How Important Are Health Care Expenditures for Life Expectancy? A Comparative, European Analysis

Abstract

Objectives: The relationship between health care expenditures and health care outcomes, such as life expectancy and mortality, is complex. Research outcomes show different and contradictory results on this relationship. How and why health care expenditures affect health outcomes is not clear. A causal link between the two is not proven. Without such knowledge, effects of increase/decrease in health care expenses on health outcomes may be overestimated/underestimated. This study analyzes the relationship between life expectancy at birth and expenditures on health care, taking into account expenditures of social production and education, as well as the quantity and quality of health care provisions and lifestyles.

Design: This is a cross-sectional study, analyzing national data of 31 European countries. First, the bivariate correlation between the dependent variable and independent variables are calculated and described. Next a forward linear regression analysis is applied.

Measurement: The data are derived from standardized, comparative data bases as available in the Organisation for Economic Co-operation and Development and Eurostat. Health care expenditures are assessed as a percentage of the Gross Domestic Product (GDP).

Results: Health care expenditures are not the main determinant of life expectancy at birth, but social protection expenditures are. The regression analysis shows that in countries that spend a high percentage of their GDP on social protection, that have fewer curative beds and low infant mortality, whose citizens report fewer unmet health care needs and drink less alcohol, citizens have a significant longer life expectancy.

Conclusion: To realize high life expectancy of citizens, policy measures have to be directed on investment in social protection expenditures, on improving quality of care, and on promoting a healthy life style.

Keywords: Health care expenditure; life expectancy; life style; quality of care; social protection.