November 22, 10

NEWS / New UN report urges measures to ensure affordable health services for all

22 November 2010 – The United Nations health agency today mapped out what countries can do, including raising more funds and spending it more efficiently, to ensure that everyone who needs health care can access it despite rising costs.

The World Health Organization (WHO) notes that Governments worldwide are struggling to pay for health care, which is rising as populations get older, as more people suffer chronic diseases, and as new and more expensive treatments appear.

It says that in countries that depend heavily on people paying directly for services at the point of delivery, health bills push 100 million people into poverty each year.

In its annual World Health Report, the agency shows how all countries, rich and poor, can adjust their health financing mechanisms so more people get the health care they need. It highlights three key areas where change can happen – raising more funds for health, raising money more fairly, and spending it more efficiently.

“No one in need of health care should have to risk financial ruin as a result,” said WHO Director General Margaret Chan. “The report sets out a stepwise approach. We encourage every country to act on this and do at least one thing to improve health financing and increase health coverage over the coming year.”

WHO says that in many cases, governments can allocate more money for health. In 2000, African heads of State committed to spend 15 per cent of government funds on health, a goal that three countries – Liberia, Rwanda and Tanzania – have already achieved.

If the governments of the world’s 49 poorest countries each allocated 15 per cent of state spending to health, they could raise an additional $15 billion per year – almost doubling the funds available, notes the agency.

Countries can also generate more money for health through more efficient tax collection, says WHO, which cited as an example Indonesia, which has boosted revenue by 10 percentage points.

They can find new sources of tax revenue, such as sales taxes and currency transactions, as in the case of Ghana, which funded its national health insurance partly by increasing the value-added tax (VAT) by 2.5 per cent. A review of 22 low-income countries shows that they could between them raise $1.42 billion through a 50 per cent increase in tobacco tax.

WHO also cites the role of the international community, noting that if all donors joined Norway and others that have kept their promise to allocate 0.7 per cent of gross domestic product (GDP) to official development assistance, three million additional lives could be saved in lower-income countries by 2015.

The report highlights the model used by countries such as Japan, Chile, Rwanda and Thailand, which have reduced dependence on direct, out-of-pocket payments and increasing prepayment – generally through insurance or taxes or a mix of the two. The funds raised are then pooled so that it is not just those who get sick that bear the financial burden.

Smarter spending could also boost global health coverage anywhere between 20 and 40 per cent, the agency points out, highlighting 10 areas where greater efficiencies are possible, including the use of generic drugs wherever possible – a strategy that saved almost $2 billion in 2008.

WHO is presenting its report today to a ministerial conference on health financing, held in Germany. The agency and its partners will then embark on a programme to help countries review their health financing systems and strategies, facilitate exchanges of experiences between countries, and help countries adjust financing systems so that more people get access the services they need.

http://www.un.org/apps/news/story.asp?NewsID=36827&Cr=world&Cr1=health