Hungary for change

Hungary for change

Hungary’s healthcare system has its roots in the old Socialist model, but is gradually privatizing certain services. Dr Peter Felkai tells us how to get the best out of the current system

First published in ITIJ 101, June 2009

Hungary’s healthcare system has its roots in the old Socialist model, but is gradually privatizing certain services. Dr Peter Felkai tells us how to get the best out of the current system

Hungary, a landlocked country in central Europe, has a population of just 10 million people; but it has a rich cultural history and an enticing capital city in Budapest, and as such is a popular travel destination for vacationers to the continent. But do visitors to Hungary know much about the level of medical care available in the country, and how the healthcare system operates? Well, no, because they don’t expect to have to come into contact with the heath service whilst on vacation, but it still surprises me that some twenty years ago, when I began to treat foreign tourists in Hungary, almost all US visitors carried a little package of sterile, disposable syringes, as well as some basic antibiotics. I was completely shocked then, because I thought Hungary was famous for its good quality medical care compared to other former socialist countries. But the tourists (probably upon the advice of their home doctor or travel agent) treated Hungary as a developing country.

Still recently, however – five years after joining the EU, and one year after becoming part of the Schengen Area – I get questions at international medical congresses, which indicate a continued, general ignorance about medical care in my country, so it is with great pleasure that I take this opportunity to tell you more about the level of care available. With the help of this article, doctors and assistance companies providing pre-travel advice for their customers will be able to see that Hungary is a safe place to send their clients.

According to statistical data from 2007, some six to seven per cent of total tourist expenditure was on ‘healthcare, medicine and sport’ (predominantly spa treatments). There are no exact figures for the morbidity rate of foreign tourists to Hungary, but generally some 30 per cent of visitors face some kind of medical issue during their trip, which often involves having to seek medical advice or treatment.

A little bit different

With the downfall of the Socialist regime in 1989, Hungary transformed itself from an ‘unknown, far away land’ into a popular tourist destination. But even under the Socialist system, Hungary was a rather well organised country, often dubbed the ‘happiest barrack in the socialist camp’, and its medical system functioned well.

new mechanisms have been established to allow private physicians to act as independent contractors to health agencies, and private companies are now providing many former inpatient services through home-care services.

The fall of the ‘Iron Curtain’ and the restoration of democracy made the information gap between East and West regarding medicine disappear altogether, but new ‘curtains’ have arisen, making the management of healthcare for travellers to the country difficult. Besides the language barrier, the healthcare system is different from that in many other countries. These differences are based on the historical circumstances of the past 45 years and can be summarized as follows:

1. Almost all the hospitals in Hungary are state-run (by central or local government), and hence they are run on a not-for-profit basis. They all have a service agreement with the National Health Insurance Fund (HIF), which is a separate administrative organisation under the supervision of the Ministry of Health, Social and Family Affairs, whose main income is from public health insurance contributions.

Hungary's previous healthcare system relied on institutional care, where emphasis was placed on the development of large hospitals (with 1,500 to 2,000 beds) and university clinics. That has changed and there are currently 155 hospitals in Hungary, mostly owned by local governments. The national institutes (for cardiology, oncology, pulmonology, and so forth) and rehabilitation centres belong directly to the Ministry of Health, and the country’s four medical schools between them own five clinics. The hospitals’ operational costs are covered by the HIF. Hospitals widely accept the European Health Insurance Card, which only covers the cost of treatment for conditions needing urgent attention and only where the healthcare provider has a contract with the ministry of health in the patient’s home country.

2. The hierarchic structure of healthcare has meant rigidity in the healthcare system. Until 1992, the Hungarian population could not choose their own doctor and had to go to their local district physician; and if hospital treatment was needed, patients were normally admitted to their district hospital. Today, a hierarchy still remains in place whereby patients needing specialist intervention will need to first visit their GP for a referral to hospital, where in turn they will be referred to a specialist consultant.

3. The majority of Hungarian hospitals do not cover all medical specialties. Municipal hospitals and those in the capital city predominantly offer only basic services (such as internal, obstetric, basic surgery, and so forth). The larger, county hospitals, however, usually cover the whole spectrum of specialties; although out of almost 600 hospitals across the country, this amounts to only 10 per cent of medical establishments. Either way, those patients needing specific treatment based on their diagnosis can be directed by their GP or the emergency doctor into a clinic with a suitable care structure. That’s why it doesn’t make sense for a foreigner to go directly to the nearest hospital, as in a non-emergency situation, a different clinic may be more suitable.

Outpatient clinics are predominantly state-run and offer a wide range of treatments as they are often affiliated with hospitals, but private outpatient clinics are becoming increasingly prevalent, offering mainly gynecology and dentistry services, but also sometimes lab services, consultations, and sometimes ECG and RTG. If any costly intervention or investigation is needed, private clinics immediately refer their patients into the state system for further treatment.

4. Most hospitals have failed to create emergency wards. Hospital admissions in Hungary are usually made by general practitioners or family doctors – who establish the initial diagnosis – or by ambulance staff in an emergency. In emergency situations, the ambulance staff will know which hospitals are running emergency wards on that particular day and will be able to take the patient to an appropriate facility.

