OECD report finds reduction in spending on health

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Spending on health fell in one of three countries covered by the Organisation for Economic Co-operation and Development (OECD) between 2009 and 2011, with the countries hit hardest by the financial crisis witnessing the biggest cuts.

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In its report ‘Health at a Glance 2013’ the Secretary-General of the OECD finds that growth in spending on health has slowed markedly in almost all 34 OECD member countries since 2008. After years of continuous growth of over 4% per annum, average spending on health across the OECD grew at only 0.2% between 2009 and 2011. Total health spending fell in 11 out of the 34 OECD countries between 2009 and 2011.

Greece and Ireland experienced the sharpest declines, with per capita healthcare spending falling by 11.1% and 6.6%, respectively, between 2009 and 2011. Growth in spending on health also slowed significantly in Canada (0.8%) and the US (1.3%). In fact, the only countries in the OECD to have escaped a decline are Israel, Japan and Korea. In Israel (3.4%) and Japan (4.9%) growth in spending on health has accelerated since 2009 and in Korea growth has continued at more than 6% per year since 2009, albeit at a slower rate than in previous years.

In order to limit or reduce public health expenditures, countries have worked to lower the prices paid for publicly financed health care, including cutting the price of medical goods, particularly pharmaceuticals. Governments have also targeted hospital spending through budgetary restrictions and cuts to wages.

Further, in several OECD countries, patients are now expected to assume a greater share of health costs, with co-payments for pharmaceuticals in particular being increased.

The news that spending on health is being reduced is perhaps not surprising, in the light of the financial crisis, and has been reinforced by an EU report in 2010, which also found reductions in spending on health in 24 Member States of the EU [1].

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Reference

1.  GaBI Online - Generics and Biosimilars Initiative. EU health spending in 2010 decreases for first time since 1975 [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2013 Dec 6]. Available from: www.gabionline.net/Reports/EU-health-spending-in-2010-decreases-for-first-time-since-1975

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Source: OECD

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