Changes in economy and healthcare accompany Poland’s accession to the European Union

Jun 28 2005

The European Union (EU) is in a state of flux following the recent accession of several Central and Eastern European countries. Their membership has further complicated the already complex economic, social and cultural dynamics at work within the EU. With a population of over 38 million, around 40 cities with more than 100,000 inhabitants and an overall population growth rate of about 0.02 per cent, Poland (which joined the EU in May 2004), is among the ‘new’ member states set to play a decisive role in shaping the future of the EU.

In the sphere of international trade, the main export partners for Poland are Germany, Italy, France, the United Kingdom and the Netherlands. The import pattern, on the other hand, sees some changes with Russia and China emerging as major players in addition to Germany, Italy and France. Seen in the context of the medical sector, this is in keeping with the phenomenon of cheaper but good quality medical disposables from Asia and other Eastern European countries entering potential EU countries and, on their accession, using them as an entry point to access the rest of Europe. Since its entry into the EU, all medical devices sold in Poland need to bear the CE mark. The registration of medical devices in Poland comes under the jurisdiction of the medical devices section of the Bureau of Drug and Medical Devices Registration in Warsaw.

The history of healthcare in Poland is similar to many other countries in central and eastern Europe. The first state healthcare system was put into place in the late 1940s. Democracy was expected to trigger change in the Polish healthcare structure but real reforms took effect only in 1999. This was in the form of separation of the caregivers from the receivers in terms of payments while, at the same time, maintaining freedom of access and a system of no payments at the point of delivery. These reforms which revolutionised the way health services were financed caused serious disruptions. It is estimated that one in twenty hospitals in Poland were closed between 1998 and 2001. Efforts were subsequently undertaken to progressively resolve these issues.

The Ministry of Health controls the health system. This system has traditionally been centralised in its approach, although constant efforts have been made to decentralise authority and promote efficiency. The healthcare market as estimated by the Ministry of Health, was 6.3 per cent of gross domestic product (GDP) in 2004. The total market for corporate healthcare services was estimated at approximately US USD 150 million. This consisted of approximately USD 90 million dedicated to prepaid benefits and the remaining USD 60 million representing statutory occupational health checks.

Among the key issues currently affecting the Polish healthcare system include the relatively small proportion of GDP dedicated to healthcare and the lopsided allocation of resources. The payment pattern in some cases also tends to be irregular.

At the infrastructure level, inadequacies are reflected mainly in the lack of efficient healthcare delivery. Local needs are not addressed effectively and primary care services as well as referrals are poor. On the technology and supplies front, Polish care givers see a need for better technology, newer equipment and wider drug availability.

Most governmental reform has been targeted at supporting private contributions (currently accounting for about 35 per cent of the market) in order to implement a system of structural payments that would include insurance premiums and employee benefit schemes. The Polish Senate has recently voted for amendments to the law on health services sponsored from public funds. Great interest has also been evinced in foreign investments and in promoting collaborative endeavours in the Polish pharmaceutical and biotechnology market.

The year 2004 saw the Polish healthcare system suffer from unresolved issues related to the National Health Fund Act. A shortage of resources, lack of service improvements, resultant high levels of public dissatisfaction as well as strikes by medical personnel dotted the rather tumultuous Polish healthcare landscape.

On a more positive note, treatment patterns in Poland have been beneficially impacted by EU accession. For instance, there is greater freedom to travel within the EU as well as improved access to overseas treatment.

Poland is likely to experience steady economic growth in 2005. Fund transfers from the EU could generate additional capital flows into the country. This is supported by the fact that the growth of foreign direct investment was USD 7.9 billion in 2004. This marked an increase of 23 per cent when compared with 2003 and it also represented the highest increase in the last four years.

The unemployment rate in Poland is relatively high at around 18 per cent. But this is expected to decrease in 2005 due to investments in the economy. Amendments related to business regulations in the Special Economic Zones (SEZ) in March 2005 have resulted in permission to conduct services in the area of information technology, research and development, accounting, technical research and analysis and call centres.

In spite of price increases, some border control concerns as well as a few other teething troubles; Poland is optimistic about its future as part of the EU. Boosts to agriculture, easier travel, better trade conditions, improved access to the European market, opportunities for training and greater financial support are some of the most visible advantages of the country’s membership of the EU.

In the latter half of 2005, the focus will be on the parliamentary elections scheduled to be held in October. Expected to change the governing coalition, the elections promise to bring more change to Poland’s constantly evolving landscape. What will remain unchanged, however, will be Poland’s ever strengthening presence within the EU.

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