Meanwhile, if a foreign visitor goes to a hospital, in a non-emergency situation, without a medical referral (e.g. signed by a GP) he can expect a long wait in the reception area of what is probably an inappropriate facility. To make the things worse, it is often hard to find a receptionist, or any competent person, who can inform the foreign visitor what to do, or where he should go, as generally hospitals have no reception ‘desk’, just a doctor on duty who would be called upon if the ‘difficult’ situation of a foreign tourist arriving at the hospital arose.

5. According to Hungarian medical regulation it is illegal to release medical information for anybody without the prior consent of the patient, and telephone consultations are strictly prohibited. In any case, the extremely overburdened treating doctor doesn’t generally have time to update insurance company representatives or assistance doctors by telephone. In fact, to reach anybody in the hospital is a tough business: generally there is no bedside telephone, and the telephone operator in the reception area speaks fluent Hungarian only.

Coming of age

After World War Two, as a result of Jalta Treaty, Hungary belonged to the Soviet sphere of interest. As with the general state administration, the healthcare system followed the Soviet model. The key ideology was – and remains – that taking care of inhabitants’ healthcare issues are exclusively the task of the state. Then, as now, there was only one social security insurance company, which was run by the state. The negative side of this model was the total control of all healthcare facilities (including dental care, pharmacies, general practitioner’s offices, hospitals, and nursing homes) by the state. The positive side was that all medical treatment was free of charge for all, at any time and at any level. Even the price of medicines was heavily subsidized, and sometimes free for poor people. Obviously, with such a limited budget, the healthcare system could not develop properly, and even everyday healthcare was organized according to the Soviet model, with no private care (except for a few dentists). However, following the privatization of family doctor services, outpatient services began to be privatized in stages, and doctors were offered the opportunity to purchase specialist consultation rooms under closely specified conditions.

repatriating ill travellers from Hungary is difficult. This is, in large part, due to complicated regulations regarding payments

Furthermore, under the previous system, hospital budgets were determined by bed occupancy rates. Therefore, there was no incentive to release patients on a timely basis. But in 1993, new methods of paying health facilities were introduced. Now, for inpatient care, payment is based on the DRG system as in the United States, while a German-style ‘points’ system is used for determining payment for outpatient care based on a fee-for-service schedule. Accordingly, hospitals receive funding from the HIF on the basis of patient volume and types of treatment offered, regardless of the length of time patients stay. Thus, physicians have been encouraged to shorten inpatient stays, which has in turn created a growing need for outpatient and home-care health services. Moreover, the aim for politically induced centralization yielded striking results both in organizational and in scientific fields of activity, where decentralization would have only caused parallelisms in patient care or a pseudo-competitiveness at the expense of the sick.

So, prior to the political and economic changes in 1989/90, the government managed all aspects of the country's healthcare sector, but the Local Government Act (1990) transferred responsibility for the ownership, management and provision of health/social services to local governments. Major capital investments are now financed by the owners (local governments in most cases) or co-financed with the Ministry of Health. All recurring expenditures are financed and administered by the HIF.

According to a government report prepared in early 2000 for a European Union Commission, the major tasks of the healthcare system for the immediate future are to improve public health, to increase efficiency with regards to the financing healthcare providers, and to eliminate regional differences in the quality of services. To address these issues, the following measures are expected to be taken over the next few years. First, outpatient services will be privatized in stages. Second, the nature of the HIF financing of healthcare services will be reviewed. Third, the system of co-payment will be extended, increasing the role of households in financing products and services. Each of these measures offers obvious opportunities to healthcare service providers and related industries, including the insurance and assistance industries.

In 1992, the Minister of Welfare's Decree created the Family Physician Service. Previously, the system of ‘panel physicians’ required citizens to seek medical treatment only from designated district doctors. Now, individuals have the freedom to choose their own family physician. Family doctors refer patients requiring more sophisticated interventions to hospitals, outpatient clinics and/or diagnostic centres and labs for examinations and testing.

Overall, the privatization of various health services has proceeded most rapidly in the pharmaceutical, dentistry and family physician areas, while private sector development has been faster for ambulatory and diagnostic services, but negligible for outpatient and hospital care – areas where both costs and reimbursement mechanisms have thus far remained largely within the public sector. However, new mechanisms have been established to allow private physicians to act as independent contractors to health agencies, and private companies are now providing many former inpatient services, such as nursing, through home-care services. The production and distribution of health aid products, such as disposable, wheelchairs, crutches and test kits, has also been fully privatized.

With therapeutic protocols that are different to those in other countries, insufficient diagnostic facilities, and ongoing language barriers, repatriating ill travellers from Hungary is difficult. This is, in large part, due to complicated irregularities regarding payments. For example, hospitals are often unable to accept payment if their central office is closed; some hospitals stipulate that all payments must be made in cash; many hospitals offering differing pricing structures have no instructions regarding when to apply either one or the other. Generally, state-run hospitals are poorly prepared for paying customers.

treating foreign patients has become a lucrative business. However, many healthcare providers are eager to engage in the treatment of foreign visitors, with or without a license, and as such foreign insurance companies often experience difficulties finding reliable medical providers in Hungary.

