Healthcare Regulation 2024 in Turkey - Part 1

1. Organisation, financing and structure of the healthcare system

Organisation

How is healthcare in your jurisdiction organised? What is the role of government?

The healthcare system is governed principally by the Fundamental Law on Healthcare Services No. 3359 and dated 15 May 1987, which furnishes the Ministry of Health (MoH) with the authority to issue healthcare-related regulations and establish a healthcare system enabling each and every person living in Turkey to have equal and equitable access to the healthcare system.

In addition to public hospitals and healthcare institutions, universities with medical faculties may also establish hospitals under the authority granted to universities by the Higher Education Law No. 2547 and dated 4 November 1981, and this system is also quite common in Turkey.

In accordance with the policies and objectives of the MoH, the Turkish Medicines and Medical Devices Agency (Agency), which is a public legal entity with a special budget, affiliated to the MoH is established, responsible for regulating medicines, active and auxiliary substances used in drug production, substances subject to national and international control, medical devices, extracorporeal medical diagnostic devices, traditional herbal medicinal products, cosmetic products, homeopathic medicinal products, biocidal products in direct contact with the human body and special purpose dietary foods.

The Agency undertakes the following duties in general regarding the products falling under the authority of the Agency:

• granting licences or authorisations; monitoring and imposing sanctions where necessary; setting forth standards for clinical trials, licensing, pricing, manufacturing, storing, sales, import, export, marketing, distribution, promotion, monitoring, recall and usage-related activities; and
• taking the necessary precautions to maintain the accessibility of pharmaceuticals, medical devices and other products that are of vital importance.

Key legislation

What key legislation governs the provision of healthcare services in your jurisdiction?

The Fundamental Law on Healthcare Services No. 3359, the Higher Education Law No. 2547, Presidential Decree No.1 on the Presidential Organisation and the Presidential Decree No. 4 on the Organisation of Institutions and Organisations Affiliated, Related and Associated to Ministries and Other Institutions and Organisations.

Financing

How is the healthcare system financed in the various patient care sectors (eg, hospital inpatient, outpatient and ancillary services)?

The active population, retirees and their dependants are covered by the health insurance provided by the Social Security Institution (SSI). Employers must pay monthly contributions for their employees, who automatically become covered by the health insurance provided by the SSI; the self-employed may also benefit from this insurance coverage by voluntarily paying monthly contributions. The health insurance provided by the SSI covers practically every physical exam, test and treatment option (both outpatient and inpatient) conducted at public healthcare institutions and university hospitals, apart from those that are not necessary for the health of the insured person, such as cosmetic operations. The SSI also covers emergency services given to the insured at private health institutions.

Delivery structures

What are the basic structures for the delivery of care to patients in your jurisdiction?

According to the Fundamental Law on Healthcare Services No. 3359, public healthcare institutions are established by the responsible authority, which is the Ministry of Health.

A big proportion of the public is covered by the Social Security Institution (SSI) health insurance, while only a small proportion benefits from private insurance coverage by paying monthly contributions.

A new plan, the General Health Insurance, has been in place since January 2012, and accordingly every citizen in Türkiye is now under the SSI health insurance coverage. However, this coverage requires payment of monthly premiums or inclusion in a specific group. The aim is that all citizens who were not covered by the SSI health insurance packages now benefit from public health insurance.

Access and coverage

What rules govern access to treatment and emergency services? Which items and services are covered and which are not covered?

The Social Security and General Health Insurance Law No. 5,510 regulates the persons who are covered with the public health insurance. In addition, the covered treatments are regulated by the Social Security Institution Health Implementation Communiqué (Communiqué). The Communiqué notifies the principles and procedures of benefiting from the health services, travel, daily and companion expenses financed by the SSI in order to ensure that the persons whose health benefits are covered by the SSI and defined in the scope article remain healthy, regain their health in case of illness, meet the medically necessary health services as a result of occupational accident and occupational disease, illness and maternity, and eliminate or reduce their incapacity for work, and the prices to be paid by the SSI determined by the Health Services Pricing Commission for these services. In this regard, the Communiqué lists the modalities of provision and payment rules for health services financed with detailed provisions including payment in outpatient treatments, payment in home health services, payment for inpatient treatment, per service payment method, payment method based on diagnosis-based procedure, emergency health services, etc.

Exclusions from statutory coverage

Are any groups excluded from statutory coverage? Are any groups covered under alternative schemes?

The Social Security and General Health Insurance Law No. 5,510 lists all groups excluded from the public health insurance covered by the SSI. To give an example, the spouse of the employer who works unpaid at the workplace or those working in domestic services (except for those who are insured by payment of the premium and those who work for 10 days or more in a month for the same person) are excluded from statutory coverage.

Gaps in cost coverage

Are there any gaps in cost coverage (eg, user charges, out-of-pocket spending, extra billing)?

The Health Implementation Communiqué regulates the situations where the patient contributes to the healthcare costs, which are mainly for:

• outpatient physician and dentist examinations, except for family physicians contracted, assigned or authorised by the MoH;
• drugs provided in outpatient treatment;
• extracorporeal prostheses and orthoses; and
• assisted reproduction method treatments.

