WHO urges governments to strengthen health financing so more people can use services

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WHO urges governments to strengthen health financing so more people can use services

2010-11-22 21:12:31 GMT+7 (ICT)

BERLIN (BNO NEWS) -- The World Health Organization (WHO) on Monday urged governments worldwide to strengthen health financing so that more people are able to use health services.

The WHO presented its 2010 World Health Report to a ministerial conference on health finance which is being hosted by the German government in Berlin. It gives governments practical guidance on ways to finance health care, taking examples from around the world.

"Even in countries where health services have traditionally been accessible and affordable, financing mechanisms are increasingly stretched," the WHO said. "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."

The global health organization believes that all countries, rich and poor, can adjust their health financing mechanisms so more people are able to get the health care they need. It also urges the international community to support low and middle-income countries' efforts to increase health coverage.

"No one in need of health care should have to risk financial ruin as a result," said Dr Margaret Chan, Director General of WHO. "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."

The WHO highlighted three key areas where it believes that governments can make changes by raising more funds for health, raising money more fairly, and spending the money it raises more efficiently.

It said that in many cases, governments are able to allocate more money for health. For example, in 2000, African heads of state committed to spend 15 percent of government funds on health. This has so far been achieved by Liberia, Rwanda and the United Republic of Tanzania, and the WHO believes that governments of the world's 49 poorest countries should also do this, in effect doubling the funds available.

They can also generate more money for health through more efficient tax collection, as Indonesia has done, raising revenue by 10 percent. They can find new sources of tax revenue, such as sales taxes and currency transactions. Ghana, for example, has funded its national health insurance partly by increasing the value-added tax (VAT) by 2.5 percent. A review of 22 low-income countries shows that they could between them raise $1.42 billion through a 50 percent increase in tobacco tax. India could generate $370 million per year by implementing a levy of just 0.005 percent on foreign exchange transactions.

The WHO also said that the international community has a key role to play, saying that an average of $44 per capita is required to ensure access to even a small set of quality health services in low income countries. "Many struggle to do this," it said.

According to recent statistics, 31 countries spend less than $35 per person on health. "If all donors joined the government of Norway and others that have kept their promise to allocate 0.7 percent of gross domestic product (GDP) to official development assistance, three million additional lives could be saved in lower income countries by 2015," the WHO said, urging countries to give more.

The WHO also called on governments to raise money more fairly and removing key financial barriers to obtaining care. For example, countries such as Japan manage to ensure health services are available to everyone by reducing its 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 are unlucky enough to get sick that bear the financial burden. "This is the model used in many European countries, with Chile, Colombia, Mexico, Rwanda, Thailand and Turkey all making significant progress in the last decade - along with Brazil, China, Costa Rica, Ghana, Kyrgyzstan and the Republic of Moldova," the WHO said.

Finally, the WHO further urged countries to spend the money it raises for health more effectively which could increase global health coverage by between 20 to 40 percent. The report identifies ten areas where greater efficiencies are possible.

One of these is the purchasing of medicines. France, for example, adopted a strategy of using generic drugs wherever possible - this saved the equivalent of almost $2 billion in 2008 alone.

Further, hospital care often absorbs between half to two thirds of total government spending on health. However, some $300 billion is lost every year due to hospital-related inefficiency. "More efficient spending on hospitals could boost productivity by 15 percent," the WHO said.

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