Furthermore, as standards of medical facilities are uneven, with ill-defined separation of private and public healthcare facilities, treating foreign patients has become a lucrative business. However, many healthcare providers are eager to engage in the treatment of foreign visitors, with or without a license, and as such foreign insurance companies often experience difficulties finding reliable medical providers in Hungary.

In 2004, Hungary joined the EU, bringing many benefits to the country; but as the Eastern boundary of the EU, Hungary saw the arrival of an ever-larger number of migrants and refuges. This has created many problems for the country’s healthcare infrastructure: while Hungary’s traditional medical care system could hardly provide adequate care to local inhabitants, the system has had to care for an influx of migrants and refugees; and it certainly was not prepared for caring for the many travellers who started visiting the country.  

Recent developments

The main issue now facing Hungary is whether to create a multi insurance model by combining the social insurance model with the advanced possibilities of private insurance provision. The maintenance or even potential rebuilding of the old medical facilities will require an enormous quantity of money, especially given the introduction of EU regulations and standards into the country, which have required more investment and have increased running costs; but the question is how to raise these funds. The government proposed sharing such expenses with private investors, but a referendum in 2008 refused the multi-insurance model and the privatisation of medical facilities. The Hungarian people, who generally have a low income, are afraid of the potential rise in the cost of their medical treatment that might be caused by profit-oriented medical care.

The alternative has been for the government to decrease the cost of the healthcare and especially hospitals’ maintenance costs by centralizing medical care. Thus, smaller hospitals have been affiliated into the nearest larger one or closed altogether. Still, there were recently 38 physicians and 80 hospital beds (60 acute beds) per 10,000 people in Hungary. The average for EU countries – where per capita budgets for healthcare are generally three times higher than Hungary's – are 25 physicians and 70 beds (50 acute) per 10,000. But, as a result of the ongoing reform of Hungary's healthcare, the number of hospital beds has been reduced by twenty percent and will be reduced further.

This work by the present government has, overall, helped lead to an increase in the quality of care available in Hungary, although hotel functions within public hospitals remain generally poor. Most hospitals try to offer extra beds for ‘VIP’ – or paying – clients, i.e. those who choose to pay out-of-pocket for better or faster treatment, and such facilities are not too expensive (nearly the same price as a bed in a three-star hotel) but ensure a comfortable hotel and catering service besides the high quality medical care. Newly built hospitals have EU-standard patient rooms, with two beds and an en-suite bathroom. Nevertheless, private entrepreneurs have recognised the huge demand for better conditions and faster access to treatment, and have set up various types of private service, focusing on improving hospital accommodation and the quality of nursing – the more profitable aspects of medical care.

Unfortunately, new and non-licensed medical providers have also appeared, and there are not enough officials to eliminate them, as along with the rationalization of the healthcare administration came a decline in the monitoring and control of medical facilities. Additionally, because providing medical services to foreigners is a lucrative business, there are a huge number of blindfolding tricks directed at tourists and expatriates that are used by unscrupulous medical providers. The first is to use misleading wording, such as ‘private hospital’ to often mean nothing more than a simple nursing home that also offers perhaps a delivery suite and outpatient surgery, but within a luxurious environment and with staff who speak several languages, but which has no blood bank, advanced instruments or proven track record in safe medical treatment. In such facilities, almost all the doctors are part-time employees, who run to the private facility after their office hours in the state-run hospitals, where they have a full-time job. Another misleading term is ‘clinic’, which in western countries means a medical facility for outpatient services, but until recently in Hungary solely meant a university hospital.

Generally, prices are high in private facilities (compared with the services provided) and overcharging is not unheard of in some less scrupulous establishments. There have also been reports of unnecessary testing, investigations and repeat check-ups, and as a local supervisory doctor for many foreign insurance companies can speak from experience when I say I encounter such situations day after day.

Tools of our time

Foreign nationals may stay in Hungary temporarily, or live permanently in the country as an employee, retiree, student, dependent, refugee, asylum seeker or by having admitted status. From the point of view of health insurance, entitlement to healthcare differs by specific groups of foreigners. Those qualifying as insured must prove entitlement to benefits of the Hungarian health insurance scheme by presenting their certificate of entitlement, or in other cases, in keeping with relevant agreements (e.g. by presenting their passport).

As in any country, if your client has medical problem, he should, where possible, call his assistance helpline in the first instance, as the company will surely have a license for referring the patient to hospital, and they probably know the most appropriate hospital facility available in the region. If the client does not require inpatient treatment, outpatient treatment by a local correspondent doctor is more cheaply and more effectively carried out at the patient’s place of residence or accommodation. Moreover, this way the patient needs not face either the language barriers often faced in hospitals, or the long wait time prevalent in the public hospital arena or GP’s office.

This said, where hospital treatment is needed, visitors to the country should be encouraged to use state-run facilities, as they provide good and professional care. Emergency services in Hungary are free of charge, and can be summoned by anybody through telephone number 112, where operators speak mostly English but sometimes German.