A commentary on "Comparison of historical medical spending patterns among the BRICS and G7" by Jakovljevic, M.M. (2015). J.Med.Econ. 19, 70–76, doi:10.3111/13696998.2015.109349

Buttigieg, Sandra C.

Camilleri, Carl

Grima, Simon

Frontiers in Pharmacology

English

PubMed

Sandra C. Buttigieg

Simon Grima

Carl Camilleri

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Commentary: Comparison of historical medical spending patterns among the BRICS and G7

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GENERAL COMMENTARYpublished: 14 July 2016doi: 10.3389/fphar.2016.00213Frontiers in Pharmacology | www.frontiersin.org 1 July 2016 | Volume 7 | Article 213Edited by:Alan Haycox,University of Liverpool, UKReviewed by:Andrew Eggleston,Medtronic, AustraliaMarcus Schuetz,The University of Hong Kong,China*Correspondence:Sandra C. Buttigiegsandra.buttigieg@um.edu.mtSpecialty section:This article was submitted toPharmaceutical Medicine andOutcomes Research,a section of the journalFrontiers in PharmacologyReceived: 09 May 2016Accepted: 01 July 2016Published: 14 July 2016Citation:Buttigieg SC, Grima S and Camilleri C(2016) Commentary: Comparison ofhistorical medical spending patternsamong the BRICS and G7.Front. Pharmacol. 7:213.doi: 10.3389/fphar.2016.00213Commentary: Comparison ofhistorical medical spending patternsamong the BRICS and G7Sandra C. Buttigieg 1, 2, 3*, Simon Grima 4 and Carl Camilleri 51Department of Health Services Management, Faculty of Health Sciences, University of Malta, Msida, Malta, 2 School ofSocial Policy, College of Social Sciences, University of Birmingham, Birmingham, UK, 3 Aston Business School, AstonUniversity, Birmingham, UK, 4Department of Insurance, Faculty of Economics, Management and Accountancy, University ofMalta, Msida, Malta, 5Department of Economics, Faculty of Economics, Management and Accountancy, University of Malta,Msida, MaltaKeywords: BRICS, G7, medical spending, justice, ethics, medicalA commentary onComparison of historical medical spending patterns among the BRICS and G7by Jakovljevic, M. M. (2015). J. Med. Econ. 19, 70–76. doi: 10.3111/13696998.2015.1093493Jakovljevic’s comparison of historical medical spending patterns between BRICS and G7 groupsof countries provides a highly valid contribution both from a group, as well as from an individualnation perspective (Jakovljevic, 2015). The author considers two very diverse groups of countries interms of their wealth, population demographic profiles, as well as population health, health systemneeds and medical spending patterns.The first perspective is of an ethical nature and argued through the lens of the principles ofdistributive justice intended for prioritizing populations on the basis of context, and in relationto allocation of scarce healthcare resources. Two principles, often used interchangeably, are theegalitarian and the equity principles. The former dictates serving those in need equally, whereasthe latter consents for contextual differences so that resources are allocated fairly and justly(Persad et al., 2009; Hankins et al., 2015). In particular, equity justifies access to healthcare in thatutilization should echo the populations’ real needs and aims to eliminate socio-economic and otherobstacles. The comparison of the two groups provides a picture of global wealth inequality that islikewise reflected in medical spending. It is therefore worth looking at additional demographic andeconomic indicators as shown in Table 1 to gain a more holistic understanding of the inequalities.The information in Table 1 clearly shows that the egalitarian principle is not supported in viewof the gross global wealth inequality in relation to the populations served; a situation that spillsover to healthcare. More challenging is upholding the equity principle in that one assumes thatthe BRICS populations’ real needs far outweigh those of G7 countries, yet their share of TotalHealth Expenditure (THE) as % of GDP is far less. Furthermore, the BRICS upward trend ismainly dominated by China’s foremost contribution to medical spending trends worldwide. Theincreasing ratio of THE as a % of GDP is an indication that the BRICS