On February 1st, India’s finance minister presented the Union Budget for 2017-2018, and announced the government’s plan to eliminate tuberculosis (TB) by 2025. This is a welcome move. While ridding people of the burden of any disease is a worthy goal by itself, TB elimination provides perhaps one of the strongest cases for public intervention from an economic point of view.
All communicable diseases present what economists call externalities: infectious people can infect other people who in turn infect others and so on. In fact, economist Phillip Musgrove used TB in particular to illustrate this: “no victim of tuberculosis is likely to ignore the disease, so there is no problem of people undervaluing the private benefits of treatment. Rather, the cost of treatment--and the fact that they may feel better even though the disease has not been cured-- may lead people to abandon treatment prematurely, with bad consequences not only for themselves but for others. The rest of society therefore has an interest in treating those with tuberculosis, and assuming at least part of the cost.” Reducing TB incidence could generate benefits of $33 per dollar spent, prompting The Economist to put TB among their list of ‘no-brainers’. According to the Stop TB Partnership, ending TB globally could yield US$ 1.2 trillion overall economic return on investment.
Back in the 1930s, Sri Lanka thought it would be a good idea to give everyone free access to health care. More than 75 years later, as the global health community bangs the drum for universal health coverage (UHC), Sri Lankans can be forgiven for letting out a yawn and wondering what all the fuss is about. But as shown by a workshop organized in Colombo last week to mark the first World UHC Day, the concept of universal health coverage (“all people receive the health services they need without suffering financial hardship”) does still have relevance here.
Start with the history. By 1960 Sri Lanka’s health indicators were already well above the curve for its income level, and it was close to having the best health outcomes in developing Asia. It started the MDG era in 1990 with a level of child mortality that was lower than where most Asian countries – including Vietnam, Philippines, Indonesia, and its South Asian neighbors India, Pakistan and Bangladesh – will finish it in 2015. Vaccination rates are above 99%. And all this was achieved without results-based financing, conditional cash transfers, or today’s other proposed silver bullet solutions for improving health.