• Spending overview
• Policy overview
• Diseases overview

Spending overview

The Czech Republic's per-head healthcare spending amounted to US$1,626 in purchasing power parity (PPP) terms in 2007, putting it close to the bottom of OECD members' healthcare spending. The pronounced economic recession in the Czech Republic in 2009, which resulted in rising unemployment and dampened wage growth depressed demand for healthcare services—from 2008 most Czechs have had to pay for doctor and hospital visits.

Public spending on health accounted for more than 85% of total health expenditure in 2007, an extremely high proportion by the standards of OECD members—only Luxembourg had a higher ratio, at 90.9% in 2006. A private healthcare sector, not funded by compulsory insurance contributions, operates in parallel with the state system, catering to groups such as foreign residents. The private health insurance market is small, but growing.

Demand pressures are increasing as a result of an ageing population and rising public expectations. However, the health system suffers from a shortage of funds, a problem that is unlikely to diminish in the short term, given the lack of political will to tackle it.

Policy overview

The Czech healthcare system still reflects the legacy of the planned economy in that it is based on overstaffed hospitals and extensive specialist care. The system suffers from severe funding problems, owing to a fee-for-service arrangement in which providers set prices and consumers determine demand, with hardly any disincentives to over consume free services, and a wide choice of both services and providers. The oversupply of services is also a result of the dominance of large hospitals and the political influence of powerful vested interests that have successfully fought to maintain it. The lack of will to overhaul the healthcare system, together with strong pressure by healthcare professionals for more rapid international wage convergence, has fuelled a continuing steep rise in the system's costs.

Reforms of the health system began in the early 1990s, with the introduction of a German-style social insurance system and the privatisation of primary care services. A mandatory health insurance system was introduced in 1992, involving competing non-profit insurers and providers. Funding methods were reviewed in the mid-1990s, and measures were taken to guard against insolvency among the private healthcare funds. Under the statutory health insurance system, contributions from individuals, employers and the state are channelled into a health insurance fund. Membership is universal, and all Czech nationals, as well as foreigners with both temporary and permanent residency must participate in the system. The state covers payments of children, students under the age of 26, pensioners, women on maternity leave and those with children under a certain age. Employees' contributions are shared by employees and employers, with the employee paying one-third of the amount.

According to the Czech Statistical Office (CSU), health insurance covered 75.9% of total healthcare expenses in 2008, with 16.2% being paid directly by private individuals on items such as healthcare equipment and surcharges on medicine. The remainder of the total expenditure on healthcare (7.9%) was covered by the state and local budgets, largely on selected investments on expensive healthcare projects.

Diseases overview

Dramatic improvements over the past decade in indicators such as life expectancy and infant mortality have put the Czech Republic only marginally behind Western Europe and ahead of all east European countries except Slovenia. The Czech Republic's disease profile is also similar to Western market economies. However, circulatory diseases and cancer rates are well above the EU average.

Life expectancy rates are higher than in many other central and east European countries, but are still lower than the average in the EU15. This reflects a poor diet, an inadequate healthcare system, high levels of pollution, and excessive alcohol and tobacco consumption.

Health indicators are forecast to remain on a positive trend over the next five years: average life expectancy is expected to rise slightly over the forecast period, and the infant mortality rate is forecast to fall slowly.