Since the beginning of my academic career, I have focused my attention on analysing the underlying causes of healthcare expenditure dynamics and how they impact the health of citizens. It is commonly believed that an increase in resources allocated to healthcare leads to higher life expectancy and overall well-being, and the debate becomes heated on the political front every year-end, as countries must approve the budget law, sparking a frantic search for funds for the public healthcare system.
However, things are not always as straightforward as they might seem to the general public. Numerous studies have shown that an increase in healthcare spending, in certain contexts, does not necessarily result in an actual improvement in population health and, in some cases, may even lead to a reduction. This concept should not be hard to grasp. If in some Western hospitals there are already sufficient doctors and nurses for the available beds, why should further increasing medical staff be considered a positive move? Not to mention that in some contexts, the increase in resources could end up feeding the pockets of organised crime or lead to negative cases of corruption, and so on.
An excess of resources, in short, can have some surprisingly negative effects.
This is not to say that resources are unwelcome. On the contrary, I do not want to downplay the importance of healthcare spending. Experts have concluded that, in the end, what truly makes a difference is the adoption of advanced medical technologies. Medications like aspirin, which, by the way, is very cost-effective, beta-blockers and statins for cardiovascular issues represent crucial interventions in improving people’s health and well-being.
In addition, there is another path that could lead to significant financial savings and resources that could then be allocated to strengthen public healthcare systems, such as the National Health Service. This innovative approach involves promoting lower-risk behaviours and decreasing the negative health outcomes of existing risky behaviours.
Countries like England, Sweden and Japan have embarked on a path of promoting transitioning from traditional cigarettes to low-risk products via the use of alternative products while aiming to minimise the use of traditional cigarettes. According to my recent studies, this approach could lead to substantial savings for the National Health Service, estimated at over half a billion pounds in both England and Italy. Considering the significant decrease in risk associated with the use of alternative products compared to cigarette consumption there would be fewer hospitalisations, fewer complex surgeries, fewer deaths and less suffering (think of people afflicted with lung cancer).
This would mean having additional resources to tackle the pressing challenges facing many Western countries post-pandemic, such as the increase in hospital waiting lists and issues relating to climate change. Furthermore, more resources could be freed up by promoting a decrease in excessive alcohol consumption, as well as encouraging greater physical activity. While we cannot aspire to a world completely free of risks, we can dream of a world where those risks lead to fewer issues and the resources available for collective well-being are greater.
Author – Professor Francesco Moscone, a business economics experts at Brunel university London & Economist in Public Finance at Ca’ Foscari University of Venice