The collection method of co-payment fees is explained in the relevant articles of the Communiqué.

2. Healthcare pricing and reimbursement

Pricing

How are prices for healthcare services set and paid for in your jurisdiction? To what extent is the cost of healthcare services governed by law or regulation?

The prices to be paid by the Social Security Institution (SSI) for health services, exemptions and additional fees to be applied are determined by the Health Services Pricing Commission and set in the Health Implementation Communiqué (Communiqué). The Communiqué sets the prices for the healthcare services and the co-payments to be paid by the patients if needed.

In terms of the pharmaceuticals, the principles for determining pharmaceutical prices were set by the Council of Ministers in the Pricing Decree and in the Pricing Communiqué published by the MoH based on the Pricing Decree. However, as a result of the referendum held on 16 April 2017, an amendment has been made to the Constitution and a transition has been made to the Presidential Government System. The most fundamental feature of this system is the transfer of all executive authorities to the President with the annulment of the office of Prime Ministry. The President has become both the head of state and the head of executive power. Consequently, the rules and procedures for the determination of pharmaceutical prices are determined by the President, not by the Cabinet of Ministers.

The MoH is still applying the reference price system. The maximum sale prices of pharmaceutical products are determined by taking into account the lowest price of the product available on the market respectively in the reference countries (France, Greece, Italy, Portugal and Spain) and the countries of batch release and import. Where this is not available, the lowest price of the product available in EU countries – or, failing that, the ex-factory price (the sale price to wholesalers) of the product available on the market in any country across the world. The reference price takes the active substance into consideration for each product. Then it determines the price of different forms and dosages of this active substance by using a proportioning method.

The price of an original pharmaceutical is revised and becomes at most 60 per cent of the reference price upon the launch on the market of its first generic.

One of the most discussed topics relating to pharmaceutical pricing Turkey is the euro and Turkish lira currency rate (Fx rate) determined by the Price Assessment Commission competent for calculating the price of a product. According to the Pricing Decree, the Fx rate should be adapted to currency fluctuations. The Pricing Decree was amended in 2017 and it was regulated that the Price Evaluation Commission shall gather in the first 45 days of each year and announce the value of €1 based on a calculation of 60 per cent of the average value in the previous year.

However, due to the rapid change in the exchange rates, the exchange rate has been revised a few times with provisional articles. Lastly, in 2022 the value of €1 was increased thrice. For 2023, it was stated that the last amount determined shall be applied for 2023 and that the Price Evaluation Commission would not announce a new value in the first 45 days of the year. However, on 21 July 2023, the exchange rate was increase once again to 14.0387 lira.

Reimbursement

How is reimbursement for healthcare services structured?

The prices to be paid by the SSI for health services are set in the Health Implementation Communiqué (Communiqué).

In terms of pharmaceuticals, the reimbursement rules are set in the Regulation on Drug Reimbursement (Reimbursement Regulation). The Reimbursement Regulation sets out the types, quantities, usage periods and payment procedures and principles of the drugs financed by the SSI and the drugs for which financing is requested. The Drug Reimbursement Commission established in accordance with this regulation determines the drugs to be financed and the payment procedures and principles for these drugs. These medicines are published in the lists annexed to the Communiqué. These medicines include medicines that are not authorised in Türkiye, prescribed on a patient-by-patient basis and therefore procured from abroad for patients on a prescription basis.

In addition, the Regulation on the Alternative Reimbursement of Pharmaceuticals, allow companies and the SSI to benefit from discussing the terms and conditions of an alternative reimbursement model for particular products in confidentiality and set a confidential discount rate.

Adjudication

If applicable, what is the competent body for decisions regarding the pricing and reimbursement of healthcare services?

The MoH, through the Turkish Medicines and Medical Devices Agency, is the competent authority regarding the pricing of medicinal products. The competent body for reimbursement decisions is the SSI. There are also two important commissions:

• the Health Services Pricing Commission consisting of seven members in total, one member representing the Ministry of Labour and Social Security, the Ministry of Finance, the Ministry of Health, the Undersecretariat of State Planning Organisation, the Undersecretariat of Treasury and two members representing the SSI; and
• the Reimbursement Commission, is chaired by the Director General of General Health Insurance and consists of 9 original members, including three department heads, one of whom is the Head of Pharmaceuticals Department, appointed by the President of the Agency, two representatives at least at the level of department head appointed by the Ministry of Treasury and Finance, two representatives at least at the level of department head appointed by the Ministry of Health, and one representative at least at the level of department head appointed by the Presidential Strategy and Budget Presidency.

These commissions review the applications and approve their conformity in line with the related pricing and reimbursement legislation.

3. Healthcare organisations and business structures

Legal authorisation

What steps are necessary to authorise the provision of healthcare services, and what laws govern this?