countries’ health expenditureis growing at a fast rate. Furthermore, one might question the meaning of real need. Populationaging and chronic non-communicable diseases, referred to as “prosperity” diseases, appear to bekey expensive drivers for G7 countries. However, Jakovljevic also records a historical delay of thesedrivers on THE in BRICS countries, which may justify the higher spending in G7 countries.From a public health perspective, it is also wise to apply the widely used utilitarian principle ofdistributive justice when allocating scarce medical resources, namely to achieve maximum benefitto the maximum percentage of the world population. Conducting cost-effectiveness analysis isButtigieg et al. Medical Spending Patterns: BRICS vs. G7TABLE 1 | Demographic and economic indicators in BRICS and G7 groups of countries.Demographic andeconomic indicatorsGroups of CountriesBRICS G7Description of economy Five major emerging yet large and fast-growing nationaleconomies (Sui and Sun, 2016)Seven major advanced economies as acknowledged byIMF (World Economic Outlook, 2016)Population size 3 billion people or 42% of the world population (WorldEconomic Outlook, 2016)750.47 million people or 10% of the world population(Group of 7 countries (G7): Statistical Profile, 2016)Combined nominal GDP Approximately 20% of the gross world GDP (WorldEconomic Outlook, 2016)Approximately 39% of the gross world GDP (Group of 7countries (G7): Statistical Profile, 2016)Average total per capita healthspending$1004 Purchase Power Parity (PPP) in 2013 (Jakovljevic,2015)$4747 PPP in 2013 (Jakovljevic, 2015)important to choose the most effective health policy, albeitpotentially conflicting with ethical principles that do not relyon the monetary value. This principle is however difficultto assess in the report without delving deeper into thecountries’ disease burden and characteristics. Moreover, thereport challenges the readership to question the attainabilityof WHO’s “Health for all-all for health!” (Hong, 2014) byemphasizing the importance of long-term macro-economicanalysis and its influence on medical spending. Indeed, theappreciation of the economic viewpoint enables internationalhealth organizations and health policy makers to jointly reachmore meaningful explanations of the differences worldwidewhen formulating policies on the provision and utilizationof healthcare resources and on overcoming health inequalitiesworldwide.The second perspective focuses on the downward trend inall G7 countries’ share of THE to global THE in 1995-2013, incontrast to the upward trend of the BRICS (with the exceptionof South Africa). This raises hope that the gap in THE betweenthe two groups is diminishing. However, the stark differencesin % points for individual countries’ THE to global THE spellsout the reality that the gap is expected to remain wide for theforeseeable future. Nevertheless, this report provides a ratherenlightening picture that “successful health reforms in leadingmarkets such as BRICS reveal a reshaping of their medicalcare-related expenditures” (p. 70). Despite the “bold increase innational health spending across the globe” (p. 70), the reporthighlights medical innovation, rising public expectations andextended longevity to explain the accelerated growth in healthcare spending over time. Additionally, the author discussesthe two groups’ population demographic differences (agingvs. younger nations) within the context of access to medicalcare and population needs for healthcare. However, as theauthor’s discussion indicates, these statistics alone do not revealsufficient information about whether spending is allocatedappropriately and efficiently. Therefore, further studies areneeded to determine and quantify the effect of these behavioraldrivers in particular to help curb wastage and misuse/abuse ofscarce resources. Additionally, barriers to global dissemination,adoption and implementation of medical innovation, from G7(often considered as world leaders in this sector) (Kesselheimet al., 2013; Ma et al., 2014) to BRICS countries must beresearched. Furthermore, even after accounting for demographicdifferences, public expectations in