Inequality: It’s Bad for Our Health

A Publication of the 2013 Eli Hurvitz Conference on Economy and Society

  • Publication Date:
  • Cover Type: Online Booklet
  • Number Of Pages: 40 Pages
  • Center: Eli Hurvitz Conference on Economy and Society (Caesarea Forum)

On November 6–7, 2013, IDI will convene the second Eli Hurvitz Conference on Economy and Society. Formerly known as the Caesarea Economic Policy Planning Forum, the conference fosters open discussion between senior government decision-makers and leading figures in academia, the non-profit sector, and the business world. The event will be broadcast live on the IDI website in both Hebrew and English.

Entitled Inequality: It's Bad for Our Health, this booklet was prepared by a team of researchers for the conference's session on health.

Health is a fundamental right of every human being and it is an essential resource that contributes to the prosperity of the individual and the development and growth of the society. The National Health Insurance Law, founded upon "principles of justice, equality, and mutual assistance," seeks to ensure equality in the availability, quality, and accessibility of health services. However, this does not guarantee actual equality in these aspects or in the health status of the entire populace. Along with many countries, Israel joined the World Health Organization's Ottawa Charter, which calls for "Health for All.

Health Inequalities

Health inequity refers to inequities in health between population groups that are associated with social factors. These inequalities are preventable and thus unfair. In Israel, there are significant inequalities in life expectancy and infant mortality, as well as inequalities in physical and mental illness between segments of the population, based on socio-economic factors, ethnic origin, and more. The association is monotonic, where each decline in socio-economic position is associated with an increased risk of poor health. In recent decades, there is evidence of widening inequalities. The inequalities in socio-economic position, such as the individual’s education and income, are the principal factors explaining the inequalities in health among Jews by country of origin, as well as the inequalities in health between Jews and Arabs.

A combination of factors at the individual, community, and societal levels, and at various stages over the life-course, contributes to the socio-economic inequalities in health. These inequalities are only partially attributed to the lack of material resources and problems of accessibility or infrastructure of health services, as the production function of health does not only depend on input from the health system, but also on many external factors.

The Economic Cost of Health Inequalities

Poor health has an economic cost: lower employment, growth, and productivity; a direct cost to the social welfare system; and harm to the wellbeing of the population. An initial calculation of the economic costs of the health inequalities in Israel is based on costs linked to early death (a social value), on the loss of work days, and on the costs of medical care. This calculation indicates a very significant economic burden—about 7% of GDP, a sum that is just slightly below the national expenditure on health. A similar calculation conducted in the European Union showed a similar percentage.

The Barriers to Narrowing Inequalities in Health

Despite the potential economic benefit associated with narrowing health inequalities, there are numerous barriers preventing tackling the problem: lack of awareness of the scope and consequences of health inequalities for the society and the economy; lack of an integrative perspective shared by the investing organization (for example, the HMO) and the organization that receives the return on the investment (for example, the social welfare system); a significant time gap between the dates of investment and return; lack of awareness regarding the prices; and the need for a substantial initial investment.

Ways to Narrow Inequalities in Health

It is not possible to completely eliminate inequalities in health, but it is possible to narrow them. The awareness of socio-economic inequalities in health has increased in Israel during the past decade and, as a result, dedicated activity has been initiated to reduce them. However, these activities are still limited. Activities should be based on changing the factors underlying the inequalities. Therefore, comprehensive action is required that combines the forces of the health system with other support systems (social welfare, education, and more), as well as collaboration with the business sector and the third sector in order to achieve an ongoing and sustainable reduction in inequalities.

Tools incorporating assessment and evaluation should be developed to help translate the overall economic benefit to be derived from narrowing the inequalities as a result of investment in suitable interventions. Possible approaches include:

  • Creating a mechanism to fund initiatives for narrowing inequalities in view of the associated benefits—for example, by using social impact bonds.
  • Creating incubators for funding feasibility studies of initiatives aimed at narrowing the inequalities.
  • Adopting health (disparities) in all policies by defining a mandatory standard for examining the repercussions of key decisions in the work of all government ministries on health and on the widening inequalities in health.
  • Activity aimed at narrowing inequalities at the local level.
  • Expanding the range of organizations and frameworks engaged in health promotion and disease prevention, including employers, community leaders, and religious leaders.
  • Developing dedicated programs in the framework of National Service (Sherut Leumi).
  • Removing the regulatory barriers to virtual medical services in order to reduce geographic inequalities in accessibility.

Conclusions

Spending on health is an investment that yields positive returns for the economy. Inequality in health has a price, just as there is a price to inequality in income. Improving the health of the weaker segments of the society will lead to an increase in the average level of health in the population, will bring additional groups into the work force, and increase economic growth.

  • The investment in narrowing inequalities that produces the best results is investment that focuses on health promotion and disease prevention.
  • Intervention should be targeted at the specific points over the life course that will yield a high return on investment.
  • In light of the high cost of health inequalities for the individual and the society, and the identified barriers for narrowing them, a clear government policy should be adopted that includes inter-ministerial and cross-sector activity to reduce the inequalities. The narrowing of health inequalities will help individuals to realize their potential and enable them to pursue full and productive lives; it will foster a sense of fairness and enhance the level of social solidarity; it will yield financial savings, stimulate economic growth, and strengthen the vitality of the society.

Head

  • Prof. Orly Manor, Professor of Biostatistics, School of Public Health and Community Medicine, The Hebrew University of Jerusalem and Hadassah


Members

  • Dr. Emma Averbuch, Coordinator, Reducing Health Inequalities Unit, Ministry of Health; Lecturer in Medical Sociology, School of Public Health and Community Medicine, The Hebrew University of Jerusalem and Hadassah
  • Prof. Alik Aviram, Scientific Director, The Israel National Institute for Health Policy Research
  • Prof. Ran D. Balicer, Director, Health Policy Planning, Clalit Chief Physicians Office; Founding Director, Clalit Research Institute; Associate Professor and Track Director, MPH program, Division of Public Health, Faculty of Health Sciences, Ben-Gurion University of the Negev
  • Prof. Gabi Bin Nun, Associate Professor, Department of Health Systems Management, Ben-Gurion University of the Negev
  • Dr. Nihaya Daoud, Lecturer, Department of Public Health, Faculty of Health Sciences, Ben-Gurion University of the Negev; Director, National Council of Health Promotion, Ministry of Health
  • Prof. Asher Elhayany, Fellow, Taub Center for Social Policy Studies in Israel; Member, National Council for Health in Community; Professor of Health Management, Ariel University
  • Dr. Tuvia Horev, Senior Deputy Director General, Strategic and Economic Planning, Ministry of Health
  • Mr. Nir Kaidar, Deputy Director, Administration for Strategic and Economic Planning, Head, Health Economics Unit, Ministry of Health
  • Ms. Ziva Litvak, Managing Director, The Israel National Institute for Health Policy Research
  • Prof. Gur Ofer, Professor Emeritus, Department of Economics, The Hebrew University of Jerusalem
  • Mr. Eran Politzer, Economist, Public Sector Unit, Research Department, Bank of Israel
  • Dr. Joseph Rosenblum, Director, Medical Informatics Department, Medical Division, Maccabi Health Services
  • Prof. Amir Shmueli, Professor of Health Economics, School of Public Health and Community Medicine, The Hebrew University of Jerusalem and Hadassah
  • Prof. Varda Soskolne, Associate Professor and Deputy Head, The Louis and Gabi Weisfeld School of Social Work, Bar-Ilan University