Strengthening health systems through smart spending

Faced with an unprecedented health security crisis on top of the challenges of an ageing population and increasing burden of chronic diseases, our health systems need to both strengthen their resilience to future shocks and meet increased demand for healthcare, while staying sustainable over time. Whilst we need to keep investing in our health systems, there are also opportunities to make healthcare spending more efficient in order to improve long-term outcomes within the available budget.

According to the OECD, 20% of healthcare expenditure is spent inefficiently, making no meaningful contribution to patients’ outcomes. Smart healthcare spending will allow us to improve health outcomes while not increasing overall costs, or even create savings in the long-term that can be reinvested for better health.

Spending smart often means intervening at the right time, before a disease has led to serious complications for the patient and the system. In order to highlight the benefits for patients and health systems to address inefficient care, and therefore free up resources that could be reinvested in the system, EFPIA looked further into a number of areas where good healthcare practices have improved outcomes for patients. To take but one example, the screening programme for colorectal cancer in the Basque Country has led to a reduction in mortality rate of 26%, which would result in reduced treatment costs and net savings of 93 million Euros over time. According to a study by the Office of Health Economics, if this success was to be replicated across Europe, all other things being equal, this would correspond to an additional 331,000 healthy life years gained per year, and 9,9 billion Euros in savings.

“Imagine if that money could be put to better use, maybe invested in digital health infrastructures or the latest cell- and gene therapies that are starting to transform the lives of millions of patients across Europe?”, said Nathalie Moll, EFPIA Director General. “In the context following the COVID-19 pandemic, we must absolutely avoid the cost-containment approach taken after the 2008 financial crisis, which had very detrimental effects on health and social wellbeing in Europe. The objective of efficiency gains must not be to cut budgets, but to reinvest potential savings in innovation and higher-value care and reimagine healthcare.”

EFPIA has developed a number of policy recommendations for national and European policy-makers to inform a discussion on how smart spending and health system planning can improve long-term outcomes while keeping the systems sustainable and flexible in order to respond to future challenges.

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