The paper assesses the financial situation of the health sector in the Slovak Republic. It also evaluates the efficiency of health expenditures and service delivery in comparison to the OECD and other new EU member states and suggests avenues for cost recovery and reform. The health sector of the Slovak Republic is plagued by financial problems. To turn around health system finances and achieve larger gains in health outcomes, the efficiency of health spending needs to increase and the mix and quality of real health resources need to be improved. Although Slovak's overall health spending efficiency is on par with that of the OECD, substantial inefficiencies occur in the process of transforming intermediate health inputs into health outcomes. Efficiency may be enhanced by containing the cost of drugs and reducing reliance on hospital care. Also, although cost-effectiveness may be relatively high at present, its sustainability in the future is an issue.

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