WHO and the World Bank launch new report assessing progress on health financing reforms implementation in Ukraine amid the war

Ukraine has maintained universal population coverage under the Program of Medical Guarantees (PMG), ensuring that all citizens and permanent residents can access health services included in the PMG improving protection against financial hardship from cost of healthcare. Central pooling of funds and their management by the National Health Service of Ukraine (NHSU) enabled continued financial coverage in territories affected by war that had lost their own locally generated revenues.

Launched at a joint event in Kyiv, the report highlights the impact of the war on Ukraine’s health system and the challenging context in which health financing reforms continue to be implemented. This report is the third in a series of reports, jointly produced by WHO and the World Bank, assessing progress in reforming Ukraine’s health financing system since the reforms were launched in 2017.

“Ukraine has sustained the universal health coverage through the Program of Medical Guarantees, ensuring that all citizens can access essential health services while strengthening protection against financial burden,” said Dr Jarno Habicht, WHO Representative in Ukraine. "Through regional consultations, joined by local stakeholders across 10 Ukrainian oblasts, we have gathered local perspectives on the implementation of health financing reforms in Ukraine and explored ways forward. These consultations are crucial for tailoring health financing to meet regional needs, especially in frontline areas affected by the war. By adapting reforms to local contexts, we ensure that health systems not only remain functional but also play a vital role in supporting recovery where it is most needed."

“Improving people’s health should be the main objective of health systems everywhere. This also includes making sure that we are protecting people from the often severe financial burden of out-of-pocket payments for medicines or other health costs,” said Dr Natasha Azzopardi Muscat, WHO/Europe’s Director of Country Health Policies and Systems at the launch event. “This new report shows that effective health financing is key to achieving these goals—efficiency, transparency, accountability, and most importantly, equity when it comes to ensuring affordable access to health care. As Ukraine’s health system continues to face extraordinary challenges, resilience and equity in health financing are more important than ever to provide everyone, everywhere with the care they need it, whenever they need it.”

“It is encouraging to see the Government’s commitment to the ongoing implementation of these ambitious health sector reforms to increase the efficiency of Ukraine’s healthcare system,” said Bob Saum, World Bank Country Director for Eastern Europe. “In the context of challenging budgetary restraints, improving the efficiency of public financing for health is the only way to ensure that Ukraine can look after its people, whose healthcare needs are growing as a direct result of Russia’s invasion. The continued rollout of these reforms will also prove critical for the modernization of the health system in line with Ukraine’s ambition to join the European Union.” 

“The task, which Ukraine's healthcare system has been for almost three years now, is to combine the priorities of peaceful life with the challenges of war, ensuring that Ukrainians have universal access to quality, affordable, and free medical care. And our healthcare system is managing this task. In particular, thanks to changes in financing approaches, which allow us to be adaptive and flexible in decision-making. Despite the war, we continue implementing reforms: last year, we completed the formation of a capable network of healthcare facilities, allowing for more efficient use of available resources. The state budget for 2025 envisages a significant increase in healthcare spending: an additional 6.3 billion UAH will be directed to expand the “Affordable Medicines” Program and modernize medical infrastructure. The total amount of expenditures will exceed 217 billion UAH, of which more than 175.5 billion UAH will be allocated to finance the Program of Medical Guarantees, which is 16.8 billion UAH more than last year. Regular progress reports on the implementation of health financing reforms in Ukraine by WHO and the World Bank serve as a kind of compass, helping us understand whether we are moving in the right direction. The positive assessments I heard today motivate us to work even harder to strengthen the resilience of the healthcare system,” said Viktor Liashko, Minister of Health of Ukraine.

The report highlights that health financing reforms, initiated in Ukraine in 2017 are on the right track. These reforms have played a critical role in strengthening the resilience of the health system during the COVID-19 pandemic and the war. The report underscores the importance of safeguarding public financing and investment in health, particularly in the challenging war context. Preserving human capital is essential for Ukraine’s long-term economic recovery and social cohesion.

However, the fiscal space for government health spending will remain limited due to the war’s economic impact and the need to prioritize defense and security spending. Moving forward, health financing reforms need to prioritize efficiency of spending, maximizing health for the money while also emphasizing equity in access, financial protection against catastrophic out-of-pocket payments, and improving quality of services. 

The review recommends several policies and actions from a health financing toolkit to help take reforms forward, and improve health system performance across these key health financing objectives.

Strengthening primary health care (PHC)

Strong PHC is important for efficiency and equity of health system. The review recommends actions to make it easier for the people to sign-up and change their PHC providers, to support sustainable financing of PHC, implement incentives for improved performance, update clinical guidelines to improve quality and cost-effectiveness of care, provide additional measures to support PHC in the areas of high IDP concentration as well in war-affected areas with very low population. 

As PHC is the gateway to the rest of the health system for the population, the report highlights that Ukraine needs to build on its success of 86% of population having signed declarations with PHC providers and achieve universal registration. Internally displaced people require special attention to ensure their access to PHC as less than 20% of IDPs had changed their registration to a provider at their new location.

Ensuring transparent and accountable institutions

The report suggest that the National Health Service of Ukraine (NHSU) can step up policies and actions as a more proactive purchaser of services based on oblast level health needs assessments, increasing NHSU capacity in regional offices, consolidating purchasing of complex services in higher volume and better quality facilities while maintaining geographical access for population, and improving financial incentives for efficiency and quality.

Strong, transparent and accountable institutions are crucial for reform success. The review recommends establishing a governance body for strategic oversight over PMG processes and NHSU performance; and, to revise regulations and internal procedures to ensure transparent, evidence-informed, formal and timely processes for decision making concerning the PMG. To be able to execute its functions properly, the NHSU needs to be adequately resourced beyond the current 0.11% of total PMG expenditures, 10 times less than in comparable European countries.

The report also outlines policy considerations for Ukraine to "build back better," with a focus on modernizing health service delivery, optimizing hospital networks, and strengthening institutions.

Background information:

While developing the report, multiple discussions were held between WHO and the World Bank experts, including meetings held in Barcelona in October 2023, Kyiv in January 2024 and Vienna in April 2024. Additional technical consultations were organized with national authorities including the Ministry of Health of Ukraine, the National Health Service of Ukraine and the Ministry of Finance of Ukraine.

Additionally, WHO and the World Bank held regional roundtables in Odesa, Dnipro, and Kyiv in July 2024 to gather local insights on the implementation of the health financing reform in Ukraine. These regional consultations brought national and local policy-makers, primary health care and specialized care providers, and health facility owners from ten Ukrainian regions, including Odesa, Mykolaiv, Kherson, Dnipro, Zaporizhzhia, Kharkiv, Lviv, Rivne, Vinnytsia, Poltava to discuss primary and specialized care financing, the implementation of the Affordable Medicines Programme, and the role of the NHSU. Feedback from these discussions has been incorporated into this third joint health financing review - a series of reports, jointly produced by WHO and the World Bank, assessing the progress in health financing reforms, since their launch in Ukraine in 2017.

Key takeaways from the consultations:

• The ongoing war impacts regions differently.
• Health financing adjustments are needed for more affected areas.
• Sufficient and equitable financing for PHC, including affordable medicines, delivers the best value for money.
• Developing a capable provider network is an opportunity for better quality and efficiency.
• Stronger NHSU interregional presence would enable more effective regional communication on health needs and provider capacities.

The report has been produced with the financial support from the Swiss Agency for Development and Cooperation through the “Sustaining Health Sector Reform in Ukraine” project; the Government of Canada, and the European Union as part of the project “Health System Development in Ukraine” and within the Universal Health Coverage Partnership.

To access the report, please follow the link.