Bull World Health Organ. 2009 July; 87(7): 489-490.
doi: 10.2471/BLT.09.010709.
PMCID: PMC2704043

Copyright © World Health Organization (WHO) 2009. All rights reserved.

Armenians struggle for health care and medicines

Private financing constitutes about half of total health expenditures in
Armenia and most of that comes directly out of the consumer’s pocket. In
the current economic downturn, fewer and fewer people can afford it.
Monika Mkhitaryan and Onnik Krikorian report.

In the Communist era, Armenia enjoyed one of the best health-care
systems of all the Soviet republics, delivering comprehensive care on a
centralized basis. Since then the system has fragmented along partially
free-market lines and is today failing the majority of the people it is
supposed to serve. Skewed towards expensive hospital interventions that
swallow up more than 50% of the national health budget, the Armenian
health system falters at the local community level and is often totally
absent from rural areas.

The Armenian government is trying to redress the problem, notably by
introducing primary health care reforms with an emphasis on preventive
care and the management of chronic diseases. But as Dr Ara Babloyan,
Armenia’s minister of health between 1991 and 1997, puts it, `Despite
efforts in the area of primary health care, the health system requires
new improvements’, he said, adding that the scope and definition of
primary health care should be revised and enlarged.

One of the most pressing concerns is the cost of treatment and medicine
for working Armenians who don’t benefit from the minimal social
programmes that are in place.

To address this, the ministry of health has implemented several
programmes since independence in 1991 including a Basic Benefits Package
(BBP) established in 1999. The package provides specific health-care
services, including medicines, at no charge to vulnerable segments of
the population, including children, the elderly and disabled,
impoverished people and injured military personnel. Since 2006, primary
health care services have been free of charge under the BBP.

But, of course, being eligible is not the same as being covered. And
concern about the BBP being stretched a little thin is expressed in the
highest places: `Each year the number of people included on the
`vulnerable’ list is increased by the Armenian authorities and as a
consequence, the money attributed to each individual decreases,’
explains Babloyan. In concrete terms this means that people like Naira
Thovmasian, a 34-year-old woman living in Yerevan, who since 1999 has
needed dialysis to compensate for her failing kidneys, cannot always get
the medicines they need. `By law, the hospital has to provide the
medicines for me, but what happens if they don’t have them?’ Thovmasian
asks.

When the hospital can’t provide them, Thovmasian has to pay. And she is
not alone. Elizabeth Danielyan, head of the World Health Organization’s
(WHO) Armenia country office, notes private financing constitutes about
50% of total health expenditures in Armenia, with 84% of that coming
directly out of the consumer’s pocket, according to the national health
accounts monitoring project.

Just one month’s supply of albumin, one of the treatments Thovmasian
takes, costs her the equivalent of US$ 32. Under the BBP, she receives a
disability pension equivalent to US$ 27 per month. In other words this
one drug costs more than her pension. So how does she manage? `Usually I
can’t,’ she says. `That’s why my blood pressure drops constantly. But,
if we can’t afford to eat, what hope is there to pay for medicines and
treatment we need?’

The stark choice Thovmasian faces every month – between food or medicine
– is familiar to many Armenians, and becoming more so in the current
global economic downturn. According to the Central Bank of Armenia the
economy will shrink by 5.8% in 2009, after several years of double-digit
GDP growth driven by construction. According to the World Bank, the
current downturn could push an additional 172 000 people below the
poverty line, currently set at 12 600 dram (equivalent US$ 21) per month
in Armenia, bringing the total number to 906 000 by 2010, that is to say
one-third of Armenia’s three million population.

As part of a rapid United Nations (UN) assessment of the impact of the
global financial crisis, a study of the country was carried out in March
and April this year. It revealed that people who had lost their job or
who were no longer receiving remittances from abroad were already facing
problems accessing health care before the economy took a nose dive. And
now things are set to get worse. `People are beginning to
self-medicate,’ says WHO’s Danielyan. People wait to see if a medical
problem passes or resort to home remedies rather than seek treatment
from a doctor. People like Yevgenia Grigorian, a 51-year-old unemployed
woman living in Yerevan’s Erebuni district, who says: `I have to use
lemon, tea, vinegar, that sort of thing when any of us are ill.’

Today’s crisis also contains the seeds of tomorrow’s catastrophe. Again
according to the UN rapid assessment, because they lack the funds, some
people no longer cultivate the land, which means less and poorer food in
the shops in the coming months and years. Others struggle to feed
themselves now, increasingly buying food with borrowed money.

`Household dietary diversity has decreased with a drop in the
consumption of meat and vegetables other than potatoes,’ says Danielyan,
referring to the results of the UN rapid assessment. In Yerevan,
Thovmasian is buffered somewhat by the harsh realities of rural life,
but even there, she sees the effects of the shrinking economy. `Now it’s
getting worse,’ she says. `Things are more expensive. We can’t pay for
transport and we can’t pay for food.’

And that’s when things are going relatively well. Because for all the
hardships suffered by Thovmasian, her health-care needs are at least
partially covered by the government. For those not qualifying for free
services under the BBP, things get a good deal grimmer. There is a
system of partial subsidy for people with less serious disability and
pensioners without family support; and the ministry of health provides
medicines free of charge for certain cancers, diabetes, tuberculosis,
psychiatric diseases, epilepsy, myocardial infarction, familial
Mediterranean fever and malaria; but beyond that, they are pretty much
on their own. `It’s simple,’ says WHO’s Danielyan. `The working
population, people with low income, sufficient to pay only for food,
cannot acquire essential medicines.’

So what is to be done? Part of the problem is the lack of pricing
regulation for medicines. A new draft law covering price regulation and
reimbursement is under consideration. But would that be enough? When the
International Monetary Fund published a gloomy report on the prospects
for the Armenian economy in May, it recommended government spending to
support the poor and vulnerable groups through the current crisis,
particularly in the light of the shortfall in remittances. In other
words: throw money at the problem until the global economy cranks up
again. Indeed, it seems that the Ministry of Finance is now
reconsidering planned cuts in the health budget.

Danielyan isn’t convinced that this measure is sufficient to solve the
problem. `There needs to be fundamental change in the way risk is
shared, and service delivery model is organized and funded,’ she says.
`There is a need to ensure the correct functioning of social protection
mechanisms that would make it easier for the population as a whole to
afford health care.’ But isn’t this the wrong time to be implementing
major overhauls? Not necessarily, says Danielyan: `We need to take
advantage of the current crisis in an intelligent way and initiate moves
that would be less likely under normal circumstances, in the sense of
applying insurance principles that have been used in western Europe for
decades’ she says.

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