different nations/regions, e.g.,North America rather than in groups of countries may help toexplain higher levels of medical spending. This calls for a betterunderstanding and quantifying of the value of needs vs. demandsand their drivers.Finally, the report uses single source data to facilitatecomparisons. Additionally, the author considers 19 years ofobservations as insufficient to uncover long-term THE trends. Anumber of factors, which are usually expected to affect THE of acountry tend to vary over a long period rather than a short periodof time (e.g., changing population structures). The effect of suchfactors might not be fully captured if the data set being used isof a relatively short time frame. However, the counter-argumentis that longer periods may distort findings because of largervariations over time particularly in medical and informationtechnology innovations that distinguished this period from theprevious decades.AUTHOR CONTRIBUTIONSAll three authors contributed actively in the development andfinalization of this general commentary. The correspondingauthor provided the first draft after a group discussion with thetwo co-authors providing comments and edits until we reachedconsensus on the final version for submission.REFERENCESGroup of 7 countries (G7): Statistical Profile (2016). NationMaster.com 2003-2016[Internet]. [cited 2016 May 9]. Available online at: http:// www.nationmaster.com/country-info/groups/Group-of-7-countries-(G7)Hankins, C., Macklin, R., and Warren, M. (2015). Translating PrEP effectivenessinto public health impact: key considerations for decision-makers oncost-effectiveness, price, regulatory issues, distributive justice and advocacyfor access. J. Int. AIDS. Soc. 18(4 Suppl 3):19973. doi: 10.7448/IAS.18.4.19973Frontiers in Pharmacology | www.frontiersin.org 2 July 2016 | Volume 7 | Article 213Buttigieg et al. Medical Spending Patterns: BRICS vs. G7Hong, P. K. (2014). “Health for all, all for health-public policy research for globalhealth,” in Governing Asia Refections on a Research Journey, ed J. L. Ley Chin(Singapore: World Scientific Publishing Co. Ltd; The Lee Kuan Yew School ofPublic Policy, NUS), 133–140.Jakovljevic, M. M. (2015). Comparison of historical medical spendingpatterns among the BRICS and G7. J. Med. Econ. 19, 70–76. doi:10.3111/13696998.2015.1093493Kesselheim, A. S., Wang, B., and Avorn, J. (2013). Defining “innovativeness” indrug development: a systematic review.Clin. Pharmacol. Ther. 94, 336–348. doi:10.1038/clpt.2013.115Ma, F. C., Lyu, P. H., Yao, Q., Yao, L., and Zhang, S. J. (2014). Publication trendsand knowledge maps of global translational medicine research. Scientometrics98, 221–246. doi: 10.1007/s11192-013-1003-yPersad, G., Wertheimer, A., and Emanuel, E. J. (2009). Principles for allocationof scarce medical interventions. Lancet 373, 423–431. doi: 10.1016/S0140-6736(09)60137-9Sui, L., and Sun, L. (2016). Spillover effects between exchange ratesand stock prices: evidence from BRICS around the recent globalfinancial crisis. Res. Int. Bus. Fin. 36, 459–471. doi: 10.1016/j.ribaf.2015.10.011World Economic Outlook (2016). International Monetary Fund [Internet].[cited 2016 May 9]. Available online at: http://www.imf.org/external/pubs/ft/weo/2013/01/weodata/weorept.aspx?pr.x=91&pr.y=5&sy=2011&ey=2018&scsm=1&ssd=1&sort=country&ds=.&br=1&c=223%2C924%2C922%2C199%2C534&s=NGDPD%2CNGDPDPC%2CPPPGDP%2CPPPPC&grp=0&aConflict of Interest Statement: The authors declare that the research wasconducted in the absence of any commercial or financial relationships that couldbe construed as a potential conflict of interest.Copyright © 2016 Buttigieg, Grima and Camilleri. This is an open-access articledistributed under the terms of the Creative Commons Attribution License (CC BY).The use, distribution or reproduction in other forums is permitted, provided theoriginal author(s) or licensor are credited and that the original publication in thisjournal is cited, in accordance with accepted academic practice. No use, distributionor reproduction is permitted which does not comply with these terms.Frontiers in Pharmacology | www.frontiersin.org 3 July 2016 | Volume 7 | Article 213

