Letter

29 December 2025 No. 1/1225-361 Mr Arvils Ašeradens Mr Jürgen Ligi Mr Kristupas Vaitiekūnas Minister for Finance Minister of Finance Minister of Finance of the Republic of Latvia of the Republic of Estonia of the Republic of Lithuania Dear Ministers, On behalf of the Baltic Assembly, we would like to express our sincere appreciation to the Ministers of Finance for fostering cooperation of the Baltic States within your respective areas of responsibility, thereby strengthening sound budget governance, fiscal coordination, and the long-term economic resilience of our region. On 12 December 2025, the conference of the Baltic Assembly “Health as an Investment in Baltic Security and Future” was held in Riga. During the conference, Baltic parliamentarians, representatives of respective ministries and experts discussed health being a powerful long-term investment. The Baltic States currently treat healthcare predominantly as an expense rather than a strategic investment. We believe that shifting this paradigm can unlock economic growth, enhance productivity, and ensure long-term prosperity for the region. Unfortunately, the Baltic health systems lag behind the averages of the European Union (EU). Compared with the EU, the Baltic States collectively spend 7.4 % of GDP on health care, which is substantially lower than the EU average of 10.0 %. This represents health spending that is about 26% lower than the EU benchmark. As a result, compared with the EU average, the Baltic population experiences shorter and less healthy lives. Life expectancy in the Baltics is 76.9 years, while the EU average is 81.5 years. Baltic citizens also have approximately 5.9 fewer healthy years at birth than the EU average. Poor health outcomes in the Baltic States are linked to high economic costs from reduced productivity, early mortality, absenteeism, and presenteeism - annually, GDP losses across all diseases amount to 9.7 billion euros in the Baltic States, equal to 6.4 % of total Baltic GDP. These findings are of serious concern and underscore the importance of the active and close involvement of the Ministers of Finance in this process. While representatives of the Ministries of Finance of the Baltic States were not able to participate in the conference, we would nevertheless highly value your perspectives on several key issues raised during the discussions:  How do the Ministries of Finance currently assess health expenditure in the context of long-term economic growth?  What tools or methodologies do the Ministries of Finance use or plan to develop to evaluate the return on investment of health initiatives across sectors, including productivity and labour market participation?  Given the presented data on productivity losses, how can Ministries of Finance better collaborate with health authorities to quantify economic gains from improved population health?   How do you envision stronger cooperation between the Ministries of Health and the Ministries of Finance, and other economic ministries to align health expenditure with economic and social policy goals?  What steps can be taken to integrate health outcomes and return-on-investment metrics into multi-year fiscal planning and budget governance frameworks?  Do you foresee adjustments to national budget priorities to support preventive health measures that demonstrate high economic return-on-investment?  Would the Ministries of Finance support the development of a standardised regional framework for health return-on-investment measurement to enhance comparability and policy decision-making across the Baltic States? We would greatly appreciate your replies by 2 March 2026 to ensure that the Health, Welfare and Family Committee of the Baltic Assembly can discuss the received answers at the meeting on 26-27 March 2026. Please find attached the presentation of the WifOR Institute. Sincerely, President of Vice President of Vice President of the Baltic Assembly the Baltic Assembly the Baltic Assembly Jānis Vucāns Timo Suslov Giedrius Drukteinis Republic of Latvia Republic of Estonia Republic of Lithuania Chair of the Health, Vice Chair of the Health, Vice Chair of the Health, Welfare and Family Welfare and Family