Fiscal Sustainability of Health Systems

Bridging Health and Finance Perspectives

image of Fiscal Sustainability of Health Systems

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.



Fiscal sustainability of health systems – Why is it an issue, what can be done?

This chapter describes the fiscal sustainability challenge faced by OECD country health systems, and how it can be addressed. It analyses trends in health expenditure, showing that health spending has typically outpaced economic growth in the past. Although the global financial crisis of 2008 moderated health spending growth, projections forecast health spending to continue to rise as a share of GDP. Evidence on the key drivers of health spending are then presented, showing that it has been largely driven by new technologies and rising incomes, with demographic change (ageing) and institutional characteristics of health systems also important in some countries. Three general policy options for ensuring the fiscal sustainability of health systems are then discussed: raising more money for health, improving the efficiency of government health spending, and reassessing the boundaries between public and private spending.



This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error