Commentary : comparison of historical medical spending patterns among the BRICS and G7

GENERAL COMMENTARY
published: 14 July 2016
doi: 10.3389/fphar.2016.00213
Frontiers in Pharmacology | www.frontiersin.org 1 July 2016 | Volume 7 | Article 213
Edited by:
Alan Haycox,
University of Liverpool, UK
Reviewed by:
Andrew Eggleston,
Medtronic, Australia
Marcus Schuetz,
The University of Hong Kong,
China
*Correspondence:
Sandra C. Buttigieg
sandra.buttigieg@um.edu.mt
Specialty section:
This article was submitted to
Pharmaceutical Medicine and
Outcomes Research,
a section of the journal
Frontiers in Pharmacology
Received: 09 May 2016
Accepted: 01 July 2016
Published: 14 July 2016
Citation:
Buttigieg SC, Grima S and Camilleri C
(2016) Commentary: Comparison of
historical medical spending patterns
among the BRICS and G7.
Front. Pharmacol. 7:213.
doi: 10.3389/fphar.2016.00213
Commentary: Comparison of
historical medical spending patterns
among the BRICS and G7
Sandra C. Buttigieg 1, 2, 3*, Simon Grima 4 and Carl Camilleri 5
1Department of Health Services Management, Faculty of Health Sciences, University of Malta, Msida, Malta, 2 School of
Social Policy, College of Social Sciences, University of Birmingham, Birmingham, UK, 3 Aston Business School, Aston
University, Birmingham, UK, 4Department of Insurance, Faculty of Economics, Management and Accountancy, University of
Malta, Msida, Malta, 5Department of Economics, Faculty of Economics, Management and Accountancy, University of Malta,
Msida, Malta
Keywords: BRICS, G7, medical spending, justice, ethics, medical
A commentary on
Comparison of historical medical spending patterns among the BRICS and G7
by Jakovljevic, M. M. (2015). J. Med. Econ. 19, 70–76. doi: 10.3111/13696998.2015.1093493
Jakovljevic’s comparison of historical medical spending patterns between BRICS and G7 groups
of countries provides a highly valid contribution both from a group, as well as from an individual
nation perspective (Jakovljevic, 2015). The author considers two very diverse groups of countries in
terms of their wealth, population demographic profiles, as well as population health, health system
needs and medical spending patterns.
The first perspective is of an ethical nature and argued through the lens of the principles of
distributive justice intended for prioritizing populations on the basis of context, and in relation
to allocation of scarce healthcare resources. Two principles, often used interchangeably, are the
egalitarian and the equity principles. The former dictates serving those in need equally, whereas
the latter consents for contextual differences so that resources are allocated fairly and justly
(Persad et al., 2009; Hankins et al., 2015). In particular, equity justifies access to healthcare in that
utilization should echo the populations’ real needs and aims to eliminate socio-economic and other
obstacles. The comparison of the two groups provides a picture of global wealth inequality that is
likewise reflected in medical spending. It is therefore worth looking at additional demographic and
economic indicators as shown in Table 1 to gain a more holistic understanding of the inequalities.
The information in Table 1 clearly shows that the egalitarian principle is not supported in view
of the gross global wealth inequality in relation to the populations served; a situation that spills
over to healthcare. More challenging is upholding the equity principle in that one assumes that
the BRICS populations’ real needs far outweigh those of G7 countries, yet their share of Total
Health Expenditure (THE) as % of GDP is far less. Furthermore, the BRICS upward trend is
mainly dominated by China’s foremost contribution to medical spending trends worldwide. The
increasing ratio of THE as a % of GDP is an indication that the BRICS countries’ health expenditure
is growing at a fast rate. Furthermore, one might question the meaning of real need. Population
aging and chronic non-communicable diseases, referred to as “prosperity” diseases, appear to be
key expensive drivers for G7 countries. However, Jakovljevic also records a historical delay of these
drivers on THE in BRICS countries, which may justify the higher spending in G7 countries.
