Universal Health Insurance in Armenia: A disguised, failed reform  aimed at achieving election goals:  Davdi Ananyan

ArmInfo. By introducing the Universal Health Insurance system, the Armenian government is primarily addressing its own election goals, as stated by David  Ananyan, former head of the State Revenue Committee, former Deputy Minister of Finance of Armenia, economist, and member of the "Wings  of Unity" political initiative, in an interview with an ArmInfo correspondent. Ananyan, who served as Deputy Minister of Finance from  October 2016 to May 2018, overseeing tax policy at the Ministry of Finance, and as Chairman of the State Revenue Committee of the  Republic of Armenia from May 2018 to June 2020, notes that the introduction of compulsory health insurance (CHI) has been discussed  by the Armenian Cabinet for several years.

The government has been working on the reform for at least five to six years, but experts  have consistently rejected it in its current form.

"When I worked in the government, I opposed this system because it  represented an unjustified additional tax burden on citizens in the  tax system, and in fiscal terms in general. There is a fiscal rule:  we do not have a principle of interrelatedness between revenues and  expenses; that is, our programs are financed from incoming revenues  on a priority basis, that is, if you provide budget revenue and  direct it directly to health insurance, this directly contradicts the  budget rule. Based on this, we considered the implementation of  compulsory health insurance to be inappropriate," the economist  clarifies.

Now the current government has gone even further and decided to  legislate a reduction in monthly deductions from salaries to the  Zinapa military insurance fund and redirect these funds to compulsory  health insurance. Apparently, they believed that the fund was already  financially secured for a certain period of time and, therefore,  these funds could be redirected to other purposes. In doing so, they  want to disguise the increase in the tax burden. Furthermore, they  are ignoring one social objective while trying to solve another.

Therefore, the expert believes, the authorities are dishonest with  the people and are concealing the truth to the last. And the people  need to be told that from now on, funds sent to the Zinapa Fund will  be used for health insurance. "This is a disguised, unsuccessful  reform, aimed at achieving its short-term goals, namely, by the 2026  parliamentary elections," Ananyan emphasizes.

The tax expert notes that both he and the political initiative "Wings  of Unity" advocate for the Canadian model of implementing health  insurance. This model entails public funding, ensuring universal  access to basic health services, with the possibility of  supplementary private insurance. In this case, it will be necessary  to redistribute budget resources, clarify priorities, and pursue a  path of consolidating budget revenues and expenditures, which is  neither easy nor quick. However, this does not mean that the  government should impose an additional tax burden on citizens, the  expert is convinced.

Furthermore, an important aspect of the Canadian health insurance  model is its emphasis on preventative medicine. Meanwhile, in  Armenia, the healthcare system is constantly busy "putting out fires"  rather than addressing their causes. "Thus, looking at data for  January-October of this year, we see that approximately 80% of  healthcare system expenditures are allocated to treatment, with only  the remainder going to prevention. Meanwhile, we must reverse this  trend," Ananyan notes.  "So we need to reconsider the ideology of the  healthcare system as a whole, since compulsory medical insurance  cannot be implemented based on such a distorted ideology," David  Ananyan concludes.