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Health care and long-term care

Demographic change will have a major impact on our society and public spending, particularly healthcare spending. Demand for healthcare and long-term care in the EU is sizeable, and its potential benefits are high. However, those benefits come at a cost: public spending on healthcare and long-term care in the EU came to 8.5% of GDP (gross domestic product) in 2013.

Given the scale of public expenditure on healthcare and long-term care and the need for fiscal responsibility throughout the EU, healthcare spending is central to the policy debate on how to keep public finances sustainable in the long term.

The 2 types of care are interlinked. While healthcare focuses on improving patients' health, long-term care is intended to provide a better quality of life for people with chronic conditions. Public expenditure on both depends on factors affecting supply and demand.

Demand-side determinants include:

  • population size
  • age distribution
  • health & disability status
  • individual & national income
  • rules regulating access to healthcare goods & services.

Supply side determinants include:

  • availability of healthcare
  • distance to such services
  • technological advances
  • the institutional framework regulating the provision of healthcare goods & services.

EU healthcare projections, 2013-2060

The Commission's Directorate-General for Economic and Financial Affairs (DG ECFIN) uses models to make projections of spending on healthcare and long-term care for 2013-2060. Total future spending is calculating on the basis of:

  • population projections
  • disability rates
  • age-related expenditure profiles
  • unit cost developments for various components of care provision.

Various scenarios are used to project the budgetary effect of possible future developments in a number of factors affecting public health and long-term care spending, including:

  • changes in health status
  • disability rates
  • income elasticity of demand
  • developments in unit costs.

Demographic ageing alone may push up public spending on health and long-term care in the EU by as much as 10% of GDP by 2060. Other factors - technological advances or higher costs - may push up spending still further. However, EU countries' future spending trends still differ considerably. With demand for healthcare and long-term care services growing, they need to be managed more efficiently.

Read more in the 2015 Ageing Report.

EU health care systems - efficiency

Healthcare expenditure grew faster than national income in all EU countries for most of the second half of the 20th century. However, higher spending does not always produce better results.

Measures of good health vary considerably even among countries that spend the same amount on healthcare, suggesting that some systems are more efficient than others.

The health of a population is influenced by factors including:

  • quality of healthcare
  • education
  • income
  • environment
  • lifestyles.

All the EU countries could improve healthcare outcomes by spending more efficiently. Some have great potential for improvement in this regard.

To find out more, see: Efficiency estimates of healthcare systems

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