The economic impact of the disease is a critical issue for global health, with important ramifications for public health policies, budget allocations for health services, and economic growth. The Third International Conference on Global Health Economics, held in Rwanda in 2019, was a major landmark in the global effort to design innovative financial strategies to curb the economic impact of disease. We focus here on the main financial strategies and discussions that emerged from the Kigali Rwanda conference, and we show how such approaches can optimize the use of resources, enhance disease prevention, and strengthen health services. In less than five generations, the world has shifted from widespread disease, hunger, and fear to a situation where these issues persist mainly in prosperous areas, while new health challenges emerge in many other regions.
The Economic Impact of Disease
Diseases, particularly infectious diseases, can have profound economic consequences, including:
Healthcare Costs:
Direct costs such as medical treatments, hospitalizations, and medications.
Indirect costs include loss of productivity, long-term disability, and premature mortality.
Economic Productivity:
Diseases can impact productivity by causing such absenteeism or, even worse, by causing impairment of productivity when people who are ill go to work.
Some of these long-term health issues can negatively impact the earning capability and economic well-being of those affected and their families.
Healthcare System Strain:
High disease burdens can place considerable stress on health care systems, siphoning off resources from other essential services and making it difficult to obtain funding and build infrastructure for the future.
Economic Development:
Poor and widespread health conditions can hamper economic growth and development by negatively affecting human capital, reducing economic growth, and increasing poverty levels.
Financial Strategies Discussed in Kigali
At the Kigali conference, governments and development partners identified a range of financial strategies to make health systems more resilient and to use healthcare investments as efficiently as possible. Among the solutions proposed:
Innovative Financing Mechanisms:
Health Bonds: Health bonds were recommended as a mechanism for raising funds for programs to prevent and control disease. These are government or international agency bonds issued to investors keen to support health programs at a density equal to their investment return.
Impact Investing: Investing in projects or companies that seek to create social or environmental impact alongside the potential for acceptable financial returns. Impact investing in health can support innovations in disease treatment and prevention, and provide financial returns to investors.
Public-Private Partnerships (PPPs):
Collaborative Funding Models: Public-private partnerships (PPPs) were a prominent theme and served as a reminder of how interventions can pool resources (and skills) from both sides to additionality, and increase efficiencies in health care delivery through dividing risks and costs.
Case Studies: Disease control will also benefit through the case studies presented at the conference on successful PPPs in healthcare. The proposed memorandum of understanding will also facilitate improved healthcare infrastructure and overall disease control with the guiding principles, best practices, and standards for successful PPPs.
Cost-Effectiveness Analysis:
Evaluating Interventions: The most important step towards considering health as a global public good was, in their words, focused on ‘economic valuation most especially the development of cost-effectiveness analysis for evaluating the economic value of diverse health-care interventions about the cost per health outcome achieved’.
Resource allocation: CEA aids in the selection of life-saving interventions that are most cost-effective so that the maximum health benefits can be realized using existing resources.
Disease-Specific Financing Models:
Global health funds, such as the Global Fund to Fight AIDS, Tuberculosis, and Malaria, were discussed. Countries eligible for this program receive funding to support disease-specific initiatives that enhance both overall and targeted health outcomes.
Models at the Country Level: The conference looked at local financing models tailored to the specific contexts and needs where disease challenges occur. Such approaches should strengthen local capacity to manage the disease and match funding with national health priorities.
Insurance and Risk Mitigation:
Health insurance schemes: To cover the costs of a can be effective. Disease might cause stress in the family but health insurance to cover the treatment costs can reduce the financial burden. In addition, insurance acts as a financial protection for the patient against catastrophic health expenditure and also improves access to appropriate treatment.
Risk pooling: This concept encourages the distribution of financial risk associated with disease across a larger population, reducing volatility in healthcare costs and providing better financial protection to individuals.
Economic Incentives for Prevention:
Preventive Care Investments: The conference emphasized preventive care as the most inventive way to minimize the economic cost of disease over the long term. This involves funding vaccination programs and programs involving health education, and regular health check-ups while detecting diseases early.
Behavioral Incentives: Rewarding people for preventive behaviors such as annual health screenings or healthier lifestyle choices to reduce disease incidence and thereby reduce costs.
Lessons Learned from Kigali
The conference in Kigali came up with several conclusions about the economics of disease as well as financial strategies:
Need for Integrated Approaches:
The only way to tackle the scourge of disease is in a multi-pronged fashion, combining innovation finance, PPPs, and cost-effectiveness analysis. Integrated approaches maximize the use of resources and ensure that what is done is done well.
Importance of Collaboration:
Successful financial strategies often feature strong, long-standing partnerships between governments, the private sector, and international organizations. These partnerships enhance resource mobilization, strengthen delivery capacities, and improve health outcomes.
Focus on Equity:
This includes ensuring that financial strategies to address health disparities are aimed at and reach those who are most at risk for, and already disproportionately affected by disease burdens. Providing equitable access to health resources and interventions helps to mitigate the cancerous economic impact of disease when it occurs in the most at-risk populations.
Data-Driven Decision Making:
We need to direct money towards programs and interventions that work, and that means using data and evidence at all levels of decision-making. A data-driven approach to health can make sure that resources are distributed based on need and efficacy.
Long-Term Vision:
Financial strategies should foster resilience to future shocks as well as meet pressing needs, to support health and economic development. Investment in long-term health infrastructure, disease prevention, and research will support resilient health systems.
Moving Forward
Now that the health challenges of the world are changing, the lessons from Kigali are a useful blueprint for approaching the economic burden of disease. Through more creative financing mechanisms, increased public-private partnerships, and more cost-effective programs, decision-makers can help make disease control a more efficient and effective use of global resources.
The next step is to implement this strategy, work collaboratively, and direct financial resources toward initiatives that maximize benefits across the health spectrum and effectively improve global health. In addition, by developing a robust and inclusive economic approach to diseases, we can begin to create a healthier and more socially just world. Ultimately, these efforts will foster not only improved health outcomes but also greater equity and sustainability in global health initiatives.
Moreover, the deliberations and conclusions of the Kigali conference highlight the importance of making economic issues more central to the management of disease and health policy. This shift will establish the foundations of a new approach that will help governors make informed decisions about how to support and strengthen health systems in the future.
