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The global financial crisis: an acute threat to health
COMMENT
 
 
  The Lancet, Volume 373, Issue 9661, Pages 355 - 356, 31 January 2009
 
Richard Horton
The Lancet, London NW1 7Y, UK
 
"Evidence from past economic crises gives us reasonable precision about what is likely to happen over the next 12 months. Government expenditures on health will be squeezed and likely fall, contributing to worse health outcomes. Household income to pay for health will drop. Insurance protection will decline. The cost of medicines will probably increase (because of currency devaluations). Patients will switch from the private to the public sector, putting an often unbearable burden on government-funded health services...... Donors are already turning away from critical health programmes, such as food. Financial uncertainty may set one health programme against another in a frantic competition for funds. Fracture of the health sector could precipitate social unrest."
 
As the global economy enters a sharp and severe recession, desperate financiers are turning to astrology for inspiration.1 But last week, WHO convened something rather different: a high-level consultation on the financial and economic crisis and global health. Margaret Chan, WHO's Director-General, sought to build awareness and identify actions. Her concern is that while governments grapple with fiscal meltdown, health may be neglected. Worse, if the evidence of past recessions is anything to go by, the impact on health will be worse than we think. As the World Bank's Richard Newfarmer put it, the health community should prepare for the worst.
 
What can we expect for health? The first predicament to recognise is that countries are not in a good place to weather another storm. Progress towards the Millennium Development Goals has been slow and uneven. Inequities in health are deep and intractable. Donor funding is unpredictable. International institutions suffer pervasive democratic deficits\the views of low-income and middle-income countries are too often marginalised or excluded.
 
As the current crisis bites, millions more people will be pushed into poverty (around 20 million people for every 1% decline in growth, according to the World Bank). Foreign direct investments will fall. Aid will dry up. Remittances will decline. Global trade, the World Bank estimates, will drop by 2„5%. A fall in aid is a special concern. Preliminary WHO data indicate that 23 countries have over 30% of their total health expenditure funded from donors. These financial flows render them exquisitely sensitive to small shifts in donor policy. Add to these concerns the existing food and energy crises, and the financial downturn creates a triple toxic mix.
 
Evidence from past economic crises gives us reasonable precision about what is likely to happen over the next 12 months. Government expenditures on health will be squeezed and likely fall, contributing to worse health outcomes. Household income to pay for health will drop. Insurance protection will decline. The cost of medicines will probably increase (because of currency devaluations). Patients will switch from the private to the public sector, putting an often unbearable burden on government-funded health services. And what services the government does provide are likely to be captured by the non-poor. The sum of these changes is that women and children (especially girls) will bear the brunt of harm\rising infant mortality and worsening nutrition. Donors are already turning away from critical health programmes, such as food. Financial uncertainty may set one health programme against another in a frantic competition for funds. Fracture of the health sector could precipitate social unrest.
 
Still, there may be reasons to be hopeful. First, the World Bank believes that countries are in a good position to borrow money to protect social and health programmes. Second, a Task Force on Innovative Financing for Health Systems was launched last September under the chairmanship of UK Prime Minister Gordon Brown and the President of the World Bank, Robert Zoellick.2 This task force aims to identify new funding streams and build better ways to use existing resources. The final report from this task force will be published in September this year at the UN General Assembly.
 
Third, this crisis presents an opportunity for a step change in the way we do global health. We now have permission to ask questions that were unthinkable a year ago. Should the Global Fund to fight AIDS, Tuberculosis and Malaria fuse with UNAIDS? Should the Global Fund extend its concern beyond three diseases? Should the World Bank radically alter its purpose? Can UN reform be accelerated to reflect more accurately today's geopolitical realities? Can PEPFAR and the Gates Foundation be brought more into the mainstream of global-health governance?
 
A further source of traction could be the G8.3 One conclusion from Japan's leadership of the G8 last year was that the Group is uniquely positioned to help change the global-health agenda and its priorities. The G8 is one of the few bodies that can tackle the interaction between economic development, foreign policy, security, and health. Japan argued that the G8 should move from summitry to accountability. It could provide the necessary monitoring mechanisms to review donor delivery on global-health commitments. The G8 can ensure that donor promises are kept. Italy occupies the G8 chair in 2009 and could do a great deal to reposition the G8 to act as a barometer of global wellbeing.
 
What can be done to mitigate the impact of the financial crisis? The advice from the World Bank to countries is pointed. Countries should focus on financing specific essential services for vulnerable populations. The emphasis should be on access to defined services, not on an overall figure for governmental health expenditure. Governments should identify those key services, the people they are targeting, and the means (eg, conditional cash transfers) by which services can be matched to individuals. But to make this rational planning work requires better science, better data, and better monitoring. Civil society has a vital part to play by providing an additional accountability mechanism for governments. Civil society can provide the pressure to make health a national entitlement. It can also foster solidarity between donors and recipient countries, between government and the people, and among citizens. Meanwhile, donors must keep their aid promises. The G8 could be one means to keep donors honest.
 
What can WHO do? The high-level consultation held in Geneva last week signalled great support from countries for WHO's strengthened role in advocacy, analysis, and monitoring. WHO can also accelerate its work to realise the vision of universal primary health care. It can use the financial crisis as an opportunity to review and restructure its resource allocations to better respond to global priorities in health. It can insist on stronger and more effective health representation in economically influential institutions, such as the World Trade Organization.
 
Health and health systems reflect and evolve from the economic, political, and social conditions within countries. The deep connections between health and economics, and the chronic neglect that the health community has so far paid to economics, means that if we do not now respond candidly and creatively to these threatening financial conditions, we will be failing the very people we claim to represent. We can do better than that.
 
References
1 Leach B. City workers seek psychic help for financial future. Sunday Telegraph Jan 18, 2009: 5. PubMed
2 International Health Partnership. High Level Taskforce on Innovative International Financing for Health Systems. http://www.internationalhealthpartnership.net/taskforce.html. (accessed Jan 21, 2009).
3 Reich MR, Takemi K. G8 and strengthening of health systems: follow up to the Toyako Summit. Lancet 200910.1016/S0140-6736(08)61899-1. published online Jan 15. PubMed
 
 
 
 
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