Estonia's sick fund up for grabs?

Jan 20, 2000

"Discussions over the future of the sick fund thus far have taken
into consideration all options, including that of bringing in private
capital, but there is no such plan and full privatization has not
even been mentioned in the discussions," Vaarik said.

The Finance Ministry has until now opposed establishment of a
public-law sick fund because it's not clear if this would lead to an
improvement in the quality of the medical service, the adviser said.

The ministry's opinion is that creation of a public-law sick fund may
reduce control over the fund's money and therefore it would rather
see the fund's resources as a transparent part of the state budget,
Vaarik explained.

The daily Postimees reported Jan. 18 that the Finance Ministry
headed by Reform Party leader Siim Kallas favors privatization of the
sick fund and the health insurance system.

Kallas was the only Cabinet member not to endorse a sick fund bill
prepared by the Social Affairs Ministry. If approved, the legislation
would give the country's sick fund system considerably more
independence starting from 2001, Postimees said.

The bill stipulates the founding of a public-law sick fund whose
15-member supervisory council would have sole responsibility for
health money, which amounts to about four billion kroons ($259
million) a year.

The daily quoted the Finance Ministry's Deputy Chancellor Ulle Lohmus
who said the bill failed to win approval, not because of details, but
in principle, because transition from a state system to a public-law
sick fund is not satisfactorily planned and that instead,
privatization of the system is worth consideration.

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