Healthy people drive strong economies


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Waiting to be seen by the midwife at the postnatal ward in the Kuntair Minor Health Center, the Gambia. © Anugraha Palan/World Bank

Dieynaba Nioula Kane remembers vividly when, for the first time in her life, she was forced to ask friends and family for money. It was out of desperation after the birth of her fifth child, a little boy with a life-threatening condition that needed specialist treatment in the capital. Dieynaba was forced to leave her job teaching French and hurriedly relocate to Dakar, where she was able to find the health services he needed.

But the expenses quickly piled up. Hospital bills, a tracheostomy, medicines, dressings, fees for nurses and doctors, plus the cost of food and transportation to and from the hospital. As she took a break from paid employment for four years to focus on her son’s health her family’s economic conditions deteriorated. It took the family years to recover.

Country health systems built on the principles of Universal Health Coverage (UHC) ensure that all people have access to the quality essential health services they need without suffering financial hardship. They enable the good health for children to thrive at school and for adults to be productive at work. They also prevent catastrophic expenses for families.

Financing UHC efficiently and equitably is important to ensure inclusive growth—especially since the health sector accounts for 11 percent of global GDP.  Japan, the current President of the G20, credits its own adoption of a UHC-based system in 1961 for the decades of social and economic development that followed.

This weekend at the G20 Summit in Osaka, the World Bank Group will publish a new report that explains how people in developing countries, just like Dieynaba, spend half a trillion dollars on direct healthcare costs each year. This burden falls most heavily on the poor who spend a larger proportion of their meagre budgets dealing with health crises because they are not covered by a universal healthcare system like the UK’s NHS.

For individuals who live without this protection, the impact is catastrophic—every year, out-of-pocket medical bills result in 100 million people like Dieynaba living in extreme poverty.

For societies and economies, the big improvements in health of recent decades are at risk. Economic growth is stifled by a less productive workforce. And we are all more exposed to the pandemic disease outbreaks that can spread rapidly in an interconnected world.

Part of the reason is that developing countries don’t spend enough on health. By 2030, we estimate that the world’s 54 poorest countries will have a funding gap of US$176 billion per year between what they have and what they need for decent, affordable health services.  Unfortunately, however, the problem goes deeper than not enough money. Between 20 and 40 percent of health spending in developing countries is wasted or used inefficiently, and low-income countries are also starting to face the challenges of an aging population and an increase in chronic, non-communicable diseases.

Together, these factors will drive an upward spiral of healthcare costs which will further burden the poor and create a disastrous recipe for potential health and economic setbacks in the coming decades. It is in the interests of the whole world to guard against economic risks, and we owe thanks to the government of Japan for putting this on the agenda of the G20.

"Financing UHC efficiently and equitably is important to ensure inclusive growth—especially since the health sector accounts for 11 percent of global GDP."
Kristalina Georgieva's picture
Kristalina Georgieva
Chief Executive Officer of the World Bank

The solutions start with budget decisions made by countries themselves. Enlightened finance ministries will see investments in their citizens as central to their future growth and prosperity in an economy that will increasingly value workers with higher order cognitive skills. In other words, a healthier workforce will be a more competitive workforce.

The World Bank has been working with countries through its Human Capital Project to increase such investments, including in health, which is currently as low as 3 percent of some countries’ budgets.

When it comes to improving how budgets are to spent there are proven strategies that deliver better more bang for the buck. For example, improved primary healthcare services and community health are likely to reach more vulnerable people in remote places. Similarly, taxing tobacco, alcohol and sugary drinks raises revenue and improves general health across the population.

International assistance is also an important part of the equation. The UK’s leading commitment to development assistance and work through joined-up innovative efforts have been key to many recent developing country health gains like improved immunization, treatment for HIV-AIDS and better maternal and child health and nutrition. And investing in effective health systems at a country level has a positive payback loop for donors in areas like limiting the spread of infectious diseases.

In even the most optimistic scenario, however, boosting country and donor investments in health would only cover half the 2030 health financing gap in developing countries. New approaches are needed for people like Dieynaba to avoid the health trapdoor that plunges them into poverty.

For example, tapping into a fraction of the pernicious half trillion dollars per year currently spent on pay-as-you-go healthcare represent frontier investment opportunities for pre-paid and pooled health financing. This would be a good first step to protect all people’s health -- and their household budgets – in a way that drives better health and inclusive growth.

This post was originally published on LinkedIn.


Join the Conversation

Patricio V Marquez
July 08, 2019

Great blog by Kristalina as UHC is a right for all to develop health capital and hence human capital and total wealth in countries. And taxing tobacco, alcohol, and sugary drinks is a win win win policy measure for public health, domestic resource mobilization, and equity given its progressivity.

