Croatia: Health system review

Full text

Luka Voncina, Nadia Jemiai, Sherry Merkur, Christina
Golna, Akiko Maeda, Shiyan Chao, Aleksandar Dzakula
Croatia: health system review
Article (Published version)
(Refereed)
Original citation:
oncina, Luka and Jemiai, Nadia and Merkur, Sherry and Golna, Christina and Maeda, Akiko and
Chao, Shiyan and Dzakula, Aleksandar (2006) Croatia: health system review. Health systems in
transition, 8 (7). pp. 1-108.
© 2006 World Health Organization
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Vol. 8 No. 7 2006
Luka Voncina • Nadia Jemiai
Sherry Merkur • Christina Golna
Akiko Maeda • Shiyan Chao
Aleksandar Dzakula
Editors: Sherry Merkur • Nadia Jemiai
Elias Mossialos
Health Systems in Transition
Croatia
Health system review

Editorial Board
Editor in chief
Elias Mossialos, London School of Economics and Political Science, United Kingdom
and European Observatory on Health Systems and Policies
Editors
Reinhard Busse, Berlin Technical University, Germany
Josep Figueras, European Observatory on Health Systems and Policies
Martin McKee, London School of Hygiene and Tropical Medicine, United Kingdom and
European Observatory on Health Systems and Policies
Richard Saltman, Emory University, United States
Editorial team
Sara Allin, European Observatory on Health Systems and Policies
Olga Avdeeva, European Observatory on Health Systems and Policies
Anna Maresso, European Observatory on Health Systems and Policies
David McDaid, European Observatory on Health Systems and Policies
Sherry Merkur, European Observatory on Health Systems and Policies
Bernd Rechel, European Observatory on Health Systems and Policies
Erica Richardson, European Observatory on Health Systems and Policies
Sarah Thomson, European Observatory on Health Systems and Policies
International advisory board
Tit Albreht, Institute of Public Health, Slovenia
Carlos Alvarez-Dardet Díaz, University of Alicante, Spain
Rifat Atun, Imperial College London, United Kingdom
Johan Calltorp, Swedish Association of Local Authorities and Regions, Sweden
Armin Fidler, The World Bank
Colleen Flood, University of Toronto, Canada
Péter Gaál, Semmelweis University, Hungary
Unto Häkkinen, Centre for Health Economics at Stakes, Finland
William Hsiao, Harvard University, United States
Alan Krasnik, University of Copenhagen, Denmark
Joseph Kutzin, World Health Organization Regional Office for Europe
Soonman Kwon, Seoul National University, Korea
John Lavis, McMaster University, Canada
Vivien Lin, La Trobe University, Australia
Greg Marchildon, University of Regina, Canada
Alan Maynard, University of York, United Kingdom
Nata Menabde, World Health Organization Regional Office for Europe
Ellen Nolte, London School of Hygiene and Tropical Medicine, United Kingdom
Charles Normand, University of Dublin, Ireland
Robin Osborn, The Commonwealth Fund, United States
Dominique Polton, National Health Insurance Fund for Salaried Staff (CNAMTS), France
Sophia Schlette, Health Policy Monitor, Germany
Igor Sheiman, Higher School of Economics, Russia
Peter C. Smith, University of York, United Kingdom
Wynand P.M.M. van de Ven, Erasmus University, The Netherlands
Witold Zatonski, Marie Sklodowska-Curie Memorial Cancer Centre, Poland

The European Observatory on Health Systems and Policies is a partnership
between the World Health Organization Regional Office for Europe, the
Governments of Belgium, Finland, Greece, Norway, Slovenia, Spain and
Sweden, the Veneto Region of Italy, the European Investment Bank, the Open
Society Institute, the World Bank, the London School of Economics and Political
Science, and the London School of Hygiene & Tropical Medicine.
2006
Health Systems
in Transition
Written by
Luka Voncina, Andrija Stampar School of Public Health
Nadia Jemiai, European Observatory on Health Systems and Policies
Sherry Merkur, European Observatory on Health Systems and Policies
Christina Golna, European Observatory on Health Systems and Policies
Akiko Maeda, World Bank
Shiyan Chao, World Bank
Aleksandar Dzakula, Andrija Stampar School of Public Health
Edited by
Sherry Merkur, European Observatory on Health Systems and Policies
Nadia Jemiai, European Observatory on Health Systems and Policies
Elias Mossialos, European Observatory on Health Systems and Policies
Croatia:
Health System Review

© World Health Organization 2006, on behalf of the European Observatory on Health Systems and Policies
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Keywords:
DELIVERY OF HEALTH CARE
EVALUATION STUDIES
FINANCING, HEALTH
HEALTH CARE REFORM
HEALTH SYSTEM PLANS – organization and administration
CROATIA
ISSN 1817-6127 Vol. 8 No. 7
Suggested citation:
Voncina L, Jemiai N, Merkur S, Golna C, Maeda A, Chao S, Dzakula A. Croatia:
Health system review. Health Systems in Transition, 2006; 8(7): 1–108.
Printed and bound in the United Kingdom by TJ International, Padstow, Cornwall.

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Contents
Preface ............................................................................................................ v
Acknowledgements ...................................................................................... vii
List of abbreviations...................................................................................... ix
List of tables and figures ............................................................................... xi
Abstract ....................................................................................................... xiii
Executive summary ...................................................................................... xv
1. Introduction and historical background ..................................................... 1
1.1 Introductory overview .................................................................... 1
1.2 Historical background .................................................................. 10
2. Organizational structure and management ............................................... 17
2.1 Organizational structure of the health care system ...................... 17
2.2 Planning, regulation and management ......................................... 20
2.3 Decentralization of the health care system .................................. 22
3. Health care financing and expenditure ..................................................... 23
3.1 Main system of financing and coverage ...................................... 23
3.2 Complementary sources of financing .......................................... 35
3.3 Health care expenditure ............................................................... 40
4. Health care delivery system ..................................................................... 43
4.1 Public health services .................................................................. 43
4.2 Primary health care ...................................................................... 59
4.3 Secondary and tertiary care ......................................................... 64
4.4 Social care .................................................................................... 66
4.5 Mental health ............................................................................... 71
4.6 Human resources and training ..................................................... 73
4.7 Pharmaceuticals ........................................................................... 75
4.8 Health technology assessment ..................................................... 80

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5. Financial resource allocation ................................................................... 83
5.1 Third-party budget setting and resource allocation ..................... 83
5.2 Payment of secondary and tertiary care providers ....................... 85
5.3 Payment of primary care physicians ............................................ 87
6. Health care reforms .................................................................................. 89
6.1 Health care reform 2002 .............................................................. 89
6.2 2006 National strategy for the development of the
health care system ........................................................................ 92
7. Conclusions .............................................................................................. 97
8. Appendix .................................................................................................. 99
8.1 References ................................................................................... 99
8.2 Useful web sites ......................................................................... 103
8.3 HiT methodology and production process ................................. 104

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Preface
The Health Systems in Transition (HiT) profiles are country-based reports
that provide a detailed description of a health system and of reform
and policy initiatives in progress or under development in a specific
country. Each profile is produced by country experts in collaboration with the
Observatory’s research directors and staff. In order to facilitate comparisons
between countries, the profiles are based on a template, which is revised
periodically. The template provides detailed guidelines and specific questions,
definitions and examples needed to compile a profile.
HiT profiles seek to provide relevant information to support policy-makers
and analysts in the development of health systems in Europe. They are building
blocks that can be used:
to learn in detail about different approaches to the organization, financing
and delivery of health services and the role of the main actors in health
systems;
to describe the institutional framework, the process, content and
implementation of health care reform programmes;
to highlight challenges and areas that require more in-depth analysis;
to provide a tool for the dissemination of information on health systems and
the exchange of experiences of reform strategies between policy-makers and
analysts in different countries.
Compiling the profiles poses a number of methodological problems. In
many countries, there is relatively little information available on the health
system and the impact of reforms. Due to the lack of a uniform data source,
quantitative data on health services are based on a number of different sources,
including the World Health Organization (WHO) Regional Office for Europe
European Health for All database, national statistical offices, Eurostat, the
•
•
•
•

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Health systems in transition Croatia
Organisation for Economic Co-operation and Development (OECD) Health
Data, the International Monetary Fund (IMF), the World Bank, and any other
relevant sources considered useful by the authors. Data collection methods and
definitions sometimes vary, but typically are consistent within each separate
series.
A standardized profile has certain disadvantages because the financing and
delivery of health care differ across countries. However, it also offers advantages,
because it raises similar issues and questions. The HiT profiles can be used to
inform policy-makers about experiences in other countries that may be relevant
to their own national situation. They can also be used to inform comparative
analysis of health systems. This series is an ongoing initiative and material is
updated at regular intervals.
Comments and suggestions for the further development and improvement of
the HiT series are most welcome and can be sent to: info@obs.euro.who.int.
HiT profiles and HiT summaries are available on the Observatory’s web site
at www.euro.who.int/observatory. A glossary of terms used in the profiles can
be found at the following web page: www.euro.who.int/observatory/glossary/
toppage.

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Acknowledgements
The Health Systems in Transition Profile on Croatia was written by Luka
Voncina (Andrija Stampar School of Public Health), Nadia Jemiai
(European Observatory on Health Systems and Policies), Sherry Merkur
(European Observatory on Health Systems and Policies), Christina Golna
(European Observatory on Health Systems and Policies), Akiko Maeda (World
Bank), Shiyan Chao (World Bank) and Aleksandar Dzakula (Andrija Stampar
School of Public Health). The editors of the Croatia HiT were Sherry Merkur,
Nadia Jemiai and Elias Mossialos (European Observatory on Health Systems
and Policies).
The European Observatory on Health Systems and Policies is grateful to
Miroslav Mastilica (Andrija Stampar School of Public Health), Shiyan Chao
(World Bank), and Marija Strnad (Croatian National Institute of Public Health)
for reviewing the report.
The current series of HiT profiles has been prepared by the research directors
and staff of the European Observatory on Health Systems and Policies. The
European Observatory on Health Systems and Policies is a partnership between
the WHO Regional Office for Europe, the Governments of Belgium, Finland,
Greece, Norway, Slovenia, Spain and Sweden, the Veneto Region of Italy, the
European Investment Bank, the Open Society Institute, the World Bank, the
London School of Economics and Political Science, and the London School
of Hygiene & Tropical Medicine.
The Observatory team is led by the director, Josep Figueras, co-director, Elias
Mossialos, and by Martin McKee, Richard Saltman and Reinhard Busse, heads
of the research hubs. Technical coordination is led by Susanne Grosse-Tebbe.

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Giovanna Ceroni managed the production and copy-editing, with help from
Nicole Satterley and with the support of Shirley and Johannes Frederiksen
(layout).
Special thanks are extended to the WHO European Health for All database,
from which data on health services were extracted; to the OECD for the data
on health services in western Europe; and to the World Bank for the data on
health expenditure in central and eastern European countries. Thanks are also
due to the Croatian Bureau of Statistics and the Croatian National Institute for
Public Health, which have provided additional country-level data.
This report reflects data publicly available in January 2006.

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List of abbreviations
AIDS Acquired immunodeficiency syndrome
CDC United States Centers for Disease Control and Prevention
CEFTA Central European Free Trade Agreement
CERANEO Centre for Development of Non-Profit Organisations
CIA Central Intelligence Agency
CINDI Countrywide Integrated Noncommunicable Disease Intervention
CIT Croatian Institute of Toxicology
CME Continuing medical education
DRGs Diagnosis-related groups
ENHPS European Network of Health Promoting Schools
ESPAD European School Survey Project on Alcohol and other Drugs
EU European Union
EURACT European Academy of Teachers in General Practice
EUROHIS European Health Interview Survey
GDP Gross domestic product
GFATM Global Fund to Fight AIDS, Tuberculosis and Malaria
GNP Gross national product
GP General practitioner
GYTS Global Youth Tobacco Survey
HAART Highly active antiretroviral therapy
HDZ Croatian Democratic Union
HiT Health Systems in Transition
HRK Croatian kuna (currency)
HZJZ Croatian National Institute of Public Health
HZZO Croatian Health Insurance Institute
IMF International Monetary Fund
NATO North Atlantic Treaty Organisation
NGOs Nongovernmental organizations
OECD Organisation for Economic Co-operation and Development

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Health systems in transition Croatia
PfP Partnership for Peace
PPTP Procedures Paid by the Therapy Procedure [translation from Croatian]
PTCA Percutaneous transluminal coronary angioplasty
PTSD Post-traumatic stress disorder
TB Tuberculosis
UNICEF United Nations Children’s Fund
VCT Voluntary counselling and testing
WHO World Health Organization
WTO World Trade Organization

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List of tables and figures
Tables
Table 1.1 Population and gender distribution, population estimates, 1995–2004 3
Table 1.2 Percentage of the population by age group in Croatia and the EU, 2003
or latest available year (in parentheses)
3
Table 1.3 Population distribution, demographic dependency ratio, and population
growth rate (thousands), 1995–2004
4
Table 1.4 Live births, deaths and natural increase (rate per 1000 population),
1995–2004
4
Table 1.5 Marriages and divorces, 1995–2003 5
Table 1.6 Population and households by census, selected years 5
Table 1.7 Macroeconomic context, 1996–2004 8
Table 1.8 Employment by sector, 2004 9
Table 1.9 Trade and balance of payments (US$ millions) 9
Table 3.1 Definitions of health insurance terminology in the EU and Croatia 24
Table 3.2 Sources of revenue reported by health care providers in 2001 25
Table 3.3 The structure of HZZO expenditure as a percentage of GDP, 1994–2002 26
Table 3.4 HZZO revenue and expenditure, 1998–2002 in US$ millions 26
Table 3.5 Annual real increase in HZZO expenditure over preceding year,
1998–2002
27
Table 3.6 Comparison of health insurance contributions in selected central
European countries
30
Table 3.7 Changes in co-payment exemptions and central and local government
contribution policies under the new Health Insurance Law 2002
34
Table 3.8 Mean household spending on health, in HRK (US$), 2001 36
Table 3.9 Household health expenditure by income quintile groups, in HRK (US$),
2001
37
Table 3.10 Household health expenditure by welfare status, in US$, 2001 37
Table 3.11 Distribution of relative health expenditure by social welfare status, 2001 38
Table 3.12 Estimated total spending on health, as a percentage of GDP,
1998–2002
41
Table 3.13 Per-capita spending on health (total, private and public), 1997–2002, in
constant HRK (1997 prices (US$))
42

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Table 3.14 Comparison of health spending by function, Croatia and selected
European countries
42
Table 4.1 Inpatient utilization and performance in acute hospitals in the WHO
European Region, 2004 or latest available year
67
Table 4.2 HZZO expenditure on prescription drugs, 1997–2002 in HRK millions
(US$ millions)
80
Table 5.1 Comparison of United States DRGs, Australian DRGs and Croatian
PPTPs for open-heart surgery
86
Figures
Fig. 1.1 Map of Croatia 2
Fig. 1.2 Life expectancy at birth, 2004 (or latest available year) 11
Fig. 1.3 Life expectancy at age 65, 2004 (or latest available year) 12
Fig. 2.1 Organizational chart of the social protection system 18
Fig. 3.1 Beneficiary composition, 1995 and 2002 28
Fig. 3.2 Relationship between voluntary and statutory health insurance,
1993–2004
39
Fig. 4.1 Levels of immunization for measles in the WHO European Region,
2004
48
Fig. 4.2 Food-borne disease outbreaks and cases reported, 1993–2000 50
Fig. 4.3 Number of GPs per 100 000 population, 2004 or latest available year 61
Fig. 4.4 Population pyramids, 2000 and 2030 68
Fig. 4.5 Population forecast in thousands, 2000–2030 69
Fig. 4.6 Nursing staff per 100 000 population, 2004 or latest available year 74
Fig. 4.7 Dentists per 1000 population, 2004 or latest available year (in
parentheses)
76
Fig. 4.8 Pharmacists per 1000 population, 2004 or latest available year (in
parentheses)
77
Fig. 4.9 Number and average cost of drug prescriptions covered by the HZZO,
1994–2002
81
Fig. 5.1 Third-party budget setting 84
Boxes
Box 3.1 System of Health Accounts and definition of health expenditure 28
Box 5.1 Trends in primary care service provision between 1990 and 2003 88
Box 6.1 Problems and reform objectives identified by the Ministry of Health,
2001
90

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Abstract
The Health Systems in Transition (HiT) profiles are country-based reports
that provide a detailed description of a health system and of policy
initiatives in progress or under development. HiTs examine different
approaches to the organization, financing and delivery of health services and the
role of the main actors in health systems; describe the institutional framework,
process, content and implementation of health and health care policies; and
highlight challenges and areas that require more in-depth analysis.
Croatia is a European country in transition with a population of 4.4
million. The population generally enjoys good health and an increasing life
expectancy of less than three years below the European Union (EU) average.
Croatia’s health system is based on the principles of inclusivity, continuity
and accessibility. Croatia spends a relatively high share of its gross domestic
product (GDP) on health. Public funds for health care originate from two main
sources: contributions for mandatory health insurance (predominantly) and
funds collected by general taxation. The network of health care providers is
organized in a way that makes it accessible to all citizens. The Croatian health
system has good health outcomes in relation to countries at comparable income
levels. Provision and funding of services are largely public, although private
providers and insurers also increasingly operate in the market. Since 1991, the
Croatian health system has been subject to a range of organizational reforms.
These have mostly relied on decreasing public and increasing private expenditure
in the system. While reforms have, up to a point, managed to decrease public
spending on health care, they have failed to adequately address issues such as
growing arrears and productivity. Important actions involving strengthening
policy, monitoring, regulation and more advanced supply-side-oriented tools
remain to be prioritized and implemented.

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Executive summary
Croatia is a country in central Europe, covering an area of 56 542 km²
and with 5835 km of coastline. Croatia has an important geographical
position, being located between central Europe and the Mediterranean.
Main international land transport routes pass through the country from western
Europe to the Aegean Sea and the Turkish Straits. The importance of Croatia’s
geographical position is further enhanced by its proximity to the Adriatic Sea,
the northernmost gulf of the Mediterranean.
In 2004, the total population was 4.4 million and the population density was
78.5 inhabitants per km². The proportion of the population aged 65 and over
(16.64% in 2004) is approximately equal to the European Union (EU) average.
Depopulation trends started in 1991. In 2003, the population increase was
negative (–2.9), the lowest since the establishment of independence in 1990.
Croatia’s political system is a parliamentary democracy established by the
Constitution of 22 December 1990. The first democratic multiparty elections
took place in April 1990 when the Croatian Democratic Union defeated the
Communist Party and was elected the party of the Government. Croatia’s
foreign policy priorities focus on developing closer relations with international
organizations, a goal towards which rapid progress has been made. Croatia is
a member of the Council of Europe and the United Nations and its specialized
agencies. It joined the World Bank in 1993, and the Partnership for Peace (PfP)
North Atlantic Treaty Organisation (NATO) Arrangement and the World Trade
Organization (WTO) in 2000. In October 2005, Croatia started negotiations
towards joining the EU. Since June 1994 the national currency is the kuna
(HRK).
The five years of war from 1991 to 1996, following Croatia’s declaration of
independence, caused important demographic losses and left deep psychological
scars. War damages, including considerable damage to the country’s housing

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and public services infrastructure, were estimated at €32.6 billion, two-thirds
of which was direct material damage. Up to 20 000 people have been reported
killed or missing, and more than 30 000 people have been disabled as a result of
the war. Approximately 47.5% (27 000 km²) of the Croatian continental territory
containing some 1.5 million inhabitants was affected by the war. The national
economy suffered accordingly. Prior to the dissolution of Federal Yugoslavia,
Croatia, after Slovenia, was the most prosperous and industrialized republic in
the federation. The per-capita output was approximately one third above the
Yugoslav average. During the war the economy went into recession. By 1993,
gross national product (GNP) was at 68% of its pre-war level. The country also
suffered heavy inflation.
Nonetheless, there were concentrated efforts to implement structural and
economic reforms. The monetary reform in 1993, which has been described as
“one of the most successful exchange rate-based stabilization programmes in
the region”, led to moderate inflation rates and a stabilization of the national
economy. Economic reforms have focused on fully establishing market
economy structures, including deregulation and the introduction of the necessary
privatization trends in the public sector, liberalization of international trade,
etc.
In 2004, Croatia had an average life expectancy at birth of 75.66 years for
both sexes; 71.13 years for males and 79.08 years for females. However, this
figure is still lower than in western Europe and 2.8 years below the EU average
of 78.49 years in 2004. Infant mortality has gradually declined from 8.1 infant
deaths per 1000 live births in 1996 to 6.08 per 1000 live births in 2004 but is
still higher than the EU average of 4.75. Croatia shares the disease prevalence
pattern of other European countries: cardiovascular diseases, cancer, mental
health problems, injuries and violence, and respiratory diseases represent the
most prominent causes of morbidity and mortality.
The Croatian health system has fared relatively well among the countries in
the region: the system has a well-trained health workforce, a well-established
system of public health programmes and health delivery system, and good health
outcomes in relation to countries at comparable income levels. However, these
results have been achieved at a high cost and the Health Insurance Fund has
faced growing deficits in recent years. The generous benefits and exemptions
have been politically difficult to roll back, while the ageing population and rising
costs of health care have contributed to a rapid increase in public spending on
health.
Croatia operates a social health insurance system. However, public funds for
health care originate from two main sources: contributions for mandatory health
insurance and funds collected by general taxation. Both form part of the State’s

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annual budgetary contribution towards health care, which is annually determined
by the Ministry of Health and Social Welfare and the Ministry of Finance,
and ratified by the Parliament. Thus, as elsewhere in social health insurance
countries, the funding of Croatia’s compulsory health insurance system does
not depend solely on salary contributions and displays characteristics of both
Bismarck and Beveridge systems. Additionally, contributions at a uniform
rate of 0.5% of gross income are levied on salaries for occupational safety.
Those funds are hypothecated for treatment, rehabilitation and sick leave
compensations caused by injuries and diseases sustained in the workplace,
according to the Health Insurance Act. As part of the general decentralization
policy, a small but increasing share of public spending on health is being picked
up by local government. In 2002, county governments spent just 3% of their
revenues on health care. Reliable data on private spending are currently not
available, government estimates place private spending somewhere around 2%
of gross domestic product (GDP), or approximately one fifth of total health
expenditure.
Provision and funding of services are largely public, although private
providers and insurers also operate in the market. The health care system is
dominated by a single public health insurance fund: the Croatian Institute
for Health Insurance (HZZO). To ensure equality of access to all citizens,
HZZO-contracted health care providers operate within the framework of the
national health care network. The network determines allocation of public
financial resources between the 20 counties according to morbidity, mortality,
demographic characteristics, etc. The central government continues to play a
dual role as the purchaser and provider of health care through its influence on
the HZZO funding, on the one hand, and as the largest owner of hospitals and
public health institutions, on the other.
Since 1991, the health system has been subject to a range of organizational
reforms. Ownership of secondary and tertiary health care facilities (buildings)
was distributed among the State, counties and cities. Tertiary health care
facilities, comprising clinical hospitals, clinical hospital centres and national
institutes of health, remained state-owned. Secondary health care facilities
(general and special hospitals) and county institutes of public health became
county-owned. The majority of primary health care general practitioner (GP)
offices located in health centres were privatized, while the remaining were left
in county ownership.
Croatia spends a relatively high share of its GDP on health. There was a
period of rapid cost escalation in the late 1990s, which peaked in 2000. From
2000 to 2002, it appears that public spending was contained. According to the
Croatian Ministry of Health, in 2003 total spending on health was estimated at

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8.9% of GDP, in 2004 at 9.7% of GDP and in 2005 at 8.7% of GDP. The rise
of expenditure in 2004 is attributed to the settlement of HZZO and hospital
arrears from 2000, 2002 and 2003, which amounted to more than HRK 3 billion
(more than US$ 532 million).
Since independence, Croatia has embarked on a number of reform initiatives
in the field of health care. Recent reforms appear to have succeeded in containing
the increased expenditure and even bringing about a reversal in the level of public
spending on health. Nevertheless, despite the reductions, the health system is
still heavily burdened by arrears. According to the Croatian Ministry of Health,
in December 2004 clinical hospitals owed HRK 1.3 billion (US$ 216 million),
general hospitals owed HRK 890 million (US$ 148 million) and special
hospitals owed HRK 180 million (US$ 30 million) to various suppliers. By the
end of 2003, HZZO’s debts grew to HRK 3.686 billion (US$ 613 million), of
which HRK 980 million (US$ 163 million) was for pharmaceuticals. Solutions
advocated by policy-makers in Croatia heavily revolved around increasing
the inflow of private funds into the system. Reforms have included enlarging
the “participation scheme”, reducing the number of individuals exempt from
participation, the introduction of administrative fees, and the planned exclusion
of drugs expenditure from complementary insurance benefits. Developing
regulation and the implementation of more supply-side-oriented tools may
hold an underused window of opportunity that deserves more consideration.
The pressure on public resources to spend more on health will intensify in the
coming years, and will have to be met with prudent allocation of resources and
continuous efforts to improve productivity wherever possible.

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1 Introduction and historical
background
1.1 Introductory overview
1.1.1 Geography and sociodemography
Croatia (Hrvatska) is an Adriatic and a central European country. It
stretches in an arc from the Danube in the north-east to Istria in the west
and Prevlaka in the south-east. It covers an area of 56 542 km² with a
coastline length of 5835 km. Croatia is bordered by Bosnia and Herzegovina
(932 km), Hungary (329 km), Serbia and Montenegro (north, 241 km), Serbia
and Montenegro (south, 25 km) and Slovenia (670 km) (see Fig. 1.1). Zagreb is
the capital and the largest city in Croatia with approximately 800 000 inhabitants
in 2001 (Central Bureau of Statistics, 2004).
Croatia has an important geographical position between central Europe
and the Mediterranean. Main international land transport routes pass through
the country from western Europe to the Aegean Sea and the Turkish Straits.
The importance of Croatia’s geographical position is further enhanced by its
proximity to the Adriatic Sea, the northernmost gulf of the Mediterranean.
The country is divided into three major geographical parts: the Pannonian
region, the Coastal region and the Mountain region. In the north and north-
east, the Pannonian and para-Pannonian lowlands and hills are commonly used
for farming. The north of the country, where Zagreb can be found, is the most
industrially developed.
The hilly and mountainous area separates Pannonian Croatia from the coast.
The future of this region depends on the development of transit, the wood and
timber industry, the production of healthy food and tourism.