Welfare and Family Committee of Committee of Committee of the Baltic Assembly the Baltic Assembly the Baltic Assembly Antoņina Ņenaševa Irja Lutsar Saulius Čaplinskas Republic of Latvia Republic of Estonia Republic of Lithuania Contact person: Agnija Antanovica, e-mail: [email protected] If you measure it, you can shape it! The Societal Value of Health: Investing in Innovation for Baltic Prosperity Baltic Assembly Conference: Health as an investment in Baltic security and future Dr. Malina Müller December 12, 2025 About WifOR Worldwide presence Facts & Figures Economic research institute ​ Spin-off from the Department of Public Economics & Economic Policy at the Technical University of Darmstadt, Germany 80 Employees​ Over 650 successful projects for companies, associations, and ministries​ Research areas:​ Labor Market Health Sustainability Locations: Berlin, Darmstadt, Leipzig, Athens Projects in 55 countries – global, regional, and national analyses 1 Paradigm Shift: Health as an Investment 2 The Baltic Health & Economic Reality 3 The Socioeconomic Burden – Method and selected Use Cases 4 ROI and Societal Impact 5 Recommendations Agenda 1 Paradigm Shift: Health as an Investment WifOR is fostering a paradigm shift in health – from a cost factor to a driver for growth, innovation, wealth, and prosperity with better health PAST FUTURE Health Economy as a driver for growth and employment Health Economy as a Growth sector, diverse sector, increasing work force, contribution to GDP new career and employment opportunities Healthcare as a cost factor € Separate silos and fragmentation | Healthcare only | Input orientation | Increasing health expenditures Investment in Better quality, more health to promote outcome oriented growth and productivity Source: WifOR illustration, following Henke, Neumann, Schneider et al. (2010). 5 If you measure it, you can shape it! WifOR co-launched the G20 & G7 toolkit for strategic health investments at the H20 Summit in Geneva Büroklammer Source: WifOR 2025. Own illustration. 6 WifOR advocates the integration of global health metrics into policy making at UN, WHO, G20, G7, EU Parliament, APEC, and others What is the return on investment (ROI) of health? 1 2 3 Measure the social burden Calculate the Social Impact Quantify economic impact (cost of illness) of medical interventions of investments Source: WifOR illustration. 7 If you measure it, you can shape it! 2 The Baltic Health & Economic Reality- Burden vs. EU Benchmarks  Why shifting the paradigm from “cost” to “investment” is essential? Baltics Health Spending • 7.4 % of GDP vs. EU 10.0 % • 26 % lower than the EU average (per capita ≈ €2,500 vs. EU €3,835) Baltics Life Expectancy • 76.9 years vs. EU 81.5 years • 4.6 years shorter lives on average Source: Eurostat, 2023 9 If you measure it, you can shape it!  Annual GDP losses in the Baltics from health-related productivity losses Annual GDP Losses from Health-Related Productivity Issues - Baltic States 2023 Annual GDP losses Baltic Total 6,40% 9728 (all values in across all diseases Estonia 5,70% million €) 2205 €9.7 billion per year* Latvia 6,90% 2738 6,40% Lithuania 4785 = 6.4 % of total Baltic GDP 0 2000 4000 6000 8000 10000 12000 % GDP Total Loss (million €) Healthcare System Scale Absenteeism €1.52 billion • Enough to fund full universal healthcare for 3.6 million Baltic citizens for one entire year. Infrastructure Investment Presenteeism €2.28 billion • Enough to build and fully equip 30-45 state-of-the-art hospitals or NCD centers across the three countries.** Household Support Preventable deaths €5.92 billion • Equals the total yearly income of more than 770,000 Baltic families.*** Source: derived estimates using Eurostat,2023. *Note: Totals may not sum due to rounding, €9.7 billion = total health-related productivity losses from all diseases and external causes combined (absenteeism, presenteeism and preventable deaths). The preventable-deaths component (€5.9 bn) is calculated using the official Eurostat preventable-mortality categories mainly cardiovascular (55–60%), cancers (15–18%), mental/neurological (8–10%), and others (Eurostat preventable mortality distribution).