Re: International comparisons of UK health expenditure: the Devil is in the detail
Sir,
We read Appleby and Gershlick’s analysis of the recently revised assessments of UK health expenditure under new rules, as reported by the Office of National Statistics (ONS) and the Organisation for Economic Co-operation and Development (OECD) with interest[1]. In short, in the latest estimates, UK health expenditure is greater than previously reported.
As the authors report, UK health expenditure, specifically on the NHS, has become politicised as health spending appears relatively low compared to some European peers [2.3,4].
The latest upward revision of UK health expenditure could moderate some of the criticism levelled at current and recent British governments for not spending "enough" on health. However, as this analysis, shows, UK health expenditure is “average”, as opposed to “below average”. This means we spend less than some European Union (EU) countries like Germany, France, Netherlands and Sweden, which are often used as benchmarks.
What is striking about the basket of EU comparison countries in this analysis is that it only includes 14 other original EU countries, “EU-15”. However, there are of course 28 countries in the EU at present[5]. We would be interested to see a similar comparison of health expenditure of all 28 EU countries. This may put the UK’s apparently “average” healthcare expenditure into a more accurate context, but one which is less favourable for those critics who say we are not spending “enough” on health.
It is worth looking at the OECD figures for 2014, the year in question for this analysis. According to the OECD, health expenditure of five other EU countries Estonia, Latvia, Poland, Slovak Republic and Slovenia was 6.2%, 5.7%, 6.2%, 6.9% and 8.5% respectively[6]. UK health expenditure in 2014 was 9.8% on the latest, revised estimate, using System of Health Accounts 2011 (SHA2011) definitions.
We would anticipate that in a comparison of the EU-28, UK health expenditure would be above the EU average as a percentage of GDP. If our suspicions are proved correct, this could give critics of UK health expenditure pause for thought. The counter-argument is that the UK should only be compared with EU members of a similar stage of economic development. Whilst this is fair, it is also prone to the riposte that this is tantamount to subjective cherry-picking to make a political point.
The authors discuss some of the shortcomings of international comparisons like this. One drawback, which we would like to emphasise, is that broad-brush international comparisons do not make clear how healthcare in various countries is delivered e.g. publicly funded, insurance based, private healthcare etc. The model of healthcare delivery in any given country can have a profound impact on healthcare spend as a percentage of GDP.
For example, looking at the aforementioned OECD data, the United States (US), where healthcare is mostly private or insurance-based, spent 16.5% of GDP in 2014 which is more than any other OECD or EU country. It should be noted that the US had the highest GDP in the world in 2016, higher than the combined GDP of all EU-28 nations[7].
It is understandable that international comparisons of healthcare are of such great interest. However, those drawing comparisons should be explicitly clear about which basket of countries are being compared e.g. EU-15 vs EU-28, why, how and to also consider factors like models of healthcare delivery e.g. public vs private. These are important factors which should be declared and explained, so that the public can make properly informed decisions.
Competing interests:
We work for Public Health England but we are also honorary NHS consultants. We are writing in our private capacities. The views expressed are our own and not those of our employer(s).
Rapid Response:
Re: International comparisons of UK health expenditure: the Devil is in the detail
Sir,
We read Appleby and Gershlick’s analysis of the recently revised assessments of UK health expenditure under new rules, as reported by the Office of National Statistics (ONS) and the Organisation for Economic Co-operation and Development (OECD) with interest[1]. In short, in the latest estimates, UK health expenditure is greater than previously reported.
As the authors report, UK health expenditure, specifically on the NHS, has become politicised as health spending appears relatively low compared to some European peers [2.3,4].
The latest upward revision of UK health expenditure could moderate some of the criticism levelled at current and recent British governments for not spending "enough" on health. However, as this analysis, shows, UK health expenditure is “average”, as opposed to “below average”. This means we spend less than some European Union (EU) countries like Germany, France, Netherlands and Sweden, which are often used as benchmarks.
What is striking about the basket of EU comparison countries in this analysis is that it only includes 14 other original EU countries, “EU-15”. However, there are of course 28 countries in the EU at present[5]. We would be interested to see a similar comparison of health expenditure of all 28 EU countries. This may put the UK’s apparently “average” healthcare expenditure into a more accurate context, but one which is less favourable for those critics who say we are not spending “enough” on health.
It is worth looking at the OECD figures for 2014, the year in question for this analysis. According to the OECD, health expenditure of five other EU countries Estonia, Latvia, Poland, Slovak Republic and Slovenia was 6.2%, 5.7%, 6.2%, 6.9% and 8.5% respectively[6]. UK health expenditure in 2014 was 9.8% on the latest, revised estimate, using System of Health Accounts 2011 (SHA2011) definitions.
We would anticipate that in a comparison of the EU-28, UK health expenditure would be above the EU average as a percentage of GDP. If our suspicions are proved correct, this could give critics of UK health expenditure pause for thought. The counter-argument is that the UK should only be compared with EU members of a similar stage of economic development. Whilst this is fair, it is also prone to the riposte that this is tantamount to subjective cherry-picking to make a political point.
The authors discuss some of the shortcomings of international comparisons like this. One drawback, which we would like to emphasise, is that broad-brush international comparisons do not make clear how healthcare in various countries is delivered e.g. publicly funded, insurance based, private healthcare etc. The model of healthcare delivery in any given country can have a profound impact on healthcare spend as a percentage of GDP.
For example, looking at the aforementioned OECD data, the United States (US), where healthcare is mostly private or insurance-based, spent 16.5% of GDP in 2014 which is more than any other OECD or EU country. It should be noted that the US had the highest GDP in the world in 2016, higher than the combined GDP of all EU-28 nations[7].
It is understandable that international comparisons of healthcare are of such great interest. However, those drawing comparisons should be explicitly clear about which basket of countries are being compared e.g. EU-15 vs EU-28, why, how and to also consider factors like models of healthcare delivery e.g. public vs private. These are important factors which should be declared and explained, so that the public can make properly informed decisions.
References:
[1] Keeping up with the Johanssons: How does UK health spending compare internationally? Appleby J, Gershlick B. BMJ 2017;358:j3568 doi: https://doi.org/10.1136/bmj.j3568
[2] UK set to spend £43bn a year less on health than European neighbours. Johnston I. The Independent newspaper 30/1/16: https://www.independent.co.uk/life-style/health-and-families/health-news...
[3] Is enough being spent on the NHS? Triggle N. BBC News (Health) 25/2/16 http://www.bbc.co.uk/news/health-35653455
[4] It’s time to face the truth that our NHS is in mortal danger. Galsworthy M. The New European 21/5/17 http://www.theneweuropean.co.uk/top-stories/it-s-time-to-face-the-truth-...
[5] The European Union: EU member countries in brief https://europa.eu/european-union/about-eu/countries/member-countries_en
[6] Organisation for Economic Co-operation and Development. Health expenditure and financing http://stats.oecd.org/Index.aspx?DataSetCode=SHA
[7] International Monetary Fund – World Economic Outlook Database, April 2017 (2016 data)
https://www.imf.org/external/pubs/ft/weo/2017/01/weodata/weorept.aspx
Competing interests: We work for Public Health England but we are also honorary NHS consultants. We are writing in our private capacities. The views expressed are our own and not those of our employer(s).