EU Healthcare Costs: A Closer Look at Out-of-Pocket Payments

The European Union asserts that healthcare access is a basic human right. However, the question remains: who bears the financial burden?

As per Eurostat, mandatory health insurance contributions comprise slightly over half (51%) of overall health expenditure in the EU. Government funding contributes around 30%, while households cover about 15% through direct payments.

This translates to households typically spending €15 for every €100 they allocate toward healthcare.

So, how do out-of-pocket expenses vary across European countries? And what portion do these payments represent in the overall healthcare spending?

Data from Eurostat reveals that as of 2024, or the closest year available, household contributions to healthcare costs ranged from 8.5% in Luxembourg to 35.5% in Bulgaria.

The analysis encompassed 34 European nations.

Notably, Latvia (35.1%), Greece (34.3%), Serbia (32.1%), Lithuania (31.4%), and Bosnia and Herzegovina (31%) also show figures exceeding 30% in out-of-pocket spending.

Dr. Joseph Piscopo, a health economist with Malta’s Ministry of Health, noted that Eastern and Southern European nations often report higher out-of-pocket expenses compared to total health spending.

“Countries with robust economies can allocate more resources to healthcare, consequently reducing out-of-pocket costs,” he explained to Euronews Health.

Besides Luxembourg, France (8.9%), Croatia (9.4%), Ireland (10.6%), and Germany (10.7%) have among the lowest household contributions.

When looking at Europe’s largest economies, Italy stands out with a higher share of 22.3%, followed closely by Spain at 20.9%.

France and Germany, in contrast, are among the five countries with the lowest shares. Although the data originates from 2019, the UK is near the EU average, reported at 15.9%.

In three Nordic countries, the out-of-pocket proportions are lower than the EU average: Sweden (13.4%), Denmark (13.9%), and Norway (14.1%). Finland (16.1%) slightly exceeds the EU average.

Compensation Policies in Focus

Jonathan Silas, a visiting professor at the London School of Economics, pointed out that national health insurance frameworks—defining coverage, included services, and the extent of healthcare—play a crucial role in these discrepancies between nations.

“In many economically challenged countries, such as Bulgaria, those who do not contribute to social insurance are excluded from public coverage, forcing them to pay for medical care entirely out of pocket,” he shared.

Pascal Garrel, head of the European Hospital and Healthcare Federation, indicated that countries with extensive public and social health insurance generally report lower out-of-pocket costs. These systems often provide comprehensive benefits that cover most services, including inpatient care, primary visits, and prescriptions.

Moreover, they tend to have low or no fees for essential services and robust protections for vulnerable groups like low-income individuals, the elderly, and those with chronic conditions, exemplified by nations like France, Germany, and Sweden.

Garrel added that countries with the highest out-of-pocket shares, like Bulgaria and Greece, usually have narrower public benefit packages, with limited coverage for outpatient medications, dental care, and diagnostic tests, along with insufficient safeguards against catastrophic health expenditures.

Annual Out-of-Pocket Payments Per Person

Eurostat projects that in 2023—or the nearest available year—EU citizens will spend an average of €542 per year on healthcare expenses out of their own pockets. The financial range across 34 European countries spans from €116 in Moldova to €2,396 in Switzerland.

In EU member states, the figures vary from €136 in Croatia to €1,176 in Belgium. Notably, Norway (at €1,158) also surpasses €1,000 annually.

“Wealthy Western European and Nordic nations are ramping up investments in advanced healthcare, which pushes per capita spending upwards,” Garrel noted.

Besides Moldova and Croatia, people in Bosnia and Herzegovina (€206), Romania (€223), Poland (€232), and Serbia (€293) have annual healthcare payments below €300.

France’s Out-of-Pocket Costs

Among Europe’s major economies, France records the lowest out-of-pocket medical expenditures at €410 a year, making it the only country below the EU average.

In comparison, the highest expenses are recorded in Italy at €718, followed by Germany (€652), the UK (€609 based on 2019 data), and Spain (€596).

Garrel highlighted that demographic trends and health conditions also affect spending patterns. Countries with aging populations and high rates of chronic illnesses, like Italy and Germany, are likely to face increased demand for both medical and long-term care.

“Countries with younger demographics and shorter life expectancies typically spend less, which often isn’t due to lower needs but, rather, underutilization of healthcare,” he noted.

The Purchasing Power Parity Perspective

When looking at purchasing power standards (PPS), the difference in out-of-pocket payments among countries narrows. PPS serves as a theoretical monetary unit designed for price comparisons across economies. According to Eurostat, one unit of currency can purchase an equivalent amount of goods and services in each country.

In terms of PPS, per capita out-of-pocket payments fluctuate from €191 in Croatia to €1,304 in Switzerland.

Some rankings shift considerably when assessed in PPS rather than in Euros. For instance, in Bulgaria, the amount stands at €413 when measured in PPS, equivalent to 740 euros.