Ukrainians over gold. Health insurance companies are fighting over Ukrainian policyholders

Six employee health insurance companies have called on the Ministry of Health to adjust the redistribution of money related to refugees from Ukraine. They do not like the fact that most of the refugees registered with the General Health Insurance after the outbreak of the conflict.

The reason is the – perhaps surprising – fact that refugees are very lucrative clients for insurance companies. Although contributions to the public health insurance system (whether for employees or for persons without regular income) do not differ in the case of refugees from “standard” Czech insured persons, Ukrainians use health services far less. Compared to the Czechs, only about a third.

“It improves the VZP balance, creates billions of dollars in differences, and the system is ultimately far from fair,” explains the reason for the complaint against the VZP, executive director of the Association of Health Insurance Companies, Martin Balada.

Redistribution according to tables

The system of redistribution of money within the framework of public health insurance is extremely complex. And in recent years, after a series of amendments, it has become even more difficult to understand: insurance companies will not only receive their share of the total amount of money in the system based on how large their “tribe” is (i.e. how many insured persons are registered with them), but it is also taken into account what health condition the “tribe” is in, i.e. how much the insured uses health care and whether they are being treated for some rare – i.e. financially expensive – disease.

However, in the case of Ukrainians, these redistribution parameters, according to the association of insurance companies, were not adequately applied, because the outbreak of the armed conflict happened quickly and the state needed to react to the wave of refugees just as quickly. “Nothing has changed since then. Unlike Czech citizens, payments for Ukrainians are still not redistributed according to their actual costs, but according to the costs usual for Czech insured persons. However, the actual cost for this large group of insured persons is completely different,” explains Balada.

Ukrainians do not go to the doctor with banalities

These are fundamental differences. While the average Czech insured uses care for around forty thousand crowns per year, the Ukrainian refugee costs around thirteen thousand on average. Data from insurance companies shows that savings on the part of Ukrainians can be found across the system: from prevention to treatment.

According to the Association of Health Insurance Companies, there are several reasons. In general, the Czech system is relatively generous in terms of the range of medical procedures – people from Ukraine are not used to this and are only just learning what they are entitled to. Another complication can be the language barrier, due to which many refugees are unable to communicate adequately with a Czech doctor. “And then it’s also about the fact that Ukrainians in general are not used to visiting doctors with banalities. If we talk about excessive use of care for Czechs, then we can really talk about below-average use for refugees,” Balada is clear.

What is not spent remains with the insurance company

At the same time, what the insurance company does not spend on care remains in its budget; money is not returned anywhere. According to calculations, VZP will thus come to roughly five billion crowns, thanks to which it will improve its balance sheet, which is also acknowledged by the ministries of health and finance in the government’s assessment of the expected development of the public health insurance system.

“The majority inclusion of asylum seekers in the state insured category, together with significantly below-average utilization of health services, had a positive effect on the balance of the public health insurance system. And that above all at the VZP CR, where the most asylum seekers were concentrated,” the material states.

VZP lead

But why did the vast majority of Ukrainian refugees end up with the VZP? According to the Association of Health Insurance Companies, this was caused by unfair conditions when accepting migrants. From the very first day of accepting refugees, the Ministry of Health was counting on the scenario that asylum seekers in the Czech Republic would receive a visa and become participants in the public health insurance system. They should have automatically registered with VZP, which was also the first point of contact with asylum seekers.

After criticism from other insurance companies, the department changed this mechanism in March last year. “Nevertheless, VZP gained a huge lead, we are talking about a large number, roughly 300 thousand people. By the way, it was also the only health insurance company with which the ministry consulted about the expected influx of refugees. All the rest of us stood aside until we spoke,” says Balada.

Of course, every insured person has the right to change insurance company. It can be done once a year. There are two registration periods for this: the first lasts from January to March and the second from the beginning of July to the end of September. So why couldn’t the solution be a large-scale campaign for Ukrainians to re-register elsewhere, even with other insurance companies?

“I can’t imagine such a campaign. We would have to target Ukrainians specifically, so it would have to be in their language, to a large extent addressable. I also see it as an ethically questionable matter to target people who fled the war,” says Balada from the insurance association. He therefore prefers such a solution to adjust the redistribution mechanisms. “Without a correct distribution of resources, fair conditions between insurance companies cannot be imagined,” he is clear.

VZP: We took the risk and made money

However, according to the General Health Insurance Company, there is no reason to change. A positive balance sheet only proves that the largest insurance company is successful. She denies that she would have an unfair advantage. “When tens of thousands of people fleeing Ukraine began to flow to us at the end of February 2022, it was VZP, whose employees at all the then ‘kapces’ (Regional Assistance Centers for Helping Ukraine, editor’s note) tirelessly helped 24 hours a day, seven days a week with registration in the healthcare system,” said Zdeněk Kabátek, director of VZP, to Hrot. “Other health insurance companies could and maybe should have been there anyway, but they weren’t.”

Criticism from the association of insurance companies is said to be unwarranted, because the VZP took a risk when it comes to the refugee crisis. “At the time, we were dealing with concerns that seriously ill people would come from Ukraine requiring expensive specialized treatment, even that medical tourism would flourish, where people would come purposefully just for better care. We went into it with all the risks. If the black scenarios were to come true, we would also bear all the consequences,” Kabátek added.

The ministry wants change

According to Kabátek, if the “Ukrainian” incomes of VZP were to be cut somehow, it would mean that work and honestly earned success are being punished in the Czech Republic. “We provided a full service not only during registration, but throughout the organization of care. For that, thanks go to my colleagues for helping to solve an absolutely extraordinary crisis situation. I see no reason why VZP should be punished for this,” says the director.

However, the Ministry wants to deal with the initiative of employee insurance companies. He is to create a special working group for this. He plans to implement the redistribution change in the public insurance system next year. “According to the estimate, the balance of the system will be negative in 2024, amounting to -9.2 billion crowns. Of this, −2.2 billion for VZP and −7 billion for employee health insurance companies. The ministry is actively aware of the need to correct this imbalance and is preparing changes to the redistribution system to correct it,” the ministry said.