Health is one of the main markers of societal success, and a proper allocation of budget in the sector is of paramount importance. Health expenditure is the amount of money spent by citizens and the government on health related expenses out of the total income. Health expenditure includes all costs for medical care, disease prevention, health promotion, rehabilitation, environmental health activities, health service administration and regulation and capital formation with the predominant goal of boosting public health.
The indicator total expenditure on health as a percentage of gross domestic product (GDP) is defined as the level of total expenditure on health expressed as a percentage of GDP, where GDP is the value of all final goods and services produced within a nation in a given year. It provides information on the level of resources channeled to health, relative to a country’s wealth.
Although increasing health expenditure is associated with better health outcomes, especially in low-income countries, there is no ‘recommended’ level of spending on health. When a government attributes proportionately less of its total expenditure on health, this may indicate that health, including nutrition, is not regarded as a priority.
According to our analysis from WHO’s Global Health Observatory dataset, Ethiopia has the second lowest per GDP health expenditure in East Africa with a 10-year cumulative percentage of 4.34% from 2010 to 2020.
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