Health policies and data

A comparative analysis of health forecasting methods


Concerns about health care expenditure growth and its long-term sustainability have risen to the top of the policy agenda in many OECD countries. As continued growth in spending places pressure on government budgets, health services provision and patients’ personal finances, policy makers have launched forecasting projects to support policy planning. This comparative analysis reviewed 25 health care expenditure forecasting models that were developed for policy analysis by OECD member countries and other international organisations. The study aims to identify good practices, increase transparency and contribute to improving future forecasting work.


The landscape for health forecasting models is dynamic and evolving. Advances in computing and in detailed health data are opening up new possibilities for the generation of helpful decision-support tools. The review of models highlights emerging systems of models where different modelling approaches are designed to work together coherently. In this way, techniques with different strengths are amalgamated and a broader range of policy questions may be explored. Through the OECD, there is an opportunity for countries to benefit from the lessons learned from comparing forecasting methods across countries to develop and implement an international decision-support platform. Advantages include international comparability of expenditure forecast, through the standardisation of model structure, assumptions, and data; the ability to test and compare the potential results of policy reforms; and the ability to address emerging global issues related to international movement of patients, personnel, services and capital.


Using a component-based health expenditure model developed at the OECD, future projections of public spending on health care and long-term care are made for OECD and key emerging economies, including China. The uniform cross-country framework allows for consistent international comparisons under different cost-pressure and cost-containment scenarios. Results of the projection exercise show that China's public health and long-term care expenditure as a share of GDP is projected to increase from the 3.0% of GDP in 2012 to 4.7% or 5.2% by 2030, according to the different scenarios. This represents a larger increase in percentage terms – up 55% and 72% under the two scenarios - than the average of OECD countries – 29% and 40% - and other key emerging economies – 46% and 63% - reflecting in part the rapidly ageing population in China. These projection results point to important policy challenges for China as it looks to balance cost control while further improving the depth and quality of health care coverage.

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