This Selected Issues paper focuses on financial challenges faced by Slovenia in its health sector. Healthcare and long-term care expenditures are projected to rise significantly in Slovenia over the medium and long term, primarily due to rapid population aging. This paper analyzes the financial pressures facing Slovenia’s health sector, driven primarily by rapid population aging and a financing system that has not fully adjusted to these structural shifts. Slovenia exhibits one of the steepest aging trajectories among EU and Organisation for Economic Co-operation and Development countries, creating a dual challenge: rising demand for healthcare and long-term care is intensifying expenditure needs, while a shrinking workforce is weakening revenue flows into the social health insurance system, the main source of sector financing. Although reforms are underway, additional measures are essential to reduce long-term fiscal risks. Key priorities include strengthening and diversifying the financing structure, improving efficiency, and accelerating policies that support active aging. Together, these reforms would help contain cost pressures, preserve equitable access to quality care, and ensure the long-term sustainability of the health system.