The authority to grant licences to private hospitals and healthcare institutions is given to the Ministry of Health (MoH) under the Regulation of Private Hospitals. Additionally, universities with medical faculties may also establish hospitals under the Higher Education Law No. 2547. The authorisation procedure of health services is governed by the Regulation of Private Hospitals, which provides a detailed description of the licence application procedure. According to this Regulation, the MoH is entitled to grant licences for private hospitals. The applicant, who may be a private legal entity or a real person, must obtain preliminary permission from the MoH concerning the construction plan prior to the licence application.

Concerning other types of healthcare institutions, the authorisation procedure may vary slightly as each institution is regulated separately.

Legal structures

What types of legal entities can offer healthcare services?

Legal entities that are entitled to offer healthcare services are mainly governed by the Fundamental Law on Healthcare Services No. 3359. However, different entities are regulated by different regulations. Accordingly, public hospitals, private hospitals and training and research hospitals offer full healthcare services. On the other hand, community health centres, homecare services, medical clinics, dental clinics, dialysis centres, assisted reproduction treatment centres and dispensaries generally offer healthcare services limited to their specialisation.

Foreign companies

What further steps are necessary for foreign companies to offer healthcare services?

The regulatory framework on granting licences for private healthcare does not allow foreign companies to offer healthcare services. According to the Regulation on Private Hospitals, companies shall be established in Turkey and have to be registered to the Turkish Trade Registry to apply for a licence.

Healthcare arrangements

What regulatory and legal issues commonly arise in relation to healthcare arrangements? What are the main rules and principles that apply to extraterritorial participation in these arrangements?

Decisions on health services covered by the general health insurance are shown in the Health Implementation Communiqué (Communiqué). The balance of patient benefit and public finance is taken into consideration in the planning of health services to be covered by the general health insurance set by the Social Security Institution (SSI). Individual compensation lawsuits can be filed by patients regarding health services that must be covered in accordance with the principle of social state. In these lawsuits, patients demand the reimbursement of the payment that they made for health services by the SSI. The judgments in these cases are individual and may include a decision on the costs of the patient who brought the action. A favourable decision in this case regarding the reimbursement of the healthcare service costs by the SSI sets a precedent for other patients receiving the same treatment.

In terms of the extraterritorial participation, the contracts signed with Germany, Netherlands, Belgium, Austria, France, Macedonia, Azerbaijan, Romania, Bosnia-Herzegovina, Czechia, Albania, Serbia, Italy, Luxembourg, Croatia, Montenegro, Hungary and Tunisia include health insurance.

4. Competition, anti-corruption and transparency rules

Authority enforcement

Are infringements of competition law by healthcare providers pursued by national authorities?

The Turkish Competition Law is applicable to all undertakings that operate in a market for goods or services within the borders of Turkey and the Turkish Competition Authority (TCA) is the public authority that monitors and maintains competition in the market.

In Türkiye, public hospitals shall not be considered as an undertaking in terms of the Competition Law, as they are non-profit organisations. However, private hospitals and clinics’ management are deemed as a market service. Accordingly, companies that operate private hospitals and clinics are subject to the Turkish Competition Law and may be pursued by the TCA. Once the infringement of competition is established, the TCA can impose sanctions including heavy administrative fines on companies and board members and may invalidate the relevant contract or transaction that causes the infringement.

Private enforcement

Is follow-on private antitrust litigation against healthcare providers possible?

According to Article 57 of the Turkish Competition Law, anyone who prevents, distorts or restricts competition through practices, decisions, contracts or agreements contrary to this law, or abuses a dominant position in a particular market for goods or services, is obliged to compensate any damages to injured parties. Parties who claim that they have suffered damages and loss arising from the anticompetitive acts of manufacturers may claim compensation by filing a lawsuit before the courts. Accordingly, the injured party may ask for an amount equal to three times the actual loss incurred.

Anti-corruption and transparency

What are the main anti-corruption and transparency rules applicable to healthcare providers?

Under Turkish law, there is no umbrella legislation that covers every type of anti-corruption issue. Crimes such as bribery and official misconduct are punishable according to Turkish Criminal Code No. 5237, regardless of the sector in which they are committed. In terms of bribery regulated under article 252 of Turkish Criminal Code No. 5pri237, any kind of benefit provided for executing a legal transaction, which should be executed or vice versa, is prohibited with a zero-tolerance approach. In addition to the Turkish Criminal Code, the Regulation on the Code of Ethics of Public Officials and Application Procedures and Principles establishes the basic principle for public officials not to receive or give gifts and not to derive interest as a result of their duty. This Regulation also defines a blacklist of all sorts of goods and benefits that public officials cannot receive.

To guide pharmaceutical companies interacting with healthcare professionals, the Ministry of Health (MoH) defined sector-specific rules. In this sense, provisions regarding promotional interactions such as congress sponsorship of healthcare professionals, donations made to healthcare organisations, as well as all kinds of promotional materials that can be given to healthcare professionals are regulated under the Regulation on Promotional Activities of Human Medicinal Products. Similarly, pharmaceutical companies shall notify transfers of value made to healthcare professionals or organisations of any value transfers that exceed 10 per cent of the current monthly gross minimum wage.

First published by GTDT in 02.10.2023.