27 November 2019 14:16

Changes proposed to the Law “On Medical Insurance” of the Republic of Azerbaijan

The changes proposed to the Law “On Medical Insurance” of the Republic of Azerbaijan are being discussed at Milli Majlis. The proposal envisages that the government will allocate a mandatory health insurance fee in the amount of 90 manats per capita for one calendar year beginning from January 1, 2020.

Moreover, it has been determined to deduct mandatory health insurance fee at the rate of 2% from a part of the wages fund amounting up to 8000 manats and at the rate of 0.5% from a part of the wages fund exceeding 8000 manats of the employers and employees working for public and oil sectors. And it has also been determined to charge mandatory health insurance fee at the rate of 1% from a part of the wages fund amounting up to 8000 manats and at the rate of 0.5% from a part of the wages fund exceeding 8000 manats of the employers and employees working for non-governmental and non-oil sectors.

The mandatory health insurance is built on the principle of solidarity. This principle implies that insurance contributions collected from population groups specified by law are used to cover the medical care expenses of citizens. In 2020, it is proposed to introduce mandatory health insurance in the country in stages. It has been defined to collect mandatory health insurance contributions beginning from January 1 of the next year.

The thing is that it is practically impossible to introduce the phased approach to collection of mandatory health insurance contributions since administrative territories where some people work under a labor contract differ from the administrative territories where they are registered.  Therefore, even though in the first quarter of 2020, mandatory health insurance will be extended to residents registered in the northern region (for instance, Guba), the number of them are employed in other regions, particularly in Baku.
The Mandatory Health Insurance Fund’s budget has already been forecasted, the source and use of income have also been defined. It is projected to allocate 90 manats a year from the state budget per person with a total of 900 million manats, 229 million manats from employees and employers, and 185 million manats from other sources.

It is necessary to note that main difference between the healthcare facilities located in the territories where mandatory health insurance is going to be applied and applied in later stages will be related to their funding mechanism. 
The healthcare facilities will be funded by the State Agency on Mandatory Health Insurance (Agency) as part of mandatory health insurance in accordance with volume of delivered medical services. In the healthcare facilities where mandatory health insurance to be introduced in later stages next year, financing will be made at the cost of maintaining the facility. 90 manats allocated per capita will be gradually transferred from the state budget to the Agency to cover insurance or maintenance costs. The funds will be used for healthcare delivery services included in the benefit package, the investments necessary for the preparation of healthcare facilities, strengthening of information technology infrastructure.
Therefore, Agency possessing the health resources will ensure nationwide implementation of mandatory health insurance in stages next year. As a result of which accessibility to medical services will be increased.

As for receiving medical services in the territories where mandatory health insurance will be introduced in later stages, the population in those territories will continue to receive medical services in the   manner prescribed by law.
More information about phased implementation of mandatory health insurance in 2020 can be found here.