2
Health systems in transition Croatia
The narrow coastal belt of the Adriatic area is predominantly karstic, with
very dry summers. A few streams follow narrow gorges to break through to
the sea. Croatia is among the countries with the most islands in the world.
The Croatian Adriatic coast is made up of 1185 islands and islets with a total
coastline of 4058 km. The total length of the mainland coast is 1777 km. The
biggest island is Krk; other large islands include Cres, Brac, Hvar, Pag and
Korcula. The largest peninsulas are Istria and Peljesac and the largest bay is
Kvarner Bay.
The climate in Croatia is continental in the north, mountainous in the centre
and Mediterranean along the Adriatic coast (Government of the Republic of
Croatia, 2006).
In 2004, the total population of Croatia was estimated at 4.4 million (see
Table 1.1) and the density of the population was 78.5 inhabitants per km²
(Central Bureau of Statistics, 2005).
The proportion of young people in Croatia (0–14 years old) is slightly lower
than the European Union (EU) average (see Table 1.2). The percentage has
Fig. 1.1 Map of Croatia
Source: United Nations Cartographic Section, 2006.

3
CroatiaHealth systems in transition
declined from 19.89% in 1996 to 16.14% in 2004 (see Table 1.3). Much like
the rest of Europe, Croatia is facing the challenges brought about by a gradually
ageing population.
Table 1.1 Population and gender distribution, population estimates, 1995–2004
Year Total population Gender distribution
in 1000s Males in 1000s Females in 1000s
1995 4 776 2 313 2 463
1996 4 494 2 160 2 334
1997 4 572 2 197 2 375
1998 4 501 2 163 2 338
1999 4 553 2 188 2 365
2000 4 381 2 106 2 276
2001 4 437 2 136 2 302
2002 4 443 2 139 2 305
2003 4 427 2 129 2 298
2004 4 439 2 137 2 302
Source: Central Bureau of Statistics, 2005.
Table 1.2 Percentage of the population by age group in Croatia and the EU, 2003 or
latest available year (in parentheses)
Country 0–14 years, % of
total population
15–64 years, % of
total population
65 and over, % of
total population
Austria 16.43 68.09 15.48
Belgium (1997) 17.81 65.94 16.25
Croatia 16.42 67.19 16.39
Denmark (2001) 18.66 66.52 14.82
Finland 17.72 66.82 15.46
France (2002) 18.67 65.09 16.24
Germany 14.89 67.36 17.75
Greece 14.56 67.75 17.69
Ireland 20.95 67.92 11.13
Italy (2001) 14.22 67.1 18.68
Luxembourg 18.81 67.13 14.06
Netherlands 18.57 67.65 13.78
Portugal 15.74 67.44 16.82
Spain 14.52 68.59 16.89
Sweden (2002) 18.11 64.71 17.18
United Kingdom 18.34 65.69 15.97
EU 16.49 67.21 16.30
Source: WHO Regional Office for Europe, 2006.

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Health systems in transition Croatia
Although the proportion of the population aged 65 and over is approximately
equal to the EU average, this percentage has been increasing alarmingly over
the past few years, from 12.34% in 1995 to 16.64% in 2004. This represents
a 35% increase; just under double the rate of decline of young people over
the same period. Depopulation trends in Croatia started in 1991. In 2003, the
population increase was negative (–2.9), the lowest since the establishment of
independence (see Table 1.4).
Table 1.3 Population distribution, demographic dependency ratio, and population
growth rate (thousands), 1995–2004
Year Population distribution by age (%) Demographic
dependency
ratioa
0–14 years 15–64 years 65+ years
1995 19.29 68.37 12.34 0.463
1996 19.89 67.79 12.32 0.475
1997 19.89 67.79 12.32 0.475
1998 19.89 67.79 12.32 0.475
1999 19.77 67.87 12.36 0.473
2000 19.81 67.68 12.51 0.476
2001 17.01 67.36 15.63 0.485
2002 16.72 67.18 16.10 0.489
2003 16.42 67.19 16.39 0.488
2004 16.14 67.22 16.64 0.488
Source: Central Bureau of Statistics, 2005.
Note: a Demographic dependency ratio is the total number of persons under 15 years old plus
the elderly population aged 65 years and over, over the population of age 15–64 years.
Table 1.4 Live births, deaths and natural increase (rate per 1000 population),
1995–2004
Year Live births Deaths Natural increase
1995 11.2 11.3 -0.1
1996 12.0 11.3 0.7
1997 12.1 11.4 0.8
1998 10.5 11.6 -1.2
1999 9.9 11.4 -1.5
2000 10.0 11.5 -1.5
2001 9.2 11.2 -1.9
2002 9.0 11.4 -2.4
2003 8.9 11.8 -2.9
2004 9.1 11.2 -2.1
Source: Central Bureau of Statistics, 2005.

5
CroatiaHealth systems in transition
The total number of marriages has been slowly decreasing from 1995 to
2003 while, in the same period, the total number of divorces increased (see
Table 1.5).
Table 1.5 Marriages and divorces, 1995–2003
Year Total marriages Crude marriage
rateaTotal divorces Crude divorce
rateb
1995 24 385 5.1 4 236 173.7
1996 24 596 5.5 3 612 146.9
1997 24 517 5.4 3 899 159.0
1998 24 243 5.4 3 962 163.4
1999 23 778 5.2 3 721 156.5
2000 22 017 5.0 4 419 200.7
2001 22 076 5.0 4 670 211.5
2002 22 806 5.1 4 496 197.1
2003 22 076 5.0 4 934 220.9
Source: Central Bureau of Statistics, 2005.
Notes: a Crude marriage rate: number of marriages per 1000 inhabitants; b Crude divorce rate:
number of divorces per 1000 marriages.
Over a period of 10 years, the total number of people per household has
decreased from 3.10 in 1991 to 2.99 in 2001 (see Table 1.6).
The official language is Croatian. The main national minorities are Serbs
(4.5%) and others 5.9% (including Bosniak, Hungarian, Slovene, Czech and
Roma). The most prevalent religion is Roman Catholicism (87.8%) (CIA,
2005).
Table 1.6 Population and households by census, selected years
Census
year Number of inhabitants Number of households Average number of
people per household
1953 3 936 022 1 031 910 3.81
1961 4 159 696 1 167 586 3.56
1971 4 426 221 1 289 325 3.43
1981 4 601 469 1 423 862 3.23
1991 4 784 265 1 544 250 3.10
2001 4 437 460 1 477 377 2.99
Source: Central Bureau of Statistics, 2003.

6
Health systems in transition Croatia
1.1.2 Political and economic background
Croatia’s political system is a Parliamentary Democracy established by the
Constitution of 22 December 1990. The first democratic multiparty elections
took place in April 1990 when the Croatian Democratic Union (HDZ) defeated
the Communist Party and was elected the party of the Government. Franjo
Tudjman was elected as President. In the May 1991 referendum the population
voted in favour of independence from the Federal Republic of Yugoslavia.
Croatia officially declared independence in October 1991. This prompted a
declaration of independence from Croatia by the Serbian enclave of Krajina,
where fighting broke out followed by an intervention of the Yugoslav People’s
Army on behalf of the Serbian population. War continued with the Krajina
Serbs and with the Federal Republic of Yugoslavia from 1991 to 1995, and in
Bosnia and Herzegovina until the signing of the Dayton Peace Agreement in
December 1995. This agreement recognized Croatia’s traditional borders and
called for the return of occupied eastern Slavonia in 1997.
The Head of State is the President, who is elected by direct universal suffrage
for a five-year term and may be re-elected for a further single term. In addition
to being the leader of the country, the President appoints the Prime Minster
and Cabinet members, with the consent of the Parliament. Following the death
of President Tudjman in December 1999, the powers of the presidency were
curtailed and greater responsibility was vested in Parliament.
The Parliament (Sabor), contains the House of Representatives. The House
of Representatives has 151 seats and members are directly elected by popular
vote to serve four-year terms.
The Government of the Republic of Croatia exercises executive powers
in conformity with the Constitution and national legislation. Its internal
organization, operational procedures and decision-making processes are
defined by the Law on Government of the Republic of Croatia and the Rules
of Procedure of the Government. The Government passes decrees, introduces
legislation, proposes the state budget and enforces laws and other regulations
enacted by the Croatian Parliament. The Government consists of the Prime
Minister, two Vice Prime Ministers and 13 ministries.
In January 2005, Stjepan Mesic won a second five-year term as President.
Prime Minister Ivo Sanader, leader of the HDZ, formed a government following
the parliamentary elections in November 2003.
The Constitutional Court ensures that laws passed by the Parliament conform
to the Constitution. Judges are appointed for eight-year terms by the Judicial
Council of the Republic of Croatia. This Council is elected by the House of
Representatives.

7
CroatiaHealth systems in transition
Regional and local government is organized on two levels: 20 counties plus
the city of Zagreb, and 426 municipalities. Counties are regional territorial units,
each governed by a county assembly, a county head and county administration.
Municipalities are smaller, comprising a municipal council and a municipal
mayor. County and municipality representatives are elected by regional elections
for four-year terms.
Croatia’s foreign policy priorities focus on developing closer relations with
international organizations; a goal towards which rapid progress has been made.
Croatia is a member of the Council of Europe and the United Nations and its
specialized agencies. It joined the World Bank in 1993 and the Partnership for
Peace (PfP) North Atlantic Treaty Organisation (NATO) Arrangement and the
World Trade Organization (WTO) in 2000. As of June 2004, Croatia has been
a candidate country for accession to the EU.
The five years of war from 1991 to 1996, following Croatia’s declaration of
independence, caused important demographic losses and left deep psychological
scars. War damages, including considerable damage to the country’s housing
and public services infrastructure, were estimated at €32.6 billion, two thirds
of which was direct material damage (Stevenson and Stubbs, 2003). Up to
20 000 people have been reported killed or missing, and more than 30 000
people have been disabled as a result of the war (Government of the Republic of
Croatia, 1999). Approximately 47.5% (27 000 km²) of the Croatian continental
territory containing approximately 1.5 million inhabitants was affected by the
war. At the end of 1991, up to 11.5% of the population lived in partly or fully
occupied areas. Displaced persons and refugees from neighbouring Bosnia and
Herzegovina flooded the country. During the period between 1992 and 1998 the
number of refugees and displaced persons was between 430 000 and 700 000
(Babic-Banaszak et al., 2002).
The national economy suffered accordingly. Prior to the dissolution of Federal
Yugoslavia, Croatia, after Slovenia, was the most prosperous and industrialized
republic in the federation. The per-capita output was approximately one-third
above the Yugoslav average (CIA, 2005). During the war the economy went
into recession. By 1993, gross national product (GNP) was at 68% of its pre-
war level (WHO Regional Office for Europe, 2000). The country also suffered
heavy inflation. Nonetheless, there were concentrated efforts to implement
structural and economic reforms. The monetary reform in 1993, which has
been described as “one of the most successful exchange rate-based stabilization
programmes in the region”, led to moderate inflation rates and a stabilization
of the national economy (World Bank, 2000). As a result, Croatia was awarded
investment credit ratings (World Bank, 2001).

8
Health systems in transition Croatia
Progress has also been made in implementing structural reforms – nearly
two thirds of the economy has been privatized, more than three quarters of bank
assets have been channelled into private institutions and the banking system
has regained strength. Private consumption and a recovery in exports pulled the
economy out of recession in 2000. Increased tourism revenues have also helped
to reduce the current account deficit to its lowest level over the years. Although
reconstruction of infrastructure, homes, schools and factories is progressing
and displaced persons are returning, the economy suffered a negative current
account balance of US$ 617 million and a total outstanding and disbursed debt
of approximately US$ 13.4 million, as estimated by the World Bank in 2003
(World Bank, 2003).
Gross domestic product (GDP) has been continually rising since 1996 (see
Table 1.7). In 2004, the service sector contributed to an impressive 61.6% of
GDP, followed by the industry sector (30.1%) and the agriculture sector (8.2%).
The service sector has been the fastest growing sector of the Croatian economy
with a 4.8% annual growth rate in 2001 followed by the industry sector (4.3%)
and the agriculture sector (0.7%) (World Bank, 2005).
Table 1.7 Macroeconomic context, 1996–2004
Indicator year 1996 1997 1998 1999 2000 2001 2002 2003 2004
Unemployment rate 10.0 9.9 11.4 13.6 16.1 14.8 14.3 14.3 13.8
Annual rate of
inflation (%) 3.5 3.6 5.7 4.0 4.6 3.8 1.7 1.8 2.1
GDP per capita (€) 3 531 3 891 4 284 4 102 4 560 4 998 5 451 5 747 6 224
Source: Croatian National Bank, 2005.
Structural unemployment remains a key challenge for Croatia’s economy.
In 2004, of the 1.72 million inhabitants in the active population, 18% were
unemployed (Central Bureau of Statistics, 2005). Most employment is
concentrated in the service sector followed by the industry and agriculture
sectors (see Table 1.8).
Total exports in 2004 amounted to approximately US$ 8 billion with a
major share (approximately US$ 3.8 billion) accounted for by manufactures.
Total imports in the same year amounted to approximately US$ 16.5 billion,
of which capital goods accounted for approximately US$ 5.7 billion (see Table
1.9) (World Bank, 2005). Major export partners include: Germany (16.1% of
total exports), Italy (14.5%), Slovenia (6.9%), Austria (6.3%), France (5.6%)
and Russia (3.3%) (CIA, 2005).
Croatia has a universal primary education system with all children
participating. Primary schools were attended by 393 744 pupils in 2004/2005.

9
CroatiaHealth systems in transition
Regular and special secondary schools had 192 076 pupils in the same year.
University courses were attended by 101 688 students (Central Bureau of
Statistics, 2005). In 2003, total adult literacy rate was 98.1%; 99.3% among
men and 97.1% among women (WHO Regional Office for Europe, 2006).
1.1.3 Health status
Responsibility for the processing of health care and public health information
lies with the Central Bureau of Statistics and the Croatian Institute for Public
Health. For all deaths occurring in Croatia, causes are coded centrally by the
Croatian National Institute of Public Health (HZJZ), thereby ensuring a high
Table 1.8 Employment by sector, 2004
Sector % of total employment
Agriculture 6.3
Agriculture, hunting and forestry 6.0
Industry 31.2
Manufacturing 20.5
Services 62.3
Wholesale and retail trade; repair of motor vehicles,
motorcycles and personal and household goods 16.9
Public administration and defence, compulsory social security 7.6
Transport, storage and communication 6.9
Other 0.2
Source: Central Bureau of Statistics, 2005.
Table 1.9 Trade and balance of payments (US$ millions)
2003 2004
Total exports (fob) 6 007 8 208
Raw materials, excluding fuels 329 449
Mineral fuels and lubricants 560 909
Manufactures 2 953 3 824
Total imports (cif) 13 469 16 555
Food 930 1 190
Fuel and energy 1 500 1 987
Capital goods 4 500 5 739
Balance of payments
Exports of goods and services 14 324 17 828
Imports of goods and services 16 212 20 180
Resource balance -1 888 -2 353
Source: World Bank, 2005.
Notes: fob: free on board; cif: cost, insurance and freight.

10
Health systems in transition Croatia
quality of classification. County-specific mortality data are published annually
in the Croatian Health Services Yearbook, edited by the HZJZ.
Overall, chronic diseases are more prevalent than communicable diseases.
The crude death rate per 1000 people was 11.2 in 2004. In 2004, the main causes
of death were due to circulatory system diseases (50%), malignant neoplasms
(25%), external injury and poisoning (6%), diseases of the respiratory system
(6%) and diseases of the digestive system (5%) (Central Bureau of Statistics,
2005).
In 2004, Croatia had a life expectancy at birth of 75.66 for both sexes (71.13
for male and 79.08 for female), while life expectancy at 65 was 13.98 for males
and 17.65 for females (See Fig. 1.2 and Fig. 1.3).
Infant mortality has gradually declined from 8.1 infant deaths per 1000 live
births in 1996 to 6.08 per 1000 in 2004 but is still higher than the EU average
of 4.75 per 1000. Neonatal deaths per 1000 live births have decreased from
5.78 per 1000 live births in 1999 to 4.56 per 1000 in 2004, compared to the
EU average of 3.24 per 1000 in 2004 (WHO Regional Office for Europe, 2006;
Central Bureau of Statistics, 2005).
1.2 Historical background
The period from 1918 to 1945
Health Insurance was introduced through three separate private organizations
in 1922, as one of the more advanced schemes in Europe. The Brotherhood
Treasury covered mine workers, the Central Office for Workers Insurance
covered other employees and workers, and Merkur mainly covered government
officials. These health insurance organizations also had their own health care
providers.
In the 1920s, public health centres for health promotion, hygiene and
epidemiology were established in rural areas. The remainder of the health system
was mostly privately run. In general, health services were oriented towards
individuals who could pay for health care, while there was a public system for
the control of communicable diseases and promotion of public hygiene.
Professor Andrija Stampar of the Zagreb School of Public Health, one of
the founders of the World Health Organization (WHO) and of the Association
of Public Health in Europe, helped in introducing a range of public health
services in the 1920s and 1930s. He also pioneered primary health care centres
in Croatia.

11
CroatiaHealth systems in transition
60 65 70 75 80 85
Male
Female
The period from 1945 to 1990
Croatia ran its own health services with its own Ministry of Health as a
separate State federated within the Socialist Federal Republic of Yugoslavia. In
1945, compulsory state health insurance was introduced covering most of the
Fig. 1.2 Life expectancy at birth, 2004 (or latest available year)
Slovenia
Albania (2003)
Czech Republic
Croatia
The former Yugoslav Republic of Macedonia (2003)
Poland
Serbia and Montenegro (2002)
Slovakia (2002)
Bosnia and Herzegovina (1991)
Bulgaria
Hungary (2003)
Romania
Estonia
Lithuania
Latvia
EU average
Years
Source: WHO Regional Office for Europe, 2006.

12
Health systems in transition Croatia
5 10 15 20 25
Male
Female
Source: WHO Regional Office for Europe, 2006.
Years
Fig. 1.3 Life expectancy at age 65, 2004 (or latest available year)
Slovenia
Albania (2003)
Czech Republic
Croatia
The former Yugoslav Republic of Macedonia (2003)
Poland
Serbia and Montenegro (2002)
Slovakia (2002)
Bosnia and Herzegovina (1991)
Bulgaria
Hungary (2003)
Romania
Estonia
Lithuania
Latvia
EU average

13
CroatiaHealth systems in transition
population. This was financed from income-related contributions and from the
state budget. Insurance was first organized at local level through local health
and social insurance organizations. In the second phase, the federal Government
administered pensions and health insurance funds that were brought together
under the Institute for Social Insurance, which subsequently split into the Health
Insurance Fund and the Pension and Disability Fund.
The third phase introduced community management. The Constitution of
1974 set up local associations, which were to plan, collect and distribute financial
resources, and organize health services. Legislation was enacted to consolidate
large units, known as medical centres, which administered primary care, first-
level secondary care hospitals and public hygiene services in their area. The
result was that resources were used inefficiently, hospitals seized most of the
funds, and community management was not compatible with large medical
organizations. In practice, decisions were made by political or governmental
bodies. Also, despite a long tradition of private health care, private medical (but
not dental) practices were reduced to a very small number. The three insurance
schemes continued as before for employees, farmers and artisans, and the self-
employed alongside the Health Insurance Fund.
By the end of the 1980s, the Croatian health care system became a unique
blend of health insurance funds, neglected primary health care networks, quasi-
autonomous health organizations and “self-managing” authorities. The result
was a liberal, disorganized and expensive system which, according to Letica
(1989), suffered from a prolonged professional and financial crisis.
Since 1990
In the decade following independence, Croatian health care went through a series
of health reforms that have helped to transform the once fragmented and highly
decentralized health system, inherited from former Yugoslavia and battered
by five years of war, into a health care system that maintains the principles of
universality and solidarity.
The Health Care Law of 1993 consolidated finances under a single public
entity, the Croatian Health Insurance Institute (Hrvatski zavod za zdravstveno
osiguranje, HZZO). The HZZO established the foundation for a revenue base
that has provided universal coverage for the population and has since been the
main source of health financing in Croatia. Croatia’s social health insurance
programme is based on the principles of solidarity and reciprocity in which
citizens are expected to contribute according to their ability to pay, and receive
basic health services according to need. The 1993 Law allowed opting-out of
the public insurance system and acquiring substitutive insurance with private
insurers. This was abolished in 2002.

14
Health systems in transition Croatia
The 1993 Law introduced the principles of patient choice and patient rights.
The system recognized the participation of private insurance and the role of
private provision of health care services. Although the majority of health care
providers remained under public ownership, private providers have grown
in number, notably in primary care, dental services, specialized clinics and
dispensaries. A small but growing private insurance market has also developed,
which offers additional (supplementary) insurance coverage for services not
covered under the statutory insurance plan.
The central Government continues to play a dual role as the purchaser
and provider of health care through its influence on the HZZO funding on
the one hand, and its role as the largest owner of hospitals and public health
institutions, on the other. The majority of primary care units, however, have
been privatized.
In July 2001, the Ministry of Health issued a comprehensive policy statement
in a paper entitled “The Strategy and Plan for the Reform of the Health Care
System and Health Insurance of the Republic of Croatia”. The Ministry’s paper
acknowledged that despite significant achievements in improving financing
and delivery of health care in the 1990s, the health system continued to face a
variety of financial and structural problems.
Since 2000, the Government’s round of health sector reform measures were
aimed at achieving a broad set of objectives:
containing the rate of increase in expenditure from public sources and
reducing the payroll contribution rate by limiting benefits and increasing
revenue through increased cost sharing;
improving efficiency and productivity of services through the reorganization
and rationalization of the delivery system, especially at tertiary and secondary
levels;
enhancing the contractual relationship between the HZZO and health care
providers to achieve better alignment of incentives for efficiency and quality
with payments;
devolving greater responsibilities to the local authorities (counties and city
of Zagreb) to manage the delivery system at primary and secondary levels,
and to improve the continuity of services at these levels;
expanding the scope of public health programmes focused on prevention
and health promotion.
The Croatian health system has fared relatively well among the countries in
the region: the system has a well-trained health workforce, a well-established
system of public health programmes and health delivery system, and good health
outcomes in relation to countries at comparable income levels. However, these
•
•
•
•
•

15
CroatiaHealth systems in transition
results have been achieved at a high cost and the Health Insurance Fund has
faced growing deficits in recent years. The generous benefits and exemptions
established during the early growth years have been politically difficult to roll
back, while the ageing population and changing epidemiological profiles have
contributed to a rapid increase in public spending on health care. The efforts to
contain costs in the 1990s and early 2000s were not effective, as the HZZO’s
expenditure continues to outstrip revenues and arrears have built up. The attempts
to cap costs administratively have led to growing waiting lists and dissatisfaction
among the patients and providers. This has prompted the Government to initiate
a new round of reforms aimed at containing costs, reducing the tax burden on
labour, and increasing revenue through cost sharing.
Croatia’s challenge is to channel its already substantial public spending
towards greater efficiency without jeopardizing its other competing objectives
of universality, fairness and equity, quality, patient choice and satisfaction.

17
CroatiaHealth systems in transition
2.1 Organizational structure of the health care
system
Croatia’s health care system is based on the principles of social health
insurance. Provision and funding of services are largely public, although
private providers and insurers also operate in the market. The health
care system is dominated by a single public health insurance fund: the Croatian
Institute for Health Insurance, the HZZO.
Since 1991, the health care system has been subject to a range of organizational
reforms. Ownership of secondary and tertiary health care facilities (buildings)
was distributed among the State, counties and cities. Tertiary health care facilities
remained state-owned, comprising clinical hospitals, clinical hospital centres
and national institutes of health. Secondary health care facilities (general and
special hospitals) and county institutes of public health became county-owned.
The majority of primary health care general practitioner (GP) offices located
in health centres were privatized, and the remaining ones were left under
county ownership. Since 1991, Croatia has also witnessed a rapid growth of
private secondary health care facilities: mostly special hospitals and polyclinics
(outpatient facilities). Fig. 2.1 depicts in a simplified way the organization of
the social protection system.
Ministry of Health
At central level, the Ministry of Health is responsible for: (i) health policy,
planning and evaluation, including the drafting of legislation, regulation of
standards for health services and training; (ii) public health programmes,
2 Organizational structure and
management

18
Health systems in transition Croatia
including monitoring and surveillance of health status, health promotion, food
and drug safety, and environmental sanitation; and (iii) regulation of capital
investments in health care providers in public ownership.
In particular, the Ministry of Health draws up legislation for consideration
by the Parliament, produces the annual national health plan for the country,
Fig. 2.1 Organizational chart of the social protection system
State Government
Ministry of Health Ministry of Finance
Clinical hospitals
and centres
Croatian Health Insurance
Institute (HZZO)
County government
Primary
care
doctors
Dental
clinics Pharmacies
Special
hospitals
Polyclinics and
community
health centres
County public
health
institutes
General
county
hospitals
State institutes
of health
Institute of Public Health,
Institute of Transfusion Medicine,
Occupational Health Institute,
Mental Health Institute,
National Institute for Radiation Protection,
Drug and Medical Product Agency,
Institute of Toxicology
a
a

19
CroatiaHealth systems in transition
monitors health status and health care needs, sets and regulates standards
in health facilities and supervises professional activities such as training.
The Ministry of Health manages public health activities including sanitary
inspections, supervises food and drug quality and engages in the health education
of the population. The Ministry also nominates the chairs of the governing
councils and appoints the majority of the board members in state-owned health
care facilities. A National Health Council, which was set up under the Health
Act and consists of nine members nominated for their expertise, advises the
Minister of Health on health policy and planning issues.
Ministry of Finance and the State Treasury
The Ministry of Finance is responsible for the planning and managing of the
government budget, which includes the approval of the central budget transfers
to the HZZO as well as the Ministry of Health. Therefore, the Ministry of
Finance plays a key role in determining the overall level of public spending
on health care.
Since 2001, the State Treasury has been responsible for all state finances,
including collecting and allocating social health insurance contributions. It was
thought that the collection of all state revenues through a single account would
alleviate the challenges with analyses and comparisons and would stimulate
greater fiscal discipline in the economy (World Bank, 2000).
Croatian Health Insurance Institute (HZZO)
Established in 1993, the HZZO is a public body responsible for managing
the Health Insurance Fund and contracting health care services. As the main
purchaser of health services, the HZZO also plays a key role in the definition
of basic health services covered under statutory insurance, the establishment
of performance standards and price setting for services covered by the HZZO.
The HZZO is also responsible for the distribution of sick leave compensation,
maternity benefits and other allowances as regulated by the Croatian Health
Insurance Act.
The main office of the HZZO is located in the capital city (Zagreb) and 21
branch offices are located in county centres. The Zagreb office is responsible
for devising the means of implementing compulsory health insurance, and
branch offices are in charge of implementation. The HZZO is overseen by a
governing council, which consists of representatives of the insured population,
the Ministry of Health, the Ministry of Finance, health institutions and private
practices (independent GPs).

