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With regard to the impact of health spending on health outcomes, countless people are
liable to error, while most of them are, in many points, by passion or interest, under
temptation to it. Nevertheless, what we commonly call “truth” emerges more readily
from error than from confusion. What is the matter?
Disparities and inequalities in terms of health care spending are large across the world.
For instance, the world’s richest countries spend more than 16 times the amount spent by
the world’s poorest countries - after adjusting the per capita spending rates to
international dollars1. On the whole, the relation between health and wealth is strong
certainly. But this well-documented relation also needs to be qualified, mainly because
the link between health spending and health outcomes calls for two preliminary
comments.
Firstly, an income per capita of I$ 1,000 in 1975 was associated with a life expectancy of
nearly 49 years. Three decades later, life expectancy was almost four years higher at
comparable levels of spending. Clearly this suggests that improved access to prevention,
education and expanded health-service networks – among others -, allows for better
health outcomes for the same level of wealth.
1 . International dollars are derived by dividing local currency units by an estimate of their
purchasing power parity compared to the US dollar.
2
US life expectancy is 78 years. It should also be noted that many countries achieve
higher life expectancy rates with significantly lower spending.
With the same life expectancy as the United States, 78 years, the Cuban government
spending per person on health care is one of the lowest in the world, at $220 in 2006.
There are other cases where high life expectancies are achieved with low spending on
health care. Overall, countries with higher spending generally have longer life
expectancy rates, but there are also many countries that perform nearly as well with
much lower spending.
References
1) Deaton A. Global patterns of income and health: facts, interpretations, and policies. Princeton
NJ, Princeton University Press, 2006.
2) Marmot M. Achieving health equity: from root causes to fair outcomes. Lancet, 2007,
370:1153-1163.
3) Starfield B, Shi L. Policy relevant determinants of health: an international perspective. Health
Policy, 2002, 201-218.
4) The World Health report 2008. Primary health care: now more than ever. Geneva. World
Health Organization, 2008.
5) World development indicators 2007. Washington DC, The World Bank, 2007.
2 . In fact, every I$ 100 per capita properly spent on health seems to correspond to a 1-year
gain in life expectancy at birth.