“The Swedish health care system is primarily funded through taxes (Fig. 3.5). Both the county councils and the municipalities levy proportional income taxes on their respective populations. The financing of health care services by local taxes is supplemented by the central government and by user charges. Subsidies for dental care are paid for by national social insurance, and the Swedish Social Insurance Agency generates revenues primarily through employer payroll fees (Fig. 3.6). Subsidies for prescription drugs are paid for through designated state grants to the county councils and then treated as a restriction on the county councils’ fee revenues (section 3.4). As the financial and political responsibility for health care is decentralized to the county councils, it is difficult to make precise connections between the sources of finance and different activities within the county councils. Most county council activities are financed through county tax revenues, but county councils are also responsible for other activities, such as regional transportation and cultural activities.

“County council revenues amounted to SEK 257 billion (€29 billion) in 2009, where 71% originated from local taxes (SALAR, 2010a). County councils and municipalities also receive subsidies and state grants, which are financed through national income taxes and indirect taxes. State grants can be either general or targeted. General grants are paid per inhabitant and are designed to contribute to equalization across local governments with different tax bases and different spending needs. They are based on a formula that partly re-allocates resources across municipalities and county councils with the aim of giving different local government bodies the opportunity to maintain similar standards, irrespective of differences in average income and/or need (see section 3.3.3 Pooling of funds). Each municipality, county council or region can use this money on the basis of local conditions. Targeted grants must be used to finance specific activities, sometimes over a specific period of time. The major part of the subsidies takes the form of reimbursements for pharmaceuticals listed in the Drug Benefit Scheme. Sources of revenue have been stable over the past decade (Table 3.4).”

Source: Anell A, Glenngård AH, Merkur S. Sweden: Health system review. Health Systems in Transition, 2012, 14(5):1–159.
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