Latvia Health Profile 2012

Despite rapid economic growth, poverty in Latvia is extensive (officially estimated at approximately 20% of the population), with an increasing degree of income inequality. Life expectancy has also been increasing in recent years; however, it is the lowest among the Baltic and Nordic countries, at an average of 71.1 years (76.6 for women and 65.4 for men) in 2005. In general the lifestyle of the Latvian population is unhealthy, due to high levels of alcohol consumption, smoking, unhealthy diets, insufficient physical activity, and obesity. Mortality from diseases of the circulatory system is very high, causing more than half of all deaths. Infant mortality also remains high at 7.8 per 1000 live births, though it has fallen substantially since 1980. Suicide rates are higher than in any western European country, constituting the fifth most common cause of death.

Organizational structure
The Latvian health care system has undergone a remarkable transformation in the years since independence, and is now in the process of consolidating its new structures and institutional arrangements. Having abolished the highly centralized system that prevailed during the Soviet period, it has focused on decentralization of health care delivery, administration and financing; full or partial privatization of some kinds of provider institutions; and the establishment of independent primary care practices, which have led to a wide variety of legal forms of health care providers and institutions. It has experimented extensively with a variety of social insurance structures ranging from highly decentralized to partially recentralized arrangements, as well as with organizational forms of health care delivery in parallel with reforms of the state administrative system. The wide-ranging reforms and continuous and ongoing process of change are prompted by the perceived need to increase the efficiency of health care financing and provision and to improve the quality of care.

Health care financing
Latvia is in the unique position of possessing a tax-funded “social insurance” system with a purchaser–provider split. The central Government is responsible for financing the statutory health care system through tax revenue. In addition, financing for health services comes directly from household payments as well as VHI. Tax revenue allocated for health care by the Ministry of Finance is transferred (via the Treasury) to the State Compulsory Health Insurance Agency (SCHIA), a state-run organization under the jurisdiction of the Ministry of Health, which signs contracts with all statutory health care providers. What differentiates the Latvian financing system from most general tax-based systems is that the funds from the central government budget are transferred to the SCHIA, which – together with its five regional branches – acts as purchaser of health services on behalf of the entire population. Payment methods for services and health care professionals have evolved over several years and are quite complex. They are determined by government regulations and defined in contracts. Health care personnel working as employees in health care institutions are salaried. GPs are paid through capitation, plus fees for defined activities, bonus payments and fixed allowances (such as a practice allowance). In addition, they hold funds for the purchase of certain secondary care services. Specialists are paid by means of fees for flat rate episodes of illness. Hospitals are remunerated by a per diem fee with additional activitybased payments.
Health expenditure as a share of gross domestic product (GDP) shows a slightly increasing trend in recent years, climbing from 6% in 2000 to 6.4% in 2004 (after falling in the late 1990s). The public share of total health expenditure has been steadily falling since the mid-1990s, from the very high level of 95% in 1995, and appears to be stabilizing after 2001 at 51–52% of total health expenditure. The very large increase in the private share of spending is due to the introduction of user charges. In addition, the private share of spending has increased due to the rapid growth of VHI, although to a far lesser degree. Furthermore, direct patient payments for such services as bypassing waiting lists for non-urgent operations (orthopaedics, cataracts, hernia, etc.), as well as costly examinations (such as computed tomography (CT), magnetic resonance imaging (MRI)) may constitute considerable amounts. Population spending on dental care for adults, which is not statutorily financed and provided, is also a key component of private health expenditure, as is spending on visits to practitioners on a private basis.

HEALTH AND DEVELOPMENT
Similar to many other countries in central and eastern Europe, health indicators have worsened in Latvia during the past decade, but there are signs that the situation is improving. Health for all by 2010. In 2001, the Cabinet of Ministers adopted the National Public Health Strategy of Latvia – Health for All by 2010. The Strategy is the main health policy document based on 21 targets to be achieved to improve the health of the population; to reduce inequality in health; to promote healthy lifestyles; to promote high-quality living standards; to promote the development of human resources for public health and improve the quality of health care; to promote health research; and to promote intersectoral collaboration for health.
Priority interventions. The Government of Latvia has firmly placed health care as one of the top priorities in domestic affairs – together with tackling corruption in private and public environments and advancing economic development. Reforms carried out during the past decade have set the conditions for  continued development. A policy framework has been established, and key decisions on the structure of the health system have been taken. The main components of the system focus on enhancing public health, primary care and reforming the hospital sector. For instance, 94.3% of the population are registered with a GP (May 2006). Latvia has made positive steps towards optimizing the hospital sector: strengthening of primary care and social assistance and then reducing the number of beds, mainly by converting several small rural hospitals into long-term social care facilities. All residents of Latvia are entitled to comprehensive health benefits determined by the Government.
The pharmaceutical sector has developed rapidly.  Medicines are basically regulated in accordance with EU legislation and other requirements and systems, and the EU provides substantial   support. The system is well developed technically with modern approaches to pricing and reimbursement. However, public spending on pharmaceuticals is still insufficient and behind the other Baltic states. Human resources for health. In 2005, the Cabinet of Ministers approved a Policy on Development of Human Resources for Health 2006–2015. The number of physicians and nurses declined dramatically in the  early 1990s and now is still below the EU average. The distribution of human resources in health care is imbalanced geographically and by speciality.

Main causes of mortality. Circulatory diseases remain the main cause of mortality: 56% of all deaths among women and 44% among men (2005). Cancer is the second most frequent cause of death. Neglected cervical cancer is common: 46.6% in 2005 were diagnosed at a late stage. External causes are the third most frequent cause of death. Smoking continues to be a serious health hazard, with more than 50% of the men and almost 20% of the women smoking daily. The incidence of drug dependence and alcohol consumption is alarming, especially among children and adolescents. The incidence of communicable diseases is high: 0.8% of people 15–49 years old are living with HIV infected according to UNAIDS. Co-infection with HIV and tuberculosis (TB) and multidrug-resistant TB are serious problems.