Long-term trends

In terms of total health spending per capita, the United States is way ahead of the next highest spending countries – Luxembourg, Switzerland and Norway, and well over double the unweighted average of all OECD countries. At the other end of the scale, Poland, the Slovak Republic, Mexico and Turkey spend well below half the OECD average.

Since 1990, health spending has grown faster than GDP in every OECD country except Finland, although this growth has not been constant. For example, between 1997 and 2004, health expenditure increased by 4.3% per year on average, twice the overall economic growth rate. This compares with the previous period (1992-1997), when the growth rate of health expenditure was 2.6% – only slightly above that of overall economic growth.

In most OECD countries, the bulk of healthcare costs is financed through taxes, with 73% of health spending on average publicly funded in 2004. Ensuring sustainable financing of health systems is critical for governments, as health spending as a share of GDP is projected to increase further due to costly new medical technologies and population ageing.

Although the public share of health spending has fallen in countries such as Poland, Hungary and the Czech Republic which had a relatively high public share of health spending in 1990, it has risen in countries where it was low, such as Korea, Mexico, Switzerland and the United States. In Korea, for example, the public share of health spending rose from 39% in 1990 to just over 50% in 2004. In the United States, it increased from 40% to 45% between 1990 and 2004. Although the private sector in the United States continues to play the dominant role in financing, public spending on health per capita is still greater than that in most other OECD countries, because overall spending on health is much higher than in other countries.