**assuming €200–300M per facility. ***average disposable household income ≈ €12,600 €. 10 . If you measure it, you can shape it! Healthy life years (HLY) gap in the Baltics is 2-10 years below EU average Baltic citizens lose 6 healthy years compared to the EU average 5.9 fewer healthy years at birth Just 2 healthy years (52.7- 60.9 vs. EU 63.1 years) of the gap 2.9 fewer healthy years at age 65 (4.8 - 7.6 vs. EU 9.5 years) + €1 billion economic • €2 billion annual loss in productivity & gain every year extra pension/long term care costs (= 1.3 % of Baltic GDP) Source: Eurostat, 2023 11 If you measure it, you can shape it! 3 The Socioeconomic Burden – Method and selected Use Cases Individuals contribute to a nation’s wealth through both paid work and unpaid work activities over their course of their lives Capability Employment Retirement No gross value added in terms of Direct, indirect and induced gross value added national accounts Age Paid work . . 20 . . . . . . . 30 . . . . . . . 40 . . . . . . . 50 . . . . . . 60 . . . 70 . . . . . . . 80 . . . . . 90 . Capability Household production & voluntary work Additional (direct) value added ‘beyond’ GDP Unpaid work activities Age . . 20 . . . . . . . 30 . . . . . . . 40 . . . . . . . 50 . . . . . . 60 . . . . 70 . . . . . . . 80 . . . . . 90 . ⮚ By capturing unpaid work productivity in addition to paid work productivity, the Socioeconomic Burden of Diseases includes the value lost beyond GDP from both employees and the non-working population. GDP: Gross Domestic Product. 13 If you measure it, you can shape it! A disease not only affects patients’ paid and unpaid work productivity, but impacts adjacent sectors and the broader economy BROADER Socioeconomic PATIENT ECONOMY Burden Unpaid Work Paid Work Paid Work Paid Work Direct Effects Direct Effects Indirect Effects Induced Effects Contributions from The immediate The intermediate The impact of The sum of Unpaid unpaid work, such economic impact consumption of spending by Work Direct Effects as household resulting from paid goods and services households not and Paid Work activities, vital to work generated by from suppliers receiving income Direct, Indirect and the economy but people becoming triggered by the based on direct Induced GVA not reflected in the sick. direct GVA not and indirect Effects. GDP. generated by paid generated GVA. work due to sickness. Sources: The effects of having a healthier population on the overall economy have been explored under the input-output (IO) model perspective (Leontief, 1986; Conway, 2022). Conway, R.S. (2022) Empirical Regional Economics. Springer Texts in Business and Economics. Switzerland: Springer, p. 275. Available at: https://econpapers.repec.org/bookchap/sprsptbec/978-3-030-76646-7.htm (Accessed: 20 December 2022). Leontief, W. (1986) Input-Output Economics. New York: Oxford University Press GVA: Gross Value Added. 14 If you measure it, you can shape it! Quantifying the socioeconomic burden (SOB) of a disease DALYs of persons under 20 years of age are not < 20 years monetized 1 DALY SOB Paid Burden of = Work disease in 1 year fully disabled terms of 20-59 years = monetized Unpaid Work paid and 1 year without Activities unpaid work productivity/ work losses capability ≥ 60 years Unpaid Work Activities DALY: Disability-Adjusted Life Year. 15 If you measure it, you can shape it! Beyond the diagnosis: Socioeconomic burden of retinal disease (AMD/DME) in Baltics (2025) In 2025, the Socioeconomic Burden of retinal diseases is approximately $97 million* Treatment coverage for Retinal Patients Paid work ▪ Equivalent to treating 19,000 – 32,000 Baltic AMD and DME patients for 1 year.** $40 million Infrastructure Investment ▪ Enough to build 14-24 specialized retinal centers across the three countries.*** Unpaid work Blindness Prevention ▪ Enough to prevent severe vision loss or legal blindness in 4,000 – $57 million 8,000 Baltic citizens over the next 10 years, through timely diagnosis and effective retinal treatment. *Data based on DALYs and labor market participation, 2025 projections. **$3,000–$5,100 per patient per year (drug + visits + monitoring). *** assuming ~ 4$ - 7$M per center for construction + initial operating costs). 