Varying impact of health expenditure in Southeast Asia

health expenditure southeast asia

Health expenditure assumed enormous importance with the outset of coronavirus pandemic. The disparity between public and private health expenditure will often reflect in the health outcome of any nation. Through the research paper titled ‘The dynamics of public and private health expenditure on health outcome in Southeast Asia’ published in the journal Health and Social Care in the Community, Dr Shailender Singh, Associate Professor, Department of Commerce, attempts to argue that public expenditure on health has a substantial impact over private spending across the countries of ASEA.

Abstract of the Research

This study examines the dynamics of public and private health expenditure on health outcomes in Southeast Asia, vis-a-vis two of the Sustainable Development Goals (SDGs). The techniques of fixed effect, random effect, and feasible generalized least square methods are employed to obtain robust estimates. Further, the analysis dives deep into the country-specific impact of public and private health expenditure on health outcomes using the technique of seemingly unrelated regression. Estimates show that, across Southeast Asia, public health expenditure alone contributes to improving life expectancy at birth, lower levels of under-five, and non-communicable disease mortality rates. Unlike public health expenditure, private health expenditure contributes to better health outcomes only in Brunei and Singapore but not across the countries of Southeast Asia.

The paper asserts that, despite the statistical significance of private health spending with respect to the health outcomes, it does not contribute to lower mortality rate (MR) and higher life expectancy at birth. The results strongly support several prior pieces of evidence in the literature regarding health expenditure and health outcomes. The country-specific estimates show that public health spending contributes greatly to lower mortality rate, particularly in Brunei and Singapore. By contrast, private health spending does not contribute to lower levels of U5MR and NCD mortality rate across the countries of ASEA except in Cambodia, Indonesia, and Philippines.

The differences in economic development and the settings of health systems in these countries could be a plausible reason for the inability of private health expenditure to contribute to lower levels of NCD mortality rate in most of these countries. The result implies that more funding to the public health system has the potential to lower U5MR and NCD MR close to the SDGs target across the countries of ASEA. Also, strengthening the health system through providing greater access to preventive services for diabetes, hypertension, respiratory diseases, and cancers at primary care units may help in better diagnosis and management of these chronic conditions in Indonesia, Laos, and Myanmar where NCD MR is relatively high. However, an increase in funding alone may not be sufficient at improving health outcomes. For emerging conditions, diet modification, active physical exercise, little tobacco and alcohol consumption are also imperative.

The research is reported to be the first of its kind that examines the dynamics of public and private health expenditure on health outcomes in line with the SDGs targets. Apart from the traditional indicators commonly used as health outcomes in the literature (life expectancy and U5MR), the study further extends the literature by introducing NCD MR as an additional health outcome which could play a pivotal role in providing empirical evidence to the health policymakers and researchers.

Health plays an important role in promoting human capital and the economic growth of a country. The available stock of human capital in a country determines the rate of growth in its per capita income. A healthy individual contributes more to their economy by allocating more hours to work, earning more disposable income, in turn investing more in human development.

As the individual stock of health tends to diminish over time, there is a need to augment it by making more investment in time, income, and regular medical care. Thus, this research work has a societal benefit for the population of Southeast Asia to identify the threats in the field of health and focus more on their well-being for improving the state of health. Dr Singh conducted this research in collaboration with Dr Nishant Kumar, Amity University, Noida.

In future, he also intends to analyse the impact of socioeconomic and behavioural health determinants on the health system efficiency of the Middle East region, and to predict the key drivers for health care expenditure growth in the Middle East region through Grossman-PLS Modeling Approach.

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