Spending on healthcare is rising faster than economic growth according to a report from the Organization for Economic Co-operation and Development that found that its member countries average ratio of health spending to GDP rose to 9 percent in 2008 from 7.8 percent. Factors pushing health spending up—technological change, population expectations and population aging—will continue to drive cost higher in the future.

In some countries the recent economic downturn, with GDP falling and healthcare costs rising, led to a sharp increase in the ratio of health spending to GDP. Governments of most OECD countries shoulder the lion’s share of healthcare costs. The percent of government expenditure devoted to health increased in most countries, rising from an average of 12 percent in 1990 to an all-time high of 16 percent in 2008. Given the urgent need to reduce their budget deficits, many OECD governments will have to make difficult choices to sustain their healthcare systems such as curbing the growth of public spending on health, cutting spending in other areas, or raising taxes.

The United States spent $7,538 per person on health in 2008, well more than double the $3,000 average of all OECD countries. The next biggest spenders, Norway and Switzerland, spent much less than the U.S. per capita but still some 50 percent more than the OECD average.

While new medical technologies are improving diagnosis and treatment, they also contribute to the increase in health spending, according to the report. OECD Health Data 2010 shows that there has been rapid growth in the supply and use of computed tomography (CT) scanners and magnetic resonance imaging (MRI) units used for diagnostic purposes. MRI units per capita more than doubled on average across OECD countries between 2000 and 2008, reaching 13 machines per million people in 2008, up from 6 in 2000. The number of CT scanners rose to 24 per million people, up from 19 in 2000. The number of MRI units per capita is much greater in Japan, the United States, Italy and Greece than in other countries. These countries, along with Australia and Korea, also have more CT scanners.

MRI and CT scanners are expensive to buy and to operate. There are big differences in their use per capita—far more in the United States than in Canada, France or the Netherlands. The rapid growth in these diagnostic procedures over the past decade in the United States has raised concerns that some imaging may not be useful. To reduce unnecessary procedures and cut costs, many OECD countries are trying to promote rational use of costly medical technologies.

OECD Health Data 2010 is the most comprehensive source of comparable statistics on health and health systems across the 31 OECD countries, including Chile as a new member this year, and 3 prospective members--Estonia, Israel and Slovenia. The interactive database covers the period 1960 to 2008 and can be used for comparative analyses on health status, risk factors, resources and utilization, expenditure and financing, coverage by public and private parties, and the pharmaceutical markets.

Health expenditure as a share of GDP, 2008 (or latest year available)
Country	Total expenditure on health	Public expenditure on health	Private expenditure on health
United States	16.0	7.4	8.5
France	11.2	8.7	2.5
Switzerland	10.7	6.3	4.4
Austria	10.5	8.1	2.4
Germany	10.5	8.1	2.5
Canada	10.4	7.3	3.1
Belgium 1	10.2	7.4	2.8
Netherlands	9.9	7.4	1.6
Portugal	9.9	7.1	2.8
New Zealand 1	9.8	7.9	1.9
Denmark	9.7	8.2	1.5
Greece	9.7	5.8	3.8
Sweden	9.4	7.7	1.7
Iceland	9.1	7.6	1.5
Italy	9.1	7.0	2.1
Spain	9.0	6.5	2.5
OECD	9.0	6.5	2.4
Ireland	8.7	6.7	2.0
United Kingdom	8.7	7.2	1.5
Australia	8.5	5.7	2.8
Norway	8.5	7.2	1.3
Finland	8.4	6.2	2.2
Japan	8.1	6.6	1.5
Slovak Republic	7.8	5.4	2.4
Hungary	7.3	5.2	2.1
Luxembourg	7.2	6.5	0.7
Czech Republic	7.1	5.9	1.2
Poland	7.0	5.1	1.9
Chile	6.9	4.1	2.8
Korea	6.5	3.6	2.9
Turkey	6.0	4.1	1.9
Mexico	5.9	2.8	3.1
Source: OECD HEALTH DATA 2010, June