Main causes of death (standardised death rate/100 000) in Hungary and the EU3
Hungary
EU (2009)20092000
232.8421.2521.0Diseases of circulatory system
86.4214.8226.9Ischaemic heart disease
55.590.8141.7Cerebrovascular disease
171.9243.2268.2Cancer
37.365.965.0Trachea/bronchus/lung
23.528.132.5Breast (female)
3.35.97.3Cervical
31.565.687.0Diseases of digestive system
13.741.360.1Chronic liver disease and cirrhosis
44.144.340.3Respiratory diseases
29.529.622.2Diseases of nervous system and mental disorders
12.417.917.3Diabetes
37.859.082.2Injuries and poisoning
10.421.829.2Suicide and self inflicted injury
7.08.512.0Road traffic injuries
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ANALYSIS
Table 2| Infant and maternal mortality, mortality from and incidence of selected communicable diseases in Hungary and EU3
EU (2009)
Hungary
Death rate/incidence 200920001990
4.35.19.214.8Infant deaths/1000 live births
5.16.010.816.8Probability of dying before age 5 years (/1000 births)
6.318.710.320.7Maternal deaths/100 000 live births
8.83.85.68.5Infectious and parasitic diseases (deaths/100 000 population)
Infectious diseases (cases/100 000 population):
3.80.30.010.1Pertussis
1.30.010.010.3Measles
7.10.12.2205.7Mumps
1.00.20.30.2AIDS
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ANALYSIS
Table 3| Out of pocket health expenditures per person in Hungary by year12
200920082007200620052000
34 96933 30030 77226 57726 50213 719Total (Forint)
% of total:
70.971.568.665.065.660.7Medicines
9.39.69.611.510.09.5Medical aids and prostheses
6.77.48.78.99.529.2Outpatient care
7.47.08.69.99.5Dental care
4.63.63.84.14.4Inpatient care
NANANA9.29.06.8Informal payments
1 Forint = £0.002 (€0.003; $0.004) at current exchange rates.
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ANALYSIS
Figures
Fig 1 Life expectancy at birth (in years) in selected countries, 1990 to 2008 (or latest available year)3
Fig 2 Public expenditure on health as percentage of gross domestic product in selected countries, 1994 to 20095
Fig 3 Number of nurses versus number of doctors per 100 000 population in Hungary and selected countries and averages
in 2008 (or latest available year)3
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ANALYSIS