20
Health systems in transition Croatia
Counties and the city of Zagreb
Local governments own and operate most of the public primary and secondary
health care facilities, including general hospitals, polyclinics, public health
institutes and community health organizations (home care and emergency
care units). While these facilities receive operating expenditure through their
contracts with the HZZO, the local authority is responsible for the maintenance
of the infrastructure, and increasingly for capital investments. Revenue is
derived from decentralized state funds, local taxes and rental income. Under
the Government’s decentralization policy, local governments are expected to
play an increasing role in the coordination and management of health services
at county and municipal levels.
Professional chambers
Croatia has statutory professional chambers for physicians, dentists, pharmacists,
biochemists and nurses that were established by the relevant faculties and
professional associations. All university-educated health professionals and
nurses are members of a chamber. The chambers in turn are responsible
for professional registration and maintenance of professional standards.
The chambers also express professional opinions on a variety of issues and
advise on licensing of private practice and on opening and closing of health
institutions.
2.2 Planning, regulation and management
2.2.1 Planning
The Ministry of Health produces an annual national health plan that contains
clearly defined objectives following suggestions from the Croatian National
Institute of Public Health (HZJZ). This plan must then be approved by
Government. The national health plan is implemented at all levels and supervised
by the Ministry of Health. Also, based on the suggestions of the HZJZ, the
Minister of Health enacts the Health Care Measure Plan and Programme, upon
receiving the opinions of the competent chambers.
The HZJZ plays an important role in public health planning, monitoring and
evaluation. The institute prepares epidemiological analyses and supports health
promotion and illness prevention programmes. Control of quarantine; and the

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prevention and control of communicable diseases, noncommunicable diseases,
the delivery of immunization programmes, environmental protection measures
and the monitoring of drinking water and other health risks are undertaken
through the compulsory notification system and through inspection. At county
(and the city of Zagreb) level, county public health institutes collect statistics
and participate in the formulation and implementation of health programmes
for their areas.
The HZZO implements the plans for direct health services through its
contracts with health care providers. Under the national health plan, the HZZO
passes regulations on health insurance entitlements, which aim to balance the
supply of resources with the demand for services.
2.2.2 Regulation
The regulation of standards in health care institutions is the responsibility of
the Ministry of Health. Standards are set out in health care-related legislation.
Teams of health inspectors visit health institutions if there are organizational
or professional failures. Licensing of professionals is the responsibility of the
professional chambers.
2.2.3 Management
Currently, managerial responsibilities in health care are divided according to
ownership – between the state authorities and counties (municipalities have
a minor role in managing health services). The central Government sets the
framework within which a county draws up its health policy. Some planning,
administrative and supervisory roles are devolved to county authorities. In
practice, management has been delegated to health care-providing institutions
such as health centres and hospitals that are run by governing boards.
All hospitals, health centres and other health care facilities are managed
by a director and a deputy director, one of whom is required to be a medical
doctor with at least five years of clinical experience. Each health care-providing
institution has a governing board composed of representatives of owners and
employees. Professional councils comprising department heads provide help on
professional issues and technical solutions related to the providers’ operations.
Professional councils participate in the planning of health care provision and
supervise the implementation of clinical standards. Furthermore, all health
care facilities have committees for ethical issues as advisory bodies to the
principal.

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Health systems in transition Croatia
2.3 Decentralization of the health care system
During the 1980s, the Croatian health care system was notable for its
decentralization in terms of its range and the way in which it was introduced. It
was characterized by a high level of autonomy of local authorities and by the fact
that both health workers and users participated in decision-making. The model
was designed to ensure workers, who were considered the central power of the
socialist society, actively participated in public services. In practice, political
bodies made the majority of management decisions, and there was little, if any,
supervision or inspection. Health care services suffered from poor organization,
lack of management and considerable inefficiency.
Political reforms related to the onset of transition in Croatia in 1990 and
the struggle for independence (gained in 1991) led to radical reforms of the
entire system of public services, including health care. One of the measures
introduced was the centralization of funding in health care, justified by a lack of
cooperation and control and by severe financial difficulties. The newly founded
State was eager to control not only public services in general, but also all units
of individual systems such as health care. The 1990 centralization of health
finances marked the outline of the 1993 health reform that, although introducing
several elements of decentralization (e.g. health institutions owned by local
authorities, privatization in primary care), kept very tight central control over
health care through funding and regulation (Dzakula et al. 2005).
In 2002, a management capacity-building programme entitled “Healthy
Counties” was developed by the Andrija Stampar School of Public Health and
the Ministry of Health. The programme draws on a number of training resources
and other concepts from the United States’ Centers for Disease Control and
Prevention’s (CDC) Sustainable Management Development Programme and
its Management for International Public Health Course. The main aim of the
programme is to empower local professionals and authorities for managing
and planning in public health, health care and health policy. Up to the end
of 2004, 15 counties (out of 20) and the city of Zagreb were involved in the
programme.

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CroatiaHealth systems in transition
3.1 Main system of financing and coverage
Health care in Croatia has a mixed system of financing. The Croatian
public health care system is financed by funds from social health
insurance contributions, co-payments, voluntary complementary health
insurance, privately provided supplementary health insurance, the state budget
and local self-administration county units’ budgets. In terms of medical services
provided, the majority of the Croatian health system is financed according to
the social health insurance model with one insurance institution or sickness
fund, the HZZO.
Health insurance terminology in Croatia varies somewhat from that used
in the European Union (EU). This report uses EU terminology for ease of
comparison between countries. A short legend of terms can be found in Table
3.1.
Funds for social health insurance are collected mainly from payroll taxes
paid by employees, the self-employed and farmers’ contributions. Social health
insurance for certain vulnerable categories of the population is partly cross-
subsidized from payroll contributions and additionally funded by transfers
from the central government budget and from county budgets. These categories
include the unemployed, disabled, elderly, people under 18, students, war
veterans and the military.
Patients are required to pay for access to certain publicly provided health
services through co-payments or to buy complementary health insurance.
Certain groups are exempt from paying co-payments. These include the
unemployed, disabled, people under 18, students, the military, war invalids,
and multiple voluntary blood donors.
3 Health care financing and
expenditure

24
Health systems in transition Croatia
Table 3.1 Definitions of health insurance terminology in the EU and Croatia
European Union context Croatian context
Social health insurance – mandatory Basic health insurance – mandatory
Main insurance scheme
Coverage is provided by the State or national
health care system.
Main insurance scheme
Opting out is not allowed.
Complementary insurance
Coverage for services only partially covered
by social health insurance or the State (e.g.
co-payments imposed by the statutory health
insurance) – voluntary.
“Supplemental insurance”
Insurance coverage for co-payments required
by the Basic Health Insurance – voluntary.
Supplementary insurance
Coverage for services not covered by
statutory health insurance, e.g. to provide
faster access to selected services, offering
greater consumer choice, and for nonmedical
amenities – voluntary.
Private insurance
This is covered by “private insurance” for all
services not covered under the Basic Health
Insurance – voluntary. Since 2004, it can also
be used to cover co-payments charged by
public providers.
Supplementary insurance is optional. It is provided by private insurers and
covers the costs of hotel amenities or a higher standard of care in public hospitals
(e.g. choice of doctor, single rooms with television, air conditioning, etc.). It
can also be used for preventive check-ups and treatment in privately owned
practices contracted by the respective insurance company. Additionally, since
2004 it can be used to cover co-payments charged by public providers.
Privately owned facilities can enter into contracts with the HZZO and become
a part of the publicly funded system. Alternatively, they can choose to operate
on their own and charge private fees or enter into contracts with private insurers
and charge for services provided under supplementary insurance. Since 2002,
the Croatian system does not allow for opting out of social health insurance.
Social health insurance contributions are collected through the Government
and accumulated in the State Treasury. Budgetary funds for social health
insurance are determined annually and allocated to the HZZO. The HZZO
collects premiums for complementary insurance on its own. In 2003, state
budget funds for social health insurance accounted for 96.5% of total HZZO
revenue (including funds for the vulnerable categories paid from the state
budget), while funds collected from complementary health insurance accounted
for 3.5% (HZZO, 2004). Table 3.2 provides the sources of revenue reported by
health care providers.
The State also funds extra services such as antenatal and maternity care,
school health services and care for the elderly and subsidizes costs of health care
in remote regions. The State pays for public health and environmental protection,
and health education, and provides income substitution during maternity leave.
Capital investments are also funded from the state budget. On an annual basis,

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CroatiaHealth systems in transition
each county receives “decentralized funds” from the state Government, which
are to be used (after approval by the Ministry of Health) for investments in
buildings, technical equipment, etc. County budgetary contributions also fund
some public health and environmental protection activities and can additionally
be used for further capital investments in county-owned hospitals. The HZZO,
aside from paying for medical services, also participates (to a small extent) in
funding procurement of medical equipment for publicly owned providers.
Table 3.2 Sources of revenue reported by health care providers in 2001
Primary care Hospitals
Specialist
clinics and
polyclinics
Pharmacies
HZZO (%) 73.5 90.8 41.3 60.9
Other insurance
companies (%) 13.0 3.9 55.0 29.5
Co-payments (%) 0.7 0.7 0.2 0.7
Other revenue (%) 12.8 4.6 3.6 8.8
Source: World Bank, 2004.
Financing principles: pre-2002
The major challenges that the Croatian health system had to overcome in the
1990s were high expenditure and a continual fiscal crisis. As the statutory
public entity responsible for managing the Health Insurance Fund, the HZZO
accounted for over 90% of public spending on health and an estimated 80% of
the total health expenditure in Croatia. Total HZZO expenditure (excluding cash
transfers for sick leave) has grown faster than GDP, rising from 6.7% of GDP
in 1994, to a high of 8.0% in 2000. In 2001 and 2002, the increase in HZZO
expenditure has been contained below the GDP growth rate (see Table 3.3).
A rapid real increase in health expenditure was recorded by the HZZO
between 1998 and 2002, averaging approximately 8% per annum in real terms.
This rate of increase has outstripped the revenue of HZZO, which has not
increased significantly over the same period (see Table 3.4). As Table 3.5 shows,
between 1998 and 2000, spending increases occurred across most categories of
health spending. A sharp decline in expenditure on prescription drugs in 2002
could be attributed to the higher cost sharing introduced that year. However,
without the data from household expenditure and utilization surveys, it is
difficult to determine the extent to which cost reductions were attained through
productivity gains, or through other means, e.g. rationing of care (long waiting
lists for non-emergency services) and cost shifting to patients.

26
Health systems in transition Croatia
Table 3.3 The structure of HZZO expenditure as a percentage of GDP, 1994–2002
1994 1995 1996 1997 1998 1999 2000 2001 2002
Health care 6.0 6.9 6.6 6.2 7.1 7.7 8.3 7.5 6.2
Compensation and
allowances 0.8 1.1 1.5 1.6 1.5 1.5 1.8 1.3 1.1
Operating costs,
investments, loan
repayments, other
expenses 0.8 1.1 1.5 0.4 0.3 0.3 0.4 0.3 0.5
Total HZZO expenditure 7.5 9.2 9.6 8.1 8.4 9.0 9.8 8.6 7.8
HZZO expenditure
excluding compensations
and allowances 6.7 8.1 8.1 6.6 6.9 6.6 8.0 7.3 6.6
Source: World Bank, 2004.
Table 3.4 HZZO revenue and expenditure, 1998–2002 in US$ millionsa
Year 1998 1999 2000 2001 2002
Total revenue 1 720 1 889 1 952 2 068 2 116
Contributions 1 459 1 485 1 513 1 561 1 698
– employer 662 708 662 639 –
– employee 662 708 763 825 –
– other 136 68 87 95 –
Workers’ compensation – – – – 23
Other revenue 27 43 41 161 27
Transfers from the State Treasury 234 361 398 346 202
“Supplemental insurance” – – – – 43
Operation budget for HZZO – – – – 39
Receipts from borrowings – – – – 122
Total expenditure 1 724 1 908 2 194 2 076 2 068
Health care 1 352 1 530 1 731 1 689 1 635
Primary care 271 293 339 351 345
Polyclinics, specialist services 273 228 334 313 291
Prescription drugs 210 253 298 318 243
Hospitalization 486 642 633 612 671
Orthopaedic devices 36 39 53 50 56
Other health care-related expenditure 65 63 59 29 9
Compensation 308 311 400 318 302
HZZO operating costs 44 50 46 33 39
Other (investments, loan repayments,
special expenses) 23 18 50 48 92
Stock of short-term liabilitiesb523 542 405 410 455
Surplus/deficitc– 39 137 25 43
Source: HZZO, 2004.
Notes: a US$ millions calculated on the basis of the 2003 annual average of the US$/HRK exchange rate, as reported
by the Croatian National Bank; b Stocks of short-term liabilities are accounts payable for purchases made in the
current fiscal year but paid in the following fiscal year; c In this estimation, it was assumed that the stock of short-term
liabilities represented the full stock of accounts payable in the following fiscal year, and that the payments were made
in the following year. Receipts from borrowings are included in the 2002 calculation. On the revenue side, accounts
receivable were not included in this estimation.

27
CroatiaHealth systems in transition
Table 3.5 Annual real increase in HZZO expenditure over preceding year, 1998–2002
Expenditure
categories (%) 1998 1999 2000 2001 2002
Average annual
increase,
1998–2002
Primary care 3.8 4.0 8.5 2.5 -4.2 2.9
Specialist services 30.5 15.6 10.7 5.6 -8.1 10.9
Prescription drugs 25.5 -19.7 37.5 -7.3 -22.9 2.6
Orthopaedic devices 36.7 3.6 27.1 -5.3 7.3 13.9
Hospitalization 16.4 26.9 -7.3 -4.3 7.3 7.8
Source: HZZO, 2004.
1 These are 2003 HRK values.
Throughout the 1990s, the deficits incurred by the HZZO necessitated
periodic transfers of funds from the central budget to maintain the provision
of health services (see Table 3.4). In 2002, the Government registered short-
term liabilities amounting to HRK 3 billion1 (US$ 448 million) and borrowed
HRK 820 million (US$ 122 million) to pay off the old arrears accumulated
by the government-owned health care providers. While these arrears have
decreased from the high level of HRK 4 billion (US$ 597 million) in 1999,
the continuing operating deficit of the HZZO and the health care providers has
been a continual source of concern.
Recognizing the need to improve fiscal discipline in the health sector and to
reduce the annual deficits, the Government introduced measures to: (i) broaden
the sources of revenue; (ii) improve fiscal discipline and fund management;
and (iii) contain cost on the supply side through rationalizing the health
delivery structure and reforming provider payment methods. In particular, the
Government instituted an overall global budget cap for hospital care. However,
some observers considered this applied pressure as inappropriate, since it led
to longer waiting times and encouraged queues for certain high-end services,
such as cardiac surgery, percutaneous transluminal angioplasty and stent
(Langenbrunner, 2002).
It should be noted that the HZZO expenditure also includes substantive cash
transfers for sick and maternity leave compensation, which amounted to 1.1%
of GDP in 2002 (see Table 3.3). For reasons described in Box 3.1, these cash
transfers are excluded from the total health expenditure figures. The Government
estimates that private out-of-pocket payments and private voluntary insurance
payments account for around 2% of GDP, but reliable data on private financing
are not yet available.

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Health systems in transition Croatia
Composition of beneficiaries
Changes in the composition of beneficiaries are expected to have a significant
impact on the financial flows of the health insurance system in the coming years.
Whereas the percentage of the active workforce contributing to the HZZO has
remained stable at around one third of all the beneficiaries, the proportion of
beneficiaries falling under the categories of “unemployed” and “pensioner” has
been increasing over the last few years (see Fig. 3.1). Since health care costs
for these two groups are covered by the State and pensioners are likely to be
among the highest users of health services, the changes in the profile of the
HZZO beneficiaries is likely to lead to higher spending and lower revenue.
Contributions and revenues
The HZZO revenue structure has been heavily dependent on the salary
contributions of the 1.4 million insured employees and employers, whose
combined contributions accounted for 80% of the HZZO revenue in 2002.
Box 3.1 System of Health Accounts and definition of health expenditure
According to the System of Health Accounts’ (SHA) guidelines established by the
Organisation for Economic Co-operation and Development (OECD), the definition of
“core health care functions” excludes cash transfers, such as sick and maternity leave
compensation and related allowances. Therefore, although sick and maternity leave
compensation and allowances are administered by the HZZO, these categories of
expenses are excluded from the total health expenditure in order to maintain international
comparability. Other reports on Croatian health expenditure usually include HZZO cash
transfers, and this may explain the differences in the reported figures.
Fig. 3.1 Beneficiary composition, 1995 and 2002
Source: World Bank, 2004.
34%
9%
24%
33%
34%
17%
3%
46%
Actively employed and active farmers
Pensioners
Unemployed
Others including dependants
1995 2002

29
CroatiaHealth systems in transition
The payroll contributions have largely subsidized health care coverage for the
remaining 2.8 million insured people, with central budget transfers covering the
deficits. This financing structure has been part of the legacy of the 1993 health
reform, when the payroll tax contribution rate had been increased initially to
18% in order to cover the severe financial deficits facing the health system in
the post-war period. In 2000, the payroll tax for health insurance was lowered
to 16% as part of the Government’s fiscal policy to reduce the tax burden on
the labour force. This was further reduced to 15% in 2003, along with an added
contribution of 0.5% for occupational safety and workers’ compensation. As
shown in Table 3.6, Croatia’s payroll contribution rate for health insurance
remains among the highest in the region.
Although Croatia nominally operates a social health insurance system, the
total amount of funds allocated for health care is annually determined by the
state budget and collected through the State Treasury. The HZZO receives funds
for social health insurance from the state budget, as was previously explained,
originating from two main sources: salary contributions for compulsory health
insurance and funds collected by general taxation. Therefore, the Croatian
funding system displays characteristics specific to both Bismarckian and
Beveridge-like models.
Citizens’ views on social health insurance: pre-2002
In a survey conducted in 1999 and 2000 at the Andrija Stampar School of Public
Health at the Zagreb University School of Medicine, 500 randomly selected
adults from all regions of Croatia aged 40 and over were asked about their
attitudes towards health insurance and its reforms in Croatia as well as towards
private payments for health care services (Mastilica and Babic-Bosanac, 2002).
The survey included questions on social health insurance, private payments for
health care and background information.
Most of the citizens interviewed (83.2%) expressed the opinion that
everybody should have access to health care services, irrespective of health
insurance contributions. However, 31.2% agreed that the utilization of services
should depend on the payment of contributions. Of the respondents, 39.1%
believed that the money they contributed to health insurance corresponded to
the health care services they received and 60.1% agreed that the insurance rate
should increase proportionately to income. When asked about reforms, more
than half of those surveyed (53.4%) thought that the (pre-2002) health insurance
covered fewer benefits than 10 years earlier, whereas more than a third believed
that the changes offered more choice (36.9%) but less equity (37.7 %) and 46%
disagreed with the introduction of a basic package of health care benefits and

30
Health systems in transition Croatia
supplementary insurance. More than half of respondents thought that they had
already been paying too much for health care out of their own pockets.
The survey reflects the concerns of the Croatian public with regard to the
discussions that had started at the time on insurance reforms. This was prior
to the change in the health insurance legislation. Participants in the survey
mostly supported the principle of universal health care services provided by
the Government. Respondents did not agree with the rationing of benefits
and the implementation of market mechanisms in the Croatian social health
insurance system.
Table 3.6 Comparison of health insurance contributions in selected central European
countries
Payroll tax rate for health
Country, year
introduced
Salaried (employer;
employee)
Self-employed Non-employed
Croatia, 1993 18% (18%; 0%) 18% of declared
income
18% of gross benefits
plus central budget
transfer
Croatia, 2000 16% (7%; 9%) 18% of a set fixed
amount which
depends on formal
qualificationa
Central budget
transfer
Croatia, 2003 15% (15%; 0%)
(0.5% occupational
safety)
18% of a set fixed
amount which
depends on formal
qualificationa
Central budget
transfer
Czech Republic, 1993 13.5% (9%; 4.5%) 13.5% of declared
income
Central budget
transfer, equal to
13.5% of 80% of
statutory minimum
wage
Estonia, 1992 13% (13%; 0%) 13% of declared
income
Central budget
transfer
Hungary, 1990 14% (11%; 3%)
plus hypothecated
tax of US$ 170 per
employee
14% of declared
income
Central budget
transfer
Slovakia, 1994 13.7% (10%; 3.7%) 13.7% of declared
income
Central budget
transfer, equal to 73%
of statutory minimum
wage
Sources: Preker et al., 2002; World Bank, 2004.
Note: a The base rate is set at HRK 2318 (US$ 346), which is multiplied by coefficients (the
total of nine levels of qualifications) ranging from 1 (non-skilled workers) to 2.8 (doctoral degree
holders).

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CroatiaHealth systems in transition
Health Insurance Law 2002
The Government’s new Health Insurance Law, finalized in October 2001 and
approved in January 2002, aimed to improve the financial sustainability of the
system by reducing the extent of coverage for basic services, reorganizing the
co-payment system, stimulating the purchase of a voluntary “Supplemental
Health Insurance” plan2 and redefining the contributions from the central and
local government budgets. Under the new Law, the complementary insurance
has been introduced to allow policy-holders to purchase policies that cover the
new co-payment rates, thereby re-establishing the full level of coverage. At the
same time, new restrictions have been imposed on the private sector. The new
Law enacted some reforms, as shown below.
A new co-payment “price schedule” for selected services in the current
benefits package, with higher rates for hospital and specialist services,
diagnostic tests and pharmaceuticals. Although the major categories
of exemptions remain, the categories of beneficiaries exempt from co-
payments have been reduced to some extent compared to previous years
(see Table 3.7).
Compulsory basic insurance coverage is exclusively provided by the
HZZO, thus removing the “opt-out” clause, which had permitted those with
income above a certain level to purchase substitutive private insurance in
place of the HZZO basic plan. Implicitly, there was an expectation that the
complementary insurance would act as a new tax revenue source for the
HZZO (Langenbrunner, 2002).
The option for consumers to purchase complementary insurance policies
on a voluntary basis, covering co-payments and restoring the full coverage
of the basic health services. From 2002 to 2004, complementary insurance
was exclusively offered by the HZZO. The community-rated premium is set
at HRK 50 (retired) and HRK 80 (working age) (US$ 7.50–11.90 in 2003
US$) per month, which can be paid at individual or employer level. As an
added incentive, a tax refund equivalent to the amount of the cumulative
premium for one year is given to any individual or employer that purchases
complementary insurance.3
•
•
•
2 The Croatian use of the term “Supplemental Health Insurance” under the Health Insurance Law
2002 should not be confused with the technical definition of the different categories of voluntary
health insurance used in the EU context. Under these definitions, the Croatian “Supplemental Health
Insurance” plan would be categorized as “complementary voluntary health insurance” (see Table 3.1).
3 Personal Income Tax Law (Official Gazette, 127/00) allows for premiums for additional health insurance
(including premiums for life and voluntary pension insurance) to be tax-deductible expenses from July 1,
2001. The rebate is open-ended and can be renewed each year.

32
Health systems in transition Croatia
A clarification of central and local governments’ responsibilities for
providing subsidies to vulnerable categories of the population, which were
until 2002 mainly subsidized from payroll contributions.
The administration of a workers’ compensation fund for occupational safety
under the HZZO.
The new Law represented an important step in rationalizing health system
financing, but it also raised a number of new issues. The effectiveness of the new
co-payment system in mitigating excessive utilization was undermined by the
broad exemptions as well as the effect of the “Supplemental Health Insurance”
plan, and as a voluntary plan, “Supplemental Health Insurance” was open to
adverse selection problems, i.e. the plan was more likely to be purchased by high-
end users, such as pensioners, which was further exacerbated by the discount
policy for the pensioners (who were given a 50% discount on “Supplemental
Health Insurance” premiums to encourage their participation).
The categories of the population exempt from paying contributions prior to
the 2002 Health Insurance Law were children under 18 years of age, pensioners,
pregnant women and those receiving maternity benefits, farmers, unemployed
people, those in households where the head of the household is over 65, and
social assistance beneficiaries. These groups made up somewhere between
1.7 million and 2.0 million of a total population of approximately 4.5 million
(38–44%). Until the 2002 legislation, the HZZO covered insurance contributions
for these groups.
In terms of real uptake of complementary insurance, in 2002 approximately
50% of the “Supplemental Health Insurance” was being purchased by
pensioners, who are considered high-end users of health care services. In the
first year of implementation, revenue exceeded expenditure, but as the market
matures it is likely that the utilization rates and expenditure will eventually
overtake revenues.
Although data for 2004 and 2005 are not publicly available, government
officials have indicated that in those years the complementary insurance
scheme has incurred financial deficits and is no longer financially sustainable.
Several options for further reforms are being debated at the time of writing,
including abolishing complementary insurance completely, as was the case in
neighbouring Slovenia, and allowing private insurers to enter the market and
compete for customers on the basis of risk-rated complementary insurance
plans.
•
•

33
CroatiaHealth systems in transition
Amendments to the Health Insurance Law of 2005
The amendments to the Health Insurance Law of 1 October 2005 have further
increased the co-payments schedule from 2002 by introducing “administrative
fees” into the system of finance. All patients, with the exception of people under
18 and the disabled (with invalidity over 80%), are required to pay deductibles
of HRK 5 or HRK 10 (US$ 0.83 or US$ 1.66)4 (charged by their respective GP)
for obtaining certain products and services, such as prescriptions or referrals
to specialists. If a patient bypasses the gatekeeping system by seeking care
directly from a hospital emergency ward without prior consultation with his
GP, then specialist consultations in emergency departments not judged to be
of an emergency nature are also subject to an administrative fee of HRK 10
(US$ 1.66). The maximum amount of “administrative fees” that can be charged
to a patient is HRK 30 (US$ 4.96) per month. Further referrals, prescriptions,
etc. are free of charge.
Other amendments to the 2002 Health Insurance Law introduced in October
2005 include cutbacks in the HZZO’s financial participation in patients’
transportation and funeral costs.
According to the Croatian Minister of Health, Dr. Neven Ljubicic,
amendments to the Health Insurance Law were necessary as the public health
care system faced a serious lack of funds that threatened to disable it from
providing a high-quality level of services (Cafuk, 2006).
Allowances other than health care
Croatia continues to provide one of the most generous sick leave compensation
packages by international standards. Since the State takes on almost the entire
risk of added labour costs due to illness or maternity, there is little incentive on
the part of the employers and employees to be judicious in the use of sickness
benefits. As a result, there are indications that the current system is subject to
abuse, often as a result of collusion between employer and employee, who may
use the sick benefit for other purposes, e.g. in lieu of unemployment benefits.
Under the 2002 Health Insurance Law, some modest reductions in the level
of compensation were introduced (see Table 3.7), but the benefits remain
essentially unchanged.
Since policy formulation and analysis of sick and maternity benefits are more
appropriately considered as part of employment policies rather than of health
4 All figures in this paragraph are in 2004 US$ according to the average 2004 exchange rate as reported by
the Croatian National Bank.

