Hungary: #27 in the 2021 World Index of Healthcare Innovation

Introduction

Hungary’s single-payer system ranked 27th in the 2021 WIHI Analysis — down two spots from its inaugural ranking in 2020. Notably, Hungary ranked 10th in the WIHI Dimension for Fiscal Sustainability, primarily due to its relatively low health care spending (approximately 6.6 percent of its GDP). Nevertheless, Hungary ranked low in the WIHI Dimensions for Quality (29th), Choice (25th), and its global contributions to Science & Technology (26th).

Health outcomes in Hungary are poor. For instance, the average life expectancy in Hungary of 76 years sits five years below the European Union (EU) average of 81. Moreover, mortality rates from heart disease, digestive system disease, and cancer are higher than the EU average. Hungary’s lower life expectancy stems from lifestyle factors such as an unhealthy traditional Hungarian diet, alcohol consumption, and smoking. Furthermore, Hungarian infant mortality remains 20 percent above the EU average.

Background

The history of Hungarian health insurance dates back to 1496 when groups of miners banded together to form mutual assistance funds known as bányatársláda for the infirmed. Four centuries later, in 1854, Habsburg Emperor Franz Joseph I required all mining companies to establish such funds, and, in 1891, he established universal health insurance for industrial workers. This insurance system paralleled the Bismarckian model implemented in Germany (1883) and Austria (1887).

Nevertheless, in 1949, the Communist Party abolished Hungary’s Bismarckian model and replaced it with a state-run health care system. Four decades later, in 1988, restrictions on private health care providers eased, but the single-payer insurance system remained in place. In the years that followed, health care management eventually shifted from national to local governments.

Today, the central government in Budapest formulates regulations for Hungary’s single-payer system. The central government exercises strict control over revenue collection and sets uniform standards for providers, budgets, and payment. Nevertheless, Hungary’s municipalities are responsible for the administration of primary, secondary, and tertiary care. In particular, municipalities are responsible for primary care, whereas the responsibility for secondary and tertiary care is shared among municipalities, counties, the private sector, and the central government.

Cost-containment was the dominant focus of recent health policy reforms, with approximately 6.6 percent of Hungary’s GDP dedicated to health care spending. However, Hungarian residents are generally dissatisfied with their health system. In 2009, Hungary ranked 26th among 27 EU Member States regarding citizen satisfaction with their health systems. Nevertheless, Hungary holds an excellent immunization rate, with virtually 100 percent coverage against childhood diseases.

Quality

Hungary ranked 29th in the WIHI Dimension for Quality (up one spot from a year before). In particular, Hungary struggled in the WIHI Elements “Measures of Preventable Disease” and “Pandemic Preparedness and Response” — ranking second-to-last (30th) in each. Similarly, an aging hospital infrastructure ranked it below the median in the WIHI Element for “Infrastructure” (23rd). Nonetheless, Hungary scored considerably higher in the Element “Patient-Centered Care” at 17th.

Choice

The Hungarian health system ranked 25th in the WIHI Dimension for Choice. In particular, the WIHI Elements of “Affordability of Health Insurance” and “Freedom to Choose Health Care Services” ranked Hungary 28th and 21st, respectively. Similarly, Hungary ranked 21st in its ability to offer patients “Access to New Treatments.”

Science & Technology

Hungary ranked 26th in the WIHI Dimension for “Science & Technology.” In addition, Hungary ranked 16th in the WIHI Element measuring “Medical Advances” but 25th and 26th in the Elements ranking “Scientific Discovery” and “IT” adoption, respectively.

Fiscal Sustainability

The Fiscal Sustainability Dimension offered a bright spot for the Hungarian health system. Accordingly, Hungary ranked 10th in the WIHI Dimension. Notably, Hungary performed well in the WIHI Element “Growth in Public Health Spending” (5th) due to the economic austerity measures taken over the last decade. Additionally, Hungary ranked above the median for the WIHI Element “Public Health Spending” (13th). However, the lasting economic impact from the global recession caused Hungary’s debt-to-GDP ratio to be relatively high (as measured in the WIHI Element “National Solvency”), where it ranked 19th.