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Are we sick of this crisis?

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Are we sick of this crisis?

Without second thought, you’d say Yes, I am sick, tired of the current economic situation. However, have you ever wondered if you are getting sick because of it?

Probably you haven’t and now, intuitively, you may be tempted to answer positively.  The rising unemployment leads to a reduction in household consumption and tax revenues, which imply that countries cut in the national budgets, including the health one. To do so, you think, countries may introduce/increase user charges, increase the waiting times or reduce the scope of services/population covered. Even though this doesn’t affect your health directly, it might do so indirectly.

While research on previous crises actually confirms the first intuition, the policy tools suggested are highly questionable – they interfere with the equitable access and quality of care and may undermine the health system in the long-term -, so the number of countries that reported its use on the actual crisis in Europe is surprisingly small. [1]

Given this new data, you may change your first answer to “my health remains unchanged”. Once again, a quick look through some bibliography can prove you wrong. [2]

In fact, research suggests that the health status of populations may actual improve during economic downturns, and many arguments may be pointed out: more leisure time allows people to exercise more; over-consumption of food, alcohol and tobacco decreases; and road-traffic and work-related accidents decrease.

Even though the suicide rate tends to rise and the mental health status tends to worse, researchers say that if these hazardous effects are mitigated by adequate support programs, the health benefits of economic crises tend to overweight the risks, at least in the short-term.

Noting the counterintuitive nature of these results, I tried to find empirical evidence of them, studying the Japanese case.

When we look at the Japanese governments’ health expenditures, we clearly see sharply decreases during crises periods.

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The first cut followed the 1997s Asian Crisis and was integrated in a boarder policy of fiscal consolidation, aimed at cutting government spending (Japan’s situation, in the 1990s, was the worst of any G7 country). The government decided to raise tax rates, to end some subsidies and to increase the patient co-payments under the national health insurance. [3] The severe recession and the rising unemployment that followed lead to a reduction of tax revenues, aggravating this effect.

Although the second decline precedes the rise of the current crisis, it may correspond to a similar austerity policy to reduce Japanese high debt.

Looking at the non-medical indicators, we indeed notice a slight decrease in the percentage of daily smokers in 1997, as well as in 2007, which may be a reflect of financial constraints (eg. unemployment or rising taxes).

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We can also notice a small reduction in the rate of accidents – either labor-related or traffic accidents -, whose link to the crisis might, however, be questionable due to the persistent pattern till the present.

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Even though these results are insufficient to confirm the effect suggested by literature, they at least give us a different perspective of crises periods. In fact, every coin has two sides and despite the catastrophic economic consequences, crises may be an opportunity to improve the efficiency of health systems, as well as the population health status.

Ana Margarida Lemos

[1][2] Philipa Mladovsky, Divya Srivastava, Jonathan Cylus, Marina Karanikolos, Tamás Evetovits, Sarah Thomson, Martin McKee. Health policy responses to the financial crisis in Europe. European Observatory on Health Systems and Policies. 2012.

[3] Toshihiro Ihori, Toru Nakazato, Masumi Kawade. Japan’s Fiscal Policies in the 1990s. 2006.

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Author: studentnovasbe

Master student in Nova Sbe

One thought on “Are we sick of this crisis?

  1. I don’t get why you don’t present numbers for the total number of deaths or total number of patients (both outpatient and inpatient, ie the one’s who stay in the hospital and the ones who don’t) or even the consumption of medicines.

    Using the Japanese example might be a bit of an outlier (as far as I know it has the society with the highest life expectancy, at least for women).

    The idea is good though.

    Gustavo.