Central America’s healthcare systems have several budgetary ‘flaws’

By Fátima Romero

Health system coverage in Costa Rica reaches 92% of the population, in the Dominican Republic 71%, in Panama 63%, and in Guatemala 17%, according to regional studies presented this week.

These countries continue to present challenges in terms of access and coverage of health services, as well as in investment and budget execution, according to one of the studies that the Central American and Caribbean Federation of Pharmaceutical Laboratories (Fedefarma) presented at a web conference.

According to the report on health investment and budgets made by Sanigest International, even though the four countries analyzed are performing adequately in budget reliability and transparency of public finances, “it is still a challenge to ensure the sustainability of health systems over time and adequate coverage”.

The latter can be achieved with better management of economic resources, explains the research, which is why it recommends reviewing the budgetary vices of health systems, including remuneration and current transfers, which account for up to 77% of the budget of public institutions.

It also suggests analyzing the lack of liquidity of health services, duplication of procurement processes, delinquency, and labor informality while implementing budgetary mechanisms linked to quantifiable achievements in health systems in the short and medium term.

HEALTH ECONOMICS IN CENTRAL AMERICA

The other study, “The State of the Health Economy in Costa Rica, Guatemala, Panama, and the Dominican Republic”, prepared by Fedefarma in conjunction with the WifOR Institute, analyzes how the health sector contributes to the overall wealth of Central American society.

“Despite low investment in healthcare, the healthcare economies in these countries are engines of growth in the region, being major contributors to national GDP and job generation,” said María Cristina Álvarez, consultant at WifOR, who spoke in a webinar to present the study.

According to the study, the health economy creates an economic footprint of more than US$50 billion between the four countries, more than the Bolivian GDP.

It also employs 10% of the labor force, generating around 2.2 million jobs larger than the labor force of Uruguay.

The research also proposes that the States increase their investment in health as a tool to boost economic and social development, productivity, and citizens’ quality of life.

However, it warns that “international experience indicates that an increase in resources does not necessarily lead to a better health system in the absence of tools to measure and improve results”.

Fedefarma also suggests “a paradigm shift for governments to stop seeing investment in health as an expense and see it as a long-term investment that will translate into socioeconomic growth.”

Another of the conclusions shows that investment in health directly impacts the economy of the countries and that the percentages of investment allocated and budget management practices still require a collaborative effort to achieve maximum efficiency.

According to official data, in Costa Rica and Panama, public spending on health ranges between 5% and 5.3% of the Gross Domestic Product (GDP), but in Guatemala, it is 2.4%, and in the Dominican Republic, 2.7%.

With information from Bloomberg