34
Health systems in transition Croatia
Status before 2002 Health Insurance Law 2002
Exemptions for: 1. Exemptions for:
• People under 18
• Unemployed people
• Homeland War Veterans and members of
their families; family members of deceased
members of the Croatian Army or Police
Forces who died as a consequence of
wounds received during the war, were
imprisoned or missing, political prisoners
and World War II veterans; civil invalids
• Refugees and returnees
• Pregnant women receiving maternity
benefits
• Voluntary blood donors with more than
50 blood donations and donors of human
body parts
• Beneficiaries of social care institutions
whose costs were either fully or partly
covered by social care institutions
• Individuals with an income below HRK
1275 per month
• Pensioners with an income below HRK
1700 per month
• Disabled people with permanent physical
damage with an income below HRK 2550
per month
• Individuals injured at work or suffering
from an occupational disease
• People suffering from infectious or mental
diseases undergoing treatment
• Individuals participating in organized
health care measures
• All pensioners and voluntary blood donors
with more than 25 blood donations exempt
from co-payment for prescription drugs.
• People under 18
• Disabled people; people with at least 80%
disability
• Croatian Homeland War invalids
• Pregnant women receiving maternity
benefits
• People with monthly per-capita income
below HRK 1516.32 from March 2004
• Pensioners living alone with monthly
income below HRK 1939.40 from March
2004
• Voluntary blood donors with more than 35
(men) and 25 (women) blood donations.
2. General Revenue Subsidies on
Contributions
General revenue contributions from central
and local governments are transferred to
the HZZO for selected categories of the
population in order to compensate for
differences between the HZZO reimbursement
and the full cost of health services.
Central Government compensates HZZO for
the following categories of the population:
Unemployed people; people without health
insurance over 18; draftees and military
reservists during service; farmers over 65;
individuals incapable of independent living
and work; people without means of support;
war or civil invalids and beneficiaries of the
survivor’s disability pension; Homeland War
Veterans; secondary school students and
regular university students without health
insurance coverage.
Central or local government compensates
health insurance for the following categories
of the population: People participating in
public works and civil protection programmes;
members of operation units of fire-fighting
brigades; and beneficiaries of financial
compensation for physical injury according to
pension regulation.
Table 3.7 Changes in co-payment exemptions and central and local government
contribution policies under the new Health Insurance Law 2002
Source: World Bank, 2004.

35
CroatiaHealth systems in transition
care, consideration could be given to moving their administration outside of
the view of the Health Insurance Fund. This will permit the integration of sick
benefits into labour and social welfare programmes, while allowing the HZZO
to concentrate its resources on developing the expertise and capacity of its core
functions, namely the financing of health services, and ensuring access to cost-
effective and high-quality medical care for the covered population.
3.2 Complementary sources of financing
According to government estimates, prior to the 2005 reform, 80% of the
overall health care expenditure was from public funds. The other main sources
of financing for health care services are out-of-pocket payments and private
health insurance.
3.2.1 Out-of-pocket payments
A continuing tendency to increase private out-of-pocket payments for health
care has emerged under the health care system reforms in Croatia. It could be
viewed as a part of a broader governmental policy of “privatizing and rationing”
the health care system (Hebrang, 1994). In order to control and gradually reduce
expenditure on health care, the Government applied measures that primarily
influence the supply side or aim to reduce demand for services and raise the
financial responsibility of the insured. The introduction of cost sharing, the
reduction of the list of prescription drugs, the expansion of the private medical
sector, and other forms of personal formal and informal spending related to
health care have increased direct payments on such a large scale that citizens
view it as a significant burden (Mastilica and Bozikov, 1999).
In 2002, the Government estimated that private spending constituted
approximately 2.0% of GDP, or one fifth of the total spending on health care in
Croatia. Results of the Household Budget Survey conducted in 2001 suggested
that direct household spending on health care accounted for approximately 1.2%
of GDP (see Table 3.8). Reported revenue from health care providers indicated
that reimbursements from private insurers accounted for approximately 0.7%
of GDP.
It should be noted that the Household Budget Survey results might have
underestimated actual household spending, owing to a relatively long recall
period (four months) used for outpatient services and medical products.5
5 Typically, recall periods of two to four weeks are used for these expenditure items.

36
Health systems in transition Croatia
Furthermore, as the Household Budget Survey was implemented in 2001, it
does not show the effects of the 2002 and 2005 reforms of the Health Insurance
Law, which have significantly increased the role of private payments in funding
health care.
The analysis of the Household Budget Survey data did not reveal any
regressive spending patterns by income quintiles with respect to mean per-capita
health spending. However, when groups are divided according to their social
welfare status, it is evident that the pensioners and disabled people incurred the
highest out-of-pocket expenditure. This is not surprising given that they face
chronic conditions that require frequent and repeated use of health services
and products.
A more revealing pattern emerged when the variance on expenditure was
analysed for different categories of households. Tables 3.8 and Table 3.9 show
household health expenditure by income quintile groups and welfare status,
respectively. For example, retired individuals spent on average 779 HRK (US$
93), or 3.54% of total household expenditure on health (see Table 3.10). When
the distribution of expenditure was analysed for this category of household,
it revealed that some 6.8% of retired people spent more than 10% of their
household budget on health care (see Table 3.11). This would suggest that by
2001 a significant number of pensioners were already facing a major financial
burden, and that the existing health insurance system was not adequately
providing protection for these groups of beneficiaries. The effects of higher
co-payments and the complementary insurance scheme introduced in 2002 as
well as the administrative fees introduced in 2005 require further analysis.
Table 3.8 Mean household spending on health, in HRK (US$a), 2001
Mean HRK
per capita
per year
Share of total
household
expenditureb
Household health expenditure per capita 447 (54) 2.02% (0.09)
- medical products 274 (33) 1.24% (0.05)
- outpatient services 156 (19) 0.71% (0.06)
- hospital services 16 (2) 0.07% (0.02)
Household expenditure per capita 22 092 (2 649)
GDP per capita 36 712 (4 402)
Household expenditure on health, as % of GDP 1.22%
Sources: World Bank, 2004; Central Bureau of Statistics, 2003.
Notes: a US$ figures calculated on the basis of the 2001 annual average of the US$/HRK
exchange rate, as reported by the Croatian National Bank; b For the “Share of total household
expenditure” column, standard errors are reported in parentheses (clustered on household
identifiers); GDP per capita is estimated by dividing total GDP in 2001 (HRK 162.9 billion) by
population (4.437 million); billion = 1000 millions.

37
CroatiaHealth systems in transition
Informal payments outside of formal co-payments appear to be a fairly
widespread phenomenon. Preliminary results from a 2002 study conducted
by the HZJZ on informal payments in Zagreb suggested that some 44% of
respondents who used health services indicated that they had made some
form of informal payment. An earlier study conducted in 1994 (Mastilica and
Bozikov, 1999) also confirmed that co-payments accounted for only a small
Table 3.9 Household health expenditure by income quintile groups, in HRK (US$a), 2001
Income
quintile
groupb
Mean health
expenditure
(per capita, per
year)
Mean total
expenditure
(per capita, per
year)
Share of health
expenditure
(as a % of total
expenditure)
Estimated
population
1 (lowest) 214 (26) 12 606 (1 512) 1.69% 848 479
2 308 (37) 16 588 (1 986) 1.86% 847 538
3 443 (53) 21 639 (2 595) 2.05% 847 782
4 498 (60) 25 104 (3 010) 1.99% 848 530
5 (highest) 772 (93) 34 549 (4 143) 2.24% 846 436
Total 447 (54) 22 092 (2 649) 2.02% 4 238 764
Source: World Bank, 2004.
Notes: a US$ figures calculated on the basis of the 2001 annual average of the US$/HRK
exchange rate, as reported by the Croatian National Bank; b Quintile groups are created
according to total income per capita.
Table 3.10 Household health expenditure by welfare status, in US$,a 2001
Mean health
expenditure
(per capita, per
year)
Mean total
expenditure
(per capita, per
year)
Share
(as a % of total
expenditure)
Estimated
population
Employed 49 3 075 1.58% 1 141 429
Self-employed 52 2 651 1.98% 419 014
Unemployed 31 2 156 1.44% 277 308
Retired 93 2 636 3.54% 818 712
Others (inactive) 44 2 510 1.75% 581 598
Disabled 57 2 362 2.41% 312 818
Age 15 and under 31 2 404 1.29% 687 886
Total 54 2 649 2.02% 4 238 764
Source: World Bank, 2004.
Notes: a US$ figures calculated on the basis of the 2001 annual average of the US$/HRK
exchange rate, as reported by the Croatian National Bank; All amounts are attributed to the
individuals according to household expenditure per capita. Welfare status is based on the
individual’s most frequent activity status in the last 12 months, except for disabled people,
whereby status is defined by self-reported disability to work, receiving an invalidity pension or
receiving other invalidity benefits.

38
Health systems in transition Croatia
share of household expenditure on health care with the greater share spent on
informal payments.
Thus, exemption from co-payments may provide only limited relief from the
financial burden of medical care for low-income households. Other forms of
direct payment include payments for private consultations and non-prescription
drugs and informal payments for physicians.
3.2.2 Private health insurance
In 2005, five major insurance companies offered private health insurance: Zagreb,
Sunce, Croatia Osiguranje, Addenda and Grawe. The package of supplementary
health insurance is sold in a few dozen variants and primarily marketed and sold
to employer groups, such as banks and large firms. Increasingly, these packages
attract international companies with both domestic and international workers.
The supplementary insurance mostly covers “upgrades” on medical services,
facilities and pharmaceuticals, including private care. It may also cover out-of-
country surgery, notably in Germany and the United Kingdom (Langenbrunner,
2002). Since 2004, it may cover co-payments charged by public providers. The
Health Insurance Law of 2002 has initiated a setback in the growth of the private
insurance market in Croatia, as private insurers were suddenly closed out of the
substitutive health insurance market6 (see Fig. 3.2).The regulatory framework
for the medical insurance market remains largely undeveloped.
Table 3.11 Distribution of relative health expenditure by social welfare status, 2001
Relative
expenditure on
health
Relative frequencies (within groups)
(% of total health
expenditure)
Employed
(%)
Unemployed
(%)
Retired
(%)
Disabled
(%)
Others
(inactive
and age
15 and
under)(%)
Total
(%)
0 23.5 32.8 16.6 26.1 25.7 23.7
0–2 51.0 46.6 32.4 37.5 51.9 46.4
2–5 18.6 14.2 26.5 24.7 15.0 19.2
5–0 5.1 3.9 17.8 7.9 5.7 7.9
+10 1.8 2.4 6.8 3.8 1.5 2.9
Source: World Bank, 2004.
Note: Social welfare status is based on the most frequent activity status in the last 12 months,
except for disabled people, whereby status is defined by self-reported disability, receiving
invalidity pension or receiving other disability benefits.
6 Voluntary health insurance is not permitted to substitute for the “Basic Health Insurance”.

39
CroatiaHealth systems in transition
3.2.3 External sources of funding
Croatia joined the World Bank in 1993. Since then, the World Bank has assisted
the country with financial support, technical assistance, policy advice and
analytical services. The World Bank has been actively involved in the health
sector reform and provided assistance through its country-specific analytical
studies and investment lending.
The first Health System Project for Croatia was completed in 1999 and
was funded by a US$ 40 million loan, with a focus on post-war reconstruction
needs in the health sector. The Structural Adjustment Loan completed in 2003
that supported the Government’s structural reform agenda had a health sector
component to enhance fiscal discipline. The current Health System Project,
funded by a US$ 29 million loan from the World Bank provides support to
the health sector from improving health service delivery to promoting public
health and prevention.
Fig. 3.2 Relationship between voluntary and statutory health insurance, 1993–2004
1993 2002 2004
Voluntary Voluntary Voluntary
Co-payment Co-payment Co-payment
Covered
under
Statutory
Health
Insurance
Covered
under
“Basic
Health
Insurance”
Covered
under
“Basic
Health
Insurance”
Covered by Private Voluntary Health Insurance
Covered by HZZO
Covered by HZZO
Covered by HZZO
Occupational
health
Occupational
health
Occupational
health
Private
Insurance
Private
Insurance
Services not covered by HZZO
Basic Health Services covered exclusively by HZZO
Co-payments on Basic Health Services covered by HZZO
Source: World Bank, 2004.

40
Health systems in transition Croatia
The World Bank is engaging the new Government in the 2004–2007
Country Assistance Strategy. The Bank is working with the Government to
prepare a Programmatic Adjustment Loan with a health component to improve
sustainability of health financing.
3.3 Health care expenditure
Croatia spends a relatively high share of its GDP on health. As shown in Table
3.12 below, there was a period of rapid cost escalation in the late 1990s, which
peaked in 2000. From 2000 until 2002, it appears that public spending was
contained. According to the Croatian Ministry of Health, in 2003 total spending
on health was estimated at 8.9% of GDP, in 2004 at 9.7% of GDP and in 2005
at 8.7% of GDP. The “rise” of expenditure in 2004 is attributed to the settlement
of HZZO and hospital arrears from 2000, 2002 and 2003, which amounted to
more than HRK 3 billion (more than US$ 532 million) (Ministry of Health,
2006). The major share of public health spending in Croatia is accounted for by
the HZZO. The HZZO funds most direct spending on personal health services
while the central Government funds public health services, capital investments,
research and health administration.
As part of the general decentralization policy, a small but increasing share of
public spending on health is being picked up by the local governments. In 2002,
county governments spent just 3% of their revenues on health care compared
to nearly 20% for education (World Bank, 2004).
Reliable data on private spending are currently not available, but as was
previously discussed, government estimates place private spending somewhere
around 2% of GDP, or approximately one fifth of total health expenditure (see
Table 3.13). Private spending includes expenditure on private health insurance,
direct out-of-pocket payments by households, and voluntary spending by private
corporations on health services for their employees. It should be noted that the
estimate of 2% of GDP for the year 2002 could be an underestimate, especially
if the cost-containment policy on the public side resulted in cost shifting to
private spending. If one assumes that private spending remained constant at
2% of GDP in 2002, then there was a real decrease in total spending on health
care in that year. On the other hand, if private spending increased to compensate
for the decline in public spending on health, then the total spending on health
care might not have decreased. From 2002 to 2005, the Croatian Ministry of
Health estimates that private spending in health care remained at 2% of GDP
(Ministry of Health, 2006).

41
CroatiaHealth systems in transition
In 2002 Croatia spent a higher proportion of its GDP on health (9.1% in
2002, down from the all-time high of 10.2% in 2000) compared to the central
and Eastern European countries’ average of 5.9%, the newly independent states’
average of 2.9% and the EU average of 8.9% in 2001. However, owing to the
rise of its GDP and cost-containment efforts in health care, Croatia has been
able to reduce spending to 8.7% of GDP in 2005.
Nevertheless, despite the reductions, the Croatian health care system is still
heavily burdened by arrears. According to the Croatian Ministry of Health, in
December 2004 clinical hospitals owed HRK 1.3 billion (US$ 216 million),7
general hospitals owed HRK 890 million (US$ 148 million) and special hospitals
owed HRK 180 million (US$ 30 million) to various suppliers (Ministry of
Health, 2006). By the end of 2003, HZZO’s debts grew to HRK 3.686 billion
(US$ 613 million), of which HRK 980 million (US$ 163 million) was for
pharmaceuticals (Ministry of Health, 2004).
Furthermore, reforms of the Croatian health care system focused mainly
on centralizing financing, rationing services, and encouraging the provision
of private health services with incentives. Although these changes may have
contained costs, they have increased the inequality of access to health care and
proved highly unpopular with users (Mastilica and Kusec, 2005).
Compared to selected European countries, when analysing specific categories
of expenditure Croatia spends the highest percentage of total health expenditure
on the category pharmaceuticals and medical consumables, and one of the
lowest percentage on inpatient services (see Table 3.14).
Table 3.12 Estimated total spending on health, as a percentage of GDP, 1998–2002
1998 1999 2000 2001 2002
HZZOa6.9 7.6 8.0 7.3 6.6
Ministry of Healthb0.6 0.3 0.2 0.1 0.2
Local government 0.1 0.1 0.0 0.1 0.2
Total public
expenditure on health 7.6 8.0 8.2 7.6 7.0
Estimated private
spending on healthc1.6 2.0 2.0 2.0 2.0
Total health care
expenditure 9.2 10.0 10.2 9.5 9.1
Source: World Bank, 2004.
Notes: a Excludes cash transfers for sick and maternity leave, but includes operating expenses
of HZZO; b Direct budget of Ministry of Health for policy, regulation, public health and related
activities; c Government estimates.
7 All figures in this paragraph are in 2004 US$ according to the average 2004 exchange rate as reported by
the Croatian National Bank.

42
Health systems in transition Croatia
The share of public health care expenditure in overall health expenditure
remains high relative to all EU countries, but this, as mentioned earlier, can be
deceptive to the extent that private health care expenditure is only estimated
and there are no reliable data available on private spending.
Table 3.13 Per-capita spending on health (total, private and public), 1997–2002,
in constant HRK (1997 prices (US$a))
1997 1998 1999 2000 2001 2002
Total
2 268
(368)
2 728
(443)
2 885
(469)
3 053
(496)
3 056
(496)
2 899
(470)
Privateb
433
(70)
451
(73)
551
(90)
558
(91)
605
(98)
637
(103)
Public
1 835
(298)
2 276
(370)
2 334
(379)
2 495
(405)
2 450
(398)
2 262
(367)
Source: World Bank, 2004.
Notes: a US$ figures calculated on the basis of the 1997 annual average of the US$/HRK
exchange rate, calculated by the Croatian National Bank; b Assumes private spending at 2% of
GDP, based on government estimation.
Table 3.14 Comparison of health spending by function, Croatia and selected European
countries
Categories of
expenditure
Czech
Republic
1999
Denmark
1999
Germany
1998
France
1999
Italy
1997
Croatia
2001
Inpatient 35.1 53.9 34.4 43.8 44.5 27.3
Outpatient,
ancillary and
home health 27.4 32.5 34.0 26.8 27.7 34.7
Pharmaceuticals
and medical
consumables 27.0 9.0 12.7 22.8 17.5 21.2
Therapeutic
appliances 3.4 2.5 6.1 2.2 2.2 3.4
Others (health
administration,
public health,
etc.) 7.1 2.1 12.8 4.4 8.1 13.4
Total 100.0 100.0 100.0 100.0 100.0 100.0
Sources: OECD, 2001; Croatia figures were calculated by the author based on available data
on government, private insurance and household expenditure.

43
CroatiaHealth systems in transition
4.1 Public health services
4.1.1 Institutional responsibilities and organization
Public health services in Croatia have a long-standing tradition. The
Ministry of Health and the HZJZ are responsible for determining the
national strategy for public health, setting national annual targets,
measuring and monitoring performance against set targets and, together with
the county public health institutes, organizing and delivering preventive and
health promotion services.
Public health services are organized through a Network of Public Health
Institutes: one state institute (HZJZ) and 21 county institutes. Their internal
organization comprises the following departments: epidemiology, social
medicine, environmental health, microbiology and school health. Each
department is responsible for implementing programmes in its area of work and
overseeing the work of relevant services at county level. The Network of Public
Health Institutes provides the following services: epidemiology of quarantine
and other communicable diseases, epidemiology of noncommunicable diseases,
water, food and air safety, immunizations, sanitation, health statistics and health
promotion. Additionally, the system monitors the work of health care providers
in terms of the number of services provided, distribution of personnel, etc.
Public health institutes are also responsible for overseeing compulsory
immunization programmes. These programmes are carried out by primary
health care doctors (family doctors and primary health care paediatricians)
and school doctors for children of school age. Non-compulsory vaccination
programmes are delivered through family medicine doctors or county public
health institutes.
4 Health care delivery system

44
Health systems in transition Croatia
The National Centre for Addiction Prevention works under the HZJZ and
runs the National Register of Treated Psychoactive Drug Addicts, founded
in 1978. From 2003, county Centres for Addiction Prevention form a part of
county institutes of public health.
Ownership of public health institutes is distributed across two levels: the
HZJZ is owned by the Ministry of Health, while county institutes belong to
the respective counties. Services are funded from several sources, mostly state
and county budgets. Some services are contracted by the HZZO or charged
directly to users.
The Croatian National Institute of Public Health (HZJZ)
The HZJZ is responsible for the collection, analysis and presentation of statistics
and epidemiological data and for health promotion and health education at
national level. It also maintains a number of public health registers, including:
the Croatian National Cancer Register, the Croatian National Psychoses Register,
Suicides in Croatia, the Croatian National Register of Treated Psychoactive
Drug Addicts, the Tuberculosis (TB) Register, the HIV Register, the Register
of Legionnaire’s Disease, the Croatian Register of Disabled Persons and the
National Health Workers Register.
The Ministry of Health consults the HZJZ on all matters pertinent to
public health policy and priorities. The HZJZ proposes national anti-epidemic
measures, supervises compulsory immunizations and pest control, monitors
environmental pollution and waste maintenance, sets standards and tests food
safety and drinking water. It participates in research targeted at health care
personnel, the health care system, health promotion and prevention programmes.
It also supervises and coordinates all county institutes of public health.
The Croatian Institute of Blood Transfusion Medicine
The Croatian Institute of Blood Transfusion Medicine organizes blood collection
through health care providers and humanitarian actions. It stores and distributes
blood and its components and products. It carries out specific haematological
analyses and controls transfusion activities. In Croatia, blood is collected solely
through voluntary donations and there are no donation fees.
The Croatian Occupational Health Institute
The Croatian Occupational Health Institute is a health care institution for
provision of specific health care for employees in the country. This Institute

45
CroatiaHealth systems in transition
coordinates and expertly supervises all occupational health offices that provide
specific health care services for employees.
Established at tertiary care level, the Occupational Health Institute is
responsible for proposing, planning and carrying out measures for the
maintenance and advancement of workers’ health. Its responsibilities
include: developing a doctrine, standards and working methods in the area of
occupational health; following up on the health of employees with specific
working conditions; participating in the education, coordination and overseeing
of professional activity for occupational health practices; and keeping registers
and statistical surveys related to occupational health.
The Occupational Health Institute also offers expert assistance in drafting
health legislation, supervising the implementation of specific health care for
employees, and cooperating with all levels of existing health care services.
The Croatian Mental Health Institute
The Croatian Mental Health Institute works to plan, propose and implement
measures to protect and improve the mental health of the population. This
Institute plans and proposes development strategies and programmes towards the
improvement of mental health care and psychiatric care at primary, secondary
and tertiary care levels.
Furthermore, the Mental Health Institute conducts research on mental
health care and psychiatric care in order to monitor, analyse and evaluate the
mental health of the population. It aims to protect and improve mental health
with health education, promotion and other activities, and plans, coordinates
and controls specific care towards improving the mental health of children and
youths, especially in primary and high schools, as well as in universities.
The Mental Health Institute collects and analyses epidemiological data on
mental illnesses and disorders for the mental illness registry. Additionally, it
monitors and evaluates quality measures for prevention, diagnosis and treatment
in mental health care and psychiatric care, and takes part in health personnel
education.
The Croatian Institute of Toxicology (CIT)
The primary role of CIT is the protection of human health from harmful
chemicals. It does this by issuing preliminary appraisals for products with the
potential to pose human and environmental health hazards, if used improperly.
CIT maintains records of the notified new substances and their notifiers,
aggregate annual lists of procès-verbal by corporations and individuals, and

46
Health systems in transition Croatia
data from manufacturers’ technological safety sheets, as well as a Biocidal
Preparations and Poisonings Registry.
In addition, it verifies the validity of product labels and of user instructions;
organizes and conducts education for protection from hazardous chemicals;
and issues information certificates on the protection of harmful chemicals. It
also participates in safety overseeing, and inspections of, the central stocks
of antidotes in Croatia and undertakes informational-documentation and
informational-consulting activities relating to acute poisonings with hazardous
chemicals.
The National Institute for Radiation Protection
Established by the Ionizing Radiation Protection Act, the National Institute
for Radiation Protection has evolved from the Croatian Institute for Radiation
Protection. It is responsible for keeping records about the sources of ionizing
radiation that are prepared by personnel and on the abilities and qualifications of
source handlers. The Institute also explores the presence and strength of ionizing
radiation in the environment, both under normal conditions and in the case of
accidents. It also proposes protective measures; supervises the transportation
and consumption of radioactive materials; monitors and analyses the levels
of exposure of individuals with occupational exposure to radiation; applies
the intercommunicative system of personal dosimeters; as well as examining
individuals exposed to radiation in the course of diagnostic and therapeutic
procedures.
The Drug and Medical Products Agency
Established under the Drug and Medical Products Act (Gazette of the Republic
of Croatia 121/03 and 117/04), the Drug and Medical Products Agency evolved
from a merger between the Croatian Institute for Drug Control and the Croatian
Institute for Immunological Preparation Supervision. Its main objectives
are to define drug quality standards and procedures; ensure the quality of
medicines in manufacture and marketing; supervise the quality of medical
accessories and equipment; perform assays and other procedures as needed
by the pharmaceutical industry; provide expertise as needed by government
administrative bodies and authorized health bodies; and the preparation and
publication of the Croatian Pharmacopoeia, along with participation in the
European Pharmacopoeia.
The Agency is also responsible for preparing periodic reports on the quality
of medicines. Following the provisions of the Drug and Medical Product Act,

47
CroatiaHealth systems in transition
the Agency controls all certified immunological preparations and decides on
the conditions for the release of registered immunological preparations to
the market. All high-biotechnology preparations must be passed by strict and
sophisticated methods, because of the risk of transmission of viral, prion and
other diseases.
Education
Medical universities and the Andrija Stampar School of Public Health provide
professional education and capacity building for public health professionals. The
School of Public Health organizes several postgraduate courses in public health
specialties (i.e. public health, epidemiology, medical informatics, occupational
health, medical ecology). In 2002, the School launched a postgraduate course
on “Leadership and management in health services”.
4.1.2 Public health programmes and activities
Organized public health care services and activities have kept infectious
diseases under control. Under the National Mandatory Immunization Schedule,
approximately 500 000 people are immunized annually, receiving approximately
900 000 individual doses of mostly polyvalent vaccines (a single application
containing two or three different vaccines). The target coverage stipulated by
the Schedule for most vaccinations is 95%. This target coverage was achieved
for all primary vaccinations in 2005 (whereby immunity base is formed at the
infant/young child age).8 For example, the level of immunization for measles
was 96% in 2004, similar to the Netherlands, Denmark, Albania and Estonia
(Fig. 4.1). Repeat vaccination for those under 18 years takes place periodically
under the Schedule. Diseases preventable through vaccination have either totally
disappeared (diphtheria, poliomyelitis) or their incidence has been drastically
reduced by more than 90%. Morbidity from measles has been reduced by 99%,
along with mumps (98%), rubella (99%), pertussis (97%), tetanus (93%) and
TB (89%) (HZJZ, 2004a).
Immunization against influenza is free for the elderly, health workers and
individuals suffering from immunodeficiency disorders. In 2005, around
600 000 people in Croatia were vaccinated. As a result, there was a noted
decrease in the number and duration of sick leave cases among the active
working population.
8 Primary vaccinations given to children differ from repeat/booster vaccinations.

