Health Spending Patterns and COVID-19 Crisis in European Union: A Cross-Country Analysis

Abstract

The COVID-19 virus outbreak generated new questions about the health policy all over the world. Last several years’ evolutions proved that short-term financing solutions could help health systems to deal with shocks, but the research regarding the relationship between the ability to react to unexpected events such as pandemics and steady long-term health policies is limited. The purpose of this paper is to study if EU countries that were consistent in financing national health systems were more prepared to deal with the pandemic shock. Using Current Health Expenditures for 2000–2019, a K-means cluster analysis was conducted, and the 27 EU countries were classified into three groups: high, medium, and low health spenders, with 10, 7, and 10 countries per group, respectively. one-way ANOVA (analysis of variance with one dependent variable) was carried out to identify if there are significant differences between the three groups during the COVID-19 pandemic regarding the general level of preparedness (measured by the Global Health Security Index), impact (measured by excess mortality), and digitalisation as a key factor in implementing successful health and economic policies (measured by the Digital Economy and Society Index). The conclusion was that health systems of the countries from the high health spenders cluster performed better for all three dimensions, followed by medium and low health spenders, showing that better financing could increase the performance and the resilience to future shocks of the health systems.