Why we need innovation and new funding models in the face of falling global health spend

Editor's note: Shyam Bishen is head of the Centre for Health and Healthcare, and a member of the Executive Committee of the World Economic Forum. The article reflects the author's opinions and not necessarily the views of CGTN.

Healthcare needs new funding models, and with this, new forms of collaboration, risk tolerance and long-term thinking – qualities often in short supply in traditional funding architectures. But the simple truth is that while global health outcomes have improved in recent years, these gains face stark risks. Not only are the challenges of climate patterns and shifting demographics growing, but a decline in cross-border health financing and development assistance has now been added to this potent mix.

Recent analysis shows that while health outcomes such as life expectancy and reductions in child and maternal mortality have continued to improve post-pandemic, the pace of progress has slowed. Furthermore, health regulations scores have stagnated or declined, signaling weakening global public health preparedness. If left unaddressed, this will threaten to reverse the hard-won health gains.

Today's healthcare systems face four major challenges: climate impact; which is forecast to cause 14.5 million additional deaths by 2050; the demands of an aging population, itself expected to double in the next 25 years; mounting non-communicable diseases, and persistent systemic disparities in healthcare access and outcomes.

A fifth major challenge has emerged – geopolitical disruption. At the best of times, the interplay between geopolitics and global public health is complicated. In the worst of times, this dynamic quickly unravels health programmes, systems and supply chains. These are arguably the worst of times.

A sudden decline in development assistance, particularly from Europe and the US, has had an immediate and profound effect on programmes and the staff running them. It would be bad enough if this was the only geopolitical shift, but global public health is also facing the problem of rising tariffs and trade tensions, which undermine its supply chains, as well as the fragmentation of traditional multilateral support systems.

This matters greatly for three reasons. Firstly, not only have we put all the health-related gains that have been made in the past 20 years in jeopardy, but we've made ourselves – and future generations – more vulnerable at a time when risks like climate-related health problems and others are growing.

Secondly, the unravelling of global public health funding affects innovation, collaboration and regulatory coherence. Funding is vital to R&D, spurring new medical technologies and treatments. The opposite swiftly results in slowing progress, lacking coordination and the inadvertent duplication of efforts. Topping this, inequitable distribution can create inconsistencies in regulation, in the specifics of the regulation itself, as well as implementation and enforcement.

This creates the third problem – an even greater burden on universal access to health services. Furthermore, health service resilience is now at risk in developed and developing nations alike. Resilience involves being ready for COVID-type shocks, helping health services minimize the challenge, and recover as quickly as possible (thereby containing disruption and cost). Developing resilience requires funding, and as health challenges mount, greater funding is needed. In this respect, the decision to cut overseas aid couldn't come at a worse time.

Funding global health is not a static system. Although the system has suffered a huge recent shock, solutions are being developed all the time. The likely result of geopolitical upheaval is that their development will be accelerated, with governments taking the opportunity to change their funding models. In this respect, innovation is essential and must now extend far beyond new medicines or medical devices, encompassing not just how we fund, but more importantly, how we deliver and govern health systems.

We must move away from the reliance on ad hoc donor pledges to fund health crises and unhelpful models that link finance directly to results, as is the case with health impact bonds. Instead, we need innovation in financing, particularly a shift to blended finance models that de-risk investment and attract far larger pools of funding. We also need insurance mechanisms that swiftly provide financial liquidity during health crises, decentralized care models that more efficiently and cost-effectively support the underserved, and we must learn to use technology like AI and data management astutely, enabling us to achieve more with fewer resources.

The shift towards multipolarism has brought the rights and needs of nations back to the top of agendas. Alongside this, there's been a perceptible shift towards reimagining global health as a system that adapts to this new reality. With the decline in overseas aid and collaboration, health services are more likely to go local, alongside which, funders' mandates and scope to shape impact will change.

Governments should regard this as an opportunity to develop national health systems and make health an economic driver. Addressing health service gaps, such as workforce training and retention, or bolstering regional supply chains, is essential. Where countries struggle to achieve this at a national level, there's likely to be a shift towards regional autonomy in health.

This doesn't mean that nations should stop developing and benefitting from wider cooperation and collaboration. Health challenges rarely respect borders, underscoring the continuing need for global governance mechanisms, be these to monitor disease outbreaks or help develop access and outcomes. Currently, these are in turmoil, suggesting the need to emphasize their vital role and develop viable regional counterparts.

It sounds dramatic to say that everything is at stake, but it is. Without proper global public health funding, the risks increase for everyone. This isn't a hollow prediction; COVID provided a grim test case. According to WHO figures, service interruptions to TB programmes resulted in more than 700,000 "excess deaths" from the disease between 2020 and 2023.

Falling global health spend, combined with intensifying health threats and persistent imbalance, makes innovation and new funding models not just desirable but essential. It also means that swiftly detecting – and acting to develop – the opportunities that arise from this crisis are of paramount importance.

The World Economic Forum's inaugural Annual Health Roundtable from May 20 to 21 in Geneva will explore these critical topics, using its convening power and commitment to multi-stake holder collaboration to drive the systemic change needed to secure a healthier future for all.

(Cover via VCG)