48
Health systems in transition Croatia
Fig. 4.1 Levels of immunization for measles in the WHO European Region, 2004
Percentage
Western Europe
Monaco
Andorra
San Marino
Spain
Finland
Netherlands
Denmark
Luxembourg
Israel
Portugal
Sweden
Iceland
Germany
Norway
Greece
Malta
Cyprus
France
Italy
Belgium
Switzerland
Ireland
United Kingdom
Turkey
Austria
Central and south-eastern Europe
Hungary
Latvia
Slovakia
Lithuania
Poland
Romania
Czech Republic
The former Yugoslav Republic of Macedonia
Albania
Croatia
Serbia and Montenegro
Estonia
Bulgaria
Slovenia
Bosnia and Herzegovina
CIS
Kyrgyzstan
Ukraine
Tajikistan
Belarus
Kazakhstan
Uzbekistan
Russian Federation
Azerbaijan
Turkmenistan
Republic of Moldova
Armenia
Georgia
88
96
96
96
97
97
97
98
99
100
74
81
81
81
82
82
84
86
86
87
88
93
95
95
95
95
96
96
97
97
98
98
99
96
96
95
94
99
99
99
99
99
99
98
98
97
96
92
86
88
98
93
70 80 90 100
Source: WHO Regional Office for Europe, 2006.
Note: CIS: Commonwealth of Independent States.

49
CroatiaHealth systems in transition
Communicable diseases
HIV/AIDS
According to the HZJZ (2006b), from 1985 until December 2005, 553 HIV-
positive individuals and 239 AIDS cases were reported in Croatia. Since the
mid-1990s, between 30 and 60 new HIV/AIDS cases were reported annually.
In Croatia, HIV/AIDS primarily affects men who have sex with men (40.3% of
all reported HIV cases), followed by heterosexual transmission (40.0% of all
reported cases). Most of the heterosexual transmission is due to imported cases
of people who have many sexual partners. More than 80% of all reported HIV/
AIDS cases are male and 80% of all reported cases are adults aged 20–49.
The State provides highly active antiretroviral therapy (HAART) to all
infected individuals who require it. In 2005, 267 individuals were receiving
HAART therapy. Treatment of HIV/AIDS is centralized in the capital Zagreb.
Voluntary counselling and testing (VCT) centres operate in Zagreb, Rijeka,
Split, Dubrovnik, Osijek, Pula and Zadar. All blood donations are tested for
HIV antibodies (HZJZ, 2004a).
In June 2003, Croatia started its Global Fund to Fight AIDS, Tuberculosis
and Malaria (GFATM)-funded project aimed at interventions focusing on
vulnerable population members (intravenous drug users, men who have sex with
men, commercial sexual workers, migrants and young people). The GFATM
project aims to develop the following interventions: peer education, exchange
of syringes and needles, condom promotion and distribution, strengthening
nongovernmental organizations’ (NGOs) capabilities, improving counselling
skills of medical professionals and increasing access to VCT services.
Tuberculosis
During the war, an increase was observed in the incidence of TB. This was
mainly attributed to the significant inflow of refugees from less-developed areas
of the former Yugoslavia. In 1997, the incidence rate for all forms of TB per
100 000 population was 45, considerably higher than the 13 per 100 000 EU
average (WHO Regional Office for Europe, 2000). During the last few years, the
incidence trend has been falling and was 26 per 100 000 population in 2005.
Food-borne diseases and intoxications
In Croatia, food-borne diseases are monitored through a well-established
system for the surveillance of communicable diseases. The Department of
Epidemiology at the HZJZ and the 21 county institutes (comprising 113
independent epidemiological units) are responsible for the collection and

50
Health systems in transition Croatia
distribution of surveillance data. Outbreaks of infectious diseases, including
food-borne diseases and intoxications, are reported immediately by telephone
or fax. Following an epidemiological investigation and the gathering of relevant
data, the outbreak is reported (by statutory obligation) on a special form to the
corresponding county institutes and to the HZJZ (WHO Regional Office for
Europe, 2000).
In 1999 and 2000, 66 and 79 cases of outbreaks of food-borne diseases,
respectively, were reported to the HZJZ. This reflects an upward trend observed
since 1996 (see Fig. 4.2).
In more than 90% of the food-borne outbreaks investigated in 1999 and
2000, the food responsible for the diseases was identified. Meat and meat
products and eggs and egg products continue to be the most frequently reported
categories involved in these outbreaks. Notably, egg cream cakes, sausages and
pork played a dominant role.
Source: WHO Regional Office for Europe, 2003.
Fig. 4.2 Food-borne disease outbreaks and cases reported, 1993–2000
1 000
2 000
3 000
4 000
5 000
6 000
7 000
8 000
9 000
10 000
1993 1994 1995 1996 1997 1998 1999 2000
0
20
40
60
80
100
No. of cases in outbreaks No. of single cases No. of outbreaks
No. of cases No. of outbreaks

51
CroatiaHealth systems in transition
4.1.3 Health promotion and education
Policy framework
The policy framework for health care and health insurance is founded in the
acts listed below.
The Health Care Act states that each person has a right to health care and the
possibility to accomplish the highest possible level of health. Nobody has the
right to endanger the health of others. The principle of an integrative approach
to primary health care is ensured by implementation of consolidated health care
measures, including health promotion and disease prevention.
The Health Insurance Act identifies categories of those individuals who
have the right to health insurance, which includes all population groups and
subgroups including the unemployed, the chronically ill and the disabled. The
right to health care is ensured according to the Health Care Measure Plan and
Programme.
In accordance with the Health Care Act, the Croatian Minister of Health
enacts for each biennial a Health Care Measure Plan and Programme. Health
priorities are selected based on situational analysis – according to which Croatia
has an ageing population and a population growth rate with negative natural
increment (more people are dying than new babies are born); morbidity and
mortality indicators; chronic noncommunicable diseases; and injuries that are
nationally prevalent.
The following priorities were listed by the Health Care Measure Plan and
Programme, which has been in force since 2002.
Vulnerable groups: women, infants and young children, school-age children
and young people (including full-time students and the active working
population).
Public health problems: cardiovascular diseases (arterial hypertension,
ischaemic heart disease and cerebrovascular diseases), malignant diseases
(breast cancer, uterine cervical cancer, colonic and rectal cancers), mental
diseases and disorders (including alcoholism, schizophrenia, post-traumatic
stress disorder (PTSD), depression, and senile and presenile psychoses),
acute infectious diseases (TB and AIDS), and injuries.
The Programme includes primary, secondary and tertiary prevention
measures, centring on not only health promotion with the objective of improving
the health of the population, but also on simultaneously reducing the prevalence
of risk factors for individual diseases. Combined with these measures is care
for the maintenance of the quality of life of patients, i.e. combining preventive
health care interventions with curative ones, and orienting the latter towards
maintaining (and improving) quality of life.
•
•

52
Health systems in transition Croatia
There is a list of strategic documents and programmes adopted and/or
conducted on governmental, cross-governmental and intersectoral levels, having
strategic value in creating the conditions for good health and health promotion.
These include: Health Promotion and Disease Prevention Act (in the preparatory
stage); National Programme for Prevention of Cardiovascular Diseases; National
Programme Acting for Youth; National Plan for Activities Aimed at Protecting
the Rights and Interests of Children (2006–2012); Croatian Food and Nutrition
policy; National Programme for Prevention of Cardiovascular Diseases;
Croatian Food Guidelines; Croatian Food Guidelines for Children (still under
development); National Programme for Control of AIDS; National Strategy
for Prevention and Control of Psychoactive Drug Abuse (2006–2012); Traffic
Safety Programme; National Programme for Roma;* First Croatian Health
Project;* Second Croatian Health Project; National Cancer Prevention and
Early Detection Programme* (in the preparatory stage); Health Development
Strategy of the Republic of Croatia (in the process of enacting); Croatian Alcohol
Action Plan; and Croatian Tobacco Action Plan.9
The Network of Public Health Institutes
Croatia has accepted the modern concept of health promotion, which intends
to improve the level of public health by tackling health determinants and not
just preventing disease. Unlike the preventive procedures, which are mainly
targeted at the highest risk population groups and individuals, health promotion
is aimed at the entire population. The HZJZ takes a leading role, along with
21 county public health institutes, and together they form the Network of
Public Health Institutes. Health promotion and disease prevention is divided
into the following units: health promotion; social medicine; school health; drug
prevention; epidemiology of chronic noncommunicable diseases; epidemiology
of communicable diseases; and environmental health. In 2003, the Network of
Health Promoters was established as part of the CroCan Project between the
Canadian Society for International Health, the Croatian Ministry of Health, the
HZJZ and the Andrija Stampar School of Public Health.
Many activities have been initiated by the National Public Health Institute
and spread throughout the country via the Network of Public Health Institutes,
such as:
activities for World Health Day, World No Tobacco Day, World Heart Day,
World Diabetes Day, Quit & Win Campaign, etc., in collaboration with
professionals and experts in the fields of health production and facilitating
•
9 Programmes indicated with * are discussed in detail in the subsection Specific projects for health promotion
and disease prevention.

53
CroatiaHealth systems in transition
the distribution of educational packages, CDs, educational seminars, and
promoting materials on these topics;
education and training of professionals who work in schools and in centres
for drug prevention.
Additionally, the National Public Health Institute has developed two
interactive web sites:
http://www.zdravlje.hr/ aimed at the public, to provide health information
across a broad range of subjects, with question and answer facilities;
http://www.hzjz.hr/ aimed mainly at health professionals.
Specific projects for health promotion and disease prevention
First Croatian Health Project; health promotion
Initiated in 1995, this project was the starting point for a health promotion
programme in Croatia. It was led by the Ministry of Health and the HZZO, and
supported by the World Bank. The aim of the project was to promote healthier
lifestyles (nonsmoking, proper diet, regular physical activity and responsible
sexual behaviour) and to establish baseline parameters for health promotion
programme development.
Organized by the HZJZ, the project began with a nationwide survey of adult
lifestyle habits and attitudes, anthropometric measurements and laboratory tests,
and secondary school lifestyle habits and attitudes. It was followed by training
in health promotion predominantly for individuals in public health, primary care
and the education sectors. A large media campaign was run in parallel, including
TV and radio coverage, and advertisements though newspapers, leaflets, posters,
billboards, educational brochures and promotional events.
School health
Until 1998, school health services were responsible for comprehensive (curative
and preventive) health care. Since the reforms in 1998, exclusively preventive
health care measures for school children, youths and university students have
been provided by school health services, while GPs are responsible for illness
among children and youths.
School health services are part of a network that reaches even the most remote
areas of Croatia and performs the following tasks: systematic examinations;
work with school staff and parents; health education and health promotion;
counselling (guidance) service; health care for students with developmental
disorders; immunization according to the national mandatory immunization
schedule; care of the school environment; collaboration with others involved
•
•
•

54
Health systems in transition Croatia
(family physician/GP, other health services, local community and social welfare
service); and additional multidisciplinary projects. The principles of health
promotion are included in many of these activities, as educators are trained
and involved in national and local initiatives.
A cooperation programme has been initiated between Flanders and Croatia,
entitled the “implementation of a methodology for the development of evidence-
based guidelines in school health care”. The project partners in Flanders are
the Katholieke Universiteit Leuven, Department of Youth Health Care and the
Flemish Society for Youth Health Care; and in Croatia, the Society for School
and University Medicine, the HZJZ and the University of Zagreb, Department
of Social Medicine. The expected outcomes after two years are: the creation
of a methodology for guideline development, adapted to local possibilities
and constraints; increasing the capacity of the Croatian Society for School
and University Medicine to act as a coordinator for the development and
implementation of guidelines for School Health Care in Croatia in the future;
and developing a model for European guidelines for School Health Care.
National Programme for Prevention and Early Detection of Cancer
A comprehensive National Programme for Prevention and Early Detection
of Cancer is still under development. Nevertheless, a Health Care Measure
Plan and Programme from the social health insurance plan was passed at
the beginning of 2002 (for a two-year period) by the Minister of Health in
compliance with the Health Insurance Act. It envisages general oncological
care measures against malignant diseases. This covers population education on
cancer prevention methods (from school age onwards) following the European
Codex against Cancer, as well as measures for primary prevention, detection
and early diagnosis of breast cancer, uterine cervical cancer, and colonic cancer.
Tertiary prevention measures are also included, e.g. education and emotional
support for women that have undergone a mastectomy and health education
for individuals having undergone a colostomy.
Under this programme, the General/Family Medicine Service must ensure
health promotion, health education and health awareness of the population,
taking care of high-risk individuals, encouraging self-protective and mutual
protection activities, carrying out preventive medical check-ups and continuous
patient care, and maintaining patient registries. School health services,
positioned in public health institutes, provide systematic examinations,
health education and individual guidance for school children and students,
covering risk behaviour, sexually transmitted diseases, breast and testicle self-
examination, and securing regular visits to gynaecologists for sexually active
individuals. In primary care, gynaecologists take part in health education and

55
CroatiaHealth systems in transition
training programmes for the prevention of sexually transmitted diseases, genital
organ cancers, health education, early detection of breast cancer and cervical
carcinoma, early detection of choriocarcinoma, ovarian carcinoma, and early
detection and treatment of pre-cancerous vulvar and vaginal changes.
Since 2005, the Programme for Prevention and Early Detection of Cancer
has been developed in Croatia, particularly for breast cancer. The Senological
Society of the Croatian Medical Association runs the “Mobile Mammography”
project. The initial proposals and recommendations for the (primary) prevention
of cancer have fully taken account of the recommendations by the European
Code against Cancer and Scientific Justification (third version, 2003).
National Programme for Roma
The National Programme for Roma (2003) has been prepared in order to apply
a multidisciplinary and systematic approach to address the problems of the
Roma population in all fields, according to recommendations from the Council
of Europe and the EU. The Programme is based on the provisions contained in
international documents on human rights and the rights of national minorities
to which the Republic of Croatia is a party. The experience of other countries
that are addressing the challenges of Roma in a systematic manner has been
taken into account. The Roma population themselves have participated and
contributed in the creation of the Programme.
The National Programme for Roma defines the following priorities: health
survey, health education, vaccination of Roma children, improved community
nursing, fight against alcoholism, smoking and other addictions, and monitoring
of Roma population’s access to and use of health care.
Beyond health care, the National Programme for Roma encompasses
complementary projects from different areas such as inclusion of Roma in
social and political life, preservation of traditional culture, legal aid and
the fight against discrimination, education, employment, social welfare and
protection.
The purpose of the health care project is to support the programme
for improvement of the health status and health care of Roma, thereby
reducing health inequalities among the Roma population in Croatia. For the
implementation of this Programme, five target counties in central and eastern
Croatia were selected (Međimurska, Varaždinska, Osječko-baranjska, Sisačko-
moslavačka and Grad Zagreb) because of the large number of Roma living in
these counties.

56
Health systems in transition Croatia
Health Promoting Schools Programme
Since 1993, Croatia has been part of the European Network of Health Promoting
Schools (ENHPS). At national level, the Programme seeks to build health
promoting policy in schools, with plans to allocate school health services
in the areas of policy implementation and development. At school level, the
Programme supports schools in building health promotion approaches at the
physical, emotional, social and learning levels, by offering individual approaches
when needed through school health counselling services.
The HZJZ is the national coordinator hosting institution. The Ministry
of Health and Social Welfare and the Ministry of Science, Education and
Sport signed the agreement for Croatia to become a member of the ENHPS,
with responsible individuals named in both ministries. Also involved in the
Programme are experts from the Andrija Stampar School of Public Health,
Zagreb Medical School, University of Zagreb. From 1996 to 2000, the United
Nations Children’s Fund (UNICEF) Croatian Office provided support to
the Network. A pilot project, “Twin schools”, involved the pairing of local
institutions, e.g. the Zagreb City Office for Health, Work and Social Welfare
and the City Office for Education in 2001, supported by the Network of Health
Promoting Schools Programme, city of Zagreb.
Maternal and child health/breastfeeding
In 1989, recognizing the benefits of breastfeeding, UNICEF and the WHO
introduced a worldwide programme for breastfeeding promotion known as
“Ten steps to successful breastfeeding”, which also included the Baby-Friendly
Hospital Initiative (UNICEF, 1991). The programme was initiated as a response
to decreasing rates of breastfeeding and to the expansion of commercial milk
supplements and their aggressive advertising. This programme was launched
in Croatia in 1993. By 2000, through concentrated efforts, 15 of a total of 32
maternity hospitals have been accredited as “baby-friendly hospitals”. Hospitals
are awarded baby-friendly status when standard procedures in maternity wards
are brought in line with WHO/UNICEF breastfeeding recommendations. Since
1998, “Happy baby” parcels with supplies for neonates have been handed out to
new mothers. At the beginning of 2006, UNICEF reintroduced this programme,
to which some government measures have also contributed. The National Action
Plan for Children’s Rights and Interests 2006–2012 was adopted on 22 March
2006 following these recommendations.
Public health research, public health data collection and other projects
Croatia has a long tradition and a highly developed system for the collection,
processing and analysis of public health data. Apart from routine studies, the

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CroatiaHealth systems in transition
HZJZ conducts special studies, some of which are carried out in collaboration
with WHO. These include:
World Health Survey – WHS (WHO, Geneva);
European Health Interview Survey – EUROHIS (WHO, Copenhagen);
European School Survey Project on Alcohol and Other Drugs – ESPAD
(Council of Europe);
Health Behaviour in School-Aged Children (WHO, Copenhagen);
Global Youth Tobacco Survey – GYTS (WHO, Copenhagen; CDC-Atlanta,
United States).
The other health promotional and preventive projects in Croatia are Healthy
Cities (since 1992), the Countrywide Integrated Noncommunicable Disease
Intervention (CINDI) project (since 1992), and Health Promoting Schools (since
1993), as well as several smaller projects within the framework of biannual
agreements with the WHO Regional Office for Europe. Two of the largest
campaigns were “Say YES to NO-smoking“ and the promotional event “The Big
Breakfast”, both organized by the Andrija Stampar School of Public Health.
Sustaining the environment to safeguard quality of life
Within the HZJZ there is a Department of Environmental Health that addresses
aspects of health and quality of life, which are closely related to the environment.
This Department acts at national level and coordinates the network of county
institutes of public health and their ecology outposts. Some aspects are addressed
through interdisciplinary collaboration with other science- and environment-
related departments, such as the Ministry of Health and Social Welfare, the
School of Medicine, the Institute for Environmental Protection, and the
Ministry of Agriculture, Forestry and Water Management. The Department of
Environmental Health is made up of several units, which are responsible for
drinking water, food safety, safety of objects of common use, toxicology, and
more.
The Ministry of Health coordinated the development of the National
Environment and Health Action Plan (Ministry of Health, 1999), which the
National Health Council adopted in May 1999. The plan contains sections on
water quality, air quality, waste management and food safety (WHO Regional
Office for Europe, 2000).
Drinking water
The public drinking water supply system covers 77% of the total population;
however, there are significant regional differences in coverage. In some rural
parts of the country and in some islands, less than 50% of the population has
•
•
•
•
•

58
Health systems in transition Croatia
access to the public water supply. Those without access get their drinking
water from wells of 10–100 m in depth. The surveillance of drinking water
has shown that less than 10% of samples from the public water supply do not
meet the standards, and approximately one third of samples from the wells
were contaminated microbiologically (HZJZ, 2005).
Food safety
Food safety is one of the most important aspects of safeguarding health,
working ability and quality of life. The Sanitary and Veterinary Inspection
controls production, importation and distribution of food products by taking
samples and sending them for analysis to the laboratories authorized by the
Ministry of Health. They conduct analyses of food products within the Food
Safety Monitoring Programme. Every year the laboratories at the Department of
Environmental Health conduct over 40 000 analyses of food products; however,
the standards are not met by 10% of samples. There are also laboratories
outside of the health system, such as the Veterinary Institute and the Nutritional
Technological Institute. The most common reasons for not meeting the standards
are microbiological contamination, the amount of additives, and incorrect and
irregular labelling.
Air quality
The routine assessment of air quality is conducted with reference to the
recommended limit values, which are equal or close to the WHO Air Quality
Guideline values. In most locations, the air pollution levels have been below the
reference values since 1995. The exceptions are mostly the mass of sediment
dust, or the amount of cadmium or lead in the sediment dust, which were higher
than the national recommended levels in several cities. However, there are no
data on the concentration of metals in suspended particulate matter and it is
difficult to assess the health significance of these findings.
Noise monitoring
Currently, there is no regulation regarding a noise monitoring system and
evaluation of noise effects on the environment in Croatia. Therefore, there are
no systematic data on noise available. Measurements and evaluations of noise
are performed in cases of citizens’ complaints. If citizens’ complaints can be
taken as an indicator of noise effects on the environment, then it is worth noting
that the most complaints are made with regards to loud traffic and loud clubs
and bars. In 2003, a new law, based on European guidelines on noise, was

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CroatiaHealth systems in transition
adopted, but regulation regarding a noise monitoring system and evaluation of
noise effects on the environment is still in progress.
Environment
The lack of an integrated waste management system is an environmental
problem and also a potential source of health risks. Data on population exposure
to hazardous chemicals are scarce. The war in the early 1990s left behind a
specific environmental health hazard in the form of land mines. According to
the Croatian Centre for Human De-mining, less than 5% of Croatia’s surface
may still have mines (1150 km2).
4.2 Primary health care
According to the Croatian Health Care Law, the two main roles to be fulfilled
by primary health care are: being the foundation of the health care system,
and gatekeeping. Primary health care is organized as a network of first-contact
doctors. Each insured citizen is required to sign up with a specific GP.
Primary health care is delivered through a network of individual offices, larger
units comprising several offices (some including small laboratories), and health
centres that provide general medical consultations, primary care gynaecology
services, care for pre-school children, school medicine, occupational health
services and dental care.
The 1993 health reform set the stage for the disintegration of health centres
and the privatization of individual offices. Currently, most of primary health
care is provided through private practices comprising a team of a doctor and
a nurse, financed by capitation. Most of the health centres that were exclusive
providers of primary health care with salaried employees prior to the reform
currently represent administrative bodies that lease offices and (depending on
the availability of equipment) provide emergency medical care, laboratory
services and radiological diagnostics. Presently over 80% of private practices
in primary health care operate in leased facilities.
Primary health care is organized around several medical specialties but
is gradually moving towards a family physician system. All GPs currently
practising in primary care are required to specialize in family medicine by
2015 (Katic et al., 2004).
Primary health care comprises the following services:
general practice/family medicine•

60
Health systems in transition Croatia
dental care
infant and pre-school child care
primary care gynaecology
community nursing and home care services
emergency medical care
public health services (hygiene, epidemiology and school medicine)
occupational health services.
General practice/family medicine
General practice/family medicine treats patients of all ages and, as previously
discussed, will be transformed into a family medicine service. GPs are required
to treat patients in their offices, provide home visits and provide preventive
check-ups. Doctor and nurse teams are independent entrepreneurs owned by the
doctor and contracted by the HZZO. Each GP is expected to carry a minimum of
approximately 1700 people per year on a roster. This number is low compared
to the GP rosters of 2000–2500 people in most European countries. This
lower figure was established deliberately to encourage physicians to work in
underserved areas. As can be seen from Fig. 4.3, in 2001 Croatia had 0.7 GPs
per 1000 inhabitants. This is slightly lower than the 1 per 1000 EU average,
but remains higher than the respective number for most central and eastern
European countries.
In 2004, a total of 2391 doctors worked in general practice/family medicine.
Of these, 1008 were specialists (family medicine, school medicine, occupational
medicine and others), the rest were graduates of medical schools. In 2004,
general practice/family medicine offices provided 24.6 million consultations
(HZJZ, 2005). See section 5.3 on payment of primary care physicians.
Infant and pre-school child care
Infant and pre-school child care is delivered by teams consisting of a
paediatrician and a nurse that carry on average 1200 individuals per year on a
roster. Contracted by the HZZO, these teams provide prevention (vaccination)
and treatment services. Depending on the parents’ decision, they provide services
to children until the age of 6 years or 15 years, when they are taken over by
respective family physicians.
In 2004, a total of 260 paediatricians worked in primary health care and
provided 2.5 million consultations (HZJZ, 2005).
•
•
•
•
•
•
•

61
CroatiaHealth systems in transition
Fig. 4.3 Number of GPs per 100 000 population, 2004 or latest available year
42.9
46.3
55.1
55.7
55.9
56.0
63.6
64.0
64.1
65.1
65.5
68.0
68.0
68.9
70.5
71.0
71.1
71.9
72.6
72.9
77.9
81.5
82.7
90.7
94.6
98.9
102.4
102.6
125.5
135.1
143.8
165.4
166.5
53.2
52.3
50.6
47.2
40.2
32.1
30.4
30.2
24.6
24.3
22.1
20.6
20.4
18.0
14.5
11.4
83.0
64.2
85.4
0 50 100 150 200
Source: WHO Regional Office for Europe, 2006.
Finland (2003)
France
Austria
Belgium (2001)
Greece (1990)
EU Member States before May 2004 (2003)
Germany
EU average (2003)
Italy (2003)
Luxembourg
The former Yugoslav Republic of Macedonia (2003)
Lithuania
Malta (1998)
Romania (1998)
Iceland
Turkey (2003)
Estonia (2003)
Czech Republic
Republic of Moldova
Denmark (2003)
Israel (2003)
Bulgaria
Ireland
Croatia
Hungary
United Kingdom (2003)
EU Member States joining EU May 2004
Norway
Switzerland
Turkmenistan (1997)
Portugal (2003)
Sweden
Armenia
Serbia and Montenegro
Latvia
Albania (2003)
Netherlands (2003)
Kyrgyzstan
Slovenia (2003)
Slovakia
Andorra
Monaco (1995)
Belarus
Ukraine
CIS average
Georgia
Russian Federation
Tajikistan
Bosnia and Herzegovina
Azerbaijan (2003)
Uzbekistan
Kazakhstan

62
Health systems in transition Croatia
Oral health
Dental services are provided by teams consisting of a dentist and a nurse,
contracted by the HZZO or working privately without HZZO contracts. They
provide preventive and curative services. On average, contracted teams carry
2500 people per year on a roster. They are organized in the same manner as
general practice offices. Apart from dental practices, the dental care system
includes dental and prosthetic laboratories, which operate as a part of a health
centre or individually. Private offices charge the cost of services directly to
patients.
In 2004, a total of 1930 HZZO contracted teams worked in primary oral
health. 257 dentists were specialists (paedodontics, orthodontics, etc.), the rest
were graduates of dental schools and HZZO contracted teams provided 4.7
million consultations, while private dentists reported 512 650 consultations
(HZJZ, 2005).
In 2005, Croatia had a total of 3164 dentists, of which 501 were self-
employed; 72 were employed by private institutions (larger dental clinics);
and 2591 worked in smaller clinics (public) and 1431 in private clinics not
controlled by HZZO.
Primary care gynaecology
Primary care gynaecology deals with the outpatient treatment of female
reproductive system disorders as well as prevention and maternity care. A team
(gynaecologist and nurse) carries 6000 women per year on a roster. They are
organized in the same manner as general practice offices. Their services are
covered by compulsory health insurance as additional care for women, separate
from existing general practice. In 2004, 213 teams worked full time and 39
part time (HZJZ, 2005).
Community nursing
The community nursing service provides health promotion and treatment at
home. It is delivered by nurses (graduates from nursing colleges) who cooperate
with GPs. In 2004, the average number of insured in care per community nurse
was 4892. The service is in the domain of health centres, and in 2004 it employed
870 nurses. Nursing priorities include chronically ill patients, pregnant women
and mothers with infants (HZJZ, 2005).

