About 100 million people worldwide are pushed into extreme poverty each year by health spending, despite government coverage of an average of 51 percent, the World Health Organization (WHO) said on Wednesday.
In its latest report, the WHO reveals that health spending is growing faster worldwide than the rest of the global economy, accounting for 10 percent of global gross domestic product (GDP). The trend of rising health spending is particularly noticeable in low- and middle-income countries, where health spending is growing on average 6 percent annually compared with 4 percent in high-income countries. However, with more than 35 percent of health spending per country coming from out-of-pocket expenses, or people paying for their own care, about 100 million people are pushed into extreme poverty each year.
According to the WHO, health spending is made up of government expenditure, out-of-pocket payments and sources such as voluntary health insurance, employer-provided health programs and activities by non-governmental organizations. The report highlights a trend of increasing domestic public funding for health in low- and middle-income countries and declining external funding in middle-income countries. Reliance on out-of-pocket expenses is declining around the world, albeit slowly. “Increased domestic spending is essential for achieving universal health coverage and the health-related Sustainable Development Goals,” said WHO Director General Dr. Tedros Adhanom Ghebreyesus. “But health spending is not a cost, it’s an investment in poverty reduction, jobs, productivity, inclusive economic growth, and healthier, safer, fairer societies.”
The report finds that in middle-income countries, government health expenditure per capita has doubled since the year 2000. On average, governments spend 60 U.S. dollars per person on health in lower-middle income countries and close to 270 U.S. dollars per person in upper-middle income countries. When government spending on health increases, people are less likely to fall into poverty seeking health services. But government spending only reduces inequities in access when allocations are carefully planned to ensure that the entire population can obtain primary health care. In low- and middle-income countries, new data suggest that more than half of health spending is devoted to primary health care. Yet less than 40 percent of all spending on primary health care comes from governments.
The report also examines the role of external funding. As domestic spending increases, the proportion of funding provided by external aid has dropped to less than one percent of global health expenditure. Almost half of these external funds are devoted to three diseases: HIV/AIDS, tuberculosis and malaria. The new WHO report points to ways that policymakers, health professionals and citizens alike can continue to strengthen health systems, while also calling on WHO member states to prioritize spending on quality healthcare in the community.