From 2026, Estonia introduced a new primary health care (PHC) financing reform that revisits multiple elements, including capitation adjustments and incentives for larger multidisciplinary teams (covered here), financial incentives to promote higher quality PHC (covered here) and changes to distance‑pay (kaugusetasu) formulas (covered in this post). Change in the distance payment seeks to better reflect inequalities in access and the real costs of providing services in different regions. While this approach accounted for distance from major urban centres, it did not consider other important factors such as settlement patterns or socio-economic conditions.
The reform introduces a more nuanced approach to compensating for remoteness: although the distance thresholds remained the same (location of more than 30 km from Tallinn and more than 18 km from Tartu), the payment is now adjusted using a composite index that reflects three additional dimensions: distance from the nearest hospital with an emergency department (50%), local population density (30%) and the relative poverty level of the region (20%). Distance from emergency department is measured using actual road travel (via routing data) and categorized into tiers: no additional weight for distances under 20 km, increasing to higher coefficients for distances above 20 km and above 40 km, and the highest value for islands. The population density component adjusts funding upward for sparsely populated areas, where service provision is more challenging, while the relative poverty component increases payments in regions with lower socio-economic conditions. Population density and poverty indicators are derived from national statistics once a year, allowing the model to better capture differences in service accessibility and regional disadvantages.
Although the index aims to more accurately reflect both geographic remoteness and broader barriers to access, based on 2025 and 2026 PHC first quarter expenditure data, this reform brought along a 17% decline of the distance payments. As of now, there is no public information available about how the reform affected the number of providers receiving this payment.