16 If you measure it, you can shape it! Beyond the diagnosis: Socioeconomic burden of HER2+ breast cancer (BC) in Baltics (2025) In 2025, the Socioeconomic Burden of HER2+ BC is approximately $288 million* Treatment coverage for BC Patients Paid work ▪ Equivalent to providing full high efficacy HER2-targeted therapy for 4,800 -7,200 Baltic HER2+ BC.** $121 million Early Detection ▪ Enough to fund 1.5 -1.9 million mammograms across the three countries.*** Unpaid work Progression Prevention ▪ Enough to reduce the number of patients progressing to metastatic $167 million HER2+ breast cancer by an estimated 800–1,600 cases over the next 10 years, through timely diagnosis and full access to high-efficacy targeted therapy. *Data based on DALYs and labor market participation, 2025 projections.** $40k–$60k per patient-year. ***assuming $150 per scan. 17 If you measure it, you can shape it! The high socioeconomic burden of cardiovascular diseases (CVDs) indicates that reducing the burden is essential In Europe, CVDs is estimated to generate a social burden equivalent to 4-5 % of GDP*. In the Baltic States this equals €6 – 8 billion annually. If we prevented just half of all CVD events → we would increase Baltic wealth by 2 – 2.5 % of GDP A €20 million prevention program in Estonia alone creates €127 million in societal value over 15 years = 7.75× return and 315 lives saved**. *Estimate based on results from Luengo-Fernandez et al. (2023) on the economic burden of CVD in the EU (2024), adapted using WifOR’s methodology. While Luengo-Fernandez et al. (2023) calculate direct costs (health, social, informal care) and productivity losses (valued with average earnings), our approach builds on DALYs to capture the full potential productivity loss in terms of paid and unpaid work, valued via GVA, and includes indirect and induced economic effects. This adaptation results in an estimated GDP impact of 4–5%, compared to 2% in the original study. **Estimations consider the forecasting of the country's economic development during the first 15 years after starting the P-CVD program. Source: WifOR Elaboration. HernandezVillafuerte,et al.. 2025.The Health ROI Assessor: Evaluating Novel CVD Prevention Approaches in Estonia. Value & Outcomes Spotlight March/April 2025, pp 31-34 18 If you measure it, you can shape it! 4 ROI and Societal Impact WifOR‘s Health ROI Assessor Framework The Social Impact of Health Additional details in Hernandez-Villafuerte, 2025 20 If you measure it, you can shape it! Macroeconomic value of a Cardiovascular Disease Prevention Program in Estonia. Short term – Base case scenario HE footprint Figure 5. Cumulative GVA Value Created via the HE Footprint ▪ An investment of €20 mio over five years generates in terms of direct, indirect, and induced effects during the first 10 years: ▪ € 50 mio GVA value ▪ 1,178 additional workers. Source: WifOR Elaboration. Hernandez-Villafuerte et al.. 2025.The Health ROI Assessor: Evaluating Novel CVD Prevention Approaches in Estonia. Value & Outcomes Spotlight March/April 2025, pp 31-34 21 If you measure it, you can shape it! Macroeconomic value of a Cardiovascular Disease Prevention Program in Estonia. Short term – Base case scenario The Social Impact of Health ▪ By avoiding 315 deaths and 928 non-fatal events, the program generates € 127.04 mio of value in terms of increasing paid (€ 60.1 mio) and unpaid (€ 66.9 mio) work productivity during the first 15 years. Figure 6. Cumulative Gained Productivity – Short Term A. Unpaid Work B. Paid Work Estimations consider the forecasting of the country's economic development during the first 15 years after starting the P-CVD program. Source: WifOR Elaboration. Hernandez- Villafuerte,et al.. 2025.The Health ROI Assessor: Evaluating Novel CVD Prevention Approaches in Estonia. Value & Outcomes Spotlight March/April 2025, pp 31-34 22 If you measure it, you can shape it! Health investments create a positive feedback loop SDG GOAL 9 Build resilient infrastructure, promote sustainable industrialization and foster innovation More Innovation SDG GOAL 8 SDG GOAL 3 Promote sustained, Greater Better Ensure healthy lives and inclusive and sustainable promote well-being for economic growth, full and Wealth Health all at all ages productive employment and decent work for all Source: own illustration. Sustainable Development Goals (UN). 