Major health companies are planning ‘conquest’ of Eastern Europe by providing adept medical services to the patients. Private clinics expect surge in demand for services and they invest in new hospitals, expecting strong revenue growth.

Polish, Hungarian and Romanian state health departments underfunded and the employers are increasingly offer private health benefits. This will help the private companies to try their luck in the lucrative health sector of East European countries.

Public health spending in Eastern Europe is well below the European Union (EU) average according to the latest European Commission surveys in 2017, which said the health systems of Hungary, Poland and Romania were underfunded.

Total health expenditure stood at 7.2% of GDP in Hungary, 6.7% in Poland and 5.2% in Romania compared with an EU average of 9.6%.

Many Eastern Europeans, whose net wages pale in comparison to Western Europeans’, even after rapid rises in recent years, have responded by shelling out their own money so they can cut waiting times for procedures or screening services.

Private health spending amounted to 2% of GDP in Hungary and 1.8% of GDP in Poland last year, comparable or outstripping wealthier nations like Germany at 1.7% and France at 1.9%, according to data from the Organisation for Economic Co-operation and Development.

There is no comparable OECD data for Romania, the poorest of the eastern trio. However, private clinics there have also seen a surge in demand for services ranging from check-ups to complex surgery.

Romania’s private healthcare industry reached an estimated turnover of 11 billion lei ($2.6 billion) last year, up 13.8% from 2017, according to consultancy KeysFin.

MedLife, a barometer of the Romanian private health market because it operates the largest network of clinics, said it expected to exceed 200 million euros in revenue this year after making 170 million euros in 2018.

Lajos Fabian, Chairman of Hungarian group MedAlliance Holding, which acquired the Robert Karoly Private Hospital in Budapest last year and plans further acquisitions, said private health was expanding at a “break-neck pace” in Eastern Europe. “Patients are voting with their feet,” he added.

Vienna Insurance Group’s Hungarian division, Union, said private health cover was becoming an essential benefit for many employers to offer.

“In the current labour market environment, companies cannot afford risking the loyalty of their workers,” said Union board member Gabriella Almassy.

However the EU Commission says the high private health spending in Eastern European countries is leading to inequality in access to medical services.

This is deepening divisions in a region where lower-income people already have poorer health, according to analysts.

Life expectancy in Poland, Hungary and Romania remains below the EU average according to the latest health survey, which said inequalities in life expectancy by education level were “particularly large” in Central and Eastern Europe.

In Hungary, Poland and the Czech Republic, 30-year-old men with a low level of education, which the EU says is the most widely available socioeconomic indicator, can expect to live over a decade less than those with a high level of education.

“There is a layer of society, which will not be able to afford this (private health),” said Akos Ujlaki, an adviser at the Boston Consulting Group in Budapest. “If hot and cold water are not blended together in a structured manner, that will rip society apart.”

The gulf is more pronounced in Romania, where only a fraction of the population can afford private services. Private clinics in Bucharest are overrun with patients, while access to even state-funded care is limited in rural areas - home to almost half the population.

However, for many of those Eastern Europeans who can afford private care, it has become a necessity.

Michal Szolucha, a 29-year-old computer programmer in Warsaw, said private healthcare insurance was a crucial benefit for him to secure when negotiating with an employer.

“A while ago I suffered from persistent stomach pain and despite several appointments in the public service over a six-month period, no one carried out the tests I needed,” he said.

“However when I went to a doctor in a private clinic, within 48 hours all the tests were conducted and I got a diagnosis.”

The change is being driven by low public health spending as a share of the economy - which has often led to staff shortages and longer waiting times for tests and surgery - coupled with rising wages, which is making private care a viable alternative.

Reuters