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Public Expenditures in Health

This article discusses the main principles and challenges in public spending on health, including market failures, identification of beneficiaries, and balancing potential benefits with service delivery capabilities. It also addresses health equity concerns and the problems of implementation such as management, personnel placement, quality of services, and political influence.

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Public Expenditures in Health

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  1. Public Expenditures in Health

  2. Main Principles • Establish Market Failures • Identify beneficiaries of expenditures • Balance potential benefits with ability to deliver services

  3. Health - Market Failures • Public goods (pest control, sanitation, health education) • Externalities (infectious disease control) • Information advantage of doctors • Insurance

  4. Health - equity concerns • Inequities in health status • Inequities in benefits of services

  5. The poor are sicker than other people: Mortality by “wealth”- Brazil, 1996

  6. Incidence of disease by “wealth”India 1992-3

  7. Female 45Q15 by cause of death by income group, China 1987

  8. Health - Problems of Implementation • Management challenge • Personnel placement • Quality of services • Conscientious providers • Maintenance of facilities • Political Influence

  9. Health: Complementarity/ conflict between goals • Public goods - strong complementarity • Primary health care - modest efficiency effects (varies), potentially high equity effects, difficult management • Hospitals - high efficiency, high potential but low actual equity effects, easier management(?)

  10. In Brazil: the poor have worse sanitation facilities... % with no sanitation facilities

  11. …they have less access to safe water...

  12. …and this costs the lives of their children Mortality rate

  13. Health: Complementarity/ conflict between goals • Public goods - strong complementarity • Primary health care - modest efficiency effects (varies), potentially high equity effects, difficult management • Hospitals - high efficiency, high potential but low actual equity effects, easier management(?)

  14. Determinants of infant mortality

  15. Philippines: Effect of public medical care Poor area Not-so-poor area

  16. Substitution between public and private providers

  17. Distribution of health care subsidies, Indonesia

  18. Health: Complementarity/ conflict between goals • Public goods - strong complementarity • Primary health care - modest efficiency effects (varies), potentially high equity effects, difficult management • Hospitals - high efficiency, high potential but low actual equity effects, easier management(?)

  19. Value of insurance as a % of expected cost

  20. Priorities in health policy

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