Six regional health institutions project five billion krona deficit

Six health institutions outside the capital region are forecast to run a combined deficit of about five billion Icelandic krónur by the end of 2026 if they receive no additional funding, mbl.is reports. Their chief executives say the institutions’ financial position has rarely been weaker.

In a joint memorandum to parliament’s budget committee on the 2027 budget, the executives estimate that this year’s deficit will amount to 5 to 15 percent of each institution’s turnover. It will add to deficits accumulated in previous years.

They say the main reason for the shortfall is that the institutions have not been fully compensated for higher wage costs resulting from collective agreements signed by the government in late 2024. Most have informed the health ministry of their deficits and possible responses. The ministry has repeatedly said the institutions must bring spending in line with their allocations, which the executives warn could require measures with a significant impact on services.

The executives are seeking a permanent adjustment to the institutions’ funding base in next year’s budget, saying a persistent problem cannot be resolved through one-off allocations at the end of the year. They also call for full funding of collective agreements and realistic allocations for nursing homes, housing and ambulance services. Funding for primary care, they say, should reflect population growth and demand for services.