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Financing Global Health 2020 The impact of COVID-19

Executive summary Much has changed since the Institute for Health Metrics and Evaluation began publishing the annual Financing Global Health series of reports in 2009. The report, which initially focused on development assistance for health, has grown to cover an expanded list of sources and health focus areas, and has reported estimates related to a number of global health developments, from the fallout of the 2008 global recession to the conclusion of the Millennium Development Goals in 2015. This year’s report tracks spending on global health, but specifically highlights development assistance for health support during a pandemic, and that fact – that COVID-19 continues to challenge the world, infecting and killing thousands every day – underscores the importance of tracking resources available for health. In addition to providing readers a picture of how the world’s major health donors have responded to COVID-19, the work presented in Financing Global Health 2020 can help decision-makers craft responses to the health challenges of both today and tomorrow. As in previous years, Financing Global Health 2020 (the 12th in the series) provides updated estimates of spending on health, development assistance for health, and projections of future health spending. Our health spending tracking and estimates show patterns between income groups and regions over time, and highlight variations between countries, which can identify where more resources are needed most. Financing Global Health 2020 particularly focuses on how donors have responded to the COVID-19 pandemic and the associated changes in global spending and global spending priorities. We also highlight other areas of concern – and opportunity – facing the world. The enormity of the crisis COVID-19 has posed, and continues to pose, cannot be overstated. Since the beginning of the pandemic, COVID-19’s toll on the world’s health has been staggering. As of August 15, 2021, approximately 2.5 billion people have been infected with COVID-19,1 and the pandemic has led to 4.4 million reported COVID-19 deaths globally. An additional 1.1 million reported deaths – for a total of 5.5 million – are projected by December 1, 2021, while evolving challenges associated with new variants of the virus are making the pandemic’s future anything but certain. Moreover, according to the International Monetary Fund, the pandemic’s economic impact has been severe, with global GDP contracting an estimated 3.5% in 2020, including a decline of approximately 7.0% in Latin America and the Caribbean, and more than 6% in sub-Saharan Africa. Among its many other effects, COVID-19 has also led to a substantial increase in development assistance for health (DAH). All told, we estimate that $13.7 billion in DAH was allocated to the health response for COVID-19 activity, such as spending on treatment and logistics. This support led to an unprecedented increase of 35.7% in overall DAH between 2019 and 2020. Our analysis also shows that by region, development assistance for health for COVID-19 has to date not necessarily matched where the virus has had 12 | FINANCING GLOBAL HEALTH 2020 the most impact. For example, the Latin America and Caribbean Global Burden of Disease super-region has received only 5.2% of DAH for COVID-19, but as a region has experienced 28.7% of reported global COVID-19 deaths as of August 15, 2021.1 We explore this and other findings in depth in Financing Global Health 2020’s COVID-19 sections. This year’s report also updates our estimates of pandemic preparedness spending. In 2020, development assistance for health for pandemic preparedness was an estimated $811.1 million, or about 1.5% of total 2020 DAH (which was an estimated 0.58% [95% uncertainty interval 0.57–0.58]† of overall 2020 global spending on health). As we saw last year and will continue to see in stark terms for as long as COVID-19 lasts, inadequately preparing for pandemics can have disastrous, long-lasting consequences. More broadly, Financing Global Health 2020 includes health spending estimates that cover 204 countries from 1995 to 2018. For DAH, we present estimates from 1990 to 2020 for 135 low- and middle-income countries. And our future health spending scenarios cover 204 countries for the period from 2019 to 2050. The COVID-19 pandemic has shown the world how important having robust health systems is (of which pandemic preparedness is just one element), and Financing Global Health’s government spending data and DAH estimates help policymakers identify areas for health system improvement. Our work shows that total global health spending has continued to increase, reaching $8.5 trillion (8.4–8.5) in 2018, the most