Typical street scene in Santa Ana, El Salvador. (Photo: iStock)
April 30, 2007
How might a country's health care affect its economy?
Along with health care issues, low-income countries are grappling with the macroeconomic consequences of malaria, tuberculosis, and HIV/AIDS (photo: Georgina Cranston/KRT).
Health care primer
Economic policymakers often measure their success solely by their country's economic growth and thus overlook ways in which macroeconomic policy is influenced by and influences the social sectors—education, health, and income security.
Over the past decades, structural adjustment policies have had a profound effect on the social sectors and on social development in low-income countries. And, in many industrial
countries, policymakers are increasingly aware that developments in the health and pension areas will create fiscal pressures that have implications for the macroeconomic policy framework.
"Macroeconomists and economic policymakers frequently assume that social sector policies should follow the free market strategy that has worked so well in fostering economic growth."
A new IMF publication, What Macroeconomists Should Know about Health Care Policy, by Peter S. Heller and William C. Hsiao, aims to acquaint macroeconomists with some of the basics about the economics of health care and the major health issues confronting countries. It offers a perspective for examining a country's health care system by suggesting some broad guideposts that macroeconomists can use to evaluate a country's health policy and the performance of its health system.
Key challenges are confronting countries around the world: spending on health care strains both household and government budgets; advanced economies and some emerging market countries must deal with the problems that accompany population aging; middle-income countries must fund and deliver services to address the communicable diseases affecting the poor and the chronic diseases facing middle- and upper-income groups; and low-income countries grappling with high levels of HIV/AIDS are receiving more donor assistance but are having difficulty absorbing it, and most suffer from a shortage of human resources.
This primer seeks to provide macroeconomists with the information they need to understand the economics of the health sector: which health policies may improve the equity and efficiency of health care and which policies will improve the level of health status, reduce poverty, and enhance social and political stability.
