Mercer study

The Mercer study has been prepared in accordance with the provisions of the Memorandum of Understanding between the Republic of Cyprus and the European Commission acting on behalf of the European Stability mechanism (measure 3.2f) aiming at updating the estimation of the national health expenditure, the health expenditure within the framework of the GHS and the contribution rates required for its financing during the 2016-2025 period.

With the use of a dynamic model that takes into account the recent and projected economic environment on the basis of the assumptions for the economy that were prepared by the European Commission in cooperation with the International Monetary
Fund and having in mind the existing design of the GHS, the actuarial study concludes the following: 
  • The financing of the GHS can be achieved only with a marginal increase of the contribution rates as these are set in the General Healthcare System Law of 2001, 
  • The implementation of the GHS will not increase the existing health expenditure but on the contrary will result into savings amounting to 292 million euros in total for the 2016-2025 period due to the best practices and controls integrated therein, and
  • The introduction of the GHS will contribute, among other things, to a fairer allocation of the financing cost of healthcare and to a more efficient use of the available resources.
Finally, it confirms that the GHS implementation will not burden public finances with additional cost while it indicates that the contributions are formulated within frameworks that have been initially agreed upon and will be finalised following public consultation with the social partners.