recent year for which observed total health spending data are available. This constitutes a 3.0% (1.7–4.3) increase over the 2017 total. By type, 2018 spending breaks down as follows: • $5.0 trillion (5.0–5.1), or 59.4%, government health spending • $1.9 trillion (1.8–1.9), or 22.1%, prepaid private spending • $1.5 trillion (1.5–1.6), or 18.0%, out-of-pocket spending • $39.2 billion, or 0.5%, donor financing In 2018, the global population was an estimated 7.7 billion people, 46.7% of whom (3.6 billion) lived in one of the 79 low-income or lower-middleincome countries. Even though, in 2018, DAH constituted only 0.46% (0.46–0.47) of global spending on health, it is important to those countries that depend on it. In addition to acting as a lifeline for some countries, DAH can be a catalyst, by focusing investments on activities or populations that might not otherwise receive attention or resources. As noted, total DAH in 2020 was up more than 35.7% from our 2019 estimate of $40.4 billion. Though it has grown over the past 30 years – in 1990, DAH was $8.1 billion, marking a rise of 574.0% over the time period of our tracking – DAH has never grown the way it did between 2019 and 2020. Indeed, between 2010 and 2019, development assistance for health was largely flat, hovering between $35.3 billion and $40.6 billion per year. As positive as the 2019–2020 growth is, additional spending is needed to ensure that lower-income countries do not fall behind. Without taking spending on COVID-19 into account, 2020 DAH was $41.2 billion, about 1.8% higher than 2019 DAH. By World Bank income group, DAH remains most relied upon in low-income countries (25.0% [24.4–25.5] of 2018 health spending), while † Our modeled estimates for total health spending are presented with uncertainty intervals. Our estimates of DAH are generally not modeled and do not include uncertainty intervals. Unless otherwise indicated, all estimates are reported in 2020 inflation-adjusted US dollars, and the source for all figures unless otherwise indicated is the Financing Global Health Database 2020. Executive summary | 13 out-of-pocket spending is most relied upon for financing health care in lower-middle-income countries (55.9% [53.7–58.2] of 2018 health spending). Government and prepaid private spending are most prevalent in highincome countries (86.5% [86.0–87.0] of 2018 health spending). In terms of health focus areas other than COVID-19, DAH for HIV/AIDS, malaria, and tuberculosis decreased between 2019 and 2020, going down 3.4%, 2.2%, and 5.5%, respectively. DAH for non-communicable diseases (NCDs) increased by roughly 4.7%, going from $846.9 million in 2019 to $887.0 million in 2020, while our estimates of DAH for newborn and child health as well as reproductive and maternal health show that both decreased between 2019 and 2020: funding for newborn and child health went down 2.6%, while reproductive and maternal health DAH declined 6.8% between 2019 and 2020. Though spending on COVID-19 did not lead to major declines in health focus areas’ development assistance for health between 2019 and 2020, DAH for many health focus areas did not grow, and the pandemic has certainly complicated the development spending landscape, not to mention the critical work of getting care to those who most need it. Reducing the burden caused by conditions like malaria and tuberculosis remains as pressing as ever. Financing Global Health 2020 also includes estimates of future health spending from 2019 to 2050 to help funders and policymakers plan. We estimate global health spending will grow to $9.9 trillion (95% UI 9.7–10.1) by 2030 and $14.4 trillion (13.7–15.1) by 2050. Global disparities will almost certainly remain: high-income spending is projected to grow to $6,023 per person (5,904–6,150) by 2030 and $8,539 per person (8,058–9,065) by 2050. In contrast, low-income spending is projected to grow from $35 per person (34–36) in 2018 (0.6% of 2018 high-income spending) to $46 per person (44–48) in 2050 (0.5% of high-income spending in 2050). Overall, Financing Global Health 2020’s highlights include: • A focus on tracking spending related to COVID-19. These estimates draw on novel work performed by the research team. Our COVID-19 work includes estimates of donor support for COVID-19, including spending commitments and disbursements by disbursing agency, as well as whether funding was redirected to fight COVID-19 or whether it is new. • Updated estimates of overall global domestic spending, now through 2018, and updated estimates of contributions to DAH, now through 2020. • Updated estimates of future health spending, to 2050. • Updated Global Health Financing Profiles for seven health focus areas, including a new profile for COVID-19.

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