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Restructuring health systems: How to promote health in times of austerity?

7 June 2012

On 6 June 2012, Health First Europe attended the annual conference of the European Public Health Alliance which focused on how to promote health in times of financial crisis.  The conference brought together representatives from various international and European organisations to discuss not only the impacts of austerity on health systems, but also solutions to the current challenges presented by ageing populations, shortages of healthcare professionals and declines in social and healthcare spending.

The event featured a keynote speech by Zsuzsanna Jakab, WHO Regional Director for Europe, who highlighted the importance of making the economic argument for promoting health in times of austerity.   She discussed how keeping the population healthier provides enormous economic benefits for Member States.  For example, she cited that a 1% increase in life expectancy translates into a 6% increase in GDP for a nation.  She proposed that in order to ensure health is still a priority in times of austerity, governments should avoid across the board budgets cuts, target public expenditures better to the poor and vulnerable,  seek efficiency gains through wiser use of medicines and technologies and use the crisis to introduce long overdue reforms.

Discussing the cost of the economic crisis for populations and health, speakers described some of the significant issues being faced by individuals, professionals and systems.  Maria Nyman, Director of Mental Health Europe, pointed out the sharp increases in mental health related problems due to fears about redundancy and reductions in benefits.  David Stuckler, Social Epidemiologist and Lecturer at Cambridge University, provided examples of costs to the system during austerity such as a 20% increase in diagnoses of depression in Spain and a 52% increase in HIV in Greece due to sharing of needles by drug users.  He suggested that "cutting health budgets in times of austerity is madness" as it only creates more health problems for the society.  Paul de Raeve, Secretary General for the European Federation of Nurses, reminded participants of the impact of cuts on nurses - 92% of which are women.  Mr. de Raeve highlighted that the decreases in recruitment and retention of nurses due to declining salaries will significantly impact the quality and safety of care throughout Europe.

Changing the focus from the challenges of the crisis to potential solutions, Pascal Garel, Chief Executive at the European Hospital and Healthcare Federation (HOPE), reminded participants that "There is no one solution to austerity measures – we are too different."  The differing revenues of Member States and the various contributions of public money to healthcare were highlighted by many panelists as a consideration when determining potential solutions.  However, Christoph Schwierz, Policy Analyst at the Economist unit in DG Economic and Financial Affairs, as well as Valerie Moran, Health Analyst from the OECD, stressed the fact that health expenditures will continue to rise faster than GDP creating considerable future challenges for health systems.  Pervenche Béres, Member of the European Parliament (S&D, France) underlined the fact that even in times of austerity, we need to remember that human dignity must be maintained for all and the most vulnerable populations must not be forgotten.

The question of whether the financial crisis will be an impetus for change was also raised at the event.  Deputy Director of the Fiscal Affairs Department at the International Monetary Fund, Sanjeev Gupta, presented alarming statistics showing growth to debt ratios of countries throughout the world in addition to showcasing some viable solutions to contain public health spending growth.  He suggested that options could include: 1) budget caps (Italy, Japan and Sweden); 2) greater sub-national government involvement; 3) greater competition and choice (Germany and Japan) – insurance and providers; 4) greater reliance on private financing, especially on complimentary healthcare outside public package (Australia, Canada, France); 5) restricting supply of health inputs/outputs (doctors/beds, etc.).  He further declared that solutions are specific to each country and some reforms are more beneficial than others.  Following on Mr. Gupta's presentation, Josep Figueras, Director of the European Observatory on Health Systems and Policies at the WHO European Centre on Health Policy, stated that "this is the time to be radical" and proposed that reforms should allow for patients to have more choice in order to reduce costs.

Overall, the event clearly showed the impact the financial crisis is having on health systems and individual patients. Though solutions exist for creating sustainable healthcare systems during times of austerity, the most important issue is for governments is to make healthcare a priority.  Economic evidence showing the value of health and healthcare for societies exists, but convincing governments to change healthcare systems, remains the ultimate challenge.