Bulgarian Socialist Party (BSP), the senior partner in Bulgaria’s tripartite ruling coalition, will propose to raise mandatory health insurance contributions from six to eight per cent of pre-tax wages, mediapool.bg reported on May 7.

If the proposal is approved by its coalition partners - the National Movement for Stability and Progress and Movement for Rights and Freedoms - then the hike would take effect on January 1 2009.

Coalition leaders are meeting on May 10-11 in Bansko and are expected to debate the proposal.

BSP top brass made clear it wanted the increase to be cushioned by structural changes to the social security system, so that it does not increase the tax burden on companies and employees.

Recently-appointed Health Minister Evgeniy Zhelev said that the debate on health contributions increase is yet to begin, yet said that he would plead against forcing employers and citizens to pay higher health insurances.

Finance Minister Plamen Oresharski backed the proposal, saying that the ministry would draft several scenarios for health contributions’ increases, which would not place an additional burden on citizens and employers. Most probably, he said, the increase would happen simultaneously with a decrease in pension insurance.

According to Zhelev, BSP would insist on raising the health care budget to five per cent of gross domestic product from the current 4.2 per cent.

The health minister also said that the monopoly of the National Health Insurance Fund (NHIF) would not lapse before the end of the current Cabinet's term, which expires in summer 2009, despite the resistance from BSP's two coalition partners.

The reason was an administrative one - Bulgaria is yet to build a single health information system and must change a number of laws, as well as outline the mechanism for new health insurance funds’ operation, which cannot be accomplished over the next 12 months, Zhelev said.

Concerning the privatisation of hospitals, the health minister said it the process would start once there are regulations on how the hospitals’ tangible assets would be managed. Most likely, 70 per cent would be put in private hands and the rest stay with central or local authorities, but new owners will face restrictions on the sale of lands owned by hospitals, some of which have been drawing the attention of investors interested in redevelopment.