As of 1 November 2024, Estonia has introduced a non-fault-based compulsory liability insurance system for healthcare providers, commonly known as patient insurance [1, 2]. The initiative aims to enhance patient safety, reduce preventable harm, and streamline the compensation for patients who experience avoidable health damage during medical care. All healthcare providers who are registered as a legal entity (for example, self-employed physicians, hospitals) were given a one-month transition period to comply with the new regulations, requiring them to secure liability insurance contracts by 1 December 2024. As of 19 January 2025, 94% of licensed health care providers (2,735 out of 2,915) have obtained the necessary insurance. Non-compliant providers risk having their operating licenses revoked by the Health Care Board [3].
The groundwork for this system began over a decade ago. The draft legislation was first submitted for public consultation in 2017, with both private and public models considered. Estonia ultimately chose a private model, citing its successful experience with mandatory motor vehicle insurance. This approach aimed to avoid the administrative complexity and costs of establishing a new public entity while benefiting from the flexibility of private insurers [1].
A key characteristic of the new system is a court-free compensation process that eliminates the need to prove fault. Patients who experience avoidable harm can file claims directly with the insurer of the healthcare provider, bypassing lengthy litigation process. Insurers must review claims within 180 days, with possible extensions if necessary. Compensation is capped at EUR 100,000 per patient per incident, with an annual limit of EUR 3 million per healthcare provider. Non-material damages, such as pain and suffering, are capped at EUR 30,000 per case. Patients who disagree with an insurer’s decision can appeal to an independent conciliation committee established under the Health Board. To further enhance patient safety, Estonia introduced a centralized database (POHAK) to systematically document patient safety incidents [4].
Drawing from the experience of similar systems in countries like Finland, the new scheme is projected to handle approximately 1,500–2,000 cases annually, with compensation granted in about 500 cases. For comparison, in 2023, the Estonian Healthcare Quality Expert Commission (EHQE), which patients turn to when dissatisfied with healthcare quality and unable to reach agreements with providers, reviewed 164 cases, identifying shortcomings in 38 instances, including 28 cases of medical errors. There is no public data on how many cases were resolved through direct compensation agreements between patients and healthcare providers without the commission’s involvement. The EHQE will cease operations in March 2025 when direct handling of claims with insurers becomes fully operational.
The financial impact on health care providers is expected to be minimal, as many already had voluntary insurance policies before the mandate. Premiums will vary based on provider type and the risk associated with their services, with an estimated budget increase of about 0.5%. The Ministry of Social Affairs anticipates that approximately half of these costs will be offset through higher service prices under contracts with the Estonian Health Insurance Fund (EHIF). To cover this, the EHIF received an additional EUR 2.2 million budget transfer for its 2025 budget, though the exact methodology for fund allocation is still in development [5].
However, the system faced an unexpected challenge: only one insurance company offered coverage, leading to concerns over high premiums. Healthcare providers pushed for a last-minute delay, arguing that the lack of competition had driven up costs. Despite these concerns, the government proceeded with the implementation as planned. The Ministry of Social Affairs has committed to analyzing the system’s performance after three years of implementation.