Relatively few countries set an explicit Quality-Adusted Life-Year (QALY) value the way that the UK does – and even there, it is a guideline (about $40K), not a hard and fast number. The World Health Organization does, however, suggest that the cost-effective level of a QALY should be 1–3X the per-capita GDP of a given country[1] [2] . The obvious feature of such a threshold is that it is based upon ability to pay, rather than the value of a life, which should be universal.
But I think we can learn something about how different countries value the lives and health of their citizens by comparing actual health expenditures vs ability to pay. Here is a plot of total healthcare expenditures as a percent of GDP vs GDP per capita[3]:
There is a significant (P = 0.0003) upward trend to this relationship – richer countries are willing to spend a greater fraction of their resources on healthcare. That’s not a surprise. Once you have food and shelter, healthcare is going to be a top priority for spending remaining income.
What does surprise me is how weak the relationship is. For every $1000 increase in per capita GDP, there is only about a 0.04% increase in health spending. For the median country, with a per capita GDP of $5500, that amounts to an additional $2.20 in increased health spending per person per year.
That’s in a linear model (the red line), which implicitly assumes that healthcare spending will go up infinitely with income. But a quadratic fit (green line) yields only slightly higher results, although it does fit the data better (r^2 = 0.1 vs 0.07), suggesting that there is a point of diminishing demand for incremental spending on health care.
The interesting and instructive cases are the countries that deviate the most from the trendlines, spending either much more or much less than expected given their per capita GDP. Here are the top ten overspenders:
The number given here, the residual, is the distance above (if positive) or below (if negative) the green trend line on the chart above.
We have here a bunch of very small countries, many of them island nations – and the USA. Despite its ranking at the top of the list, the Marshall Islands spends only $680 per capita on health care. It is not a big spender, but rather is so tiny and so poor that even a small expenditure becomes relatively large. If we exclude countries with economies < $100B USD, then we get a list that is more reflective of the true big spenders with regard to health care:
The US is still a remarkable outlier, completely out of line with its economic peers. Two other countries stand out in what is otherwise a list of prosperous liberal democracies – Ecuador and South Africa. South Africa has a significantly higher infectious disease burden than the other countries, but also has made a significant commitment to providing universal health care for its people[4] . Ecuador also features a similar combination of high levels of infectious disease with a strong commitment to providing universal (and free) health care[5] . I think one could make a case for these two relatively poor countries as being among those that value the life and health of their citizens the most.
On the other end of the spectrum, we have the following list of underspenders:
This end of the list is a mixture of two types of countries: extremely wealthy states that spend a lot in absolute terms (Singapore, the UAE, Kuwait and Qatar), and countries that are poor and are poorly governed, if not outright kleptocracies. Saudi Arabia is perhaps a bit of both. None of these countries have political systems that are particularly responsive or accountable to their citizens. Most of them rank very poorly with respect to gender equality and women’s rights[6] . Many of them are Muslim-dominated.
The spread in relative health care expenditures illustrates an important point. Not every country can be rich. But countries can make choices as to how they allocate the resources they do have. They can have a large military and a nuclear arsenal like Pakistan. Or they can try to take care of their people to the best of their ability, like Ecuador. It is not fate or history or circumstances, it is a choice.
Footnotes
[1] Generalized cost-effectiveness analysis for national-level priority-setting in the health sector.
[2] Table: Threshold values for intervention cost-effectiveness by Region
[3] World Development Indicators
[4] The South African national health insurance: a revolution in health-care delivery!
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