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Home care
Home care is organized through health centres or as an independent service in
public or private ownership. Home care services are mainly targeted at people
who cannot take care of themselves. The service comprises treatment, bathing,
feeding and nursing at home, when recommended by a primary health care
doctor. Costs of care are covered by health insurance based on contracts with
the HZZO. Apart from the services covered by health insurance, other services
can be rendered and charged for independently. In 2004, home care services
employed 968 nurses, each performing on average 2.068 home visits per year
(HZJZ, 2005).
Public health services and school medicine
Hygienic and epidemiological services and the school medicine service (since
1998) are under the jurisdiction of county institutes of public health. Their
activities are coordinated with primary health care centres. The school medicine
service implements regular medical examinations, vaccinations and health
education for school children. A team (school medicine specialist and nurse) is
in charge of 5000 primary and secondary school students. In 2004, the service
employed 153 teams (HZJZ, 2005).
Emergency medical care
Emergency medical care is organized at the country level, and in different ways:
additional work of doctors already operating in a certain area; individual services
established by health centres for a certain area; and centres for emergency
medical care, such as those operating in the four major cities – Zagreb, Split,
Rijeka and Osijek.
In 2004, emergency medical services had 442 permanently employed
physicians, and recorded 1 033 865 interventions. Except for medical care,
emergency services are also used for transportation (HZJZ, 2005).
Occupational health service
At primary health care level, occupational health in Croatia is provided either
through health centres, practices leased by health centres or through private
practices.
In a health centre, the occupational health team is composed of an
occupational medicine specialist, a nurse with secondary or post-secondary
education and a psychologist. The psychologist, and potentially other specialists

64
Health systems in transition Croatia
(ophthalmologist, psychiatrist, neurologist and otorhinolaryngologist), are
contractual employees in private occupational health practices. The 151 full-time
and 16 part-time occupational health teams in 2004 employed 161 occupational
health specialists.
The number of examinations performed under occupational health services
was 126.7 per 1000 in 2004. It is estimated that fewer than half of the average
number of employed workers regularly utilize one of the forms of occupational
health care (HZJZ, 2005).
4.3 Secondary and tertiary care
4.3.1 Secondary and tertiary outpatient health care
Secondary and tertiary outpatient health care in Croatia represents outpatient
specialist care. It is provided through consultations for primary health care
physicians, specific diagnostic treatments or curative medical treatments
(diagnostic procedures, treatment and rehabilitation).
Services may either be provided privately or publicly, in which case providers
have to enter into contracts with the HZZO and the uptake of patients is based
on referrals from physicians practising in primary health care. Secondary
outpatient health care services are mostly delivered through hospitals. Some
units are located in polyclinics or single practices. In 2004, there were 7.6 million
examinations performed though outpatient specialist care (HZJZ, 2005).
4.3.2 Secondary and tertiary hospital care
Infrastructure
Secondary care facilities include hospitals, polyclinics and sanatoria. Hospitals
are divided into general hospitals and special hospitals. All general and the
majority of special hospitals are public county-owned. While general hospitals
primarily serve the population of their respective county, special hospitals serve
the entire population of Croatia. General hospitals have facilities for obstetrics
and gynaecology, internal medicine, surgery and inpatient paediatric care.
Other departments are optional, depending on need and the vicinity of another
hospital or polyclinic offering those services. Special hospitals are organized
around specific diseases, chronic illnesses or population groups. In addition
to inpatient facilities, hospitals also have outpatient departments providing
ambulatory services. Croatia has a number of sanatoria (spas) and medicinal

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CroatiaHealth systems in transition
mud baths, which provide prevention, treatment and rehabilitation services
through the use of natural mineral springs. A number of sanatoria are registered
as special hospitals, owing to the additional health services they provide. Most
offer tourist services, generating additional income.
Polyclinics provide outpatient specialist consultations and diagnostic and
rehabilitation services. Most public polyclinics are linked to general and clinical
hospitals. Others include private polyclinics and privatized specialist practices
in health centres.
Tertiary care is provided in state-owned facilities: clinical hospitals and
clinical hospital centres. Besides providing care (the most complex activities
in a specific branch of medicine), they also engage in medical education and
research. Clinical hospitals are general hospitals with at least four specialties
at the teaching hospital level. Clinical hospital centres are general hospitals in
which more than half of the units are at the teaching hospital level, and which
carry out university education in over half of the teaching programmes for
faculties of medicine, dentistry, pharmacy and biochemistry.
The Minister of Health determines which institutions are classified as clinics,
clinical hospitals and clinical hospital centres according to the Health Care Law
that specifies the criteria that hospitals have to attain in order to be granted
special status (e.g. clinical hospitals, clinical hospital centres). The National
Health Council accredits hospitals that meet certain normative standards set
by the medical associations.
Secondary and tertiary care providers are integrated into the public health
insurance system with the HZZO as the paying agent. Prior to receiving
secondary or tertiary care, patients are required to obtain referrals from their
respective GPs. In case of a medical emergency, patients are admitted directly
to the hospital, thus bypassing the gatekeeping system. Private providers, such
as private polyclinics not contracted by the HZZO, charge for their services
directly and/or contract with private insurers offering supplementary health
insurance.
The current organization of the Croatian system of hospitals suffers from
several challenges. First, the counties (since 1993 owners of institutions
offering primary and secondary health care) have neither the legislative nor
the organizational capabilities required for the successful management of
institutions that were trusted to them. Second, as almost all of the hospitals in
the four biggest cities in Croatia (Zagreb, Split, Rijeka and Osijek) possess the
status of clinical hospitals, the people living in those cities (almost 50% of the
entire population) are left without local general hospitals that would provide
them with secondary health care. Instead, they are usually referred directly to
locally available tertiary care providers.

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Health systems in transition Croatia
With regard to the geographic distribution of health care institutions and
providers, basic supply-side indicators, such as number of beds and doctors per
1000 inhabitants and number of patients treated per 1000 inhabitants, reveal
significant variations between individual Croatian counties. These differences
may have been caused by a long history of unsystematic resource allocation
between the counties, which has so far been primarily based on historic
arguments, rather than analyses of regional needs.
Furthermore, analyses of the teritorrial distribution of health care institutions
indicate that large disparities exist in regional geographic access to hospitals.
For example, over 140 000 inhabitants of southern Dalmatia have to travel long
distances to reach the nearest hospital (by air this distance is 40 km) (Ministry
of Health, 2006).
In 2004, Croatia had two clinical hospital centres, five clinical hospitals,
seven clinics, 22 general hospitals, 29 special hospitals, seven health resorts,
four emergency care stations, 278 polyclinics and 145 nursing care institutions
(HZJZ, 2005).
Secondary care provision
The population ratio of acute hospital beds in Croatia is closer to the western
European average than the central and eastern European average (see Table
4.1).
When contracting with secondary and tertiary health care providers, the
HZZO sets a variety of target standards and norms, such as average length of
stay for hospital care for different specialties. These have been used, combined
with financial incentives, to reduce average length of stay from 14.5 days in 1993
to 8.2 days in 2004. The concurrent rise in occupancy rates suggest productivity
has improved. Nonetheless, the length of stay is still somewhat longer than the
EU average (see Table 4.1).
4.4 Social care
4.4.1 Historical background
Social welfare policy was introduced for the first time in 1922 when legislation
was enacted to provide for old age, disability and survivors. Modern Croatia
inherited its social welfare system from the former Socialist Republic of
Yugoslavia. However, soon after the declaration of independence, it became
obvious that the system was in need of restructuring as it was not capable of

67
CroatiaHealth systems in transition
Table 4.1 Inpatient utilization and performance in acute hospitals in the WHO European
Region, 2004 or latest available year
Hospital beds
per 1000
population
Admissions per
100 population
Average length
of stay in days
Occupancy
rate (%)
Western Europe
Andorra 2.1 10.0 6.7e70.0e
Austria 6.0a28.8a6.4a76.2a
Belgium 4.8 16.9e8.3a65.9a
Cyprus 4.0a8.1a5.5a72.8a
Denmark 3.2a17.8c3.6a84.0c
Finland 2.2 19.9 4.2 74.0i
France 3.8a16.6d6.1a84.0a
Germany 6.4 20.4 8.7 75.5
Greece 3.8g14.5f 6.4f 66.6f
Iceland 3.7h14.7a3.6a–
Ireland 2.9 14.1 6.5 85.4
Israel 2.1 17.3 4.2 98.0
Italy 3.6a15.2b6.8b76.9b
Luxembourg 5.5a18.4j7.7f74.3j
Malta 3.0 10.7 4.6 85.4
Monaco 15.5i– – –
Netherlands 3.1b8.8c7.4c58.4c
Norway 3.1 17.3 5.2 86.4
Portugal 3.1a11.2e8.2e85.2a
Spain 2.8b11.7b7.0b78.2b
Sweden 2.2 15.1 6.1 77.5h
Switzerland 3.9a16.3f9.0a85.2a
Turkey 2.3 8.1a5.6a64.9
United Kingdom 2.4f21.4h5.0h80.8f
Central and south-eastern Europe
Albania 2.7 – – –
Bosnia and Herzegovina 3.3f7.2f9.8f62.6e
Bulgaria 7.6h14.8h10.7h64.1h
Croatia 3.6 14.6 8.2 89.9
Czech Republic 6.2 20.8 8.2 74.8
Estonia 4.3 17.2 6.2 68.4
Hungary 5.9 23.5 6.5 76.6
Latvia 5.4 18.8 – –
Lithuania 6.1 21.9 7.9 77.4
Poland 4.7b– – –
Romania 4.4 – – –
Serbia and Montenegro – – 9.7b69.0b
Slovakia 6.1 17.8 8.4 68.6
Slovenia 3.9 16.6 6.2 73.2
The former Yugoslav Republic of Macedonia 3.4c8.2c8.0c53.7c
CIS
Armenia 3.9 7.0 8.5 41.8
Azerbaijan 7.6a4.8a15.8a26.1a
Belarus – – – 88.7j
Georgia 3.7 5.4 6.7 99.3
Kazakhstan 6.2 17.4 10.0 95.6
Kyrgyzstan 4.1 12.3a10.3 90.0
Republic of Moldova 5.2 15.4 7.8 62.9
Russian Federation 8.2 21.3 12.2 87.3
Tajikistan 5.7 10.2 12.0 58.1
Turkmenistan 3.8 13.3 7.9 81.8
Ukraine 7.1 20.0 11.9 91.2
Uzbekistan 4.5 14.2 – 86.5
EU average 4.2 17.5a6.9a77.5a
EU Member States before 1 May 2004 4.0a18.0c6.9a77.0c
EU Member States joining EU on 1 May 2004 5.2 20.6 7.4 73.8
CIS average 7.4 19.5 11.6 87.1
Source: WHO Regional Office for Europe, 2006.
Notes: a 2003; b 2002; c 2001; d 2000; e 1999; f 1998; g 1997; h 1996; i 1995; j 1994; CIS: Commonwealth of Independent States;
EU: European Union.

68
Health systems in transition Croatia
handling the massive inflow of refugees, the uprooting of the population and
the heavy casualties caused by the war of independence. Initially, government
policy focused on meeting the basic survival requirements of refugees and others
through cash grants and aid in kind. The 1997 Social Security Law marked the
transition from a war-centred system to a system that gradually moved towards
focusing on long-term housing services, various welfare institutions such as old
people’s homes, geriatric centres, community welfare centres, day care centres
and financial assistance.
4.4.2 Specific benefits and policies
Ageing
Citizens over 65 years accounted for 16.1% of the total population in 2002. As
shown in Fig. 4.4 and Fig. 4.5, owing to long-standing decreases in birth rate,
and increasing life expectancy, the Croatian population is ageing. The economic
transition and massive damage caused by the war have had a particular impact
on the welfare of the elderly. Older people live mostly in their homes and with
their families. Only 2% of the total population over 65 years have been placed
in institutions. In 2001, Croatia had 64 public homes for older and infirm people
and over 50 homes in the private sector. Since the capacities of accommodation
in such institutions were, and still are, insufficient, social care policy for the
elderly has focused on non-institutional forms of care.
In addition to institutional care, homes for older and infirm people organize
the provision of services and assistance within the local community. Centres for
assistance and care are being established within the county offices for labour,
health and social welfare. In addition, older and infirm individuals are being
been placed with foster families. The use of a model of providing services in
day care centres, which enable the elderly to go on living in their own houses or
Fig. 4.4 Population pyramids, 2000 and 2030
Source: U.S. Census Bureau, 2007.

69
CroatiaHealth systems in transition
with their own families, is encouraged. Furthermore, in the care of the elderly,
an increasingly important role is being played by the nongovernmental sector,
which developed with the beginning of the war in Croatia, when the state-run
systems of welfare and health care could no longer bear the burden of new
welfare problems.
The basic principle of the development of the social welfare system in the
care for the elderly and infirm rests upon decentralization and privatization.
Legislation relating to the social welfare system provides for a legal and
institutional framework within which the system is supposed to become
gradually decentralized in financial and organizational terms.
Housing
Housing conditions affect people’s health and well-being but the health situation
of homeless people is especially critical. They often suffer from health problems
typically associated with poverty, including malnutrition, infectious diseases
and psychosocial stress caused by solitude and insecurity. Nevertheless, there
are no reliable data on homelessness in Croatia.
The war forced over 700 000 people to leave their homes and become
refugees. Approximately 200 000 buildings, mainly residential, were razed or
damaged. In the meantime, many of the buildings were either reconstructed or
Fig. 4.5 Population forecast in thousands, 2000–2030
Source: United Nations, 2006.
4 100
4 150
4 200
4 250
4 300
4 350
4 400
4 450
4 500
4 550
4 600
2000 2005 2010 2015 2020 2025 2030

70
Health systems in transition Croatia
are currently under reconstruction. A variety of programmes targeted at young
people, war veterans and other groups, such as government housing and long-
term loans for housing construction, are currently being implemented.
Old age, disability and survivors
The Ministry of Labour, the Ministry of Health and Social Welfare and the
Ministry of Finance supervise the organization and function of the regular
and basic pension systems and the individual accounts. The Croatian Pension
Insurance Institute administers the respective benefits. The Central Registry,
pension companies and pension insurance companies provide general
administration services and administer benefits with regard to individual
accounts (Social Security Online, 2005).
Sickness and maternity
The Ministry of Health supervises the organization and function of the sickness
and maternity benefits system. The HZZO with its 21 district offices administers
the respective benefits. There is no minimum qualifying period to be eligible as
a beneficiary. Entitlement to cash sickness benefit is determined by a designated
doctor in a primary health care institution.
Unemployment
The Croatian Employment Institute administers the unemployment benefits
programme through its central office and 22 regional and 93 local offices.
Family allowance
The Ministry of Health and Social Welfare supervises the organization and
function of the family allowance system. The State Institute for the Protection of
Family, Maternity and Youth provides legal supervision. The Croatian Pension
Insurance Institute administers the family allowance programme.
Voluntary organizations
Social voluntary organizations play an important role in almost every field
of social welfare in Croatia. In general, NGOs command a growing number
of assets and mobilize large numbers of human resources, both salaried and
volunteer workers. Very few NGOs, however, can be characterized as financially
solvent. As a result, an increasing number of NGOs depend to a large extent
on national funding (CERANEO, 1999). Funding cvomes from the Ministry
of Health, the State Office for Civil Society, as well as foreign donors and
private companies.

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CroatiaHealth systems in transition
4.5 Mental health
The prevalence of mental health problems is growing in Croatia as it is in the
EU. In 2004, one out of every four days of hospital treatment in Croatia was
used to deal with mental health problems. Of these, 38.4% were for the treatment
of schizophrenia (Central Bureau of Statistics, 2004).
4.5.1 Mental health care organization and delivery
The primary health care service in Croatia, which consisted of general practice
and infant and pre-school child care in 2004, was provided by 2657 teams. These
cooperate with the psychiatric service, school medicine and centres for drug
abuse prevention within the 20 county public health institutes, local centres
for social work and educational institutions. In the mental health service, 358
psychiatrists and 75 neuropsychiatrists were employed in 2004, providing
outpatient and inpatient care for the population (HZJZ, 2004b). In 2004, there
were 361 529 mental disorder diagnoses registered in primary care, and 457
774 consultations were provided by outpatient psychiatric services. The number
of discharges for mental disorders was 41 214, representing 7% of all hospital
discharges.
Reports from 2004 show that there were 0.19 psychiatric beds per 1000
population in general hospitals, with an average length of stay of 14.9 days. In
addition, there were 0.75 hospital beds per 1000 in hospitals providing services
for chronic psychiatric patients, where the average length of stay was 70.1 days.
Bed utilization in psychiatric wards was among the highest of all hospital units,
reaching the 100% level.
Between 1997 and 2004, there was a decrease of 10.6% in the total number
of hospital beds. The decrease in psychiatric beds was even higher, amounting
to 11.4%.
4.5.2 Intersectoral cooperation
Several government bodies have been formed, some of them permanent and
others temporary, to improve a particular service or activity for those with mental
disorders. More recently, a State Commission has been established to monitor
the care of people with mental disorders. It includes representatives of different
government bodies, including the health and social welfare authorities, legal
experts and other professionals dealing with ethics and public relations. One
of the tasks of this Commission is to encourage the implementation of mental
health promotion programmes.

72
Health systems in transition Croatia
In 1999, the Ministry of Health formed a special body to develop
improvements in community-based psychiatry. The Croatian Association of
Psychiatrists has also elaborated a related draft framework. Several mental
health programmes have been considered for further development, including:
decreasing the stigmatization of chronic psychiatric patients, particularly of
those suffering from schizophrenia; the prevention of depression and reduction
of suicide rates; and the deinstitutionalization of long-stay patients.
According to the Health Care Law (2003) the Croatian Mental Health
Institute was founded and within the framework of the SEE Health Network
Mental Health Project, the first Community Mental Centre was established in
the health centre for Zagreb-West.
The Commission for Narcotics is a permanent government body, comprising
representatives of all authorities responsible for dealing with drug abuse,
including the health, education and social welfare authorities. A strategy on
prevention of drug abuse has been accepted by the Croatian Parliament and
is currently being implemented. The Governmental Office for Drug Abuse
Prevention and Centres for Drug Abuse Prevention in the 20 county public
health institutes have been established.
Several other commissions, with more global tasks, have been formed to
examine the possibilities of improvement in the quality of life of particular
population groups, such as children and the elderly. In view of the high incidence
of war-related psychological trauma, a Council of Experts was formed to
propose, elaborate and implement psychosocial programmes for war victims.
In 1999, a joint committee between the health and social welfare authorities
was formed to, among other tasks, improve social care in the community
for discharged psychiatric patients as well as health care for those chronic
psychiatric patients who are residents in social institutions.
4.5.3 Mental health legislation
The Law on Protection of Persons with Mental Disorders was approved by the
Croatian Parliament in 1997, with some revisions in 2000. This Law defines the
rights of these people to protection and care. It also specifies the conditions in
which these rights can be limited, elaborates the obligatory procedures related
to these limitations, and defines the right to protection from mistreatment. In
the original text of the Law, written consent was required from any person
admitted in a psychiatric hospital. Compulsory hospitalization was subject to
court supervision (Kozumplik et al., 2003).

73
CroatiaHealth systems in transition
In December 1999, the necessity for written consent was abolished.
Furthermore, the period in which the hospital was obliged to inform the court
of an involuntarily admitted person was prolonged from 12 to 72 hours.
Under this Law, in 2000 a State Commission for the protection of persons
with mental disorders was also established. Its responsibilities are to elaborate
on possibilities of further improvements in the status of people with mental
disorders, to deal with complaints from psychiatric patients, and to define mental
health promotion programmes. Additionally, in 2004, a Law on the Protection
of Patients’ Rights was approved by the Parliament.
4.6 Human resources and training
4.6.1 Physicians
The number of active physicians in Croatia has been rising, from a total of 10
110 in 1996 to 11 093 in 2004. The rate of physicians per 1000 population has
risen slightly over this period, from 2.2 per 1000 in 1996 to 2.5 per 1000 in
2004. However, Croatia is still well below the EU average of 3.5 physicians
per 1000 (HZJZ, 2005; WHO European Office for Europe, 2006).
Recently, Croatia has experienced a continuous decrease in the number of
candidates interested in pursuing medical education. The number of medical
graduates has fallen from 629 in 1996 to 410 in 2003.
4.6.2 Nurses
The number of nurses in Croatia has been rising, from 19 878 in 1996 to 22 799
in 2004. The rate of nurses per 1000 population has risen slightly over a period
of eight years, from 4.4 per 1000 in 1996 to 5.1 per 1000 in 2004. In 2004,
Croatia was well below the EU average of 7.3 nurses per 1000 (see Fig. 4.6).
All public sector nurses are registered. Croatia has a professional chamber of
nursing, a nursing association and a system of registration for nurse certificates.
There is also a Chief Nurse post in the Ministry of Health.
4.6.3 Dentists
The number of dentists in Croatia has risen substantially over a period of eight
years, from a total of 2769 in 1996 to 3193 in 2004, an increase of 13.3%. In
2004, of the 3193 dentists registered, only 523 were employed in publicly owned

74
Health systems in transition Croatia
Fig. 4.6 Nursing staff per 100 000 population, 2004 or latest available year
447
468
519
530
599
601
603
618
625
651
662
702
704
718
723
725
726
731
746
763
768
777
785
853
862
924
946
994
1017
1174
1341
1400
1476
1621
1881
514
509
508
475
432
426
419
406
401
383
367
356
343
290
255
248
799
633
830
0 500 1000 1500 2000
Ireland
Monaco (1995)
Norway
Netherlands
Belgium
Belarus
Sweden (2002)
Uzbekistan
Luxembourg
Iceland (2003)
Hungary
Czech Republic
Switzerland (2000)
Russian Federation
CIS
Ukraine
Germany
Finland
Lithuania
EU average
France
EU Member States before May 2004 (2003)
Azerbaijan (2003)
Slovenia (2003)
Republic of Moldova
Denmark (2003)
Slovakia
Estonia (2003)
Kazakhstan
Kyrgyzstan
EU Member States joining EU May 2004
Serbia and Montenegro
Austria (2003)
Israel
Latvia
The former Yugoslav Republic of Macedonia (2001)
Croatia
Malta
San Marino (1990)
Poland (2003)
Turkmenistan
Tajikistan
Bosnia and Herzegovina
Cyprus (2003)
Portugal (2003)
Armenia
Romania
Bulgaria
Spain (2000)
Albania
Georgia
Andorra
Greece (1992)
Turkey (2003)
Source: WHO Regional Office for Europe, 2006.
Note: CIS: Commonwealth of Independent States.

