Health care costs continue to rise in municipalities

’s healthcare costs have been rising for years, and there is no end in sight, according to the basic healthcare cost comparison conducted by the Association of Municipalities (AFLRA) in June.

The report showed that healthcare costs rose significantly last year compared to 2020, especially in big cities.

Costs per inhabitant rose the most in (8.2 percent), (8.0 percent) and (6.7 percent), the least in Lahti (2.1 percent).

State compensate part of the increased expenses of the municipalities. In 2021, state support for treatment costs related to the was more than one billion euros. In addition, state subsidies to municipalities were increased by more than 300 million euros.

Two extraordinary years

By Maria PernuAFLRA’s social and health affairs expert, municipalities have had two very exceptional years. "The costs have already been high and have continued to rise. However, there is no single reason behind the increase; it is a combination of factors," Pernu pointed out.

The first year of the Covid left behind a huge debt from healthcare services, which the municipalities tried to cover last year. In addition, the pandemic increased the demand for child protection, mental health and substance services, which increased costs.

In addition to this, prices have risen, and has increased the total cost of services.

Costs will also rise partly due to the lack of personnel. "Many municipalities have had to hire personnel because they have had difficulty finding their own employees. This has increased wage costs," Pärnu said.

Part of a wider trend

The increase in the costs of municipal healthcare is part of a wider trend – healthcare costs in Finland have been on the rise for decades. According to preliminary data from the Finnish Institute of Health and Welfare (), health care expenditures in Finland in 2020 will be almost 23 billion euros, or 9.6 percent of the country’s gross domestic product. By way of comparison, in 2000 the expenses were around 9.7 billion euros and 7.1 percent of the gross domestic product.

Starting next year, the responsibility for organizing health care will be transferred to self-governing welfare service municipalities with the new health care, social and rescue service reform. One of the goals of the reform is cost containment.

However, Minna PunakallioAFLRA’s Chief Economist says there are a number of complex issues in welfare councils that need to be addressed first.

“They should at least address the rising cost pressures caused by the aging of the population,” Punakallio pointed out.

In addition to expanding the tasks of the welfare regions, the new regions also have to deal with the harmonization of wages and various relocation costs, Punakallio said.

Source: The Nordic Page

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