The impact of health care expenditure on health indicators: an empirical analysis in middle income countries

Objective (s): This paper investigates the impact of health expenditure on health status for 68 middle income countries over the period 1980-2011.

Random effects panel data regression model was fitted to determine the effects of health care expenditure on health outcomes.

The results showed that health care expenditure significantly influences health status through improving life expectancy at birth، reducing death and infant mortality rates. Both public and private health care spending showed strong positive association with health status. Although public health care spending had relatively higher impact on reducing death and infant mortality rates، private health care spending had relatively higher impact on life expectancy at birth.

The findings suggest that health care expenditure is one of the most important determinants of health status across countries. Therefore increasing resource allocations to health sector can significantly improve health outcomes.