Addressing financial sustainability in health systems

Author(s)/Editor(s): Thomson S, Foubister T, Figueras J et al.
Publisher/Organizer: World Health Organization 2009 on behalf of the European Observatory on Health Systems and Policies
Publication date: 2009
Number of pages: 49 p
Language: English


“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 notion of ‘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 (1). 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 aims to shed light on the notion of financial sustainability and to examine its policy relevance in practical terms. Without a better understanding of what is meant by financial sustainability and, importantly, without explicitly linking the issue to questions such as willingness to pay for health care, the value of the benefits gained from health spending and how to improve the performance of the health system, policy responses to sustainability concerns may be misdirected and yield unintended consequences.

This policy summary shows the limitations of adopting financial sustainability as a ‘policy goal’, arguing instead that it should be understood as a 'policy constraint', and translating this notion into three key policy-relevant questions”