75
CroatiaHealth systems in transition
institutions, the others practising in private practices (HZJZ, 2005). With a rate
of 71.9 dentists per 100 000 population (2004), Croatia was well above the EU
average of 62.5 per 100 000 population (see Fig. 4.7).
4.6.4 Pharmacists
The number of pharmacists in Croatia has risen substantially from 1845
in 1996 to 2414 in 2004, an increase of 24%. The rate of pharmacists per
100 000 population has risen slightly over a period of eight years, from 41 per
100 000 in 1996 to 54 per 100 000 in 2004. Croatia is below the EU average
of 78 pharmacists per 100 000 (see Fig. 4.8).
4.6.5 Training
There are four undergraduate medical schools in Croatia. They are situated
in Zagreb and the regional centres Osijek, Rijeka and Split. The degree is
completed over six years. Prior to practising, graduates must take a one-year
internship and pass the state exam. Further specialization takes place after
the internship. Since 2002, all physicians practising in general practice are
required to specialize in family medicine by 2010. This specialization takes
four years.
General practice and family medicine are taught during basic undergraduate
medical education in Croatia. Since the mid-1990s continuing medical education
(CME) activities have been rapidly expanding owing to the compulsory
relicensing process. It is essentially based on a collection of CME credit points
over a period of six years. In 2000, over 600 GPs participated in different CME
courses organized by the European Academy of Teachers in General Practice
(EURACT, 2001).
The professional chambers for medicine, pharmacy, dentistry, nursing and
medical biochemistry are responsible for promoting professionalism among
their members. The chambers are responsible for accrediting professionals,
who must also be re-accredited every seven years.
4.7 Pharmaceuticals
In 2005, the pharmaceuticals market was estimated to be worth £300–350
million (HRK 3.2–3.7 million, US$ 550–650 million) (UK Department of Trade
and Investment, 2005). Annual growth has slowed considerably in recent years,
from over 20% to approximately 5%.

76
Health systems in transition Croatia
Fig. 4.7 Dentists per 1000 population, 2004 or latest available year (in parentheses)
0.4
0.4
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.5
0.6
0.6
0.6
0.6
0.6
0.6
0.6
0.7
0.7
0.7
0.7
0.7
0.8
0.8
0.8
0.8
0.9
0.9
0.9
1.0
1.1
1.1
1.2
1.5
0.4
0.4
0.4
0.4
0.3
0.3
0.3
0.3
0.3
0.3
0.2
0.2
0.2
0.2
0.2
0.2
0.7
0.5
0.8
0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0
Sweden (1997)
Monaco (1995)
Greece (2001)
Israel
Iceland
Cyprus (2003)
Belgium
Finland
Bulgaria
Estonia (2003)
Denmark (2003)
Norway
Germany
Luxembourg
Croatia
France
Czech Republic
Lithuania
EU Member States before May 2004 (2003)
EU average
Italy (2002)
Andorra
Slovenia (2003)
Latvia
Ireland
The former Yugoslav Republic of Macedonia (2001)
Portugal (2003)
Hungary
Austria
Spain (2003)
Switzerland
Netherlands (2003)
Serbia and Montenegro (2002)
Belarus
Slovakia
Malta
United Kingdom (2001)
Albania (2003)
EU Member States joining EU May 2004
Ukraine
Republic of Moldova
Kazakhstan
Russian Federation
Georgia
Poland (2003)
Azerbaijan (2003)
Armenia
Turkey (2003)
Kyrgyzstan
Romania
Uzbekistan
Bosnia and Herzegovina
Turkmenistan
Tajikistan
per 1000 population
Source: WHO Regional Office for Europe, 2006.
Note: CIS: Commonwealth of Independent States.

77
CroatiaHealth systems in transition
Fig. 4.8 Pharmacists per 1000 population, 2004 or latest available year (in
parentheses)
0.20
0.20
0.35
0.41
0.49
0.49
0.50
0.51
0.52
0.56
0.57
0.58
0.58
0.59
0.60
0.60
0.61
0.61
0.66
0.67
0.68
0.77
0.78
0.83
0.85
0.91
0.95
0.96
0.97
1.08
1.12
1.45
1.55
2.09
2.18
0.34
0.29
0.24
0.22
0.19
0.15
0.15
0.12
0.10
0.09
0.08
0.06
0.06
0.04
0.03
0.03
0.80
0.54
0.81
0.0 0.4 0.8 1.2 1.6 2.0 2.4
Monaco (1995)
Malta
Finland (2003)
Belgium (1998)
Italy (2002)
France
Andorra
Ireland
Iceland (2002)
Portugal (2003)
Spain
Luxembourg
EU Member States before May 2004 (2003)
Republic of Moldova
EU average (2003)
Kazakhstan
Israel
Lithuania
Poland (2003)
Austria
EU Member States joining EU May 2004
Norway
Sweden (2000)
United Kingdom (1992)
Switzerland
Germany
Estonia (2003)
Czech Republic
Croatia
San Marino (1990)
Hungary
Ukraine
Denmark (2002)
Slovakia
Slovenia (2003)
Albania (2003)
Turkey (2003)
Belarus
Serbia and Montenegro (2002)
Azerbaijan (2003)
CIS
Turkmenistan
Netherlands (2003)
The former Yugoslav Republic of Macedonia (2001)
Cyprus (2003)
Bulgaria (2000)
Tajikistan (2003)
Bosnia and Herzegovina
Russian Federation
Georgia
Romania
Armenia
Kyrgyzstan
Uzbekistan
per 1000 population
Source: WHO Regional Office for Europe, 2006.
Note: CIS: Commonwealth of Independent States.

78
Health systems in transition Croatia
The market is dominated by the Croatian firm “Pliva”, one of the largest
companies in the country and one of the largest pharmaceutical companies in
central and eastern Europe. Although domestic producers Pliva and Belupo
make up over 40% of the market, a number of foreign firms are represented,
including Krka and Lek from Slovenia, Merck Sharp and Dohme, Pfizer,
GlaxoSmithKline, AstraZeneca, etc. The Slovene companies, which constitute
approximately 12% of the market, enjoy the advantage of having familiar
products for the Croatian consumers, since they were once considered domestic
producers (in the former Yugoslavia). Slovene companies are exempt from
import duty. Thus, they enjoy a price advantage over other, non-CEFTA (Central
European Free Trade Agreement) imported pharmaceuticals, which are subject
to a 15% tariff.
There are currently a number of constraints on the market that primarily affect
international suppliers. In particular, the HZZO is a purchasing monopoly. The
HZZO controls drug prices and has been imposing price cuts. The registration
of new drugs on the market takes two to three years. However, the 2003 Drugs
Law introduced a new Agency for Drugs and Medical Products and set out a
shorter, more ambitious time frame for registration (210 days for ready-prepared
drugs). However, this deadline is not yet being met consistently, but the policy
had an impact on reducing delays.
Although the 2003 Drugs Law was largely aligned with EU legislation,
it lacked provisions for the protection of intellectual property rights. The
absence of data exclusivity from previous legislation was advantageous for
domestic producers of generic drugs and a matter of concern for international
research-based brand name suppliers. In 2004, Croatia introduced provisions
for the protection of intellectual property rights similar to those existing in the
European Community.
The price differential between brand name imported drugs and generics
produced by domestic producers is generally less than 20% (UK Department
of Trade and Investment, 2005).
Pharmacies have largely been privatized, mostly by renting existing pharmacy
premises to private pharmacists. New private pharmacies have also opened in
their own premises. Privatization has largely been successful in improving the
supply of, and access to, drugs, but the undesirable consequence has been that
pharmaceutical expenditure has increased.
4.7.1 Pricing of pharmaceutical products
The Drug Reference Price System was introduced in 1999 in an attempt to
contain pharmaceutical expenditure. The prices of medicines are determined

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biannually by comparing wholesale prices from three reference countries
(Slovenia, France and the Czech Republic) and two additional countries,
when necessary. An initial assessment by the Health Insurance Commission
of Australia compared the Croatian wholesale prices of a sample of 45 drugs
against the Australian price for a comparable product (Health Insurance
Commission of Australia, 2003). The results showed that 36% of medicines
were below Australian prices and 64% were above them. While this represents
an assessment based on a limited sample, the exercise indicates that there might
be opportunities for further cost savings by changing the reference pricing
process, including possible changes in the list of reference countries. However,
the relatively small size of the Croatian market would present a disadvantage
in negotiating prices with the manufacturers.
To curb the volume of prescriptions, the HZZO has imposed annual limits
on the number of prescriptions per beneficiary and limited the number of drugs
per prescription. Exceptions are permitted for special cases. As indicated in
Fig. 4.9, these initiatives have not been effective since the average number has
increased from five prescriptions in 1996 to seven prescriptions in 2002. At
present, the HZZO reviews prescribing practices but does not include them as
part of performance indicators for payments. Overspending by individual GPs
is, however, subject to financial punishment of up to 10% of monthly capitation.
The punishments are enforced.
As shown in Table 4.2, the HZZO’s expenditure on drugs has decreased
significantly between 2001 and 2002. This may reflect the effect of increased
co-payment rates under the 2002 Health Insurance Law, rather than an effective
reduction in the volume of prescriptions. Indeed, over the same period, the
average prescription per beneficiary has not declined. The pharmaceutical
expenditure data shown in Table 4.2 represent expenditures covered by the
HZZO without accounting for private out-of-pocket spending. Thus, the extent
to which cost-containment has been achieved by shifting costs directly to the
patients requires further investigation.
4.7.2 Reimbursement
Once a drug is registered, its manufacturer may apply to have the drug placed on
the positive list for reimbursement coverage by the HZZO. The drug is reviewed
by the Positive List Committee, comprising representatives from the HZZO, the
HZJZ, clinical pharmacologists and clinicians. They evaluate the application
in terms of clinical efficacy and affordability to fix the level of co-insurance. It
has been noted that the Positive List Committee lacks staff with a background

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in health economics or pharmacoeconomics to assess the economic evaluation
presented in the application (Health Insurance Commission, 2003).
4.8 Health technology assessment
The Unit for Professional Supervision in the Ministry of Health regulates the
introduction of new diagnostic and therapeutic procedures. However, there is
currently no formal system in place for health technology assessment in Croatia.
Despite the Government’s policies being focused on cost-containment, there has
been minimal discussion on statutory health insurance coverage or the public
financing of new medical technologies.
Table 4.2 HZZO expenditure on prescription drugs, 1997–2002 in HRK millions (US$
millions)a
1997 1998 1999 2000 2001 2002
Expenditure on prescription
drugs
1 345
(171)
1 831
(233)
1 529
(194)
2 238
(285)
2 096
(267)
1 664
(212)
Expenditure on prescription
drugs (in constant 1997 prices)
1 345
(171)
1 689
(214)
1 356
(172)
1 864
(237)
1 728
(220)
1 333
(170)
As percentage of total HZZO
expenditure on health (%) 16.5 17.9 13.4 16.9 16.5 14.1
Source: Croatian Institute for Health Insurance, 2003
*Note: a all figures converted to US$ on the basis of the average 2002 exchange rate between
HRK and US$, as reported by the Croatian National Bank.

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Fig. 4.9 Number and average cost of drug prescriptions covered by the HZZO,
1994–2002
0
1
2
3
4
5
6
7
8
1994 1995 1996 1997 1998 1999 2000 2001 2002
Prescriptions per beneficiary
0
10
20
30
40
50
60
70
80
Average expenses per prescription
Number of drugs prescriptions per beneficiary Average expenses per prescription, constant HRK,1997
Source: World Bank, 2004.

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5.1 Third-party budget setting and resource
allocation
Resources are allocated through the HZZO, the State budget and the
county revenue (Fig. 5.1).
Health insurance contribution rates are negotiated annually between
the Ministry of Health, the Ministry of Finance and the HZZO. The Parliament
then ratifies these rates. The State takes responsibility for any deficit incurred
by the Health Insurance Fund. Since 2001, health insurance contributions have
been collected through the State Treasury. If insurance contribution payments are
delayed, the HZZO may withdraw health care coverage from an individual.
The Ministry of Health and the Ministry of Finance jointly decide the State’s
annual budgetary contribution towards health care, which is then ratified by
the Parliament. Counties also contribute from their own revenue towards the
capital costs of the facilities that they own.
To ensure equality of access to all citizens, HZZO-contracted health care
providers operate within the framework of the national health care network. The
network determines allocation of public financial resources between counties
according to morbidity, mortality, demographic characteristics, etc.
The HZZO distributes resources for services according to agreed contracts
with health care providers. These contracts fix the list, quality and scope of
services, schedules, requirements for cost accounting and payment subject to
the guidelines set out in the Government’s national health plan.
5 Financial resource allocation

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Fig. 5.1 Third-party budget setting
State Government/Ministry of Finance
Croatian Health Insurance
Institute (HZZO)
Ministry of Health
Clinical hospitals
and centres County revenue
County
hospitals
Polyclinics
and health
centres
Primary
care
doctors
The 1993 reforms introduced a capitation payment for the primary care
sector, and a point system for the hospital sector. Subsequently, the Ministry
of Health introduced global budget caps for hospitals and reference pricing for
pharmaceuticals in 1999. Although these measures appear to have had some
moderating effect on the rising costs of care, their effectiveness in promoting
productivity and assuring quality of care have been limited. For example, the
introduction of the global budget cap-and-point system for hospital services
(see section 5.2) may be leading to rationing of services through waiting lists for
certain high-cost services, such as cardiac surgery and percutaneous transluminal
coronary angioplasty. Delays in treatment could have an adverse effect on the
patient’s health outcome.

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5.2 Payment of secondary and tertiary care
providers
Croatian hospitals are currently funded according to a two-tiered system. Costs
such as investments into infrastructure, medical equipment and information
technology are mainly funded by decentralized state funds allocated to
counties (owners of general hospitals) that then, subject to Ministry of Health
approval, distribute the funds to individual hospitals. Counties and the HZZO
also participate to a lesser extent in funding hospital procurement of medical
equipment. Medical services are funded separately by the HZZO, according to
a combination of a point-based hospital payment system and a diagnosis-related
groups (DRGs) system.
The point-based hospital payment system is essentially a fee-for-service
reimbursement system. Hospitals are reimbursed on the basis of inputs
rather than outcomes. The hospital payment system consists of three separate
components: (i) hotel services, paid by a flat per-diem payment; (ii) physician
services, paid per procedure using the WHO point system (World Bank, 2004);10
and (iii) pharmaceuticals and other materials which are paid for separately,
depending on the cost of each item. In addition, each hospital is limited by
a global budget cap. If a hospital exceeds its annual ceiling, it faces financial
penalties.
The system does not allow hospital management to be rewarded for
productivity gains. Hospitals are motivated to keep beds full and extend lengths
of stay, since high occupancy results in steady funding through per-diem
payments and since high costs tend to be accumulated in the initial days of
hospital stays. Low occupancy rates also increase the risk that the HZZO will
lower the global budget ceiling. The contract arrangement makes it difficult
to adjust staffing levels in response to shortened lengths of stay and other
efficiency gains, since staffing costs remain fixed. Cost overruns are likely to
result in the imposition of arbitrary internal controls, e.g. by restricting the use
of medications or procedures, rather than a response to improve productivity,
such as reorganization of staffing and other systemic reforms. While global
hospital funding contains costs in the broader system, parallel reforms in hospital
management and structural realignment of the incentive structure are needed in
order to protect access to and ensure appropriate quality of care.
10 This is a fee-for-service system based on a list of services with a number of points allocated to each
service.

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In 2002, the Government started introducing a parallel DRG-based payment
system. By 2005, the number of services charged by the DRG system included
118 selected diagnoses. Interventions for these cases were either costly, high
volume or were delayed because of a long waiting list. Under this system,
referred to as Procedures Paid by the Therapy Procedure (PPTP, translation
from Croatian, same concept as the DRG system), in order to encourage a more
efficient use of resources, the HZZO would negotiate the volume of contracts
prospectively with all hospitals for these selected interventions, using case-
based reference details. This strategy is intended to reduce the waiting list while
improving control over the total costs.
The use of broad-based case groupings, as opposed to more detailed DRGs,
as shown in Table 5.1, could lead to cream-skimming. The hospital could attempt
to avoid high-risk, high-cost patients by “dumping” them on other providers. As
patients are referred to hospitals on a geographical basis, they cannot choose
to which hospital they would like to go. However, general hospitals (county
hospitals) are allowed to refer cases that are judged to be clinically complicated
to clinics/clinical hospital centres that provide state-of-the-art treatment.
The Government intends to eventually move towards a comprehensive
prospective case-adjusted payment system based on DRGs. This will represent
an important step in rationalizing incentives in the system. However, DRGs can
give way to another form of “gaming” known as “code creep” (coding patients
Table 5.1 Comparison of United States DRGs, Australian DRGs and Croatian PPTPs
for open-heart surgery
United States
Medicare DRGsa
Australian DRGs
(Version 4.1)
Croatian PPTPsb
106 Coronary bypass
with PTCAc
F05A Coronary bypass with invasive
cardiac investigative procedure
with catastrophic CCd
Coronary bypass
surgery
107 Coronary bypass with
cardiac catheterization
F05B Coronary bypass with invasive
cardiac investigative procedure
without catastrophic CC
108 Other cardiothoracic
procedures
F06A Coronary bypass without invasive
cardiac investigative procedure
with catastrophic or severe CC
109 Coronary bypass
without cardiac
catheterization
F06B Coronary bypass without invasive
cardiac investigative procedure
without catastrophic or severe CC
Source: World Bank, 2004.
Notes: a DRGs: diagnosis-related groups; b PPTP(s): “procedure(s) paid by the therapy
procedure”; c PTCA: percutaneous transluminal coronary angioplasty; d CC: complicating
condition.

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as having more serious/complicated conditions that they actually do). If this
occurs, then the hospital would be reimbursed more funds than it actually spent
on a patient.
To the extent that it is possible, more advanced case-based systems could
be implemented to avoid the unnecessary shifting of costs. While it may be
necessary to implement simpler coding systems initially, this could be viewed
only as an intermediate step until information systems are brought up to
par. Moreover, with appropriate training for nursing and medical staff, more
advanced coding can be put into place.
A related constraint is the limited scope available to hospital management to
respond to the new performance-based payment systems. Hospital management
will need to have greater flexibility and autonomy in decision-making in order
to achieve the desirable productivity gains. For example, the introduction of
performance-based payments will need to be negotiated with trade unions.
Their support will be essential for the success of any hospital reorganization
initiatives.
The Ministry of Health is currently implementing a restructuring of the
county hospital system in order to introduce more day surgeries and other
infrastructure improvements. The hospital restructuring is accompanied by
a reconfiguration of the county health system to expand the alternative care
services that will provide community-based post-acute care and rehabilitation
services. These alternative care providers are intended to provide post-acute care
in a community setting for the patients discharged from the hospital. A detailed
review of these county-level activities could provide valuable information for
the national reform process.
5.3 Payment of primary care physicians
The shift to capitation payments and privatization of primary care physicians
was intended to give physicians incentives for more efficient and effective
care. Findings from a study analysing the effects of the privatization process
for primary health care in Croatia indicated that privatized practices performed
better in improving access to their services for patients: they increasingly
offered the possibility of first and follow-up appointments at precise times,
scheduled visits by telephone and provided telephone advice outside working
hours (Hebrang et al., 2003). They also showed greater intention to honour
appointment times in order to lower their patients’ waiting times.

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As of 2004, GPs have received additional reimbursement for preventive
check-ups (for adults over 45) and for a restricted number of services for which
they are allowed to charge (from 2005) according to a DRG (PPTP) schedule.
The total funds in addition to the capitation payment may not exceed 7% of
annual capitation (12% for GPs working in retirement/nursing homes).
In terms of cost-containment efforts and their role as gatekeepers, primary
care physicians could play an influential role in determining the costs of health
care. However, analyses of GP referral versus treatment practices are largely
lacking. Alongside capitation and privatization, reports from the HZJZ have
indicated substantial reductions in numbers of rendered preventive services
and home visits as well as large increases in numbers of referrals to secondary
and tertiary health care providers (see Box 5.1). The HZZO has attempted to
react by limiting the permitted numbers of referrals by patient, but has failed
to monitor the trend. The current system does not provide the necessary means
for utilization review that would monitor and evaluate the referral patterns of
the GPs. Also, see section 4.2 on primary health care.
Box 5.1 Trends in primary care service provision between 1990 and 2003
Number of GP home visits reduced by 35%
Other primary care physicians’ home visits reduced by 92%
Number of referrals increased by 25% (between 1995 and 2003)
Number of GP preventive check-ups reduced by 72% (between 1990 and 2002)
•
•
•
•
Source: HZJZ, 2004b.

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6.1 Health care reform 2002
In 2001, the Ministry of Health produced the Health Care System Reform,
which was subsequently adopted by the Parliament in July of 2001. The
document identified a number of fundamental problems in the Croatian
health care system (see Box 6.1).
Health Insurance Law 2002
A centrepiece of the Government’s health financing reform is the Health
Insurance Law enacted in 2002. The 2002 Law introduced a number of new
measurements to limit coverage and increase revenue for the HZZO, including
the establishment of a new co-payment schedule for selected services. Higher co-
payment rates were put into place for hospital and specialist services, diagnostic
tests and prescription drugs. Also, a new voluntary product, “Supplemental
Health Insurance” – complementary health insurance in EU terms, was offered
to fully cover co-payments for basic services. The Law also brought under the
HZZO administration the collection and payment of workers’ compensation
and occupational health programme, which were previously administered by
private insurers.
On the revenue side, the Government’s reforms included: (i) a reduction in
the wage-related insurance contributions; (ii) the establishment of new health
insurance contribution principles for the central and local governments – their
responsibilities were extended to include subsidizing the premium and co-
payments for special categories of the population such as the unemployed, war
veterans and the disabled, and contributions to social health insurance; and (iii)
the consolidation of social insurance collection under the State Treasury.
6 Health care reforms

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Health systems in transition Croatia
Problems
Financial insolvency of the HZZO.
Inappropriate planning and management.
Non-transparent distribution of public and private functions of health professionals
– some physicians were legally allowed to work both in public hospitals and in their
own private clinics. At present, some physicians can work as private practitioners in
public hospitals in the afternoons.
Uneven concentration of specialist medicine in large cities, especially Zagreb.
Ineffective use of health care services.
Unrealistic expectations from the insured and health workers as to the level and span
of health care that can be financed by the economy.
Undeveloped system of control and the need for an enhancement of the quality of
care.
Unequal access to care according to ability to pay and place of residence.
Lack of maintenance and investment.
Uneven structure of the costs in the health system, which is characterized by a large
proportion of costs directed towards wages rather than treatment.
Unbalanced employee structures, with too large a share of nonmedical personnel (i.e.
administrative staff).
Informal payments.
Reform objectives
Financial stabilization
Cost-containment
Introduction of planning and management into the administration
Reorganization of the financing and reimbursement system
Improvement of efficiency and quality in the provision of services
Strengthening of preventive services and of primary health care
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Box 6.1 Problems and reform objectives identified by the Ministry of Health, 2001
Source: Ministry of Health, 2001.
Collectively, these reforms were intended to alleviate the tax burden for
the insured and to reduce distortions found in the labour market. The forgone
revenue from payroll tax was to be replaced through other revenue sources
including co-payments, complementary health insurance and government
transfers. Finally, the reforms aimed to improve the financial and debt
management of the HZZO funds.
Central government transfers had been made retroactively to cover the
shortfalls in the HZZO budget or to cover deficits accumulated by health
care providers. In 2002, actual government transfers to the HZZO showed a
significant decrease over the previous year, with debt financing still being used
to cover the shortfall in budget. This outcome suggests that the cost of financing
the subsidies has not yet been fully evaluated or included in the budget plan.