From a public health perspective, it is also wise to apply the widely used utilitarian principle of
distributive justice when allocating scarce medical resources, namely to achieve maximum benefit
to the maximum percentage of the world population. Conducting cost-effectiveness analysis is
Buttigieg et al. Medical Spending Patterns: BRICS vs. G7
TABLE 1 | Demographic and economic indicators in BRICS and G7 groups of countries.
Demographic and
economic indicators
Groups of Countries
BRICS G7
Description of economy Five major emerging yet large and fast-growing national
economies (Sui and Sun, 2016)
Seven major advanced economies as acknowledged by
IMF (World Economic Outlook, 2016)
Population size 3 billion people or 42% of the world population (World
Economic Outlook, 2016)
750.47 million people or 10% of the world population
(Group of 7 countries (G7): Statistical Profile, 2016)
Combined nominal GDP Approximately 20% of the gross world GDP (World
Economic Outlook, 2016)
Approximately 39% of the gross world GDP (Group of 7
countries (G7): Statistical Profile, 2016)
Average total per capita health
spending
$1004 Purchase Power Parity (PPP) in 2013 (Jakovljevic,
2015)
$4747 PPP in 2013 (Jakovljevic, 2015)
important to choose the most effective health policy, albeit
potentially conflicting with ethical principles that do not rely
on the monetary value. This principle is however difficult
to assess in the report without delving deeper into the
countries’ disease burden and characteristics. Moreover, the
report challenges the readership to question the attainability
of WHO’s “Health for all-all for health!” (Hong, 2014) by
emphasizing the importance of long-term macro-economic
analysis and its influence on medical spending. Indeed, the
appreciation of the economic viewpoint enables international
health organizations and health policy makers to jointly reach
more meaningful explanations of the differences worldwide
when formulating policies on the provision and utilization
of healthcare resources and on overcoming health inequalities
worldwide.
The second perspective focuses on the downward trend in
all G7 countries’ share of THE to global THE in 1995-2013, in
contrast to the upward trend of the BRICS (with the exception
of South Africa). This raises hope that the gap in THE between
the two groups is diminishing. However, the stark differences
in % points for individual countries’ THE to global THE spells
out the reality that the gap is expected to remain wide for the
foreseeable future. Nevertheless, this report provides a rather
enlightening picture that “successful health reforms in leading
markets such as BRICS reveal a reshaping of their medical
care-related expenditures” (p. 70). Despite the “bold increase in
national health spending across the globe” (p. 70), the report
highlights medical innovation, rising public expectations and
extended longevity to explain the accelerated growth in health
care spending over time. Additionally, the author discusses
the two groups’ population demographic differences (aging
vs. younger nations) within the context of access to medical
care and population needs for healthcare. However, as the
author’s discussion indicates, these statistics alone do not reveal
sufficient information about whether spending is allocated
appropriately and efficiently. Therefore, further studies are
needed to determine and quantify the effect of these behavioral
drivers in particular to help curb wastage and misuse/abuse of
scarce resources. Additionally, barriers to global dissemination,
adoption and implementation of medical innovation, from G7
(often considered as world leaders in this sector) (Kesselheim
et al., 2013; Ma et al., 2014) to BRICS countries must be
researched. Furthermore, even after accounting for demographic
differences, public expectations in different nations/regions, e.g.,
North America rather than in groups of countries may help to
explain higher levels of medical spending. This calls for a better
understanding and quantifying of the value of needs vs. demands
and their drivers.
Finally, the report uses single source data to facilitate
comparisons. Additionally, the author considers 19 years of
observations as insufficient to uncover long-term THE trends. A
