How much do countries spend on health? Where does that money come from? And how is it spent?
We’re diving into all these questions to unpack the state of health financing. Spoiler alert: It varies dramatically across countries and income groups.
- In 2022, countries spent $9.8 trillion on health, down 1.6% from 2021
- High-income countries account for the bulk of health spending – 80.5% of total health spending in 2022. Upper middle-income countries account for 16.4%, lower middle-income countries for 2.9%, and low-income countries for 0.3%.
- Health spending in Africa reached $145 billion in 2022, and increase of 0.7% since 2021, accounting for 5% of African countries’ Gross Domestic Product (GDP). Only Cabo Verde and South Africa met the Abuja Declaration Target to spend 15% of domestic government spending on health.
How much do countries spend on health?
Over the last 20 years, health spending has grown across all income levels, from $4.5 trillion in 2000 to $9.8 trillion in 2022. 80.5% of that spending has been in high income countries. Low- and lower-middle income countries, home to half the global population and 56% of the global burden of disease, account for only 3.2% of health spending.
In 2022 low income countries spend $25.4 billion on health, a 1.6% increase from 2021, and lower middle-income countries spent $283.8 billion, a 3.9% increase. In 2020 health spending as a share of GDP increased across all income levels in reaction to the COVID-19 pandemic. However, by 2022, spending levelled off or declined.
How much should countries spend on health?
Some estimates suggest that countries should spend at least 5% of their GDP and US$86 per capita on health to ensure all citizens have access to primary healthcare services. Only South Africa met both targets in 2021.
Other regional targets for health spending exist, like the African Union’s Abuja Declaration Target to allocate 15% of government spending to health.
In 2001, African Union countries set a target of allocating at least 15% of their budget each year to the health sector, known as the Abuja Declaration. As recently as February 2023, African leaders recommitted to implementing the Abuja Declaration Target. In 2021, South Africa, Cabo Verde met the target.
What are the main sources of health spending?
Total health spending in low- and lower-middle-income countries has increased steadily over the past 20 years. What is driving the increases?
In low income countries, external funding accounts for 31% of health spending in 2022 (up from 11% in 2003), while domestic government spending on health accounts for 21% of all health spending (down from 33% in 2002). However, in lower middle-income countries, domestic government spending on health accounts for 37% of all health spending in 2022 (up from 29% in 2000), while external funding accounts for 5% of health spending.
How much do countries spend on health by disease or program area?
Health financing at the country-level supports a wide range of health programs, health services, and systems – such as HIV/AIDS, noncommunicable diseases, and maternal health.
How do Multilateral Development Banks invest in health?
Multilateral development banks (MDBs) provided US$12.2 billion in total health financing in 2021, up 10.5% from US$11.1 billion in 2020. The MDBs provide financing in the form of concessional or "soft" loans (ODA loans), non-concessional or "hard" loans (other official flows), and ODA grants. 65.0% of financing provided for health in 2021 was in the form of hard loans.
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