Health financing
In 2015, WHO Member States endorsed a resolution urging governments to develop health financing systems aimed at attaining and maintaining universal coverage. The main purpose of health financing is (1) to make funding available, (2) set the right financial incentives to providers, and (3) ensure that all individuals have access to effective public health and personal health care.
Strengthening health financing is one objective of Sustainable Development Goal 3 (Ensure healthy lives and promote well-being for all at all ages) – SDG target 3.c. The levels and trends of health expenditure data identify key issues (weaknesses and strengths) and areas that need investment to improve health facilities. Health expenditure data is also used to improve health information systems and increase capacity for trained and skilled human resources in the health workforce. In line with SDG 3.8, health financing is critical for achieving universal health coverage (UHC) based on the principle that all people should have access to the quality health services they need without suffering financial hardship.
Globally, health spending continues to rise, reaching USD 7.9 trillion in 2017 or about 10% of the GDP and USD 1,080 per capita – increased from USD 7.6 trillion in 2016.
- USD 4.8 trillion (60.7%) of government health spending
- USD 1.6 trillion (20.6%) of prepaid private spending
- USD 1.5 trillion (18.5%) of out-of-pocket spending
- USD 40.6 billion (0.5%) of donor financing
Health systems financing and health promotion
Health systems financing can be achieved through:
- Resource mobilization – generating and collecting revenue
- Pooling – combining financial resources from multiple sources to share the financial risk of paying for healthcare
- Purchasing – mechanisms to pay providers for healthcare services
Generally, health promotion financing is still inadequate both in developed and developing countries. Only 3% of total health expenditures on average is dedicated to prevention and health promotion programmes in Organisation for Economic Co-operation and Development (OECD) countries.
There is no single financing system most appropriate across countries. Therefore, careful analysis by all stakeholders is required to find the most cost-effectiveness scheme for each country. This depends on the political, socio-economic and cultural context of the country, the technical and institutional capacity in place, as well as the existing health (financing) system.
References
World Health Organization. (2010). Monitoring the Building Blocks of Health Systems: a handbook of indicators and their measurement strategies. Geneva, World Health Organization. 2010.
Resolution WHA58.33. (2005). Sustainable health financing, universal coverage and social health insurance. World Health Assembly. Geneva, World Health Organization. Available at: http://www.who.int/health_financing/ documents/cov-wharesolution5833
World Health Organization. (2019). Global spending on health: a world in transition. Geneva, World Health Organization.
Bennett S and Gilson L. (2001). Health financing: designing and implementing pro-poor policies. DFID Health Systems Resource Centre, London.
Bayatsaikhan D and Muiser J. (2007). Financing health promotion. Discussion paper, Number 4, 2007. Geneva, World Health Organization.