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02 March, 2006

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Report of the Commission on Macroeconomics and Health

Macroneconmics and Health

Investing In Health for Economic Development

Report of WHO Commission on Macroeconomics and Health - A Commision Examining the Interrelations Among Investments in Health, Economic Growth and Poverty Reduction

Available to download on http://www.cmhealth.org/ 

 BackGround

The Commission on Macroeconomics and Health (CMH) was launched by WHO Director-General Dr. Gro Harlem Brundtland in January 2000. Over a two-year period, the Commission will analyze the impact of health on development and examine the appropriate modalities through which health related investments could have a positive impact on economic growth and equity in developing countries. It will recommend a set of measures designed to maximize the poverty reduction and economic development benefits of health sector investment.

The Purpose of the Commission:

The purpose of the Commission is to analyze the impact of health on development and to produce reports and scholarly studies on health-related interventions and their impact on economic growth and equity in developing countries. The Commission will recommend a set of health measures to minimize poverty and maximize economic development in these countries. The CMH will consolidate its findings into a final report for dissemination to the international development community and to Ministers of Health at the 2002 World Health Assembly.

The Components of the Commission:

The CMH is composed of the Members, six Working Groups, and the Secretariat. The chair of the Commission is Professor Jeffrey D. Sachs of Harvard University. The Members, Chair, Senior Economist, and Executive Secretary of the Commission were appointed by the WHO Secretary-General.

Overview

To date, there have been very few linkages made between the spheres of public health and macroeconomics. Consider three examples. First, it is clear that poverty predisposes individuals and countries to ill health. Thus, sound macroeconomic policies that reduce poverty will, to some extent, improve health. But it is also clear that ill health perpetuates poverty. Appropriate investments in improved health could provide an important set of instruments for poverty reduction and economic growth. However, there is a lack of specific research or operational tools to place health within an overall developmental agenda. Second, new research commissioned by WHO adds to recent literature suggesting that countries with higher levels of health grow faster and, indeed, improvements in health may account for a significant fraction of the rapid economic growth of much of the world in the 20^th century. Third, the global macroeconomic incentives for research and development of new health technologies have not been well studied. In contrast to health, other sectors such as environment have made substantial linkages to the macroeconomic and developmental agendas, partly by improving the scientific and economic base on which policy can be based.

The increasing use of the International Development Targets, including targets in public health, as the encompassing framework to evaluate the progress in the fight against poverty, is a testament of the increasing recognition of the linkages from improved health to the escape from poverty. Improving health is recognized as a poverty alleviation goal in itself, and is increasingly understood to be an input into improved economic performance.

The World Health Report (WHR) 1999 emphasized health as a key item in the developmental agenda, including a focus on health investments to improve health outcomes of the poorest billion in the world. Dr. Brundtland has drawn on these findings to argue that health should be a major concern of Finance and Prime Ministers. This is particularly so because the development agenda is moving from an exclusive focus on trade and macroeconomic stabilization to a real concern for poverty. Yet health remains far from the top of the development agenda. Many health professionals continue to argue that the health sector itself is only a minor player in efforts to improve the health of populations. And the overwhelming majority of finance officials and development economists agree – or believe – that health itself is relatively unimportant as a development goal or as an instrument for reducing poverty. Thus a major challenge for WHO in the next few years is to stimulate strengthening of the evidence base and to communicate much more effectively what is already known.

In May 1999, WHO and the United Kingdom’s Department for International Development (DFID) organized a meeting called “World Health Opportunity: Developing Health, Reducing Poverty”. This meeting clearly emphasized WHO’s role as the lead technical agency on health to provide the analytic and operational basis for health to be at the “heart” of development.

WHO’s response

A key WHO response to this consultation, in line with the conviction that health is an issue of importance to macroeconomic specialists, was the creation of the Commission on Macroeconomics and Health (CMH) by Dr. Gro Harlem Brundtland, in January 2000.

The goal of the Commission is to place health at the top of the development agenda. The premise is that the health sector is a major player in efforts to improve the economic well-being of populations in general, and in reducing poverty in particular. Thus, the Commission is a crucial part of WHO’s strategy to meet the challenge of assembling and analyzing the evidence linking health status and poverty reduction. The Commission will seek to communicate its findings in this area effectively to policy makers in national governments and development professionals in development agencies.

Why is WHO involved in macroeconomics?

It is clear that WHO’s comparative advantage is in technical advice on health and not on macroeconomics. The rationale behind WHO’s involvement in macroeconomics is twofold. First, the CMH is a continuation of WHO’s emphasis on evidence. By critically examining selected key aspects of health and development, the CMH is increasing the set of tools and policy conclusions available to ministries of health and finance. Second, the CMH is helping relate key aspects of WHO policy (such as financing health services for all, but not all health services) into practical issues that must be addressed by ministries of finance (e.g. types of tax systems to use in different settings).