Medical Services See Major Gains In Emerging Markets
BMI’s newest core view is that private healthcare spending as a percentage of total healthcare expenditure in emerging markets will decrease over the medium term. Governments in these countries increasingly appreciate the value of a healthy population and are boosting investment in medical services, such as pharmaceuticals, diagnostics, doctors, nurses, clinics and hospitals.
Notable public sector healthcare projects in emerging markets include:
- Mexico’s Seguro Popular social insurance system, which reimburses treatment in all cases where ‘catastrophic’ costs were likely to be incurred. Key beneficiaries are those on low incomes and people living in rural areas.
- Russia’s DLO (Dopolnitelnoe Lekarstvennoe Obespechenie) scheme, which covers medicine costs for certain pensioners, war veterans and low-income families in a bid to improve their level of healthcare.
- China’s CNY850bn (US$125bn) healthcare reform programme, which will widen insurance coverage to include many more of its vast rural population, as well as to build thousands of community healthcare centres over the next three years.
Private Healthcare Spending As A Percentage Of Total Healthcate Expenditure In A Selection Of Emerging Markets
However, it is important to note that not all emerging markets are following this trend, and private sector spending is still increasing in absolute terms. Using data from the World Health Organization (WHO), BMI has looked at expenditure on medical services for the six main emerging markets: China, India, Turkey Brazil, Russia, and Mexico. With the exception of Turkey, all countries are forecast to see a decline in private healthcare spending as a percentage of total healthcare expenditure through to 2018.
Private Healthcare Spending As A Percentage Of Total Healthcate Expenditure In A Selection Of Emerging Markets
It is significant to note that this is a recent trend. If BMI had used WHO data from 1998-2001 in our forecast model rather than numbers from 2005-2008, five of the six countries would see an increase in private healthcare spending as a percentage of total healthcare expenditure over the medium term. Exposing the fallibility of forecasting, Turkey would be again the exception to the trend.