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Hungary's Health Fund in surplus for 1st time

Hungary's national health insurance fund had a surplus in the Q1 of the year for the first time in the 17 years since the fall of communism, business daily Napi Gazdaság reported on Thursday.

The surplus followed government reforms which stemmed the rise in spending on drug subsidies and health care provision by making people pay to visit the doctor and drastically reduced drug subsidies. The insurance fund recorded a Ft 17 billion ($93.13 million) surplus in the first three months, said Zoltán Major, general director of the National Health Insurance Fund. "This is negligible compared to the total 1,600 billion forint health budget, but it gives reason for definite optimism," Major told Napi Gazdaság. The number of hospital outpatient visits has dropped by 60% since the February 15 introduction of doctor visiting fees and hospital fees, another daily, Magyar Hirlap, reported.

Health reform is one of the key planks of the Hungarian government's plans to reduce its budget deficit, which in 2006 hit almost 10% of GDP. The health fund's overshooting spending targets has been a contributor to the country's budget woes. "This is the first result of this year's health reforms which can be shown in numbers," Major said. Further cost-cutting measures have been announced, with the closure of almost 9,000 of 80,000 hospital beds. Other measures are planned, although some have fallen foul of grass-roots opposition in the Socialist Party, the main element in the governing coalition.

Health Minister Lajos Molnár resigned last week saying he could not accept any further delay in the decision about transforming the insurance system. Molnár's party, the liberal Alliance of Free Democrats wants a multiple insurer model so as to reduce the costs for the state, but Prime Minister Ferenc Gyurcsány's Socialist Party wants to slow changes, fearing a market-based model would hurt their older, poorer voters. (