The debate around universal health coverage (UHC) and the best ways to achieve it has come under the spotlight lately. The 2010 World Health Report reinforced calls for a push towards UHC across countries, broadly defined as providing all people with access to needed health services of sufficient quality to be effective, without financial hardship associated with their use. Although the potential link between health system coverage and population health has played a crucial role in that debate, the expected relationship between population outcomes and different proxies for system coverage is ambiguous in theory, with much of the available empirical evidence mirroring such indeterminacy.
The main goal of this study is to contribute to the UHC debate by providing robust empirical evidence on the causal link from national levels of health system coverage to population outcomes. We assemble a large panel dataset available at the cross-country level, with annual data for the period 1995-2008 encompassing 153 developing and developed countries. We measure the level of health system coverage through indicators of pre-paid (pooled) public and private health expenditure and immunization rates, to try to capture effective access to needed care and protection from financial hardship due to health payments. Population health is measured by the under-five mortality rate and female and male adult mortality rates. We use a two-step instrumental variables approach that directly estimates the reverse causal effects of under-five and adult mortality on coverage indicators, so as to explicitly adjust for these impacts when estimating the effects of health coverage on mortality outcomes. We subject this model to a battery of specification and robustness tests, and also examine differential effects of the coverage variables according to country income levels.
Taken together, our results strongly indicate that expansions in health system coverage lead, on average, to improved general population health. Higher government health spending per capita is consistently found to reduce both child and adult mortality rates. The estimated gains are the largest when under-five mortality is examined and are larger for low and middle income countries than in the full sample. Based on the results for under-five mortality and public health spending, the implied marginal cost of saving a year of life is just around US$1,000 in the full sample of countries. For the average country, pre-paid public spending seems more effective in reducing mortality than prepaid private insurance funds. Higher immunization coverage is also found to decrease mortality rates. Thus, our study offers hard evidence that investing in broader health coverage can generate significant gains in terms of population health.