Financing needs, spending projection, and the future of health in Brazil

Abstract

In this paper we adopt a growth accounting projection model to estimate and characterize health-financing needs in Brazil as well as to assess the extent to which financing needs may diverge from spending capacity in the future. We estimate an annual increase of 0.71% in the share of projected financing needs relative to GDP, with excess growth rates being 0.74% and 0.69% for the public and private health sectors, respectively. Institutional reforms and public spending restrictions may leverage public-private segmentation in health financing throughout the next decades, thus potentially leading to losses of equity in the system. Our projections contribute to a scant empirical literature on health financing sustainability in low- and middle-income countries and shed light on the role of spending capacity and institutional constraints over the path towards universal health coverage.

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