Whenever I greeted the Finance Minister with a ‘Hi’, he would wave and walk away saying ‘Bye’. I could not capture his attention for my requests.
Now he is chasing me, offering to give money to strengthen health services because he is worried about the damage that the virus outbreak will do to the economy by shutting down businesses”. This was the tongue in cheek comment of a health minister, of a country which will remain unnamed, at a recent international conference.
It is the lament of many health ministers that they do not get sufficient budgetary allocation to support a robust health service.
In most countries, they usually do not carry the same clout as the finance minister and are ignored when they plead for higher budgetary allocations to health.
It is only when a major health crisis creates a media storm and political palpitations in the government, or when there is threat of a serious infectious disease outbreak that shutters business and shatters tourism that the finance ministers becomes very attentive to the state of the nation’s health.
However, the finance ministers would do well to recognise two facts. First, it is only when the health system is dependably strong and functioning well in the steady state that it can speedily develop the needed surge capacity in times of crisis — a hobbling horse cannot suddenly become a champion racer when the foe is charging at full speed. Second, even without emergencies, investments in health will yield economic benefits through several mechanisms — it is one of the best investments a country can make.
For most of the twentieth century, economists regarded expenditure on health as a cost, without an economic return. American economist William Baumol regarded health as a “cost disease” to the economy. Others saw health as a passive beneficiary of economic growth but failed to acknowledge the reciprocal relationship.The World Development Report of 1993 (Investing In Health; World Bank) made a strong case for governments spending more on health to reap the economic benefits of human development. Despite some of the report’s recommendations on health system structure and priorities being contested, it opened the path for the WHO Commission on Macroeconomics of Health (2001) which assembled further evidence of economic benefits from health gains.
In 2013, the Lancet Commission on Investing in Health, chaired by two eminent economists, concluded that one dollar investment in health would yield 9 to the 20-fold returns on investment in low and middle income countries (LMICs). The commission noted that around one-quarter of economic growth between 2000 and 2011 in LMICs arose from the value of additional life years gained by improvements in health. Recognition of the bidirectional relationship between health and economic development, which began with the Millennium Development Goals of 2000, became stronger by the time Sustainable Development Goals were framed in 2015.
Health of a population boosts national economy through protected productivity and unhindered access to education and employment, which may otherwise be blocked by poor health. A growing health sector also provides gainful employment to many. By promoting mental health, we reduce conflict in society.
Lack of attention to health promotion and disease prevention raises healthcare costs through expensive treatments that could have been avoided. This reduces a family’s ability to spend savings on good nutrition, education and purchase of other goods. Poor health in a population creates instability in both labour and consumer markets, hurting the economy. The country will also become internationally non-competitive, in business, science and sports.
The health sector can be a major job creator, especially in India where the demographic profile is still young and many jobs are needed to gainfully employ the youth. Even as jobs decrease in the technology intensive industry, agriculture and service sectors, health sector will offer job opportunities. Doctors, nurses, technicians, other allied health professionals and community health workers are needed in large numbers for our health system. Ageing populations in high income countries will create gaps which our surplus health professionals can fill after our needs are met. The economic gains of the health workforce growth were highlighted by a High Level Commission of the United Nations in 2016.
The alternative to investing in health is disastrous. A sick population will see productivity plummet due to both ‘absenteeism’ and ‘presenteeism’. Talented people may die young before society can fully benefit from their contributions. Families will be pushed into poverty. Public health emergencies will disrupt business, deter investment and damage tourism. The outbreak of plague in Surat in 1994 saw 52 suspected plague-related deaths but economic losses were estimated at 2 billion dollars. Kerala saw a blow to tourism-related economy during the Nipah outbreak of 2018. Investment in health is an investment in social and economic development that no finance minister should be parsimonious about.
(Views expressed are personal)
K. srinath reddy
President, Public Health Foundation of India (PHFI)