World Bank Supports Health of Romanians

WASHINGTON, March 28, 2014 – The World Bank’s Board of Executive Directors approved a EUR250 million loan to Romania for the Health Sector Reform – Improving Health System Quality and Efficiency project, which will be implemented by the Romanian Ministry of Health.

The new project is consistent with the priorities of the World Bank’s strategic partnership in Romania, as well as with the European Commission and International Monetary Fund programs.

This new health sector operation aims to improve the access, quality, and efficiency of public health services by supporting the health care service delivery network by strengthening the hospitals’ support systems and services, increasing outpatient medical care services (higher volume–lower cost–greater quality), enhancing primary health care services at the community level, and strengthening governance across the health care system. The project focuses on prevention and out-of-hospital assistance as the most cost-effective way to improve health outcomes.

Romania has achieved progress in improving its healthcare systems, but is still facing several challenges. In terms of health outcomes, the health system is below EU standards. Romania has the highest infant mortality rate in the EU, with 9.8 per 1,000 live births – more than twice the EU rate of 4.1 per 1,000. Life expectancy is 73.8 years – about 6 years lower than the EU average. Romania also has one of the highest standardized death rates for cardiovascular disease – due to lack of prevention and to smoking related causes.

Romania has historically committed a relatively low share of national spending to health care. Health care spending in the public sector has increased from 2.9 to 3.7 percent of GDP, but still remains well below other EU countries. In order to improve, the following will be needed:

• The use of expensive health technologies, both in terms of medical procedures and drugs, will need to be properly analyzed and regulated.
• The use of health technology assessments approved by the Government in 2012 has to be expanded, further developed, and enforced.
• New quality control mechanisms have to be developed and implemented, and the hospital financial discipline improved.
• A perception shift from the focus on in-hospital assistance and the public’s behavior change are also needed.

“The health sector in Romania still remains underfinanced.  And in a fiscally-constrained environment, it is especially important to improve efficiency in the sector,” said Elisabetta Capannelli, World Bank Country Manager for Romania. “Romanian patients need to be able to access health services with ease. Better and more uniform quality of services needs to be ensured for all patients. Decentralization of hospital services often leads to fragmentation of policies and of the delivery of health care services. In order to avoid this, the hospital networks need to be established quickly, followed by proper patient referral mechanisms and a focus on primary care and out-patient services.”

Previous World Bank assistance includes a Health Services Rehabilitation Project and a Health Adaptable Program Lending series (APL 1 and 2). Bank projects have complemented the existing partnerships between the Government, WHO, UNICEF, UNFPA and bilateral donors, including USAID and Swiss Cooperation.

This loan’s interest rate is equal to six month Euribor plus a variable spread. The repayment period is 18 years, with a 17.5 years grace period. After Board’s approval, the loan agreement will be signed by both sides and ratified according to Romanian law. The Project is expected to become effective no later than 150 day after signing, and be implemented over 6 years.