Abstract
SummaryBackgroundHow to finance progress towards universal health coverage in low-income and middle-income countries is a subject of intense debate. We investigated how alternative tax systems affect the breadth, depth, and height of health system coverage.MethodsWe used cross-national longitudinal fixed effects models to assess the relationships between total and different types of tax revenue, health system coverage, and associated child and maternal health outcomes in 89 low-income and middle-income countries from 1995–2011.FindingsTax revenue was a major statistical determinant of progress towards universal health coverage. Each US$100 per capita per year of additional tax revenues corresponded to a yearly increase in government health spending of $9·86 (95% CI 3·92–15·8), adjusted for GDP per capita. This association was strong for taxes on capital gains, profits, and income ($16·7, 9·16 to 24·3), but not for consumption taxes on goods and services (−$4·37, −12·9 to 4·11). In countries with low tax revenues (<$1000 per capita per year), an additional $100 tax revenue per year substantially increased the proportion of births with a skilled attendant present by 6·74 percentage points (95% CI 0·87–12·6) and the extent of financial coverage by 11·4 percentage points (5·51–17·2). Consumption taxes, a more regressive form of taxation that might reduce the ability of the poor to afford essential goods, were associated with increased rates of post-neonatal mortality, infant mortality, and under-5 mortality rates. We did not detect these adverse associations with taxes on capital gains, profits, and income, which tend to be more progressive.InterpretationIncreasing domestic tax revenues is integral to achieving universal health coverage, particularly in countries with low tax bases. Pro-poor taxes on profits and capital gains seem to support expanding health coverage without the adverse associations with health outcomes observed for higher consumption taxes. Progressive tax policies within a pro-poor framework might accelerate progress toward achieving major international health goals.FundingCommission of the European Communities (FP7–DEMETRIQ), the European Union's HRES grants, and the Wellcome Trust.
Highlights
Universal health coverage (UHC) seems likely to feature in the post-2015 Millennium Development Goals.[1,2] In 2005, all 192 member states of the WHO committed themselves to achieving UHC, whereby “all people obtain the health services they need without suffering financial hardship when paying for them.”[3]
In 2012, Margaret Chan told the World Health Assembly that “Universal health coverage is the single most powerful concept that public health has to offer.”[4]. Subsequently, the UN General Assembly’s resolution on UHC passed unanimously.[5]
In low-income and middle-income countries (LMICs), each $100 per-capita increase in tax revenue was associated with an additional public health spending per capita of $9·86
Summary
Universal health coverage (UHC) seems likely to feature in the post-2015 Millennium Development Goals.[1,2] In 2005, all 192 member states of the WHO committed themselves to achieving UHC, whereby “all people obtain the health services they need without suffering financial hardship when paying for them.”[3]. The 2010 World Health Report set out a “Path to Universal Health Coverage”,1,2 containing four financing strategies, such as increasing efficiency of taxation, reprioritising government budgets toward health, evaluating innovative financial mechanisms (eg, financial transaction taxes), and increasing development assistance for health. The Lancet’s Commission on Investing in Health called for a “grand convergence”[7] in health with implementation of UHC. It recommended raising revenues through taxation (principally on tobacco and other unhealthy products) but failed to specify how sufficient revenue could be raised, in highly deprived settings where a large fraction of health spending comes from donor assistance.[7]
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