Why is Rwanda an Exemplar?

Health system efficiency and primary health care

As a 2010 WHO paper explains, efficiency in health systems refers to “attaining the highest level of health possible with the available resources.”¹ That means allocating available resources as thoughtfully as possible; it also means minimizing wasted resources.¹ (According to that report, as much as 40% of health spending is wasted each year.)

Worldwide, the global health financing landscape has experienced significant volatility over the years, driving demand for greater efficiency and more strategic use of limited resources. Between 2000 and 2020, health spending increased enormously—by more than 117%, according to the Institute for Health Metrics and Evaluation.² As countries became wealthier, populations demanded more and better healthcare services, which in turn became more expensive, driving up spending almost everywhere.³

Moreover, the COVID-19 pandemic further exacerbated this trend, leading to an even more dramatic uptick in global total spending on health, especially in development assistance for health—the funding many low- and middle-income countries depend on to provide essential services.⁴ However, this momentum has since reversed. According to the World Bank, health spending began contracting in 2022, with government expenditure on health falling below pre-pandemic levels in dozens of developing low- and middle-income countries.⁵ IHME estimates that government health spending in low-income countries decreased by $1 per person between 2020 and 2023.⁶ Further, recent cuts in foreign aid that previously supported national health budgets in low- and middle-income countries could reach up to $40 billion over the next three to five years. Other projections indicate that 41 governments will spend less on health between now and 2027 than they did in the pre-pandemic period.⁷ This rapidly changing landscape is driving a renewed focus on health spending efficiency, greater value for money, and more sustainable financing mechanisms to ensure high-quality healthcare provision in the long term.

While countries require more resources towards health, policymakers also have advocated for approaches to improving population health by spending more efficiently. ⁸ (In fact, evidence shows that simply spending more can reduce efficiency if policymakers do not act affirmatively to prevent it.)^9,10 Researchers believe reducing health system inefficiency yields better health outcomes: for example, a 2013 International Monetary Fund report estimated that African countries could improve life expectancy up to five years if they followed best practices for improving efficiency.⁸ At the same time, health systems that demonstrate good stewardship of resources and budget absorption capacity can unlock additional funds from policymakers and donors.¹⁰

Studies show that primary health care can improve the efficiency of health systems: it is the best way to get more health care for less money.¹¹ For instance, most health needs can be prevented or addressed at the PHC level, improving outcomes and reducing costly spending on specialists and hospitals. Coordinated, continuous PHC that emphasizes prevention and early intervention at the community level is not cheap, but scholars argue it enables health systems to provide more and better care—improving output as well as outcomes—for each dollar spent.^12,13

Health system equity and primary health care

According to the World Health Organization, “health equity is achieved when everyone can attain their full potential for health and well-being.”¹⁸ An equitable health system is one that protects its most vulnerable users and eliminates disparities in access and outcomes between different groups of people.

Researchers argue that although it is not a low-cost strategy, PHC is among the most valuable tools for achieving health equity worldwide.^19,20 It improves access to health services on the supply side as well as on the demand side (for instance, by reducing geographic and financial barriers so people can seek and obtain the care they need). Likewise, because it has the potential to reduce hospital admissions and costly emergencies through preventive care and timely diagnoses, PHC can both keep people healthier and protect them from catastrophic health expenditures.

Health system equity and financial protection

According to the World Bank, out-of-pocket spending is any direct payment by households to health practitioners, suppliers of pharmaceuticals, and any other supplier of therapeutic goods and services. Because individuals must pay for out-of-pocket spending, it can threaten their financial security. For poor people, this spending can be catastrophic.