Who Pays for Health? Global Health Financing Today and Tomorrow

| November 15, 2012 | 0 Comments

By Jonathan Quick, MD, MPH and Angie Lee, MPH

Image credit: Town of Matthews, NC.

Baby Janelle, a two-year old living outside Kampala, Uganda, falls sick with cough, vomiting and fever. Her single mother, a day laborer in the stone quarries, is forced to choose between taking Janelle to the health center – for which she must pay herself – and paying school fees for her other two children. Jonathan is a two-year old with pneumonia living in Manila, Philippines. Because his family is among the poorest quintile, they are covered by Philippine National Health Insurance scheme. Without hesitation, Jonathan’s mother takes him to the nearest health center and receives treatment.

Everyone deserves an opportunity for good health. Too often who receives needed care – and who lives or dies – depends greatly on who pays. Most high income countries spend at least $3000 per person per year on health. Over 80% of this is from taxes, national health insurance, employer-sponsored health plans, or other collective sources. In contrast, most developing countries spend less than $100 per person per year and in the worst cases, as little as $20 per person per year. In Africa and Asia out-of-pocket health spending accounts for 50-80% of total health expenditures. Like Janelle’s mother, families are often forced to choose between seeking care at an impoverishing cost, or letting a loved one fall into a down- ward spiral of illness and premature death.

Against this global health financing landscape, the decade of the 2000s produced a dramatic and unprecedented outpouring of financial commitments from high income donor country governments and private sources such as The Bill and Melinda Gates Foundation. From 2002 to 2008, roughly $80 billion was committed – largely in support of AIDS, tuberculosis and malaria, and to a lesser extent for maternal and child health. For many donors, the global recession that started in 2008 has markedly slowed this trend. The absolute value of total development spending on health continues to rise. But looming budget pressures in donor countries threaten future commitments.

As the economies of traditional donor countries struggle and their development assistance funding wanes, many emerging economies in Africa, Asia and elsewhere are experiencing economic growth. With growth comes greater demand for health services and increased local spending for health. The challenge is to channel increased spending to achieve the greatest health impact. More than 20 developing countries, including India, Ghana, Mexico, Rwanda, Thailand and Vietnam, are responding by pursuing a vision of universal health coverage (UHC). Based on principles of equity and human rights, UHC shares the risk of ill health (“pooling”) so the healthy help pay for the sick, and the rich for the poor. The funding mix differs among countries, with varying combinations of general taxes, social health insurance social, community health insurance, and employer-based financing.

Just as the global economic and health financing picture is changing, so too is the epidemiologic picture. The World Health Organization projects that between 2004 and 2030, chronic non-communicable disease (NCD) deaths in low income countries will double to 18 million per year. The need for prevention, care and treatment will escalate accordingly. In this context the dictum, “More money for health and more health for the money,” requires that we seek both innovative mechanisms for health financing and build strong health systems that achieve the greatest impact with available funds.

New leaders in global health must expand the existing health !nancing mechanisms, while pursuing innovative health financing. Examples include developing the economic advocacy skills of national health leaders to garner adequate health funding from their national budget-keepers, performance-based financing to increase ecient use of funds, the UNITAID creation of Brazil and France that has generated over $1 billion for global health from airline ticket fees, use of crowd-funding to engage ordinary citizens in donating to a health equity fund that protects poor Pakistanis from catastrophic health spending, and licensed brand Product Red that rock-star activist Bono co-founded to help !nance the Global Fund. A common feature of such innovations is that – in addition to medicine and other health professions – they draw on a variety of talents and disciplines, including economics, systems engineering, communications, and social media.

For every Janelle and Jonathan in the world, the opportunity to pursue long life and good health should not be an accident of birth. It should a matter of realizing their human rights through adequate and equitable health financing.

Tags: , , , , , ,

Category: Features, Policy, Print

About the Author ()

Leave a Reply