Where to Invest Public Health Dollars in Developing Countries?

How should foreign governments, NGOs, and aid organizations invest public health dollars in developing countries? Should funding support progams focused on specific diseases or should they support broader initatives aimed at boosting entire health systems? Do local governments deserve aid money, or should local NGOs receive financing? No one has definitive answers for these questions, and a recent study showing that aid money to developing nations shrinks domestic governmental health outlays only complicates the debate.

 

 

The study, authored by Chunling Lu, appeared in the April edition of the Lancet medical journal. Dr. Lu's group studied international and domestic expenditures on health programs in developing countries and charted the changes in these fuding sources between 1996 and 2005. Their results showed that although overall domestic health spending increased in these countries, input of foreign aid dollars caused domestic governments to reduce funding for health programs. Specifically, the researchers observed that every US$1 of foreign money causes a mce_marker.43 - $1.14 decline in local spending. This means that in some cases money from outside sources causes a net decline in a country's overall health spending. Although finance ministries might funnel the money away from health and toward other programs that improve health - such as housing or infrastructure initiatives - this finding requires foreign health funders must further scrutinize investments. They must decide if spending "at least $1.75 to improve a local government's health spending by $1" adds value to the health system.

 

This requirement for scrutiny in foreign health investments only adds to the burden felt by groups investing in international health programs. These groups, such as the WHO and the Gates Foundation, already face tough decisions such regarding whether to invest in horizontal or vertical public health campaigns. Previously, popular consensus dictated a vertical approach to fighting disease. This meant that health officials targeted a single disease for eradication through vaccinations campaigns, medication efforts, mosquito reduction, or some combination of a few specific measures. New bias toward horizontal campaigns has complicated spending decisions. Whereas the vertical approach aims to exterminate one disease - sometimes at the expense of other health concerns - horizontal campaigns bolster health systems broadly. Robert Guth discussed this shift in a recent Wall Street Journal article ('Gates Rethinks His War on Polio,' 4/23). In the article, Guth highlights the Gates Foundation's changing strategy after hitting hurdles in their effort to eliminate polio. Ano also wrote about the vertical vs. horizontal public health campaigns in a recent Justmeans post. His work highlights two recent studies authored by experts on opposite sides of the debate. 

 
Although Dr. Lu's study complicates the decisions facing international health aid groups, the research might also spur positive results. For example, the group recommends more careful documentation of health spending and outcomes in developing countries. Hopefully both horizontal or vertical public health campaign advocates operationalize these recommendations to improve their programs and show the value they add to the local community.

Dr. Lu's' study can be found by searching for the following digital object identifier: (doi:10.1016/S0140-6736(10)60233-4).

Photo credit: defense.gov