The future of Hungarian health insurance

No one knows for sure what’s going to happen. There are some people who are already predicting that the SZDSZ will leave the coalition if a minority within the MSZP parliamentary delegation does not vote for the government’s health care bill as they threatened yesterday. The SZDSZ claims that the party’s main demand during the coalition negotiations was that their ideas on health care would be accepted by the MSZP but the SZDSZ’s plans have already undergone several changes because of MSZP objections. One SZDSZ minister of health, Lajos Molnár, resigned because he felt that the plans were so compromised on the insistence of the MSZP that they no longer bore any resemblance to the original. Then came Ágnes Horváth, a young physician, who served under Molnár as his undersecretary. Poor Horváth is currently the most hated politician in the country because the Hungarian population is not taking too kindly to the reforms. People in general hate change and, although they admit that the current health care system is no good, at least they are familiar with it. They fear the unknown. The doctors, led by the Hungarian Medical Association, play on these fears because some physicians who are the beneficiaries of the present situation have a more well-defined fear: a future in which their mostly non-taxable income may be jeopardized.

After many, many compromises there is a health insurance proposal ready to be discussed on the floor of the parliament. The proposal is cobbled together from radically different ideas on insurance. With some justification it is referred to in Hungary as a mule (that is, the sterile offspring of MSZP and SZDSZ theories–I don’t know which is the female horse and which the male donkey). On the one hand, the SZDSZ wants competition and free enterprise in health insurance. The liberals think that the system will function well only if there are multiple insurers (mostly large international firms) who would establish health networks. This system, they hope, would provide the necessary competition within the medical profession. On the other hand, the MSZP, originally at least, wanted to have only one state insurance company. Basically everything would remain the same but a new state insurance company, unlike the present Health Care Fund, would behave like a real insurer and would demand monthly payments from or on behalf of everybody. Currently close to one million people don’t pay a penny but use the offered medical services. The SZDSZ wouldn’t agree to this, while the MSZP wouldn’t agree to a system of multiple insurers.

And thus the mule was born, the union of the two plans: there would be some twenty regional insurance companies. The state would have a majority (51%) stake in each company, but the management of the company would fall to the private partner. Neither the MSZP nor the SZDSZ is happy with this arrangement but one thing is sure, the SZDSZ refuses to make any further concessions.

According to rumors, Ildikó Lendvai was unable to convince about twenty MSZP members to vote for the health care bill. They have theoretical objections: they still really want a single state insurer. But they couch their demands in terms that would scuttle the proposal while seeming to endorse its outlines. In brief, they want to limit the profits of the private insurers and they demand that the heads of the insurance companies be appointed by the government. Basically, these left-wing MSZP members want the private insurers’ money in return for next to nothing. Under such circumstances I don’t think too many insurance companies will flock to Hungary. If these twenty people vote no, the bill is dead. If the bill is dead, the SZDSZ may leave the coalition and support an MSZP minority government from the outside. Not the best arrangement. I don’t think that things will go that far, but one thing is sure: Gyurcsány will need all his powers of persuasion to talk the twenty left-wingers in the MSZP delegation into accepting the proposed bill in its current form. And will they be signing on to a viable health insurance system? I, for one, don’t know.