EurWORK European Observatory of Working Life

Latvia: Doctors' strike effects increase in healthcare financing

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Tension in the healthcare sector intensified at the end of 2016 when midwives and doctors protested against low pay and long working hours. The government made concessions to the midwives but rejected demands from general practitioners, who went on strike on 3 July 2017. New legislation on financing of the healthcare sector is being prepared.

Background

There is a long history of protests in the Latvian healthcare sector. Since the end of the 1990s, the Trade Union of Health and Social Care Employees of Latvia (LVSADA) has used different methods to convince the government that financing of the healthcare sector should be increased. Actions included peaceful negotiations with the government, public protests and even an application to the European Court (November 2007). However, these activities brought about little change.

At the end of 2016, the situation reached breaking point when doctors and midwives at Riga Maternity Hospital, supported by colleagues from other hospitals, protested against ‘prolonged normal working time’, which was introduced in 2009 to provide healthcare services at a lower cost. The government had little choice but to increase pay for midwives and to promise the gradual abolition of prolonged normal working time, until 2020.

Following these protests, general practitioners, led by the Association of Latvian Family Physicians (LGAA) and supported by the Latvian Association of Rural Family Physicians (LLGAA), started their campaign and warned of strike action if their demands were not met.

Strike demands map out radical change

General practitioners stated their demands in five main points.

  • an increase in the capitation payment by 30% for the next three years – from the current monthly value of €1.25 per patient to €1.63 in 2018, €2.11 in 2019 and €2.75 in 2020;
  • an increase in tariffs on procedures carried out by family doctors so that the total payment in 2018 will be 45% more than in 2017;
  • an increase in pay for nurses and doctors' assistants by 30% for the next three years;
  • support for the development of independent medical practices using existing general practitioners, rather than the planned establishment of centralised medical institutions of primary care (so-called 'policlinics’;
  • to facilitate the secure introduction of the government’s e-health system around personal data protection.

The capitation payment is a fixed sum that is granted to general practitioners, calculated on the number of registered patients in their practice.

The government immediately rejected these demands. However, it was preparing a number of reforms due to the healthcare sector being an issue in the Country-specific Recommendations (CSR) for 2016 from the European Commission under the European Semester.

On 3 July 2017, around 600 general practitioners went on strike. Contrary to previous strikes when medical services were provided as usual during industrial action, this time medical practices that were on strike did not provide any state-financed medical service. The Ministry of Health made efforts to ensure that patients did not suffer. The National Health Service issued an online chart showing the medical institutions where services were available, set up a dedicated phone line for consultations, and provided additional service centres. In addition, local volunteers were appointed to hospitals to provide services according to their competence.

Negotiations continue

Negotiations with the Minister of Health, Anda Čakša, and the government continued during the strike action, with an additional demand from LVSADA to increase the financing of healthcare to 5% of gross domestic product (GDP) and 14% of the government’s expenditure. The government, however, said it was unable to increase finances in 2017, but promised to allocate more resources starting from 2018. The improvement of healthcare financing was indicated as one of two priorities for the 2018 budget.

At the beginning of July 2017, the government put forward a proposal to LVSADA that set out improvements based on the National Reform Programme. The proposal promised to provide a proportional increase in the salaries of general practitioners starting from 1 January 2018 on the basis of increased share of work remuneration in the capitation payment and virtual size of practices – 1,500 registered patients. The proposals also included reforms to the primary healthcare system, reassessment of the cost of medical procedures and the implementation of an IT system – e-health.

On 10 July 2017, LLGAA unexpectedly agreed to the proposals and left the strike.

On 17 July 2017, the government sent a copy of the agreement to LGAA, including an additional element – a further payment of €150 per month could be paid to a general practitioner depending on quality criteria. Additional finance for the increase of the capitation payment should not exceed €3 million and should be based on quality criteria. However, LGAA announced that it would not sign the proposal because:

  • the strike demands called for an increase in the capitation payment by 30%, not just the share of work remuneration;
  • the requested amount of additional finance for the increase of capitation payment was €5.3 million;
  • the inclusion of quality criteria in the capitation payment was to be negotiable.

According to LGAA, the strike will continue until 1 October 2017 but in an altered form. General practitioners will provide services for 20 patients per day, with any patients exceeding this limit to be registered on a waiting list. Prevention services will only be provided for a fee, despite the fact that such payments do not comply with the agreement on delivering state paid services and charging for them is illegal. General practitioners will be asked not to sign an agreement on the introduction of the e-health system in their practices and not to use it.

New law in the making

On 29 June 2017, the National Tripartite Cooperation Council (NTSP) adopted a decision that the government should urgently draft a bill that sets out clear guaranties regarding an increase in pay for healthcare workers, and increased financing of the sector. The draft bill would envisage an annual increase in financing until it reaches 4% of GDP in 2020.

On 24 August 2017, the NTSP discussed two versions of the draft bill. It is more or less agreed between the government and the social partners that financing of the healthcare sector should be based on the insurance principle and linked to personal income tax paid. One version proposed two laws: one on increasing the financing of the healthcare sector, and the other incorporating both financing and insurance into a single law.

The Ministry of Health, as well as the Employers' Confederation of Latvia (LDDK) supported the proposal for a single law, while LVSADA felt that insurance issues were not yet clear and could delay the adoption of the whole law. There are also suggestions that the quality of the law may suffer due to the inordinate hurry of its implementation. The Free Trade Union Confederation of Latvia (LBAS) and LVSADA have expressed their commitment to ensure that agreed guaranties for healthcare workers are included in the law.

Commentary

It is difficult to say which has made more impact on the situation in the healthcare sector – protests and the strike of medical practitioners, or the European Commission’s CSR, or both, but conditions in the sector are gradually improving. The government will allocate almost €200 million for the financing of reforms in the healthcare sector in 2017.

On 22 August 2017, the Minister for Health stated that she would ask the government to add €2.9 million to the planned increase of the financing of the healthcare sector in order to increase the capitation payment by 30%. Within the reform plans, the most critical issue is to introduce insurance so that, on one side, the availability of healthcare services is tied to tax payments, while on other side, medical assistance is also available for those who do not pay taxes. Regarding the latter, one idea put forward is to introduce a regular payment scheme for such individuals, or a sum to be paid equal to a certain percentage of the annual minimum wage.

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