Justifying increased health budget for improved healthcare

Bangladesh has made notable strides in its health sector, earning accolades both nationally and internationally. Yet, beneath these achievements lies a troubling reality: the sector is riddled with inefficiencies and weaknesses, starkly exposed by various national and international emergencies including Covid-19. This has brought to light the urgent need for increased investment in healthcare.
Despite repeated warnings from experts about rising out-of-pocket expenses and the crippling financial burden of high medical costs, timely actions have been few and far between. The urban population, in particular, suffers from a lack of proper healthcare infrastructure. The government's response has often appeared uncertain and inadequate.

Currently, Bangladesh allocates a mere fraction of its GDP to health. Worse still, this allocation has been declining or has remained almost the same. Mismanagement and corruption siphon off much-needed funds, leaving a pitiful amount for a sector. Consequently, out-of-pocket expenses dominate health financing, pushing about five million people into poverty each year. The goal of achieving Universal Health Coverage (UHC) remains a distant dream unless immediate action is taken.
Increasing the health budget is not just necessary-it is imperative. The funds are crucial for implementing essential reforms and improvements currently stalled by inadequate funding. For example, overhauling the health system to include compulsory universal pre-payment mechanisms like social health insurance would relieve the financial burden on citizens. But such sweeping changes require substantial investment. Even though Bangladesh economy falls short of formal employment needed for such initiative to work, the lack of capacity will remain a hurdle for long.
The government's current capacity to manage these reforms is woefully limited. The corporate insurance sector is equally unprepared. Moreover, healthcare services are overwhelmingly concentrated in big cities, making it difficult to implement effective insurance mechanisms. A larger budget is essential to expand and distribute healthcare services more equitably.
An increased health budget would also strengthen governance, enhance service capacity, and foster innovative financing. The poor quality of public healthcare forces many to seek unregulated private services, exacerbating the financial strain. Clear clinical guidelines and regulated pricing for diagnostics and other healthcare costs are essential. Hospitals need to be categorized by quality, with corresponding pricing, and a robust monitoring system must be established. These measures require significant financial resources, justifying a budget increase.
Pharmaceutical prices are another major driver of out-of-pocket expenses. Companies often produce unnecessary drugs to bypass regulated prices. Increased funding can support stronger regulatory frameworks to curb this exploitative practice. While Bangladesh boasts extensive health infrastructure, the quality of primary care services must improve to make these facilities effective and reduce out-of-pocket payments. This improvement necessitates increased financial resources.
Moreover, improving support services at government facilities is crucial. Employer-based insurance for formal and large corporations could improve risk pooling, although it risks widening rural-urban disparities. Policymakers must also consider those just above the poverty line and make strategic purchases to reduce costs. These initiatives, too, require a higher health budget.
Preventative care, which is cost-effective and reduces future curative expenses, must be prioritised. Increased investment in preventative care is essential for reducing overall healthcare costs and improving health outcomes. In addition, inclusion of much needed services such as mental health services, geriatric services-that are significantly missing in the current system-would necessitate more resources. Discouraging unhealthy habits such as tobacco consumption requires combinations of policies-both tax and non-tax measures.
The complexity of the health system means there is no simple solution. Policies must be context-specific and evidence-based, with good governance to optimise resource allocation. While a robust long-term health system is crucial, immediate steps can significantly reduce out-of-pocket expenses and improve healthcare quality. Increasing the health budget is a critical step in making these necessary changes.
The time for complacency is over. It is time for Bangladesh to invest in the health of its people. Inclusion of new services and improving the quality of care requires resources. Hence, boosting the health budget is not just a financial imperative-it is a moral one.

Shafiun Nahin Shimul PhD, Professor Institute of Health Economics, University of Dhaka. [email protected]