National Health as a Driver of GDP
Translated from Russian with the help of AI. Original: Russian version
National health affects GDP through labor hours and drives health care spending, especially in mandatory social health insurance. Prevention, such as regular check-ups, nutrition, exercise, vaccination and a healthier environment, should therefore be treated as economic policy.
GDP and Health Care
Gross domestic product (GDP) depends on the value added (VA) a country generates in a given period. I won't delve into the theory of what value added is, but it is important to understand that labor is one of its key factors. Labor's contribution to GDP depends entirely on human resources and their quality. Quality means the skills and abilities our human resources possess (which is a matter of education). Quantity depends on the number of labor hours devoted to creating value added. Labor hours depend on many factors, but one of the most significant is the number of healthy workers. Health care therefore has a substantial influence on GDP through labor hours. I wonder whether anyone here has ever counted the number of person-hours lost to sick leave, year by year.
Moreover, the healthier a nation is, the less it has to spend on health care. This matters especially for mandatory social health insurance. The Social Health Insurance Fund (SHIF) is the main beneficiary of a healthy nation.
That is why I believe one of the Ministry of Health's tasks should be a program to improve the overall health of the population.
I remember learning, when I was in South Korea, that the entire working-age population undergoes a check-up, the cost of which is covered by their insurance. Preventing disease at an early stage is far cheaper, and it affects the number of working hours across the country as a whole.
Proper nutrition, exercise, a clean environment, check-ups, vaccination, hygiene and so on are all proactive measures to improve the nation's health, and they affect both GDP and health care costs. Treating the sick is reactive policy. Unfortunately, I have not personally seen whether we have a comprehensive national program to improve the population's health. There is now a great deal of data that could give us a good picture of what leads to illness.
I think that paying greater attention to health care would do more for GDP than some less obvious direct measures. After all, health care is about protecting health, not just treating its consequences.
Published in: Facebook, 23 June 2021