The Ministry of Health and the Ministry of Finance are investigating multimillion-crown severance payments made to former managers at the Health Insurance Company of the Ministry of the Interior (Zdravotní pojišťovna ministerstva vnitra), according to reports from iRozhlas.cz and Český rozhlas Radiožurnál. Health Minister Adam Vojtěch stated the ministry is prepared to file a criminal complaint to determine if the payments constituted a crime, such as the breach of duties in the administration of foreign property.
Severance Payments and Managerial Exits
Between 2023 and last year, several high-ranking officials received substantial payouts upon leaving the insurer. Former executive director Otakar Smolík received 23.4 million crowns, while personnel department head Lýdie Jaroměřská received nearly 21 million crowns, according to iRozhlas.cz.
Other significant payments included 9.3 million crowns to Martina Brzobohatá, former head of the general director’s office, and approximately 6.1 million crowns to Edita Vágnerová, a former advisor to the performance department director. Former general director David Kostka, who resigned at the end of April, received 3 million crowns in severance.
Did You Know? The Health Insurance Company of the Ministry of the Interior is the second largest of its kind in the Czech Republic, serving 1.354 million insured persons.
Ondřej Felix Reforms Managerial Contracts
General Director Ondřej Felix, who took office in May, has abolished the position of executive director and is removing non-compete clauses from managerial contracts. Felix told Zdravotnický deník that these clauses were used to pay out additional millions and that the insurer is now returning to “absolute standards” regarding severance.
“Since my appointment, we have already canceled most of the non-compete clauses and we continue to revise the labor law conditions,” Felix stated. He confirmed that new non-compete clauses are fundamentally no longer being negotiated.
Financial Losses and Systemic Deficits
The insurer has faced significant financial losses for several years. In 2022, it reported a deficit of 712 million crowns; in 2023, the deficit was 485 million crowns; and the year before that, it reached 916 million crowns.
This reflects a broader trend in the Czech Republic, where all seven health insurance companies operated at a loss between 2022 and 2024. The public health insurance system, which manages approximately 560 billion crowns this year, has been distributing more money than it collects from premiums and state contributions, forcing insurers to draw from previous reserves.
Potential Legal Consequences
Minister Adam Vojtěch described the potential unjustified payment of millions from public funds during a financial crisis as a “scandalous and inexcusable failure” on social media platform X. Legal action may follow if the investigation confirms these payments were baseless.
While the Ministry of Health considers criminal reports, former officials David Kostka, Otakar Smolík, and Lýdie Jaroměřská have not responded to requests for explanation.
Frequently Asked Questions
Who investigated the severance payments?
The Ministry of Health and the Ministry of Finance are currently reviewing the payments.
How much did the highest-paid former managers receive?
Otakar Smolík received 23.4 million crowns and Lýdie Jaroměřská received nearly 21 million crowns.
What changes did Ondřej Felix implement?
Felix abolished the executive director position, canceled most existing non-compete clauses, and stopped negotiating new ones to return the insurer to standard payment practices.
Should public insurance companies be subject to stricter limits on managerial severance during years of financial deficit?
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