High public debt levels can limit healthcare investment and make countries more vulnerable to crises, according to a recent study published in IgMin Research. This research by Mario Coccia from the CNR-National Research Council of Italy analyzes the impact of public debt on healthcare spending and its correlation with COVID-19 fatality rates across European nations. The findings underline the risks associated with reduced healthcare funding in debt-burdened countries, especially when facing emergencies like pandemics.
The study focused on 27 European countries, divided into two groups based on COVID-19 fatality rates in 2020. Group 1, with lower fatality rates, had higher health expenditures and lower public debt growth from 2009 to 2019 compared to Group 2, which faced higher COVID-19 fatality rates. Countries in Group 1 spent more on healthcare (over $3,100 per capita) and had a lower increase in public debt, enabling them to better withstand the pandemic. In contrast, Group 2 countries had lower health spending (around $2,600 per capita) and a higher public debt increase, making them more susceptible to crisis impacts.
The findings emphasize that an increase in healthcare expenditure per capita can significantly lower fatality rates in crises. For instance, a 1% increase in healthcare spending in 2019 correlated with a 1.2% reduction in COVID-19 fatality rates. However, rising public debt often forces countries to reduce healthcare budgets, weakening their capacity to respond to emergencies. This situation highlights a critical need for sustainable fiscal policies that protect health sector funding even amid budget constraints.
As future emergencies are inevitable, the study suggests that nations should prioritize debt reduction through good governance and avoid austerity measures that cut health investments. Policies ensuring consistent healthcare funding can strengthen resilience and better prepare countries for future pandemics, natural disasters, and other global crises.
Full Text: https://www.igminresearch.com/articles/html/igmin214
PDF Link: igmin.link/p214
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