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The parameters for determining subsidy levels will need to be defined for
transparency and planning purposes.
6.1.1 Primary care
With regard to primary health care, the 2002 reform aimed to introduce
utilization and quality reviews and a performance-based payment system that
would encourage quality of care while discouraging unnecessary prescriptions
and referrals by GPs. Furthermore, the reform aimed to reintroduce group
practice and family medicine teams as the principal mode of delivery, and
develop contracts with the HZZO to reinforce the mentioned trends. Finally, the
reform was intended to support the development of clinical information systems
and management tools that would enable utilization and quality reviews with
minimal administrative burden.
6.1.2 Hospital care
Reforms in the hospital sector have been primarily driven by the inefficiency
of the existing delivery systems, rising costs and consumer dissatisfaction with
the quality of care (Oreskovic, 2001). Neither the public nor the policy-makers
have been happy with recent factory-like hospital designs. The design of a
hospital must reflect its many different roles, such as teaching and research,
as well as direct patient care. An important issue has been how to decide upon
the optimal size and distribution of the hospital system. The hospital system in
Croatia was built for a different environment (the former Yugoslavia), a different
organizational system (self-managed socialism) and a larger population. In
addition, changing patterns of disease, rising public expectations and new
technology mean that policy-makers face a variety of pressures in restructuring
the hospital system.
The district of Koprivnica has been selected to pilot some health care reforms.
The project covers the district referral hospital located in the city as well as
primary care facilities and personnel throughout the county. Reform activities
are grouped into three major areas: (i) service delivery, (ii) purchasing, and
(iii) information technology. Accordingly, the project seeks to strengthen the
links between the hospital and the community by providing more home-based
support services, by improving the discharge process and by involving GPs in
the post-hospital management of their patients. More specifically, strategies
revolve around:
making recommendations on improving the hospital discharge planning
system;
•

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identifying patients who could be discharged earlier under the management
of qualified practitioners;
identifying the most appropriate model to meet service objectives;
identifying the required resources (staff, training, vehicles and equip-
ment);
identifying the number of patients occupying acute hospital beds that would
be better suited to nursing home care;
analysing referrals and admissions to nursing home beds.
In order to improve the quality of health services and thus increase patient
and citizen satisfaction, the Ministry of Health has undertaken a state-wide
survey of patient opinions on their hospital experiences (Marusic, 2001).
Among other things, the survey enquires about admission; communication with
staff; help from staff; staff sensitivity; patient degree of satisfaction with the
hospital; what they liked or disliked; what improvements they could suggest;
and who they think can best assure protection of their rights. The analysis of
this survey helps to identify strengths and weakness of each hospital and its
specific departments. This can then form the basis for long-term policy aimed
at improving hospital care.
The implementation, and thus the effects, of the 2002 reform have been
interrupted by the outcome of the 2003 general elections – the change of
government. Thus, the future of the reforms started in 2002 remains to be seen.
The new Government, elected in 2003, has – until end of 2005 – primarily kept
its focus on controlling hospital and pharmaceutical expenditure and broadening
the revenue base of the system by introducing administrative charges, as has
been previously discussed. Other initiatives highlighted since 2003 include
boosting preventive check-ups in primary care, expanding transplantation
surgery programmes and stimulating kindness of medical professionals towards
patients.
6.2 2006 National strategy for the development
of the health care system
In 2006, the Croatian Parliament began a debate on several issues including:
the National Health Strategy for the period 2006–2011, the Bill on Compulsory
(Social) Health Insurance, the Bill on Voluntary Health Insurance, Amendments
to the Health Care Act, and the Bill on Health Insurance Covering Work
Safety.
•
•
•
•
•

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In February 2006, the Croatian Ministry of Health published a comprehensive
document entitled “Strategy of the development of the Croatian health care
system 2006–2011”. The document specifies the political foundations on
which future reforms are to be based. The basic concepts that are to provide a
framework for future health care planning are:
accessibility (geographical, timely care and economic accessibility)
equity and equality of citizens
effectiveness
quality of medical care
patient and health professionals’ safety
solidarity.
In order to achieve these objectives, according to the Ministry of Health,
comprehensive reforms will be necessary in the health care system, its system of
financing and in the public health system. Furthermore, the document specifies
certain preconditions that have to be met so that future reforms can achieve
their targets. These include:
full informatization of the health care system
partnership between health professionals and users
transparency in the provision of health care services
decentralization of decision-making and responsibilities
paying attention to costs of medical care
unity and collaboration between segments of the health care system
Europeanization of the Croatian health care system – in light of preparations
for accession to the EU.
The conceptual framework of the Strategy specifies future goals and targets
according to the levels of health care provision – primary, secondary and tertiary.
However, the document accentuates the importance of integrated medical care
and of full cooperation between different levels of health care provision. The
main principles on which health care reforms will be based are:
centralized policy-making, standards, norms, planning and monitoring;
integrated health care provision;
decentralized management (devolution of responsibilities);
primary health care as the foundation of integrated health care, planned to
deal with up to 80% of all medical cases;
setting up a national agency in charge of monitoring quality of care and
quality of medical education as well as accreditation of foreign professionals
to practise medicine in Croatia;
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•

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Health systems in transition Croatia
informatization as a precondition of monitoring quality and cost of care;
securing and rationalizing consumption of resources according to the criteria
of equality, solidarity, accessibility, rationality, quality and special needs;
improvements in hiring and paying conditions based on flexibility,
entrepreneurship, success and elimination of unnecessary bureaucracy;
more patient choice with a view to greater satisfaction with the system.
6.2.1 Primary care
In primary care, reforms will aim to reduce the number of patients per GP
(for example from 1700 to 1500 per GP) in order to improve the quantity and
quality of services provided. Particular attention will be paid to education,
both undergraduate/graduate and continuous education of doctors practising
in primary care. Reforms will aim to ensure access to new technologies,
particularly telemedicine. Primary care doctors will be stimulated to engage in
health promotion activities and to collaborate closely with specialists both before
and after specialist care. They will also be stimulated to provide home care.
The reforms will encourage the development of the group practice model
and will reform payment mechanisms according to the fundholding model, as
a first step for prescribed drugs, and later for services provided by specialists.
In addition, the organization and status of health centres, provision of public
health services in primary care, composition of primary care teams, and their
collaboration with providers of social care, patient groups, etc., will be analysed
and (re)defined.
Primary care will be developed according to the family medicine model.
Additionally, the Ministry of Health intends to start a network of mental health
centres, with the aim of improving social integration of people suffering from
mental illness.
6.2.2 Secondary care
In order to improve governance and resource allocation, a national database
will be formed containing relevant information (employees, services provided,
infrastructure, etc.) and categorizing all hospitals in Croatia. All hospitals will
have to undergo accreditation to determine whether they adhere to a set of
standards and norms.
Owing to escalating health care costs, the reforms will aim to reduce the
current number of hospitals and hospital beds. Furthermore, reforms will aim to
rationalize acute hospital care provision and develop alternative, more rational
•
•
•
•

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models of service provision such as outpatient care and day hospitals. With
regard to long-term care, institutions providing cost-conscious long-term care
such as nursing homes will be favoured and developed. The reforms will also
aim to coordinate secondary care institutions between neighbouring regions, to
avoid duplication of unnecessary costs for equipment and personnel.
6.2.3 Tertiary care
In tertiary care, reforms will be aimed at achieving the highest possible level
of quality of care provided in all institutions. The vital role of tertiary medical
institutions in medical education will be further pursued. Furthermore, their
role in the hospital system requires redefining as they currently provide 49%
of all outpatient consultations. This is considered to be inappropriate, as a
proportion of these consultations could be handled in institutions providing
secondary or primary care. Finally, development of tertiary care institutions
will be particularly encouraged outside of the capital, to ensure accessibility
of high-quality tertiary care in all parts of the country.
6.2.4 Prescribed drugs
Informatization of drug prescribing is intended to facilitate monitoring and
control, in order to achieve effective and economically rational prescribing
practices. This approach could also facilitate the creation of sound national
prescribing policies. Furthermore, with the same goal in mind, issues pertaining
to prescribing will be made more prominent in continuous medical education
through seminars and courses.
A basic list of drugs covered by social health insurance will be set up, while
other drugs will be made available at a cost to the patient. The new strategy
will encourage the prescribing of generics and will introduce reference pricing.
Cost sharing will be used to encourage patients to consider drug prices when
choosing a therapy.
6.2.5 Emergency medicine
Reforms will be aimed at creating integrated emergency medicine systems at
county level. The system of emergency medicine provision will be tailored
to meet local needs and ensure high quality of care nationally. Emergency
medicine services will be better coordinated with hospitals to ensure quality
and timeliness of services provided.

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6.2.6 Health care financing
In health care financing, reforms will be targeted at reducing the public
proportion and enlarging the private proportion of health care expenditure.
Complementary and supplementary health insurance and out-of-pocket
payments will be regulated and further developed. A negative list of services not
covered under social health insurance will be defined. Primary care providers
will earn a greater proportion of their wages through case-adjusted and fee-for-
service payment mechanisms.
Hospitals will be categorized and accredited for specific procedures. This is
intended to enhance their efficiency and the quality of services provided. The
development of national guidelines and algorithms for therapeutic procedures is
also expected to work towards this goal. Current hospital payment mechanisms
will be substituted by diagnosticko terapijske skupine, a local version of
the DRG payment system. The procurement of diagnostic devices will be
rationalized according to clinical guidelines and the results of accreditation
and categorization of hospitals. As part of the informatization of the health care
system, smart cards with all medical and financial details regarding the patient
and treatment providers will be introduced. Finally, the new Strategy plans to
accentuate the importance of health technology assessment and evidence-based
decision-making in Croatian medicine.

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7 Conclusions
The challenge for Croatia is to make better use of the significant resources
allocated to the health sector. Recent reforms appear to have succeeded
in containing expenditure. However, demographic and epidemiological
transition points to a potential for an increasing demand for health care. The
pressure on public resources to spend more on health may intensify in the
coming years, and will have to be met with prudent allocation of resources and
continuous efforts to improve productivity wherever possible.
The Government has taken steps towards tackling a broad range of policy
reforms to improve the performance of the health system. Still, there remain
important actions that need to be prioritized and implemented in order to ensure
the policy and reform goals are actively achieved. The following target areas
are of particular importance.
Improving budget planning and fund management: While it appears that
some success in containing public spending on health has been achieved,
the trend may not be fully capturing the effect of cost shifting to the
providers and users of health care. The fact that the Government continues
retrospectively to finance arrears accumulated by the health care providers
is a source of concern. The Government will need to ensure that such
retrospective financing does not undermine the ongoing efforts to improve
efficiency through HZZO payment reforms. Good accounting practice could
be established at all levels to enable the Government to track spending
accurately. Furthermore, the cost of financing subsidies through general
revenues could be fully evaluated and included in the budget plan.
User charges and informal payments: Co-payments could be redesigned to
discourage unnecessary use of health care, but not to be a barrier to accessing
appropriate care. Along these lines, the impact of informal payments on
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patient access to services needs to be included in the surveys and evaluation
procedures.
Improving quality and efficiency of health services: The HZZO’s capacity as a
purchaser of health care services will need to be strengthened by building on
the ongoing reforms in the provider payment system, including the design of
contracts, introduction of appropriate quality and utilization review processes
and an audit system, and investment in the upgrading of information systems
for both the HZZO and the health care providers. Parallel reforms in the
management and organization of the health care providers will be needed
in order to ensure that they are better able to respond to performance-based
contracts. Investments in new technologies or decisions to include certain
procedures under the coverage of the HZZO need to be based on the best
available evidence of safety appropriateness (evidence-based medicine) and
cost–effectiveness
Decentralization and local government capacity building: Local governments
will require significant capacity building in order to take up their new
responsibilities under a decentralized health system.
Strengthening policy, planning, monitoring and evaluation: Health care
reform is a continuous process that requires ongoing monitoring and
adjustments based on regular evaluation of the policy effectiveness. Greater
resources could be directed towards strengthening the monitoring and
capacity, including regular household and facility surveys and measuring
patients’ satisfaction with health services.
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8.1 References
Babic-Banaszak A et al. (2002). Impact of war on health-related quality of life
in Croatia: population study. Croatian Medical Journal, 43(4):396–402.
Cafuk B (2006). Goals for the improvement of the healthcare system in the next
5 years. Journal of the Croatian Chamber of Physicians, 47.
Central Bureau of Statistics (2003). Statistical yearbook 2003, Republic of
Croatia. Zagreb, Central Bureau of Statistics (http://www.dzs.hr/ default_e.htm,
accessed 24 May 2006).
Central Bureau of Statistics (2004). Statistical yearbook 2004, Republic of
Croatia. Zagreb, Central Bureau of Statistics (http://www.dzs.hr/ default_e.htm,
accessed 24 May 2006).
Central Bureau of Statistics (2005). Statistical information 2005, Republic of
Croatia. Zagreb, Central Bureau of Statistics (http://www.dzs.hr/ default_e.htm,
accessed 24 May 2006).
CERANEO (1999). Basic information about the non-profit (nongovernmental)
sector in Croatia. Zagreb, Centre for Development of Non-Profit Organisations
(http://www.greekhelsinki.gr/english/reports/ceraneo-ngos_in_croatia.html,
accessed November 2005).
CIA (2005). The World Fact Book 2005: Croatia [web site]. Washington, DC,
Central Intelligence Agency (https://www.cia.gov/cia/publications/factbook/
index.html, accessed May 2006).
Croatian National Bank (2006). Economic indicators 2005 [in Croatian].
Zagreb, Croatian National Bank (http://www.hnb.hr/statistika/hstatistika.htm,
accessed May 2006).
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Dzakula A et al. (2005). Decentralization and health care reform in Croatia
1980–2002. In: Shakarishvili E (ed.) Decentralization in health care – Analyses
and experiences in central and eastern Europe in the 1990s. Budapest, Local
Government and Public Service Reform Initiative, Open Society Institute.
EURACT (2001). Annex 1: Review of national educational activities after
EURACT Council meeting in Kusadasi. Leuven, European Academy of Teachers
in General Practice.
Government of the Republic of Croatia (1999). War damage in the Republic of
Croatia. Zagreb, Government of the Republic of Croatia (Croatian Government
Bulletin; http://www.vlada.hr/bulletin/1999/sep-oct/documents.html, accessed
12 January 2006).
Government of the Republic of Croatia (2006) [web site]. Zagreb, Government
of the Republic of Croatia (http://www.vlada.hr/default.asp?ru=2, accessed 12
January 2006).
Health Insurance Commission of Australia (2003) [web site]. (http://www.hic.
gov.au/, accessed 12 January 2006; at time of printing, web site http://www.
medicareaustralia.gov.au/).
Hebrang A et al. (2003). Privatization in the health care system of Croatia:
effects on general practice accessibility. Health Policy and Planning, 18(4):
421–428.
Hebrang A. (1994) Reorganization of the Croatian health care system. Croatian
Medical Journal, 35: 130–136.
HZJZ (2004a). HIV info 2004. Zagreb, Croatian National Institute of Public
Health (http://www.hzjz.hr/epidemiologija/hiv.htm, accessed 3 December
2005).
HZJZ (2004b). Health services yearbook 2003. Zagreb, Croatian National
Institute of Public Health.
HZJZ (2005). Health services yearbook 2004. Zagreb, Croatian National
Institute of Public Health.
HZJZ (2006a). Communicable disease surveillance in Croatia. Zagreb, Croatian
National Institute of Public Health (www.hzjz.hr, accessed 24 May 2006).
HZJZ (2006b). Croatian National Institute of Public Health online [web site].
Zagreb, Croatian National Institute of Public Health (www.hzjz.hr, accessed
24 May 2006).
HZZO (2004). Financial report 2003 [in Croatian]. Zagreb, Croatian Institute
for Health Insurance (http://www.hzzo-net.hr/publikacije/financijsko_izvjesce_
2003.pdf, accessed 3 December 2005).
HZZO (2006). Health services yearbook 2005. Zagreb, Croatian National
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Katic M, Juresa V, Oreskovic S (2004). Family medicine in Croatia: past, present
and forthcoming challenges. Croatian Medical Journal, 45(5):543–549.
Kozumplik O, Jukic V, Goreta M (2003). Involuntary hospitalizations of
patients with mental disorders in Vrapce Psychiatric Hospital: five years of
implementation of the first Croatian law on protection of persons with mental
disorders. Croatian Medical Journal, 44(5):601–605.
Langenbrunner JC (2002). Supplemental health insurance: did Croatia miss an
opportunity? Croatian Medical Journal, 43(4):403–407.
Letica S (1989). Zdravstvena politika u doba krize [Health politics in times of
crisis]. Zagreb, Naprijed.
Marusic A (2001). Croatia starts to involve patients in medical decision-making.
Lancet, 257(9272):1958.
Mastilica M, Babic-Bosanac S (2002). Citizens’ views on health insurance in
Croatia. Croatian Medical Journal, 43(4):417–424.
Mastilica M, Bozikov J (1999). Out-of-pocket payments for health care in
Croatia: implications for equity. Croatian Medical Journal, 40(2):152–159.
Mastilica M, Kusec S (2005). Croatian health care system in transition, from
the perspective of users. British Medical Journal, 331(7510):223–226.
Ministry of Health (1999). National environment and health action plan. Zagreb,
Ministry of Health and Social Care.
Ministry of Health (2001). Health care reform: strategy and plan for the reform
of the system and health insurance of the Republic of Croatia. Zagreb, Ministry
of Health and Social Care.
Ministry of Health (2004). Programski zajam za prilagodbu [Programmatic
Adjustment Loan Report]. Zagreb, Ministry of Health and Social Care.
Ministry of Health (2006). National strategy for the development of health care
from 2006–2011. Zagreb, Ministry of Health and Social Care.
OECD (2001). OECD health data 2001: a comparative analysis of 30 OECD
countries [online database]. Paris, Organisation for Economic Co-operation and
Development (http://www.oecd.org/, accessed 23 March 2004).
Oreskovic S (2001). Reforming hospitals in Croatia: asking the patients.
Eurohealth, 7(3):36–39.
Preker AS, Jakab M, Schneider M (2002). Health financing reforms in central
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Social Security Online (2005). Social security programmes throughout the
world: Europe; Croatia. Baltimore, Social Security Administration (http://www.
ssa.gov/policy/docs/progdesc/ssptw/2004-2005/europe/index.html, accessed
3 December 2005).
Stevenson D, Stubbs P (2003). Croatia: health briefing paper. London:
Department for International Development, Health Systems Resource
Centre.
United Kingdom Department of Trade and Investment (2005). Market summary
Croatia – biotechnology. London, United Kingdom Department of Trade and
Industry (http://www.dti.gov.uk/, accessed 24 May 2005).
UNICEF (1991). The baby-friendly hospital initiative. New York, United
Nations Children’s Fund (http://www.unicef.org/programme/breastfeeding/
baby.htm, accessed 12 March 2004).
United Nations (2006). World population prospects: the 2006 revision.
New York, United Nations Department of Economic and Social Affairs
(http://esa.un.org/unpp, accessed 24 May 2006).
United Nations Cartographic Section (2006) [web site]. New York, NY, United
Nations Cartographic Section (http://www.un.org/Depts/Cartographic/english/
htmain.htm, accessed 24 May 2006).
US Census Bureau (2006). International data base population pyramids.
Washington, DC, US Census Bureau (http://www.census.gov/ipc/www/idbnew.
html, accessed 24 May 2006).
WHO Regional Office for Europe (2000). Highlights on health in Croatia.
Copenhagen, WHO Regional Office for Europe.
WHO Regional Office for Europe (2003). Surveillance programme for the
control of food-borne infections and intoxications in Europe: 8th report.
Country report – Croatia, 1999–2000. Copenhagen, WHO Regional Office
for Europe (http://www.bfr.bund.de/internet/8threport/CRs/cro.pdf, accessed
12 March 2004).
WHO Regional Office for Europe (2006). European Health for All database
(HFA-DB) [online database]. Copenhagen, WHO Regional Office for Europe
(http://www.euro.who.int/hfadb, accessed 24 May 2006).
World Bank (2000). Croatia: economic vulnerability and welfare study.
Washington, DC, World Bank (http://poverty2.forumone.com/library/
view/12543/, accessed 12 March 2004).
World Bank (2001). Croatia: Country brief. Washington, DC, World Bank
(http://web.worldbank.org/wbsite/external/countries/ecaext/Croatiaextn/
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World Bank (2003). Croatia at a glance. Washington, DC, World Bank.
World Bank (2004). Croatia health finance study. Washington, DC,
Human Development Sector Unit Europe and Central Asia Region. Report
No. 27151-HR. April 25, 2004 (http://www-wds.worldbank.org/servlet/
WDSContentServer/WDSP/IB/2004/06/16/000012009_20040616103200/
Rendered/PDF/271510HR.pdf, accessed 24 May 2006).
World Bank (2005). Croatia data and statistics, 2005. Washington, DC, World
Bank (www.worldbank.hr, accessed 24 May 2006).
8.2 Useful web sites
Andrija Stampar School of Public Health – www.snz.hr
Central Bureau of Statistics – www.dzs.hr
Croatian Institute for Health Insurance, HZZO – www.hzzo-net.hr
Croatian Medical Journal – www.cmj.hr
Croatian National Institute of Public Health – www.hzjz.hr
Ministry of Health and Social Welfare – www.mzss.hr

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8.3 HiT methodology and production process
The Health Systems in Transition (HiT) profiles are produced by country
experts in collaboration with the Observatory’s research directors and staff.
The profiles are based on a template that, revised periodically, provides detailed
guidelines and specific questions, definitions, suggestions for data sources, and
examples needed to compile HiTs. While the template offers a comprehensive
set of questions, it is intended to be used in a flexible way to allow authors and
editors to adapt it to their particular national context. The most recent template is
available online at: http://www.euro.who.int/observatory/Hits/20020525_1.
Authors draw on multiple data sources for the compilation of HiT profiles,
ranging from national statistics, national and regional policy documents,
and published literature. Furthermore, international data sources may be
incorporated, such as those of the Organisation for Economic Co-operation and
Development (OECD) and the World Bank. OECD Health Data contain over
1200 indicators for the 30 OECD countries. Data are drawn from information
collected by national statistical bureaux and health ministries. The World Bank
provides World Development Indicators, which also rely on official sources.
In addition to the information and data provided by the country experts,
the Observatory supplies quantitative data in the form of a set of standard
comparative figures for each country, drawing on the European Health for All
(HFA) database. The HFA database contains more than 600 indicators defined
by the WHO Regional Office for Europe for the purpose of monitoring Health
for All policies in Europe. It is updated for distribution twice a year from various
sources, relying largely upon official figures provided by governments, as well
as health statistics collected by the technical units of the WHO Regional Office
for Europe. The standard HFA data have been officially approved by national
governments. With its summer 2004 edition, the HFA database started to take
account of the enlarged European Union (EU) of 25 Member States.
HiT authors are encouraged to discuss the data in the text in detail, especially
if there are concerns about discrepancies between the data available from
different sources.
A typical HiT profile consists of 10 chapters:
1. Introduction: outlines the broader context of the health system, including
geography and sociodemography, economic and political context, and
population health.
2. Organizational structure: provides an overview of how the health system
in a country is organized and outlines the main actors and their decision-
making powers; discusses the historical background for the system; and

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describes the level of patient empowerment in the areas of information,
rights, choice, complaints procedures, safety and involvement.
3. Financing: provides information on the level of expenditure, who is
covered, what benefits are covered, the sources of health care finance,
how resources are pooled and allocated, the main areas of expenditure,
and how providers are paid.
4. Regulation and planning: addresses the process of policy development,
establishing goals and priorities; deals with questions about relationships
between institutional actors, with specific emphasis on their role in
regulation and what aspects are subject to regulation; and describes
the process of health technology assessment and research and
development.
5. Physical and human resources: deals with the planning and distribution
of infrastructure and capital stock; the context in which information
technology (IT) systems operate; and human resource input into the
health system, including information on registration, training, trends and
career paths.
6. Provision of services: concentrates on patient flows, organization and
delivery of services, addressing public health, primary and secondary
health care, emergency and day care, rehabilitation, pharmaceutical care,
long-term care, services for informal carers, palliative care, mental health
care, dental care, complementary and alternative medicine, and health
care for specific populations.
7. Principal health care reforms: reviews reforms, policies and organizational
changes that have had a substantial impact on health care.
8. Assessment of the health system: provides an assessment based on
the stated objectives of the health system, the distribution of costs and
benefits across the population, efficiency of resource allocation, technical
efficiency in health care production, quality of care, and contribution of
health care to health improvement.
9. Conclusions: highlights the lessons learned from health system changes;
summarizes remaining challenges and future prospects.
10. Appendices: includes references, useful web sites, legislation.

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Producing a HiT is a complex process. It involves:
writing and editing the report, often in multiple iterations;
external review by (inter)national experts and the country’s Ministry of
Health – the authors are supposed to consider comments provided by the
Ministry of Health, but not necessarily include them in the final version;
external review by the editors and an international multidisciplinary editorial
board;
finalizing the profile, including the stages of copy-editing and typesetting;
dissemination (hard copies, electronic publication, translations and
launches).
The editor supports the authors throughout the production process and in
close consultation with the authors ensures that all stages of the process are
taken forward as effectively as possible.
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The Health Systems in Transition (HiT) country proles provide an
analytical description of each health care system and of reform initiatives
in progress or under development. They aim to provide relevant
comparative information to support policy-makers and analysts in the develop-
ment of health systems and reforms in the countries of the European Region
and beyond. The HiT proles are building blocks that can be used:
to learn in detail about different approaches to the nancing, organization
and delivery of health care services;
to describe accurately the process, content and implementation of health
care reform programmes;
to highlight common challenges and areas that require more in-depth
analysis; and
to provide a tool for the dissemination of information on health systems and
the exchange of experiences of reform strategies between policy-makers and
analysts in countries of the WHO European Region.
•
•
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The Health Systems in Transition
profiles
A series of the European Observatory on Health
Systems and Policies
The publications of
the European Observatory
on Health Systems and
Policies are available on
www.euro.who.int/observatory
How to obtain a HiT
All HiT proles are available in PDF format
on www.euro.who.int/observatory, where you
can also join our listserve for monthly updates
of the activities of the European Observatory
on Health Systems and Policies, including
new HiTs, books in our co-published series
with Open University Press, policy briefs, the
EuroObserver newsletter and the Eurohealth
journal. If you would like to order a paper copy
of a HiT, please write to:
info@obs.euro.who.int

HiT country profiles published to date:
Albania (1999, 2002a,g)
Andorra (2004)
Armenia (2001g, 2006)
Australia (2002)
Austria (2001e, 2006e)
Azerbaijan (2004g)
Belgium (2000)
Bosnia and Herzegovina (2002g)
Bulgaria (1999, 2003b)
Canada (2005)
Croatia (1999, 2006)
Cyprus (2004)
Czech Republic (2000, 2005g)
Denmark (2001)
Estonia (2000, 2004g,j)
Finland (2002)
France (2004c,g)
Georgia (2002d,g)
Germany (2000e, 2004e,g)
Hungary (1999, 2004)
Iceland (2003)
Israel (2003)
Italy (2001)
Kazakhstan (1999g)
Kyrgyzstan (2000g, 2005g)
Latvia (2001)
Lithuania (2000)
Luxembourg (1999)
Malta (1999)
Netherlands (2004g)
New Zealand (2002)
Norway (2000, 2006)
Poland (1999, 2005)
Portugal (1999, 2004)
Republic of Moldova (2002g)
Romania (2000f)
Russian Federation (2003g)
Slovakia (2000, 2004)
Slovenia (2002)
Spain (2000h)
Sweden (2001, 2005)
Switzerland (2000)
Tajikistan (2000)
The former Yugoslav Republic of Macedonia (2000)
Turkey (2002g,i)
Turkmenistan (2000)
Ukraine (2004g)
United Kingdom of Great Britain and Northern Ireland (1999g)
Uzbekistan (2001g)
Key
All HiTs are available in English.
When noted, they are also available
in other languages:
a Albanian
b Bulgarian
c French
d Georgian
e German
f Romanian
g Russian
h Spanish
i Turkish
j Estonian

The European Observatory on Health Systems and Policies is a partnership between the WHO Regional Office for Europe, the Governments of Belgium, Finland, Greece, Norway, Slovenia,
Spain and Sweden, the Veneto Region of Italy, the European Investment Bank, the Open Society Institute, the World Bank, the London School of Economics and Political Science and the
London School of Hygiene & Tropical Medicine.
HiTs are in-depth profiles of health systems and policies, produced using a standardized approach that allows comparison across countries. They provide facts, figures and analysis and
highlight reform initiatives in progress.
ISSN 1817-6127