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Fiscal Sustainability of Health Systems

Bridging Health and Finance Perspectives

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The health systems we enjoy today, and expected medical advances in the future, will be difficult to finance from public resources without major reforms. Public health spending in OECD countries has grown rapidly over most of the last half century. These spending increases have contributed to important progress in population health: for example, life expectancy at birth has increased, rising on average by ten years since 1970. The challenge now is to sustain and enhance these achievements in a context of tight fiscal constraints in many countries combined with upward pressure on health spending from factors such as new technological advances and demographic changes. Finding policies that can make health spending more sustainable without compromising important achievements in access and quality requires effective co-operation between health and finance ministries. Sound governance and co-ordination mechanisms are therefore essential to ensure effective policy choices. Prepared by both public finance and health experts, this report provides a unique detailed overview of institutional frameworks for financing health care in OECD countries. One of the main features of this book is a comprehensive mapping of budgeting practices and governance structure in health across OECD countries.

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Decentralisation of health financing and expenditure

In a majority of OECD countries, sub-national governments (SNGs) play some role in health-care spending. The allocation of health care expenditure between central, state and local levels has significant repercussions over the design, financing and sustainability of health care systems. This chapter gives an overview of health care decentralisation in OECD countries, and analyses the main differences in spending allocations between levels of government, as well as revenue distribution (taxes, transfers, etc.). It also focuses on recent reforms in OECD countries devolving further responsibilities for health expenditure to sub-national governments.

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