draft Aug 6, 2006) This paper examines the effects of economic and demographic trends upon the costs and provision of health services among countries at different stages of development, and in particular how different financing methods lead to different roles for the Ministry of Health-and the likelihood they create of a public health system crisis. First, the trends in Medical Technology, demographics and national health spending as projected by the OECD, the WHO and the Society of Actuaries

more »

... presented. The analysis proceeds to examine divergences between sub-sectors (elderly v. young, poor v. rich, urban v. rural, hospital v. clinic or doctor). Special attention is given to the question of whether a widening gap between groups (urban v. rural, rich v. poor) will cause average per capita expenditures to rise more or less rapidly, and the extent to which it may cause of result from public v. private financing. The ability of financing mechanisms to promote or disrupt harmony in response to two major challenges (1. Rising Costs 2. Biologic Catastrophe) are then discussed. Careful attention is given to the differences in the causes of individual health expenditures and national health expenditures, and the relationship of each to income of the person, or of the national as a whole. This provides a foundation for a typology of Ministry of Health and Ministry of Finance responses to (a) Long Term Trends and (B) Public Perceptions. The economics of budgeting is shown to be a task that is both inherently technical, and also political, relying ultimately on public support. It is concluded that it is up to the people and the political process to determine the amount of money in total available to pay for health care costs, and the task of the national health authority to use that funding wisely to obtain the best health outcomes, satisfaction with care, and trust between patients, physicians and hospitals.