Addressing financial sustainability in health systems

ABSTRACT

The question as to whether health systems will be financially sustainable in the future is frequently raised in health policy debate. The problem is often phrased in terms of the ability of governments and others adequately to finance health care in the face of growing cost pressures, with population ageing, new technologies and consumer expectations around health care coverage and quality being the three most commonly cited challenges. Although the notionof ‘financial sustainability’ appears to be central to health policy debate, it does not form part of most health system objectives, including those of the World Health Organization’s health system performance framework. Moreover, there is little clarity or consensus about the term's meaning, beyond it having something to do with ‘ability to pay’ or ‘affordability’. Nevertheless, the underlying ‘sustainability’ issue – balancing rising cost pressures against limited resources – is a concern across countries, all the more so in the context of the current financial crisis. Inevitably, this means addressing trade-offs, both within the health sector itself and more broadly between the health sector and the rest of the economy. This policy summary, prepared for the Czech European Union Presidency Ministerial Conference on the Financial Sustainability of Health Systems(Prague, 10–12 May 2009), aims to shed light on the notion of financial sustainability and to examine its policy relevance in practical terms.