23 If you measure it, you can shape it! Investments in health pay off economically – in addition to health benefits, they secure jobs and generate additional value added HEALTH & WELL-BEING LABOR MARKET & SOCIETY ECONOMY & PRODUCTIVITY ▪ Investments such as ▪ ...but illness is holding back economic ▪ Every euro invested generates vaccinations, screening, and potential. additional added value. innovative treatments prevent ▪ Investing in health secures existing ▪ Investments in health act as an illness and death. jobs and creates new ones. economic stimulus program with a ▪ They improve quality of life measurable return on investment ▪ It prevents productivity losses and and prolong life expectancy... (ROI). recovers millions of working hours. Source: Federal Ministry for Economic Affairs and Energy (BMWE) (2022): Healthcare Industry – Facts & Figures. Results of the Healthcare Industry Accounts, data for 2022. 24 If you measure it, you can shape it! 5 Recommendations How can we turn lost billions into saved lives? 1 VALUE Implement a national “Societal Value Mandate” 2 Introduce long-term ROI-based Horizon budgeting 3 SPEED Accelerate innovation access (WAIT improvement target) 4 PREVENTION Increase prevention investments with guaranteed ROI (retinal disease, CVD & BC) 5 DATA Strengthen Baltic data exchange & EHDS readiness 26 If you measure it, you can shape it! WifOR Institute Joseph-Haydn-Strasse 1 Dr. Malina Müller 10557 Berlin Head of Health Economics Germany | Greece | Latin America | USA +49 30 2325 6665-0 +49 30 2325 6665-95 +49 1511 0580843 [email protected] www.wifor.com Macroeconomic value of a Cardiovascular Disease Prevention Program in Estonia. Long term – Scenario Analysis ▪ The Social Impact of Health Figure 7. Cumulative Gained Productivity in Paid and Unpaid ▪ Age 30 to 39 cohort lifetime Work Activities: 30_39 Cohort (2015 prices). horizon ▪ By enrolling in the PCVD program a cohort of 12,077 individuals between 30 and 39 years old ▪ 28.708 mio productive hours are gained in paid and unpaid activities ▪ Translated into €1,059.65 mio of value creation. Estimations assumes that the economic variables are constant after the first 15 years. Source: WifOR Elaboration. Hernandez-Villafuerte et al.. 2025.The Health ROI Assessor: Evaluating Novel CVD Prevention Approaches in Estonia. Value & Outcomes Spotlight March/April 2025, pp 31-34 28 If you measure it, you can shape it! Saatja: "Agnija Antanovica" <[email protected]> Saaja: [email protected], "Info - RAM" <[email protected]>, [email protected] Teema: [DKIM katki]BA letter to the Ministers of Finance of the Baltic States Kuupäev: 2025-12-29 09:16 Tähelepanu! Tegemist on välisvõrgust saabunud kirjaga. Tundmatu saatja korral palume linke ja faile mitte avada. HOIATUS! See e-kiri võib olla liba-, õngitsus- või pahaloomuline, kuna on saadetud asutusest, kus meiliserver on vigaselt seadistatud. Rohkem infot: KKK | teenusveeb <https://teenused.rit.ee/et/kkk> -> E-post ja kalender. Dear Madam/ Sir, On behalf of the Baltic Assembly, I am pleased to forward the letter and the accompanying presentation to the Ministers of Finance of the Baltic States following the conference “Health as an Investment in Baltic Security and Future” that was held on 12 December 2025 in Riga. During the conference, Baltic parliamentarians, representatives of respective ministries and experts discussed health being a powerful long-term investment. While representatives of the Ministries of Finance were not able to participate in the conference, we would nevertheless highly value their perspectives on several key issues raised during the discussions. We would greatly appreciate your replies by 2 March 2026. Sincerely, BALTIC ASSEMBLY Agnija Antanoviča Secretary General +371 67225178 <http://www.baltasam.org/> www.baltasam.org Citadeles 2-616, Riga, Latvia, LV-1010 <https://www.instagram.com/balticassembly/> <https://www.linkedin.com/company/102912134> <https://x.com/AssemblyBaltic> <https://www.facebook.com/BalticAssembly> <https://www.youtube.com/@BalticAssembly>