The Federation of Luxembourg Hospitals (FHL) has pushed back against claims that hospitals are overfunded, following repeated criticism from the Association of Doctors and Dentists (AMMD). The doctors’ association has argued that hospitals receive comprehensive financing from the National Health Fund (CNS), while private practitioners must cover their own operational costs.
FHL President Dr Marc Berna countered this view, stating hospitals are not overfunded. “We are already making an effort to work as efficiently as possible, to keep costs as low as possible. I would say they are correctly funded,” Berna said.
The CNS has allocated a €1.5 billion budget for hospitals in 2025. Each hospital operates under an individual budget, which is recalculated biennially to cover operating expenses.
This budget encompasses fixed costs – such as medical equipment, nursing and administrative staff salaries – as well as variable costs like medical consumables and utilities. It also includes provisions for building maintenance, groundskeeping, and other facility services.
Funding is calculated per activity area, such as radiology or surgery. The Luxembourg Institute of Health (LIH) determines the necessary staffing levels. “The second thing is the variable costs, which is all the consumables,” Dr Berna explained: “We look at what is needed in the entire operating theatre area, and then this is averaged out per individual visit to calculate an average value. That gives hospitals their cost per operating theatre visit.”
Additionally, 2% of a hospital’s budget is contingent upon meeting specific quality criteria. To receive this bonus, facilities must achieve objectives such as keeping Caesarean section rates within defined limits and performing a high percentage of arthroscopies on an outpatient basis.
Separate from the hospital budget, the CNS has allocated €736 million for doctors’ fees in 2025. All physicians, whether hospital-based or in private practice, self-employed or salaried, invoice their professional fees individually.
Hospital doctors, like their private practice colleagues, incur costs for their consulting rooms, staff, and equipment. Their operational advantage lies in access to shared hospital facilities – known as “plateau techniques” – such as endoscopy suites, MRI scanners, and operating theatres. In return for this access, Dr Berna emphasised, these doctors must be available to provide 24/7 patient care.
Data from the General Inspectorate of Social Security (IGSS) indicates that hospital expenditure has grown at a slower average annual rate (6.5%) than spending on medical care (7.6%) over the past decade.
Future health policy aims to financially support certain minor procedures, like skin or eye surgeries, in outpatient settings separate from hospitals. According to AMMD President Dr Chris Roller, such outpatient procedures could be performed for about a third of the cost.
Dr Berna acknowledged that costs in the outpatient sector should indeed be lower compared to the hospital’s fixed “cost per operating theatre visit” – an average rate applied regardless of a procedure’s complexity. However, he cautioned that from a system-wide financial perspective, the savings might be neutralised.
“If I now take out procedures that cost less than the average, then it’s clear that I can do them cheaper outside,” Dr Berna stated. Yet, removing these lower-cost procedures would subsequently increase the average price of the remaining, more complex operations performed in hospitals. “So for the system, globally speaking, the whole thing comes out to the same,” he concluded.
Based on recent experiences with an independent radiology centre, the FHL president estimates a potential saving of around 10% for procedures moved to the outpatient sector. This is attributed to less complex structures, some time efficiencies, and potentially lower building costs.
The operation of a hospital also involves commercial amenities such as cafeterias, shops, and parking facilities. These areas are not financed by the state or the CNS.
For example, at the Hôpitaux Robert Schuman (HRS), this infrastructure is managed and maintained by the HRS foundation. The foundation is responsible for these commercial spaces and collects their associated rental income. This revenue is subsequently reinvested, in part, to fund medical innovations within the hospital.