number of factors, which are usually expected to affect THE of a
country tend to vary over a long period rather than a short period
of time (e.g., changing population structures). The effect of such
factors might not be fully captured if the data set being used is
of a relatively short time frame. However, the counter-argument
is that longer periods may distort findings because of larger
variations over time particularly in medical and information
technology innovations that distinguished this period from the
previous decades.
AUTHOR CONTRIBUTIONS
All three authors contributed actively in the development and
finalization of this general commentary. The corresponding
author provided the first draft after a group discussion with the
two co-authors providing comments and edits until we reached
consensus on the final version for submission.
REFERENCES
Group of 7 countries (G7): Statistical Profile (2016). NationMaster.com 2003-2016
[Internet]. [cited 2016 May 9]. Available online at: http:// www.nationmaster.
com/country-info/groups/Group-of-7-countries-(G7)
Hankins, C., Macklin, R., and Warren, M. (2015). Translating PrEP effectiveness
into public health impact: key considerations for decision-makers on
cost-effectiveness, price, regulatory issues, distributive justice and advocacy
for access. J. Int. AIDS. Soc. 18(4 Suppl 3):19973. doi: 10.7448/IAS.18.4.
19973
Frontiers in Pharmacology | www.frontiersin.org 2 July 2016 | Volume 7 | Article 213
Buttigieg et al. Medical Spending Patterns: BRICS vs. G7
Hong, P. K. (2014). “Health for all, all for health-public policy research for global
health,” in Governing Asia Refections on a Research Journey, ed J. L. Ley Chin
(Singapore: World Scientific Publishing Co. Ltd; The Lee Kuan Yew School of
Public Policy, NUS), 133–140.
Jakovljevic, M. M. (2015). Comparison of historical medical spending
patterns among the BRICS and G7. J. Med. Econ. 19, 70–76. doi:
10.3111/13696998.2015.1093493
Kesselheim, A. S., Wang, B., and Avorn, J. (2013). Defining “innovativeness” in
drug development: a systematic review.Clin. Pharmacol. Ther. 94, 336–348. doi:
10.1038/clpt.2013.115
Ma, F. C., Lyu, P. H., Yao, Q., Yao, L., and Zhang, S. J. (2014). Publication trends
and knowledge maps of global translational medicine research. Scientometrics
98, 221–246. doi: 10.1007/s11192-013-1003-y
Persad, G., Wertheimer, A., and Emanuel, E. J. (2009). Principles for allocation
of scarce medical interventions. Lancet 373, 423–431. doi: 10.1016/S0140-
6736(09)60137-9
Sui, L., and Sun, L. (2016). Spillover effects between exchange rates
and stock prices: evidence from BRICS around the recent global
financial crisis. Res. Int. Bus. Fin. 36, 459–471. doi: 10.1016/j.ribaf.2015.
10.011
World Economic Outlook (2016). International Monetary Fund [Internet].
[cited 2016 May 9]. Available online at: http://www.imf.org/external/pubs/
ft/weo/2013/01/weodata/weorept.aspx?pr.x=91&pr.y=5&sy=2011&ey=2018&
scsm=1&ssd=1&sort=country&ds=.&br=1&c=223%2C924%2C922%2C199
%2C534&s=NGDPD%2CNGDPDPC%2CPPPGDP%2CPPPPC&grp=0&a
Conflict of Interest Statement: The authors declare that the research was
conducted in the absence of any commercial or financial relationships that could
be construed as a potential conflict of interest.
Copyright © 2016 Buttigieg, Grima and Camilleri. This is an open-access article
distributed under the terms of the Creative Commons Attribution License (CC BY).
The use, distribution or reproduction in other forums is permitted, provided the
original author(s) or licensor are credited and that the original publication in this
journal is cited, in accordance with accepted academic practice. No use, distribution
or reproduction is permitted which does not comply with these terms.
Frontiers in Pharmacology | www.frontiersin.org 3 July 2016 | Volume 7 | Article 213


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A commentary on “Comparison of historical medical spending patterns among the BRICS and G7” by Jakovljevic, M.M. (2015). J. Med. Econ. 19, 70–76. (doi:10.3111/13696998.2015.1093493)peer-reviewe

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Commentary : comparison of historical medical spending patterns among the BRICS and G7

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