Healthcare System and Delivery Network

1. Healthcare System and Delivery Network - Growing Geriatric Population and Increase in Life Expectancy Drives Demand for Healthcare

2. Tremendous Variation in Healthcare Expenditure Across Geographies Healthcare expenditure as a percentage of Gross Domestic Product (GDP) has been increasing consistently and differs variably across geographies. An international comparison on healthcare spending in 2008 demonstrated that the US spent significantly higher than any other developed and emerging countries. In 2008, healthcare spending as a percentage of GDP in the US was 16%, it was 11.2% in France, 9.1% in Italy, 10.5% in Germany, 9% in Spain, 8.7% in the UK, 4.7% in China, 5% in India and 8% in Brazil. Japan spent 8.1% of its GDP on healthcare in 2007. An increase in elderly population, a rise in chronic diseases, medical technological advancements, and the growing expectations of patients, have all contributed towards increasing health care expenditures. The global share of health expenditure as a percentage of GDP is likely to increase further as countries recover from the global recession that hit many countries in 2008 and became widespread in 2009. The distribution of health expenditure across the different types of health services and medical goods is influenced by factors such as the availability of hospital beds, health professionals and access to new technology and healthcare providers, as well as by national clinical guidelines and the disease burden within the country.

3. Healthcare Expenditure Per Capita on Public, Private and Out-Of Pocket Payments is Highest in the US The per capita expenditure on healthcare has been consistently higher in the US than in any other industrialized nation. In 2008, per capita spending on healthcare was $7,538 in the US, $3,693 in France, $2,870 in Italy, $3,737 in Germany, $2,902 in Spain and $3,129 in the UK. Japan spent $2,729 per capita on healthcare in 2007. Although healthcare expenditure as a percentage of GDP has been increasing, there has not been a significant rise in the per capita health expenditure in China, India and Brazil because of the high population growth in these countries. For further details, please click or add the below link to your browser: http://www.gbiresearch.com/Report.aspx?ID=Healthcare-System-and-Delivery-Network-Growing-Geriatric-Population-and-Increase-in-Life-Expectancy-Drives-Demand-for-Healthcare&ReportType=Industry_Report&coreindustry=ALL&Title=Pharmaceuticals_and_Healthcare In the developed countries of Europe and in Japan, a major proportion of the healthcare expenditure is funded by the government. However, in the US, where the market is dominated by private players, the government funding represents close to 46.5% of the total healthcare expenditure. In 2008, public spending on

4. healthcare per capita was lowest in the US (46.5%) and highest in the UK (82.6%). While public spending in the US was $3,507 per capita, the UK spent $2,585 per capita. Public spending on healthcare per capita in the other European countries was $2,875 in France, $2,216 in Italy, $2,869 in Germany and $2,105 in Spain. Japan spent a total of $2,729 per capita on healthcare in 2007. Out-of-pocket payments were the highest in the US and lowest in France in 2008. Increases In Elderly Populations Will Drive the Healthcare Delivery Market In Future As the global population grows, the demand for healthcare will increase. According to demographic projections, the proportion of the global population aged 65 and above will increase drastically by 2020. The rapidly increasing number of elderly people will demand health care and aging-related services. The risk of developing chronic diseases increases with age. About 80% of older adults have one chronic condition, and 50% have at least two. Chronic conditions such as Cardiovascular Diseases (CVD), cancer and respiratory disorders were the most common cause of death in the elderly across geographies. According to the United Nations projections, about 16.1% of the total population in the US, 28.5% of Japan’s population, 20.9% of the population in France, 23% of Italy’s population, 23% of Germany’s population, 18.7% of Spain’s population, and

5. 18.5% of the total population in the UK will be aged 65 and above in 2020. The percentage of elderly population in the emerging countries will be less compared to the developed countries. About 9.6% the total population in Brazil, 5.7% of India’s population and 11.7% of China’s population will be aged 65 and above in 2020. The two most widely used measures to evaluate healthcare outcomes are life expectancy and infant mortality rate. The life expectancy in Japan was 82.1 years and the infant mortality rate was 2.79 deaths per 1,000 live births. Japan’s figures for these two measures were the highest and lowest in the world in 2009. This indicates that the country has a very healthy population. Although the US spent 51% more on healthcare as a percentage of GDP than Japan, life expectancy in the US was 78.1 years. This suggests that increased healthcare expenditure alone does not necessarily result in better life expectancy. For further details, please click or add the below link to your browser: http://www.gbiresearch.com/Report.aspx?ID=Healthcare-System-and-Delivery-Network-Growing-Geriatric-Population-and-Increase-in-Life-Expectancy-Drives-Demand-for-Healthcare&ReportType=Industry_Report&coreindustry=ALL&Title=Pharmaceuticals_and_Healthcare

6. Reimbursement of Health Care Services Varies Across Geographies The developed countries of Europe and Japan have a government-funded healthcare system in which a major portion of the healthcare costs are reimbursed by the government. Medical goods and services that qualify for reimbursement by the health insurance system include in-patient and out-patient costs, diagnostic tests, pharmaceutical products, dental care, rehabilitation, physiotherapy and healthcare-related transport. Reimbursements and co-payments vary across geographies and for each health insurance plan specific to a country. Co-payments may be defined as out-of pocket payments made by the patient for accessing a medical service or medical goods usage not covered by the insurance provider. These may include doctor’s appointments and consultation fees, hospital stays, medical tests and prescription drugs. While co-payments may be an effective cost-containment measure, the disadvantage is that it may discourage patients from seeking essential medical care. In the UK, the publicly funded basic health plan that provides health insurance to all citizens covers 100% of the in-patient costs, out-patient costs and pharmaceutical products. A major share of dental costs is also covered by the national health plan while the rest of the costs are paid by the patients as co-payments. A similar scenario exists for in-patient; out-patient and

7. pharmaceutical drug costs coverage in Italy, with the exception of dental care that requires a co-payment. In Spain, dental treatment is not covered by the national health plan. GBI Research’s new report, “Healthcare System and Delivery Network - Growing Geriatric Population and Increase in Life Expentancy Drives Demand for Healthcare” provides key data, information and analysis on healthcare system in both developed (the US, Japan, France, Italy, Germany, Spain, the UK) and emerging economies (India, China and Brazil). The report provides comprehensive information on the key trends affecting healthcare delivery, and analytical content on the key market dynamics. The report also reviews the competition in the healthcare delivery sector and key factors driving the market. This report is built using data and information sourced from proprietary databases, primary and secondary research and in-house analysis by GBI Research’s team of industry experts. For further details, please click or add the below link to your browser: http://www.gbiresearch.com/Report.aspx?ID=Healthcare-System-and-Delivery-Network-Growing-Geriatric-Population-and-Increase-in-Life-Expectancy-Drives-Demand-for-Healthcare&ReportType=Industry_Report&coreindustry=ALL&Title=Pharmaceuticals_and_Healthcare

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