Denmark will use stronger-than-expected economic growth to boost its healthcare system with an extra 5 billion Danish crowns ($739 million) per year, the country's Prime Minister Mette Frederiksen said on Tuesday.

Danes pay some of the highest taxes in the world to finance their welfare model, which includes universal healthcare. But as the population ages, the country's government is facing a push for higher spending.

Denmark already has the second-highest healthcare spending per capita in the European Union, behind Luxembourg, equivalent to 10.5% of GDP, according to Eurostat.

"The reason we can do this today, give a major boost to our healthcare system, is because the Danish economy is doing better than we had expected," Frederiksen told a press conference.

The Danish economy is experiencing a moderate boom despite headwinds from the COVID-19 pandemic and an energy crisis, characterised by low unemployment and high industrial activity.

Still, the government has sought to keep fiscal spending tight in order to bring down high inflation.

The extra money would partly be targeted at new types of treatment, at cancer treatment, and at addressing geographical and social inequality within the healthcare sector in the country, Frederiksen said.

Cancer treatment has become a thorny issue after recent media reports in Denmark showed waiting times for treatment and surgery had increased. ($1 = 6.7638 Danish crowns) (Reporting by Louise Breusch Rasmussen; Editing by Jacob Gronholt-Pedersen and Alex Richardson)