FROM PAY-AS-YOU-GO TO ACTUARIAL RESILIENCE: MODELING THE FISCAL SUSTAINABILITY OF GREEK HEALTHCARE FINANCING, 2024-2050
Author(s)
George Mavridoglou, PhD1, George Gourzoulidis, PhD2.
1Department of Accounting and Finance, University of the Peloponnese, Kalamata, Greece, 2Health Through Evidence, Athens, Greece.
1Department of Accounting and Finance, University of the Peloponnese, Kalamata, Greece, 2Health Through Evidence, Athens, Greece.
OBJECTIVES: To evaluate the medium- and long-term actuarial sustainability of Greek healthcare financing under the pay-as-you-go (PAYG) model, to assess the comparative fiscal efficiency of alternative financing strategies, and to propose a three-pillar reform architecture for the period 2024-2050.
METHODS: An actuarial projection framework integrated Eurostat EUROPOP 2024 demographic data, EU-average age-specific expenditure profiles, and macroeconomic forecasts. Employment and wage dynamics were modelled through a Vector Autoregression (VAR) framework, yielding a wage elasticity to GDP of 1.23 (95% CI: 1.19-1.27). Two primary indicators were computed: the Actuarial Balance (AB) and the Solvency Ratio (SR). Three macroeconomic scenarios (baseline, pessimistic, optimistic) were evaluated through 2050, and two financing strategies compared: ad-hoc deficit coverage versus a pre-funded actuarial reserve mechanism accumulated by public payer (EOPYY).
RESULTS: Total health expenditure is projected to rise from €19.9 billion (2024) to €24.1 billion (2035). Out-of-pocket (OOP) payments are projected to exceed €7.5 billion by 2035 (∼33% of total expenditure), with a persistent funding gap of 8-9%. The AB remains consistently below unity (0.91-0.92) throughout 2024-2035. Long-run scenario analysis yields average Solvency Ratios of 0.94 (baseline), 0.86 (pessimistic), and 0.997 (optimistic) over 2020-2050. The actuarial reserve mechanism requires only 11.67% of the liquidity demanded by ad-hoc coverage in the baseline scenario (72.75% pessimistic), maintaining SR at 1.00-1.02 through 2050. Sensitivity analysis identifies female labour force participation (ages 55-64) as the single most impactful revenue-side lever.
CONCLUSIONS: Greece's PAYG healthcare financing model exhibits persistent actuarial imbalance under current assumptions. A three-pillar reform architecture comprising a pre-funded EOPYY actuarial reserve, restructured state subsidies, and a complementary insurance pillar, supported by rule-based automatic adjustment mechanisms, could restore long-term solvency while reducing reliance on out-of-pocket financing. Improvements in labour force participation, particularly among women aged 55-64 years, represent the most effective revenue-side sustainability lever
METHODS: An actuarial projection framework integrated Eurostat EUROPOP 2024 demographic data, EU-average age-specific expenditure profiles, and macroeconomic forecasts. Employment and wage dynamics were modelled through a Vector Autoregression (VAR) framework, yielding a wage elasticity to GDP of 1.23 (95% CI: 1.19-1.27). Two primary indicators were computed: the Actuarial Balance (AB) and the Solvency Ratio (SR). Three macroeconomic scenarios (baseline, pessimistic, optimistic) were evaluated through 2050, and two financing strategies compared: ad-hoc deficit coverage versus a pre-funded actuarial reserve mechanism accumulated by public payer (EOPYY).
RESULTS: Total health expenditure is projected to rise from €19.9 billion (2024) to €24.1 billion (2035). Out-of-pocket (OOP) payments are projected to exceed €7.5 billion by 2035 (∼33% of total expenditure), with a persistent funding gap of 8-9%. The AB remains consistently below unity (0.91-0.92) throughout 2024-2035. Long-run scenario analysis yields average Solvency Ratios of 0.94 (baseline), 0.86 (pessimistic), and 0.997 (optimistic) over 2020-2050. The actuarial reserve mechanism requires only 11.67% of the liquidity demanded by ad-hoc coverage in the baseline scenario (72.75% pessimistic), maintaining SR at 1.00-1.02 through 2050. Sensitivity analysis identifies female labour force participation (ages 55-64) as the single most impactful revenue-side lever.
CONCLUSIONS: Greece's PAYG healthcare financing model exhibits persistent actuarial imbalance under current assumptions. A three-pillar reform architecture comprising a pre-funded EOPYY actuarial reserve, restructured state subsidies, and a complementary insurance pillar, supported by rule-based automatic adjustment mechanisms, could restore long-term solvency while reducing reliance on out-of-pocket financing. Improvements in labour force participation, particularly among women aged 55-64 years, represent the most effective revenue-side sustainability lever
Conference/Value in Health Info
2026-11, ISPOR Europe 2026, Vienna, Austria
Value in Health, Volume 29, Issue 12S
Code
HPR148
Topic
Health Policy & Regulatory
Topic Subcategory
Insurance Systems & National Health Care, Public Spending & National Health Expenditures
Disease
No Additional Disease & Conditions/Specialized Treatment Areas