A key to slower health spending growth worldwide will be unlocking innovation to reduce the labor-intensity of care

Abstract

Many factors combine to drive the growth in health spending worldwide, but the introduction of new technologies, drugs, and therapies is probably the most important. However, in contrast to other industries, innovations in health care have not tended to reduce the need for labor. In fact, labor still accounts for the largest proportion of expenditures in many health systems. But labor-saving technologies, workforce innovations, and patient self-care approaches are now emerging and altering health care's labor structure. For example, in Mexico more than one million households pay $5 per month to access a health advice hotline before setting foot in a physician's office. In India assembly line-style eye surgery has dramatically reduced cost without sacrificing quality. Policy makers should focus on such labor-saving innovations; reform reimbursement systems to encourage them; tackle professionals' resistance; and remove regulatory barriers. Bold experiments to redesign health services around patient self-care approaches are also warranted.