Public Expenditure and Health Status in Ghana

Abstract

Better health status is described as an indicator of economic success or failure of nations. The availability of health care services and the physical, biological and socioeconomic environment, in which a person lives, broadly determine disease pattern, health status and therefore, the quality of life. This paper examines the relationship between public spending and health status in Ghana, using simple but conventional econometric techniques. One measure of health status [under five-mortality rate (per 1000 live births)] was used as an indicator of health status. The results revealed that the availability of physicians and health insurance are the most important determinants of health status in Ghana. Contrary to findings from earlier studies however, the analyses found income per capita to be a rather insignificant determinant of health status. The policy implications that emanate from this paper based on the results are that the health sector is interlinked with socioeconomic development and therefore, the government of Ghana must not treat the health services in isolation but in an integrated manner to achieve the broader goals of poverty reduction, human capital formation and economic development. The results support the hypothesis of increasing public investments in health, especially in the area that will attract the training and the supply of more physicians. The results also show that the national health insurance policy is a positive determinant of health status and, therefore, much education is needed to enlighten and attract Ghanaian into registering and subscribing to it. Government should also make money available for the purchase of drugs and treatment under the health insurance scheme to ensure its growth and sustenance.

Keywords: physicians per population, GDP per capita, national health insurance, health status mortality rate.