Mohamed Saleh
July 17, 2019

The United Nations’ Global Goal 3 focuses on achieving good health and well-being for all — and vaccines, which save millions of lives every year,
Manufacturing an invention for implement the completion of vaccines for all persons in isolated areas and remote villages, That depends on establishment of a complete transport network without accidents, by implementing the inventions that contribute to that. Spreading health awareness and treating the spread of diseases among people needs an accident-free transport to reach populations in distant remote places so as not to be a center of contagion all over the world as has been the case before for AIDS and Ebola where it started in Africa and then spread everywhere. Because the lack of safe transportation prevents access to those for complete the full immunizations,
Africa, where many poor people live in remote villages far from urban areas However, For poverty reduction to women’s for economic and social inclusion: there are no luminous roads that allow safe travel at night to specialized medical personnel to implement full immunizations against diseases and spread health awareness among these poor communities who do not have the money to travel to hospitals in distant cities, Especially children who are ill, who are unable to move and pregnant women who cannot afford the risk of traveling on rough non-luminous roads at night, very overcrowded during the day, Also it's making sure women have access to live-saving medicines during childbirth, ensuring their children are protected against preventable diseases, On top of the daily dose of unfair treatment, women continue to suffer from limited access to vital sexual and reproductive health resources like safe contraception and birth medicines. The lack of these protections not only risks women’s lives but also prevent women from finishing education or following their career aspirations.
Too many women are dying in childbirth, often from entirely preventable causes. Simple medicines can save the lives of mothers and their children, but for women living in conflict zones, displacement camps, or poverty, this basic access is out of reach. Because they are poor, they do not have the money to travel to hospitals in the main cities because they are accused of living in remote villages where there are no luminous roads to travel safely without accidents during the night long distances for the treatment or birth in the morning, but forced to surrender to death in their homes. Even if they return, they are liable to die with their children at night accidents on the roads because of the lack of good illumination after all this effort and pains.
I’m from Egypt at Africa, I have two inventions were implemented to develop the night lighting system, patents No, 26771 year 2011 (Extra Spotlights through Xenon, Laser or LED Bulb) and patent No, 29238 year 2014 (A device that provides powerful lighting for all types of vehicles using lights tubes without dazzled) from, Academy of Scientific Research in Cairo Egypt. Towards reduce the killing of, One million and 350,000 human beings annually in road accidents they are killed (3500 daily) death cases occurs daily worldwide also Every 6 seconds someone, somewhere in the world is suddenly and tragically killed because of injury, Their total amounts to five million deaths annually! (Even if the accident reduction rate is 10% the lives of 350 people will be preserved daily), also causing losses of 500 billion US dollars (If a 10% halt occurs, $ 50 billion will be available to change the world's economy)
To development of night lighting system currently used in all vehicles to reduce night accidents, environmental pollution for the light, To increase and enhance night vision and control the orientation of light dazzled (where only control available now is to turn the light on or off) there has been no any development since invention of first car in 1886 to now, Which kicks off light speed by 300,000 m/s, to hit the optic nerve force of the person or animals are not qualified to bear this strong blow and cannot tolerate and temporary blindness is the main reason to increase nighttime accidents.
Is done by installation inside body vehicle to the rear is far from the front, to control such glow on, then redirected to the front for radiate through fiber-lights and other luminous elements, They are installed inside the projector at specific angles and degrees to control the direction of light away from the vision of others.
This invention also contributes strongly to travel insurance for long distances on roads at night where there is no lighting, for vehicles equipped to donate blood, which has blood quality analysis laboratories and preserves and then return to the blood banks in the main cities To reach blood donors in communities that live in remote places away from urbanization because they are poor people who do not have the money to travel to the blood donation banks in the main cities, which contributes strongly to increase the blood yield and save many lives.

Nura haruna
July 17, 2019

I will sport this conversation

Sampha bangura
July 08, 2019

It is very good to have you

Masixole Ntunguntwana
July 08, 2019

Thanks for the article and I shall take time and read it

Joel Soares Mujovo
July 08, 2019

It's interesting approach.
I am a citizen living in a developing country, Mozambique to be more precise. what I have seen in the national health system, are three aspects:
First, there is no equity in investment for health. Most of the investment in health is allocated to "big cities" where, ironically, there are better conditions of health in comparison with peripheral areas. This means that in times of need people will have to travel long distances from the countryside to the cities (abandoning their activities or jobs):
Second, robbery and corruption in hospitals. The medicines labeled for the exclusive use of the public health system are sold in private pharmacies or by doctors in hospitals in the light of day. In contrast, the public pharmacies have no medicines. (...)
Third, Poor care. Health professionals do not respect the patient in public hospitals. In a hospital queue one patient may get illness from the other or even die waiting for the doctor who is having breakfast.
I will not exhaust the problems of the national health system, because I would write 500 pages.
From my point of view, these problems can be minimized by investing in the quality of education. Quality education is the basis for resolving all these problems of applying investment in health, corruption, mismanagement, among other problems.
We must stop pursuing quantitative goals in education, and it is necessary to develop qualitative goals (it is better to graduate 20 excellent professionals per year than 1000 bad ones per month).

Umuhoza Ernestine
July 08, 2019

In your report, try to show countries with worst health conditions and the main causes of the problems, because external aid may be a priority and solution but not be for another country as the main causes may differ. For example for one country prevention may be a solution rather than investing in health services.

Abdurrasheed shehu shanono
July 08, 2019

Very educative write up thanks

Abdurrasheed shehu shanono
July 17, 2019

Very educative write up thanks

Gift Gumbira - WBG PFM Consultant
July 17, 2019

Great contribution, indeed!