Wednesday, November 14, 2012

Global Health blog: Better Drug Use, Greater Efficiency

from Center for Global Development - Latest Updates

 
By Amanda Glassman - This is a joint post with Denizhan Duran.
As governments across the world expand population access to health care, they are feeling the pressure of rising costs. According to the IMF, emerging economies will spend an additional 1.5 percentage points of GDP on health care over the next 20 years, most of which will come from excess cost growth – defined as health care cost growth related to new medical technologies and income growth, rather than aging.

How can governments and other payers cope with the pressure of increasing costs and demands? A new report issued by the IMS Institute focuses on one strategy: advancing the responsible use of medicines.

After health care provider salaries, total spending on medicines represents the largest category of spending on health, and is growing quickly. Since 2005, total spending has grown by 12% in middle-income countries and 14% in low-income countries. Today, one-fifth of total health spending goes to medicines. Figuring out how to realize efficiencies in medicines spending is therefore crucial for every country, and for the international funders that support them.

In order to examine potential levers of efficiency, IMS uses data from 34 countries, 21 of which are low- and middle-income countries. After extrapolating this data to other countries, the authors identify six strategies that might yield efficiency savings. In particular, non-adherence to medication and untimely medicine use are estimated to generate 70% of avoidable costs from suboptimal use of medicines. If these problems were effectively addressed, the IMS Institute foresees $500 billion a year in potential savings (see figure below from the report).

see article: Global Health blog: Better Drug Use, Greater Efficiency

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